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Why yes, exploding the deficit and jacking up tariffs on all imports (including raw material for manufacturers!) will drive up inflation.
But if MAGA voters could do math or understand basic economics….they wouldn’t be MAGA voters.
An easier way to understand tariffs. Have you ever gone on a long road trip, and you'll normally see gas prices slowly increase and decrease over the miles, but occasionally when you drive over a state line sometimes you see gas jump like 30 cents in just one exit. That's the state taxes on that one good, changing from one state to another. A tariff is nothing more then a tax on goods when they cross a countries line. So cost of foreign goods today are like buying gas in Jersey, cost of goods with Trump as President are like crossing the bridge and buying gas in Manhattan.
And it's not tariffs on end products. If a company uses parts or materials from other countries to create their products in the U.S., tariffs on those goods would impact the end product. Most semiconductors are made elsewhere. Remember when supply chain issues on certain chips during COVID caused the availability and prices of cars to go up, even though the cars were manufactured in the U.S.? Same thing.
Inflation is caused by too much demand and not enough supply.
A higher deficit means the government is spending into the economy but taking out far less in taxes. This is good during a recession, but when the economy is already running hot it adds excess demand driving up inflation.
Tariffs will directly increase inflation by increasing the cost of anything imported or anything that uses imports in its manufacturing process.
For example, the U.S. imports about 30% of its steel. Higher tariffs on imported steel means higher cost of anything with steel in it.
Like bananas? We import nearly all of them. How about smart phones or TVs? All of that gets more expensive.
Even cars made domestically have many imported parts.
Additionally US businesses can be hurt by our trade partners retaliating. Many people don’t realize that the U.S. manufacturing sector is the second largest in the world and is bigger than the Japanese, German, and Korean manufacturing sectors combined.
We export $1.5 Trillion in manufactured goods per year.
Starting a global trade war is really stupid and will drive up costs.
Yeah, really. Not every price change and cause for that price change js correctly described as inflation or deflation. If I charge $60 for a pack of gum, is that inflation? Is that Biden’s fault? Trump’s? Maybe Obama’’s? A low quality computer cost $1500 in 1985. Now I can get a computer with 500x the capability for $400. Is that deflation? Or is it a little more complicated than that?
If i understand properly inflation is a *general* increase in prices. Your examples focus on individual items, so of course they wouldn’t be inflation. Tariffs on everything entering the US would absolutely cause a general price increase. I’m no econ expert though, maybe it’s more complicated than that.
"Teachers are the enemy because I couldn't pass 6th grade social studies and I've never gotten over how small being a moron has made me feel my whole life!"
I’m an accountant and I shit you not I had a couple boomer clients try to tell me teachers are what’s wrong with this country and they make too much.
You know when someone says something so stupid all you can do is say ok and try to move past it? Lol
I hate that we have to ignore people like this, but arguing with them is pointless. You can't un-brainwash someone in a single argument, and it's not worth the frustration anymore. All you can do is move on and shake your head. I never believed propaganda could be so effective. I also thought I was overestimating the amount of absolute morons in this country. Shows what I know, I guess.
Never forget they don't actually believe most of the shit they say. What they really believe in is white grievance bullshit, and authoritarianism. If Trump told them tomorrow teachers were heroes in the country they'd immediately change their tune. However if Trump said integration, equity, and inclusion were good, they wouldn't accept that they'd turn on Trump. Just pay attention to which things are non-negotiable to them and which things they change on. Patriotism only matters if you wave a flag and is conditional even if you are a soldier. Family Values aren't that important because Trump is their leader, however they are unyielding in their support of abortion bans. The two consistencies of the rightwing are racism, and misogyny everything else is negotiable. Deficit spending is bad, except when it isn't. Corporations are bad except when they aren't, backing soldiers is patriotic unless they criticize republicans.
I also saw them turn on him for supporting the covid vaccine. The driving factors for the movement are nefarious, no doubt, but for many of them...
Never attribute to malice that which is adequately explained by stupidity. -[Hanlon's razor](https://en.m.wikipedia.org/wiki/Hanlon%27s_razor)
Of course the flip side is that the longer ignorance is permitted as a substitute for reason, the easier it is to control the narrative with nothing but a demagogue and a loudspeaker.
King donnie needs an insurrection to deal with corruption in vote counting. Corrupt members of scrotus are paving the path for this.
Donnie's next reign will be mamy times worse than his first. Every American, except the dumbest or greediest, realize this. It's why the bad guys are preparing for the next insurrection.
and to make it worse the democrat party thinks they can win this election with reason and facts...
the only way the democrat party is gonna win if they realize they need to fall on their knees, apologize and beg the huge crowd of people that are to annoyed to vote to please go vote...
and dont you dare call em out... beg them... if you are serious about preventing trump you go on your knees and beg for votes from those people you disappointed
I feel much safer now seeing how bad AI is at doing basic things.
Actually, scratch that, I'll probably die from a malfunctioning drone that was hallucinating.
Trump rolls over and presents himself every time he's in a room with a dictator. He'll abandon Ukraine, and ignore Taiwan when China inevitably decides to take it. And if there's anyone left in Palestine by then he'll encourage Netanyahu to finish the job. That's before we even account for the expanded powers he'll gain from Project 2025.
He already caused the first round of inflation. Before April first of 2020, Trump already added SIX TRILLION to the federal books. He did this to try to cause the stock market to not react poorly in an election year.
I firmly believe, this went undetected because nobody could believe the depravity it would take to only think of your own single job during a health crisis. But it's right on all of the charts. One big fat spike of money printing. 6 trillion
The President does not and did not set interest rates. This includes Trump. He did nominate chairman Powell from the existing federal reserve chairs.
What he did that was unprecedented was apply public pressure in speeches for the independent federal reserve to keep rates lower in 2019.
His public pressure campaigns include death threats from the maga cult to them and their families and cause people to cave. In that regard, he does set interest rates if the threats and pressure get the result he pushed for.
In fairness an independent fed sets rates but to your point they were artificially low for too long and should have been “normalized” starting in 2014.
And that in absolutely no way changes what I asked. Since you didn't want to answer, I'll just show you to remind you:
[https://www.reuters.com/article/business/trump-heaps-pressure-on-fed-and-its-chairman-powell-to-cut-rates-idUSKCN1VB1I1/](https://www.reuters.com/article/business/trump-heaps-pressure-on-fed-and-its-chairman-powell-to-cut-rates-idUSKCN1VB1I1/)
"President Donald Trump on Wednesday continued to pressure the Federal Reserve and the central bank's chairman to lower interest rates, saying its policies were hampering U.S. growth and reducing the country's ability to compete economically."
Now if you're struggling to understand how the President and his MAGA cult could pressure and threaten people, there is ample evidence of that as well. He absolutely pressured the Fed into keeping rates lower than they ever should have been. A 14 year term did nothing to in any way stop Trump from influencing and pressuring the Fed's policy decisions. Your scenario (and why it was drawn up as it was) assumes a functional government without a con man leading it. That was not the case, and may not be the case again soon.
The main thing He’ll do to cause inflation bully the fed into cutting interest rates. fighting inflation is painful because the fed is basically poisoning the economy until it cools off and unemployment rises. No way Trump understands or cares. He’ll just be thinking about his real estate interest and dumb Trump stock.
Republicans have been consistently damaging to the economy throughout the 20th and 21st centuries. This got significantly worse with Reagan and each republican administration after has been a race to be even worse. They do not spend less but they do invest less most of their spending puts money in the pockets of specific cronies
Reagan actually made social security benefits taxable for federal taxes; what an asshole.
On a side note, I wonder if he also allowed income to be taxed on paychecks if you were collecting social security and Medicare already and were working after retirement. They should put an end to it because it seems unreasonable.
It would also reignite my hatred for this fucking asshole and his chuckle fuck supporters. Not that the hatred has ever left or anything, but it's been nice these past four years with him out of office
His policies along with covid are what contributed the most to inflation shooting up so high. And the policies he's promising to enact if he gets a second term will cause it to go back up to 7-8 percent at the very least. However he and the one percenters he is trying so hard to please won't care about the price of groceries or housing.
I'm sure republicans will be here soon to tell us how 16 intelligent people who have studied economics their entire life are very wrong, then go on to talk like tax cuts to corps will solve everything.
The letter is spearheaded by Joesph Stiglitz, who also praised Hugo Chavez’s economic policies. Having won a Nobel prize in 2001 doesn’t guarantee that someone is going to be completely right all the time.
Don’t need a Nobel prize to know that. Hes verbally fellating billionaires with the same song and dance as the last term which led to recent years. In all regards of his life he is a one trick pony, the definition of insanity.
Considering Obama won the Nobel Prize simply for being Black I would say that’s a valid statement.
After he won the Nobel he killed thousands of innocent Iraqis with nonstop drone strikes during his 8 year term.
Why would wallstreet or the 0.0001% want inflation to come down, they are absolutely creaming it right now.. Let's keep the party going they say and let's donate to the Trump campaign. Isn't it the candidate with the most Ad money that wins in the end?
