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The US has it easy, since the inflation was largely caused by lockdown stimulus, and also benefits from being the global reserve currency so it can leverage che

The US has it easy, since the inflation was largely caused by lockdown stimulus, and also benefits from being the global reserve currency so it can leverage cheap imports as the interest rate rises increase the value of USD. I wouldn't be surprised if it's better in a few months, especially with the growing protectionism in the anti-inflation act, etc. and acts against Chinese competition, etc. keeping more industry in the US.

phpisthebest 4y ago
There was no Anti-Inflation Act, there was a spending... SPENDING bill they claimed would lower inflation because it also included a very limited amount of deficit reduction which 1 week later they had spent like 3 times on new programs including the Student Loan Cancellation which reversed any inflation reduction the original bill could have had (which was nill in the first place)
- ceejayoz 4y ago
  How did student loan cancellation reverse inflation reduction when it's on hold due to legal challenges? No one has received a penny.
  - koolba 4y ago
    > No one has received a penny. The Biden administration mailed student loan checks to people (conveniently set up to arrive just before the most recent midterm): https://www.foxbusiness.com/personal-finance/student-loan-refund-checks-qualify https://www.foxbusiness.com/personal-finance/student-loan-re... The checks are "rebates" for people who paid their student loans during the moratorium. The idea is to reimburse those people and add back their student loan debt so they can claim the maximum $10K / $20K amount of the forgiveness program. It's hard to argue that's not inflationary.
    - ceejayoz 4y ago
      That's not the student loan cancellation program. Those are people who overpaid during the pause in payments. It's as inflationary as getting a tax refund in April.
      - koolba 4y ago
        > That's not the student loan cancellation program. It’s directly related to the student loan cancellation program as it’s intended to maximize the amount of cancellation for people who paid during the moratorium. > Those are people who overpaid during the pause in payments. It's as inflationary as getting a tax refund in April. It’s not overpayment. It’s just payment because it’s money those people owed on their loans. A payment pause doesn’t mean the money is not owed, it’s simply delayed.
    - soared 4y ago
      No checks were delivered because it’s still going through the courts though, so this likely hasn’t had much of an effect yet. Additionally it’s only for people who paid their loans during the pandemic and have less than $10k in their current loan balance. The check is for whatever amount would return their balance back to $10k.
    - mikem170 4y ago
      I'm not following your point about student loan debt relief impacting the economy. It seems that money has not yet been released yet. From your link [0]: > "If you made voluntary payments during the payment pause (from March 13, 2020, through Dec. 31, 2022) and your current loan balance is below the amount of debt relief you’ll receive, after you successfully apply for and receive debt relief under the administration's debt relief plan, we’ll automatically refund the amount you paid during the payment pause (only up to the remaining amount of your eligible debt relief)," the Office of Federal Student Aid states on its website. > But that plan is currently being challenged in court. A federal appeals court on Oct. 21 issued a temporary block on the student loan forgiveness program as it considers legal challenges raised by six states: Nebraska, Missouri, Arkansas, Iowa, Kansas and South Carolina. I didn't see anything corroborating your statement that checks were mailed out. Maybe I missed something? It's my understanding that the pause in student loan payments was initiated prior to Biden becoming president, along with the trillions of dollars of stimulus given to small business owners and individuals, as alluded to by the top post in this thread. [0] https://www.foxbusiness.com/personal-finance/student-loan-refund-checks-qualify https://www.foxbusiness.com/personal-finance/student-loan-re...
  - thehappypm 4y ago
    People don’t need to make payments, why bother making a payment if its going to get forgiven?
    - ceejayoz 4y ago
      The payment pause on student loans ends in a month and a half (and is a separate program that's been around since the start of the pandemic). The legal battles over the forgiveness program are likely to go far beyond that, and lots of people have loan balances well over the $10k proposed forgiveness.
      - prepend 4y ago
        I’ll be surprised if it actually ends. They said it will super duper definitely end, but there have been many “end dates” over the past two years. I feel silly because I paid off a student loan during this period and if I had paid nothing it would have been forgiven. The rational action is to pay nothing as long as possible.
    - tomcam 4y ago
      I would bother to make my payments because I would feel like shit if I took that much money from the American taxpayer without paying it back.
      - whimsicalism 4y ago
        Why not start donating extra tax to repay any public school expenses you acrued as a child?
        tomcam 4y ago
        That’s bizarre but I’ll assume you don’t know how American public schools are paid for. It’s property tax, which is money the government takes from you when you own a house. Those property taxes were paid annually by definition.
  - Pigalowda 4y ago
