My lord it’s getting ugly.
And now they are going to gradually raise rates as well huh?
https://www.washingtonpost.com/us-policy/2022/04/11/fed-inflation-job-market/
So on one side you have prices rising and the other side, an artificial rise in debt service.
Perfect scenario for a crash. Squeeze em until they pop.
That along with a large portion of the population who simply doesn’t want to work. It’s getting rough out there.
I was told inflation is good and healthy
You never went to college, I’m assuming.
But, unemployment is at 3.6%. Even the U6 is shrinking significantly
As far as “that along…”, there aren’t a magical number of ways to fight inflation. You can raise interest rates to cut money supply and decrease bond prices, wage and price controls (which can’t happen here) and increasing the required reserve for banks. It’s not magic. It’s basic macroeconomics, semester 1.
Did you want a magic wand or perhaps some ruby slippers?
3.6%…….of the eligible population. There are a lot of people who can work but simply don’t want to.
How about don’t do the things that caused them in the first place?
How about don’t say it isn’t a problem when some bum off the street knows it is?
No, 3.6% of the eligible? What are you talking about? 3.6% is the U3, counting all people actively looking for a job.
The U6 counts all unemployed, including marginally attached workers, total employed part time for economic reasons, underemployed, etc. I showed the chart. U6 is around 7% right now I believe. Ya’ll have to get your economics “learn on”, seriously. Again, this is semester 1 Macro stuff
Not sure what you mean, but in general, inflation is caused by mass demand for too few goods or services. The mass spending by the government on private checks during the Trump years at the end, I think maybe one with Biden, don’t remember…coupled with the Covid supply chain cuts, Suez clog, etc…all limited the flow and ability of goods all the while the economies of the world were on pause and then exploded. I mean, none of this is like a Ray Bradbury story…no mysteries are involved. The fix for it just is. Increase required reserve, limit money supply / spending by raising interest rates. Nobody ever has the balls. Obama should have had them (or tried) to increase interest rates WAY back then. The following two did the same…just rode the bullshit to make their numbers look better. Now they have literally NO tools to fight a recession. For years, we’ve been riding the Greenspan “put”, which then became the Bernanke “put”, then the whomever “put” as a method for tackling a recession. They literally do not have a single tool anymore for that ridiculous policy, anyway.
The last cat who had balls and ran the fed was Paul Volker, and they forced him out over it while enjoying the “Reagan economy”, which wasn’t Reagan’s economy. It was Volker’s economy. Reagan still had 10.8% unemployment in 1983 and not a clue how to fix it other than telling corporations he’s taking oversight and burning it in the backyard, so have at it. That, of course, resulted in a steady flow of worsening recessions, massive deficits, debt, etc., thereafter.
That’s 1 way to create inflation.
Another way is to inflate the money supply.
And as I posted months ago, 40% of all US dollars have been printed in the past 2 years.
What you’re referring to is the monetarist perspective, not Keyensian economics. Dating back to Volcker, even Greenspan, they’ve clearly stated and outlined how monetary theory in looking at aggregate money supply is not affecting inflationary rates. We have quite a bit of data backing that up and disputing Friedman pretty soundly.
Also, you’re incorrect, again. You’re like a child who wanders into the middle of a movie and starts trying to tell everyone what’s going on.
40% of all money wasn’t “printed.” In fact, most of it wasn’t printed at all.
Most of that money was used by the government to buy assets and treasuries from the banks to keep them stable and to allow them to escape massive losses. You can debate that part all you want, but the fact is, the government still owns those assets and can sell them.
(Go ahead and check the print order archive from the Federal Reserve. They only printed notes worth $146 million in 2020 (Federal Reserve Board - 2020). For comparison, the Treasury printed $206 million in 2019 and $233 million in 2019 (more than 2020)).
Friedman taught that “inflation is always and everywhere a monetary phenomenon.” Our M2 is out of control at $21.6 trillion, up from $15.5 trillion in Feb 2020. To ease credit during the pandemic, the central bank helped increase money supply by $5 trillion by buying mortgage backed securities and then the Treasury sent out the checks to most Americans. But, as mentioned a big chunk of that money wasn’t spent. $2 trillion was parked in financial institutions’ accounts at the central bank. Americans are sitting on 2.7 trillion in savings. As David Beckworth stated, “the money supply went up, but the velocity went down.”
