http://www.marketoracle.co.uk/Article4688.html
US Heading for Double-Digit Inflation
Martin D. Weiss | May 13, 2008
It was 1978. Jimmy Carter was president. Oil prices had been surging for nearly seven years. Other commodities — including silver, gold and food — were following closely behind. Wholesale prices, import prices and the price of critical resources were climbing swiftly.
Most important, the Fed’s pipe-smoking Chairman Arthur Burns, fearing a chain reaction of financial failures, pumped up the money supply with wild abandon, slashed interest rates — and set the stage for the worst U.S. inflation since the Civil War.
I saw it all, but I didn’t believe it. I assumed Burns would come to his senses, see the obvious danger of inflation and reverse course.
But I assumed wrong.
Burns plowed ahead regardless of all the signs. He gave lip service to fighting inflation, while continuing to print money. And sure enough, about a year and half after he left the Fed, consumer price inflation was roaring at double-digit rates.
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