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Status:
"Do not pass GO, do not collect $300 (used to be $200)"
(set 8 days ago)
Location: TN
600 posts, read 274,154 times
Reputation: 385
It seems like across multiple channels, there's rarely a good framing. Seems like there would be a few components, each of which can be dug into deeper:
1. Commodities. What's the supply and demand? Is there less oil available (e.g. due to geopolitics). Is demand higher? E.g. coming out of lockdown? But maybe the coming out of lockdown should be accounted for already. Regardless, how is aggregate demand trending vs. supply? Notably, giving everyone $1000 wouldn't itself increase the supply of oil; people would just have more money to compete for existing oil (but, if a few of those people pooled $10 million into producing more oil, then that complicates things)
2. Currency. Mostly simple: more printing devalues existing notes. Attention to mechanics is important: if the liquidity initially goes to banks, for example, that won't automatically raise food prices. If the recipients deploy it to farmland or real estate, then prices would go up in those sectors.
3. Interest rates. If mortgage rates of 5% vs. 3% affects demand, then higher rates would suppress demand for that asset. This would need to be compared with the effects of #2. There's also a relation to #1, since e.g. financing new oil sources would be marginally hindered if interest rates are higher.
4. Labor. Holding out for money will likely result in either A: companies raising prices, contributing to inflation, or B: companies extracting less profit from labor. One can imagine that B would be described as horrible and must be dealt with by all means. Maybe A as well. Raising interest rates should slow down corporate capital investments, slowing down new job creation, or even leading to job losses - e.g. company sees existing debt is more expensive, and thus trims headcount. I'd wonder if limiting immigration likely boosts bargaining power and contribute to a share of inflation (not judging either way at present).
Hmm, writing it out, I see there is a bit of a challenge in laying it plainly. But the large networks with their abundant experts should be doing a better version of the above, if there's an interest in getting to the bottom of things. I'm very happy to receive critique on any of this; my agenda is simply to improve my understanding of things (and any attempts to mislead may be dealt with accordingly).
Quote:
Originally Posted by FordBronco1967
It only soared an inch, though!
I did not realize inflation was measured with a ruler!
As a mostly-gentleman, I'll make no comment on this at present
Only if you are believe the economy is in a moderate to severe recession. But Biden insists we are not going through a recession.
There would be hyperinflation, not a collapse. Easiest way to pay off that much money is to pay it with cheaper dollars.
This is unusual with low unemployment, corporations faring well and inflation above 8%. I expect an interest rate increase but need to wait a few months to see where this is headed.
There isn’t a magic bullet for inflation. It is quite simple to start and extremely challenging to stop. Governments will continue to introduce new aid initiatives that fuel inflationary pressures if they have a financial motive to grow their debt.
lol Spoken like a true economic amateur. Quit printing up money and keeping the interest rate artificially low. You know who says that? The ones who have been correct on the economy. You know who says what you posted? The ones who grow government and are always wrong.
Easiest way to pay off that much money is to pay it with cheaper dollars.
Bingo. Six months into the pandemic, we started house shopping. It was obvious two years ago that we were going to see this. You can't shut down 20% of the economy for months and not see an impact from that, and nobody's been doing anything about it since.
What's happening now fits perfectly with the Great Reset agenda. It's the controlled demolition of our economy, which is necessary to move the agenda forward. Whether you believe it's intentional or not, it is what it is. Add in that Biden adopted the pre-existing slogan of the Great Reset during his campaign - Build Back Better - and it becomes kind of obvious that it's all on purpose.
Anyway, yes, it's better to pay off debt with cheap dollars than expensive ones. We bought a house with land, a new roof, solar, a tractor and a TON of indoor and outdoor gardening equipment. Our house payment is already only about half of what an average NYC apartment rents for and will only go down, relatively speaking.
As for inflation, we started our business over 14 years ago. We've added service offerings but we've never raised our prices. In 14 years. We're going to have to do that this year, due purely to inflation. We really should've raised them earlier just to keep pace with our competitors, but we didn't need to, and I'm not the kind of guy who just takes as much as he can get.
It's not all that easy to start. You just have to shut down fossil fuels and spend like a drunken sailor. No president in 40 years did it until Biden.
I feel it is rather a case of severe dementia.
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