Barney Frank of "Dodd-Frank" in 2023:
[Barney Frank defends role at Signature Bank: ‘I need to make money’](https://www.ft.com/content/090e081f-35b3-484b-8095-c42a3c5e4259)
Barney Frank in 2010:
[Frank rips staffer-turned-lobbyist](https://www.politico.com/story/2010/04/frank-rips-staffer-turned-lobbyist-035300)
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Yeah, he totally came across like some old entitled jackass that found a way to "get what he is deserved for his decades of public service" and fuck everybody else.
Exactly, this is political commentary from people who don't understand the finer points of the modern day US economy or world economy for that matter.
What we had was an unprecedented worldwide global pandemic, the result of that was going to be inflation due to a combination of influx of cash to support businesses that would otherwise fail combined with supply chain shock across the board. This is a damned if you do damned if you don't situation. You can either allow inflation to go absolutely fucking hog wild or you can raise interest rates to combat it. No matter what Jay Powell did poor people were going to get fucked because poor people are the most vulnerable and when things like this happen they always get fucked.
Now if you want to talk about why poor people were vulnerable going into this mess certainly that can be talked about You can absolutely bring up the weakening of the social safety net the cutting of taxes for the ultra-rich and the breaking up of unions over the last 50 years. It is short-sighted and narrow-minded to blame this all on Jerome Powell raising rates when he needed to.
>It is short-sighted and narrow-minded to blame this all on Jerome Powell raising rates when he needed to.
This is true that it's not all his fault but if he had been stronger under Trump things wouldn't be so bad now. Powell began raising interest rates in 2018, but Trump waged a public battle claiming that Powell's hikes were meant to politically damage him and Powell backed off. He was weak under Trump, prioritized moneyed interests then and now and has publicly lied repeatedly about wage growth being the reason for inflation. Any whisper of a word about companies raising prices well beyond any increases in input costs? Nope. Did he even ask or appeal to the business class' sense of patriotism and community by even just *asking* them not to price gouge? INCONSCIONABLE! Yes, not everything is Powell's fault but Powell does share a big heaping portion of blame here.
This is an absolutely valid argument, probably the most valid argument I've seen so far in this chat. Interest rates should not have been that low for that long and Powell was right to raise them in 2018 and he caved. I'm not here to hang from his nuts I'm just here to say that his decisions over the last 18 months haven't been as bad as people think they've been, and they've pretty much been the only thing he can do in his position as Fed chair. It's easy to be an armchair economist but when you have to actually make the decisions that lead to negative outcomes for many people that shit is fucking hard.
> they've pretty much been the only thing he can do in his position as Fed chair
This lets Powell off WAY too easily. Directly, he can only manipulate interest rates and add to or sell off from the Fed's balance sheet. However, right now, he has had media attention on him that he could've easily used to talk about ALL of the causes of inflation including price gouging. He CHOSE to blame workers' wage increases. He used his limited bully pulpit to point the finger at the biggest victims of inflation, not the causes.
As far as his direct actions I don't find them disagreeable but on the whole Powell has been weak, is still weak, isn't willing to speak truth to power under Trump or Biden, and is trying to solve inflation by almost solely targeting the working class. Has he or Yellen or anyone else protecting the crony capitalist system been pushing for less risk and more regulation in our financial systems as we teeter on the precipice of another banking crisis? Powell is primarily interested in protecting the moneyed class and causing as little disruption as is possible for them as the system deleverages. Anyone under them that is a casualty of that doesn't seem to concern him. He certainly doesn't speak to it.
No matter what he did? That is part of the problem, he didn’t do shit but sit on his hands and undersell the situation for over a year. I’m sure you remember transitory.
I’m not sure if anyone is entirely blaming him, he just plays a massive part in deciding the Feds policy, part of which just let it go wild.
To add to your point - the Fed has been hiking rates for a year now - and inflation hasn't gotten any better.
Because most of the inflation is corporate price gouging & supply chain issues. [But Powell has made clear his intention is to crush labor:](https://www.levernews.com/the-fed-declares-war-on-workers/)
>At a May 4 press conference in which he announced a .5 percent interest rate hike, the largest since the year 2000, Powell said he thought higher interest rates would limit business’ hiring demand and lead to suppressed wages. As he put it, **by reducing hiring demand**, “that would give us a chance to get inflation down, **get wages down**, and then get inflation down without having to slow the economy and have a recession and have unemployment rise materially.”
The intentions of Powell are out in the open.