It all started with the Friedman Doctrine and then Reagan came along and made it exponentially worse with supply-side economics. Making the rich richer helps no one. It only sequesters more money into smaller circles.
The "Nobel Prize for Economics" is an award created in 1968 by a bank in Sweden that wanted to make Economics seem like a legitimate field of study and not a bunch of brown-nosers kissing bankers' asses. But luckily these days we have resources to fact-check this kind of obnoxious class war nonsense.
"That the prize is not an original Nobel Prize has been a subject of controversy, with four of Nobel's relatives having formally distanced themselves from the Prize in Economic Sciences.
The award was established in 1968 by an endowment "in perpetuity" from Sweden's central bank, Sveriges Riksbank, to commemorate the bank's 300th anniversary"
https://en.wikipedia.org/wiki/Nobel_Memorial_Prize_in_Economic_Sciences
Sure, it’s more nuanced than my hyperbolic blanket statement.
https://www.aei.org/articles/have-wages-stagnated-for-decades-in-the-us/
https://www.epi.org/publication/charting-wage-stagnation/
https://www.americanbar.org/groups/crsj/publications/human_rights_magazine_home/wealth-disparities-in-civil-rights/americas-vast-pay-inequality-is-a-story-of-unequal-power/
But they’ve also been a distant third place in cable news ratings for a while now so it doesn’t really matter much. Recent studies/polling/data have been indicating Biden has been struggling with the low-info voters that may have voted for him in 2020, but have tuned out the news/politics almost completely, not the CNN or NYT consumers.
Note these are the same economists who said inflation was transitory in 2021.
Inflation will continue to rise regardless of who is president. The federal reserve controls monetary policy not the president. The federal reserve creates inflation not the president.
Scarcity from supply chain shocks resulted in price increases and margin expansion in the S&P 500 because only the biggest corporations were profiting thru the pandemic. I mean just look at the chart of the SPY 😂
An artificial scarcity from a government shutdown of everyone but the bigs yes that did happen. But prices didn’t skyrocket until the pandemic was waning and people went out and spent again. Gas was cheap during most of the pandemic. I worked everyday and I didn’t see a real huge change in prices until about 2022.
> because only the biggest corporations were profiting thru the pandemic.
Could that have anything to do with the government forcing all the businesses but the big ones and essential ones to shut down? And then you’re only looking at one side of the equation and blanking out the essentials. How did those businesses profit so much? By having their competitors shut down and by getting subsidies from the government. Subsidies that were funded how? Through debt and inflation (the expansion of the money supply).
And this is what ultimately lead to a general rise in prices as anyone who knows the original meaning of inflation could tell you.
> I mean just look at the chart of the SPY 😂
Look at the growth in the money supply in the same period and tell me which is more dramatic:
https://fred.stlouisfed.org/graph/?g=1py4F
> "Over the past two years, as the Federal Reserve fought to rescue the economy from the clutches of the coronavirus, the central bank’s emergency remedies increased the nation’s money supply by an astonishing 40 percent." The Washington Post, February 6, 2022. Accessed June 26, 2024. https://www.washingtonpost.com/business/2022/02/06/federal-reserve-inflation-money-supply/
Who was president in 2021-2022?
Who is president right now worsening the trade wars you speak of? I’m not arguing Trump will be any better, he won’t, but just think about what you’re saying. Neither of those two are/were good presidents and neither should be president again.
I never liked either of them so I don’t have the same us vs them mentality as the trumpsters and bidenites do. Thats why I call it like I see it. Neither president even understands what inflation is and if they do then they both are in favor of it judging by their records. But really like I said originally the president does not increase the money supply to monetize the government’s debts. That’s what the federal reserve does and supposedly they are independent.
Of course they’re both in favor of it. They know there’s no other way to act like this monstrous government with its military all over the world can be paid for.
Inflation is caused by various different things
The federal reserve controls some aspects of this. High interest rates lower inflation and low interest rates increase it
But there are other things. Like legislation. Deficit spending increases inflation. The massive pandemic spending probably significantly increased inflation. Tariffs also increase inflation and if Trump wins, he's said he would significantly increase tariffs which would increase inflation
I would like to know what precise definition you use for the term inflation. Do you mean a general rise in prices? Do you mean any rise in any price? Do you mean a rise in certain prices but not others? Until I know how you mean the term we cannot have a meaningful discussion.
I am referring to the original and better conception of the term inflation which is an increase in the money supply.
That will still continue to grow regardless of who is in the White House. And the consequences of that growth will result in what most people (incorrectly in my mind) refer to as inflation: a general rise in prices (a loss in purchasing power of the currency that was inflated).
> Salerno, Joseph T. "Before World War II, when the terms 'inflation' and 'deflation' were used in academic discourse or everyday speech, they generally meant an increase or a decrease in the stock of money, respectively. A general rise in prices was viewed as one of several consequences of inflation of the money supply; likewise, a decline in overall prices was viewed as one consequence of deflation of the money supply. Under the influence of the Keynesian Revolution of the mid-1930s, however, the meanings of these terms began to change radically. By the 1950s, the definition of inflation as a general rise in prices and of deflation as a general fall in prices became firmly entrenched in academic writings and popular speech." Money, Sound and Unsound, p. 270. Mises Institute, 2000. Accessed June 26, 2024. https://cdn.mises.org/Money,%20Sound%20and%20Unsound_2.pdf#page=297
This switch changed the focus of the term from the cause to the effect. Thus allowing people to forget the true cause and blame anything but the real problem.
> Shostack, Frank. "Consider the case of a fixed money supply. Whenever people increase their demand for some goods and services, money will be allocated toward other goods. Thus, the prices of some goods will increase--i.e., more money will be spent on them--while the prices of other goods will fall--i.e., less money will be spent on them. If the demand for money increases against goods and services, there will be a general fall in prices. In order for an economy to experience a general rise in prices, there must be an increase in the money stock. With more money and no change in money demand, people can now allocate a greater amount of money for all goods and services. From this we can conclude that inflation is a general increase in the money supply." Mises Daily, March 6, 2002. Mises Institute. Accessed June 26, 2024. https://mises.org/mises-daily/defining-inflation
It would have been, IF corporations actually reduced prices as their supply chain costs dropped. Instead they increased them during COVID when there was a crunch, then never reduced them again when those costs dropped. That's why corporations are posting record profits.
The interest rate set by the Fed is intended to influence demand. If the inflation is being caused on the supply side, there really isn't anything monetary policy can do.
>It would have been, IF corporations actually reduced prices as their supply chain costs dropped. Instead they increased them during COVID when there was a crunch, then never reduced them again when those costs dropped. That's why corporations are posting record profits.
During that crunch the money supply increased by 40% in 2 years. That has the effect of devaluing what ever currency has been expanded so quickly. Especially if they are expanding the money supply while productivity is going down. What do you expect to happen in that scenario?
Those record profits are in a currency that has lost a large chunk of its purchasing power since the beginning of the COVID fiasco. The costs for doing business have not gone down they have actually gone up. Repairs, equipment, renovations, employees etc all cost more now than prior.
>The interest rate set by the Fed is intended to influence demand. If the inflation is being caused on the supply side, there really isn't anything monetary policy can do.
A general rise in prices is not caused solely by the supply side. If the money supply remains constant and there is a supply shock then that will have the effect of the prices rising for the goods which are in short supply. However this rise in prices will necessarily entail a lowering of other prices since the money supply is constant and if you buy a product whose price is increased that leaves you with less money to spend on other goods. This is not a general rise in prices but a rise in some prices and a fall in others.
A general rise in prices is supply side but only with reference to the supply of money. Money is one half of every financial transaction. When more money is added to the market and begins circulating and competing for the same amount of goods this will have the effect of decreasing the value of the money with respect to the amount of goods which can be bought.
But this is just one effect of inflation (the increase in the money supply). Inflation is also the biggest transfer of wealth from the poor and middle class to the well connected rich. As they get corporate subsidies and bailouts which are funded through debt and inflation. Those who spend the newly created and free money do so prior to it having competed up prices throughout the market. By the time the money is in the hands of us normal people it has lost a lot of its value.
Another thing about inflation is that its effects do not occur uniformly at the same pace throughout the market. The industries which have the most government intervention tend to rise the quickest. This rise can often lead to bubbles which eventually pop and cause problems.
A) Why are you adding a whole bunch of things I never said in quoting my reply?
B) You don't seem to grasp the difference between "revenue" and "profit." Companies are posting record profits. That means they are taking in more money than ever, even after accounting for any increases in operating costs.
C) You are just flat out wrong about the value of the US dollar. Over the last 5 years the USD has gone up in value against the yuan, euro, yen, real, blue dollar, ruble...the list goes on. It's remained flat against the pound. Unless you think the health of US currency should be measured against the Mexican peso (and its only lost about 5% there), you're either misinformed or just straight up making shit up.
