Disgusted with the Biden administration

posted by gut

Yeah, what the Fed has done effectively to tame inflation for 40 years - raise interest rates!

Which will go over like a lead balloon with Biden, obviously.

I certainly don't think prior Fed's would have sat on their thumbs just assuming inflation was temporary.  They would have raised rates, and then if inflation fell off a cliff they'd start cutting rates again.  No big deal.  I believe Greenspan thinks once of the greatest mistakes of his career was waiting too long to raise rates.  IMO, Yellen is almost guilty of malpractice here.

Raising interest rates aren't gonna solve a supply problem though. That's why we're seeing rapid inflation of products. 

posted by gut

Also, when you have supply chain shortages combined with labor shortages....seems like the WRONG time to "create millions of new jobs" with gubmit porkulus.

But, really, super bang-up job guys giving the world's richest man another billions handouts to help him sell more Teslas.

No you're right, it's not gonna help. but there's nothing he can do that will help. It's gonna have to work itself out.

posted by kizer permanente

Raising interest rates aren't gonna solve a supply problem though. That's why we're seeing rapid inflation of products. 

Actually, that's exactly what raising rates does.  Inflation is always a result of demand outpacing supply.  When you put the brakes on growth, you're also putting the brakes on demand.

It also further works on the demand side by reducing consumption because higher rates raises the return on savings.

posted by gut

Actually, that's exactly what raising rates does.  Inflation is always a result of demand outpacing supply.  When you put the brakes on growth, you're also putting the brakes on demand.

It also further works on the demand side by reducing consumption because higher rates raises the return on savings.

But it's a labor shortage causing the supply issues. That doesn't get fixed by raising interest rates. It's affecting literally everything, including necessities. People can't and won't stop purchasing necessities.  Only thing raising interest rates will do is help certain segments of industries. It's not gonna solve the a global labor shortage to get products to people

posted by kizer permanente

But it's a labor shortage causing the supply issues. That doesn't get fixed by raising interest rates.

The Fed doesn't get too concerned with the source of inflation.  For 40 years, they've kept inflation in check targeting two simple numbers: unemployment and CPI.

The labor shortage is driving prices higher.  This is all Econ 101.  And the answer to wage inflation is to raise interest rates. 

Pouring gasoline on an already tight labor market by printing trillions is the absolute worst thing we could be doing for inflation.

posted by gut

The Fed doesn't get too concerned with the source of inflation.  For 40 years, they've kept inflation in check targeting two simple numbers: unemployment and CPI.

The labor shortage is driving prices higher.  This is all Econ 101.  And the answer to wage inflation is to raise interest rates. 

Pouring gasoline on an already tight labor market by printing trillions is the absolute worst thing we could be doing for inflation.

That’s fine for typical times. We’re not in typical times. Theres still going to be a supply shortage because of a labor shortage and hence there will be inflation on products. You can raise interest rates. It’s not gonna help the labor shortage. There’s still gonna be inflation. Maybe not as much because it will curb some spending. But there still will be inflation..

posted by kizer permanente

But it's a labor shortage causing the supply issues. That doesn't get fixed by raising interest rates. It's affecting literally everything, including necessities. People can't and won't stop purchasing necessities.  Only thing raising interest rates will do is help certain segments of industries. It's not gonna solve the a global labor shortage to get products to people

With a labor shortage would you agree that the last thing you do is create mandates that will force 10-20% out of their jobs?

posted by kizer permanente

That’s fine for typical times. We’re not in typical times. Theres still going to be a supply shortage because of a labor shortage and hence there will be inflation on products. You can raise interest rates. It’s not gonna help the labor shortage. There’s still gonna be inflation. Maybe not as much because it will curb some spending. But there still will be inflation..

Actually, I hadn't looked at the data until you (and Biden) brought it up today. 

Demand IS UP.  There are still plenty of shortages, somewhat sporadically.  But global GDP went down, 3.3% I think in 2020, and projected to finish up 6% this year.  So demand is peaking at new levels throughout much of the world.  I think the mistake is assuming this is a supply shock, but actually it looks very much like a typical demand shock (which is to be expected coming out of what we came out of).

And Biden's energy policy is contributing to higher oil and gas prices.  And that drives higher food prices, as well.  And the porkulus has some 2M people still temporarily on "hiatus".

