• Quick note - the problem with Youtube videos not embedding on the forum appears to have been fixed, thanks to ZiprHead. If you do still see problems let me know.

Inflation

lobosrul5 said:
But 70's era stagflation also saw high unemployment, this time we have inflation with almost full employment. Like literally any able bodied person can get a job right now. At least where I live, there are signs to apply now, get paid at the end of your shift TODAY. Also 70's supply shocks were pretty much just oil unless I'm mistaken , what we are dealing with now is much more complicated. Not to mention the negative yields, which have never been this bad at least going back to 1900. This is... something different. I'm afraid the FED is going to wait to late to raise rates for fears it will hurt the stock market and by then inflation is going to be out of control.
Click to expand...
In the 70s, inflation took off first in the wake of the oil crisis and unemployment took off in its foot steps afterwards.

What happened in the 1970s may not be directly translatable to the 2020s but the point is that both scenarios are the opposite of what happened in the GFC of 2008.
 
I got a haircut a few days ago and they had a large sign in the window: "Help wanted, $2,000 Signing Bonus."
 
lobosrul5 said:
Analysis I'm seeing here is, a bunch of people retired earlier than they would've pre COVID, huge return on their 401k/IRA made it possible.
Click to expand...

That may be some of the issue, but it pales into insignificance against the migrant workforce. NZ is in the same worker shortage and none of those apply here, while the migrant force does.

Probably all needs deeper analysis.

marting said:
I got a haircut a few days ago and they had a large sign in the window: "Help wanted, $2,000 Signing Bonus."
Click to expand...

Yeah, we're doing the same here. I'm dealing with companies that will put $5000 up front.
 
Brainster said:
I do think MMT is horse crap and is about to be exposed as such.
Click to expand...


Actually, MMT doesn't really differ all that much from MT. It predicts that in a
strong economy more government spending results in inflation. Obviously, the
solution for inflation involves the destruction of money though a process raising
taxes and paying off government bonds.

Unfortunately, the Federal Reserve cannot raise income tax rates, and MMT
never gets fully implemented. So, inflation here we come.


lobosrul5 said:
Like literally any able bodied person can get a job right now. At least where
I live, there are signs to apply now, get paid at the end of your shift TODAY.
Click to expand...


I some areas of the United States, but in other areas employers put structural
barriers in the way.


Why Millions Of Job Seekers Aren’t Getting Hired In This Hot Job Market by Heather Long and Eli Rosenberg

Complicating the job search for the long-term unemployed is the explosion
of companies using robots to sort through job applicants, at least in the first
round. This highly automated process excludes anyone who is not a near perfect
fit on paper for a job. Nearly half of employers say they quickly reject candidates
who haven’t worked in more than six months, according to a recent Harvard
Business School study.
Click to expand...
 
Last edited:
The Atheist said:
Commodity prices are insane, with Russia having a major affect on wheat as well as energy.

Wheat up 100% in the past two years.
Click to expand...

Is there something US farm policy can do to affect the situation? For years I heard that the government was incentivizing low production as a price support. I've been out of touch with that for quite a while, is that still a thing? And can we turn the dial the other way?
 
Meadmaker said:
Sigh.

Last year, two presidents decided to throa a bunch of money at us to stimulate the economy. Awesome, except that, at the time, I noted the reason for the bad economy was that people weren't buying anything, because they weren't allowed to, or because they were afraid to go to stores to find the stuff, much less get on airplanes and spend it on hotels.

So now we've go tons of money, enough that we can buy lots of stuff, but still not travel or attend entertainment options, so instead we're buying tons of stuff that have to be loaded onto trucks, and we're out of trucks.

And eventually, the marketing departments say, "I think people will buy this stuff even if we raise prices by 5 %, so they do.....and just as I am about to start pulling money out of my retirement fund and not have another income, we return to those glorious days of yesteryear, when inflation was just considered normal.

Bah.
Click to expand...

Is there any evidence to support this? The much more obvious cause of inflation is the massive disruption of global supply chains these last few years have seen, namely as a result of covid and further exasperated by the war in Ukraine.

China notably has not been following the West's "let everyone catch covid and maybe die" approach, instead instituting severe lockdowns whenever cases are detected. Since much of the world's supply chains involve China, these disruptions of their workforce are quite profound.

War sanctions against Russia and OPEC acting like the opportunistic cartel it is has resulted in shortages of fuel, which drives the prices of nearly everything up as well.
 
Last edited:
Yes the 1,200 dollars poor people got to survive is obviously the problem.
 
The Atheist said:
The '70s & '80s inflationary period was pretty well worldwide.
Click to expand...

The fix for it everywhere was to tighten the money supply which has the effect of increasing interest rates. There was a lot of economic pain but it did bring inflation under control
 
This is why inflation is so high right now. There has been a 500% increase in the M1 money supply, most of that coming in Apr 2020. The April 2020 expansion was probably a mistake IMO. While money supply expansion a normal response to an economic downturn, the issue in April 2020 wasn't money supply it was Covid. Increasing money supply at that point wasn't going to have a big economic impact but we are feeling the effects now in the form of inflation.

picture.php
 
JoeMorgue said:
Yes the 1,200 dollars poor people got to survive is obviously the problem.
Click to expand...

I wasn't poor. I got the same money. And if you only got 1200 dollars, you need to contact the IRS right away. You are missing some money.

I don't know to what extent that contributed to inflation. I think Lomiller's data is probably more significant. The "stimulus" of the last couple of year, in addition to all the other stuff like "quantitative easing" and a debt level that is ove 100% of GDP probably played a role.

The war in Ukraine certainly doesn't help, but prices were rising before that appeared on the horizon.
 
In addition to Covid and Ukraine and supply chain issues, unemployment is about at a 50 year low. While low unemployment is a very good thing, it does lead to higher inflation. However, the inflation we are seeing now is too large to be explained only by the low level of unemployment.
 
Meadmaker said:
I wasn't poor. I got the same money. And if you only got 1200 dollars, you need to contact the IRS right away. You are missing some money.

I don't know to what extent that contributed to inflation. I think Lomiller's data is probably more significant. The "stimulus" of the last couple of year, in addition to all the other stuff like "quantitative easing" and a debt level that is ove 100% of GDP probably played a role.

The war in Ukraine certainly doesn't help, but prices were rising before that appeared on the horizon.
Click to expand...

I don't think it's the money supply or the national debt. I think it's supply chain problems and the war in Ukraine, and the policy responses to the war (sanctions). It's necessary pain though.

What did you do with your stimulus check(s)? Increase your spending or put it in savings for a rainy day? I certainly didn't run out to spend more money than I would have anyway just because I got a check from the government.
 
lomiller said:
This is why inflation is so high right now. There has been a 500% increase in the M1 money supply, most of that coming in Apr 2020. The April 2020 expansion was probably a mistake IMO. While money supply expansion a normal response to an economic downturn, the issue in April 2020 wasn't money supply it was Covid. Increasing money supply at that point wasn't going to have a big economic impact but we are feeling the effects now in the form of inflation.

[qimg]http://www.internationalskeptics.com/forums/picture.php?albumid=1373&pictureid=13070[/qimg]
Click to expand...

If I'm not mistaken, that big jump was not a true change in money supply, but a shift in the definition of M1. Or am I thinking of a different event?
 
You must log in or register to reply here.

Back
Top Bottom