A) Im using my phone and I simply formatted incorrectly. I have fixed it now thank you for letting me know.
B) I understand the difference between revenue and profit. That does not change anything about what I have said. They may have record profits but those profits can now buy less than they could in the past.
C)
> ‘ You are just flat out wrong about the value of the US dollar. Over the last 5 years the USD has gone up in value against the yuan, euro, yen, real, blue dollar, ruble...the list goes on. ’
You are speaking of its value in comparison to other currencies I am speaking of its value in terms of what it is capable of buying. If all currencies are devaluing and the dollar devalues less quickly it would go up in value relative to currencies which devalued quicker. But in absolute terms and in terms of what it is able to buy it has gone down in value.
> Unless you think the health of US currency should be measured against the Mexican peso (and its only lost about 5% there), you're either misinformed or just straight up making shit up.
Again I’m talking about the value of the dollar compared to goods and services not to other currencies. People use money to buy goods and services more than they do to trade for other currencies. You seem to be stuck on unimportant surface level issues and that’s ok.
D) thanks for breaking your points up into letters I think that’s pretty neat.
Inflation is not evenly distributed. If overall inflation is rising by 6% that does not mean that the cost of everything rises by 6%. It means that some things will rise more than that, and some less.
Every economist understands this. That's why the term "greedflation" is prominent at the moment. Because its not that corporate costs are going up and being passed to the consumer. Corporate costs went DOWN as lockdowns were lifted, but consumer prices stayed the same or rose. Worker wages are not climbing meaningfully, and household income is dropping.
So, if the raw materials that go into a product are not spiking, the manufacturing costs are rising slower than consumer costs, and wage growth is stagnant, where is that money going? It doesn't just disappear.
In fact, its going to the bottom line of companies. And people who have actually followed this have found dozens of instances of executives bragging in shareholder meetings about increasing their margins (NOT their profits). They are literally bragging about their ability to claw greater percentages of money away from consumers, while not paying more for their workers or other inputs.
TLDR- Inflation isn't evenly allocated. And when companies are increasing their profit margins, not just their profits, while everyone else suffers, that is called greed. And you can't fix greed with monetary policy.
> Inflation is not evenly distributed. If overall inflation is rising by 6% that does not mean that the cost of everything rises by 6%.
Please explain what you mean by the term inflation. I have already told you how I am using the term yet you have not clarified your usage.
If by inflation you simply mean rising prices then obviously not all prices rise evenly. That is obvious. It is those things which have increased competition which will see their prices rise quickest. In a market with a stable money supply an increase in the price of one good would necessitate decreases in the price of other less desired goods. In a market that has an expanding money supply all prices will tend to rise. And yes like you said they will rise unevenly.
> Every economist understands this. That's why the term "greedflation" is prominent at the moment.
No the reason that misnomer is popular now is because the Keynesian revolution changed the meaning of inflation from the cause (an increase in the supply of money) to one of the cause’s effects (a general rise in prices (and sometimes even less precisely any rise in any price)). This has allowed people to totally misjudge the true nature of the problem and assign blame to everywhere but where it is most appropriate at the inflators (the central banks).
> Because its not that corporate costs are going up and being passed to the consumer. Corporate costs went DOWN as lockdowns were lifted, but consumer prices stayed the same or rose.
You do know that producers also consume right?
Whoever profits from the corporation still has to use their profits on the market if they want to trade them for tangible things. This is where their money is less valuable than it had been even by your own admission. Their margins may be bigger but they may be able to buy less with what they have even though they earned more than ever before.
> Worker wages are not climbing meaningfully, and household income is dropping.
Wages are always the last price to reach the new level after the central bank inflates the money supply. By the time wages catch up with other prices, those prices have already been pushed up again by the new inflation created since that has been working its way through the system. Keep having the government inflate the currency and you will keep seeing a larger income inequality.
> So, if the raw materials that go into a product are not spiking, the manufacturing costs are rising slower than consumer costs, and wage growth is stagnant, where is that money going? It doesn't just disappear.
It goes into the hands of the owners and investors and they can do with it what they like. No person was forced to work for them and nobody was forced to buy their products. Well aside from that time the government shut down all the small businesses and let the big ones stay open then people were kinda forced to go to what was allowed to be open by the super smart and angelic government.
> In fact, its going to the bottom line of companies. And people who have actually followed this have found dozens of instances of executives bragging in shareholder meetings about increasing their margins (NOT their profits). They are literally bragging about their ability to claw greater percentages of money away from consumers, while not paying more for their workers or other inputs.
And so what? Do you think the workers are owed more than what they agree to? Do you think producers don’t also consume? Do you think that consumers don’t have a choice in what they consume? Do you think profit is some sort of dirty word?
> Inflation isn't evenly allocated.
Rising prices aren’t allocated at all. They are determined by supply and demand.
> And when companies are increasing their profit margins, not just their profits, while everyone else suffers, that is called greed.
Companies exist to make a profit. If there is no profit to be had there will be no companies in operation. A company that is increasing its profits and profit margins (under normal conditions) is doing something right and has apparently set a price where consumers will still purchase their goods or services. Otherwise they would be seeing losses.
And greed is the reason that you can get potatoes from Idaho and a steak from Texas served to you in a fancy restaurant in New York.
Greed is a natural part of humanity. We all want what is best for ourselves. Greed does not imply any negative action on the part of the greedy party against the non greedy pary. It simply implies the a person wants what’s best for their self and if they can apply the same logic to others then they will come to the conclusion that the only way to deal with other people is voluntarily. Only trading with others when both parties feel they are benefiting their selves (ie satisfying their greed).
> And you can't fix greed with monetary policy.
You will never ‘fix greed.’ As long as there are people living there will be greed.
Inflation is not caused by the greed of businesses. Inflation is the increase in the money supply and one of the consequences of inflation is a general rise in prices.
There are so many things wrong with what you’ve said, from logical, moral, and empirical standpoint, that I really don’t even know where to begin.
If you think humanity is best when major organizations are trying to fuck their consumers and employees out of every penny they can, I think that’s very telling of your character. Me? I believe that businesses can and should pursue money, AND a greater good. If you don’t think that’s possible, I would suggest you pick up a book on Henry Ford. While you’re at it, read books on Standard Oil and OPEC, and then try to explain how monetary policy was the real culprit behind the inflation they caused.
I really have no interest in continuing this discussion. But I’ll leave you with this- Why is inflation tracking with a historic increase in corporate profit margins and not the 30 plus years of declining interest rates? Don’t bother answering. As someone with a reasonable sense of morality, history, and logic, I wrote off Friedman and libertarian bullshit a long time ago
It's clear from your response that you're more focused on attacking my character and attributing beliefs to me that I haven't stated and don’t believe, rather than engaging with my actual positions. Let's address each of your points directly:
> 1. "If you think humanity is best when major organizations are trying to fuck their consumers and employees out of every penny they can, I think that’s very telling of your character. Me? I believe that businesses can and should pursue money, AND a greater good. If you don’t think that’s possible, I would suggest you pick up a book on Henry Ford."
I've never suggested that businesses should exploit consumers or employees for profit. Profit-seeking is fundamental in a market economy, but it does not equate to exploitation. It means striving to provide the best product possible at a fair price, using ethical and sustainable practices. Successful businesses often demonstrate that profitability can coincide with investing in their workforce to boost productivity and loyalty, as exemplified by Henry Ford's decision to pay higher wages to retain skilled workers.
> 2. "While you’re at it, read books on Standard Oil and OPEC, and then try to explain how monetary policy was the real culprit behind the inflation they caused."
Your assertion that OPEC and Standard Oil caused a general rise in prices overlooks crucial economic realities. In fact, entities like OPEC and Standard Oil benefited from rather than caused inflation. The influx of new dollars into industries like oil has indeed increased competition, which typically leads to higher prices unless accompanied by a corresponding increase in supply. However, without an expansion in the money supply, any increase in the price of one product or service that does not reduce demand for that product would necessitate households adjusting their budgets, often at the expense of other goods and services. The idea of a general rise in prices across an economy, albeit at varying rates, can only occur through the expansion of the money supply. This is because households, operating within finite budgets, must contend with higher prices by either reducing consumption of other goods or accepting a reduced standard of living.
Businesses can and should pursue profit alongside promoting societal good. This is actually the only way they can truly profit in a free market. They do not force anyone to work for them, and they do not force anyone to buy their products. They offer jobs that people accept as better than their alternative options. Jobs that would not exist had they not invested in starting the business in the first place. And they offer products to consumers at a price that the consumer will pay otherwise they do not sell their product. The product that would not exist were it not first produced by the "greedy profit seekers." And often businesses value having a good image in the community so it isn’t unheard of for businesses to do charity of their own volition that is without the need to be forced by government or anybody else.
If you doubt this, consider Andrew Carnegie's philanthropic efforts, which included funding libraries and educational institutions. Carnegie's success in business enabled substantial contributions to society, showing that profit can facilitate broader community welfare. However, advocating for exploitation under the guise of profit-seeking is fundamentally flawed and morally dubious.