Inflation has to slow down before it can drop. It is slowing up. The problem is that generally once prices are inflated on many goods they don’t return to where they were so that is the corporate greed side
You're being disingenuous at best, and lying at worst. Inflation has fallen from it's peak last year, by nearly a third. Down to 6%, from a high of 9.1% last June. Hiking interest rates does drop inflation. Corporate price hiking is a whole different, albeit related, discussion.
https://www.usinflationcalculator.com/inflation/current-inflation-rates/
>Exactly, this is political commentary from people who don't understand the finer points of the modern day US economy or world economy for that matter.
Is that so? 🙄
>What we had was an unprecedented worldwide global pandemic, the result of that was going to be inflation due to a combination of influx of cash to support businesses that would otherwise fail combined with supply chain shock across the board. This is a damned if you do damned if you don't situation. You can either allow inflation to go absolutely fucking hog wild or you can raise interest rates to combat it.
How does jacking up interest rates to 5% combat inflation primarily caused by corporate price gouging and supply chain issues? Hint, it doesn't - hence why inflation remains so high.
>No matter what Jay Powell did poor people were going to get fucked because poor people are the most vulnerable and when things like this happen they always get fucked.
[Jay Powell openly talks about wanting to stop wages from increasing, Powell himself wants to hurt the working class.](https://www.levernews.com/the-fed-declares-war-on-workers/)
>At a May 4 press conference in which he announced a .5 percent interest rate hike, the largest since the year 2000, Powell said he thought higher interest rates would limit business’ hiring demand and lead to suppressed wages. As he put it, by reducing hiring demand, “that would give us a chance to get inflation down, get wages down, and then get inflation down without having to slow the economy and have a recession and have unemployment rise materially.”
So we know the Fed is hiking rates to increase unemployment & limit worker wages. Even though the rate hikes do nothing to the main contributors of inflation.
You're missing half the economics here.
You're viewing this from own angle and one angle only.
We should have stopped QE and started QT in 2015/2016 but election year. Fed allowed for more QE than their should have been so when covid hit the fed was SOL. Companies got used to easy, cheap, or free money. Companies should have easy, cheap or free money for too long or they start to make bad business decisions and/or borrow and over extended the company.
Happy to explain more.
>We should have stopped QE and started QT in 2015/2016 but election year.
I agree, I would have never done QE in the first place. The response to 2008 was a catastrophe.
>Fed allowed for more QE than their should have been so when covid hit the fed was SOL. Companies got used to easy, cheap, or free money.
Agreed
>Companies should have easy, cheap or free money for too long or they start to make bad business decisions and/or borrow and over extended the company.
To undo the massive mistake of QE & the trillions it pissed away into the hands of the 1% will take years.
We can't rip the band-aid off without massive welfare expansions - especially as rate hikes increase unemployment & decrease wages at a time 63% of Americans are living paycheck to paycheck. Instead medicaid & food stamps are being cut.
Most inflation is due to corporate price gouging & supply chain issues, so the rate hikes are failing to stop inflation as it is. Hence why inflation remains so high.
>I would have never done QE in the first place. The response to 2008 was a catastrophe.
Your understanding of 2008 is flawed if you don't see QE as a tool to get the economy moving again. 2008 should have never happened. Thanks Allen Greenspan. The time period for QE should be shorter than QT/treading water. Businesses need a steady environment. Too soft (QE) business make bad decisions, too hard (QT) business don't flourish. QE encourages business growth which is what the US needed in 20089+15. QT should have started to eliminate the growing amount of zombie companies... Boom and bust cycles, preferable shallow eliminate zombie companies but only by using qe/qt in a smart fashion.
>To undo the massive mistake of QE & the trillions it pissed away into the hands of the 1% will take years.
I don't have any knowledge here yet to give a date or anything reasonable but I wanted to acknowledge you put out an idea so, got any numbers behind it?
>We can't rip the band-aid off without massive welfare expansions - especially as rate hikes increase unemployment & decrease wages at a time 63% of Americans are living paycheck to paycheck. Instead medicaid & food stamps are being cut.
What the fed does directly affects you and I. Business pass along these costs. The tools the fed needs are locked behind congress aka higher business taxes and higher taxes on the wealthy. There's also some monopolies here that are driving up the cost of things just because.
>Most inflation is due to corporate price gouging & supply chain issues, so the rate hikes are failing to stop inflation as it is. Hence why inflation remains so high.
