Madison320
Member

Both, except I have no idea why it took so long for the original QE to show up in M2. All I know is that it ALWAYS will eventually. Anyway I asked the question the wrong way. What I meant to ask is what do you think makes M2 go up in general?

Yeah but when you said that printing money has no effect on M2 the genius award got cancelled. Please send it back. What made M2 go up?

The narrative has gone from: - Deflation is the only thing we have to worry about, not inflation. - Inflation is only temporary. - Inflation can easily be fixed because the economy is the strongest it's ever been. - Fighting inflation may cause a mild downturn, but nothing close to a recession.

I don't think the crypto/stock crash adds to the amount of money chasing goods. The crash is just the perceived value of the crypto coming down, it's not adding to the amount of cash. If I buy a million dollars of bitcoin and it crashes to 0, I'm out a million in cash. I sold my house 3 years ago and invested the profit. Whenever my total investment goes up over a certain amount I sell it and use it to supplement my job income. So when it was going up it was great, I was looking for ways to spend money, but now it's down and I'm having to be frugal. I think a common mistake is to only look at a portion of the economy. This is the main principle explained in hazlitt's book, economics in one lesson. For example if the government builds a stadium it looks like that's adding to the economy but what about all the money taken that is used to build the stadium? I think the same thing is happening with inflation. We have inflated the money supply from 1 trillion to 9 trillion in the economy "as a whole". That money is moving around doing all sorts of crazy things. I think most attempts to calculate the amount of inflation are wrong based on the fact that they are not look at the economy "as a whole". They're just looking at parts of it. The way I look at it is that there's an underlying force that wants to drive prices up 9 times what they were. But I have very little idea how long that's going to take or which prices are going to rise or fall during the process. That being said I'm almost positive that the final resting place is in essential things like food, energy and shelter.

Who's more wrong, the few people who predicted inflation early or the 99% who said we only have to worry about deflation?

That Oakland concert was a classic. Summer of 77 was a comeback tour in a sense. Allen Collins so effortless and having fun. One of the greatest of all time.

No tattoos and thinner.

Big government caused this disaster not free market capitalism and now you want even bigger government to fix it?

I think it's funny that the federal reserve claims their previous QE had nothing to do with current price inflation, but they need to do QT to cure current price inflation.

I'm just getting annoyed that no one seems to know where inflation is coming from. It's caused by printing money, period. In fact the proper definition for inflation is the expansion of the money supply. Rising prices is just an effect of inflation, not the inflation itself. And money printing is caused by excessive govt spending. It seemed like there was a brief window when people were starting to get the concept, maybe 6 months ago. But now the democrats are pushing the idea that it's Putin and Greedy Big Business and republicans the idea that it's an oil supply problem so now I'm constantly reading articles and posts, even on this website, about what is causing inflation, and they don't even mention the printing of money and the govt spending.

If the south seceded they would have eventually freed the slaves and there would be a much better chance that the federal government wouldn't be enslaving people with 50% tax rates like they are now.

The Fed increased its balance sheet again for the 3rd week in a row. I think I'm the only person in the world who's noticed this. I think something is going on, they may be losing control of short term rates again like in the fall of 2019. They're going to have a problem if they hit 9 trillion, that'll get noticed, even by clueless financial reporters.

The supply of oil is only a tiny part of the problem. The major problem is the supply of money, that's by far the biggest reason oil is going up along with everything else. We increased the money supply from 1 trillion to 9 trillion since 2009. We need to massively cut govt spending, it's the only way to reduce price inflation. I'm not saying we shouldn't free up the oil companies and let them produce oil, that's a good thing. I'm just saying it's not going to make a big difference in the price of gas.

I lean pro choice, but this is the way it should be. It's a state issue.

There's not going to be a perfect system but allowing one state to protest the results of another state seems way worse to me than just accepting the results unconditionally. I can see all kinds of bad things happening. For example suppose Trump barely wins in 2024 and then California protests that Texas was suppressing votes of minorities. So the federal government overturns Texas election results and Biden wins. It sounds like you're suggesting that all 50 states should approve of the results? Ok, what if Trumps wins then California, NY, and NJ protest the Texas results. So by default until everyone agrees Biden stays in power. The only way that you can give a state the power to overturn another state's results is to involve the federal government. I don't think it's Texas's business how California votes or vice versa. Of course even better would be to just allow Texas to secede ...

