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Why the Fed wants corporate America to have a hiring freeze

finance.yahoo.com

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Re: Why the Fed wants corporate America to have a hiring freeze

#21

Post by SantalBlush »

s1artibartfast wrote: post #8
anfilt wrote: post #6

You need workers to make goods and service, deliver them ect... If you freezing hiring thats just gonna cause shortages for domestic goods and services. Leading write back to higher prices...

The current thought is that current inflation is driven more by consumer demand than supply shortage. That is to say, consumers have a lot of cash and are buying more goods than are available.

Right. So increasing rates should begin to entice more people to save their money instead of spending it, thereby cooling demand. We just haven't yet reached that point with the current rate hikes, apparently.

Re: Why the Fed wants corporate America to have a hiring freeze

#22

Post by HWR_14 »

zozin wrote: post #19
mensetmanusman wrote: post #12

“ He’s talking to corporate America, and his goal is to have companies essentially institute a hiring freeze and end the cycle of paying up for new hires.” Ahaha. What.

They’re trying to avoid a wage-price spiral which would likely lead to stagflation.

Stagflation is defined by inflation and a lack of wage growth. A wage-price spiral is, by definition, not stagflation.

Re: Why the Fed wants corporate America to have a hiring freeze

#23

Post by systemvoltage »

nine_k wrote: post #20
systemvoltage wrote: post #17

Earlier quoted context omitted.

Inflation is necessary to a certain degree to decrease savings rate in the economy and promote capital flow.

So it's basically a tax which is really hard to evade, and which sort of "happens" instead of being voted for.

That's an interesting perspective. I'd say that it propels society forward in many ways. If you only think of capital is something that needs to be saved, then ideally you'd prefer to live in a deflationary society where capital is scarce, it's value is increasing (deflation) and the only winner is the one who saves it. In a well oiled society, capital is merely an instrument to multiply the labor value (think capital needed to buy automation machinery or paying AWS bills), and thus leading to GDP growth – here, inflation promotes liquidity. You'd rather invest than to save. Taxes are the opposite of optionality, since you can't really do anything about the coercion from the government besides pray to god that your tax contributions are being efficienty allocated.

Re: Why the Fed wants corporate America to have a hiring freeze

#24

Post by s1artibartfast »

nine_k wrote: post #20
systemvoltage wrote: post #17

Earlier quoted context omitted.

Inflation is necessary to a certain degree to decrease savings rate in the economy and promote capital flow.

So it's basically a tax which is really hard to evade, and which sort of "happens" instead of being voted for.

Inflation is mostly a regressive tax because it is pretty easy to evade if you have your value parked in non dollar assets. Housing or stocks for example should appreciate with the inflation rate, if all else is equal. Wages are usually more sticky, so consumers have less to spend.

Re: Why the Fed wants corporate America to have a hiring freeze

#25

Post by touisteur »

s1artibartfast wrote: post #9
touisteur wrote: post #3

I don't understand what's going on there. Could someone please ELI5? Why is the labour market so hot in the first place? Shouldn't we all be looking for better (as in actual market rate) compensation?

The labor market is hot because the proportion of of the population working is down 8% since 2000, and a significant portion of the population have more cash and are buying more than ever. This came to a head during the pandemic when the number of workers spiked down and money rained from the sky https://fred.stlouisfed.org/series/CIVPART

Thanks for the explanation. There's still something (well lots) strange to me.

What are these people doing? I read COVID assistance had dried up (?), and still people are not going back into the workforce?

Isn't wage inflation supposed to help there, putting people 'back to work'? I mean, a big chunk of these 8% will be low-paid service jobs I keep hearing no one can hire for anymore ; shouldn't increasing wages (and, well, stopping the 'service-workers are slaves we can treat as dirt' mentality) help a lot here?

Re: Why the Fed wants corporate America to have a hiring freeze

#26

Post by touisteur »

s1artibartfast wrote: post #16
mensetmanusman wrote: post #13

Earlier quoted context omitted.

