I wish they'd gone with a full point. Inflation really, really sucks.
Federal Reserve to increase interest rates by 75 basis points
311–320 of 329 posts
Re: Federal Reserve to increase interest rates by 75 basis points
#312What is being to address the price gouging by companies? Oil and gas companies are seeing record profits, how can it be just inflation that costs are going up?
There is really only one organization that price fixes oil and it's OPEC. Any individual oil and gas company has literally zero influence on the price of oil and gas.
That can't be true if the price of a gallon of gas varies even between gas stations in the same area. Sure there's local, state and national taxes and other fees, but it's clear that gas companies are adding on top of their costs otherwise they wouldn't be turning a profit. "Inflation" is also the perfect cover to raise prices, and it's true of other industries
Re: Federal Reserve to increase interest rates by 75 basis points
#313Earlier quoted context omitted.
The Russians curbed inflation at the start of the war quite effectively ... by raising interest rates to 20%.
Russia has stopped imports of many vital goods and industrial machinery, and the economy will likely seize up at one point after spare parts for machinery, etc. runs out
I think it depends. Talking with a friend in St Petersberg, last we talked about it was a few months ago so things can change, they are scrambling to bootstrap companies and industries. If they can successfully do that, it may not seize up. But here is the other side of that equation. Trying to stand up something like shops to machine parts in rapid fashion is going to end up with, yea they have parts, but they are low quality. So it may not completely grind to a halt, but it will still be crippling.
Now they could completely fail at bootstrapping those things, which yes, it will definitely grind to a halt. But any day now for the past 60-70 years Cuba was supposed to grind to a halt and well, they are still chugging a long. Maybe with lawn mower engines in their cars, but they still manage to get to point a from point b without walking.
Re: Federal Reserve to increase interest rates by 75 basis points
#314Earlier quoted context omitted.
> It's too difficult to curb demand for things like food and housing if the population is growing. It's also difficult (impossible) to curb demand for housing if housing is far and away the best investment you can possibly make, both in the short, medium, and long-term. Unfortunately, so many people in the west have their net worth tied up in their homes that policies directly targeting property values is political s…
> Unfortunately, so many people in the west have their net worth tied up in their homes that policies directly targeting property values is political suicide. I long ago concluded that the only way to escape high housing costs is to leave high cost of living places. No reform large enough to make a real dent is politically feasible, and in some overpriced cities the sheer amount of construction that would be required…
A decade ago I was offered two positions: one in NY and one in Raleigh, the former paying 20% more. I choose Raleigh, as I don't frequent Broadway shows and I can make a salad bowl myself. I also figured it preferable to be first in a village than second in Rome.
Re: Federal Reserve to increase interest rates by 75 basis points
#315I'm skeptical that interest rate hikes will curb inflation. I'm even skeptical that a recession will curb inflation. We have significant shortages of so many products and services that people rely on and the only way I see the situation improving is if supplies increase, maybe dramatically. It's too difficult to curb demand for things like food and housing if the population is growing. Those are things we just need t…
The Russians curbed inflation at the start of the war quite effectively ... by raising interest rates to 20%.
Prices for many items shot up like 50% at the moment the war started. So they "curbed" inflation from 50% to 48%.
Re: Federal Reserve to increase interest rates by 75 basis points
#316Earlier quoted context omitted.
There is really only one organization that price fixes oil and it's OPEC. Any individual oil and gas company has literally zero influence on the price of oil and gas.
That can't be true if the price of a gallon of gas varies even between gas stations in the same area. Sure there's local, state and national taxes and other fees, but it's clear that gas companies are adding on top of their costs otherwise they wouldn't be turning a profit. "Inflation" is also the perfect cover to raise prices, and it's true of other industries
There is the argument they are price fixing which is not true.
There is an argument they are turning a profit. Which is true.
But when oil prices are low they lose money hand over fist and lay off most of their workforce.
They have to make enough money in the good years to cover the bad years.
Re: Federal Reserve to increase interest rates by 75 basis points
#317Earlier quoted context omitted.
> It's too difficult to curb demand for things like food and housing if the population is growing. It's also difficult (impossible) to curb demand for housing if housing is far and away the best investment you can possibly make, both in the short, medium, and long-term. Unfortunately, so many people in the west have their net worth tied up in their homes that policies directly targeting property values is political s…
> It's also difficult (impossible) to curb demand for housing if housing is far and away the best investment you can possibly make, both in the short, medium, and long-term. With the population numbers in decline in the west (especially Europe), will there be enough demand in the medium and long-term for housing?
if we encourage immigration, yes
Re: Federal Reserve to increase interest rates by 75 basis points
#318I'm skeptical that interest rate hikes will curb inflation. I'm even skeptical that a recession will curb inflation. We have significant shortages of so many products and services that people rely on and the only way I see the situation improving is if supplies increase, maybe dramatically. It's too difficult to curb demand for things like food and housing if the population is growing. Those are things we just need t…
> I'm skeptical that interest rate hikes will curb inflation. I'm even skeptical that a recession will curb inflation. They won't, but the Fed has to do them anyway. That's the nasty situation we're in: current inflation is mainly being caused by supply shortfalls, which can't be fixed by interest rates short of massive demand destruction with a recession, but if the Fed doesn't do anything we could transition to a r…
they most likely will, if carried far enough
Re: Federal Reserve to increase interest rates by 75 basis points
#319Earlier quoted context omitted.
Regrettably, This is what does tend to happen. But its also a failure of society because immigrants are easy targets for scoring political points, despite it being repeatedly shown how beneficial immigration has been to Western econonomies.
Can you support that last claim? Might have been good for the S&P, but I'm not so certain the average joe off the street has seen said benefits. I could swear I recently saw a stat that locally born men in the US have only shared in like 3% of new job growth for the last decade or something like that.
lets say an innocent baby enters the world - this immigrant is not seen as much of a threat. you dont say "babys are taking things away from real Americans". just substitute "person" for "baby" and the benefits to the economy are not hard to posit.
adding humans to the economy is good. the pie gets larger. more tax revenue. etc etc etc
Re: Federal Reserve to increase interest rates by 75 basis points
#320Earlier quoted context omitted.
No. Easiest by far is to relax immigration restrictions.
The US has shattered record numbers of migrants crossing the southern boarder every month for over a year. It has had zero deflationary effects if anything it causes the supply to shrink even further as demand skyrockets. Migrants still need to be housed, feed, clothed and transported. There is no easy way out.
well we need millions of new people, and should be paying people to come here. there should be no such thing as "illegal" immigration.