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  • Yes, most dot.com and tech companies start with negative earnings. The QQQ marches upwards with stops and starts. Should you take the $15/hr job or the $50k/yr med school debt? You'll be running a deficit, growing greater each year. You 'run a deficit' for the promise of future growth. You are net negative. If there were a way to sell all of your future earnings however, you would be way positive.

    If you think this time is the time the 'game stops' then short the market.

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    • Stagnant supply chain combined with increased demand by consumers in the US is most likely the biggest factor re: inflation. Once that becomes resolved, it will come back down, at least to historical levels which is 3-4%.

      Printing money doesn't really have as much of an effect as people seem to think. It may make sense intuitively, like more dollars means each one is worth less, but that's not the primary factor driving up inflation rn.

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      • Originally posted by xraygoggles View Post
        Stagnant supply chain combined with increased demand by consumers in the US is most likely the biggest factor re: inflation. Once that becomes resolved, it will come back down, at least to historical levels which is 3-4%.

        Printing money doesn't really have as much of an effect as people seem to think. It may make sense intuitively, like more dollars means each one is worth less, but that's not the primary factor driving up inflation rn.
        then what is the primary factor? i presume you don't think that printing money contributes to supply chain factors and increased demand?

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        • Originally posted by jacoavlu View Post

          then what is the primary factor? i presume you don't think that printing money contributes to supply chain factors and increased demand?
          if the U.S. government "printing" money was the main cause of inflation, why is inflation a current problem globally, especially in europe?

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          • Originally posted by pitt1166 View Post

            if the U.S. government "printing" money was the main cause of inflation, why is inflation a current problem globally, especially in europe?
            europe has central banks too

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            • Originally posted by pitt1166 View Post

              if the U.S. government "printing" money was the main cause of inflation, why is inflation a current problem globally, especially in europe?
              I think globally the pandemic had the same effect. Low interest rates. Tons of money being pumped out and handed to people who did not work to either produce goods or provide service. People stayed at home, did not spend money on services. People started ordering goods and the production in China / SE Asia was drastically reduced due to COVID hitting the workers and shutting factories and reducing output. Too much money chasing too few goods will cause shortages and prices to rise.

              I think experts make this inflation tendency as some sort of numbojumbo but the basic principles remain unchanged. Raise the interest rates and reduce free money. Once the money in the hands of people becomes less, cost of borrowing increases and goods become relatively more plentiful with more supply than demand, the costs come down..

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              • Originally posted by pitt1166 View Post

                if the U.S. government "printing" money was the main cause of inflation, why is inflation a current problem globally, especially in europe?
                Is it really? 4.9% in a place that hasnt managed to hit 1% in decades with zero population growth.

                Japan has had low/negative rates for decades but nothing until right now.

                Inflation is a political and market failure/mismatch.

                And no one is printing money again, thats not how it works, money is endogenous. For every debt, that is someone elses income, it all balances. If the government has a deficit, the public has a surplus.

                What say all you small govt libertarian types, do you want the government to hoarde your money or would you rather have it?

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                • Originally posted by Kamban View Post

                  I think globally the pandemic had the same effect. Low interest rates. Tons of money being pumped out and handed to people who did not work to either produce goods or provide service. People stayed at home, did not spend money on services. People started ordering goods and the production in China / SE Asia was drastically reduced due to COVID hitting the workers and shutting factories and reducing output. Too much money chasing too few goods will cause shortages and prices to rise.

                  I think experts make this inflation tendency as some sort of numbojumbo but the basic principles remain unchanged. Raise the interest rates and reduce free money. Once the money in the hands of people becomes less, cost of borrowing increases and goods become relatively more plentiful with more supply than demand, the costs come down..
                  How does raising rates and making it harder to get money ease things like supply chains which require investment? It will make them more expensive and would be more likely to exacerbate inflation really.

                  Sure things arent wonderfully targeted but that can always be better.

                  Comment


                  • Originally posted by Zaphod View Post

                    How does raising rates and making it harder to get money ease things like supply chains which require investment? It will make them more expensive and would be more likely to exacerbate inflation really.

                    Sure things arent wonderfully targeted but that can always be better.
                    Raising rates won't ease the supply chain but the increased cost of borrowing and increased saving from better interest rates will make it less money chasing a short supply of goods and not spiking inflation. And when the supply chain crisis resolves ( as it will ) there will be more goods awaiting less money available to purchase it, and the prices will fall accordingly.