The Fed in the 70s set targets for the money supply to grow in line with economic activity. “If the amount of money available to the public in currency, coins, checking accounts, etc. exceeded the target, the Fed would raise interest rates to cool things off.” The reverse would take place if the supply grew too slowly. But for 3 decades, Fed chiefs have tracked prices and the labor market rather than the money supply to determine interest rates. They are claiming the link died about 40 years ago due to financial deregulation and innovations like interest-bearing checking accounts and mutual funds, meaning that traditional measures of M2 no longer provide the reliable signals.
most of this from a pretty solid article on it - https://www.washingtonpost.com/business/2022/02/06/federal-reserve-inflation-money-supply/
Imagine being this guy.
First, he claims I didn’t go to college, which is a flat out lie (integrity).
Then, he claims there’s only 1 way to inflate an economy. I offer him an alternative. One that is sound and also back with reason and data.
And this guy calls me a child WHILE SAYING CHILDISH THINGS BECAUSE HE WAS CHALLENGED.
Imagine being so pathetic.
Even if you went to college, you didn’t retain any knowledge.
He already flew circles around point 2. You have no counter?
You’re lying. I asked if you went to college, you never answered. That’s a flat out lie about my lying. Like I’ve said before, you have zero integrity.
No data provided, yet data points within the article provided prove monetary theory is moot when it comes to inflation and is backed by over 40 years of Fed policy and examples.
Another lie.
Another lie. Statement provided below
You’re like a child who wanders into the middle of a movie and starts trying to tell everyone what’s going on.
It’s called a simile. It’s a figure of speech. Though, I know you don’t believe in definitions, Dictionaries, literally any astronomical information that doesn’t predate 5th century Greece, that Qanon is real but election results aren’t…but, reality moves on without you. You have every right to be the moron you’ve decided to be in life. Go on with your bad self!
4 lies in 1 post…the true display of being pathetic.
I have a bachelor’s in Management Science, my Series 6, 63, + Life and Health, and varying State Certifications. Like I said- you’re a liar.
And you’re a dummy + a liar.
You’re projecting. This is LITERALLY what you’re doing on OUR fan message board. Loser.
Despite knowing that you don’t accept the concept of definitions, again, you’re showing to be dishonest. Again, I asked if you went to college. You just finally answered. Dictionaries are your friend. Words have meanings.
Within your own link, it shows the same thing I was stating and the same thing the article I posted was stating…from the difficulty in measuring money supply, the velocity of circulation, to the liquidity trap.
Also, you started the entire post by stating that raising interest rates while in an inflationary period is the “perfect scenario for a crash.” As I’ve stated, you’re an idiot. By every measure, through each economic theory from monetarist to Keynesian, the methods to fight inflation are the same. Raising interest rates is the primary method to begin with.
From the WP article
So, we’ve shown how the point you were making is not correct. You’re citing inflation as a problem then saying raising interest rates is bad and is the scenario for a crash. Basic economics shows raising interest rates as the primary form of tackling inflation, thus showing you don’t know dick about basic macroeconomics. Then, you singularly blame money supply over inflation, ignoring the velocity, my comment about required reserves at banks…and you offer literally nothing in terms of your opinion as to how to fight inflation, being that you consider yourself the expert above experts on every subject, Cliffy.
Awww…and there it is. “OUR” board, huh? Are your feelers hurt, little guy? I wonder how I found this board. Wonder who could have directed me to it and invited me in…hmmmm?
Nope- didn’t say this.
I said this inflationary event + raising interest rates concurrently, was the perfect scenario for a crash.
Once again- liar.
Thanks for proving what I really said.
Inflation PLUS ARTIFICIAL RATE INCREASES will squeeze us.
I’ve bolded the part that shows GSClown pays zero attention or is willingly ignorant with anything related to monetary policy.
You don’t even need to read anymore. He acts like they just rolled out of bed and decided to raise rates that morning. Lol
Raising rates has been a hot topic with inflation for a couple years now. Conversation shifted quite some time ago to not “if” but “how much” and “how quickly.”
