Authored by Michael Maharrey via SchiffGold.com,

Prices are rising throughout the US economy. Federal Reserve Chairman Jerome Powell keeps telling us this inflationary surge is “transitory.” But transitory doesn’t mean what you think it means. The truth is higher prices are forever.

Here’s just a sampling of the price increases we’ve seen over the past few months.

Chipotle raised menu prices in June. Polaris, the company that makes Indian Chief motorcycles, snowmobiles and offroad vehicles, raised prices in May and is contemplating additional price hikes. Procter & Gamble, Coca-Cola, Kimberly-Clark, General Mills, Unilever, and other big companies have all raised prices.

Auto manufacturers are coping with skyrocketing costs another way. They are cutting back incentives, meaning the consumer ultimately pays more.

And then we have “shrinkflation” as companies sell smaller packages at the same price, or simply put less stuff in the same size box.

When Jerome Powell tells us these price increases are “transitory,” it sounds like at some point prices will drop back to “normal.” But that’s not what Powell means. Prices are never coming back down. He admitted as much during the press conference after the July FOMC meeting. Powell admitted “transitory” means that recent large price increases will stick, but that future price increases will revert back to 2% per year at some unknown point in the future. In other words, when you hear the word “transitory,” don’t think that means you’re going to get some price relief down the road. Prices will remain elevated. They’ll just go back to rising 2% a year instead of the 6 percent-plus we’re seeing today.

This is putting a tremendous drag on the economy. And not every company can simply pass costs on to their customers. Wolf Richter runs the WolfStreet website. He said he’s seen a massive rise in his costs.

In my little bailiwick, all the services I need in order to run my WOLF STREET media mogul empire have gone up in price: the costs associated with the dedicated server at a server farm, the costs of the email service that many readers subscribe to, the costs of the broadband service, which doubled  … The good thing is that WOLF STREET is supported by ads and donations and doesn’t sell anything, and so there are no price increases, and no shrinking or ballooning profit margins. I just eat the higher costs.”

Richter points out that a “buyers strike” would end the price increases. But “something big has changed.”

The whole attitude about price increases has changed. An inflationary mindset has set in. And this psychology of inflation tends to be persistent.”

That of course is the opposite of “transitory.” And it leads to an inflationary spiral. Richter said this is another reason to believe the inflationary environment we’re seeing today is anything but “transitory.”

The first bout of inflation always looks temporary. But during those first bouts of inflation, that’s when the triggers of persistent inflation, namely the inflationary mindset and inflation expectations are being unleashed.”

We’re left with two choices. As the dollar loses its purchasing power, we can either work more to maintain our standard of living, or we can work the same and sacrifice our standard of living.

Or we can just borrow more.

That’s really what the central bankers want. They keep interest rates artificially low to incentivize borrowing and spending in order to keep the economy propped up. And Americans have obliged. Consumer debt rose at a record pace in June.

Regardless of how you cope, the price hikes are here to stay. As Richter put it, “There is nothing temporary or transient in the loss of the purchasing power of the dollar, including of the labor dollar.”

Unwinding “transitory” inflation would require deflation. The Fed and the US government won’t allow that. In fact, the powers that be will tell you deflation is bad for you. So, as Powell admitted, the best we can hope for is that the inflation pace will “slow” to 2%.

Gee, thanks government!

Peter Schiff has been saying he doesn’t even think the Fed can bring the current bout of inflation under control. By the time the Fed gets around to tightening, it will be too little too late. On top of that, it will crash the fake economic recovery. The monetary policy driving inflation is the only thing holding the economy up.

Absent those monetary supports, the numbers would not be this good. They would be a lot worse if we didn’t have all the help from the Fed. And the Fed knows if they remove that help then everything is going to implode that’s been built on the foundation of artificially low interest rates and quantitative easing.”

So, if you’re waiting for prices to come down, don’t hold your breath. Transitory doesn’t mean what they want you to think it does.