This is what population stagnation looks like, wups there are no young people to fill some jobs…

Part of it is the boomers retiring, but the population pyramid is is fairly stable. [1] The bigger issue is fewer young people are working every year. [2] 16 to 19: -24% in the last 20 years 20 to 24: -11% in the last 20 years. 25 to 34: -3% in the last 20 years. Meanwhile, older people are working more than ever. This exaserbates issues of inequality. Essentially the young and poor are working less and the old and e…

And now I'm really curious about why the young and the poor work less. How can they participate less ? What's the mean of subsistance here ?

Re: Why the Fed wants corporate America to have a hiring freeze

#27

Post by ffggvv »

kalupa wrote: post #4

So, wealth is getting redistributed downwards because of inflation. Am I getting that right? Wouldn’t want that to happen.

poor people spend a higher percent of their income on gas, grocery, and rent. All the things being inflated. their wages aren’t keeping up either

so no you’re wrong. actually half the reason we’re in this mess is the fed was being too woke trying to lower unemployment rate for ”marginalized” groups not because they were favoring the rich

plus the fed raising rates is destroying asset prices, which are held by the rich. in fact elon and bezos etc have lost double digit percents of their net worth

Re: Why the Fed wants corporate America to have a hiring freeze

#28

Post by ffggvv »

touisteur wrote: post #25
s1artibartfast wrote: post #9

Earlier quoted context omitted.

The labor market is hot because the proportion of of the population working is down 8% since 2000, and a significant portion of the population have more cash and are buying more than ever. This came to a head during the pandemic when the number of workers spiked down and money rained from the sky https://fred.stlouisfed.org/series/CIVPART

Thanks for the explanation. There's still something (well lots) strange to me. What are these people doing? I read COVID assistance had dried up (?), and still people are not going back into the workforce? Isn't wage inflation supposed to help there, putting people 'back to work'? I mean, a big chunk of these 8% will be low-paid service jobs I keep hearing no one can hire for anymore ; shouldn't increasing wages (and…

some people retired a year or two early and didn’t plan on re entering the work force. especially since asset prices ballooned allowing them to do so.

i think driving down asset prices and raising wages and lowered unemployment benefits will hopefully reverse some of that

Re: Why the Fed wants corporate America to have a hiring freeze

#29

Post by s1artibartfast »

touisteur wrote: post #26
s1artibartfast wrote: post #16

Earlier quoted context omitted.

Part of it is the boomers retiring, but the population pyramid is is fairly stable. [1] The bigger issue is fewer young people are working every year. [2] 16 to 19: -24% in the last 20 years 20 to 24: -11% in the last 20 years. 25 to 34: -3% in the last 20 years. Meanwhile, older people are working more than ever. This exaserbates issues of inequality. Essentially the young and poor are working less and the old and e…

And now I'm really curious about why the young and the poor work less. How can they participate less ? What's the mean of subsistance here ?

For 19-24, I assume many of them are just not working and subsisting off of their parents incomes.

As for the rest, there are many ways individuals can get by. They can sustain themselves via their partner, get funds from friends and family, participate in underground workplaces, and last but not least, receive income from disability or other social services.

It is worth noting that numbers are falling about twice as fact for men as women. This could be related to the fact that two women now go to college for every one man.

Re: Why the Fed wants corporate America to have a hiring freeze

#30

Post by odessacubbage »

s1artibartfast wrote: post #29
touisteur wrote: post #26

Earlier quoted context omitted.

And now I'm really curious about why the young and the poor work less. How can they participate less ? What's the mean of subsistance here ?

For 19-24, I assume many of them are just not working and subsisting off of their parents incomes. As for the rest, there are many ways individuals can get by. They can sustain themselves via their partner, get funds from friends and family, participate in underground workplaces, and last but not least, receive income from disability or other social services. It is worth noting that numbers are falling about twice as…

anecdotally i see a lot of young people basically taking moonshots at crypto or gig work while living at home because the labor market no longer seems to provide them either stability or paths to independence.
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