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Lol this is Newyorker. They are poster child fanboy of Bernanke-Yellen-Powell club who brought this mess on to us. This article does not bring up the key issue

Lol this is Newyorker. They are poster child fanboy of Bernanke-Yellen-Powell club who brought this mess on to us. This article does not bring up the key issue that we have had in last 15yrs post GFC - motivation of having endless QE. At some point everyone knew there would be repercussions but everyone looked the other way and was like “trust the fed” or “don’t fight the Fed”. Just kicking the can down the road. Well now Fed has its hands tied. It can’t raise rates too fast or the economy craters. The other option is let the inflation run hot.

frgtpsswrdlame 4y ago
Did you read it? They explicitly do talk about Quantitative Easing following 2008...
- mercy_dude 4y ago
  Yes, where did the mention the culprits- Bernanke/Yellen/Powell. I still can’t fathom why they kept buying bonds even as far out as they did. They could have easily raise the rates in 2011, they didn’t. For example, why did the Fed went out of their way last year calling it transitory?
  - meltyness 4y ago
    Likely due to the doctrine that talking about "a cluster and time period of negative sentiment and contracting investment" is capable of being the impetus for "a cluster and time period of negative sentiment and contracting investment"
- iso1631 4y ago
  The internet believes the main driver of inflation is "money printing" in the US, and nothing to do with the post covid supply squeeze or the current energy crisis The correct solution to avoid being at the wim of such friendly countries as Russia, Saudi, and China would be for Japan, Europe, the US, to massively invest in increasing internal free (renewable) energy sources, and diversifying strategic imports like silicon chips. From 2015-2017 in the US renewable production increased from 558TWh to 710TWh, a 13% increase per year. Staying at that rate for the next 5 years would have put US renewable at 1,300TWh today or 31% - 500TWh more than today, leaving 500TWh of gas and oil to be used elsewhere and reducing the power of Russia and Saudi over the global economy. By 2030 the US would have hit 3,500TWh, up to wards 100% of current electric generation, and by 2040 at the latest to include the extra electric load from things like battery cars. But instead the US didn't.
  - mercy_dude 4y ago
    I am not disagreeing the supply side squeeze but this has been happening since 2020. If you look at container flow stat it is clear as early as 2021 we had severe clogging issues. The problem was the narrative back then from Fed was that this is all transitory. They didn’t act.
    - SkyMarshal 4y ago
      If the problem was a supply side squeeze, the Fed has no mandate or tools for that. They couldn’t act. That’s on the govt and private sector to solve.
      - mercy_dude 4y ago
        That’s not true. You can reduce household demands by raising the rates which is what they are trying to do now. But the challenge is now the inflation has outpaced them and Fed has missed the mark by quite a bit. Heck they are now taking about raising rate by 100 basis point. A year ago this was unthinkable when meme stocks were on the fly. But you can’t raise the rates fast and not cause spiral in for example liquidity or repo market. Point is Fed has done a lot of damage. In a functioning democracy, Fed chair would be summoned by congress and Fed would be held responsible for not keeping its dual mandate - price stability (which inflation is causing wreckage) and unemployment ( from an impending recession). If a Fed agency can’t keep its mandate, it’s time to look at its validity. But of course our elected leaders won’t. They love nothing but delegating to unelected agencies full of so called experts so they don’t have to make hard choices/decisions and bear the consequences from voters. So they just shield themselves with experts.
        SkyMarshal 4y ago
        > That’s not true. You can reduce household demands by raising the rates which is what they are trying to do now. That changes demand, not supply, as you astutely observe. Fed has no tools for supply, by design. That's why they've pushing back on the US govt recently, talking publicly about how current inflation is 30% due to demand (oversupply of money, low interest rates) and 50% due to supply constraints (food, energy, and Asian supply chain slowdowns). They're telling the US govt that solving inflation will require govt and private sector solutions to the supply problems. The Fed has no tools for those.
whoomp12342 4y ago
fed will raise rates. CPI is STILL on an upward trajectory.
bryanlarsen 4y ago
A stopped clock is right twice a day. People have been screaming about QE for 15 years and about government deficits for the last 50. So it seems fairly bloody obvious that the unique things about today's economy are caused by the blindingly obvious unique issues in today's economy like supply shocks rather than the things that are the same as they are when we didn't have problems. The only things that have a strong correlation with recessions are rising interest rates and balanced budgets. So maybe we should stop doing the things that are known to cause recession? Debt is money and that an economy needs money to function. And if an economy is growing, it needs more money, which means either more personal or more corporate or more government borrowing.
- asah 4y ago
  I don't have a problem with debt if it's spent on R&D. But we pay one person to dig ditches and another to fill them, and say "see we created two jobs!" and both guys vote for that politician.
  - SkyMarshal 4y ago
    We don’t really pay one person to dig ditches and another to fill them. Is there something more concrete and real that you’re concerned about?
    - asah 4y ago
      We pay a food company to feed a person calories they don't need so they develop diabetes etc which we pay doctor to cure, insurance company to adjudicate and drug company to medicate. We build roads and buildings and cars designed to require excessive maintenance and then wear out early, e.g. cheap uncoated metals. We develop JavaScript frameworks, rando databases, hipster languages etc and educate/certify people in them, write millions of LOC then replace them a few years later. This is shallow innovation and it's a crazy amount of make-work. There's an alternative, which is to ask whether something EVEN HAS A CHANCE of being relevant in 10 years. Experimentation and risk-taking is fine, hamster-wheeling and "bullshit jobs" are a waste of life and destroy the earth, for little benefit.
Aunche 4y ago
The problem isn't the Fed. The problem is that elected politicians use the majority of their bandwidth to bribe and advertise to voters, and dedicate relatively little time to actually improving the nation in ways that aren't obviously visible. You can't fix the government deficit, poor regulation, or inefficient government spending with exceptional monetary policy.

