Don't get too giddy about the economy. The war in the Middle East is not over by any means. Iran must make sure Israel is held accountable for attacks in the area.
Agree. I also don't believe the economy is doing as well as all claim. Virtually every economic number from the 1980s has been redefined to make things look better such as inflation and how they count unemployed. Reminds me of the band playing while the Titanic was going down. Keep the people entertained and keep their minds off where critical numbers are going like Deficits, the National Debt, and the Interest paid on it and how this is accelerating while we are not in a recession and the stock market is sky high. One can only imagine those numbers during a recession.
I think the Federal Reserve, as well as other central banks, are more of a problem than a solution. They utilize interest rates, which are a blunt instrument, while continuing to expand the money supply at a faster rate, which is what causes inflation, as per Professor Hanke. Also, the Fed never gets all the data it needs and some of that data is changed dramatically two or three months down the road. The idea that an institution such as the Fed can perfectly manage an economy as complex as America's is something one would have expected in the Soviet Union: Central Planning. After all, the Federal Reserve looks after its banker friends first. The fact that a so-called free market capitalistic country has a monopolistic, unelected bunch of bureaucrats who have no clue in nothing short of insane (remember the comment about "transitory" inflation?).
An absolutely superb explanation of the current state of the global economy. Thanks Lena!
Are central bankers doing the right thing? Could the question be are central bankers looking for the ALMOST zugawang chess position so that the global economy can successfully squeeze out of a recession?
There is another question related to money supply: Couldn't a "might makes right" economy, mainly the US, just print enough money to defeat the debt? Couldn't they even print money off the books so to speak?
I would say, Yes the raising of interest rates is better than the other direction. Though I would make a clause that persons under current credit card debt keep the rate as when their debt started. But keeping this quiet, so people don't intentionally rack up enormous debt - for example say paying for their kid's college tuition - with the thinking that their particular rates won't change in the future. The last thing advanced economies need is to have an endless cycle of cheap money. Small business can also group together for a reduced and flat interest rate and if one party falters on payments it doesn't affect the other parties's common interest rate. Could this be the equivalent of a Phil Rizzuto squeeze play? In an almost zugzwang position perhaps it's desirable to try.
"There is another question related to money supply: Couldn't a "might makes right" economy, mainly the US, just print enough money to defeat the debt? Couldn't they even print money off the books so to speak?"
That is exactly what they are doing! It's called fiat money
Don't get too giddy about the economy. The war in the Middle East is not over by any means. Iran must make sure Israel is held accountable for attacks in the area.
Agree. I also don't believe the economy is doing as well as all claim. Virtually every economic number from the 1980s has been redefined to make things look better such as inflation and how they count unemployed. Reminds me of the band playing while the Titanic was going down. Keep the people entertained and keep their minds off where critical numbers are going like Deficits, the National Debt, and the Interest paid on it and how this is accelerating while we are not in a recession and the stock market is sky high. One can only imagine those numbers during a recession.
For me, your comments are spot on.
I think the Federal Reserve, as well as other central banks, are more of a problem than a solution. They utilize interest rates, which are a blunt instrument, while continuing to expand the money supply at a faster rate, which is what causes inflation, as per Professor Hanke. Also, the Fed never gets all the data it needs and some of that data is changed dramatically two or three months down the road. The idea that an institution such as the Fed can perfectly manage an economy as complex as America's is something one would have expected in the Soviet Union: Central Planning. After all, the Federal Reserve looks after its banker friends first. The fact that a so-called free market capitalistic country has a monopolistic, unelected bunch of bureaucrats who have no clue in nothing short of insane (remember the comment about "transitory" inflation?).
An absolutely superb explanation of the current state of the global economy. Thanks Lena!
Are central bankers doing the right thing? Could the question be are central bankers looking for the ALMOST zugawang chess position so that the global economy can successfully squeeze out of a recession?
There is another question related to money supply: Couldn't a "might makes right" economy, mainly the US, just print enough money to defeat the debt? Couldn't they even print money off the books so to speak?
I would say, Yes the raising of interest rates is better than the other direction. Though I would make a clause that persons under current credit card debt keep the rate as when their debt started. But keeping this quiet, so people don't intentionally rack up enormous debt - for example say paying for their kid's college tuition - with the thinking that their particular rates won't change in the future. The last thing advanced economies need is to have an endless cycle of cheap money. Small business can also group together for a reduced and flat interest rate and if one party falters on payments it doesn't affect the other parties's common interest rate. Could this be the equivalent of a Phil Rizzuto squeeze play? In an almost zugzwang position perhaps it's desirable to try.
"There is another question related to money supply: Couldn't a "might makes right" economy, mainly the US, just print enough money to defeat the debt? Couldn't they even print money off the books so to speak?"
That is exactly what they are doing! It's called fiat money