Lower inflation but still high

Updated charts for U.S. annual inflation appear below. For the last 12 months, inflation has been 7.3 percent, based on a 12 month moving average. That is lower than the prior period which had an 8.2 percent increase and much lower than 2012’s increase of 14 percent. Yikes!

Annual Changes FRD - 2015.08 vert bars v1

If you’re not making 7.3 percent more than last year, than you are likely WORSE off because the value of the dollar has or will go down about 7.3 percent, all other things being equal. Now if people from other countries suddenly want more dollars, than the value of the dollar may not fall the full 7.3%; the value could even go up. However, the value will be 7.3 percent lower than what it would have been if Federal Reserve had not created more dollars. Note, all the entities that took out loans are equally responsible since Fed Reserve banks only created dollars when they loaned them out.

The chart below shows that numbers of dollars doubled in just seven years, two years faster than the prior doubling.

FR Digit Quantity thru 2015-08 Website v1

Here is the data driving the charts.

Money Quantity Table - 2015.08

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