The Economy Got Off to a Historically Bad Start in 2014

Post by grantbachman » Wed, Jun 25, 2014, 11:18 PM UTC

nostromo wrote: post #7

jacobolus wrote: post #3

Earlier quoted context omitted.

Just sending checks to all citizens is politically difficult, because it starts conversations about “class warfare” and “socialism”, and implies that the federal government should have a policy of explicit wealth redistribution, rather than the current hodge-podge of means tested welfare programs and monetary policy tools. But to answer your question: yes, we’d increase liquidity, reduce unemployment and dramatically…

Let's put aside the Federal Government (and taxes and spending) for a moment and focus on the Federal Reserve. The Federal Reserve printed a large amount of money in response to the crisis. (That was a silent tax on anyone holding cash.) To inject this money into the economy, they bought a bunch of securities. My question is simply: why use asset buying as a vehicle for injecting money into the economy and not cash t…

Post by mikeyouse » Wed, Jun 25, 2014, 11:23 PM UTC

shirkey wrote: post #14

valas wrote: post #9

Earlier quoted context omitted.

Feds are obsessed with keeping inflation at a certain level, not at zero. I think the target is 3%, while current inflation is around ~2%.

Government stated inflation based on chained CPI and other new measures to reduce inflation may be at around 2%, but previous formulas used in the past to calculate inflation would show a much higher rate (6-10%)[1]. For those actually buying or consuming anything, that official number is a farce. [1] http://www.shadowstats.com/alternate_data/inflation-charts

Post by 001sky » Wed, Jun 25, 2014, 11:28 PM UTC

dragonwriter wrote: post #12

nostromo wrote: post #7

Earlier quoted context omitted.

Let's put aside the Federal Government (and taxes and spending) for a moment and focus on the Federal Reserve. The Federal Reserve printed a large amount of money in response to the crisis. (That was a silent tax on anyone holding cash.) To inject this money into the economy, they bought a bunch of securities. My question is simply: why use asset buying as a vehicle for injecting money into the economy and not cash t…

> The Federal Reserve printed a large amount of money in response to the crisis. (That was a silent tax on anyone holding cash.) To inject this money into the economy, they bought a bunch of securities. My question is simply: why use asset buying as a vehicle for injecting money into the economy and not cash to citizens? Because that's all that the Federal Reserve can do. If you want someone to do something else, you…

Post by kaonashi » Wed, Jun 25, 2014, 11:37 PM UTC

nostromo wrote: post #2

I'm starting to wonder if the Federal Reserve is no longer an effective tool for job creation. After years of propping up the economy and expanding the supply of money, we have very little to show for it on "main street." We have booming real-estate prices in some cities, a growing stock market, and lots of cheap money flowing into the hands of the wealthy -- but most regular folks have been completely shut out of th…

Post by Paul_Dessert » Wed, Jun 25, 2014, 11:38 PM UTC