2 ms·
But arguably one solution - slowing the increase in the money supply - will fix all 4 of them. This isn't like a fire that needs fuel and air to keep going and
by hackeraccount 5y ago
But arguably one solution - slowing the increase in the money supply - will fix all 4 of them. This isn't like a fire that needs fuel and air to keep going and stopping it can be done by taking either away; One of the two items is technically trivial (raise interest rates) and politically unpopular to do - the other is politically popular and technically challenging (fix supply issues).
If history is any guide we'll try the politically easy one for 10 or 20 years before we finally get around to actually doing what will work.
- bryanlarsen 5y agoRaising the interest rates increases the unemployment rate and 9/10 times causes a recession. That's cutting off your nose to support your face.
- hackeraccount 5y agoAbsolutely. If the attitude of people were - 7% inflation? No problem, let's just not have an increase in unemployment or a recession then I'd at least be sympathetic. Instead people say "I can whip inflation without raising rates, increasing unemployment or causing a recession." What do you get? A recession. Rising unemployment. And inflation too.