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It’s mostly a demand shock, not a supply shock, and it’s everywhere

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Re: It’s mostly a demand shock, not a supply shock, and it’s everywhere

#391

Post by wexler88 »

throwtheacctawy wrote: post #358
wexler88 wrote: post #345

Earlier quoted context omitted.

Solar is an excellent replacement for home heating oil during the Michigan winters. The vast majority of people in Michigan are already connected to an extremely efficient distribution network for electricity. The marginal cost of delivering additional energy through this network does not round to zero, it is zero. Meanwhile heating oil is delivered by trucks with a large cost in depreciation, labor, and fuel (furthe…

I live in Michigan. I have a 5.9kwh solar array. Spring/fall, I can produce over 40kwh/day. Summer heat lowers my production to upper 30-40kwh. January 2021, I produced 197kwh the entire month. I know this discussion is focused on heating. But from an electric vehicle perspective; 197kwh is not that much. In the winter, I don't think it would be enough electricity for a homes electric needs + EV or electric heat. I c…

Did you miss the part where Michigan is already connected by a transcontinental electricity distribution grid to places like Las Vegas (8 average hours of sunlight in January, average temp 9C in January)?

Re: It’s mostly a demand shock, not a supply shock, and it’s everywhere

#392

Post by relaxing »

danjayh wrote: post #149
asdff wrote: post #97

Earlier quoted context omitted.

The government didn't even grant people a months worth of rent in my city. Not sure how that lead to such a huge infusion of demand that continues to persist, unless there are just that many people with very little rent who are driving this demand. Seems like such a small amount in the grand scheme of things considering most people even working a minimum wage job might see more money back on a tax return than the mea…

Not sure where you live, but a family of two adults and 3 kids got $13,900 in stimulus checks so far in the USA, not counting the expanded child tax credits (which would be another $5400 if the kids are young, dispersed in $900 monthly payments for the last 6 months of the year). Even a single adult with no kids would have gotten $3,200 so far. I mean, damn, how much is rent in your city? https://www.pgpf.org/blog/20…

I wonder why that think tank you linked doesn’t have a handy fact sheet on rent prices.

I don’t think any of the stimulus checks covered a month’s rent in any major city, and the checks weren’t coming monthly.

Re: It’s mostly a demand shock, not a supply shock, and it’s everywhere

#393

Post by imtringued »

ren_engineer wrote: post #385
PaulDavisThe1st wrote: post #177

Earlier quoted context omitted.

> Demand doesn't boost GDP, producing real goods and services boosts GDP. You can't spend your way to prosperity despite what any of the insane MMT economists might say. I appreciate that you feel strongly on this matter. However, the strength of your feelings are less relevant than the fact that different people (who all know quite a lot about this sort of thing) do not agree with you (or with each other). Calling M…

how would MMT work in a pre-industrial economy? Technological progress that boosts efficiency is what drives real growth, not economists printing money

Boring answer: MMT says boost production.

Re: It’s mostly a demand shock, not a supply shock, and it’s everywhere

#394

Post by imtringued »

fallingknife wrote: post #235
PaulDavisThe1st wrote: post #177

Earlier quoted context omitted.

> Demand doesn't boost GDP, producing real goods and services boosts GDP. You can't spend your way to prosperity despite what any of the insane MMT economists might say. I appreciate that you feel strongly on this matter. However, the strength of your feelings are less relevant than the fact that different people (who all know quite a lot about this sort of thing) do not agree with you (or with each other). Calling M…

MMT does sound like those radio commercials they had back in the 90s saying they would teach you how to "borrow your way out of debt" though.

MMT is just the credit theory of money plus the realization that the government runs its own bank.

I don't know what you are talking about.

Re: It’s mostly a demand shock, not a supply shock, and it’s everywhere

#395

Post by imtringued »

slv77 wrote: post #356
paganel wrote: post #242

Earlier quoted context omitted.

> not this Frankenstein economy that's been created since at least 2008 if not earlier For what it's worth the US has economically out-competed the European Union in that time-frame, with the US basically following Keynes and the UE going the austerity route most of the time (and only at times, begrudgingly, also following Keynes as a result of the Americans doing it first). There's also China that has out-competed t…

Both the US and China have paid the costs as that liquidity has flooded into speculative assets such as land which has increased wealth inequality. In addition it likely has resulted in misallocation of capital and a future tidal wave of bad debt. While households are typically cash constrained economies operating in a fiat system rarely are because cash is essentially created at will by the banking industry. Economi…

That's just the nature of imbalanced trade. The US reserve currency mandates permanent trade imbalances. It's a double edged sword.

