The complaints of inflation are insane.

[Farm Boy]

Like food and heating supplies? The supply demand curve on that one is not the same as for toasters and vacuums.

 

[Samson]

Yeah, those and the radiation levels in the water and the mutants of the wastelands and stuff.

 

[El_Machinae]

"Transitory" means "stops increasing as much" when it comes to inflation, not that prices come down.

Given that global trade could decrease even more, plus currencies flooding back their homes, we really could see some stagflation or inflation. But to see anything other than transitory inflation in such a circumstance, you'd need new money being created. If people are borrowing less out of fear, I'm not sure we'll see that.

Betting on inflation is actually pretty easy, but if no one is betting it will happen, it's much less likely to happen.

 

[Farm Boy]

There are actual material shortages of fertilizer and herbicide. Less acres will get full inputs. Weather is still yet to be seen. Fuel is yet to be seen, but as prices spike biofuel becomes more price competitive. Americans can shift from protein to carbs. They can switch from organics to regular person food. We aren't the canaries on food.

If I want to get philosophical, even severe food shortage is self rectifying and transitory. Depending on how words get used.

 

[Hygro]

How has this thread aged like milk when the original argument is a shortage caused a multiyear inflation shock, which is continued by Russian warmongering? The complaints of the inflation are the same.

Biden's plan to deal with inflation is the correct one. Invest in capacity here in America. Obviously that is still inflationary in the short run. But it's not inflation, it's actual wealth that matters.


Farm Boy, who are the food canaries to watch?

 

[Joij21]

Oh so you like the ridiculously high inflation caused by supply shortages? Please tell me how exactly this is all transitory when gas is now over $4 a gallon and keeps going up? Or are you just rich and can afford the higher costs of living?

 

[Farm Boy]

In the past I would keep an eye on Egypt and Venezuela.

 

[Lexicus]

Inflation caused by Russian invasion is still ultimately being caused by a supply shock. Attacking the purchasing power of anyone is not the right way to deal with supply-shock inflation.

Oh so you like the ridiculously high inflation caused by supply shortages? Please tell me how exactly this is all transitory when gas is now over $4 a gallon and keeps going up? Or are you just rich and can afford the higher costs of living?

Transitory means temporary

 

[Farm Boy]

Increasing the purchasing power of Americans ultimately maintains biofuel traveling and meat eating. I've already stopped buying beef for the most part. It will first price out exports of calories, those will be the canaries of inflation.

 

[Joij21]

Transitory means temporary

It ain't temporary! Mark my words! It's only gonna go up and up from here until the whole rotted structure comes tumbling down!

 

[El_Machinae]

Oh so you like the ridiculously high inflation caused by supply shortages? Please tell me how exactly this is all transitory when gas is now over $4 a gallon and keeps going up? Or are you just rich and can afford the higher costs of living?

I see the disconnect. "Inflation" is just too many dollars chasing too few goods and services (G&S). That's all it is, and we all recognize that it's painful.
Now, you can trigger it by having the supply of money increase too quickly. Or you can trigger it by having the supply of G&S fall.

People in this thread are treating the fall in supply as a natural event, something that's gonna happen (first covid-19, then the Europe crisis, then the Taiwan incidient, and then the initiation of WWIII over the Himalayas due to water shortages ...). Obviously, a rise in G&S would be better, but it's not happening. It's falling. Ergo, inflation.

The only way to 'prevent' this inflation would be to pull money out of the system. The contention is that this would be a bad idea, and wanting it would be 'insane'.

 

[Farm Boy]

You pull them out of the top, so production stops chasing luxury goods and services so hard. So you reinvest in the shortfalls.

 

[Joij21]

That's why we need to increase goods and supplies by drilling for our own oil and building the Keystone Pipeline. But no, people think Biden is a genius for making us rely on an old global economic order that is falling apart. We need to start making goods here in the U.S. and we need energy independence now!

