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The anti-inflation pivot of 2022

adamtooze.substack.com

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Re: The anti-inflation pivot of 2022

#231

Post by stickfigure »

buscoquadnary wrote: post #73
spywaregorilla wrote: post #30

I think the US (and Canada) just needs to ride the tide and let all the other boats sink. Pretty much everyone else is screwed. I think people are underestimating the second order effects of the US still having stable energy and farming capabilities. We'll see more stuff get done here and less stuff done elsewhere. Unemployment will be great here no matter what we do really. It will suffer in other countries. Though…

This is the basic premise of this talk by Petar Zeihan https://www.youtube.com/watch?v=Wi_nFz1CJSI&t=2s

The narrative of "the NATO closet is bare" has been pretty thoroughly debunked:

https://www.youtube.com/watch?v=7CmXz8Qd9yw

(I highly recommend Perun's channel for analysis of the Ukraine war)

Also, it's a bit hard to take seriously someone that says "so no jets, no F-35, no battleships". Sure it's a throwaway line but it seems like someone trying to communicate something serious wouldn't refer to literal battleships, which nobody in the world uses anymore. It's not something that Perun would say.

Re: The anti-inflation pivot of 2022

#232

Post by somewhereoutth »

spookthesunset wrote: post #120
groby_b wrote: post #111

Earlier quoted context omitted.

... assuming there are no further variants, and hand-waving long covid away, sure, it's settled. I think we'll find that just like reports of Mark Twain's death, rumors of the end of the pandemic are greatly exaggerated.

> rumors of the end of the pandemic are greatly exaggerated. Only if people are stupid enough to repeat the last two years of nonsense. Take away all the fear mongering and testing and you probably wouldn't even notice covid was a thing. You'd get sick like you always do and just shrug it off as "that thing that was going around" like we all did in 2019...

Yes how dare the plebs stay home to avoid dying when they should be toiling in the fields and factories so we can continue in the lavish lifestyles to which we've become accustomed.

Re: The anti-inflation pivot of 2022

#233

Post by somewhereoutth »

spookthesunset wrote: post #222
groby_b wrote: post #171

Earlier quoted context omitted.

Neither deaths nor disability can be wished away by "just behaving as if it's normal". As for "continuing lockdowns" - most of the western world hasn't had a single actual lockdown. So let's not pretend that's the issue, or a desired approach to the problem. What is needed is - data transparency, instead of reduced data collection. - targeted measures, instead of blanket measures. Utilizing the above data, and focusi…

You are right. Forcing “non essential” small businesses to close, stopping all events, closing churches, parks, playgrounds, schools, making it illegal to walk on “the dry part of the sand”, disallowing dying people to have visitors, forcing hospitals to stop taking elective surgery, arresting people sitting on benches,etc… these all just ordinary things… right? Definitely not a “lockdown”, right? What is a lockdown…

and they closed Wendy's too!

Re: The anti-inflation pivot of 2022

#234

Post by prottog »

JPKab wrote: post #141
spywaregorilla wrote: post #30

I think the US (and Canada) just needs to ride the tide and let all the other boats sink. Pretty much everyone else is screwed. I think people are underestimating the second order effects of the US still having stable energy and farming capabilities. We'll see more stuff get done here and less stuff done elsewhere. Unemployment will be great here no matter what we do really. It will suffer in other countries. Though…

Mexico will be fine as well. North America is in a pretty good place compared to the rest of the world when it comes to energy/food/labor demographics. China is, unfortunately, a long way from the competent leadership of Hu Jintao and the other previous post-Mao leaders. Unlike the previous leaders (primarily selected on merit), who WANTED to prevent another Mao-like cult of personality, Xi is a deeply-insecure man w…

This is why any system of government that relies on an unbroken chain of good leaders, as opposed to limited government with systemic safeguards, is bound to fail, and often times sooner rather than later.

Re: The anti-inflation pivot of 2022

#235

Post by prottog »

drekk wrote: post #203
JPKab wrote: post #141

Earlier quoted context omitted.

Mexico will be fine as well. North America is in a pretty good place compared to the rest of the world when it comes to energy/food/labor demographics. China is, unfortunately, a long way from the competent leadership of Hu Jintao and the other previous post-Mao leaders. Unlike the previous leaders (primarily selected on merit), who WANTED to prevent another Mao-like cult of personality, Xi is a deeply-insecure man w…

China has 4x the population of the US. Abandoning zero COVID as a policy would lead to millions of deaths. How can you call SinoVax a failure when all of the non-mRNA vaccines perform similarly? The US has more COVID deaths than China has had cases. That's shameful, especially when the US sat on enough mRNA vaccines to completely immunize our population 9x over. Countries like Argentina that were guinea pigs for the…

> a billion+ humans as inept drones under the iron grip of a tyrant

Drones, no, but it's very instructive to look at what the elites of China do. Many who achieve success in China spend significant resources to have a foot out the door, because they know that success is fleeting, depending on remaining in favor of the CCP. Even Xi Jinping's daughter went to school in the US.

