[TheRealThing]

Germany learned what inflation can do to a nation the hard way. Now, Joe Biden is laying the groundwork for the U.S. to learn about inflation the hard way.

Deutsche Bank Issues Stark Warning About Rising Inflation: Economies Are 'Sitting on a Time Bomb'

Deutsche Bank said the U.S. may be headed toward one of its worst periods of inflation in history amid increased government spending and relaxed monetary policy, warning that the belief inflation is transitory could have serious consequences for the economy.

The report, which was released Monday, begins with a series of quotes—contrasting Ronald Reagan's warning about how serious inflation is with how Joe Biden, Janet Yellen and others have justified "acting big."

"Despite the shift in priorities, central bankers must still prioritize inflation," the report says. "Indeed, history has shown that the social costs of significantly higher inflation and greatly expanded debt servicing obligations make it hard, if not impossible to reach the social goals that the new US administration (among others) is keen to achieve. We fear that the vulnerable and disadvantaged will be hit first and hardest by mistakes in policy."

Deutsche took particular issue with the Federal Reserve's new framework tolerating higher inflation in order to reach a full recovery.

"The consequence of delay will be greater disruption of economic and financial activity than would be otherwise be the case when the Fed does finally act," Deutsche noted. "In turn, this could create a significant recession and set off a chain of financial distress around the world, particularly in emerging markets."

The bank also took an opposing view to the belief that the rise in inflation will be temporary.

"We are witnessing the most important shift in global macro policy since the Reagan/Volcker axis 40 years ago. Fiscal injections are now 'off the charts' at the same time as the Fed's modus operandi has shifted to tolerate higher inflation. Never before have we seen such coordinated expansionary fiscal and monetary policy. This will continue as output moves above potential. This is why this time is different for inflation," the report said. "The effects could be devastating, particularly for the most vulnerable in society."

In conclusion, the bank said the Fed's approach to inflation "leaves global economies sitting on a time bomb."

The detrimental effects of fiscal liberal lunacy are not limited to the US. In a world that is so connected, I cannot see how more than one global financial collapse could be remotely in the cards. Therefore in part, my concern as to the lateness of the hour from the prophetic standpoint. There have been numerous financial panics and depressions across time, but global financial collapse as far as I know is an unheard of occurrence in world history.