So according to you secession should only be "permitted" if the entity trying to secede is "right"? You do see the problem there don't you? I think you're missing the overall point of the right of secession. In general, guaranteeing right of secession helps keeps governments more free. Do you disagree?

I think it's a dangerous path to go down, this is federalizing the election. I think the states should have the right to tally up their votes any way they want.

All that crap is stupid but that's only a tiny cause of inflation. By far and away government spending is the actual cause of inflation and neither party wants to touch that.

I'd rather be earning a dividend at 5% in a solid company that makes a profit or buy some gold rather than sitting in cash or a bond. I think when the Fed pivots back to easy money the price moves could be massive. I bought a bunch of oil stocks when it was almost nothing a year or two back, now I'm wondering when to sell some. I think oil is going to at least $200 a barrel when the Fed pivots but I'm afraid of what the govt will do, oil companies are pretty much public enemy number one. There might be draconian stuff going down. Even on this forum there's a lot of people who think oil is somehow community property and therefore the govt should control it, like force US oil companies to only sell within the US. My thought is that farming may be safer, it's not as hated of an industry.

It sure took a long time but all that borrowing and printing over the last 10 years finally caused consumer prices to rise. That's what finally caused the Fed to have to tighten monetary policy. At some point the recession is going to be more politically unpopular than the inflation and the Fed is going to reverse course, set rates to zero and resume printing.

Sitting in cash you're losing at least 10% a year due to inflation. And you might miss the boat when the Fed pivots. I totally agree about the solid dividend stocks, that's like 75% of what I own, mostly foreign companies.

I don't think this is like anything we've experienced in the past, at least not the US. That's because this time we have so much accumulated debt that we CAN'T fight price inflation without sending the economy into depression. Debt is an accumulation of mistakes made in the past. You can't just wish it away. I think the best case scenario is that we live with double digit inflation for 20 years or so until prices normalize to the fed's balance sheet. But that assumes no wars or disasters and that the govt slows spending dramatically. The last 2 weeks the Fed has been expanding the balance sheet. It went up almost 20 billion this week. I've been reading that this might happen, the Fed may try to raise rates but also restart QE. I think that's because it's the only way to finance the debt without defaulting.

I'm sure Pelosi is using inside information to buy and sell specific stocks but I don't see how she's driving any of this collapse. Besides, where would she put her money? I saw this collapse coming a mile away, just check my posts over the last year. But I'm still taking a bath, just not as bad as most people. But as I've been saying I expect the Fed to reverse course, that's when I think the value stocks will go way up.

I'm kinda thinking the opposite. I think Pelosi and friends net worth are getting decimated along with everyone else. Which is why I think the Fed is going to pivot from tight to easy at some point. At some point the pain of recession is going to surpass the pain of inflation and the Fed is going to start easing again. Also people with large amounts in equities, like congressmen, are going to get hit harder by a collapsing stock market then by inflation. I'd almost guarantee they're going to put pressure on the Fed behind the scenes. Probably some really serious pressure if you know what I mean.

Powell: "No sign of broad slowdown in economy" LOL!!!

I agree that that Biden's policies limiting oil supply have made it worse, but I don't think it makes that much difference. Oil is a global commodity, plus it takes awhile for Biden's policies to take effect. If Trump were still president we'd still be having the same problem. Maybe oil would be 118 instead of 120. The root cause of the problem is government spending, which leads to printing, which leads to price increases. We're close to our all time peak in oil production. https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MCRFPUS2&f=M

Well since I didn't attend the 2030 Great Reset Meeting I'm just going to assume oil is actually not going up, the dollar is actually going down because we increased the money supply by 9 times in the last 12 years.

I think at some point inflation and the economy will be bad enough that spending cuts will be back on the table. I just don't think we've hit that point yet. I think we need actual inflation rates of maybe 20-30% and high unemployment before everyone is miserable enough to cut spending. There's that expression, "change happens when making a change is less painful than staying the same". I think we're getting close to the Fed pivoting back to easy money. Another few months or so. Also I read somewhere that the new thing may be for central banks to keep doing QE but raise rates. I think that may be a possibility because I think they can survive higher rates but can't go without QE. Like a person can live for awhile without food but they absolutely need water.