Agreed:
Posted on 04/12/2014 9:22:34 AM PDT by Kaslin
One striking example is the RIDICULOUS retired state employee pensions.
You have people sitting at home @ 58 years old raking in $20, $25, $30, $35 or more dollars an hour to walk out to the mailbox twice a month for the next 20-30 years.
THAT'S why the call for a $10 an hour minimum wage is out there.
Deflation is here, but it can't force down those public sector wages & pensions.
Oceania has always been at war with Eastasia.
Larry makes a pretty good argument here.
I'm glad Larry picked the least manipulated markets as price signals. /S
The fiscal policy being pursued by the FED is an attempt to walk a tightrope between inflation and deflation, turning what would be a brutal depression into about 12 years of Euro-style stagnation.
Which would be preferable is a matter of debate.
The result is a perfect storm, assets are in deflation while many consumables are inflatiing. This leads to much confusion for the public. the problem will last until about 2022, though things should start improving by 2017 or so.
Enjoy.
It is simply a way to transfer wealth from savers to borrowers who get to pay back their debt with devalued dollars.
Inflationist logic is that high inflation and more money printing means ppl have more money in their pockets to spend
Agreed:
Nice summary from Kudlow.
IMHO, the USA is counting on inflation to pay down its foreign debt. This would not work, except that the U.S. dollar is the world’s reserve currency. U.S. debt is denominated in U.S. dollars. Use inflation to make the dollar a lot less valuable; then pay the debts with the cheaper dollars. That way, you stick it to your creditors.
Of course, as a foreigner, I fully support this strategy — because, the world owes Americans a living. (You might detect a tinge of sarcasm here.)
I agree that our political/regulator class Americans feel that the world owes them a living through recirculating foreign debt. The U.S. trade deficit with Canada in 2013 was $31,731,000,000.
So we should lower the U.S. dollar for more of a free international market, manufacture our fair share of products and sell them to Canadians. In return, we’ll buy more Canadian lumber, oil (traded in loonies), metals and unique products made from those vast natural resources. It would make Canadians in the West happy, but they’re not bound so much to desks in eastern services.
In return, we’ll stop the “chemtrails” and admit that Canadians are different from us. ;-)
--sure if you're into making a religion out of monetary policy. The thing is that while religious orthodoxy is appropriate and necessary for addressing ultimate issues ("we shall oppose needless human suffering"), it doesn't work in developing effective monetary policy ("I'd like to see King Dollar appreciate by 10 to 15 percent... ...Amen"). In fact, it's flat out crazy.
I mean, just what in the ever-loving hell does Kudlow think he's talking about with his Almighty King Dollar worship? He wants what, purchasing power meaning 10-15% deflation? If he means foreign exchange rates then which currencies are we supposed to devalue?
Perhaps maybe he's coming down with WPS (warped pundit syndrome) that's been going around, like we've been seeing in Krugman and PC Roberts.
Yellen was picked because she is biased in favor of inflation. That’s her job. Ours is to make our politicians feel the heat for every uptick in inflation. Then, they must make Yellen so miserable that she begs them to take away the dual mandate of low inflation and low unemployment and just leave her to low/no inflation.
Great comment. One of the absolutely unreported stories of this down cycle is government’s inability to adjust costs down. It is the cost of government that is killing jobs and the middle-class.
If government could adjust its spending and payroll quickly downward, a la the 1920-21 depression, we’d be on the path to 5% real growth yoy.
Look at how they punished the prudent already.
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