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Federal Reserve raises rates by 0.75%

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521–530 of 593 posts

Re: Federal Reserve raises rates by 0.75%

#521
post #500
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…

Productivity has risen, but it isn't a tide tide that raises all boats. Look at what has boomed since the 70s, finance and tech. Finance because markets were liberalized and the economy financialized. They are at the junction where capital gets allocated in the economy, so they are able to take rents on all the capital that flows through them. The more money moving around the more they slurp up. Tech is where the lio…

> these were all policies that people wanted

What people wanted to send almost all labor intensive jobs like manufacturing overseas? Or sending almost all the production of semiconductors which are the primary building blocks of technology overseas? The corporate ownership? Yes. The vast population of citizens? No.

Do you realize that the United States mainly exports cardboard and oil plus a few car parts for BMW? While we import almost everything else.

Finance and tech remained because they are top-heavy industries that require only a few high paid people to execute the majority of those businesses. Bottom line is that this is not sustainable over the long haul. People will revolt as they fully realize that a basic task like buying their own property for their family is unachievable and other basic expenses like healthcare, rent, transportation, and food take up all or more of their income.

Re: Federal Reserve raises rates by 0.75%

#522
post #203

Earlier quoted context omitted.

> If those are the principal drivers of inflation, tightening could depress non-energy demand in a way that causes a recession without alleviating inflation You don't think the inflation has anything to do with printing $14 trillion out of thin air, or increasing the M1 money supply from ~4tn in march 2020 to over $20tn today? https://www.covidmoneytracker.org/ https://fred.stlouisfed.org/series/M1SL

Nope. I buy manufactured goods for a couple of businesses and everyone blames the price increases on supply issues. Also, Google MMT. Printing money is only inflationary of the economy is running near capacity.

MMT is far from fact, and I would go as far to say this little issue we're having disproves a good portion of it.

Re: Federal Reserve raises rates by 0.75%

#523

Earlier quoted context omitted.

> Economics is the lies told by some middle class assholes with a degree and/or credential that get paid just enough by upper class assholes to trick low class rubes. Why does nonsense like this get parroted so much? Economics is as much a science as any other social science. Which is to say that it's certainly imperfect and is subject to social problems surrounding science (e.g. the replication crisis), but it's sti…

The correct analogy would be the Healthcare system as a whole, and it would indeed hold water. Social sciences is a complete misnomer. It should be social theories, there's zero scientific basis for them. You can't compare the science of the physics of the universe to gender studies and economics. One studies the laws of the universe, the other simply talks about an irrational thing irrational beings created, and pre…

This is also Michel Foucault's critique of the Leninist-Marxist use of the word 'science'

Re: Federal Reserve raises rates by 0.75%

#524

Earlier quoted context omitted.

Inflation forces people to seek new jobs every few years. That is not necessarily a bad thing. The alternative is to have your boss decide for you when he wants to fire you.

> The alternative is to have your boss decide for you when he wants to fire you Just for fun, I thought I’d do the math on deflationary economics: #!/usr/bin/env raku use v6; multi sub deflate($n, $r, $y) { my $m = $n; loop (my $i = 0; $i Without inflation, your personal wealth would grow by the average inflation rate target plus GDP growth, compounding each year. Assuming an average inflation rate target of 2% per y…

Wow! Nice to see Perl 6 in use these days!

Re: Federal Reserve raises rates by 0.75%

#525
post #203

Earlier quoted context omitted.

> If those are the principal drivers of inflation, tightening could depress non-energy demand in a way that causes a recession without alleviating inflation You don't think the inflation has anything to do with printing $14 trillion out of thin air, or increasing the M1 money supply from ~4tn in march 2020 to over $20tn today? https://www.covidmoneytracker.org/ https://fred.stlouisfed.org/series/M1SL

Most economists don't think it's related, or at least a minor cause. Inflation is happening on a global scale right now. The biggest problem we've had is a breakdown of our supply chain because of the pandemic.

> Inflation is happening on a global scale right now.

All major global economies have been printing money at unprecented rates last couple of years.

Re: Federal Reserve raises rates by 0.75%

#526
post #432

Earlier quoted context omitted.