So, for starters, Biden can STOP pouring gas on all this.  He's done a lot to contribute, so clearly there are things he can do to fix it.

Again, "labor shortage" is really just code for demand exceeding supply.  And that is prototypical of every time you see wages start to rise.  The labor shortage is driven by growth - to fix the labor shortage, you tap the brakes on growth.  That's how it's worked for 40 years, and will continue to work.

posted by jmog

With a labor shortage would you agree that the last thing you do is create mandates that will force 10-20% out of their jobs?

Nothing Biden can do.  Move along.

But seems some economists are worried that tapping the brakes is going to overshoot....because they believe the global economy is slowing.  I'm not sure I'm buying that, because projected growth the next two years is at or above 2017/2018 levels when they were starting to raise interest rates because growth and inflation were heating up.

I'm also concerned this is a repeat of 2008, heck maybe even the internet bubble.  In both cases, central banks were too slow to raise rates when the economy was starting to flash warning signals.  To her credit, maybe, Yellen did say recently they are not going to sit on their thumb.  But it sure looks that way, and a lot of people are starting to say this inflation doesn't look transitory.

Maybe the truth is much uglier: OECD countries racked up a shit ton of debt the past 13 years, and they can't afford to go back to a normative interest rate environment.

The US and every other country just papered over a depression.  Corrections are vital to taking out the trash and maintaining a healthy economy - there is a steep price yet to be paid.

And we're going to print another $250B per year when the larger infrasugar package passes?

We're just dumping a ton of inflationary pressure on an already fragile economy.  Nothing Biden can do, except make it worse apparently.  If only all the gaslighting could heat people's homes!

posted by gut

The US and every other country just papered over a depression.  Corrections are vital to taking out the trash and maintaining a healthy economy - there is a steep price yet to be paid.

And we're going to print another $250B per year when the larger infrasugar package passes?

We're just dumping a ton of inflationary pressure on an already fragile economy.  Nothing Biden can do, except make it worse apparently.  If only all the gaslighting could heat people's homes!

Where is boatshoes to counter your posts?  I am not sure if he would be fingering himself to the 2021 porkulus, or upset that it wasn't enough. 

posted by kizer permanente

I don't know what you do about it? Do you? It's going to have to adjust back to normal.  If there ever is such a thing anymore. 2020 was pure chaos as far as a global market was concerned. We had panic buying followed by no buying followed but months of no manufacturing leading to inventory depleting's that were already next to nil since that was determined how you make the most money and are the most efficient. And now we want to buy again like like none of that ever happened. I dunno.. I don't have the answer I guess.

We would only be so forutnate if the Government did nothing for the last 20 years. 

posted by jmog

With a labor shortage would you agree that the last thing you do is create mandates that will force 10-20% out of their jobs?

Much like NYP claiming tens of thousands of New York police would quit…. That’s overly exaggerated. There’s absolutely 0% chance 10-20% of our population could afford to just give up their job. Less than that have even enough savings to cover their expenses for 3 months. 

posted by gut

Actually, I hadn't looked at the data until you (and Biden) brought it up today. 

Demand IS UP.  There are still plenty of shortages, somewhat sporadically.  But global GDP went down, 3.3% I think in 2020, and projected to finish up 6% this year.  So demand is peaking at new levels throughout much of the world.  I think the mistake is assuming this is a supply shock, but actually it looks very much like a typical demand shock (which is to be expected coming out of what we came out of).

And Biden's energy policy is contributing to higher oil and gas prices.  And that drives higher food prices, as well.  And the porkulus has some 2M people still temporarily on "hiatus".

So, for starters, Biden can STOP pouring gas on all this.  He's done a lot to contribute, so clearly there are things he can do to fix it.

Again, "labor shortage" is really just code for demand exceeding supply.  And that is prototypical of every time you see wages start to rise.  The labor shortage is driven by growth - to fix the labor shortage, you tap the brakes on growth.  That's how it's worked for 40 years, and will continue to work.

