421–430 of 619 posts
Yellen supposedly told Greenspan & co in the mid 90s that 2% was a good way for companies to be able to adjust labor costs down if needed (if you don't give someone a raise when inflation is 2%, you're effectively lowering their salary). It was the only way to have some flexibility there. If you admit that this is a desirable thing, this is defeated by wage negotiations (or say, benefits) than tend to be indexed to i…
Yellen supposedly told Greenspan & co in the mid 90s that 2% was a good way for companies to be able to adjust labor costs down if needed (if you don't give someone a raise when inflation is 2%, you're effectively lowering their salary). It was the only way to have some flexibility there. If you admit that this is a desirable thing, this is defeated by wage negotiations (or say, benefits) than tend to be indexed to i…
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>2% was a good way for companies to be able to adjust labor costs down if needed (if you don't give someone a raise when inflation is 2%, you're effectively lowering their salary) This is EXACTLY the issue. The economy is rigged such that in the absence of any positive action, workers' purchasing power goes down over time by default. This obviously isn't a problem for the rich, whose money is stored almost entirely i…
> The economy is rigged such that in the absence of any positive action, workers' purchasing power goes down over time by default. This obviously isn't a problem for the rich, whose money is stored almost entirely in assets which by definition rise in value with inflation. Look, I'm sensitive to the struggles of the less well off, and that we are in a particularly rough part of a cycle. I don't believe the economy is…
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Government likes to terrify people with stories of depression (and fascism and climate change) in order to grab more power for themselves and the elite. If you play the game then you too can get paid - get a PhD, keep your eyes down and march like they say, and they'll pay you to play with numbers that make them look credible. But people are waking up. The Internet has democratized information (sorry, it's popularize…
The tricky bit is interwebs make sarcasm really hard to detect, especially when today there's ample real and honest examples of extreme opinions along any given scale. I may be socially inept, but I'm still perplexed as to which of the couple of different points of view separated by "just kidding" phrase you are genuinely putting forward; apologies if I'm being obtuse, it is not deliberate.
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> Technology and innovation has made people’s lives better at the same time that politicians and bankers have made them worse. That's the SV fantasy!: I'm awesome and a super-genius, everyone else is useless, dumb and annoying, and therefore I should be all-powerful!. It's like they're all still 13 year olds hacking on their computers, where they finally feel really powerful. It's almost as if they've never learned a…
Technology is the only reason the economy could somewhat continue during the pandemic. Did you hear about working from home? Technology is how we got a vaccine so quickly. Technology is how we tracked the spread. Technology is how we notified of potential exposure. Nobody with a humanities background did anything meaningful to help compared to the last pandemic. It was all technology, engineering, medicine, and scien…
If you learned a bit about it, you wouldn't show off rigid tunnel vision or you might express yourself clearly and without the blind destruction of hyperbole.
Why did people make or not make vaccines? Humanities (and social science). How were they funded, regulated, etc.? Ditto. What is the scientific method? Humanities (really). Why did the US and EU as expected, but not, e.g., Russia make the most effective vaccines? Humanities. Why did people take or not take vaccines? Humanities, or not enough humanities, or they were owned by people who mastered messaging and mass political communication, which is humanities.
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It's not good for a society to save by holding on to worthless pieces of paper or shiny objects. It's good for society to save by investing in productive assets.
It's not good for society that ordinary people have to speculate their hard earned money just to keep it for retirement.
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The US national debt more than doubled between 2008 and 2018, but inflation was low. It's only up 50% in the 6 years since, but we've had crazy inflation. The only new factors have been the things you listed - supply shocks, war. A lot of things other things happened in 1914. For instance, World War 1. Why not blame that for inflation? I said inflation was due to all of the factors you listed. Debt and deficits was o…
> The only new factors have been the things you listed - supply shocks, war You overlooked the incredible increase in government spending. > I just don't think it's the only factor, like you do. For the other factors, you'll need to account for where all the extra money comes from.
Tax cuts too. Tax increases reduce inflation.