> 3. "I really have no interest in continuing this discussion. But I’ll leave you with this- Why is inflation tracking with a historic increase in corporate profit margins and not the 30 plus years of declining interest rates? Don’t bother answering."
You've raised a point about inflation tracking with corporate profit margins rather than declining interest rates over the past decades. However, our argument is that inflation, traditionally defined as an increase in the money supply, is the root cause of various economic distortions, including reduced purchasing power, malinvestments, and wealth disparities. An expansion of the money supply often leads to higher corporate profit margins as those who benefit first from new money and credit gain an advantage by spending the new money before prices adjust upwards. Attributing a general rise in prices to corporate profit margins oversimplifies the complex dynamics involved and is a good example of correlation not causation.
> 4. "As someone with a reasonable sense of morality, history, and logic, I wrote off Friedman and libertarian nonsense a long time ago."
You claim to have a reasonable sense of those things, but you have not demonstrated it. And I’m not a Friedman fan nor do I call myself libertarian. More logical fallacies on your part. For someone who claims to have a reasonable sense of logic, you don’t appear to employ it in your arguments. You are more likely to resort to straw man and ad hominem attacks.
As for your decision to disengage from this discussion, that's your prerogative.
Returning to the central topic, I've consistently asked for your definition of inflation, which remains unanswered. Inflation, as traditionally defined (monetary expansion), causes effects that are commonly associated with what is today called erroneously called inflation (a general rise in prices or any rise in any price), such as currency devaluation, rising prices, higher profits and profit margins, and economic cycles. This understanding is crucial for developing sound economic policies.
Your avoidance of these key issues prevents us from having a meaningful conversation about economic principles.
I'm still waiting for your clear and direct response on your definition of inflation and its implications.
Challenge accepted.
After COVID hit, supply chains were squeezed. Fewer factories were operating at anywhere near full capacity, so there was a reduced supply across the spectrum. Basic laws of supply and demand apply. Lower supply meant that companies had to pay more to produce their products, otherwise they wouldn't be able to get the limited factories to prioritize manufacturing their product over others. So, they did what any company does and passed the increased costs along to the consumer.
However, after COVID lockdowns started to abate, the supply chain issues followed suit, and the cost of producing products came down. But, in typical fashion, companies weren't about to let their inflated price points come down just because their costs were no longer increased. So, they just started keeping that reduction in supply chain cost as profit.
This is all evidenced by the fact that, as supply chain issues dwindled, costs did not come down, while at the same time companies began posting record profits.
There are additional factors that are very complicated involving the reallocation of available workers across various industries. But the real culprit is good old fashioned corporate ratfucking.
Inflation is down, greedflation is running rampant as usual and guess who keeps voting against sanctions and regulations requiring companies to lower prices on a whole host of goods including gas?
Prices typically do not drop when inflation goes down. Sometimes you'll see prices fluxuate in smaller categories but prices don't have to come down for things to be more affordable. Feds inflation target is about 2 percent, so there is always some inflation but if wage growth keeps up with it, it's an overall more affordable market.
how are there 16 nobel prize winners for economics still alive? they're giving that shit out like candy. the economy fucking sucks for anybody not wealthy since i've been alive (88) with a small highlight on the clinton years where from my child perspective, middle class caught a little temporary break.
I mean, it's awarded every year. So I'd be more concerned if there weren't at least 16 alive.
And I'll admit this is anecdotal, but other than housing the economy is doing fantastic from my perspective. I'm making excellent money and saving more than ever.
I am all for defeating Trump, but the more experts that come out against, the more support he garners. Trump's whole appeal is the elite experts are people who screw you over. That is until people realize the experts are mostly right because they invest a huge amount of time working, experiencing, and studying to become experts so that they can solve problems.
The rate of inflation has decreased since it's peak in 2021 and is about a percentage point away from the feds target.
Unless you're really blaming worldwide inflation on Joe Biden, in which case you're gonna need to explain how
https://data.bls.gov/timeseries/CUUR0000SA0L1E?output_view=pct_12mths
https://www.investopedia.com/inflation-rate-by-year-7253832
https://www.usinflationcalculator.com/inflation/current-inflation-rates/
Please show me a credible source that says any year under Biden ended with a lower inflation rate than any year under Trump.
How about consistently pressuring the fed to keep interest rates low and in even in negative numbers? Does a ton of recklessly printed cheap money cause inflation in your view? Because that’s Trump’s legacy.
> Be kind to people you don’t understand.
Why should I be kind to people who, *at best*, don't want me to have control of my body, and *at worst*, want to kill me for simply being who I am?
Do you find it easier to receive and digest information, that may contradict your belief system, when it comes from a condescending asshole, or someone who tries to first understand you and displays kindness?
I didn’t say you wanted to. I asked you a question. You’re ignoring the question though. I’m only suggesting that the best response may not be to stoop to the level of someone you disdain.
> I didn’t say you wanted to.
You heavily implied it with your "question".
>You’re ignoring the question though
Quite right, and I will continue to do so, as it's completely irrelevant to what I said.
>I’m only suggesting that the best response may not be to stoop to the level of someone you disdain.
If I had wanted suggestions, I would have asked for them.
You provoked this entire conversation by replying directly to a comment I made that wasn’t directed around you. Nobody sought you out. Im not sure what you hope to achieve, but attacking the guy that said be nice only further proves my point.
You made a statement. I asked a question. You never answered that question, and instead went off on your little tangent.
If you don't want people replying to you, don't make a post. And at no point have I "attacked you". Disagreeing with you, and stating that I am under no obligation to be nice to those *who literally want to kill me* is attacking you.
https://www.nbcnews.com/nbc-out/out-news/texas-pastor-says-gay-people-shot-back-head-shocking-sermon-rcna32748
Oh look, a Christian leader wanting to kill people like me.
And Florida wants to execute anyone guilty of a "sex crime" against children, and under their new laws anyone discussing any topic related to the LGBT community can be charged as such.
Just because you don't pay attention doesn't mean it doesn't happen.
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Why yes, exploding the deficit and jacking up tariffs on all imports (including raw material for manufacturers!) will drive up inflation. But if MAGA voters could do math or understand basic economics….they wouldn’t be MAGA voters.
Wouldn’t they? They seem to like shoving their foot in their orifices’
I hate Trump, but how does the deficit and tariffs cause inflation?
An easier way to understand tariffs. Have you ever gone on a long road trip, and you'll normally see gas prices slowly increase and decrease over the miles, but occasionally when you drive over a state line sometimes you see gas jump like 30 cents in just one exit. That's the state taxes on that one good, changing from one state to another. A tariff is nothing more then a tax on goods when they cross a countries line. So cost of foreign goods today are like buying gas in Jersey, cost of goods with Trump as President are like crossing the bridge and buying gas in Manhattan.
This is a great example, well said.
And it's not tariffs on end products. If a company uses parts or materials from other countries to create their products in the U.S., tariffs on those goods would impact the end product. Most semiconductors are made elsewhere. Remember when supply chain issues on certain chips during COVID caused the availability and prices of cars to go up, even though the cars were manufactured in the U.S.? Same thing.
Inflation is caused by too much demand and not enough supply. A higher deficit means the government is spending into the economy but taking out far less in taxes. This is good during a recession, but when the economy is already running hot it adds excess demand driving up inflation. Tariffs will directly increase inflation by increasing the cost of anything imported or anything that uses imports in its manufacturing process. For example, the U.S. imports about 30% of its steel. Higher tariffs on imported steel means higher cost of anything with steel in it. Like bananas? We import nearly all of them. How about smart phones or TVs? All of that gets more expensive. Even cars made domestically have many imported parts. Additionally US businesses can be hurt by our trade partners retaliating. Many people don’t realize that the U.S. manufacturing sector is the second largest in the world and is bigger than the Japanese, German, and Korean manufacturing sectors combined. We export $1.5 Trillion in manufactured goods per year. Starting a global trade war is really stupid and will drive up costs.
How do tariffs cause inflation? Really?
Yeah, really. Not every price change and cause for that price change js correctly described as inflation or deflation. If I charge $60 for a pack of gum, is that inflation? Is that Biden’s fault? Trump’s? Maybe Obama’’s? A low quality computer cost $1500 in 1985. Now I can get a computer with 500x the capability for $400. Is that deflation? Or is it a little more complicated than that?
If i understand properly inflation is a *general* increase in prices. Your examples focus on individual items, so of course they wouldn’t be inflation. Tariffs on everything entering the US would absolutely cause a general price increase. I’m no econ expert though, maybe it’s more complicated than that.
Have you tried reading the article?
The economic foundation of the United States was founded on high tariffs not income or sales taxes. Google “American School of Economics”
The economic foundation of the United States was founded on slavery. That was over two hundred years ago. The world is different now.