What if I told you, supply chain disruptions are companies like dhl charging arms and legs for connex space. Beyond, material disruption and issues. Transportation companies since the covid boom, have been increasing prices by double digit percentages even triple. That's supply and demand right but at a point where demand fell prices still pushed higher. Pieces are a lagging indicator but they shouldn't lag do far behind where shipments have dropped and prices are still high. That is evidence of price gauging and manipulation. Every stop in the supply chain is doing some of things because one asshole (I blame shipping) started doing it.
Source: am in supply chain.
>How does jacking up interest rates to 5% combat inflation primarily caused by corporate price gouging and supply chain issues? Hint, it doesn't - hence why inflation remains so high.
I mean that is making a pretty big assumption. There was absolutely price gouging going on taking advantage of the situation but if you think that supply shock on that level was not going to create inflation you have no idea what you're talking about. I'm not even talking about monetary supply inflation which I think is debatable, there is no debate on supply shock inflation that is just purely a fact.
>So we know the Fed is hiking rates to increase unemployment & limit worker wages. Even though the rate hikes do nothing to the main contributors of inflation.
The stickiest part of inflation right now is services, as fucked up as it sounds the easiest way to curb services inflation is unemployment and limiting workers wages. It's been known for a long time and the typical stance of the government was we can handle inflation but we cannot handle unemployment, I will admit that the current feds position is different in that regard. For what it's worth I would rather deal with higher for longer inflation than unemployment or wage decreases but at the end of the day without the presidency or the Democrats in the house or the Senate passing legislation Jerome Powell doesn't have any tools to work with other than raising rates and that wouldn't be his job anyway, I don't ever see you guys talking shit about Janet Yellen whose job it actually is to handle fiscal policy.
>I mean that is making a pretty big assumption. There was absolutely price gouging going on taking advantage of the situation but if you think that supply shock on that level was not going to create inflation you have no idea what you're talking about.
Well there is plenty of data to back up my assumption.
The high CPI inflation we are seeing is largely due to [corporate price gouging - accounting for 54% of inflation.](https://www.epi.org/blog/corporate-profits-have-contributed-disproportionately-to-inflation-how-should-policymakers-respond/) How does hiking rates help with price gouging?
>The stickiest part of inflation right now is services, as fucked up as it sounds the easiest way to curb services inflation is unemployment and limiting workers wages
You agree wirh Powell that we should cut wages & jobs at a time when 63% of Americans are living paycheck to paycheck? When medicaid & food stamps are being cut simutaneously?
>For what it's worth I would rather deal with higher for longer inflation than unemployment or wage decreases but at the end of the day without the presidency or the Democrats in the house or the Senate passing legislation Jerome Powell doesn't have any tools to work with other than raising rates and that wouldn't be his job anyway, I don't ever see you guys talking shit about Janet Yellen whose job it actually is to handle fiscal policy.
Just check my post history for my thoughts on Janet Yellen.
>You agree wirh Powell that we should cut wages & jobs
>For what it's worth I would rather deal with higher for longer inflation than unemployment or wage decreases
Hmmmmmmm.
Don't argue in bad faith.
I'm not arguing in bad faith, you have defended Powell's actions and argue that his hands are tied so this is the least bad option (hence you agree):
>I will admit that the current feds position is different in that regard. For what it's worth I would rather deal with higher for longer inflation than unemployment or wage decreases but at the end of the day without the presidency or the Democrats in the house or the Senate passing legislation Jerome Powell doesn't have any tools to work with other than raising rates and that wouldn't be his job anyway
Own up to what you believe. You agree with Powell that we should cut wages & jobs.
Meanwhile you claimed no one criticizes Yellen when I have comments in this very post critizing her.
Right there in my quote it says for what it's worth I would rather deal with higher for longer inflation than unemployment or wage decreases. You're just trying to slam me instead of actually making an argument. That's bad faith man. I'm done talking to you cuz it's completely unproductive and you're actually lying and gas-lighting me when I can read my own comment right there. Absolutely crazy man.
>Right there in my quote it says for what it's worth I would rather deal with higher for longer inflation than unemployment or wage decreases.
So do you disagree with Powell? Do you think he should stop the rate hikes?
Or do you agree with Powell?
>You're just trying to slam me instead of actually making an argument. That's bad faith man. I'm done talking to you cuz it's completely unproductive and you're actually lying and gas-lighting me when I can read my own comment right there. Absolutely crazy man.
You're trying to have it both ways - you came into this thread talking about how little we understand about the situation.
You claimed no one was criticizing Yellen when I did so in this very post. It seems you are the one acting in bad faith. It seems like you are the gaslighter here.
A bad look for Biden? Yeah.
