Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Federal Reserve raises rates by 0.75%

usatoday.com

Post reply on HN
Print view View original

291–300 of 593 posts

Re: Federal Reserve raises rates by 0.75%

#291

Post by jcadam »

Nemi wrote: post #182
Supermancho wrote: post #147

Earlier quoted context omitted.

People at my company have, in all-hands meetings. Is the company going to raise our salaries to compensate from the widely acknowledged inflation that's going on, given the company nets billions a year? No comment.

Companies rarely increase wages of existing employees commensurate with inflation. You get the appropriate inflation-adjusted increase only when you switch jobs. It is the one bit of leverage you have as an employee - I would suggest using it. Complaining to management feels good but gets you nowhere.

You direct supervisor likely will even sympathize, but these decisions are made in most companies by people who don't even know your name.

Re: Federal Reserve raises rates by 0.75%

#292

Post by whiplash451 »

jmyeet wrote: post #251

The returns that capital demands (and the government obliges to) are ultimately unsustainable. That's the core problem here. Rising wages? There has been no meaningful real increase in wages in 40 years despite a massive increase in productivity. Profits keep going up and up. The expectations for profits keep going up. The problem here is that the people who make companies possible don't get to share in the proceeds…

The Norway example is really annoying. It keeps coming back as an example to follow, when everybody knows it is a complete outlier that cannot be reproduced elsewhere.

Norway is sitting on a gigantic pile of offshore gas that it uses to generate massive profits that go into a huge fund they don't know what to do with, all of that for a 5M population that drowns into social programs.

There is literally no country in the world that has this ratio of natural resources $ / capita.

Yet, when you look at what Norway has actually produced over the past few decades in terms of innovation, companies, etc. the picture is very, very empty.

Re: Federal Reserve raises rates by 0.75%

#293

Post by upsidesinclude »

readams wrote: post #61
dnadler wrote: post #26

Something I haven’t seen discussed much is the impact of inflation on the existing federal debt. This is actually a positive for taxpayers as the federal debt will become cheaper. Obviously we’re still spending a ton and are issuing debt at higher rates now, so it’s not some kind of magic cure or anything.

Most of the debt is shorter term and must be continually rolled over. So when first moving from low expectations of inflation to high expectations, there is a temporary one-time gain, but after that the government will need to pay higher interest. And of course when the expectations return to normal there is a period when the government must pay higher than needed rates.

So the government just maxed out on an ARM they can't afford

Re: Federal Reserve raises rates by 0.75%

#294

Post by staticman2 »

timmg wrote: post #62
dnadler wrote: post #26

Something I haven’t seen discussed much is the impact of inflation on the existing federal debt. This is actually a positive for taxpayers as the federal debt will become cheaper. Obviously we’re still spending a ton and are issuing debt at higher rates now, so it’s not some kind of magic cure or anything.

Related (but different): I'm wondering how much inflation will shift tax payers into higher brackets and increase the overall income for the government from those taxes.

The marginal tax brackets are inflation adjusted every year.

Re: Federal Reserve raises rates by 0.75%

#295

Post by meragrin_ »

Aloha wrote: post #88
toomuchtodo wrote: post #83

Earlier quoted context omitted.

The Fed can only manage monetary policy. If Congress wants to fix the petroleum energy crisis with policy, it has the tools to do so.

High gas prices are mostly a function of insufficient refining capacity, short of the government building more, I dont see a policy fix here. The market is responding to the probability of an electric future.

> I dont see a policy fix here.

Relax regulations which prevent companies from building new or expanding plants?

> The market is responding to the probability of an electric future.

The "electric future" is so far out there. The fuel would likely just be exported. Also, fuel is not the only thing produced at refineries.

Re: Federal Reserve raises rates by 0.75%

#296

Post by treis »

queuebert wrote: post #176
ren_engineer wrote: post #156

Earlier quoted context omitted.

takes guts to do this and it was needed. Problem is that it will expose that most of the US economy is a sham that needed 0% interest rates to even fake growth. our "leaders" have been kicking the can down the road for a long time. US economy used to grow even with very high interest rates, now even a slight increase puts us into a recession.

Is this because of the transition to a service economy?

I think it's harder to distill qualitative improvement into a GDP number.

Take TV for example. Today you can watch Squid Games on your 65" 4k TV. 30 years ago you got to watch whatever was on cable on your 27" CRT. But where does that improvement get captured? We don't manufacture more TVs. In fact, we make fewer. We don't spend more money on Netflix than Cable. We actually spend less.

There's a lot of things like that where the quality has improved but that's hard to put an actual GDP number on.

Re: Federal Reserve raises rates by 0.75%

#297

Post by QuarterReptile »

moneywoes wrote: post #277
QuarterReptile wrote: post #137

Earlier quoted context omitted.

It's true that we are incrementally getting out of debt commitments by debasing the currency But as others have pointed out, bonds eventually come to term and then have to be rolled over into the higher prevailing interest rate. With such a high debt burden, that debt service can become a significant portion of all tax receipts, at which point all services are funded from deficit spending. 2021 tax receipts estimate…

So the other becomes raising taxes right? Or MMT?

I don't follow your parallelism. But yeah, you'd probably have to raise taxes to climb out of the hole we've dug. Or you could go for MMT (sticking your head in the hole.)

Re: Federal Reserve raises rates by 0.75%

#298

Post by Seanambers »

whiplash451 wrote: post #292
jmyeet wrote: post #251

The returns that capital demands (and the government obliges to) are ultimately unsustainable. That's the core problem here. Rising wages? There has been no meaningful real increase in wages in 40 years despite a massive increase in productivity. Profits keep going up and up. The expectations for profits keep going up. The problem here is that the people who make companies possible don't get to share in the proceeds…

The Norway example is really annoying. It keeps coming back as an example to follow, when everybody knows it is a complete outlier that cannot be reproduced elsewhere. Norway is sitting on a gigantic pile of offshore gas that it uses to generate massive profits that go into a huge fund they don't know what to do with, all of that for a 5M population that drowns into social programs. There is literally no country in t…

In Norway the state is rich. The people not so much. Best way for Norwegians to feel rich is to travel abroad.

Re: Federal Reserve raises rates by 0.75%

#299

Post by hamsand »

jmyeet wrote: post #251

The returns that capital demands (and the government obliges to) are ultimately unsustainable. That's the core problem here. Rising wages? There has been no meaningful real increase in wages in 40 years despite a massive increase in productivity. Profits keep going up and up. The expectations for profits keep going up. The problem here is that the people who make companies possible don't get to share in the proceeds…

No post body was provided.

Re: Federal Reserve raises rates by 0.75%

#300

Post by slaw »

paulpauper wrote: post #75

The fed is aggressively raising rates as the economy goes into recession. The last time something similar to this happened was in 1980. A very bad unusual situation, but on the other hand, the worst may be over. I think Google, Microsoft, Facebook, Amazon, and other large cap tech stocks are good buys at these levels and are more immune to macro factors (compared to other sectors ) and can hedge inflation by raising…

The Fed is very reluctantly raising rates, not aggressively. Fed interest rate is now 1.5%-1.75% with 8.6% inflation.
Post reply on HN