European Central Bank leader doubles down on rate increases

The Associated Press ^ | November 4, 2022 | By DAVID McHUGH

[Oldeconomybuyer]

FRANKFURT, Germany (AP) — The head of the European Central Bank underlined the bank’s determination to fight rampant inflation with more interest rate increases on top of record hikes, saying Friday that “our job is far from being completed” and that even a mild recession would not be enough to bring rising prices back under control.

ECB President Christine Lagarde said in a lecture at the central bank of Estonia that “we will not let high inflation become entrenched” by allowing expectations of higher prices to become baked into wages and costs, creating a spiral of ever-higher inflation.

She said central bankers must be “prepared to take the necessary decisions, however difficult, to bring inflation back down — because the consequences of letting too-high inflation become entrenched would be much worse for everyone.”

Lagarde indicated that the rapid pace of increases in the bank’s benchmarks at the July 21, Sept. 8 and Oct. 27 meetings was not the end of the effort to snuff out inflation that has hit a record 10.7% in the 19 countries that use the euro currency, where the ECB decides monetary policy.

[Oldeconomybuyer]

The Great Reset

[MeganC]

20% interest rates are going to be necessary to eat up all the fiat funny-money that’s been created all over the world.

What I would like to see is the Old School solution of a Jubilee Year where all debts public and private are erased and absolved.

All of it is wiped out.

The bankers will hate it but if you round up a few thousand of them and execute them they’ll figure it out.

People will need to figure out how to save and stay within their means again because hundreds of banks that are overextended will perish. There will be far fewer banks to borrow from and the culture of credit will necessarily come to an end.

We can choose to do this!

Or we can just wait for the whole house of cards to collapse.

Either way it is going to happen. Better it be a controlled crash than an uncontrolled crash.

[Gen.Blather]

Wow. Where to start. Our entire civilization today only exists because of credit and fiat money. If everyone had to pay for everything in cash then there would be a lot less stuff, which means a lot fewer jobs where people earn money and a lot less infrastructure, ships, planes, trains, cars and all the things those entail. The banks are providing a vital service and without them, nothing we have today would exist. We’d be subsistence farming like it was the nineteenth century.

Underpinning every aspect of modern life is...credit. Now, periodically, politics does bad things with credit. This is one reason we have elections, to kick out people doing bad things. Killing of bankers would be disastrous.

In the 1930’s if the government hadn’t tried to punish bankers and had instead used some “quantitative easing” the Depression would probably have been over a lot sooner. keeping government small would also have gone a long way to ending the Depression sooner.

[Michael44.]

While your enthusiasm for this may prove to be contagious, bear in mind that BANKERS are debtors to just about all who carry their own weight in this world; we are in agreement on the for higher interest rates... to head off the modern form of jubilee... hyperinflation. It should also be remembered decent work is the only thing that gives value to money, so things that stand in the way of decent work can still cause inflation regardless of interest rates, ie Turkey with 70%+ inflation and high interest rates.