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                    • Originally posted by Zaphod View Post

                      And no one is printing money again, thats not how it works, money is endogenous. For every debt, that is someone elses income, it all balances
                      jerome powell that guy that is chair of the fed calls in printing money. digitally, obviously, but i don’t think that’s the point you’re trying to make. call it creation then if you prefer

                      then they buy treasuries. gov debt

                      whos income is that?

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                      • Originally posted by Kamban View Post

                        Raising rates won't ease the supply chain but the increased cost of borrowing and increased saving from better interest rates will make it less money chasing a short supply of goods and not spiking inflation. And when the supply chain crisis resolves ( as it will ) there will be more goods awaiting less money available to purchase it, and the prices will fall accordingly.
                        Wait, hasn’t the fed always raised rates to control inflation?

                        Kamban, isn’t this like saying 1+1 = 2?

                        Not being snarky here, but Zaphod you seem focused on defending them not doing anything and that confuses me.

                        The government did several things that seem to have contributed to inflation lately.

                        Do you disagree with that?

                        these are the things i think contributed:

                        1. Created a surplus in money supply
                        (focusing on the term printing is a distraction, we all know it is a digital creation of a surplus but it is essentially the same overall result as printing and irrelevant semantics)

                        2. lowered rates and kept them low. Encourages spending. Increases demand.

                        3. Paid people to stay home. (less people working to provide goods and services means more demand).

                        I know the problem is complex but to say that raising rates will make it worse, and to say it with certainty seems overconfident at best.

                        Have a good morning.
                        Last edited by Tangler; 12-02-2021, 03:49 AM.

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                        • “And no one is printing money again, thats not how it works, money is endogenous. For every debt, that is someone elses income, it all balances. If the government has a deficit, the public has a surplus.

                          What say all you small govt libertarian types, do you want the government to hoarde your money or would you rather have it”

                          Completely ignores economics. Money supply is not a zero sum game. Things like reserve requirements for banks, the money multiplier, price elasticity come into play in the real world.
                          Lower interest rates encourage more spending (growth) by a multiple.
                          Higher interest rates slow spending (contraction) by a multiple.
                          The reason economics is ART not science is because the multiplier is unknown and the time frame is unknown and the velocity is unknown.
                          The government has interfered with the free market as a second tool to keep credit available to prevent a depression.
                          The government is a zero sum game.
                          The requirement is growth of the private sector to pay the bills when they come due. One dollar:ten dollars multiplier is a powerful tool on the way up. On the way down, the government simply will require a gift from the private sector. That is called a tax. The government reserves the right to collect any amount from the private sector and distribute as it sees ft.
                          Increasing government debt works well in a slow growing private sector. However, the way down is devastating.
                          By definition it comes out of the private sector. Big time.

                          Comment


                          • Originally posted by Tim View Post
                            “And no one is printing money again, thats not how it works, money is endogenous. For every debt, that is someone elses income, it all balances. If the government has a deficit, the public has a surplus.

                            What say all you small govt libertarian types, do you want the government to hoarde your money or would you rather have it”

                            Completely ignores economics. Money supply is not a zero sum game. Things like reserve requirements for banks, the money multiplier, price elasticity come into play in the real world.
                            Lower interest rates encourage more spending (growth) by a multiple.
                            Higher interest rates slow spending (contraction) by a multiple.
                            The reason economics is ART not science is because the multiplier is unknown and the time frame is unknown and the velocity is unknown.
                            The government has interfered with the free market as a second tool to keep credit available to prevent a depression.
                            The government is a zero sum game.
                            The requirement is growth of the private sector to pay the bills when they come due. One dollar:ten dollars multiplier is a powerful tool on the way up. On the way down, the government simply will require a gift from the private sector. That is called a tax. The government reserves the right to collect any amount from the private sector and distribute as it sees ft.
                            Increasing government debt works well in a slow growing private sector. However, the way down is devastating.
                            By definition it comes out of the private sector. Big time.
                            how’s that saying go, about if you can’t explain it simply? “economics” as you refer to it is a scam, smoke and mirrors, fiat BS.

                            Comment


                            • Originally posted by jacoavlu View Post

                              how’s that saying go, about if you can’t explain it simply? “economics” as you refer to it is a scam, smoke and mirrors, fiat BS.
                              Like bitcoins? Loosen up. Taxpayers are the guarantors of government debt. Pretty simple.

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                              • Originally posted by Tim View Post

                                Like bitcoins? Loosen up. Taxpayers are the guarantors of government debt. Pretty simple.
                                but sir, my president says all this stimulus isn’t going to cost me anything?

                                and mr zaphod says it’s income?

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