If the CCP is actually so benign and China is well run and a good place to be, why does that happen?

Re: The anti-inflation pivot of 2022

#236

Post by prottog »

Analemma_ wrote: post #134
kansface wrote: post #108

Earlier quoted context omitted.

Interesting. Do you know why mortgages in Canada are so different from the US? They seem much more risky on the buyer’s side.

Nobody but the United States has long-term fixed rate mortgages: they're horrible for lenders because the lender has to assume all interest rate risk. The reason they exist in the US is because the government acts as a backstop due to pro-homeownership politics, but it causes a bunch of market distortions that are made invisible to American borrowers.

> a bunch of market distortions that are made invisible to American borrowers

Anyone who has taken a five-minute look at the real estate market in any major US city can see those market distortions plain as day.

Re: The anti-inflation pivot of 2022

#237

Post by somewhereoutth »

jmyeet wrote: post #8

Here's the lesson I want people to learn: we had 40+ years of stagnant real wages (overall; there are exceptions). What happened in the pandemic was: 1. People realized going into an officce to work was unncessary and even anachronistic for many jobs; 2. Employers like employees in the office as a form of control; 3. Employers made short-term decisions to lay off huge amounts of people (even after taking PPP loans fo…

I agree, but interest rates have to return to a natural level (where risk is priced correctly), and thus reset asset prices (to better reflect their true returns).

Re: The anti-inflation pivot of 2022

#238

Post by mdcds »

unholiness wrote: post #219
mjburgess wrote: post #7

This article appears to take place in a universe where interest rates at central banks are at counter-inflationary levels. They've been inflationary for a decade, and continue to be so. With inflation at 10%, fears about "going too far with interest rates" make sense only *at least* north of 5%, and realistically, 8%.

Macroeconomics novice here. What's the argument that interest rates need to be close to inflation rates to counteract it? It seems like there should be an intrinsic time-value of money (e.g. 1 stuff today is worth 1.05 stuff next year) which is tradable (supply of future-stuff will equal demand for future-stuff at some rate like 1.05). And that single rate of stuff-interest would exist if the central bank does nothin…

I had the same question!

The mechanism of higher rates reducing inflation isn't clear to me.

Does it go down because people with cash choose to park it and earn interest instead of buying goods and services? Or does it go down because higher interest rates make the cost of doing business more expensive which leads to reduction in overall business activity?

If it's by reducing business activity, then seems like the "breaking point" can be at any arbitrary interest rate for a given country in a given year.

Also, if inflation is caused by the lack of supply (like the supply chain issues / chip shortage and such), then I think reducing business activity will only exacerbate the problem by reducing the supply further (and I don't hear anyone explore this angle).

Re: The anti-inflation pivot of 2022

#239

Post by prottog »

blagie wrote: post #188
roflyear wrote: post #54

Earlier quoted context omitted.

To safely park cash. Think government securities.

This is correct. If you have $100B, what are your options? 1) Risky return-yielding instruments, like stocks and bonds 2) Non-liquid assets, like land 3) A Scrooge McDuck giant vault full of cash 4) ... and so on. In many cases, a negative interest account works better than any of the above. Sweden was the first to employ them in 2009, with an interest rate of -0.25%. The world didn't implode, as people predicted. If…

> That's enough to push me to look for other places to stash my money

Yep, you take your $100B and invest it in the US capital markets. Does nothing for Sweden's economy other than make it comparatively less competitive.

Re: The anti-inflation pivot of 2022

#240

Post by prottog »

somewhereoutth wrote: post #232
spookthesunset wrote: post #120

Earlier quoted context omitted.

> rumors of the end of the pandemic are greatly exaggerated. Only if people are stupid enough to repeat the last two years of nonsense. Take away all the fear mongering and testing and you probably wouldn't even notice covid was a thing. You'd get sick like you always do and just shrug it off as "that thing that was going around" like we all did in 2019...

Yes how dare the plebs stay home to avoid dying when they should be toiling in the fields and factories so we can continue in the lavish lifestyles to which we've become accustomed.

> how dare the plebs stay home to avoid dying

Covid mortality rates for those in the working age are meh. More people died of accidents than everyone under the age of 55 from Covid.

> so we can continue in the lavish lifestyles to which we've become accustomed

We should just tax the rich instead, which of course is the true source of that lavish lifestyle.

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