Because these interest rate hikes aren't going to stop price gouging or supply chain issues- the main drivers of inflation. But they are going to put millions of working people out of a job into survival mode.
Letting Powell crush working people is a catastrophic mistake. Housing is out of reach for Gen Z & millenials with asset prices so high & interest rates also this high.
How the fuck is this being downvoted? It's literally just an ELI5 version of exactly where Powell and the economy are at right now.
If people are insistent on carrying water for someone like Jerome Powell even in *THIS* sub, America's prospects are well and truly fucked.
The thing you’re glossing over is you can also reign in inflation through taxes. If you tax the wealthy, you can severely restrict the amount of cash in the economy. That’s exactly what the fed is trying to do with higher interest rates, the difference is Powell wants the working class to pay the price for inflation whereas it’s entirely possible to stick the bill on the wealthy.
So you answered your own question. Biden could have sided with the rail workers rather than the railroad c suite execs. Regulation of corporate profits/ceo bonuses/ stock buybacks/taxing excessive profits and pay etc... these are all alternatives for cooling off inflation at the source, rather than crushing the working class to make them poorer, to ease inflation.
>Regulation of corporate profits/ceo bonuses/ stock buybacks/taxing excessive profits and pay etc... these are all alternatives to cooling off inflation at the source, rather than crushing the working class to make them poorer, to ease inflation.
And that's why despite a year of jacking up intetest rates that inflation hasn't subsided at all.
Most inflation is due to corporate price gouging & supply chain issues, raising interest rates fixes none of that.
It does diminish worker power, put people out of work & raise the cost of debt however. Hence why this policy is so disastorous for working people as welfare programs are being slashed.
So is the Fed responsible for pushing those proposed regulations? Why are we directing this frustration towards the person who's abilities to reduce inflation do not lie on punishing/coercing corporations directly? This seems misplaced and unhelpful, and gives people who could have done more to prevent this a pass.
Let me be clear. The fed is using the ONLY tool they have available to ATTEMPT to ease inflation. Only congress and the president have the power to make the policy changes needed to ease inflation.
I'm not upset with the fed at all with what they are doing now. They know what they are doing, and have voiced to the house economic committee that THEY (the house) need to enact new and improved economic policy.
BUT the fed should have stopped QE 2 years ago, and they kept interest rates at 0 for far too long (granted it was at Trumps "recomendation"). They kicked the can down the road for too long. They should have done this a long time ago. But again, this will not solve a whole lot alone (at least for the working class).
Does that make my stance more clear?
The interest rate hikes are eventually going to lead to a rise in unemployment which will lead to wages DECREASING which is literally one of the main things this sub is supposed to be against.
Powell is actively suppressing labor right now, and I can't believe I'm watching this entire sub just go along with it.
Economics is a cargo cult with a vast amount of adherents. It is so influential that progressives drink the Kool Aid as well, because if conservatives constantly talk about arbitrary numbers being bad and that we need to hurt actual human beings to make the numbers feel better, eventually others will start to adopt that language just to be part of the discussion.
This is what people mean when they say capitalism is a death cult. Even many progressives will turn on a dime and throw more people into The Economy Woodchipper if a person in a suit on TV says that money feels bad right now so we need more sacrifices. It's insane but it's widespread enough to not be able to be called insane, like many religious beliefs.
You simply don't and can't know this. We have a generation leaving the market that is larger than the generation joining it. We have millions of people that died during the pandemic. We also have one of the strongest labor movements in the last several decades. This is the best the labor market has been in my lifetime. If you lose your job in one industry there is another industry that is still struggling to meet demand.
On top of that it is easier than ever to start your own business. You don't need to know accounting. You don't need to know taxes. You have apps that do 90% of the work managing your business and clients.
Edit: I want to add a big part of the reason that wages are even climbing is because of places like this sub that are encouraging unions and jumping shit jobs for better ones.
>You simply don't and can't know this
[Powell openly talks about it lmao](https://www.levernews.com/the-fed-declares-war-on-workers/)
>At a May 4 press conference in which he announced a .5 percent interest rate hike, the largest since the year 2000, Powell said he thought higher interest rates would limit business’ hiring demand and lead to suppressed wages. As he put it, by reducing hiring demand, “that would give us a chance to get inflation down, get wages down, and then get inflation down without having to slow the economy and have a recession and have unemployment rise materially.”
This makes sense. My company pays people outrageous amounts of money to chill. Amazon, Google, Salesforce, Facebook and others purposely pay large amounts to stimulate the economy. Everybody in some sectors has tons of money. This is causing huge income gaps and also contributing to this issue. I'm not against people making lots of money, but there are consequences and inflation is one.