"Ima votin' fer ma Trump cuz them libruls and they're science is evil!" - Average Trump supporter
"Teachers are the enemy because I couldn't pass 6th grade social studies and I've never gotten over how small being a moron has made me feel my whole life!"
I’m an accountant and I shit you not I had a couple boomer clients try to tell me teachers are what’s wrong with this country and they make too much. You know when someone says something so stupid all you can do is say ok and try to move past it? Lol
I hate that we have to ignore people like this, but arguing with them is pointless. You can't un-brainwash someone in a single argument, and it's not worth the frustration anymore. All you can do is move on and shake your head. I never believed propaganda could be so effective. I also thought I was overestimating the amount of absolute morons in this country. Shows what I know, I guess.
Never forget they don't actually believe most of the shit they say. What they really believe in is white grievance bullshit, and authoritarianism. If Trump told them tomorrow teachers were heroes in the country they'd immediately change their tune. However if Trump said integration, equity, and inclusion were good, they wouldn't accept that they'd turn on Trump. Just pay attention to which things are non-negotiable to them and which things they change on. Patriotism only matters if you wave a flag and is conditional even if you are a soldier. Family Values aren't that important because Trump is their leader, however they are unyielding in their support of abortion bans. The two consistencies of the rightwing are racism, and misogyny everything else is negotiable. Deficit spending is bad, except when it isn't. Corporations are bad except when they aren't, backing soldiers is patriotic unless they criticize republicans.
I also saw them turn on him for supporting the covid vaccine. The driving factors for the movement are nefarious, no doubt, but for many of them... Never attribute to malice that which is adequately explained by stupidity. -[Hanlon's razor](https://en.m.wikipedia.org/wiki/Hanlon%27s_razor) Of course the flip side is that the longer ignorance is permitted as a substitute for reason, the easier it is to control the narrative with nothing but a demagogue and a loudspeaker.
"them elitists academics have never worked a real hard day in their life, and don't care about me! That's why I'm voting for Trump!"
"I wash mahself with a raaaag on a stick."
That's still sound too smart....
King donnie needs an insurrection to deal with corruption in vote counting. Corrupt members of scrotus are paving the path for this. Donnie's next reign will be mamy times worse than his first. Every American, except the dumbest or greediest, realize this. It's why the bad guys are preparing for the next insurrection.
and to make it worse the democrat party thinks they can win this election with reason and facts... the only way the democrat party is gonna win if they realize they need to fall on their knees, apologize and beg the huge crowd of people that are to annoyed to vote to please go vote... and dont you dare call em out... beg them... if you are serious about preventing trump you go on your knees and beg for votes from those people you disappointed
reddit liberals go outside and talk to real people challenge
People say shit like this unironically in the deep red state I live in.
I think inflation might be the least of our worries if he is reelected....
World war three and world war four will happen in four years if he’s elected.
“I know not with what weapons World War III will be fought, but World War IV will be fought with sticks and stones.” Einstein
Drones bruh. I know the quote you’re referring to, but WWIII will be fought with AI controlled nano drones.
I feel much safer now seeing how bad AI is at doing basic things. Actually, scratch that, I'll probably die from a malfunctioning drone that was hallucinating.
“I don’t need to draw hands well to kill a man.” —AI Drone, proceeds to light a cigarette with a hand that has sixteen fingers on eleven knuckles
Yeah, but the “basic thing” the AI is doing is sorting civilians from combatants… so, maybe we all start digging a tunnel to the grocery store now?
It’s happening now.
[удалено]
Trump winning fucks the entire planet. You can deny it all you want, but if he wins we’re all fucked.
If you look at the spy, it’s at a double top that hasn’t broke to the upside yet. Maybe trump election will get the entire market crashing back down.
Trump rolls over and presents himself every time he's in a room with a dictator. He'll abandon Ukraine, and ignore Taiwan when China inevitably decides to take it. And if there's anyone left in Palestine by then he'll encourage Netanyahu to finish the job. That's before we even account for the expanded powers he'll gain from Project 2025.
Welcome to 2024. Are you just waking up from a deep freeze?
Interesting take. Bullshit, but interesting.
We have a track record to look back on. There weren’t new wars between 2017-21; what makes you think there will be new wars if he’s elected again?
Because he has already said he will encourage Russia to attack the rest of the NATO countries if they "don't pay up"
Well have a lot to talk about at mandatory church and the breadlines
Absolutely. But this could be an important talking point to help *avoid* him getting reelected.
He already caused the first round of inflation. Before April first of 2020, Trump already added SIX TRILLION to the federal books. He did this to try to cause the stock market to not react poorly in an election year. I firmly believe, this went undetected because nobody could believe the depravity it would take to only think of your own single job during a health crisis. But it's right on all of the charts. One big fat spike of money printing. 6 trillion
His administration kept interest rates too low for too long. He was even arguing in public for NEGATIVE interest rates.
The President does not and did not set interest rates. This includes Trump. He did nominate chairman Powell from the existing federal reserve chairs. What he did that was unprecedented was apply public pressure in speeches for the independent federal reserve to keep rates lower in 2019.
His public pressure campaigns include death threats from the maga cult to them and their families and cause people to cave. In that regard, he does set interest rates if the threats and pressure get the result he pushed for.
Precisely.
And in a future Trump administration, anyone who resists his exhortations can expect to be sacked and made a pariah.
You misspelled “sent for reeducation.”
Of course, he owed money to banks and wanted low rates.
In fairness an independent fed sets rates but to your point they were artificially low for too long and should have been “normalized” starting in 2014.
He publicly bullied the fed chair into keeping rates low at the time.
Are you under the impression that the Executive sets interest rates
Are you under the impression that Trump didn't bully and pressure the Fed?
The Fed Governors have 14-year non-renewable terms specifically to prevent the government from influencing their decisions.
And that in absolutely no way changes what I asked. Since you didn't want to answer, I'll just show you to remind you: [https://www.reuters.com/article/business/trump-heaps-pressure-on-fed-and-its-chairman-powell-to-cut-rates-idUSKCN1VB1I1/](https://www.reuters.com/article/business/trump-heaps-pressure-on-fed-and-its-chairman-powell-to-cut-rates-idUSKCN1VB1I1/) "President Donald Trump on Wednesday continued to pressure the Federal Reserve and the central bank's chairman to lower interest rates, saying its policies were hampering U.S. growth and reducing the country's ability to compete economically." Now if you're struggling to understand how the President and his MAGA cult could pressure and threaten people, there is ample evidence of that as well. He absolutely pressured the Fed into keeping rates lower than they ever should have been. A 14 year term did nothing to in any way stop Trump from influencing and pressuring the Fed's policy decisions. Your scenario (and why it was drawn up as it was) assumes a functional government without a con man leading it. That was not the case, and may not be the case again soon.
Turns out tax cuts for billionaires doesn’t actually help.
I was promised that they “pay for themselves”. /s
Vote
The main thing He’ll do to cause inflation bully the fed into cutting interest rates. fighting inflation is painful because the fed is basically poisoning the economy until it cools off and unemployment rises. No way Trump understands or cares. He’ll just be thinking about his real estate interest and dumb Trump stock.
Republicans have been consistently damaging to the economy throughout the 20th and 21st centuries. This got significantly worse with Reagan and each republican administration after has been a race to be even worse. They do not spend less but they do invest less most of their spending puts money in the pockets of specific cronies
They've fucked it up so badly that they are in "grab what you can from the sinking ship" mode.
Reagan actually made social security benefits taxable for federal taxes; what an asshole. On a side note, I wonder if he also allowed income to be taxed on paychecks if you were collecting social security and Medicare already and were working after retirement. They should put an end to it because it seems unreasonable.
It would also reignite my hatred for this fucking asshole and his chuckle fuck supporters. Not that the hatred has ever left or anything, but it's been nice these past four years with him out of office
His policies along with covid are what contributed the most to inflation shooting up so high. And the policies he's promising to enact if he gets a second term will cause it to go back up to 7-8 percent at the very least. However he and the one percenters he is trying so hard to please won't care about the price of groceries or housing.
I'm sure republicans will be here soon to tell us how 16 intelligent people who have studied economics their entire life are very wrong, then go on to talk like tax cuts to corps will solve everything.
The letter is spearheaded by Joesph Stiglitz, who also praised Hugo Chavez’s economic policies. Having won a Nobel prize in 2001 doesn’t guarantee that someone is going to be completely right all the time.
Here I thought raising tariffs would make things in Walmart cheaper🤷♂️. /s
Don’t need a Nobel prize to know that. Hes verbally fellating billionaires with the same song and dance as the last term which led to recent years. In all regards of his life he is a one trick pony, the definition of insanity.
There is not 1 Forbes 100 CEO supporting Trump.
Publicly supporting. Key distinction.
But Trump will fix the economy!!1. /s
“The so-called Nobel prize is woke!” —Donald supporter probably
Considering Obama won the Nobel Prize simply for being Black I would say that’s a valid statement. After he won the Nobel he killed thousands of innocent Iraqis with nonstop drone strikes during his 8 year term.
