Inflation Scaremongering
I've been reading in different places that one of the problems with gas prices is that the U.S. has run out of refining capacity.
Another capitalism/petro-bizness fail.
Let's give them more subisidies.
drummerboy said:
Smedley said:
drummerboy said:
Smedley said:
drummerboy said:
more speculation on whether the Fed's approach (their only approach) to fight inflation is correct.
https://thehill.com/opinion/finance/3506214-the-feds-cure-for-inflation-is-worse-recession/
Great stuff from a Fox News commentator and former advisor to Newt Gingrich.
Here’s a better state of play article:https://www.washingtonpost.com/us-policy/2022/05/31/inflation-economy-timeline/
Nice Monday morning quarterbacking there.
Kind of useless information today.
And that makes it better than what, exactly?
Better than a half-baked opinion piece from a Fox News guy.
which you clearly haven't read.
I scanned it and saw the brilliant takeaway "The current Fed tightening spree should be stopped."
Pray tell, why do you seem to endorse the out-there monetary policy prescription of "a political strategy and policy consultant and frequent network television and radio commentator."
What gives you confidence this guy knows more than the Federal Reserve itself?
Smedley said:
drummerboy said:
Smedley said:
drummerboy said:
Smedley said:
drummerboy said:
more speculation on whether the Fed's approach (their only approach) to fight inflation is correct.
https://thehill.com/opinion/finance/3506214-the-feds-cure-for-inflation-is-worse-recession/
Great stuff from a Fox News commentator and former advisor to Newt Gingrich.
Here’s a better state of play article:https://www.washingtonpost.com/us-policy/2022/05/31/inflation-economy-timeline/
Nice Monday morning quarterbacking there.
Kind of useless information today.
And that makes it better than what, exactly?
Better than a half-baked opinion piece from a Fox News guy.
which you clearly haven't read.
I scanned it and saw the brilliant takeaway "The current Fed tightening spree should be stopped."
Pray tell, why do you seem to endorse the out-there monetary policy prescription of "a political strategy and policy consultant and frequent network television and radio commentator."
What gives you confidence this guy knows more than the Federal Reserve itself?
The Fed is not all-knowing. They make mistakes.
The Fed has exactly one tool for fighting inflation. Inflation is complex - maybe that tool is not the best, but they feel forced TO DO SOMETHING!!!
There are many people saying that raising rates is inappropriate in today's context. Is a recession/drastic-slowdown really want we want right now? This assumes that inflation is being caused by a too-hot economy and excessive demand. Are those really our primary inflationary pressures? A lot of economists don't think so.
Steve said:
nohero said:
Steve said:
What would be nice to see as part of this analysis is the cost of a gallon of gas in current dollars ex-taxes. Seems a bit like comparing apples to oranges when taxes are included given the increase in both state and federal gas taxes over the years.
The comparison is to the average retail prices over the years, so the taxes are a part of that price. And, the price the customer pays is the one to compare over the years.
Yes, but my point is that the increase is not due solely to market forces/inflation, but other factors as well. A few years ago, we had here in NJ a - I think - $.29/gallon increase in the gas tax. That amount (and other additional tax increases) have nothing to do with inflationary pressures.
I agree, but the point wasn't about the cause of the price level. The discussion was about the consumer experience, which shows that for the consumer the price is about the same, and lower than the "peaks", adjusted for inflation.
drummerboy said:
Smedley said:
drummerboy said:
Smedley said:
drummerboy said:
Smedley said:
drummerboy said:
more speculation on whether the Fed's approach (their only approach) to fight inflation is correct.
https://thehill.com/opinion/finance/3506214-the-feds-cure-for-inflation-is-worse-recession/
Great stuff from a Fox News commentator and former advisor to Newt Gingrich.
Here’s a better state of play article:https://www.washingtonpost.com/us-policy/2022/05/31/inflation-economy-timeline/
Nice Monday morning quarterbacking there.
Kind of useless information today.
And that makes it better than what, exactly?
Better than a half-baked opinion piece from a Fox News guy.
which you clearly haven't read.
I scanned it and saw the brilliant takeaway "The current Fed tightening spree should be stopped."
Pray tell, why do you seem to endorse the out-there monetary policy prescription of "a political strategy and policy consultant and frequent network television and radio commentator."
What gives you confidence this guy knows more than the Federal Reserve itself?
The Fed is not all-knowing. They make mistakes.
The Fed has exactly one tool for fighting inflation. Inflation is complex - maybe that tool is not the best, but they feel forced TO DO SOMETHING!!!