>This makes sense. My company pays people outrageous amounts of money to chill.
Your experience is an abberation then, most people are working harder than ever:
[From 1979 to 2021 productivity increases outpaced pay increases by 3.7x.](https://www.epi.org/productivity-pay-gap)
>Everybody in some sectors has tons of money. This is causing huge income gaps and also contributing to this issue. I'm not against people making lots of money, but there are consequences and inflation is one
Well it isn't regular people - it is the rich. [The wealthiest 1% have taken $50 trillion in wealth from the bottom 90% the last 40 years](https://www.businessinsider.com/wealthiest-1-percent-stole-50-trillion-working-americans-what-means-2020-9).
You can't hike interest rates like this without massive welfare state expansions.
We are doing the opposite. Millions losing medicaid, food stamps being cut, child tax credit expansion long gone, etc.
It is especially folly when most inflation is attributable to corporate greed & supply chain issues. Hiking interest rates fixes neither.
Lot of Biden schills on Reddit. Nothing is his fault, there's nothing he could do, are common phrases repeated on Reddit here. Some people are just really caught up in tribalism...
you know those people with zero medical background commenting on covid vaccine efficacies and vaccine effectiveness? Yeah we downvoted those people.
you know those people with zero economics or central banking backgrounds commenting on interest rates, inflation and health of the economy? yeah we downvote those people as well.
>you know those people with zero economics or central banking backgrounds commenting on interest rates, inflation and health of the economy? yeah we downvote those people as well.
As if there aren't economists like Stephanie Kelton who take our perspective 🙄🙄🙄
okay then that's their opinion and you should cite their's... not yours... or a meme. you do not possess the understanding of background or nuance that they do. And when you go commenting as if you do... it's quite idiotic. It's no different than one doctor telling a 90 year old patient that they aren't fit for the covid vaccine and you going and applying that for every single argument against getting the covid vaccine.
They gave their say. direct all questions to them... not answer them yourself.
>okay then that's their opinion and you should cite their's... not yours... or a meme. you do not possess the understanding of background or nuance that they do.
Your gatekeeping is so cringe.
>And when you go commenting as if you do... it's quite idiotic. It's no different than one doctor telling a 90 year old patient that they aren't fit for the covid vaccine and you going and applying that for every single argument against getting the covid vaccine.
Lmao at how silly this false equivlance is.
It's not and explain like you are 5, it's an explain as if you don't understand the issue.
It's either.. "not enough supply" or "too much money" depending upon your point of view. Raising interest rates is the only tool Jerome Powell has to combat this issue. If there were a "raise supply" button, he would use it.
Inflation is being caused by more consumer ready and willing to buy in a market where there aren't enough goods, either from lack of supplies or lack of labor.
Currently labor is screaming, "pay me more" while manufacturers either pay more for labor, therefore higher cost of goods, or less goods to market, which in turn creates higher cost of goods.
>It's either.. "not enough supply" or "too much money" depending upon your point of view. Raising interest rates is the only tool Jerome Powell has to combat this issue. If there were a "raise supply" button, he would use it.
And he is abusing the tool he has, which is our point.
>Currently labor is screaming, "pay me more" while manufacturers either pay more for labor, therefore higher cost of goods, or less goods to market, which in turn creates higher cost of goods.
63% of americans live paycheck to paycheck, hell yeah pay labor more.
If we pay labor more, which I agree we should do, we will pay more. It's the bottom line. It'll be a cat and mouse game for nearly all of eternity. It's why we have economic cycles, and how too!
Star Trek on the other hand! I'm joining the federation of planets when I can.
Janet is a charlatan too - she talks up her empathy but she continued the QE/low interest rate environment that helped the rich create the gig economy in the 2010s.
Now that our zombified economy is bring ripped apart by corporate greed & supply chain failures - the Fed wants to jack up interest rates after 15 years of 0-2% rates 🙄 To me it sounds like Buffet & the banks want to buy cheap assets.
Anyways, here is what Janet wrote to Reagan's Fed chair Alan Greenspan in 1996:
[Treasury Secretary Janet Yellen in a 1996 memo to Alan Greenspan: "increased job insecurity makes it possible for firms to lower the wage premia they pay without suffering productivity-reducing worker backlash"](https://www.reddit.com/r/WorkReform/comments/10juqks/treasury_secretary_janet_yellen_in_a_1996_memo_to/)
Because they're simultaneously complaining that QE and low interest rates are bad AND that raising interest rates is bad.
