CPI jumps 5% in May of 2021, fastest since 2008

ClaytonB said:
It's two lies for the price of one. If the Fed should ever contract the money supply (and it can do this as easily as it can expand it), this would almost certainly trigger another deflationary collapse, ala 1929. So, the threat of deflationary collapse is very real, but the Fed is the only one that can pull that lever.
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That's true. They can contract the money supply but since everything will collapse there's enormous political pressure not to. But expanding the money supply makes everybody happy in the short run so it's easier politically.

Most mainstream economists were worried about a deflationary collapse if the Fed didn't keep expanding their balance sheet. But that's just wrong. The only way we get overall deflation is if the Fed contracts.

Another thing is that the Fed can never reduce their balance sheet back to 0. The assets they own are worth way less than their liabilities.
 
oyarde said:
I'm a steamroller now , baby , I'm bound to roll all over you. In another 20 days we enter the beginning of the 12th month of the worst inflation in the history of the US while the fed has done nothing but make it worse. Will the sheep citizens continue to let the kremlin to treat them this way ? I predict yes.
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How is the Kremlin treating us?
 
Madison320 said:
That's true. They can contract the money supply but since everything will collapse there's enormous political pressure not to.
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The other way to look at it is that the Fed's deflationary-collapse lever is a kind of political nuke that they can use to force Congress or whoever to get in line with whatever its agenda happens to be.
 
oyarde said:
Pink Floyd will remove music from russia.
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Oh, they will, will they ... ?

https://twitter.com/IGN/status/1502449550862299137
64dufaL.png
 
Occam's Banana said:
Business Insider has the answer! (They've since changed the title to "Experts are battling over price controls: a radical, long-dead inflation fix that's either the silver bullet for America's runaway prices or a recipe for total economic catastrophe". LOL)

And these insights are "premium" content they want you to pay for.

https://www.businessinsider.com/pri...on-high-prices-plunge-us-economy-chaos-2022-3
BNaMoSO.jpg
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Geniuses.

The next step after price controls is shortages.

Government spending => Deficits => Printing Money => Rising Prices => Price controls => Shortages

I saw something similar where "experts" were recommending gas vouchers to help with inflation. Duh. In other words fight inflation with more inflation.
 
Since putin will not accept elon musks challenge to a duel it is apparent that the ruskies will be exporting less oil by next quarter due to numerous restrictions imposed by others on themselves . Meaning oil will rise well above current levels unless the chinese release a real killer plague on themselves killing future demand. biden bypasses congress and declares war on russia by announcing 800 million in military aid to ukraine.Gold goes down 4.00.
 
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Madison320 said:
Let's see what happens when we go about 6 months with no QE and a few more hikes.
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It'll take more than that to slow inflation . I think your thinking the economy could dive . That might be true but there will still be inflation. It isnt slowing down this yr
 
oyarde said:
It'll take more than that to slow inflation . I think your thinking the economy could dive . That might be true but there will still be inflation. It isnt slowing down this yr
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It's going to crash hard, depression hard. And yeah, there will still be inflation, hyperinflation if the Fed keeps trying to print our way out of it. Apparently the Fed changed their statement from last month and took out the part describing how they planned to start QE. I have a feeling that behind the scenes the wheels are already coming off the wagon in the bond market from the fact that they stopped QE a week ago.
 
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