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The walrus being a far-left MMT proposing place wrote this when inflation was at 3.5% or so. It's now much higher and very evidently out of control. The articl

The walrus being a far-left MMT proposing place wrote this when inflation was at 3.5% or so. It's now much higher and very evidently out of control. The article quotes Mark Carney, as if he were on their side. BoE under Carney have raised interest rates twice: https://tradingeconomics.com/united-kingdom/interest-rate https://tradingeconomics.com/united-kingdom/interest-rate and that hasn't even dented inflation. https://tradingeconomics.com/united-kingdom/inflation-cpi https://tradingeconomics.com/united-kingdom/inflation-cpi I believe Carney has a speech tonight which most likely will touch on inflation and interest rates. Guess we'll see. MMT and UBI as political subjects have been utterly dead since the time this article was written. What a disaster of an article.

bryanlarsen 5y ago
> It's now much higher and very evidently out of control. Monthly inflation is slowing, and is at an annualized 4.8%. We had a big spike in the summer/fall that's still showing up in our annual figures, but inflation itself is coming under control. https://news.ycombinator.com/item?id=30289147 https://news.ycombinator.com/item?id=30289147
- overtonwhy 5y ago
  Yeah but they're a brand new user who is claiming that everything is terrible!
- nostrademons 5y ago
  0.6% monthly inflation annualized isn't 4.8%. Not really sure how you got 4.8%, but the computation you want is 1.006^12 = 1.0744, about 7.4% (which also happens to match the annualized figures).
  - bryanlarsen 5y ago
    A year has 8 months, doesn't it?
- e4e78a06 5y ago
  Coincidentally government transfer payments funded by deficit spending reached a new low for the year [1]. I'd also add CPI underestimates true inflation because it uses hedonic adjustments, but in real life consumers don't keep buying crappier and crappier products. If you use 1980 methodology for computing CPI it's around 15% annualized now [2]. [1]: https://www.wsj.com/articles/u-s-government-recorded-119-billion-budget-surplus-its-first-since-before-pandemic-11644519768 https://www.wsj.com/articles/u-s-government-recorded-119-bil... [2]: http://www.shadowstats.com/alternate_data/inflation-charts http://www.shadowstats.com/alternate_data/inflation-charts
- sleepingadmin 5y ago
  >Monthly inflation is slowing, and is at an annualized 4.8%. We had a big spike in the summer/fall that's still showing up in our annual figures, but inflation itself is coming under control. https://tradingeconomics.com/united-states/inflation-rate-mom https://tradingeconomics.com/united-states/inflation-rate-mo... Maybe that would have been believable in August. No way I can look at that graph and say it's slowing. https://tradingeconomics.com/united-states/inflation-cpi https://tradingeconomics.com/united-states/inflation-cpi That's a gigantic 7.5%. A butt puckering 7.5%.
imtringued 5y ago
Inflation is never out of control, the only thing that is out of control is our desire to deny reality. You can stop inflation at any point with a negative interest rate. The moment you do that you can start increasing reserve requirements, if you are ambitious you can go all the way to 100%.
- missedthecue 5y ago
  Lower interest rates decreases inflation? Can you explain the mechanics behind that? If interest rates went negative, I would literally borrow and spend and much money as I could.
  - bubbleRefuge 5y ago
    MMT 101. The federal government is a net payer of Interest to the private sector. Thus, when interest rates are increased, Interest income to the private sector increases. Interest paid by the US treasury to the private sector is kind of printing money. When interest rates go down, interest income to the private sector decreases.
    - missedthecue 5y ago
      The total amount of interest paid by the government to all parties, domestic, foreign, private, and public sector was about $400 billion in 2021. Meanwhile, America borrowed $1 trillion in new debt in the same year. Lower rates contribute to a higher money supply far more than raising interest rates adds to the interest income paid to the private sector.
      - bubbleRefuge 5y ago
        When considering non-government sector burrowing due to lower interest rates, these transactions net to zero for the private sector, because an asset and a liability is created to the private sector. In the case of government paying interest to the private sector, the private sector balance sheet nets positive.
      - 5y ago
neilwilson 5y ago
"It's now much higher and very evidently out of control." Only to those that fixate on changing prices as though they should never happen and are a mortal sin. In reality price is just the market allocating scarce resources to those who can make better use of them. There's no magic here. We're making less stuff because people have thrown sand in the works due to bureaucratic government restrictions. So who gets to lose out? We can do it by price, or we can do it by quantity. Pick one. The "inflation out of control" rhetoric is just PR cover for throwing a lot of people out of work, but trying to get the central bank to do the dirty work, rather than the more awkward job of raising taxes and/or cutting government spending. Which, funnily enough, is precisely what MMT says on the subject. "Inflation is the process whereby the government causes higher prices by creating more money either directly through deficit spending, or indirectly by lowering interest rates or otherwise encouraging borrowing. For example, when a shortage of goods and services causes higher prices, a government may attempt to help its constituents to buy more by giving them more money. Of course, a shortage means that the desired products don't exist. More money just raises the price. When that, in turn, causes the government to further increase the money available, an inflationary spiral has been created The institutionalisation of this process is called indexing" Soft Currency Economics, Warren Mosler, p71 When you start critiquing MMT, always best to understand the source material first, rather then getting your view from Twitter et al. They don't understand what MMT is saying either.
- sleepingadmin 5y ago
  >Only to those that fixate on changing prices as though they should never happen and are a mortal sin. Inflation is a requirement of a healthy economy. How much is important to debate and should be politically an option to tinker with. Though I suspect many would be afraid to touch it. MMT politicians are more than welcome to jump into the seat if they garner enough support from democracy. >When you start critiquing MMT, always best to understand the source material first, rather then getting your view from Twitter et al. They don't understand what MMT is saying either. There's also a reason why MMT died a horrible death in the last several months. The Twitter critiques were right. In fact I will go so far as to say they were MORE THAN right. The predictions they made that make MMT look bad were under predicted. MMT reality is so much worse.

