Posted on 10/12/2022 1:21:12 PM PDT by Tell It Right
A slowdown of economic growth and the US job market will be “required” to bring down inflation, the Federal Reserve said in notes released Wednesday, adding that prices remain “unacceptably high.”
Fed officials also said inflation has “not yet responded” to increased interest rates, according to minutes of the US central bank’s September meeting, and that “a significant reduction in inflation would likely lag that of aggregate demand.”
(Excerpt) Read more at breitbart.com ...
No one talks about increasing supply anymore. SMH
“US growth slowdown ‘required’ to beat inflation”
Pretty tough when there is no growth.
I think the market will be more or less flat. What's gonna get punished is small businesses, again. And people who work for small businesses and the service industry. People will lose jobs and they want higher unemployment because they need to ring out consumer buying.
That’s the plan.
Inflation is an excess of money. Only two ways to rein it in. Cut government spending, or reduce private sector lending. Since the Democrats won’t discipline themselves, killing off private lending (investment) is all they’ve got.
Buckle up.
Buckle up is right, we are going to get reamed.
Growth?
What growth?
I suspect that 0.40% for September will be adjusted down to
-0.30%.
You dont need to slow economic growth and ruin young people’s lives, the ones just starting out, with a violent soul crushing recession.
I told my young adult "kids" to not buy a house now. Wait for the Fed to deflate the housing market that they artificially inflated with low rates. Of course my kids said, "but, but, what about high interest rates?" I replied that it'd be better for them to be patient and buy a house at a low cast, even if with a high interest rate. This is because when the cycle continues and rates go back down later, they can refinance and have both a low mortgage debt and a low rate.
They can't do the opposite. If they buy a house now at a high cost/low interest rate, then later when housing costs go down they can't refinance to lower the balance. A high price for a house is forever locked into the mortgage (until it's paid off). But a high interest rate can later be financed to a low interest rate when the Fed lowers rates again like they'll eventually do.
The fix is to reopen a free market energy industry—oil, gas, coal—and things will stabilize. Biden destroyed the free markets with his East German style planned economy. He wants us all driving electric version of Trabants.
There is monetary policy, fiscal policy, and regulatory policy. Let’s consider examples of each as applied to the energy sector.
Increasing the money supply is an example of monetary policy. It pushes down interest rates and increases the availability of credit. Companies can more easily and affordably borrow to finance the creation of a pipeline, drill, on land or offshore, or build a new refinery.
An example of fiscal policy would be if the Government were to buy oil to fill the Strategic Petroleum Reserve.
Regulatory policies include shutting down a major pipeline, refusing to issue permits for drilling on land and offshore, and refusing to grant permission for the construction of a new refinery.
Student exercise: Which of these policies is the most powerful?
Student excercise: Rate Biden policies in each of the above areas.
The Fed uses such flowery language when they give folks the middle finger.
They should have just gone out and said it:
“Let them eat cake.”
;-)
Can’t recal a time when Demand destruction worked. Anyone?
Nor reducing deficit spending.
Bingo
What about stopping spending? What about stopping the debt cancellations and government give-aways? THat is what will stop inflation. Growth has nothing to do with it in a functioning market.
I think that changes this Saturday.
Insanity. The main problem is fuel prices.
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