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Rising food costs. Rising housing costs. Rising unemployment and stagnating wages. Another crash coming in the next couple of years?
by xyst 6y ago
Rising food costs. Rising housing costs. Rising unemployment and stagnating wages.
Another crash coming in the next couple of years?
- dijit 6y agoAre you kidding. There will be an insane recession, if not a depression. Capitalist economies have a short boom bust cycle and a long one. Short ones cause recessions every 10-20 years. Long ones cause depressions every 100~ years. It was clearly stated that Covid (if nothing else) could easily cause a recession, with other factors played in as well then it could easily trigger a depression.
- gambiting 6y agoCan you explain the difference between those, for those of us who are not well versed in economics terms?
- tony0x02 6y agoNot OP, but I recommend watching the "Economic machine" by Dalio.
- Hammershaft 6y agoA recession is an actual economic term, a depression is a cultural term with no economic definition that basically means "a massive terrible recession".
- hedora 6y agoThey differ in magnitude, and (according to some) duration. Roughly speaking, a depression is a loss of more than 10% of economic output: https://www.thoughtco.com/difference-between-a-recession-and-depression-1145900 https://www.thoughtco.com/difference-between-a-recession-and...
- luxuryballs 6y agoThese boom bust cycles are caused by fiat money, inflationary debt/spending, government stimulus and over regulation that causes false market signals and creates bubbles, it’s not a capitalism problem, capitalism would be the solution.
- BostonEnginerd 6y agoWeren’t there a number of long painful recessions in the US during the 1800s - when currency was tied to gold?
- marcosdumay 6y agoYes, and the most accepted theory nowadays is that gold-tied money was a leading cause of the ~10y cycle we saw at the 18th century. As soon as countries adopted fiat money, that one cycle mostly disappeared and even its timing became much more variable. But there are a lot of confounding factors, so this isn't the smoking gun it appears at first.
- deleted 6y ago[deleted]
- gher-shyu3i 6y agoFiat money is the outcome of unfettered capitalism. The government needs money to pay its loans that it took with interest, so what does it do? Detach the currency from anything tangible like gold or other precious metals, then print more money as it desires, devaluing the hard work of people who are trying to save money. There's a reason that interest and usury are prohibited in Islam, Judaism, and Christianity. Market competition is good. Interest and usury are destructive dangerous practices.
- pram 6y agoCurrency debasement is a pretty ancient phenomenon. It’s also not usury.
- 6y ago
- randerson 6y agoDon't forget soaring stock prices too. Sure all feels like inflation to me.
- lottin 6y agoSure, but inflation is not a feeling. It needs to be estimated using a statistical methodology.
- dominotw 6y agoIt is a feeling to ppl who want to start a family, buy a house. Official Inflation doesn't count for those. What else is the word that we can use here?
- lottin 6y agoIn my opinion it's a perceived increase in prices, which may or may not real, and may or may not have to do with inflation.
- dominotw 6y agoNot quite sure what you mean by 'may not real'. Its not possible for most ordinary ppl to even think about buying a house right now. Why isn't this a concern for policy makers.
- lottin 6y agoI mean that the prices need to be measured objectively, because people aren't very good a tracking prices. They may think prices have risen when they have not.
- asdff 6y agoCost of living.
- 6y ago
- PragmaticPulp 6y agoThis article is about food prices in developing nations like Indonesia. It’s not about food costs in countries like the United States. The article mentions that US food prices are inflating at a much more pedestrian 3%: > In the U.S., prices rose close to 3% in the year ending Jan. 2, according to NielsenIQ, roughly double the overall rate of inflation.
- dijit 6y agoI got massively downvoted in my other comment for pointing out that there are boom and bust cycles and that COVID just brought ours closer to one of the larger bust cycles, but in the interest of informing (I wrote that on a phone) I found a link which explains it much better than I could[0]. I highly recommend taking 30 minutes to watch it, the person speaking is a well regarded economist. [0]: https://www.youtube.com/watch?v=PHe0bXAIuk0 https://www.youtube.com/watch?v=PHe0bXAIuk0
- gruez 6y ago>I highly recommend taking 30 minutes to watch it, the person speaking is a well regarded economist. You mean Ray Dalio? Wikipedia says he's a hedge fund manager and has a MBA, but no economics degree.
- vsareto 6y agoHousing has been rising for a long time. Wages have been stagnant for a long time as well. I'm fairly certain food prices won't be the cause here. We printed our way out of a pandemic recession, so who knows what other nuclear options will be used to avoid near-term recessions.