22 Oct 2021

America Is Running Out Of Everything!

America is running out of everything!

This shortage may not be a supply chain problem - this is just a supply problem.

Alarmingly, stagflation may not be the result. Stagflation is going to be the solution to solve the problem.

To stave off a pandemic-induced Depression caused by a demand crunch, Governments, and central Banks poured money and aid into the system. So workers stayed home.

Working from home works for the knowledge workers, but NOT for those who need to make the real goods. Government free money that allows the workers to stay home creates the demand. But those hands required to create the supply are busy playing video games at home.

Too much money chasing too few goods - classic prescription for inflation.

In reality, companies are reluctant to increase prices quickly. This has created shortages and empty shelves.

We should see prices rise quickly in the near term. Companies should boldly adjust prices to clear the markets.

It may be time to recycle those old pair of jeans and cobble the old pair of sneakers, so they last longer.

Time to start growing our own tomatoes and greens!


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