On economic matters, no one really knows what is about to happen, with one possible exception. It is demonstrably certain inflation into 2022 will continue increasing. Beyond that, after pumping $9+ trillion into the U.S. economic system under the guise of COVID relief, we are entering some very uncharted waters.
On a macro level, CTH has an idea what is likely to take place in the next three years; however, before getting to that, allow me to present evidence for the underlying supposition. As you can see from this Biden message, shaped entirely by politics, on an economic basis the people around him have no idea what the downstream consequences of 2020 and 2021 will present in 2022:

The team behind Joe Biden brag about the U.S. economy being the only economy to continue growing during the COVID-19 pandemic period. Their top line reference point is the Gross Domestic Product, or GDP. Their brag is the U.S. GDP did not shrink during 2021 and the COVID pandemic.
However, what they omit (for political reasons) is that massive U.S. spending and bailouts covered the GDP hole. More than $9 trillion was injected for stimulus payments, blue state bailouts, payroll protection programs, rent moratoriums, school subsidies, medical payments to hospitals, student loan payment pauses, vaccination purchases, covid sick pay and years of continually extended and enhanced unemployment benefits.
They also omit that none of this domestic spending would be possible if the global trade currency did not take place in dollars. Our value is propped up by the fact that almost all trade takes place in U.S. currency. If that system was not in place, congress could not spend this much money without collapsing the U.S. into a devaluation position resembling what happened previously in Greece.
(more…)