Re: It’s mostly a demand shock, not a supply shock, and it’s everywhere

#396

Post by ovone »

P00RL3N0 wrote: post #4

I'm honestly surprised inflation hasn't been worse than what we've already seen. 10-year treasury yields are still well below their 2019 levels and are currently below their levels from Q2 of this year.

Totally agree. We have been living a long period of low inflation with a huge QE at the same time...

Re: It’s mostly a demand shock, not a supply shock, and it’s everywhere

#397

Post by datavirtue »

throwaway894345 wrote: post #200
rsj_hn wrote: post #153

Earlier quoted context omitted.

> Natural gas extremely expensive? Let me introduce you to renewables, which btw are getting better and better every year. Shutting down a natural gas pipeline that people depend upon just before winter, and then lecturing them about solar panels is not a good look. Artificially increasing the price of natural gas causes famines, it causes food and fertilizer to be more expensive, and it makes it hard for people to h…

I sympathize with this, but if climate experts are to believed, we’ve stalled to the point where we have perhaps a decade to get emissions under control in order to meet targets, and most countries haven’t even begun to make significant changes. At some point there will be pain. The question is, “do we want a little pain now or a lot of pain down the road?”. And to be clear, “wearing a coat inside during winter” may…

I have was a denier of: CO2 emitted by humans causes global warming until I studied chemistry. Then it hit me. The earth is warming, we are making it warm faster. This place is normally hot...we are making it worse.

The claims sound fantastic if you don't have a solid education. The people you are trying to convince do not have an education that will allow them to understand for themselves. They fundamentally distrust the people trying to convince them. There is no "to be believed." That has already reached the saturation point.

Re: It’s mostly a demand shock, not a supply shock, and it’s everywhere

#398

Post by imtringued »

asdff wrote: post #194
EEMac wrote: post #167

Earlier quoted context omitted.

The 1920s have something to say about markets that climb without reference to underlying production.

If anything the great depression supported this thesis of stocks always going up, and you can safely forget sweating the actual underlying economics. If you held through the crash or bought at the bottom you'd obviously be doing fine. Look at this chart (1). Seem familiar? Looks a lot like the great recession or March 2020 to me: a big plunge that took headlines followed by an unstoppable bull trend, in this case one…

You're misinterpreting the situation completely. China is running a trade surplus vs USA which means China has lots of dollars. Because of foreign exchange policy it will not use the dollars on imports. The only thing the money can be spent on is financial assets. All the Fed does is lower interest rates in response to this "savings glut" and that is the right thing because oversupply should result in lower prices for anything including money.

Because of the reserve currency status almost every country on earth is running a surplus vs the US and buying their financial assets.

Re: It’s mostly a demand shock, not a supply shock, and it’s everywhere

#399

Post by mindslight »

edmundsauto wrote: post #170
arthur5005 wrote: post #68

What this doesn’t really address is the why? Yeah there’s more money floating around, so perhaps more people want to spend it, but why? Most people aren’t getting materially more stuff or even need that much more stuff, consumption’s already god damn conspicuous. Maybe everyone can afford a jet ski all of a sudden? No, the stims didn’t really do /that/ kind of wealth expansion. To me, this still looks like the bullwh…

Looking for “why” is often a path to becoming more fragile and/or frustrated. I do a lot of split tests (a/b testing). People always want to know why a treatment worked. I believe this is human nature. However, the answer to any specific situation is generally unknowable. I may have only changed one color and gotten way different results, but there could be a billion or a trillion situation dependent factors that cau…

What you're finding with A/B testing is local maximums. Which might make sense when your sole goal is squeezing a few more pennies out of a mundane business. But generalizing this to all of existence is sorely mistaken.

Asking "why" is the act of cognition. Discerning structure, compression, building a model (science). Then applying that model to new territory (ie engineering), to achieve better gains than undirected walk. Eschewing this is basically nihilism, and it's far too common these days.

Re: It’s mostly a demand shock, not a supply shock, and it’s everywhere

#400

Post by djrogers »

mmarq wrote: post #378
throaway46546 wrote: post #299

Earlier quoted context omitted.

>Some lockdown policies directly affect your 'need for stuff' I think this was the root cause of the toilet paper shortage. People who normally spend a large portion of the day at the office were now spending that time at home. There was a popular viral video at the time of a man driving around on a forklift in a warehouse full of toilet paper laughing about the shortage, but it was all commercial toilet paper not wh…

The causes of the lockdown shortages are cultural, toilet paper disappeared in Northern European and English speaking countries, while in Italy (and I think in some places in Spain) yeast could not be found.

Yeast and flour were gone in the US as well (at least where I live).
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