Thanks comrades o7
Corporations are taking advantage of crises, real or invented by corporate media, to jack up prices. Corporate media is passing off this nationwide price-gouging and collusion as temporary inflation caused by people "not wanting to work anymore", the thousand or so dollars some individuals got in stimulus money, and/or Russia
One of the suppliers for my job told me they were raising prices because everyone else was.
Pro TIP: sometimes carrying on an inefficient system is good job security. I once programmed a fax machine to send out faxes automatically from a list, and lost an entire afternoon that could have been spent in a mindless, easy task sending them one by one. Important lesson learned.
Jesus christ. NATO just couldn't keep it's dick in it's fucking pants.
In times like these you can raise prices and still undercut your competitors. Or if you have a limit on what you can supply, not raising prices when everyone else is, is basically leaving money on the table. Free market efficiency at work.
and with the speed information travels now it's so much easier to coordinate with everyone else.
From what I can gather, the inflation we're seeing right now is a combination of a lot of things, mostly caused by covid and acceleration of trends that have existed for a while.
In terms of general inflation of goods, most of this inflation (contrary to what a lot of people want you to believe) is not caused by the Fed printing a shit ton of money, stimulus checks, or any of that. It's in large part "real" because the price of shipping goods from around the world has gone up tremendously. Thanks to covid shutting down ports and more people shopping for things online, transporting goods becomes more expensive. A lot of those "goods" aren't consumer goods but parts for factories and things like that. So even if your item is made fully in the US, if a machine in the factory breaks and you need to order the replacement part from China, good luck. It costs more and takes longer, and that is then pushed on to the price of the underlying good.
This is exacerbated by a particular supply glut in semiconductors, which are now in everything from cars to toasters to your cell phone. Semiconductors are incredibly difficult to make, are made by machines worth millions of dollars, and there's like two companies in the world that can make them at all. The supply of those semiconductors, as more people want to buy cars and other things, is heavily constrained on top of already skyrocketing prices of logistics.
Couple both of these trends with the trade war with Russia, which supplies a lot of fertilizer and precious metals for things like semiconductors and consumer goods, and you have a crazy inflationary environment. Once inflation starts going, it's hard to stop as people come to expect it, which causes prices to rise further. The supply chain issues won't clear up until 2024 at the earliest, when more container ships being built right now come into service, and that's predicated on covid not continuing to shut down ports. Likewise, the Great Resignation plays into this as well because port unloading and loading is slower as there are less longshoremen to do this kind of work.
As far as housing goes, that's partially because of all these trends above but also because a bunch of folks from places like San Francisco or New York, who make a fuck ton of money, can now move to wherever and buy houses across the country for much higher prices than the people who live there can afford, so they push up housing prices for everybody and then there's a knock on effect. You couple that with the cost of housing materials skyrocketing and people wanting more space for houses thanks to the proliferation of remote work and you have a recipe for very high housing prices.
kickass response, thanks, this is exactly what i was hoping i'd get
contrary to what the one poster already said, I think 100% of the excess inflation is from bad monetary policy.
The government embraced the stonks can only go up ideology. Would not raise interest rates for any reason. Dumped mega trillions of stimulus on the business sector making $600 gamer checks look like small potatoes. Now we are growing way too fast.
100% policy failure.
The mega trillions of printing money has been happening since 2008, it's only now that we're seeing inflation. Japan engaged in quantitative easing as early as 2001 with no inflationary effects. Similarly, we dumped trillions in stimulus to banks and other businesses in 2008-2010 with no inflationary effects. We didn't even see inflation after the stimulus bills of 2020 or 2021. It's only now, with the supply chain totally broken and things starting to break down with no replacements in sight, that we're seeing inflation. That suggests a different cause than the one you're suggesting. Not saying that massive levels of stimulus are helping the situation, but the trigger does not seem to be quantitative easing or stimulus money.
No, the trigger is not the money supply. It's still a monetary policy failure to not manage demand when supply chains break down.
The 2008 example, it's not as simple as more money = inflation and that's not what I'm saying. It's more about demand management. Which yes has a lot to do with interest rates.
We didn't have inflation in 2008 but we did have this meaning people anticipated inflation at some point in the future, horded money, demand falls, inflation canceled before it began.
Ah I see what you're saying. Yes, this has been a tremendous policy failure and the Fed definitely should have raised rates far earlier.
The problem with this though is that because of the perpetual reluctance of Western governments to use fiscal policy to drive growth and pursue public works, social welfare, or job programs, they are basically left with only a single tool (monetary policy) to manage the economy.
Yes you can say it would have been better to raise interests rates much earlier in order to avoid the asset bubbles we have now, but the ultimate effect of that would have also likely have been chronic stagnation and chronic high unemployment, and an even shittier recovery than we actually got after 2008, because there was a fundamental lack of interest or inability in bourgeois states to confront these problems in any way other than cheap credit and quantitative easing.
Certainly there are strong monetary influences on the current situation but I don't think you can understand this as purely a failure of monetary policy, because monetary policy really isn't supposed to deal with all of the issues it's being used to deal with on its own.
Well the ubiquity of porn on the internet has an effect on people's fetishes where they can get addicted to it and go down a long and winding rabbit hole, turning to increasingly more extreme representations of sex as the previous ones become dull through repetition, and it seems like there is no limit to the extremes the mind can go to as more and more people fetishize incredibly unhealthy, dangerous, and even deadly practices. All told this is a pretty minor phenomenon and you shouldn't look down on people for being into inflation no matter how strange you think it is - but as an aside never ever attempt to "inflate" part of yourself because the human body is not designed to hold pressurized air and you will cause major, possibly permanent damage.
Oops! Our Bad! IMF Director Admits “We Printed too Much Money”
"I think we are not paying sufficient attention to the law of unintended consequences. We take decisions with an objective in mind and rarely think through what may happen that is not our objective. And then we wrestle with the impact of it.
“Take any decision that is a massive decision, like the decision that we need to spend to support the economy. At that time, we did recognize that maybe too much money in circulation and too few goods, but didn’t really quite think through the consequence in a way that upfront would have informed better what we do.”
"We act sometimes like eight years old playing soccer. Here is the ball, we are all at the ball. And we don’t cover the rest of the field.
“Our ability to deal with more than one crisis at one time is very, very limited. and we have to zero in on the really big things that could determine the future and keep our attention on them.”
Economics is definitely a real science and not just a bunch of wizards divining with the entrails of a pig.
I read this as “I live under a rook”, saw the question mark at the end and got really excited for the riddle that I was no doubt about to read.
S’not fair precious :angery:
One cause is raw material shortages that are due largely in part to the ice storm that happened in Texas. The storm destroyed several raw material plants and caused a shortage in certain industries. I work in the paint industry and we have had a major raw material shortage thats caused the paint companies to raise their prices up to 30% in a year.
