Please make us trillionaires. Just the sound of it! It’s beautiful, Ben. But without your help, we’ll never get there. So, at your meeting next week, think about us. Because the way you make trillionaires is by printing money.
Maybe not everybody can be a trillionaire. But that’s OK. The rest of us will have the pleasure of walking around with millions in our pockets. Remember Turkey, late 1990s. It was awesome, Ben. You have no idea. Everybody was a millionaire. Even the poor. The entire middle class consisted of billionaires. And there were some trillionaires too. You could buy a döner sandwich and pay 10 million liras and get 8 million liras back. Awe-inspiring to watch a simple man casually counting out so much money. That’s democracy, Ben. Just imagine what that would do in America.
It would solve a host of problems. Now, you probably don’t look at the reports from the Census Bureau , and you’re better off averting your eyes because the number is truly ugly: 46.2 million Americans in poverty. That’s a scandal. But you can do something about it, Ben. You can turn them into millionaires. It worked in Turkey.
Actually, you and your predecessors have come a long way. For example, the San Francisco Bay Bridge was built in the 1930s for $77 million. Today, the price tag for just fixing its suspension section and replacing its cantilever section is $7.2 billion. Of course, we never want to follow the price of a real thing over time. That would be apples to apples. Oh no! We want concoctions like your favorite “trimmed mean PCE” inflation index. This way, we don’t see inflation, and wages seem to be going up.
Now, another ugly number came out, and you better avert your eyes again: Medium income adjusted for inflation dropped 7% over the last twelve years. That’s actually a phenomenally good number. It means there’s plenty of cheap labor. The problem is that this number is all over the front pages. Which destroys confidence in your work, Ben.
You see, over the same period, college tuition has more than doubled and health care costs have gone up over 50%. But students must not be allowed to know they’re graduating with ever more debt while earning ever less to pay for it once they get a job. You need to cover this up with your rhetoric, Ben.
In your speech in Minneapolis the other day, for example, you said, “subdued unit labor costs should be an important restraining influence on inflation.” That’s too wishy-washy, Ben. You should have said clearly that repressing wages keeps costs down and profits up, and as long as real wages are declining, you’re not worried about rising prices of goods and services. It would have given us the confidence that is now lacking.
Your predecessor, who gets partial credit for the current scenario (sorry Ben), never worried about rising prices. It’s when wages started rising that he slammed on the brakes. Well, that was at the turn of the millennium, and real wages have gone down since. Good job, both of you. Well, we know that other people are involved in these policy decisions, but you’re the main spokesperson, the one we look up to. So you need to be out there stating things more emphatically. Show a little pride in the achievement of your team at the Fed.
In your speech in Minneapolis, you indicated further that you were surprised by “the unusual weakness in household spending.” I mean come on, Ben. So consumers are earning less and paying more, and their income from bonds, CDs, and bank accounts has disappeared, while banks, big corporations, and governments are borrowing money essentially for free—but you shouldn’t have said that. You should have said, “Don’t worry fellow Americans, I will turn all of you into millionaires and billionaires and even trillionaires.” That’s the American dream. That’s what we want to hear. And in the background, we want to hear the squealing of the printing press running at full tilt.
Printing money works, Ben. History has proven that. So don’t back off now just because some presidential candidates call you nasty things. Look at Turkey. It worked wonderfully. Over New Year’s in 2005, the government even revaluated the lira. At 1,000,000 lira to 1 “new lira.” And poof, all the millionaires were once again poor…. Oh wait, that’s a bad example. But there must be a good example out there, somewhere. I’ll get back to you on that. Meanwhile, keep at it, Ben.
Would you like to be notified via email when WOLF STREET publishes a new article? Sign up here.