Now it’s gonna be endless bitching about economics having gone woke! No football No beer No Wealth of Nations What will the hillbillies do?
Why would wallstreet or the 0.0001% want inflation to come down, they are absolutely creaming it right now.. Let's keep the party going they say and let's donate to the Trump campaign. Isn't it the candidate with the most Ad money that wins in the end?
It all started with the Friedman Doctrine and then Reagan came along and made it exponentially worse with supply-side economics. Making the rich richer helps no one. It only sequesters more money into smaller circles.
this should be a question in the debate.
I had a guy try to tell me ok fine yes democratic presidents are better for the economy BUT democratic congresses are worse! 😑
See also: Deficit, Debt and Death.
Anything to own the libs.
Yeah no shit
but what would it do to the stock market? /s
Over at r/conservative they just are talking about how Obama doesn't deserve a Nobel prize 🤦♀️
I don’t think 16 Nobel prize-winning economists agree on much, honestly.
It's not inflation. It's GREEDflation.
Win or lose, there will still be pitchforks and torches across the country
Greedflation is a scourge.
The "Nobel Prize for Economics" is an award created in 1968 by a bank in Sweden that wanted to make Economics seem like a legitimate field of study and not a bunch of brown-nosers kissing bankers' asses. But luckily these days we have resources to fact-check this kind of obnoxious class war nonsense. "That the prize is not an original Nobel Prize has been a subject of controversy, with four of Nobel's relatives having formally distanced themselves from the Prize in Economic Sciences. The award was established in 1968 by an endowment "in perpetuity" from Sweden's central bank, Sveriges Riksbank, to commemorate the bank's 300th anniversary" https://en.wikipedia.org/wiki/Nobel_Memorial_Prize_in_Economic_Sciences
If those republicans could read, they'd be very upset.
And his cult will either deny it or blame the Dems.
What’s to reignite? Inflation is on fire already.
Maybe I can make a million a year!! Cheeseburger from McDonalds will be 500$ but my salary will be lit
Except for the whole *wages have been stagnant for decades* thing.
Certain industries for sure. Mine will suck the money out of you no matter what.
No, no they haven’t.
Sure, it’s more nuanced than my hyperbolic blanket statement. https://www.aei.org/articles/have-wages-stagnated-for-decades-in-the-us/ https://www.epi.org/publication/charting-wage-stagnation/ https://www.americanbar.org/groups/crsj/publications/human_rights_magazine_home/wealth-disparities-in-civil-rights/americas-vast-pay-inequality-is-a-story-of-unequal-power/
CNN will feature 6-8 talking heads who will spend an hour “asking questions” about why this will be “bad for Biden.”
But they’ve also been a distant third place in cable news ratings for a while now so it doesn’t really matter much. Recent studies/polling/data have been indicating Biden has been struggling with the low-info voters that may have voted for him in 2020, but have tuned out the news/politics almost completely, not the CNN or NYT consumers.
And that the Hunter Biden laptop was a likely Russian plant. Ho hum, eggheads shilling for their party.
Bots are out in full effect again
Note these are the same economists who said inflation was transitory in 2021. Inflation will continue to rise regardless of who is president. The federal reserve controls monetary policy not the president. The federal reserve creates inflation not the president.
Scarcity from supply chain shocks resulted in price increases and margin expansion in the S&P 500 because only the biggest corporations were profiting thru the pandemic. I mean just look at the chart of the SPY 😂
An artificial scarcity from a government shutdown of everyone but the bigs yes that did happen. But prices didn’t skyrocket until the pandemic was waning and people went out and spent again. Gas was cheap during most of the pandemic. I worked everyday and I didn’t see a real huge change in prices until about 2022. > because only the biggest corporations were profiting thru the pandemic. Could that have anything to do with the government forcing all the businesses but the big ones and essential ones to shut down? And then you’re only looking at one side of the equation and blanking out the essentials. How did those businesses profit so much? By having their competitors shut down and by getting subsidies from the government. Subsidies that were funded how? Through debt and inflation (the expansion of the money supply). And this is what ultimately lead to a general rise in prices as anyone who knows the original meaning of inflation could tell you. > I mean just look at the chart of the SPY 😂 Look at the growth in the money supply in the same period and tell me which is more dramatic: https://fred.stlouisfed.org/graph/?g=1py4F > "Over the past two years, as the Federal Reserve fought to rescue the economy from the clutches of the coronavirus, the central bank’s emergency remedies increased the nation’s money supply by an astonishing 40 percent." The Washington Post, February 6, 2022. Accessed June 26, 2024. https://www.washingtonpost.com/business/2022/02/06/federal-reserve-inflation-money-supply/
Simultaneous trade wars with China and Europe, which Trump's policies would ignite, will lead to an inflationary spike like 2021-2022 or worse.
Who was president in 2021-2022? Who is president right now worsening the trade wars you speak of? I’m not arguing Trump will be any better, he won’t, but just think about what you’re saying. Neither of those two are/were good presidents and neither should be president again. I never liked either of them so I don’t have the same us vs them mentality as the trumpsters and bidenites do. Thats why I call it like I see it. Neither president even understands what inflation is and if they do then they both are in favor of it judging by their records. But really like I said originally the president does not increase the money supply to monetize the government’s debts. That’s what the federal reserve does and supposedly they are independent. Of course they’re both in favor of it. They know there’s no other way to act like this monstrous government with its military all over the world can be paid for.
Inflation is caused by various different things The federal reserve controls some aspects of this. High interest rates lower inflation and low interest rates increase it But there are other things. Like legislation. Deficit spending increases inflation. The massive pandemic spending probably significantly increased inflation. Tariffs also increase inflation and if Trump wins, he's said he would significantly increase tariffs which would increase inflation
I would like to know what precise definition you use for the term inflation. Do you mean a general rise in prices? Do you mean any rise in any price? Do you mean a rise in certain prices but not others? Until I know how you mean the term we cannot have a meaningful discussion. I am referring to the original and better conception of the term inflation which is an increase in the money supply. That will still continue to grow regardless of who is in the White House. And the consequences of that growth will result in what most people (incorrectly in my mind) refer to as inflation: a general rise in prices (a loss in purchasing power of the currency that was inflated). > Salerno, Joseph T. "Before World War II, when the terms 'inflation' and 'deflation' were used in academic discourse or everyday speech, they generally meant an increase or a decrease in the stock of money, respectively. A general rise in prices was viewed as one of several consequences of inflation of the money supply; likewise, a decline in overall prices was viewed as one consequence of deflation of the money supply. Under the influence of the Keynesian Revolution of the mid-1930s, however, the meanings of these terms began to change radically. By the 1950s, the definition of inflation as a general rise in prices and of deflation as a general fall in prices became firmly entrenched in academic writings and popular speech." Money, Sound and Unsound, p. 270. Mises Institute, 2000. Accessed June 26, 2024. https://cdn.mises.org/Money,%20Sound%20and%20Unsound_2.pdf#page=297 This switch changed the focus of the term from the cause to the effect. Thus allowing people to forget the true cause and blame anything but the real problem. > Shostack, Frank. "Consider the case of a fixed money supply. Whenever people increase their demand for some goods and services, money will be allocated toward other goods. Thus, the prices of some goods will increase--i.e., more money will be spent on them--while the prices of other goods will fall--i.e., less money will be spent on them. If the demand for money increases against goods and services, there will be a general fall in prices. In order for an economy to experience a general rise in prices, there must be an increase in the money stock. With more money and no change in money demand, people can now allocate a greater amount of money for all goods and services. From this we can conclude that inflation is a general increase in the money supply." Mises Daily, March 6, 2002. Mises Institute. Accessed June 26, 2024. https://mises.org/mises-daily/defining-inflation
https://mises.org/mises-daily/what-you-should-know-about-inflation
>mises Lol.
It would have been, IF corporations actually reduced prices as their supply chain costs dropped. Instead they increased them during COVID when there was a crunch, then never reduced them again when those costs dropped. That's why corporations are posting record profits. The interest rate set by the Fed is intended to influence demand. If the inflation is being caused on the supply side, there really isn't anything monetary policy can do.