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> There's clearly market supply/demand driving changes in gold price Of course. And in all other commodity prices. But in a world where the money supply was stable, those price changes, over time, would average out to zero. Or, if you factor in increased productivity over time, they would average out to a steady (if probably slow) decrease in the prices of goods and services. What you would not see is an average incr…
There’s no natural state of money is there? I feel like characterizing monetary policy that way, as manipulative, is normative and kinda begs the question that there’s a natural state of monetary policy. How could there be growth in the economy with a fixed pie of money? It is contradictory. There’d be a tremendously high bar for investment in any enterprise which could generate dollars if I could buy more tomorrow w…
If you mean there is no specific quantity of money that is "natural", that's true. Any quantity of money can work. But that does not mean that changing the quantity of money as a routine, common operation is a good thing.
> How could there be growth in the economy with a fixed pie of money? It is contradictory.
No, it isn't. Economic growth means producing more goods and services. With a fixed quantity of money, that means either the velocity of money increases (money goes around in a circle faster in order to facilitate an increased number of transactions) or average prices decrease (so less money is required on average per transaction)--or more likely a combination of both. Both of those things are perfectly possible. (And even that leaves out increasing quality of goods and services, which results in more value created even if quantity stays the same, and with a fixed quantity of money means more value for the same money even if nothing else changes.)
> There’d be a tremendously high bar for investment in any enterprise which could generate dollars if I could buy more tomorrow with the dollars I already have today.
If the quantity of money is fixed, what does "enterprise which could generate dollars" mean? It can only mean a productive enterprise, which produces goods or services that people will pay money for. You want to encourage such enterprises, not discourage them.
Indeed, it is only in an environment where the quantity of money is not fixed--where people can scheme to be given the privilege of printing more--that people end up squandering resources on activities which produce no useful goods or services, but do result in more money going into their pockets. Which is the situation we have now, where the government prints money as a way of stealthily transferring wealth to financial institutions without those institutions having to produce useful goods or services.
> Think about how much bitcoin is being put to work in the productive economy versus hodled.
But that is because the quantity of Bitcoin is not fixed. People can mint more. So Bitcoin is irrelevant to analyzing the case where the quantity of money is fixed.
The more money the banks print, the richer they get, with the side-effect that prices rise (they make the monetary units less scarce and worth less). 2-3% just happens to be the most they can get away with in the long term without the population getting concerned. What the general population don't realise is that the value of goods and services are going down over time, due to efficiency increases, at a rate of aroun…
> They are roughly the same price in gold as they were in the 1970s So you're implying that there was no inflation between 2011 and 2022 (gold prices were basically the same) or that prices increasing 8 times or so between 2000 and 2011 because gold got a lot more expensive? Gold is just a random commodity affected by market supply/demand just like every other commodities (or bitcoin). Implying it's some sort of a "h…
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>>government would stop trying to micromanage the economy Right, but some of us are not religious, so proposals needs a little bit more than the blind faith of "take your hands off the wheel and I'm sure everything will magically be better for everybody, particularly the poor".
Deregulation has not lead to a utopia of competition in free markets, rather virtually every market is a cartel or monopoly with heavy regulatory capture. This is probably the best example of government lack of regulation, considering that their ample laws against monopoly's, cartels and duopolies from the days of Teddy Roosevelt's administration They are effectively not enforced, or if enforcement is attempted corpo…
You're contradicting yourself. You can't have "regulatory capture" and "deregulation" at the same time.
As a matter of actual fact, we do have lots of regulatory capture, which has resulted in huge swaths of regulation that favors large corporations who can afford lobbyists, and disfavors smaller business that actually are the most productive part of our economy. With what results, we see.
> They are effectively not enforced
Antitrust law enforcement has indeed been irregular since they were passed--but what enforcement has been done has done more harm than good. The classic cases of antitrust enforcement, such as Standard Oil or Alcoa Aluminum, resulted in higher prices and scarcer products for consumers--i.e., a negative impact, not a positive impact.
However, antitrust laws are a very small part of the total body of regulations that affect businesses. It's just that most of those regulations are written by executive branch bureaucrats instead of Congress. The Federal Register is much larger than the United States Code, and includes much more detailed micromanagement of all kinds of business activities. Which, again, favors the large corporations that bought those regulations in order to hamstring their competitors, smaller businesses who are more productive but less able to absorb the costs of compliance with that huge mass of regulations.