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Setelinleikkaus: When Finns snipped their cash in half to curb inflation

jpkoning.blogspot.com

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Re: Setelinleikkaus: When Finns snipped their cash in half to curb inflation

#181

Post by jpkoning »

lbotos wrote: post #173
jpkoning wrote: post #163

Earlier quoted context omitted.

"What happens next is that they buy and sell government bonds in the open market." This describes how central banks operated in the U.S. before 2008 and in Canada before the 1990s. The Federal Reserve and the Bank of Canada both set a target for the overnight interest rate, and then they hit that target by doing open market purchases (or sales) of bonds, effectively adding funds to (or draining funds away from) the o…

You make it sounds like they aren't doing regular open market operations, but as I understand it... they still do? https://www.newyorkfed.org/markets/domestic-market-operation...

The Fed still does purchases and sales, but not for the purpose of driving the overnight interest rates towards its target. The level of the overnight rate is not affected of any purchases or sales that the Fed does.

Re: Setelinleikkaus: When Finns snipped their cash in half to curb inflation

#182

Post by stickfigure »

akira2501 wrote: post #147
pjc50 wrote: post #4

Mentioning the war on COVID but not the actual war between Russia and Ukraine that caused a huge spike in European energy prices is a big omission, since that caused a lot of global inflation.

The embargo caused the spike. Which makes having thrown away a workable peace deal a criminal act.

I think the phrase you are looking for is "Peace for our time".

Re: Setelinleikkaus: When Finns snipped their cash in half to curb inflation

#183

Post by Supermancho »

rf15 wrote: post #140
xadhominemx wrote: post #122

Earlier quoted context omitted.

You are correct. Striking how many HN commentors are so often confident and yet wrong...

You are wrong. Striking how many HN commentators are so often confident and yet wrong in their assumption that everything is about the US.

> You are wrong.

Wrong about what? This is about the US Fed, in context of...well you can read the thread.

Re: Setelinleikkaus: When Finns snipped their cash in half to curb inflation

#184

Post by toast0 »

teractiveodular wrote: post #17

A recent similar example was the Indian move in 2016 to demonetize the ₹500 and ₹1,000 notes with very little notice, which is in retrospect widely viewed to have been a disaster. https://en.wikipedia.org/wiki/2016_Indian_banknote_demonetis...

Wasn't that contemperaneously viewed to be a disaster?

I have to wonder if there was a unspoken real reason they did it, because it was obvious anybody with lots of demonitized bills would farm out the redemption if necessary, and wikipedia reports 99.3% of notes were redeemed. Maybe the 0.7% was (some of) the black money that was targetted, or maybe that's a normal amount of lost and damage beyond redemption.

Otoh, maybe there was some highly classified but credible advance notice that the crimimal underground was about to start printing credible 500 INR notes en masse.

Re: Setelinleikkaus: When Finns snipped their cash in half to curb inflation

#185

Post by Aloisius »

akira2501 wrote: post #162
jeroenhd wrote: post #160

Earlier quoted context omitted.

As unrealistic as it may be, “Russia gives back the stolen land and pays reparations” sounds like a workable deal if Russia itself suffers for long enough. Or maybe Russia will leave Ukraine if we give them all the land and assets owned by the “Ukraine should make a deal with Russia” people, as they're of the opinion that placating an invading army is the best way to peace.

> if Russia itself suffers for long enough. Do you want Russia, a geopolitical entity, to somehow measurably suffer, or do you want an end to pointless bloodshed? Are you willing to put your own life to this lofty goal? > placating an invading army is the best way to peace. If you're not capable of repelling the invasion effectively, then yes, this is absolutely true. How could it not be? There's no reason that you c…

Did US appeasement of Russia after the annexation of Crimea bring any kind of lasting peace?

Why anyone would think this time it would be different when what Russia wants hasn't changed is beyond me.

Re: Setelinleikkaus: When Finns snipped their cash in half to curb inflation

#186

Post by will4274 »

zimpenfish wrote: post #87
ajsnigrutin wrote: post #22

Earlier quoted context omitted.