There are many people saying that raising rates is inappropriate in today's context. Is a recession/drastic-slowdown really want we want right now? This assumes that inflation is being caused by a too-hot economy and excessive demand. Are those really our primary inflationary pressures? A lot of economists don't think so.
The Fed chose to not raise interest rates late last year, despite rising inflation, on the premise that inflation was "transitory" - that the inflation at the time wasn't due to a too-hot economy and excessive demand. Just what you're saying here. But, it turned out inflation wasn't transitory. Now you're saying they should do nothing some more and maybe even roll back the meager 0.75% they've hiked so far? That's just doubling down on a losing bet. Definition of insanity...
And given the Fed's dual mandate is to promote a strong job market and to keep inflation in check, at this point it would essentially be malpractice on the part of the Fed to do nothing on rates and just hope inflation subsides this time. Fool me once...
And one can always find fringe views on anything, like your Fox News guy. But there is no more than a fringe of economists who think the Fed should not raise rates.
yeah, the fringe. you know who else was in the fringe? those economists that warned about a housing bubble pre-2008 that the Fed completely ignored.
Why didn't the Fed act sooner during this current bout of inflation?
Did anyone ever define what transitory even meant? There's evidence that inflation has started to moderate, before the Fed's action.
Anyway, have fun with a needless recession. With high gas prices to boot, since the Fed's action will have zip effect on that.
drummerboy said:There's evidence that inflation has started to moderate, before the Fed's action.
You've mentioned that before, so I'll note this again: The annual inflation percentages released each month have a head start on moderating now simply because prices were so inflated in the comparison 2021 months. (It's like that 1980 gas price: The baseline is elevated.)
drummerboy said:
yeah, the fringe. you know who else was in the fringe? those economists that warned about a housing bubble pre-2008 that the Fed completely ignored.
Why didn't the Fed act sooner during this current bout of inflation?
Did anyone ever define what transitory even meant? There's evidence that inflation has started to moderate, before the Fed's action.
Anyway, have fun with a needless recession. With high gas prices to boot, since the Fed's action will have zip effect on that.
Well presumably as you started this post in the political section, you have a political angle to this thread. And as you are a loyal Democrat, I suspect your angle is that a recession would be bad for D chances this fall and in 2024. But don't you see the current polls, approval ratings and projections for the midterms, which are all unfavorable for Democrats? And all that's WITH the current economic conditions of strong top-line economic numbers and high inflation.
So if you want the economy to improve Democrats's prospects, I don't know why you're advocating for more of the same. I'd think you'd be more concerned with getting inflation -- the #1 voter issue -- under control.
Smedley said:
drummerboy said:
yeah, the fringe. you know who else was in the fringe? those economists that warned about a housing bubble pre-2008 that the Fed completely ignored.
Why didn't the Fed act sooner during this current bout of inflation?
Did anyone ever define what transitory even meant? There's evidence that inflation has started to moderate, before the Fed's action.
Anyway, have fun with a needless recession. With high gas prices to boot, since the Fed's action will have zip effect on that.
Well presumably as you started this post in the political section, you have a political angle to this thread. And as you are a loyal Democrat, I suspect your angle is that a recession would be bad for D chances this fall and in 2024. But don't you see the current polls, approval ratings and projections for the midterms, which are all unfavorable for Democrats? And all that's WITH the current economic conditions of strong top-line economic numbers and high inflation.
So if you want the economy to improve Democrats's prospects, I don't know why you're advocating for more of the same. I'd think you'd be more concerned with getting inflation -- the #1 voter issue -- under control.
your presumptions are incorrect.
try again.
nohero said:
Steve said:
nohero said:
Steve said:
What would be nice to see as part of this analysis is the cost of a gallon of gas in current dollars ex-taxes. Seems a bit like comparing apples to oranges when taxes are included given the increase in both state and federal gas taxes over the years.
The comparison is to the average retail prices over the years, so the taxes are a part of that price. And, the price the customer pays is the one to compare over the years.
Yes, but my point is that the increase is not due solely to market forces/inflation, but other factors as well. A few years ago, we had here in NJ a - I think - $.29/gallon increase in the gas tax. That amount (and other additional tax increases) have nothing to do with inflationary pressures.
I agree, but the point wasn't about the cause of the price level. The discussion was about the consumer experience, which shows that for the consumer the price is about the same, and lower than the "peaks", adjusted for inflation.
Right, and it would likely be even lower if only the cost of gas were included in this analysis.
I am in KC. Gas was 3.93 this am. Generally has been around 4.11 the last few days.
