Comment on US Federal Reserve raises interest rates for the first time since 2023
iopq@lemmy.world 2 days agoOf course it would reduce demand, poor people would just skip meals. Just because it’s not discretionary doesn’t mean they would still spend the money they don’t have
This has been found multiple times, giving money to poor people boosts spending more than giving it to rich people. So if you want to cut spending, doesn’t it follow you take it away from poor people? You can’t have it both ways
pmtriste@lemmy.world 2 days ago
I don’t want to cut spending, I want to reduce the monetary supply. It is extremely well documented and effective. And no they won’t cut spending, they’ll just go into more debt. Seriously, stop and think about it, the reason for inflation isn’t spending, it is monetary supply. That’s why when a government like Zimbabwe prints money like water, they have terrible inflation. We’re doing the same thing, and we CAN fix it by taxation. Taxation without imagining some stupid fantasy of “budget” that the Right (and “Left”) has been lying to us about. Taxation without government spending reduces inflation by lowering monetary supply, thus strengthening the buying power of the remaining currency. The government keeps huge discretionary budget spending which (along with obscenely low bank lending requirements) is what is driving up inflation. We need to cut stop wasting money on graft and war, and spend it only on the peopkebwho actually need it and in infrastructure investment.
iopq@lemmy.world 2 days ago
We don’t print money and give it to the government directly. How do you reduce the monetary supply when the money isn’t free to begin with? The government pays the money back eventually!
So we’re back to quantitative tightening and raising interest rates. Which reduces spending!