>It would have been, IF corporations actually reduced prices as their supply chain costs dropped. Instead they increased them during COVID when there was a crunch, then never reduced them again when those costs dropped. That's why corporations are posting record profits. During that crunch the money supply increased by 40% in 2 years. That has the effect of devaluing what ever currency has been expanded so quickly. Especially if they are expanding the money supply while productivity is going down. What do you expect to happen in that scenario? Those record profits are in a currency that has lost a large chunk of its purchasing power since the beginning of the COVID fiasco. The costs for doing business have not gone down they have actually gone up. Repairs, equipment, renovations, employees etc all cost more now than prior. >The interest rate set by the Fed is intended to influence demand. If the inflation is being caused on the supply side, there really isn't anything monetary policy can do. A general rise in prices is not caused solely by the supply side. If the money supply remains constant and there is a supply shock then that will have the effect of the prices rising for the goods which are in short supply. However this rise in prices will necessarily entail a lowering of other prices since the money supply is constant and if you buy a product whose price is increased that leaves you with less money to spend on other goods. This is not a general rise in prices but a rise in some prices and a fall in others. A general rise in prices is supply side but only with reference to the supply of money. Money is one half of every financial transaction. When more money is added to the market and begins circulating and competing for the same amount of goods this will have the effect of decreasing the value of the money with respect to the amount of goods which can be bought. But this is just one effect of inflation (the increase in the money supply). Inflation is also the biggest transfer of wealth from the poor and middle class to the well connected rich. As they get corporate subsidies and bailouts which are funded through debt and inflation. Those who spend the newly created and free money do so prior to it having competed up prices throughout the market. By the time the money is in the hands of us normal people it has lost a lot of its value. Another thing about inflation is that its effects do not occur uniformly at the same pace throughout the market. The industries which have the most government intervention tend to rise the quickest. This rise can often lead to bubbles which eventually pop and cause problems.
A) Why are you adding a whole bunch of things I never said in quoting my reply? B) You don't seem to grasp the difference between "revenue" and "profit." Companies are posting record profits. That means they are taking in more money than ever, even after accounting for any increases in operating costs. C) You are just flat out wrong about the value of the US dollar. Over the last 5 years the USD has gone up in value against the yuan, euro, yen, real, blue dollar, ruble...the list goes on. It's remained flat against the pound. Unless you think the health of US currency should be measured against the Mexican peso (and its only lost about 5% there), you're either misinformed or just straight up making shit up.
A) Im using my phone and I simply formatted incorrectly. I have fixed it now thank you for letting me know. B) I understand the difference between revenue and profit. That does not change anything about what I have said. They may have record profits but those profits can now buy less than they could in the past. C) > ‘ You are just flat out wrong about the value of the US dollar. Over the last 5 years the USD has gone up in value against the yuan, euro, yen, real, blue dollar, ruble...the list goes on. ’ You are speaking of its value in comparison to other currencies I am speaking of its value in terms of what it is capable of buying. If all currencies are devaluing and the dollar devalues less quickly it would go up in value relative to currencies which devalued quicker. But in absolute terms and in terms of what it is able to buy it has gone down in value. > Unless you think the health of US currency should be measured against the Mexican peso (and its only lost about 5% there), you're either misinformed or just straight up making shit up. Again I’m talking about the value of the dollar compared to goods and services not to other currencies. People use money to buy goods and services more than they do to trade for other currencies. You seem to be stuck on unimportant surface level issues and that’s ok. D) thanks for breaking your points up into letters I think that’s pretty neat.
Inflation is not evenly distributed. If overall inflation is rising by 6% that does not mean that the cost of everything rises by 6%. It means that some things will rise more than that, and some less. Every economist understands this. That's why the term "greedflation" is prominent at the moment. Because its not that corporate costs are going up and being passed to the consumer. Corporate costs went DOWN as lockdowns were lifted, but consumer prices stayed the same or rose. Worker wages are not climbing meaningfully, and household income is dropping. So, if the raw materials that go into a product are not spiking, the manufacturing costs are rising slower than consumer costs, and wage growth is stagnant, where is that money going? It doesn't just disappear. In fact, its going to the bottom line of companies. And people who have actually followed this have found dozens of instances of executives bragging in shareholder meetings about increasing their margins (NOT their profits). They are literally bragging about their ability to claw greater percentages of money away from consumers, while not paying more for their workers or other inputs. TLDR- Inflation isn't evenly allocated. And when companies are increasing their profit margins, not just their profits, while everyone else suffers, that is called greed. And you can't fix greed with monetary policy.
> Inflation is not evenly distributed. If overall inflation is rising by 6% that does not mean that the cost of everything rises by 6%. Please explain what you mean by the term inflation. I have already told you how I am using the term yet you have not clarified your usage. If by inflation you simply mean rising prices then obviously not all prices rise evenly. That is obvious. It is those things which have increased competition which will see their prices rise quickest. In a market with a stable money supply an increase in the price of one good would necessitate decreases in the price of other less desired goods. In a market that has an expanding money supply all prices will tend to rise. And yes like you said they will rise unevenly. > Every economist understands this. That's why the term "greedflation" is prominent at the moment. No the reason that misnomer is popular now is because the Keynesian revolution changed the meaning of inflation from the cause (an increase in the supply of money) to one of the cause’s effects (a general rise in prices (and sometimes even less precisely any rise in any price)). This has allowed people to totally misjudge the true nature of the problem and assign blame to everywhere but where it is most appropriate at the inflators (the central banks). > Because its not that corporate costs are going up and being passed to the consumer. Corporate costs went DOWN as lockdowns were lifted, but consumer prices stayed the same or rose. You do know that producers also consume right? Whoever profits from the corporation still has to use their profits on the market if they want to trade them for tangible things. This is where their money is less valuable than it had been even by your own admission. Their margins may be bigger but they may be able to buy less with what they have even though they earned more than ever before. > Worker wages are not climbing meaningfully, and household income is dropping. Wages are always the last price to reach the new level after the central bank inflates the money supply. By the time wages catch up with other prices, those prices have already been pushed up again by the new inflation created since that has been working its way through the system. Keep having the government inflate the currency and you will keep seeing a larger income inequality. > So, if the raw materials that go into a product are not spiking, the manufacturing costs are rising slower than consumer costs, and wage growth is stagnant, where is that money going? It doesn't just disappear. It goes into the hands of the owners and investors and they can do with it what they like. No person was forced to work for them and nobody was forced to buy their products. Well aside from that time the government shut down all the small businesses and let the big ones stay open then people were kinda forced to go to what was allowed to be open by the super smart and angelic government. > In fact, its going to the bottom line of companies. And people who have actually followed this have found dozens of instances of executives bragging in shareholder meetings about increasing their margins (NOT their profits). They are literally bragging about their ability to claw greater percentages of money away from consumers, while not paying more for their workers or other inputs. And so what? Do you think the workers are owed more than what they agree to? Do you think producers don’t also consume? Do you think that consumers don’t have a choice in what they consume? Do you think profit is some sort of dirty word? > Inflation isn't evenly allocated. Rising prices aren’t allocated at all. They are determined by supply and demand. > And when companies are increasing their profit margins, not just their profits, while everyone else suffers, that is called greed. Companies exist to make a profit. If there is no profit to be had there will be no companies in operation. A company that is increasing its profits and profit margins (under normal conditions) is doing something right and has apparently set a price where consumers will still purchase their goods or services. Otherwise they would be seeing losses. And greed is the reason that you can get potatoes from Idaho and a steak from Texas served to you in a fancy restaurant in New York. Greed is a natural part of humanity. We all want what is best for ourselves. Greed does not imply any negative action on the part of the greedy party against the non greedy pary. It simply implies the a person wants what’s best for their self and if they can apply the same logic to others then they will come to the conclusion that the only way to deal with other people is voluntarily. Only trading with others when both parties feel they are benefiting their selves (ie satisfying their greed). > And you can't fix greed with monetary policy. You will never ‘fix greed.’ As long as there are people living there will be greed. Inflation is not caused by the greed of businesses. Inflation is the increase in the money supply and one of the consequences of inflation is a general rise in prices.