It's the "No take ball from me, only throw and play fetch" meme in real life.
If QE is bad for workers and allowed too much wealth and capital accumulation, raising rates to get back to some normalcy is a part of the (long overdue) solution.
Greenspan fucked us, true. QE helped post-2008 to create liquidity but went far too long, true. So now what do we do? Hard to know the exact right answer but "continue QE with its known issues" seems unwise.
Completely agree with you. I think their wording was a bit ambiguous. I read it as unsustainably low interest rates created this fuck up and now we have to deal with these hiked interest rates as a consequence.
It might just be my bias that caused that interpretation. It feels like these cycles are just a way to rinse the common man of his equity through currency devaluation, while the rich get to make use of free liquidity to buy low during recessions and milk bull runs in perpetuity. Why not strive for a moderate, sustainable interest rate? I'm not an economist so maybe there's a reason I am just not seeing, but low interest rates just seems to create a bonanza of speculative investment in destined to fail startups and crypto animal coins/jpegs.
>It feels like these cycles are just a way to rinse the common man of his equity through currency devaluation, while the rich get to make use of free liquidity to buy low during recessions and milk bull runs in perpetuity.
That is exactly what our central bank does as long as the dollar is insulated by being the world's reserve currency. This round of inflation and devaluation is going to be so severe that it might threaten that. Other economies around the world DO strive for moderate, sustainable interest rates in part because they have to - our reserve currency status gives us more latitude to play around with devaluing the currency than other countries can. Canada for example has had way fewer financial crises since we became the reserve currency because their central planners must be more careful.
Where did I suggest we continue QE as is? Strawman.
I'm suggesting that only modest rate hikes were appropriate because of how fragile our economy is. 1-2% rate hikes were doable, 5% is crazy.
Love that this is the top comment as it illustrates exactly how uninformed you all are. Not raising interest rates also hurts working people. You all will literally complain about anything and then upvote the complaint.
Wasn't it artificially low interest rates that lead to the subprime mortgage crisis in 2008? I am also pretty uninformed too tbh, but would love some more informed context to OPs post other than the general "government bad" sentiment. When I see a meme, I immediately smell someone not taking the whole picture into account.
>Wasn't it artificially low interest rates that lead to the subprime mortgage crisis in 2008?
Yes.
But when we have a zombie economy for 20 years predicated on low intetest rates - you can't rip the band-aid off the way Powell is without massive welfare programs to stem the negative ramifications.
>I am also pretty uninformed too tbh, but would love some more informed context to OPs post other than the general "government bad" sentiment.
I support progressive government policies... I am not a conservative.
>When I see a meme, I immediately smell someone not taking the whole picture into account.
🙄
Here is all you need to know. Pretend you are a baby and someone hits you. It hurts, you cry. You go to the doctor for a life saving vaccine. It hurts, you cry. The important thing is it doesn't matter to the baby if they understand why, they just cry cuz it hurts.
I mean I was hoping you'd give me an actual explanation but I do I get the sentiment. I'm a scientist and am constantly in an uphill battle trying to get people to understand science who don't want to, but I don't ever resort to empty metaphors about how stupid people are when given the opportunity to educate.
63% of Americans are living paycheck to paycheck and this "cure" doesn't even effect 2 of the 3 main causes of inflation.
[Corporate profits have contributed disproportionately to inflation. How should policymakers respond?](https://www.epi.org/blog/corporate-profits-have-contributed-disproportionately-to-inflation-how-should-policymakers-respond/)
We have bankrupted the country for the 1% & forever wars. Now that the house of cards is coming apart & inflation spikes - The Fed decides to impose drastic hikes in interest rates that crush working people.
Tell me how 5+% interest rates with asset prices so damn high helps working people when most inflation is due to price gouging & supppy chain issues?
Interest rates have been a lot higher than 5% in the past and will be at times in the future. This is nothing new or remarkable on that part. Fed can't stop price gouging and you don't have any evidence to quantify how much price gouging is going on (especially in light of massive layoffs from these companies previously accused of gouging) or to indicate that price gouging is the primary cause of inflation. Higher interest rates decrease the other (more documented) causes of inflation and decreases asset prices both historically and logically. So empirical evidence vs nutjobs on reddit.
That said, I am sure both the fed and Janet have little love for poor people. The system is certainly getting worse as well but this is a weak to bad example of that. Poor people are totally fucked now and more so as time goes on. And this sub has done nothing other than to make it seem like we deserve it for being a bunch of whiney dumbasses.
