Here's something I've been thinking about for a few days. Suppose the government does a massive bailout of everyone. They guarantee jobs, they give everyone money so they don't run out. And it works. In a few months from now, the economy turns out to have just hit a speed bump and everything is back to how it was. What does that say about the economy? I mean if we can stop working and basically just lend ourselves mo…
maybe something along those lines would be mmt? https://en.wikipedia.org/wiki/Modern_Monetary_Theory
U.S. Jobless Rate May Soar to 30%, Fed’s Bullard Says
21–30 of 72 posts
Re: U.S. Jobless Rate May Soar to 30%, Fed’s Bullard Says
#22The question is how fast it will come down to full employment once this is over.
Denmark (I think) said that they'll freeze the economy, meaning that the state covers everything. Once over, it starts as if nothing happens. People will have no time to look for new jobs, they'll go to old ones and hopefully every company starts spending to support each other
Consumption will suffer. When foreign tourists stop booking rooms in Copenhagen hotels, how/why keep people on the payroll? Also, isn’t it dangerous to distort the market to such a level? Maybe there are more productive activities for those employees to engage.
There will be dislocations of the workforce. Considering the ongoing crisis I would take official statements with a grain of salt also. They need to convince people to comply with the rules.
Re: U.S. Jobless Rate May Soar to 30%, Fed’s Bullard Says
#23January 23rd, 2021: President Biden has signed into law the COVID-19 Works Progress Act as the first act of his presidency. It was passed easily in the democratically controlled house and senate the day following his inauguration. Calling for an immediate federal hiring surge at all levels of the newly implemented public health services, President Biden said “This act will restore salaries, dignity, and comprehensive…
please correct me if i am wrong, but i haven’t seen any evidence that joe biden would do such a thing he’s been pretty against medicare for all on grounds it “costs too much” just as one example, and just recently called for companies to stop stock buy-backs during covid-19 [0] but nothing like that ↑ afaik... [0] https://www.bloomberg.com/news/articles/2020-03-20/biden-cal...
“ Giving Americans a new choice, a public health insurance option like Medicare. If your insurance company isn’t doing right by you, you should have another, better choice.”
“ A decisive economic response that starts with emergency paid leave for all those affected by the outbreak and gives all necessary help to workers, families, and small businesses that are hit hard by this crisis. Make no mistake: this will require an immediate set of ambitious and progressive economic measures, and further decisive action to address the larger macro-economic shock from this outbreak. Biden believes we must spend whatever it takes, without delay, to meet public health needs and deal with the mounting economic consequences.”
Re: U.S. Jobless Rate May Soar to 30%, Fed’s Bullard Says
#24Here's something I've been thinking about for a few days. Suppose the government does a massive bailout of everyone. They guarantee jobs, they give everyone money so they don't run out. And it works. In a few months from now, the economy turns out to have just hit a speed bump and everything is back to how it was. What does that say about the economy? I mean if we can stop working and basically just lend ourselves mo…
What we need to do with coronavirus lockdowns is essentially to pause the economy. Cut all social contact off, let the virus run its course, develop a treatment or vaccine, and then reboot the economy. If the economy was healthy before (and most people say it generally was, despite a few doomsayers), that shouldn't be impossible. You could do it either by guaranteeing basic needs for the duration of the crisis, or by lending money on a short-term basis for the duration of the crisis, or by pausing all time-based payments like rent and debt.
Other economic recessions have had different causes:
2009 and 2001 were because the financial sector invested lots of money in unproductive sectors (real estate and dot-coms, respectively), and then that malinvestment needed to be written off and reinvested in more productive sectors of the economy before it could return to normal. That takes time, and it takes capital, and for people in the unproductive sectors it never happens. Tech started recovering in about 2011, while folks in coal mining or steel milling will probably never get their jobs back.
1973 was a supply shock. The price of oil went up rapidly. Everything else in the economy depends upon oil, or transportation using oil. Therefore, the price of everything else went up, and many marginal sectors of the economy were eliminated. All the massive bailout managed to do here was increase the price of everything.
1929 was a combination of everything going wrong. There was a speculative bubble during the 1920s which meant that a lot of capital was invested in Florida real estate, rum runners, consumer fads, and other unproductive sectors. There was a contraction of the money supply from 1929-1931 because the Fed screwed up. And then there was the dust bowl in 1931, which was a force majeure that added a supply shock.
Climate change is a much broader problem that affects the whole world. It'll likely result in massive migrations and productivity differentials across nations. If you have a free global market with porous national borders, the global economy will likely adapt, but there will be massive regional winners and losers. If you close the borders and try to deal with it on a national level, you'll probably get war.
Poverty is a consequence of liberty. If you let individuals make their own deals, some will inevitably make bad ones. Totalitarian regimes often have much lower inequality (excepting the ruling class), at the expense of everyone being poor. On an absolute level, even the poor in America are much better off than the rich in say the DRC.