frgtpsswrdlame 4y ago

Did you read it? They explicitly do talk about Quantitative Easing following 2008...

mercy_dude 4y ago
Yes, where did the mention the culprits- Bernanke/Yellen/Powell. I still can’t fathom why they kept buying bonds even as far out as they did. They could have easily raise the rates in 2011, they didn’t. For example, why did the Fed went out of their way last year calling it transitory?
- meltyness 4y ago
  Likely due to the doctrine that talking about "a cluster and time period of negative sentiment and contracting investment" is capable of being the impetus for "a cluster and time period of negative sentiment and contracting investment"
iso1631 4y ago
The internet believes the main driver of inflation is "money printing" in the US, and nothing to do with the post covid supply squeeze or the current energy crisis The correct solution to avoid being at the wim of such friendly countries as Russia, Saudi, and China would be for Japan, Europe, the US, to massively invest in increasing internal free (renewable) energy sources, and diversifying strategic imports like silicon chips. From 2015-2017 in the US renewable production increased from 558TWh to 710TWh, a 13% increase per year. Staying at that rate for the next 5 years would have put US renewable at 1,300TWh today or 31% - 500TWh more than today, leaving 500TWh of gas and oil to be used elsewhere and reducing the power of Russia and Saudi over the global economy. By 2030 the US would have hit 3,500TWh, up to wards 100% of current electric generation, and by 2040 at the latest to include the extra electric load from things like battery cars. But instead the US didn't.
- mercy_dude 4y ago
  I am not disagreeing the supply side squeeze but this has been happening since 2020. If you look at container flow stat it is clear as early as 2021 we had severe clogging issues. The problem was the narrative back then from Fed was that this is all transitory. They didn’t act.
  - SkyMarshal 4y ago
    If the problem was a supply side squeeze, the Fed has no mandate or tools for that. They couldn’t act. That’s on the govt and private sector to solve.
    - mercy_dude 4y ago
      That’s not true. You can reduce household demands by raising the rates which is what they are trying to do now. But the challenge is now the inflation has outpaced them and Fed has missed the mark by quite a bit. Heck they are now taking about raising rate by 100 basis point. A year ago this was unthinkable when meme stocks were on the fly. But you can’t raise the rates fast and not cause spiral in for example liquidity or repo market. Point is Fed has done a lot of damage. In a functioning democracy, Fed chair would be summoned by congress and Fed would be held responsible for not keeping its dual mandate - price stability (which inflation is causing wreckage) and unemployment ( from an impending recession). If a Fed agency can’t keep its mandate, it’s time to look at its validity. But of course our elected leaders won’t. They love nothing but delegating to unelected agencies full of so called experts so they don’t have to make hard choices/decisions and bear the consequences from voters. So they just shield themselves with experts.
      - SkyMarshal 4y ago
        > That’s not true. You can reduce household demands by raising the rates which is what they are trying to do now. That changes demand, not supply, as you astutely observe. Fed has no tools for supply, by design. That's why they've pushing back on the US govt recently, talking publicly about how current inflation is 30% due to demand (oversupply of money, low interest rates) and 50% due to supply constraints (food, energy, and Asian supply chain slowdowns). They're telling the US govt that solving inflation will require govt and private sector solutions to the supply problems. The Fed has no tools for those.

whoomp12342 4y ago

fed will raise rates. CPI is STILL on an upward trajectory.

bryanlarsen 4y ago

A stopped clock is right twice a day. People have been screaming about QE for 15 years and about government deficits for the last 50. So it seems fairly bloody obvious that the unique things about today's economy are caused by the blindingly obvious unique issues in today's economy like supply shocks rather than the things that are the same as they are when we didn't have problems. The only things that have a strong correlation with recessions are rising interest rates and balanced budgets. So maybe we should stop doing the things that are known to cause recession? Debt is money and that an economy needs money to function. And if an economy is growing, it needs more money, which means either more personal or more corporate or more government borrowing.

asah 4y ago
I don't have a problem with debt if it's spent on R&D. But we pay one person to dig ditches and another to fill them, and say "see we created two jobs!" and both guys vote for that politician.
- SkyMarshal 4y ago
  We don’t really pay one person to dig ditches and another to fill them. Is there something more concrete and real that you’re concerned about?
  - asah 4y ago
    We pay a food company to feed a person calories they don't need so they develop diabetes etc which we pay doctor to cure, insurance company to adjudicate and drug company to medicate. We build roads and buildings and cars designed to require excessive maintenance and then wear out early, e.g. cheap uncoated metals. We develop JavaScript frameworks, rando databases, hipster languages etc and educate/certify people in them, write millions of LOC then replace them a few years later. This is shallow innovation and it's a crazy amount of make-work. There's an alternative, which is to ask whether something EVEN HAS A CHANCE of being relevant in 10 years. Experimentation and risk-taking is fine, hamster-wheeling and "bullshit jobs" are a waste of life and destroy the earth, for little benefit.

Aunche 4y ago

The problem isn't the Fed. The problem is that elected politicians use the majority of their bandwidth to bribe and advertise to voters, and dedicate relatively little time to actually improving the nation in ways that aren't obviously visible. You can't fix the government deficit, poor regulation, or inefficient government spending with exceptional monetary policy.