I had a friend who was an amateur economist, and he did some research on economic data from the 1970s and 1980s, and concluded that monetary policy was not too loose in the 1970s. He reached that conclusion partly because the velocity of money increased substantially in the 1970s, which indicated that there wasn't too much money sloshing around in the US economy and causing inflation. Instead, other factors were mainly causing inflation. (The velocity of money is appoximately the average total amount of checks written from US checking accounts in a certain length of time, divided by the average balance of checking accounts). I looked at his research and concluded that the main cause of inflation in the 1970s was lack of competition in the US economy and a large number of corporate and union oligopolies dominating the US economy at that time. An oligopoly is domination of a market by a group of corporations or labor unions. The Big 3 automakers was an oligopoly in America in the early 1970s, for example. Oligopolies lead to higher prices, higher profit margins, and lower economic output--in other words, they cause stagflation, and that's what we had in the second half of the 1970s.
The Reagan Administration, aggressive young American companies (such as Wal-Mart, Home Depot, and Target), and Japanese companies (such as Toyota and Honda), did a brilliant job of breaking up the oligopolies of the 1970s and bringing much more price competition and efficiency to the US economy. That's the main reason for the big drop in inflation in the 1980s, along with major corporate and individual tax cuts that provided incentives for cost-reduction investments, education, and greater efficiency in the US economy. Fed policy in the 80s was more of a psychological factor helping to bring down expectations for future inflation.
I think it's about time for Janet Yellen and one of her top economists to have a talk with Powell and explain to him that we're not in the 1970s today, and the Fed is starting to overdo interest rate increases, and the probability of a recession next year is growing. I would say the best move for the Fed right now is to raise rates by another 50 basis points at their next meeting and then pause and monitor economic data. The core PCE inflation last month was only 0.1%, so we're already getting a substantial drop in inflation, and a pause to monitor incoming data this Fall is a good idea.
Stop printing currency and stop spending it like drunken sailors!
Or, is that the intention to get exactly what they want? It seems too obvious for them to not understand and must be doing it on purpose and damn the consequences.
The spin: “some”. The reality: “excruciating”.
Please...We’ve been in pain for 18 mos.....since da shut everything down on Day one...he signed about 70 EOs
Can this guy count to 20 without taking off his shoes and socks ?
2% Inflation is not stopping Inflation.
2% compounds nastily over 40 years.
"Inflation is always and everywhere a monetary phenomenon" - Dr. Milton Friedman
He said that the Federal Reserve’s efforts to control inflation would cause “some pain to households and businesses.” Bankers are wanting increases in money from loans and a larger needy labor pool for some businesses.
There’s also growing discontent with the environment (too many unworthy bodies as perceived by many), which is fueled by increasing drug abuse and incoming hordes from the direction of the Equator—results of policies from many of the same influential political donors in efforts to bring more subservient labor. It’s a vicious cycle produced by those who seek to fix the mess that they made, and many of them are not long descended from countries outside of the USA.
The shitbag Biden disaster is worse than people think. These inflation numbers don’t include fuel and food.
This will be my 7th recession since I started noticing money and paying attention to it. Every one was needed and led to good opportunities, just like this one will. It’s just barely getting started, patience and longer-term thinking are the keys for now.
If you didn’t hit any doubles, triples or homers during the last boom, your next chance is coming.
One result will be an eventual greater difference in standards of living between private sector labor and government/professional factions. More political strife ahead.
The Recession is here and has been for probably 6 months, it now getting worse and inflation will get worse not better. Congress, instead of slowing spending, has increased it. The Fed us already way behind and real rates should be at least 8% right now. Only an aggressive policy will work and that is just not going to happen.
Powell is talking out of his @@S on this thing to Jawbone the situation. He better have the Balls to go the full court here. And if the Eurasian Block quits using the Dollar as a Reserve Currency then what will happen when all of those Billions o Trillions come back to the U.S.? Can you say Bond Default? Because that is what is coming.
Behind a wall, but I'm posting the link for the headline.
Anyone else think that's a threat...?
We're in a recession right now...
Unlike Volker, Powell won’t be able to raise rates sufficiently to bring down inflation because the $30 trillion in debt makes it untenable. There may be a temporary pause as we head into recession and Powell starts to unload the Fed’s balance sheet, but I see inflation continuing for years to come.
Mini wheelbarrow avoidance going higher.
R E T E N M A R K.
But they’re attempting mass taxation first.
And maybe another $5-10T in Nancybucks printed before New Years Day for special relief of ...things. Pesky inflation just won’t go away.
But we just spent $2T on the inflation reduction plan and $500B for student loan cancelation in just the past few weeks.
Wasn’t that suppose to alleviate any pain going forward?