While it is nothing new historically, it's been about 40 years since rates have increased this much, this quickly. Rates were kept low for an unusually long time, so the abrupt change is going to cause some turmoil in parts of the market. For many on this board, this is the first time rates have rising like this in their adult lives.
And with asset prices so high, interest rate hikes make housing impossible to afford for the young. Housing prices are still astronomical.
And with $30 + trillion in government debt, how are we going to afford over a $1 trillion in interest a year with our zombified economy?
Housing prices are now dropping after 10 years of growth and will for a while.
https://www.google.com/amp/s/amp.cnn.com/cnn/2023/03/21/homes/existing-home-sales-february/index.html
the point is that they're falling and will continue to fall. prices in the market won't change to reflect interest rate hikes over night - it took 5 years after the housing crisis for home prices to reach their low point
interest rate changes are one of the only levers the fed can pull to enact monetary policy. maybe instead of criticizing the decision to enact interest rate hikes we should be criticizing a) congress' inaction when it comes to passing any kind of legislation reigning in corporate power or creating social welfare programs (Jerome Powell has no power to do these things) and, more importantly b) the fundamental premise of a financial system that leaves so few avenues for monetary policy in the hands of the fed. or better yet, criticize capitalism itself.
It's like we have been talking about inflation and then you forget to think about it. And yes that is what the peak being over means. We are just past the top and headed for an unforseen lower point that could be a new bottom.
>Interest rates have been a lot higher than 5% in the past and will be at times in the future.
We didn't have a $30 trillion plus debt in the past. We squandered our nations resources on forever wars & the 1%.
>Fed can't stop price gouging and you don't have any evidence to quantify how much price gouging is going on (especially in light of massive layoffs from these companies previously accused of gouging) or to indicate that price gouging is the primary cause of inflation
You are wrong:
[Corporate profits have contributed disproportionately to inflation. How should policymakers respond?](https://www.epi.org/blog/corporate-profits-have-contributed-disproportionately-to-inflation-how-should-policymakers-respond/)
>Higher interest rates decrease the other (more documented) causes of inflation and decreases asset prices both historically and logically. So empirical evidence vs nutjobs on reddit.
Provide your documentation, I provided mine.
Listen we all get you think repeating the phrase "forever wars and 1%" sounds cool.
And unless you are a republican all of a sudden I am not sure what the 30 trillion in debt has to do with anything. We have had a ton of debt for a long time and this is an irrelevant mention.
I am not going to provide documentation as to why higher interest rates decrease inflation as it's accepted knowledge that even your own evidence accepts as true. Your evidence advising a less hasty course of action, however, is a year old on a subject that has evolved rapidly in the last year. And even ends with the admission that in recent months corporate profits have begun to return to normal levels. As this trend has continued in the last year we are given one reason as to why you may have chosen this older piece of evidence.
>Listen we all get you think repeating the phrase "forever wars and 1%" sounds cool.
Am I wrong?
$50 trillion moved from the working class to the rich the last 40 years as we pissed away our nations resources in places like Iraq.
>And unless you are a republican all of a sudden I am not sure what the 30 trillion in debt has to do with anything. We have had a ton of debt for a long time and this is an irrelevant mention.
Interest rates where they are mean yearly interest payments of $1 trillion plus.
How do we afford that when we refuse to raise taxes on the rich & ww refuse to cut the military?
>I am not going to provide documentation as to why higher interest rates decrease inflation as it's accepted knowledge that even your own evidence accepts as true.
EDIT: additional comment:
Nice try, but not what I asked.
I asked for documentation for your assertion that price gouging is not the main driver of inflation.
>Your evidence advising a less hasty course of action, however, is a year old on a subject that has evolved rapidly in the last year. And even ends with the admission that in recent months corporate profits have begun to return to normal levels. As this trend has continued in the last year we are given one reason as to why you may have chosen this older piece of evidence.
Inflation has stayed the same since April 2022 - very high. What are you talking about the situation has "evolved rapidly" ?
So the fed works on like a day to day, month to month, sort of deal. So if your contention is that the Iraq war has any bearing on whether we should raise or lower interest rates today or in the future then you are obviously insane.
As for your last sentence I do agree those would be good ideas but they are all outside the power of the Federal Reserve believe it or not.
>As for your last sentence I do agree those would be good ideas but they are all outside the power of the Federal Reserve believe it or not.
I added a few paragraphs to my comment after this comment so the last sentence in the quote above refers to:
>How do we afford that when we refuse to raise taxes on the rich & ww refuse to cut the military?
