They talk about inflation like it comes from a comet out of deep space.
Not one mention that inflation is caused by the government and central banks expanding the money supply.
Not one mention that inflation is caused by the government and central banks expanding the money supply.
The recent inflation is more because of unfettered capitalism. Supply chain issues? Ok let's just keep on raising prices as much as we can. Things back under control? Ok, well we are still going to claim we have issues and just keep on raising prices.
Workers want more money? Ok instead of us shareholders taking the hit, we are going to pass on every bit of that (and more) to the consumer because "we can".
Want to go to a football game? A concert? Disney world? Cool- we are just going to keep increasing prices like crazy because there is a large enough people in the top 10% that will pay because that increase doesn't really matter.
Prices are being driven the fuck up because of greed and income divide.
That glut of new money took a flight to quality in banks and things like tech companies. Such firms, and all the people that contract with them or are employed by them as downstream from this money thus had a warped cost to capital compared to everyone else.
It wouldn’t make sense to operate a business and not choose the customer who can support a higher price point over the lower one with an identical cost, and with such a large delta, increasing margin as a matter of price increase made fundamentally more sense than investing in cost reductions.
The fact is that Central Banks had the largest role to play here assuming that choosing to make more money over less money by simply raising prices is not inherently evil.
> Prices are being driven the fuck up because of greed and income divide.
Maybe...it's both? Could it actually be that the government and central banks collude to prop up the housing and stock markets and print money (through debt creation) in order to make sure that the upper quintile keeps getting paid and the reset squabble about it?
Inflation is just a word that we have for changes between the costs of various goods and services and the amount of money that people are being paid for the work they do (averaged across various parameters to make communication simple). Those changes happen for many reasons, because people aren't making enough money... because people are hording money... because the govt et al increase the supply of money to counteract those phenomena... because the economic chain of supply has shifted... and for some massive combination of all those things and more. The economy is a complex machination that you're deeply oversimplifying with this two sentence comment. Although the government trying to predict such things and get involved can be deeply flawed, the alternative is the crushing burden of unemployment and crumbling structures.
As such, pointing the finger strongly at big government and saying "how dare you get involved" is myopic and heavy handed. We could also easily point the finger at the financiers and real-estate moguls who have brought us into a world where the average worker has little income and extreme "expenses" that filter into the coffers of wall street.
This is a little overstated, no?
I agree the economy is more complicated than simply money supply, but subscribe to Hayek’s view of the pretence of knowledge - that the central bank can possibly manage the economy better than the economy can manage itself. The problem with a small elite managing the money supply is that it isn’t predictable. We see them saying rates will be low for the foreseeable future and then a few quarters later start jacking up interest rates at the fastest rate in 40 years. Well, I guess it just sucks to be anyone that listened to the “low for long” guidance. But this uncertainty has a cooling effect on economic activity. If anything we should trust money supply to a predictable, simple equation rather than the whims of men behind closed doors.