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Economics & Trade

ConnorEl said:
Y’all don’t think the fed should be trying to control inflation? Or that inflation doesn’t hurt people?
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Who are you ok with suffering to get control over inflation? Do you think there is a risk you’ll be out of a job?
 
They shoulda done something about inflation a decade ago. Housing prices have been going up 10% a year for the past decade solely because of the fed
 
bym051d said:
Who are you ok with suffering to get control over inflation? Do you think there is a risk you’ll be out of a job?
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The question is should the Fed be raising interest rates to combat inflation? Or what should rather be done if not?
 
ConnorEl said:
The question is should the Fed be raising interest rates to combat inflation? Or what should rather be done if not?
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its easy to look at the problem coldly if you know the solution can’t negatively affect you.

id like to know what other options exist that won’t hurt average people before we try to crash the economy.
 
It’s cold to acknowledge that inflation hurts people….?

What should be done?
 
For example, the rapid rate increases have priced people out of the housing market, therefore increasing demand on rentals and causing inflation in the rental market.
 
Connor, “inflation” isn’t just costs going up. Inflation is some costs going up while others stay the same. Fighting inflation by fighting spending is ridiculous if the rising costs are for necessities like food and shelter and if they’re due to supply side issues.
 
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I'm just glad that the threat of Trump winning got Biden do do something about those gas prices.
 
Sooo….what should be done policy wise, if anything, to attempt to mitigate recent inflation trends?

What, specifically, should the fed be doing?

My inexpert sense is it’s appropriate to raise interest rates…as has been done…but maybe it’s now time to pause the raises…??
 
Why should the fed raise interest rates? Because that’s all they can do?
 
To cool a too hot economy and inflation.

What should be the fed rate? Should it ever change? And why?
 
ConnorEl said:
To cool a too hot economy and inflation.

What should be the fed rate? Should it ever change? And why?
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You’re treating the economy and inflation like they’re each one thing that work by pulling a lever.
 
We shouldn’t be raising rates to the point every other countries currency drops 20%. Inflation is largely caused by the covid supply shocks and the ridiculous government stimulus due to covid.

Neither of which hiking rates to oblivion will fix.

It’s not like without the fed we were going to be paying 6 figures for a Toyota Camry. Most of the inflation is already in the rear view
 
ConnorEl said:
So no one has any answers.

OK.
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You've defined the questions as a "hot economy" and "inflation." OK. You may think that's meaningful, but it's not. Theyr'e just economic shorthand at best. At worst, they're lazy buzzwords economists use to obscure problems so they can be trusted to develop solutions.

Let me give you some new questions we can answer.

If something is hot, is the heat causing damage? If so, what is the source of the heat? Do we need to cool the source down or can we get rid of it?

If something is inflating, what is the source of the inflation? Do we need to pop it or should we deflate it?

Answer those questions and then we can get into how to address them.
 
I found a very informative article on the global impact of the US FED raising interest rates, particularly how it affects smaller countries. I am not familiar enough with global finance to read any political bias from the article, but if anyone else does, please let me know what you think -

How the Fed's rate hikes may cause financial crisis in low-income countries | Fortune

Monetary policy decisions in the U.S. have a ripple effect in low-income countries.
fortune.com
 
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