It's possible. I honestly have no clue. I know I've never seen anything like this before. Everyone has long lead times on everything. Our company is paying its own salary employees extra to travel to different locations to work production to try to catch up. Our company's employment total is down 18% from 2019. Every plant we have in India is idled and 1 is at half capacity due to their mandates. Hell even our US plants were back to work before our Chinese plants were. But US plants are still understaffed. Mexico is our only plant running close to full capacity and its down I think 7% last I heard from 2019. Sales are still up from previous quarters like it always is albeit not as much as usual. but a lot of that is due to we cant get it out the door and we cant get raws from Asia to even complete work we do have. If we don't have a labor shortage then this is very unique to just us I guess. 

posted by kizer permanente

Yeah.. amazing.  So what actions should he take that will fix this global supply chain issue?

Basically undo pretty much every action that has been taken. Of course, that would be admitting error and can never happen.

posted by queencitybuckeye

Basically undo pretty much every action that has been taken. Of course, that would be admitting error and can never happen.

Specifically what though? What have they done that's created this labor crisis GLOBALLY? What can they possibly do to fix it? Do you think it's gonna get better anytime soon? Honestly, I'd like to know if you think that. We still have people on this very thread saying covid is dumb and we need to go back to normal, like its really an option. Nearly half our population wont get vaccinated no matter what you do. This thing ain't dying out like past flu pandemics. Instead we wanna bitch about some people may quit if there's a mandate. We cant even keep people healthy enough to work as it is. The fuck a mandate gonna matter if some people quit? Those people who would quit over a mandate are the least of our problems.

posted by kizer permanente

Specifically what though? What have they done that's created this labor crisis GLOBALLY? What can they possibly do to fix it? Do you think it's gonna get better anytime soon? Honestly, I'd like to know if you think that. We still have people on this very thread saying covid is dumb and we need to go back to normal, like its really an option. Nearly half our population wont get vaccinated no matter what you do. This thing ain't dying out like past flu pandemics. Instead we wanna bitch about some people may quit if there's a mandate. We cant even keep people healthy enough to work as it is. The fuck a mandate gonna matter if some people quit? Those people who would quit over a mandate are the least of our problems.

Why do you believe a global crisis has a global cause?

posted by queencitybuckeye

Why do you believe a global crisis has a global cause?

I think the cause is pretty evident unless you've been in a coma since 2019?

posted by gut

Actually, I hadn't looked at the data until you (and Biden) brought it up today. 

Demand IS UP.  There are still plenty of shortages, somewhat sporadically.  But global GDP went down, 3.3% I think in 2020, and projected to finish up 6% this year.  So demand is peaking at new levels throughout much of the world.  I think the mistake is assuming this is a supply shock, but actually it looks very much like a typical demand shock (which is to be expected coming out of what we came out of).

And Biden's energy policy is contributing to higher oil and gas prices.  And that drives higher food prices, as well.  And the porkulus has some 2M people still temporarily on "hiatus".

So, for starters, Biden can STOP pouring gas on all this.  He's done a lot to contribute, so clearly there are things he can do to fix it.

Again, "labor shortage" is really just code for demand exceeding supply.  And that is prototypical of every time you see wages start to rise.  The labor shortage is driven by growth - to fix the labor shortage, you tap the brakes on growth.  That's how it's worked for 40 years, and will continue to work.

I agree with this.  I read somewhere where most ports are moving more ships through than anytime in history.   I also have been reading where companies actually arent in a rush to fix the "labor shortage"  because they are actaully getting more $ for their product.  They have little incentive to raise wages to produce more product and therefore lowering the price.

posted by kizer permanente

Specifically what though? What have they done that's created this labor crisis GLOBALLY? What can they possibly do to fix it? Do you think it's gonna get better anytime soon? Honestly, I'd like to know if you think that. We still have people on this very thread saying covid is dumb and we need to go back to normal, like its really an option. Nearly half our population wont get vaccinated no matter what you do. This thing ain't dying out like past flu pandemics. Instead we wanna bitch about some people may quit if there's a mandate. We cant even keep people healthy enough to work as it is. The fuck a mandate gonna matter if some people quit? Those people who would quit over a mandate are the least of our problems.

80% of the adult population has the vaccine. And treat it like the flu instead of this super scary pandemic. Shutting down schools was stupid, and most normal people knew it at the time instead of hindsight. And the labor shortage has nothing to do with people being sick, not sure where you came up with that. And the mandate will just exacerbate the labor shortage, so don’t do it? We have better ways to deal with Covid now, and new pills are also on the way.  It’s been almost 2 years and we are still acting like it’s brand new. People are still wearing masks outside and in the car like idiots.