 

[Hygro]

Oh so you like the ridiculously high inflation caused by supply shortages? Please tell me how exactly this is all transitory when gas is now over $4 a gallon and keeps going up? Or are you just rich and can afford the higher costs of living?

This is the highest I've seen gas.

However it has been more relatively expensive and almost the same price numerous times in my life including 15 years ago. As I live in an expensive area, I've been seeing general inflation at the current national every year. When it was 1% for wherever USA, it was 7.5% here. The average rate last decade was under 2%, but never that low here. I save on rent because I have lived at home, but I don't save on food, I do eat organic when at home, often, and eat out more often. I have mostly made around $1000/month for the past 6 years. We'll come back to this.

Again I'm not saying the complaints against a supply shortage are insane. I'm not saying the consequent unhappiness by that shortage are insane. I'm saying complaints against the inflation itself is insane. Here's why:

The tool to fight inflation itself, without fighting any of the reason for it, is to restrict money (higher taxes, or raised rates), or to ration things. All of these solutions, as well as letting the inflation happen, have the same over all outcome. You get less stuff compared to before the Pandemic (and now the invasion).

Furthermore, in the case of the money supply, we knew we were going to have inflation when the supply loss didn't correspond to a demand loss. The question is, what did you collect? I collected about $20k in unemployment from one of my jobs (uber drive). I was supposed to collect twice as much but there was a supply shortage of staff. That's on top of the stimulus. In addition to the inflation being the same rate as always for right here in the Bay Area, my income effectively doubled for 2 years. So my money went up 3x, and my prices went up, let's round up 1.2x.

We did a bad case fixed income where the stimulus gains against a punitive red state government who held federal back rom its people, and it comes out a wash. And many of us, at the bottom, collected big checks beyond our previous income. Allllllll of this money and prices only went up a bit. The rest of the country caught up to our regular uneventful amount. If you or a member of your team (family, or anyone you lean together with) got this extra income, your team came out ahead of the inflation.

 

[Hygro]

You pull them out of the top, so production stops chasing luxury goods and services so hard. So you reinvest in the shortfalls.

Farm Boy Roberts for Governor.

 

[Joij21]

The tool to fight inflation itself, without fighting any of the reason for it, is to restrict money (higher taxes, or raised rates), or to ration things.

Your missing the third option. An increase in production. Why can't we deregulate industry in order to allow them to make more and cheaper goods right here in the U.S. ?

Or is it because this third option is too conservative for you to even consider an option because of climate change wokeism?

 

[El_Machinae]

Your missing the third option. An increase in production. Why can't we deregulate industry in order to allow them to make more and cheaper goods right here in the U.S. ?

Changing this is a vastly slower process, and is very much not helped with depreciation. It's not a 'third option', because we're talking month-to-month statistics here. They're separate issues, because inflation is today from this month. Changing production is "backing up a steamliner territory".

Sure, increasing production over the longer run is the answer to poverty, as long as you handle allocation and waste. I think everyone knows it.

Or is it because this third option is too conservative for you to even consider an option because of climate change wokeism?

Basically every AGW analysis shows that it's going to cause huge and massive supply deficits, but at the cost of the present stealing from the future poor people far away. It's a bit like insisting we fight transitory rises in corn prices by eating the seed corn. It's just the wrong lever to pull.

 

[Hygro]

Your missing the third option. An increase in production. Why can't we deregulate industry in order to allow them to make more and cheaper goods right here in the U.S. ?

Or is it because this third option is too conservative for you to even consider an option because of climate change wokeism?

Joij: confirmed non reader.

Biden's plan to deal with inflation is the correct one. Invest in capacity here in America. Obviously that is still inflationary in the short run. But it's not inflation, it's actual wealth that matters.

 

[Hygro]

 

[Joij21]

Joij: confirmed non reader.

Ok fine I didn't actually read the whole post. But for me to trust Biden's plan he would have to part the Red Sea and do all manner of miracles to change my opinion of him come reelection time. And he only has two years left to make me a fan.