4 ms·

1) Once again, inflation does not work that way. If it did, it would have been out of control in 2009. Instead, it was near zero. The same thing is happening

1) Once again, inflation does not work that way. If it did, it would have been out of control in 2009. Instead, it was near zero. The same thing is happening right now. 2) The idea that 2-3% inflation is "really really serious" is completely absurd. I'm guessing you're young because historical US inflation prior to the ridiculous post-2009 financial situation had long periods of being well above 3% and the sky didn't fall. Inflation above what we've seen in the last decade is not necessarily a bad thing.

hnarn 7y ago
For context, the inflation goal set by the Swedish national bank is 2%. That's what they're aiming for, so clearly it's not "really really serious". CNBC also states that: >The Fed considers a 2% inflation rate to be a sign of sustainable growth and a level that keeps interest rates high enough to allow for mobility in the event of an economic downturn.
- akuchling 7y ago
  1-3% is also the Bank of Canada's target range: https://www.bankofcanada.ca/rates/indicators/key-variables/key-inflation-indicators-and-the-target-range/ https://www.bankofcanada.ca/rates/indicators/key-variables/k...
fauigerzigerk 7y ago
I agree that 2-3% inflation is nothing to worry about. But what's happening now is not quite the same thing as in 2009. For the first time in a very long time we actually have a shortage of supply. We didn't have that in 2009. But I think/hope it will be short lived, and depending on how we act now it could easily turn into a shortage of demand once again.
- jjeaff 7y ago
  Do we really have a shortage of supply? For what products? The only shortages I have seen are for toilet paper and a few random grocery store products that maniacs decide to stockpile next. (in my community, there is all the sudden a run on ice cream now that bread is back in stock).
  - fauigerzigerk 7y ago
    We have a shortage of farm labour for instance, which may soon turn into a shortage of fresh produce and into massive food price inflation. We have a shortage of home delivery capacity. If stuff doesn't get manufactured for months, we will have a shortage of many other things as well. Obviously we have a lack of demand for other things at the same time. I don't think there is that much unreasonable stockpiling. People are no longer eating out. Kids are no longer eating at school. So people buy more at supermarkets. They also buy for a week, quite sensibly, to avoid making a trip to a crowded supermarket every day. Combine that with finely tuned just in time logistics and you get a bit of a crunch. There's simply a misalignment of capacity right now, but there could be a real shortage of some essentials soon.
    - CSSer 7y ago
      Where did the restaurants and the school get their food from? I know that means a great disruption, but I’m still not convinced that means a shortage.
      - nitrogen 7y ago
        Sysco and the like. It's probably a distribution rather than a supply issue.
        sokoloff 7y ago
        Exactly. Typical container size in foodservice distribution is a #10 can, packed 6 to a case. Each #10 can is 3 quarts. Fairly few households are interested in buying canned tomatoes 18 quarts at a time.
  - seanmcdirmid 7y ago
    VR systems and Nintendo Switch systems are also out of supply, they were bought up quickly when the quarantine started and China hasn’t been making any new ones for a couple of months now.
  - 7y ago
mrec 7y ago
> historical US inflation prior to the ridiculous post-2009 financial situation had long periods of being well above 3% and the sky didn't fall True, but misleading; again, it's real rather than nominal rates that matter to most people. Before the GFC you could get interest on savings above the rate of inflation, even after tax. Not spectacular gains, but saving was at least possible. After the GFC your choices are to either a) join the long queue of ever-greater fools piling into the casino, or b) watch central banks confiscate your money, year after year, forever.
thorwasdfasdf 7y ago
i was well aware of the 70s and 80s, that doesn't make it right.
voisin 7y ago
Anyone else have a hard time believing the official inflation numbers? Housing, food, restaurants, electricity, hotels,... anything I can think of that I buy regularly all seems significantly more expensive than it did 10 years ago - much higher than the official numbers would lead me to expect.
- meseeks555 7y ago
  This is my experience as well ... and healthcare and education costs have also gone up much faster than the stated rate of inflation. There are a few areas --- like consumer electronics and maybe food --- where this isn't the case or prices have actually gone down, but only a very few.

hnarn 7y ago

For context, the inflation goal set by the Swedish national bank is 2%. That's what they're aiming for, so clearly it's not "really really serious". CNBC also states that: >The Fed considers a 2% inflation rate to be a sign of sustainable growth and a level that keeps interest rates high enough to allow for mobility in the event of an economic downturn.

akuchling 7y ago
1-3% is also the Bank of Canada's target range: https://www.bankofcanada.ca/rates/indicators/key-variables/key-inflation-indicators-and-the-target-range/ https://www.bankofcanada.ca/rates/indicators/key-variables/k...

fauigerzigerk 7y ago

I agree that 2-3% inflation is nothing to worry about. But what's happening now is not quite the same thing as in 2009. For the first time in a very long time we actually have a shortage of supply. We didn't have that in 2009. But I think/hope it will be short lived, and depending on how we act now it could easily turn into a shortage of demand once again.

jjeaff 7y ago
Do we really have a shortage of supply? For what products? The only shortages I have seen are for toilet paper and a few random grocery store products that maniacs decide to stockpile next. (in my community, there is all the sudden a run on ice cream now that bread is back in stock).
- fauigerzigerk 7y ago
  We have a shortage of farm labour for instance, which may soon turn into a shortage of fresh produce and into massive food price inflation. We have a shortage of home delivery capacity. If stuff doesn't get manufactured for months, we will have a shortage of many other things as well. Obviously we have a lack of demand for other things at the same time. I don't think there is that much unreasonable stockpiling. People are no longer eating out. Kids are no longer eating at school. So people buy more at supermarkets. They also buy for a week, quite sensibly, to avoid making a trip to a crowded supermarket every day. Combine that with finely tuned just in time logistics and you get a bit of a crunch. There's simply a misalignment of capacity right now, but there could be a real shortage of some essentials soon.
  - CSSer 7y ago
    Where did the restaurants and the school get their food from? I know that means a great disruption, but I’m still not convinced that means a shortage.
    - nitrogen 7y ago
      Sysco and the like. It's probably a distribution rather than a supply issue.
      - sokoloff 7y ago
        Exactly. Typical container size in foodservice distribution is a #10 can, packed 6 to a case. Each #10 can is 3 quarts. Fairly few households are interested in buying canned tomatoes 18 quarts at a time.
- seanmcdirmid 7y ago
  VR systems and Nintendo Switch systems are also out of supply, they were bought up quickly when the quarantine started and China hasn’t been making any new ones for a couple of months now.
- 7y ago

mrec 7y ago

> historical US inflation prior to the ridiculous post-2009 financial situation had long periods of being well above 3% and the sky didn't fall True, but misleading; again, it's real rather than nominal rates that matter to most people. Before the GFC you could get interest on savings above the rate of inflation, even after tax. Not spectacular gains, but saving was at least possible. After the GFC your choices are to either a) join the long queue of ever-greater fools piling into the casino, or b) watch central banks confiscate your money, year after year, forever.

thorwasdfasdf 7y ago

i was well aware of the 70s and 80s, that doesn't make it right.

voisin 7y ago

Anyone else have a hard time believing the official inflation numbers? Housing, food, restaurants, electricity, hotels,... anything I can think of that I buy regularly all seems significantly more expensive than it did 10 years ago - much higher than the official numbers would lead me to expect.

meseeks555 7y ago
This is my experience as well ... and healthcare and education costs have also gone up much faster than the stated rate of inflation. There are a few areas --- like consumer electronics and maybe food --- where this isn't the case or prices have actually gone down, but only a very few.