Ah the old patronizing saw "you just want free stuff"... no sir, I don't. I'm just playing another Game with a different equilibrium. One where everyone doesn't get to die for lack of health-care, like animals in the wilderness. One where my neighbor's education is not considered a threat to the small place under the sun I've managed to rip out of their hands, like predators quarreling for some spoils.

Hey who doesn't like free stuff. I like free stuff. Just pointing out not to get too used to it. History hasn't been kind to those who become too dependent on oil revenue, including in the form of distributions from the state. >"you just want free stuff" Ah the old patronizing "I invent a quote the person didn't say, and then I straw man against it like they did."

There is a difference between paying for things directly with oil money and buying a diversified portfolio with oil money and using the profits from that portfolio to buy things.

Re: Federal Reserve raises rates by 0.75%

#527
post #523

Earlier quoted context omitted.

The correct analogy would be the Healthcare system as a whole, and it would indeed hold water. Social sciences is a complete misnomer. It should be social theories, there's zero scientific basis for them. You can't compare the science of the physics of the universe to gender studies and economics. One studies the laws of the universe, the other simply talks about an irrational thing irrational beings created, and pre…

This is also Michel Foucault's critique of the Leninist-Marxist use of the word 'science'

Hadn't heard of that before, thanks for sharing I had to look it up. Many pseudo-sciences seem to do this to steal credibility.

For my downvoters, if you doubt what I said, take a look at this rambling incoherent mess that is this thread's comments.

No one can even describe our economy anymore due to the complexity, we have economic 'laws' that are no more than one person's opinion.

It's just a mess. I don't know what the solution is, but this ain't it.

Re: Federal Reserve raises rates by 0.75%

#528
post #521
post #500

Earlier quoted context omitted.

Productivity has risen, but it isn't a tide tide that raises all boats. Look at what has boomed since the 70s, finance and tech. Finance because markets were liberalized and the economy financialized. They are at the junction where capital gets allocated in the economy, so they are able to take rents on all the capital that flows through them. The more money moving around the more they slurp up. Tech is where the lio…

> these were all policies that people wanted What people wanted to send almost all labor intensive jobs like manufacturing overseas? Or sending almost all the production of semiconductors which are the primary building blocks of technology overseas? The corporate ownership? Yes. The vast population of citizens? No. Do you realize that the United States mainly exports cardboard and oil plus a few car parts for BMW? Wh…

It largely doesn't matter what the vast population of citizens wants, the various interest groups lobbied for their own things that all contributed what is going on. Regular citizens wanted policies that had consequential effects too, like housing, student loans and stimulus for example.

Finance was not a glamorous, high paid profession like Wall Street depicted before liberalization, it has only become what it is now after that, that is the change I am talking about. Most of the things that blew up either massively increased productivity or was adjacent to the financialization of the economy and benefited from the uneven expansion of the money supply via the Cantillion effect.

Re: Federal Reserve raises rates by 0.75%

#529

Earlier quoted context omitted.

I work remote and the thing that keeps me living in a relatively high CoL city is fear of being locked in if I'm fired and unable to find other remote work. Getting a mortgage in the country, for a tech worker, is basically a bet that either home values will stay high enough you can back out or that you'll be able to stay remote for the length of the mortgage.

If you lived in a high col city by default doesn’t that mean you live in a desirable area meaning you can likely sell your home? Or are you referring to a lease?

He's referring to if he (or the hypothetical you) moved to the country.

Re: Federal Reserve raises rates by 0.75%

#530

Earlier quoted context omitted.

>What we're allowing to happen here through investors buying up housing stock (and jacking up the prices), second homes, AirBnB and so on has reached the point of being a human rights violation IMHO. There are plenty of affordable places to live. People just don't want to move there. Buying a house in a hip U.S. city/suburb isn't a human right.

Why shouldn't we expect people who work in cities to be able to live dignified lives in those cities? There are always going to be janitors, home care providers, baristas, grocery store employees, etc. Our daily lives depend upon them. It's insane to me that we have a system that requires those people to exist but barely pays them enough to afford to live.

You end up with a permanent fight for the impoverished or less well off to move to the city to maybe get some table scraps.
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