bryanlarsen 5y ago

> It's now much higher and very evidently out of control. Monthly inflation is slowing, and is at an annualized 4.8%. We had a big spike in the summer/fall that's still showing up in our annual figures, but inflation itself is coming under control. https://news.ycombinator.com/item?id=30289147 https://news.ycombinator.com/item?id=30289147

overtonwhy 5y ago
Yeah but they're a brand new user who is claiming that everything is terrible!
nostrademons 5y ago
0.6% monthly inflation annualized isn't 4.8%. Not really sure how you got 4.8%, but the computation you want is 1.006^12 = 1.0744, about 7.4% (which also happens to match the annualized figures).
- bryanlarsen 5y ago
  A year has 8 months, doesn't it?
e4e78a06 5y ago
Coincidentally government transfer payments funded by deficit spending reached a new low for the year [1]. I'd also add CPI underestimates true inflation because it uses hedonic adjustments, but in real life consumers don't keep buying crappier and crappier products. If you use 1980 methodology for computing CPI it's around 15% annualized now [2]. [1]: https://www.wsj.com/articles/u-s-government-recorded-119-billion-budget-surplus-its-first-since-before-pandemic-11644519768 https://www.wsj.com/articles/u-s-government-recorded-119-bil... [2]: http://www.shadowstats.com/alternate_data/inflation-charts http://www.shadowstats.com/alternate_data/inflation-charts
sleepingadmin 5y ago
>Monthly inflation is slowing, and is at an annualized 4.8%. We had a big spike in the summer/fall that's still showing up in our annual figures, but inflation itself is coming under control. https://tradingeconomics.com/united-states/inflation-rate-mom https://tradingeconomics.com/united-states/inflation-rate-mo... Maybe that would have been believable in August. No way I can look at that graph and say it's slowing. https://tradingeconomics.com/united-states/inflation-cpi https://tradingeconomics.com/united-states/inflation-cpi That's a gigantic 7.5%. A butt puckering 7.5%.

imtringued 5y ago

Inflation is never out of control, the only thing that is out of control is our desire to deny reality. You can stop inflation at any point with a negative interest rate. The moment you do that you can start increasing reserve requirements, if you are ambitious you can go all the way to 100%.

missedthecue 5y ago
Lower interest rates decreases inflation? Can you explain the mechanics behind that? If interest rates went negative, I would literally borrow and spend and much money as I could.
- bubbleRefuge 5y ago
  MMT 101. The federal government is a net payer of Interest to the private sector. Thus, when interest rates are increased, Interest income to the private sector increases. Interest paid by the US treasury to the private sector is kind of printing money. When interest rates go down, interest income to the private sector decreases.
  - missedthecue 5y ago
    The total amount of interest paid by the government to all parties, domestic, foreign, private, and public sector was about $400 billion in 2021. Meanwhile, America borrowed $1 trillion in new debt in the same year. Lower rates contribute to a higher money supply far more than raising interest rates adds to the interest income paid to the private sector.
    - bubbleRefuge 5y ago
      When considering non-government sector burrowing due to lower interest rates, these transactions net to zero for the private sector, because an asset and a liability is created to the private sector. In the case of government paying interest to the private sector, the private sector balance sheet nets positive.
    - 5y ago

neilwilson 5y ago

"It's now much higher and very evidently out of control." Only to those that fixate on changing prices as though they should never happen and are a mortal sin. In reality price is just the market allocating scarce resources to those who can make better use of them. There's no magic here. We're making less stuff because people have thrown sand in the works due to bureaucratic government restrictions. So who gets to lose out? We can do it by price, or we can do it by quantity. Pick one. The "inflation out of control" rhetoric is just PR cover for throwing a lot of people out of work, but trying to get the central bank to do the dirty work, rather than the more awkward job of raising taxes and/or cutting government spending. Which, funnily enough, is precisely what MMT says on the subject. "Inflation is the process whereby the government causes higher prices by creating more money either directly through deficit spending, or indirectly by lowering interest rates or otherwise encouraging borrowing. For example, when a shortage of goods and services causes higher prices, a government may attempt to help its constituents to buy more by giving them more money. Of course, a shortage means that the desired products don't exist. More money just raises the price. When that, in turn, causes the government to further increase the money available, an inflationary spiral has been created The institutionalisation of this process is called indexing" Soft Currency Economics, Warren Mosler, p71 When you start critiquing MMT, always best to understand the source material first, rather then getting your view from Twitter et al. They don't understand what MMT is saying either.

sleepingadmin 5y ago
>Only to those that fixate on changing prices as though they should never happen and are a mortal sin. Inflation is a requirement of a healthy economy. How much is important to debate and should be politically an option to tinker with. Though I suspect many would be afraid to touch it. MMT politicians are more than welcome to jump into the seat if they garner enough support from democracy. >When you start critiquing MMT, always best to understand the source material first, rather then getting your view from Twitter et al. They don't understand what MMT is saying either. There's also a reason why MMT died a horrible death in the last several months. The Twitter critiques were right. In fact I will go so far as to say they were MORE THAN right. The predictions they made that make MMT look bad were under predicted. MMT reality is so much worse.