    I haven’t been paying anything since non-penalized forbearance started. Why pay when interest is 0% and there’s no penalty for not paying? I’ve been using money that normally goes to loans for other bills. I imagine plenty of other people are buying more stuff with the money so i imagine it does contribute to inflation
    - tomcam 4y ago
      > Why pay when interest is 0% and there’s no penalty for not paying? Just spitballing here… But maybe you should pay because you promised to pay it, the costs were borne by the vast majority of taxpayers who did not take out such loans, and because tradesmen and other perfectly deserving parties do not get access to such easy money?
      - mrtranscendence 4y ago
        > the costs were borne by the vast majority of taxpayers who did not take out such loans The sheer amount of interest I have paid, and will pay, on my student loans makes me think the costs will in fact be borne by me.
        nerdponx 4y ago
        I also pay a great cost when a huge number of other people are stuck paying down debts they probably should never have taken on and/or became bad after the economy shifted and their income potential flattened out. It's not that different from bailing out a bank, except that the banks usually don't deserve the bailout on a moral level, while people with student loans generally do.
      - amscanne 4y ago
        An economic strategy should not depend on people behaving irrationally.
      - bdowling 4y ago
        If the government decided it wants me to receive loan forbearance at 0% interest, then it’s my civic duty to accept it. After all, I don’t want to be labeled some kind of troublemaker.
  - del_del 4y ago
    It seems like a logical consequence of the Permanent Income Hypothesis. If you expect your disposable income to rise by 500$ per month you'll spend more money this month, even though your disposable income hasn't risen yet.
  - whimsicalism 4y ago
    Wealth and income expectations play into current savings. I expect my savings to go up by $20k thanks to this, so I will shift some of my current savings to spending.
    - ceejayoz 4y ago
      > I expect my savings to go up by $20k thanks to this... You rate the risk of SCOTUS rejecting the program at 0%?
      - whimsicalism 4y ago
        No, but I do rate it low. Regardless, it will shift my consumption patterns.
        deleted 4y ago
        [deleted]
- roflyear 4y ago
  I wish the political people would go away from HN. The forum is becoming a rough spot.
  - debacle 4y ago
    Discourse on reddit has eroded from brigading and censorship and so this is the result.
    - roflyear 4y ago
      Yah, I suppose. It isn't like there isn't censorship on HN tho. Probably more extreme than Reddit in a lot of cases.
- Jerrrry 4y ago
  You are correct the anti-inflation act is hot garbage, and accelerated inflation immediately. You are incorrect about the exact specifics about the Direct Student Loan program refunds - anyone who had made payments during the pandemic can be refunded. You are still generally correct though - inflation is caused by several things, M1 and M2 money supply, employment, demand, supply, and sentiment. Everyone not paying their loans decreased demand for jobs, as that was the primary motivator for many to work. Additionally, the money printed and disbursed to colleges not being paid back leads to another increase in money supply, since the money never gets repaid, and a few select loan companies are now holding very large U-O-ME's, which the department of education seemingly is going to average between all of us, by forgiving it, further adding to the printed money pile.
- fundad 4y ago
  raising corporate taxes is anti-inflationary
bt4u 4y ago
dangerwill 4y ago
I too watch/read Peter Zeihan and think he has some insights, but please don't take it all on face value (industry is probably not coming back to the US in force, and shifts from China will be slow and painful)
- mysecretaccount 4y ago
  Zeihan is one of those commentators that seems to throw a bunch of wild predictions at the wall to be entertaining, appear insightful, and be able to say he called it when one of every dozen ends up being correct.
jklinger410 4y ago
> since the inflation was largely caused by lockdown stimulus This is a widely disproved myth.
- Jerrrry 4y ago
  Please explain how literally directly increasing the M1 money supply doesn't cause inflation. Everyone got money for free. Things that are free, tend to have less value.
  - tomcam 4y ago
    And by “free” we mean “added to the gigantic mountain of debt our children must pay off“
    - dlp211 4y ago
      This is not how the national debt works.
      - concordDance 4y ago
        You thinking inflated away or a default? Because those who have bought treasury bills are expecting that money in a few years.
        dlp211 4y ago
        THere is nothing that says that we ever have to pay off the debt. Debt can, and has continued to accrue to this nation since its founding. It is middle school thinking that debt incurred today must be "paid by our children". It's just not at all how the national debt works...like at all.
        tomcam 4y ago
        Yes that middle school thinking is called “arithmetic“
UncleOxidant 4y ago
> I wouldn't be surprised if it's better in a few months, especially with the growing protectionism in the anti-inflation act Wouldn't protectionism be inflationary?
- allemagne 4y ago
  Absolutely. Higher prices for the same goods, plus a stimulus to domestic industry. Unless you are a savvy technocrat who knows where production bottlenecks are better than the market does, protectionism is just a welfare program at best and a cynical rent-seeking, vote-buying scheme at worst.

