Nancy Pelosi Is Excited About Helicopter Money; More Inflation Will Be The Result

COVID relief money is on the way. This thrilling news is apparently such a huge hit in Washington, DC, that none other than Nancy Pelosi is quoting songs by the Pointer Sisters.

"I'm so excited, I just can't hide it.
I'm about to lose control and I think I like it."

-- Pointer Sisters, 1982

Pelosi, for all her eccentricities, is showing her age (80), referencing a song that was released in 1982, nearly 40 years ago. Most of the people who are going to benefit from the partisan American Rescue Plan Act of 2021 weren't even old enough to remember the song. Worse yet, Nancy called it the "Biden American Rescue Plan," pretending that the pretender-in-chief, Joe Biden, actually had anything to do with the drafting of the legislation or pushing it through a divided congress.

The House voted Tuesday for two hours of debate - beginning Wednesday at 9:00 am ET - before voting on the measure, so, by noon Wednesday, the bill should become law and the spice will begin to flow sonn thereafter.

All Sleepy Joe is going to do is sign it, likely later this week, preferably before his warm milk and nap time, and the machinery of government will snap into action, sending out $1400 virtual checks (and some real ones) to millions of Americans.

In addition to providing a version of Ben Bernanke's "helicopter money" to the soulless American public, the bill also doles out $350 billion to states and municipalities, which, like the American people, don't need the money.

With COVID on the wane (is it really over?), depending largely upon where they reside, people are finally getting back to some semblance of normalcy in their lives, going back to work, getting their kids back into schools, and someday, maybe even taking off their stupid masks for a breath of fresh air.

But, the question remains, if the American public, states, and cities largely doesn't need the extra money, why then is congress doing this?

The answer depends on who you ask. Some will say it's all about control and conditioning people for the eventuality of Universal Basic Income (UBI). Others will say it's because there are still lots of people on unemployment and the bill provides another extension of supplemental unemployment insurance over and above the usual state levels. The most cynical will say it's all about greed, corruption, and graft, and that the bill is a payoff to local officials who helped put corrupted Democrats in power in last November's elections.

Whatever the case, people are going to spend that money, states are going to shore up their ailing pension funds, and money will be sloshing around the country for the next couple of months, most of it ending up in the hands of Wall Street investors or the stocks they buy. A bunch will go into, variously, bitcoin, gold, silver, guns, ammunition, food, and paying down debt.

It's a ludicrous thing, but there isn't a sane person in the world who, at this juncture, would pass up free money, and, since Wall Street has been getting it for years, it only seems fair to give the plebes a little taste.

The net result of this spending by congress will be another huge hole in the federal budget, already on track for a record-setting deficit, financed by the Treasury and Federal Reserve, adding to the already bloated $28 trillion debt already on the books. This bill will boost the debt beyond $30 trillion.

So, the outcome is already baked into the cake. Inflation will continue, as evidenced by the CPI release this morning, up 0.4% month-over-month, and up 1.7% on an annual basis. Food and energy led the way, leaving the "core" index (excluding food and energy) up a mere 0.1%. Over the past year, food is up 3.6%, energy is up 2.4%, but since these are government numbers, those should be regarded as base numbers, with the real impact higher and about to shoot even higher over the summer and maybe exploding into the fall.

When the CPI was released, stock futures responded positively, setting up the equity markets for an open on the upside. Another boost to stocks will come when the deal is done in congress later today and the money flow into the greatest bubble ever blown will carry on for a few more months.

They're already talking about another stimulus bill, later this year. The major indices are about to rocket to new all-time highs, so, enjoy the show.

Here's George Gammon explaining how the IMF's central planning for a new Bretton Woods is a very bad idea.

At the Close, Tuesday, March 9, 2021:
Dow: 31,832.74, +30.30 (+0.10%)
NASDAQ: 13,073.82, +464.66 (+3.69%)
S&P 500: 3,875.44, +54.09 (+1.42%)
NYSE: 15,375.63, +87.25 (+0.57%)