The reminder came in the form of a worldwide surge in the interest rates paid by government bonds. The surge followed the spike in oil prices caused by the Iran War.

The rise in bond yields comes along with the news that, according to government statistics (which are manipulated to understate the real rate of inflation), consumer prices increased by 3.8 percent over the past year while wages increased by 3.6 percent. This means that, even though many Americans received nominal wage increases, their real (adjusted for inflation) incomes fell.

The decline in real income is why more Americans are maxing out their credit cards or carrying large balances on cards. The high interest rates on those cards trap many Americans in debt burdens from which they are unable to escape.

President Trump's "solution" to the economic problems facing many Americans is lower interest rates. Jerome Powell, who Warsh is succeeding as Fed chair, has refused to lower rates to the level desired by President Trump. This is a big part of why the president has said he chose not to reappoint Powell.

Concerns that Warsh would allow President Trump to dictate monetary policy help explain why only one Democratic Senator voted for Warsh's confirmation.

Lowering rates may slightly reduce credit card and other interest rates paid by consumers. However, it will further erode the dollar's value, thus further reducing Americans' real incomes and causing them to go further into debt.

The Fed also faces pressure to lower rates in order to monetize the over 39 trillion dollars and rising federal debt. Before the Iran War, the Federal government was projected to spend 16 trillion dollars over the next ten years just on interest on the national debt. That amount has no doubt increased thanks to the billions spent waging an unconstitutional war against Iran.

The Iran War has harmed economies around the world and could result in a global debt crisis as the disruptions cause governments to default on their debt. The disruptions could also lead to new challenges to a basis of the dollar's world reserve currency status — the petrodollar system linking the dollar to oil.

After President Nixon severed the last link between the dollar and gold, then-Secretary of State Henry Kissinger brokered a deal with Saudi Arabia where the Saudis would use only dollars for the oil trade in exchange for American military support. In recent years, interest in challenging the petrodollar and the dollar's world reserve currency status has grown. This is in large part because of opposition to the US government's use of the dollar's status to support the US government's sanctions.

The end of the petrodollar and the dollar's world reserve currency status will likely lead to major inflation as the Fed desperately pumps money into the economy to monetize ever increasing levels of federal debt. The good news is this could bring about the final collapse of the welfare-warfare state and the fiat money system that sustains it. While the short-term results of this collapse will be painful, if those of us who know the truth are successful in convincing a critical mass of people to support free markets, limited government, and a noninterventionist foreign policy, the crisis will lead to a new age of peace, prosperity, and liberty.