phpisthebest 4y ago

There was no Anti-Inflation Act, there was a spending... SPENDING bill they claimed would lower inflation because it also included a very limited amount of deficit reduction which 1 week later they had spent like 3 times on new programs including the Student Loan Cancellation which reversed any inflation reduction the original bill could have had (which was nill in the first place)

ceejayoz 4y ago
How did student loan cancellation reverse inflation reduction when it's on hold due to legal challenges? No one has received a penny.
- koolba 4y ago
  > No one has received a penny. The Biden administration mailed student loan checks to people (conveniently set up to arrive just before the most recent midterm): https://www.foxbusiness.com/personal-finance/student-loan-refund-checks-qualify https://www.foxbusiness.com/personal-finance/student-loan-re... The checks are "rebates" for people who paid their student loans during the moratorium. The idea is to reimburse those people and add back their student loan debt so they can claim the maximum $10K / $20K amount of the forgiveness program. It's hard to argue that's not inflationary.
  - ceejayoz 4y ago
    That's not the student loan cancellation program. Those are people who overpaid during the pause in payments. It's as inflationary as getting a tax refund in April.
    - koolba 4y ago
      > That's not the student loan cancellation program. It’s directly related to the student loan cancellation program as it’s intended to maximize the amount of cancellation for people who paid during the moratorium. > Those are people who overpaid during the pause in payments. It's as inflationary as getting a tax refund in April. It’s not overpayment. It’s just payment because it’s money those people owed on their loans. A payment pause doesn’t mean the money is not owed, it’s simply delayed.
  - soared 4y ago
    No checks were delivered because it’s still going through the courts though, so this likely hasn’t had much of an effect yet. Additionally it’s only for people who paid their loans during the pandemic and have less than $10k in their current loan balance. The check is for whatever amount would return their balance back to $10k.
  - mikem170 4y ago
    I'm not following your point about student loan debt relief impacting the economy. It seems that money has not yet been released yet. From your link [0]: > "If you made voluntary payments during the payment pause (from March 13, 2020, through Dec. 31, 2022) and your current loan balance is below the amount of debt relief you’ll receive, after you successfully apply for and receive debt relief under the administration's debt relief plan, we’ll automatically refund the amount you paid during the payment pause (only up to the remaining amount of your eligible debt relief)," the Office of Federal Student Aid states on its website. > But that plan is currently being challenged in court. A federal appeals court on Oct. 21 issued a temporary block on the student loan forgiveness program as it considers legal challenges raised by six states: Nebraska, Missouri, Arkansas, Iowa, Kansas and South Carolina. I didn't see anything corroborating your statement that checks were mailed out. Maybe I missed something? It's my understanding that the pause in student loan payments was initiated prior to Biden becoming president, along with the trillions of dollars of stimulus given to small business owners and individuals, as alluded to by the top post in this thread. [0] https://www.foxbusiness.com/personal-finance/student-loan-refund-checks-qualify https://www.foxbusiness.com/personal-finance/student-loan-re...
- thehappypm 4y ago
  People don’t need to make payments, why bother making a payment if its going to get forgiven?
  - ceejayoz 4y ago
    The payment pause on student loans ends in a month and a half (and is a separate program that's been around since the start of the pandemic). The legal battles over the forgiveness program are likely to go far beyond that, and lots of people have loan balances well over the $10k proposed forgiveness.
    - prepend 4y ago
      I’ll be surprised if it actually ends. They said it will super duper definitely end, but there have been many “end dates” over the past two years. I feel silly because I paid off a student loan during this period and if I had paid nothing it would have been forgiven. The rational action is to pay nothing as long as possible.
  - tomcam 4y ago
    I would bother to make my payments because I would feel like shit if I took that much money from the American taxpayer without paying it back.
    - whimsicalism 4y ago
      Why not start donating extra tax to repay any public school expenses you acrued as a child?
      - tomcam 4y ago
        That’s bizarre but I’ll assume you don’t know how American public schools are paid for. It’s property tax, which is money the government takes from you when you own a house. Those property taxes were paid annually by definition.
- Pigalowda 4y ago
  I haven’t been paying anything since non-penalized forbearance started. Why pay when interest is 0% and there’s no penalty for not paying? I’ve been using money that normally goes to loans for other bills. I imagine plenty of other people are buying more stuff with the money so i imagine it does contribute to inflation
  - tomcam 4y ago
    > Why pay when interest is 0% and there’s no penalty for not paying? Just spitballing here… But maybe you should pay because you promised to pay it, the costs were borne by the vast majority of taxpayers who did not take out such loans, and because tradesmen and other perfectly deserving parties do not get access to such easy money?
    - mrtranscendence 4y ago
      > the costs were borne by the vast majority of taxpayers who did not take out such loans The sheer amount of interest I have paid, and will pay, on my student loans makes me think the costs will in fact be borne by me.
      - nerdponx 4y ago
        I also pay a great cost when a huge number of other people are stuck paying down debts they probably should never have taken on and/or became bad after the economy shifted and their income potential flattened out. It's not that different from bailing out a bank, except that the banks usually don't deserve the bailout on a moral level, while people with student loans generally do.
    - amscanne 4y ago
      An economic strategy should not depend on people behaving irrationally.
    - bdowling 4y ago
      If the government decided it wants me to receive loan forbearance at 0% interest, then it’s my civic duty to accept it. After all, I don’t want to be labeled some kind of troublemaker.
- del_del 4y ago
  It seems like a logical consequence of the Permanent Income Hypothesis. If you expect your disposable income to rise by 500$ per month you'll spend more money this month, even though your disposable income hasn't risen yet.
- whimsicalism 4y ago
  Wealth and income expectations play into current savings. I expect my savings to go up by $20k thanks to this, so I will shift some of my current savings to spending.
  - ceejayoz 4y ago
    > I expect my savings to go up by $20k thanks to this... You rate the risk of SCOTUS rejecting the program at 0%?
    - whimsicalism 4y ago
      No, but I do rate it low. Regardless, it will shift my consumption patterns.
      - deleted 4y ago
        [deleted]
roflyear 4y ago
I wish the political people would go away from HN. The forum is becoming a rough spot.
- debacle 4y ago
  Discourse on reddit has eroded from brigading and censorship and so this is the result.
  - roflyear 4y ago
    Yah, I suppose. It isn't like there isn't censorship on HN tho. Probably more extreme than Reddit in a lot of cases.
Jerrrry 4y ago
You are correct the anti-inflation act is hot garbage, and accelerated inflation immediately. You are incorrect about the exact specifics about the Direct Student Loan program refunds - anyone who had made payments during the pandemic can be refunded. You are still generally correct though - inflation is caused by several things, M1 and M2 money supply, employment, demand, supply, and sentiment. Everyone not paying their loans decreased demand for jobs, as that was the primary motivator for many to work. Additionally, the money printed and disbursed to colleges not being paid back leads to another increase in money supply, since the money never gets repaid, and a few select loan companies are now holding very large U-O-ME's, which the department of education seemingly is going to average between all of us, by forgiving it, further adding to the printed money pile.
fundad 4y ago
raising corporate taxes is anti-inflationary