In my ~2mio pop country, by the end of restrictions, we had (iirc) 5 people in the "below 35" age group what died 'with covid' (not necessarily because of it). For comparison, that's way less than traffic deaths. Even way less than suicide rates in that age group (and we all know how bad the lockdowns were for many peoples' mental health). We also had a 20yo girl die because of vaccine-induced clots. She got vaccinat…

> In my ~2mio pop country, by the end of restrictions, we had (iirc) 5 people in the "below 35" age group what died 'with covid' By way of contrast, as of 2023-04-28[1], England had 157 deaths per 100k in the "below 30" age group. Which on a population of 57M[2] gives about 89k deaths. Your ~2mio pop country did exceedingly well if your numbers are correct - scaled to England, you'd have expected about 3000 deaths. […

You've misunderstood and misread your source. The data shared is "total deaths" and "mortality rate per 100k", not "total death and mortality rate" per 100k. It's 157 total deaths in the below 30 group, and 4.2 per 100,000 in the 20-29 range.

For what it's worth, you might consider reflecting on this. Your interpretation was off by a factor of 100, and you didn't notice! That suggests you are staggeringly misinformed about one of the most important events in recent history. It's akin to somebody saying that the military was only 0.1% of the US budget, or that foreign aid was 20% of the US budget. The only reasonable conclusion is that the speaker is totally uninformed on the topic.

Re: Setelinleikkaus: When Finns snipped their cash in half to curb inflation

#187

Post by [deleted] »

G3rn0ti wrote: post #165
CraigJPerry wrote: post #155

Earlier quoted context omitted.

>> This is what drove and still drives inflation directly and indirectly QE is fascinating. On the one side of QE you have central banks, absolutely baffled by the fact they create all these reserves, we’re talking utterly un-relatable numbers for a human, numbers that belong in the field of astronomy rather than finance. And yet they fail to hit their inflation targets for over a decade. On the other side you have a…

> The onset of inflation correlates more closely with global energy supply shocks than with changes in QE policy or “printing” money in Covid stimulus. Hmmm. [1] > USA, the UK, Aus etc and haven’t had for a number of years at this point Indeed, the US abolished the 10% reserve requirement in 2020. Crazy. I hope you guys also save in inflation hedges. [1] https://fred.stlouisfed.org/series/M2SL

[deleted]

Re: Setelinleikkaus: When Finns snipped their cash in half to curb inflation

#188

Post by mastazi »

Supermancho wrote: post #183
rf15 wrote: post #140

Earlier quoted context omitted.

You are wrong. Striking how many HN commentators are so often confident and yet wrong in their assumption that everything is about the US.

> You are wrong. Wrong about what? This is about the US Fed, in context of...well you can read the thread.

In context of a thread about Finland? Anyway, it is true that interbank lending is a primary method of controlling interest rates and this is not limited to the US. The commenter who mentioned it above, probably was talking about the Fed specifically maybe just because that's what they are familiar with.

Re: Setelinleikkaus: When Finns snipped their cash in half to curb inflation

#189

Post by lutusp »

poincaredisk wrote: post #138
lutusp wrote: post #131

> ... snipped their cash in half ... Actually, they snipped their cash in two , not in half . This is one of several afflictions that lurk in modern language, ignored by nearly all. Another is the use of phrases like "similar effect to ..." where "effect similar to ..." is the correct form. Notwithstanding how it grates on one's ear, this second egregious malaprop seems to be the preferred form. Oh, well. Since print…

This is a standard English idiom: https://dictionary.cambridge.org/thesaurus/cut-in-half . You may not like it, or think it's illogical, but that doesn't make it incorrect.

> This is a standard English idiom ...

Certainly true.

> ... but that doesn't make it incorrect.

Also true, and not a claim I made.

Re: Setelinleikkaus: When Finns snipped their cash in half to curb inflation

#190

Post by IAmGraydon »

TeaBrain wrote: post #124
IAmGraydon wrote: post #73

Earlier quoted context omitted.

Ahh…no. The Fed sets the interest rate directly. What you are talking about is yields on treasury bonds, which are manipulated via bond buying to force money into assets by artificially dropping the yield of those bonds, thus creating a more attractive investment in the stocks, assets, etc.

They were entirely wrong about mechanism of setting the interest rate through the discount and fed funds rate, but this description also isn't comprehensive. The feds buying of treasury bonds isn't just to push them down, but is also a mechanism for increasing the monetary supply through the expansion of the fed's balance sheet. This mechanism for increasing the monetary supply is also why the linked article doesn't…

I explained this in my other reply. They buy the bonds with printed money, thereby injecting that money into the economy.
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