Note that if the coronavirus isn't contained - if we just let people die instead of stopping it - we're likely to end up with a 1973-style supply shock rather than a graceful reboot. Except much worse. Labor is a factor of production for everything, and if people are dead, they can't work. When this happened after Black Death, the whole feudal system collapsed and we got the Rennaissance and modern market economy.
Re: U.S. Jobless Rate May Soar to 30%, Fed’s Bullard Says
#25Earlier quoted context omitted.
please correct me if i am wrong, but i haven’t seen any evidence that joe biden would do such a thing he’s been pretty against medicare for all on grounds it “costs too much” just as one example, and just recently called for companies to stop stock buy-backs during covid-19 [0] but nothing like that ↑ afaik... [0] https://www.bloomberg.com/news/articles/2020-03-20/biden-cal...
https://joebiden.com/healthcare/ “ Giving Americans a new choice, a public health insurance option like Medicare. If your insurance company isn’t doing right by you, you should have another, better choice.” https://joebiden.com/covid19/ “ A decisive economic response that starts with emergency paid leave for all those affected by the outbreak and gives all necessary help to workers, families, and small businesses tha…
that most appreciated, and a little encouraging (as much as a campaign page can be i suppose, caveat emptor and all that)
Re: U.S. Jobless Rate May Soar to 30%, Fed’s Bullard Says
#26Here's something I've been thinking about for a few days. Suppose the government does a massive bailout of everyone. They guarantee jobs, they give everyone money so they don't run out. And it works. In a few months from now, the economy turns out to have just hit a speed bump and everything is back to how it was. What does that say about the economy? I mean if we can stop working and basically just lend ourselves mo…
The problem is that we have stopped making stuff.
Once the warehouses all empty, there will be no more products. All those nice things you are used to buying to make your life nice and safe and clean and fun will be gone.
The infrastructure to even make the stuff will decay and be gone.
Printing money doesn't make products. It doesn't repair factories. It doesn't prevent the coming collapse of the prosperity we have enjoyed these last 100 years.
Re: U.S. Jobless Rate May Soar to 30%, Fed’s Bullard Says
#27The world has never experienced intentional economic dismantling on this broad of a scale.
Zimbabwe and Venezuela are the closest the world has ever seen.
In only three weeks, America, the richest country in human history, has been reduced to waiting in breadlines and praying that we won't starve to death. Our government is left trying to reassure the population not that there will be prosperity, but that there will be enough calories to prevent starvation.
Re: U.S. Jobless Rate May Soar to 30%, Fed’s Bullard Says
#28Here's something I've been thinking about for a few days. Suppose the government does a massive bailout of everyone. They guarantee jobs, they give everyone money so they don't run out. And it works. In a few months from now, the economy turns out to have just hit a speed bump and everything is back to how it was. What does that say about the economy? I mean if we can stop working and basically just lend ourselves mo…
The shortage of money is not the problem. The problem is that we have stopped making stuff. Once the warehouses all empty, there will be no more products. All those nice things you are used to buying to make your life nice and safe and clean and fun will be gone. The infrastructure to even make the stuff will decay and be gone. Printing money doesn't make products. It doesn't repair factories. It doesn't prevent the…
lots of people are tweeting that they are 3-4 weeks from disaster. that's some very special definintion of prosperity. These are numbers that come to mind when you think about middle age peasant.
Re: U.S. Jobless Rate May Soar to 30%, Fed’s Bullard Says
#29Earlier quoted context omitted.
The shortage of money is not the problem. The problem is that we have stopped making stuff. Once the warehouses all empty, there will be no more products. All those nice things you are used to buying to make your life nice and safe and clean and fun will be gone. The infrastructure to even make the stuff will decay and be gone. Printing money doesn't make products. It doesn't repair factories. It doesn't prevent the…
> It doesn't prevent the coming collapse of the prosperity we have enjoyed these last 100 years lots of people are tweeting that they are 3-4 weeks from disaster. that's some very special definintion of prosperity. These are numbers that come to mind when you think about middle age peasant.
You have no idea what medieval peasant life was like -- but you are going to find out
Re: U.S. Jobless Rate May Soar to 30%, Fed’s Bullard Says
#30Here's something I've been thinking about for a few days. Suppose the government does a massive bailout of everyone. They guarantee jobs, they give everyone money so they don't run out. And it works. In a few months from now, the economy turns out to have just hit a speed bump and everything is back to how it was. What does that say about the economy? I mean if we can stop working and basically just lend ourselves mo…
The shortage of money is not the problem. The problem is that we have stopped making stuff. Once the warehouses all empty, there will be no more products. All those nice things you are used to buying to make your life nice and safe and clean and fun will be gone. The infrastructure to even make the stuff will decay and be gone. Printing money doesn't make products. It doesn't repair factories. It doesn't prevent the…