bt4u 4y ago

dangerwill 4y ago

I too watch/read Peter Zeihan and think he has some insights, but please don't take it all on face value (industry is probably not coming back to the US in force, and shifts from China will be slow and painful)

mysecretaccount 4y ago
Zeihan is one of those commentators that seems to throw a bunch of wild predictions at the wall to be entertaining, appear insightful, and be able to say he called it when one of every dozen ends up being correct.

jklinger410 4y ago

> since the inflation was largely caused by lockdown stimulus This is a widely disproved myth.

Jerrrry 4y ago
Please explain how literally directly increasing the M1 money supply doesn't cause inflation. Everyone got money for free. Things that are free, tend to have less value.
- tomcam 4y ago
  And by “free” we mean “added to the gigantic mountain of debt our children must pay off“
  - dlp211 4y ago
    This is not how the national debt works.
    - concordDance 4y ago
      You thinking inflated away or a default? Because those who have bought treasury bills are expecting that money in a few years.
      - dlp211 4y ago
        THere is nothing that says that we ever have to pay off the debt. Debt can, and has continued to accrue to this nation since its founding. It is middle school thinking that debt incurred today must be "paid by our children". It's just not at all how the national debt works...like at all.
        tomcam 4y ago
        Yes that middle school thinking is called “arithmetic“

UncleOxidant 4y ago

> I wouldn't be surprised if it's better in a few months, especially with the growing protectionism in the anti-inflation act Wouldn't protectionism be inflationary?

allemagne 4y ago
Absolutely. Higher prices for the same goods, plus a stimulus to domestic industry. Unless you are a savvy technocrat who knows where production bottlenecks are better than the market does, protectionism is just a welfare program at best and a cynical rent-seeking, vote-buying scheme at worst.