1st American Reserve Blog

You could say that Congress and the Federal Reserve are beginning to “go crazy” with the printing press. The parade of stimulus packages brought forth by the Federal Reserve and Congress are on course to add as much as $10 trillion in new money and new debt when all is said and done. Much of it seems to be a cynical attempt to “buy votes” this November, since they are sending out stimulus checks to people who are still working, while not even asking those businesses and workers to send in their regular taxes yet!

The official estimate for this year’s federal deficit is $3.8 trillion – more than triple the previous record – and it may go much higher than that. The total U.S. debt has risen $2.5 trillion in the first four months of this year, from $23.2 trillion in January to $25.7 trillion in May. The latest “stimulus” bill being pushed through the Senate by spendthrift Democrats is called the Monthly Economic Crisis Support Act. It was introduced by Senators Kamala Harris (D-Calif.); Bernie Sanders (Ind-Vt.); and Ed Markey (D-Mass.) The bill calls for sending $2,000 per month to individuals, $4,000 to couples, plus $2,000 per child up to three children. That’s $10,000 for a family of five, or $120,000 per year, although payments would be reduced for those families earning over $100,000. Have we ever seen such a blatant giveaway before?

At the same time, the Federal Reserve Chairman Jerome Powell is promising total giveaways to banks for loans when he says, “When it comes to lending, we’re not going to run out of ammunition,” adding, “we will provide essentially unlimited lending to support the economy.” That’s a promise of unlimited money.

Although we’re not at war, this situation promises the same kind of runaway inflation we saw in the Revolutionary War, when General George Washington complained that the paper “Continentals” the Congress had issued had become worthless: “A wagonload of continentals can’t buy a wagonload of provisions,” he complained. We saw similar inflations during World War I and II and after Vietnam.

When so much money is printed without backing, the limited amount of gold and silver left in circulation becomes more valuable, as it did in previous wartime inflationary periods.