KC sounds good, generally about $4.80 these days in Milwaukee (and that's with potholes too).
sbenois said:
I am in KC. Gas was 3.93 this am. Generally has been around 4.11 the last few days.
looks like some big storms already popping. Fun times
sbenois said:
I am in KC. Gas was 3.93 this am. Generally has been around 4.11 the last few days.
Sunday Crossword indicated that the U.S. is home to 75% of the world’s tornadoes.
Had no idea!
The monetary policy has been insane for at least a generation. Sooner or later you've got to pay the piper and we are certainly overdue. The problem right now isn't that there is inflation. The Fed likes and encourages inflation. The problem is that they lost control over it.
Due to the amount of debt in our system and the fact that the dollar may be slowly losing its reserve currency pedestal, painless solutions are not likely to show themselves.
terp said:
The monetary policy has been insane for at least a generation. Sooner or later you've got to pay the piper and we are certainly overdue. The problem right now isn't that there is inflation. The Fed likes and encourages inflation. The problem is that they lost control over it.
Due to the amount of debt in our system and the fact that the dollar may be slowly losing its reserve currency pedestal, painless solutions are not likely to show themselves.
"The Fed likes and encourages inflation." ??
One of your wrongest statements ever.
drummerboy said:
terp said:
The monetary policy has been insane for at least a generation. Sooner or later you've got to pay the piper and we are certainly overdue. The problem right now isn't that there is inflation. The Fed likes and encourages inflation. The problem is that they lost control over it.
Due to the amount of debt in our system and the fact that the dollar may be slowly losing its reserve currency pedestal, painless solutions are not likely to show themselves.
"The Fed likes and encourages inflation." ??
One of your wrongest statements ever.
terp said:
drummerboy said:
terp said:
The monetary policy has been insane for at least a generation. Sooner or later you've got to pay the piper and we are certainly overdue. The problem right now isn't that there is inflation. The Fed likes and encourages inflation. The problem is that they lost control over it.
Due to the amount of debt in our system and the fact that the dollar may be slowly losing its reserve currency pedestal, painless solutions are not likely to show themselves.
"The Fed likes and encourages inflation." ??
One of your wrongest statements ever.
You think aiming for 2% inflation means "likes and encourages"?
That certainly explains why you're wrong.
Their policies are structured to cause inflation. Slow and steady. In the aftermath of the 2008 Financial crisis there was talk of setting inflation targets as high as 5%.
terp said:
Their policies are structured to cause inflation. Slow and steady. In the aftermath of the 2008 Financial crisis there was talk of setting inflation targets as high as 5%.
But they didn't, right?
Do you somehow think that today's high inflation is due to the Feds efforts to keep inflation at 2% in the past few decades?
If so, please explain the mechanism.
Well in 2000, the M2 supply was about $4.7 Trillion. It's now almost $22 Trillion. What do you think that has achieved? What do you think it was meant to achieve?
Ah, the old money supply argument of inflation.
So you're saying that the increase in money supply has finally caused high inflation?
How does that work, exactly?
They've been blowing speculative bubbles since Greenspan. There were factions in the Fed that wanted to target 5% inflation because they were concerned about deflation. Nobody complains about this when real estate, the stock market, the bond market, cryptocurrencies, art, etc are going up in price. It's only when it starts hitting the prices of consumer goods that people complain. And of course, they don't like it when the speculative bubbles inevitably pop.
terp said:
They've been blowing speculative bubbles since Greenspan. There were factions in the Fed that wanted to target 5% inflation because they were concerned about deflation. Nobody complains about this when real estate, the stock market, the bond market, cryptocurrencies, art, etc are going up in price. It's only when it starts hitting the prices of consumer goods that people complain. And of course, they don't like it when the speculative bubbles inevitably pop.
that's an explanation?
and while you're working on that explanation, be sure to include the effects of the Fed's monetary policy on the rest of the world, which is coincidentally experiencing high inflation at the same time.
https://www.washingtonpost.com/opinions/2022/06/01/biden-honesty-inflation/
Better late than never I guess. Though this kind of reminds me of the Biden administration sending out masks and Covid tests in January, right after the Omicron wave over the holidays.
Smedley said:
It seems $5 (for regular unleaded) is a bit of a psychological barrier that the local gasoline market is resisting. I've seen several $4.99 9/10s recently but no 5-handles. But I suspect it's inevitable, being we're entering peak summer driving season and oil prices are on the rise.
psychological barrier crossed. Downtown SO Exxon today.
which you clearly haven't read.