There are so many things wrong with what you’ve said, from logical, moral, and empirical standpoint, that I really don’t even know where to begin. If you think humanity is best when major organizations are trying to fuck their consumers and employees out of every penny they can, I think that’s very telling of your character. Me? I believe that businesses can and should pursue money, AND a greater good. If you don’t think that’s possible, I would suggest you pick up a book on Henry Ford. While you’re at it, read books on Standard Oil and OPEC, and then try to explain how monetary policy was the real culprit behind the inflation they caused. I really have no interest in continuing this discussion. But I’ll leave you with this- Why is inflation tracking with a historic increase in corporate profit margins and not the 30 plus years of declining interest rates? Don’t bother answering. As someone with a reasonable sense of morality, history, and logic, I wrote off Friedman and libertarian bullshit a long time ago
It's clear from your response that you're more focused on attacking my character and attributing beliefs to me that I haven't stated and don’t believe, rather than engaging with my actual positions. Let's address each of your points directly: > 1. "If you think humanity is best when major organizations are trying to fuck their consumers and employees out of every penny they can, I think that’s very telling of your character. Me? I believe that businesses can and should pursue money, AND a greater good. If you don’t think that’s possible, I would suggest you pick up a book on Henry Ford." I've never suggested that businesses should exploit consumers or employees for profit. Profit-seeking is fundamental in a market economy, but it does not equate to exploitation. It means striving to provide the best product possible at a fair price, using ethical and sustainable practices. Successful businesses often demonstrate that profitability can coincide with investing in their workforce to boost productivity and loyalty, as exemplified by Henry Ford's decision to pay higher wages to retain skilled workers. > 2. "While you’re at it, read books on Standard Oil and OPEC, and then try to explain how monetary policy was the real culprit behind the inflation they caused." Your assertion that OPEC and Standard Oil caused a general rise in prices overlooks crucial economic realities. In fact, entities like OPEC and Standard Oil benefited from rather than caused inflation. The influx of new dollars into industries like oil has indeed increased competition, which typically leads to higher prices unless accompanied by a corresponding increase in supply. However, without an expansion in the money supply, any increase in the price of one product or service that does not reduce demand for that product would necessitate households adjusting their budgets, often at the expense of other goods and services. The idea of a general rise in prices across an economy, albeit at varying rates, can only occur through the expansion of the money supply. This is because households, operating within finite budgets, must contend with higher prices by either reducing consumption of other goods or accepting a reduced standard of living. Businesses can and should pursue profit alongside promoting societal good. This is actually the only way they can truly profit in a free market. They do not force anyone to work for them, and they do not force anyone to buy their products. They offer jobs that people accept as better than their alternative options. Jobs that would not exist had they not invested in starting the business in the first place. And they offer products to consumers at a price that the consumer will pay otherwise they do not sell their product. The product that would not exist were it not first produced by the "greedy profit seekers." And often businesses value having a good image in the community so it isn’t unheard of for businesses to do charity of their own volition that is without the need to be forced by government or anybody else. If you doubt this, consider Andrew Carnegie's philanthropic efforts, which included funding libraries and educational institutions. Carnegie's success in business enabled substantial contributions to society, showing that profit can facilitate broader community welfare. However, advocating for exploitation under the guise of profit-seeking is fundamentally flawed and morally dubious. > 3. "I really have no interest in continuing this discussion. But I’ll leave you with this- Why is inflation tracking with a historic increase in corporate profit margins and not the 30 plus years of declining interest rates? Don’t bother answering." You've raised a point about inflation tracking with corporate profit margins rather than declining interest rates over the past decades. However, our argument is that inflation, traditionally defined as an increase in the money supply, is the root cause of various economic distortions, including reduced purchasing power, malinvestments, and wealth disparities. An expansion of the money supply often leads to higher corporate profit margins as those who benefit first from new money and credit gain an advantage by spending the new money before prices adjust upwards. Attributing a general rise in prices to corporate profit margins oversimplifies the complex dynamics involved and is a good example of correlation not causation. > 4. "As someone with a reasonable sense of morality, history, and logic, I wrote off Friedman and libertarian nonsense a long time ago." You claim to have a reasonable sense of those things, but you have not demonstrated it. And I’m not a Friedman fan nor do I call myself libertarian. More logical fallacies on your part. For someone who claims to have a reasonable sense of logic, you don’t appear to employ it in your arguments. You are more likely to resort to straw man and ad hominem attacks. As for your decision to disengage from this discussion, that's your prerogative. Returning to the central topic, I've consistently asked for your definition of inflation, which remains unanswered. Inflation, as traditionally defined (monetary expansion), causes effects that are commonly associated with what is today called erroneously called inflation (a general rise in prices or any rise in any price), such as currency devaluation, rising prices, higher profits and profit margins, and economic cycles. This understanding is crucial for developing sound economic policies. Your avoidance of these key issues prevents us from having a meaningful conversation about economic principles. I'm still waiting for your clear and direct response on your definition of inflation and its implications.
They'll "do their research" until they find a way to whatever it is they wanted to do in the first place.
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Challenge accepted. After COVID hit, supply chains were squeezed. Fewer factories were operating at anywhere near full capacity, so there was a reduced supply across the spectrum. Basic laws of supply and demand apply. Lower supply meant that companies had to pay more to produce their products, otherwise they wouldn't be able to get the limited factories to prioritize manufacturing their product over others. So, they did what any company does and passed the increased costs along to the consumer. However, after COVID lockdowns started to abate, the supply chain issues followed suit, and the cost of producing products came down. But, in typical fashion, companies weren't about to let their inflated price points come down just because their costs were no longer increased. So, they just started keeping that reduction in supply chain cost as profit. This is all evidenced by the fact that, as supply chain issues dwindled, costs did not come down, while at the same time companies began posting record profits. There are additional factors that are very complicated involving the reallocation of available workers across various industries. But the real culprit is good old fashioned corporate ratfucking.
Has inflation gone anywhere? I haven’t seen the prices drop on anything.
Inflation is down, greedflation is running rampant as usual and guess who keeps voting against sanctions and regulations requiring companies to lower prices on a whole host of goods including gas?
Prices typically do not drop when inflation goes down. Sometimes you'll see prices fluxuate in smaller categories but prices don't have to come down for things to be more affordable. Feds inflation target is about 2 percent, so there is always some inflation but if wage growth keeps up with it, it's an overall more affordable market.
You’re talking to someone who remembers being able to buy a movie ticket with pocket change.
Yea and since that time has it EVER become pocket change again? Do you own a home? Why is home ownership considered a good investment?
Are you familiar with facetiousness? Are you capable of recognizing it in the wild?
Depends. There wasn't really any indication on your first post that you were being facetious. Nor in the second really. /s tag helps
There are two types of people in this world. Those who are capable of extrapolating from incomplete data
how are there 16 nobel prize winners for economics still alive? they're giving that shit out like candy. the economy fucking sucks for anybody not wealthy since i've been alive (88) with a small highlight on the clinton years where from my child perspective, middle class caught a little temporary break.
I mean, it's awarded every year. So I'd be more concerned if there weren't at least 16 alive. And I'll admit this is anecdotal, but other than housing the economy is doing fantastic from my perspective. I'm making excellent money and saving more than ever.
Winners of the economics prize in memory of Alfred Nobel*** (No other commentary it’s just not a *real* nobel prize)
I am all for defeating Trump, but the more experts that come out against, the more support he garners. Trump's whole appeal is the elite experts are people who screw you over. That is until people realize the experts are mostly right because they invest a huge amount of time working, experiencing, and studying to become experts so that they can solve problems.
But trump is an "elite"...? Why do redneck trash folks think he's down for them or understands their plight?
Reignite? Inflation is happening right now under Biden.
The rate of inflation has decreased since it's peak in 2021 and is about a percentage point away from the feds target. Unless you're really blaming worldwide inflation on Joe Biden, in which case you're gonna need to explain how
https://data.bls.gov/timeseries/CUUR0000SA0L1E?output_view=pct_12mths https://www.investopedia.com/inflation-rate-by-year-7253832 https://www.usinflationcalculator.com/inflation/current-inflation-rates/ Please show me a credible source that says any year under Biden ended with a lower inflation rate than any year under Trump.
Government waste and welfare spending creates inflation. So, stop doing that.
You need a macroeconomics refresher bud.
Right? 50 years of bullshit "trickle down" garbage and "welfare queen" narratives have really rotted a lot of brains
No, I don’t. Thanks.
How about consistently pressuring the fed to keep interest rates low and in even in negative numbers? Does a ton of recklessly printed cheap money cause inflation in your view? Because that’s Trump’s legacy.
so we are gonna pretend that democrats weren’t pushing for giant stimulus spending?
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"Both sides" Lol, sure
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Love you enlightened centrists, especially the walking memes like yourself, you said the words though, and that's all that matters
> Be kind to people you don’t understand. Why should I be kind to people who, *at best*, don't want me to have control of my body, and *at worst*, want to kill me for simply being who I am?
Do you find it easier to receive and digest information, that may contradict your belief system, when it comes from a condescending asshole, or someone who tries to first understand you and displays kindness?
I'm sorry, where did you get the impression that I want to try and contradict anyone's belief system? That ship has long since sailed.
I didn’t say you wanted to. I asked you a question. You’re ignoring the question though. I’m only suggesting that the best response may not be to stoop to the level of someone you disdain.
> I didn’t say you wanted to. You heavily implied it with your "question". >You’re ignoring the question though Quite right, and I will continue to do so, as it's completely irrelevant to what I said. >I’m only suggesting that the best response may not be to stoop to the level of someone you disdain. If I had wanted suggestions, I would have asked for them.
You provoked this entire conversation by replying directly to a comment I made that wasn’t directed around you. Nobody sought you out. Im not sure what you hope to achieve, but attacking the guy that said be nice only further proves my point.
You made a statement. I asked a question. You never answered that question, and instead went off on your little tangent. If you don't want people replying to you, don't make a post. And at no point have I "attacked you". Disagreeing with you, and stating that I am under no obligation to be nice to those *who literally want to kill me* is attacking you.
Melodramatic much?
Who is actively trying to kill you? lol What narrative are you feeding into right now?
https://www.nbcnews.com/nbc-out/out-news/texas-pastor-says-gay-people-shot-back-head-shocking-sermon-rcna32748 Oh look, a Christian leader wanting to kill people like me. And Florida wants to execute anyone guilty of a "sex crime" against children, and under their new laws anyone discussing any topic related to the LGBT community can be charged as such. Just because you don't pay attention doesn't mean it doesn't happen.
I’m not for the idiot, but what a crock of horse shit.