Submitted 6 months ago by MicroWave@lemmy.world to economics@lemmy.world
Key Points
Monetary policy that worked historically did so I’m an environment where monopolies and oligopolies were broken up to prevent price gouging.
And they were taxed enough to keep them from getting “too big to fail”.
They also didn’t have the fucking Internet and algorithmic price fixing that spreads throughout the market immediately.
Very puzzling to me that anyone is blaming government spending for inflation. Is that just a corporate scapegoat?
No, new money entering the economy comes from the government and government spending is one of the ways that happens.
Government spending is doing some heavy lifting here.
Yeah, if you are Zimbabwe and you are minting your currency like there’s no tomorrow while all your debt is in USD. Your currency is at a huge disadvantage and you’ll hit trillion bank notes in no time.
Rich countries trade massively while having other countries hold their debt. This makes rich countries are literally too big to fail in our capitalist system. As long as a rich country is growing their economy they can mint as much as they want.
Japan are taking this to extreme levels because they are fighting deflation from an aging population. Russia had double digit inflation because of Western sanctions, but they literally spent their way into single digit inflation with their war economy.
This “fiscal responsibility” from conservatives is actually hurting the US economy. The only inflation the fed is fighting rn is high wages for workers. Don’t fall for the propaganda.
It’s a long-standing observation of economists that government spending leads to inflation. Probably the simplest model is that the government is increasing demand without increasing supply.
Note that in this model, taxes have a deflationary impact because they reduce demand from individuals.
This is not an opinion on how much government spending is affecting current inflation (nor how much inflation is to blame for any particular category of goods).
Hey at least corporate profits are near all time highs though! It’s great! Gonna trickle down any time now!
I’m afraid to ask this, but is that adjusted for inflation and normalized by business entity or similar? I know corporate greed is out of control, I’m just trying to figure out if that graph is good representative data or not.
Cmon… Break already…
In all of this, the Amish are probably not affected.
Orbituary@lemmy.world 6 months ago
Why would companies voluntarily reduce their prices when they’re making record profits? They’ll squeeze us until we’re dry.
intensely_human@lemm.ee 6 months ago
To take market share from other companies and make even more profits?
Garbanzo@lemmy.world 6 months ago
What other companies? There’s just a handful of conglomerates and a few defacto monopolies who all stay out of each other’s lanes. Where they should be competing, they colude. We need to elect some trust busters but we keep being told our only options are keep things the same or burn it all down.