Cyreenik Says
Inflation is one barometer for Community Panic.
This may be because if a community tolerates inflation -- the rapid loss of the value of its money -- it feels out of control and it is in panic. It is a sign that the government's traditional tools for solving the community's problems aren't working, so it has resorted to rolling the money printing presses as an expedient.
Because high inflation signals the community is in panic, it is a signal that other crazy ideas are being considered as possible solutions as well... which means blunder time is upon the community.
In the case of the US in the summer of 2008, inflation is upon us in a big way. It's not being called inflation by the government or media, it's being called rising food and gas prices. But... it sure looks like inflation... it sure smells like inflation... hmm....
One of the other crazy ideas that is being seriously considered is an idea being promoted by the various presidential candidates. They are calling for a "Gas Tax Holiday".
This gas tax holiday idea is a blunder. It's not like the gas tax was buying Americans dessert. It pays for roads. Mess with the gas tax and you're messing with roads. Big mistake!
But... the fact that this idea is being taken seriously is a clear symptom that the US community is panicking. It is an example showing that inflation is a good barometer for the scale of economic panic the US is enduring in 2008.
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