History teaches us, don't let interest rates go below 2.5%.
Inflation is at a 40 year high. What can history teach us?
301–310 of 550 posts
Re: Inflation is at a 40 year high. What can history teach us?
#302In California, people fitting certain economic criteria are now being issued $1000 checks for inflation relief. This is beyond ludicrous. We have printed so much money, the only solution is to... print more? It's almost like it is all a sneaky backdoor to letting the government redistribute wealth without real oversight...
> In California, people fitting certain economic criteria are now being issued $1000 checks for inflation relief. This is beyond ludicrous. Its not. Its happening in Europe too. Its a way to try to get people through the winter and avoid the energy crisis impacting ordinary people. That's what a government should do - take care of its people during extraordinary times.
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Re: Inflation is at a 40 year high. What can history teach us?
#303Earlier quoted context omitted.
You keep claiming this, but it is fairly obvious that prices can be forced up by factors that have nothing to do with the money supply - most notably, constrained supply in basic raw materials (especially oil and its derivatives) can force virtually all prices up, regardless of the amount of currency available.
Not all prices at the same time.
Sure - goods whose production costs are not deeply tied to gas will not go up in price, or at least not as much. For example, software prices or services shouldn't immediately be affected if gas prices go up but the money supply stays relatively the same.
But electricity, gas, consumer goods, food, housing (via construction costs) - these will all go up, and they form the vast majority of consumer spending.
Re: Inflation is at a 40 year high. What can history teach us?
#304In California, people fitting certain economic criteria are now being issued $1000 checks for inflation relief. This is beyond ludicrous. We have printed so much money, the only solution is to... print more? It's almost like it is all a sneaky backdoor to letting the government redistribute wealth without real oversight...
California doesn't print money, the Federal Reserve does. California is required to balance its budget by law, like every state but Vermont. Nearly every state has more money than normal right now (some of it from high tax revenues due to nearly full employment, some due to federal stimulus), so they're finding ways of getting rid of the money. This is a second order effect from the much too large stimulus in 2020/20…
The only reason the states are afloat right now is because the federal government gave them hundreds of billions in printed money. So, yeah, it’s printed all the same.
1. Federal reserve makes several trillions in new money and lends it to the US Government.
2. The US Government passes “infrastructure” and “Covid relief” bills that shower billions on states and cities.
If not for this flow of printed money, most of the states would be cutting budgets since 2020.
So, yeah, a lot of it is printed.
Re: Inflation is at a 40 year high. What can history teach us?
#305Earlier quoted context omitted.
When I go to ford.com and look at their basic truck, the 2023 Maverick, I see "starting at $22,195". So if a 1962 truck truly sold for $2000, the inflation seems to account for entirely the price increase. And I'm pretty sure everyone will agree a 2023 Maverick is superior to a 1962 F-100 in every conceivable aspect. Housing and healthcare are better examples of goods or services whose prices have increased faster th…
I'd be surprised if you can get a truck at anywhere near MSRP these days. Trucks aren't a great example anyways because they're seen as a luxury good in the US today, which wasn't the case in the 60s.
Check the new car market again. Buyers have radically cut back as the economic uncertainty has proceeded since summer, plus the supply chain issues continue receding into the past.
Re: Inflation is at a 40 year high. What can history teach us?
#306Earlier quoted context omitted.
> In California, people fitting certain economic criteria are now being issued $1000 checks for inflation relief. This is beyond ludicrous. Its not. Its happening in Europe too. Its a way to try to get people through the winter and avoid the energy crisis impacting ordinary people. That's what a government should do - take care of its people during extraordinary times.
Quoted post unavailable.
Then try getting paid outside of civilized society. Unemployment will never be zero. An economy can't be 100% efficient. Taking care of those who cannot find work due to an imperfect system is a part of a civilized society.
Re: Inflation is at a 40 year high. What can history teach us?
#307Earlier quoted context omitted.
California doesn't print money, the Federal Reserve does. California is required to balance its budget by law, like every state but Vermont. Nearly every state has more money than normal right now (some of it from high tax revenues due to nearly full employment, some due to federal stimulus), so they're finding ways of getting rid of the money. This is a second order effect from the much too large stimulus in 2020/20…
You would think that there would be something more useful to do with the money, like fixing the infrastructure.
Fixing infrastructure is not always useful.
Infrastructure for low density suburbs is a money pit that bankrupts cities.
Here is a good playlist that explains why this is the case:
https://www.youtube.com/watch?v=y_SXXTBypIg&list=PLJp5q-R0lZ...
Re: Inflation is at a 40 year high. What can history teach us?
#308Earlier quoted context omitted.
"Safely" is relative, but here in Japan kerosene heaters are totally normal in older homes.
You can order indoor rated kerosene heaters on Amazon.
Devil's advocate though, you can order lots of unsafe (and outright fraudulent) items on Amazon. You can often order a "widowmaker" male-to-male power cable, fake UL-certified power strips and UPSs that catch fire, etc.
Re: Inflation is at a 40 year high. What can history teach us?
#309Earlier quoted context omitted.
> It doesn’t make sense to not buy the best house you can afford. I heard that a lot in the 2006-2007 era. And plenty of people lost that "best home they could afford" back then. Fortunately, I couldn't afford a four-figure car, much less a house - though some other grad students seemed able to convince someone to offer them loans. No idea how all those worked out, I do hope some of them were able to keep the houses.…
Buying a bigger house just allows you to park more of your net worth in real estate. As a diversification it makes sense. But also as you make more money the payment becomes less and less of your monthly income. It’s not absurd. It’s just a different reason for buying a house.
> It doesn’t make sense to not buy the best house you can afford.
I don’t understand how buying more of one thing is diversification.
Some idea that makes more sense to me is to buy 2 smaller houses, live in one and rent the other one.
This diversifies more and is an example that it can make sense not to buy the biggest house you can afford.
Re: Inflation is at a 40 year high. What can history teach us?
#310Earlier quoted context omitted.
Yeah but that’s not the whole picture… in 1962 the ford truck was $2000 now is around 40,000 so while a new one is better you still have to earn 2x as much to get the most basic one available
When I go to ford.com and look at their basic truck, the 2023 Maverick, I see "starting at $22,195". So if a 1962 truck truly sold for $2000, the inflation seems to account for entirely the price increase. And I'm pretty sure everyone will agree a 2023 Maverick is superior to a 1962 F-100 in every conceivable aspect. Housing and healthcare are better examples of goods or services whose prices have increased faster th…
With regards to differentiating prices of products by category over time, this chart looks relevant: http://www.roseassociates.ca/20-years-of-price-changes-in-th...
"The Price of Tomorrow" by Jeff Booth really nails this concept.