How f*ing stupid is this. It includes tax increases on the rich and businesses...the usual bogeyman for the Democrats. Ok, so if business taxes go up, they will try to pass that onto consumers. However, since price goes up, demand goes down and that’s supposed to lower prices? What it does is raises prices consumers face, resulting in less being bought, which also means less demand for labor and other inputs.
Increase taxes on the rich sounds so good, until you realize it is the rich who create new businesses and expand existing ones using their capital for real investment in plant and equipment. So, let’s kick them in the teeth because most people vilify the rich and love the poor. Never mind that they can’t create growing employment opportunities. Why do we glorify the poor? How many of you were hired by a poor person?
The Fed isn’t helping, either. The Equation of Exchange says MV = PQ, where M is the money supply, V is the velocity of money (i.e., the rate it turns over in the system—pretty much unchanged for decades), P is the price index, and Q is real output of goods and services. Because V is virtually constant and we want P to be constant (no inflation), if real output grows by X percent, then the money supply needs to increase by a similar percent. It takes a steady hand on M to keep things balanced. Now, go look at the data on M2 (the near-money measure of M) and you’ll see the Fed looks like it has palsy.
Finally, study a President who has no clue on any of this or, indeed, even where he is. All this bodes badly for the US.
“The Fed isn’t helping, either.”
Are you talking about the money supply or interest hikes?
IMO The central bankers have to hike rates to a decent %, if they don’t our economy will just jam more capital into real estate & equities.
Just be glad the bankers are being humane because if they really wanted to get rid of the speculative rot, they’d crank up interest rates and gut the money supply.
If that happens people won’t be bitching about inflation, they’ll be looking for handouts and hoping they can find work.(Plus some will find religion during ‘hard times’)
Problem is you have corporations making the most they have in years. And yet they still raise prices. Why?????