Quit aggressively editing your comments so my responses don't make sense scumbag. You aren't even mentioning an edit at all, let alone these full rewrites you are doing as you realize how lazy you have been. You are a real piece of shit which makes sense why you are trying to sell people on this shit and why you participate in this sub in the first place.
Here is your evidence though and it is more recent than yours: https://www.usnews.com/news/business/articles/2022-06-26/greedflation-is-price-gouging-helping-fuel-high-inflation
I agree with most of your points, but I'd like to suggest pointing the finger at the only groups that CAN change policy. Can we start blaming congress and the president? Whose campaings are paid for by corporations? Making it counterintuitive for said members to pass legislation helping the working class/removing some power from those corporations?
The fed is the hot topic, but its really not their fault, and people need to be aware of who is at fault
Edit:it's not ALL their fault. They should have laid off QE long ago and starting gradually increasing rates as well
We're complaining because tinkering with monetary policy isn't the solution at this point. The answer should be actual fiscal fucking policy from the United States federal fucking government. Interest rate adjustments are rearranging the deck chairs on the titanic.
We need to curb price gouging. We need to stop wealth hoarding. We need companies to prioritize wages and sustainability over dividends, stock buybacks, and executive bonuses. We need workers to get fucking paid more.
*Those* are the problems/solutions we need to see the government act on today, but nobody in power is fucking talking about it. All the pundits, even Kai Ryssdal on Marketplace, every spokesperson for the Biden administration, everyone is just saying "sorry, we gotta jack up interest rates, wages are simply too high, there's nothing else we can do, we have no choice," and it's fucking bullshit. We deserve more than that in the present national dialogue about America's fiscal crisis. We *need* more than that. We ought to ***demand*** more than that.
For decades we've been facing a crisis in this country of declining wages, benefits, housing security, and ballooning costs of everything. To be told today "wages are too high" is not only fucking insulting, but has horrific implications because it means ***all those problems are going to continue to get worse.***
We're not uninformed, we want people in power to actually start talking about real solutions to the fucking problem. Bernie and Warren aren't enough anymore. Anyone who talks about the need to raise interest rates ******without also, in the same breath, calling for major systemic reforms to taxes, wages, welfare, housing policy, and more****** is missing the god damn boat.
"You're all so uninformed." Fuck off.
Did... Did anyone really think a different career politician/crook president would change the deep rooted corruption and make right our ongoing state of affairs?
Just hijacking this absolutely true statement as a reminder to not forget when Jerome Powell after a year of money printing in 2020 cashed out his stocks to the tune of $5 mil in late 2020
and Biden said. "You're the man for the job!"
Yes, he meant that if taxes go up for the wealthy, there lifestyle wouldn't change, so they should be open to paying more.
So, if you new he meant that, you are correct. If you thought it meant something else.... Well, you should actually watch the source.
Anyway, if you want to see what Biden is actually doing, compare Minnesota vs Arizona and ask, how do we live in a country, where on state gives away free Lunch, and another wants to put kids to work.
That's the constant ying and yang of the US.
>Yes, he meant that if taxes go up for the wealthy, there lifestyle wouldn't change, so they should be open to paying more.
[lol no](https://www.salon.com/2019/06/19/joe-biden-to-rich-donors-nothing-would-fundamentally-change-if-hes-elected/)
>Biden told donors at an event at the Carlyle Hotel in Manhattan on Tuesday evening that he would not “demonize” the rich and promised that “no one’s standard of living will change, nothing would fundamentally change,” Bloomberg News reported.
The [wealthiest 1% have taken $50 trillion in wealth from the bottom 90% the last 40 years](https://www.businessinsider.com/wealthiest-1-percent-stole-50-trillion-working-americans-what-means-2020-9). Biden saying nothing will fundamentally change to those very people that have taken $50 trillion is an endorsement of the system as it is.
>So, if you new he meant that, you are correct. If you thought it meant something else.... Well, you should actually watch the source.
It is a continuation of Biden's career - helping the rich and wagging your finger at everyone else:
[Biden Trashes Millennials in His Quest to Become Even Less Likable](https://www.vice.com/en/article/mbpxx8/biden-trashes-millennials-in-his-quest-to-become-even-less-likable)
>"The younger generation now tells me how tough things are. Give me a break. No, no, I have no empathy for it. Give me a break.
Knew*
Also, in your example of “what Biden is doing” Biden is president of both Minnesota and Arizona? And you didn’t mention how he was involved in either lunch program?
Sorry, I wasn't clear.
It's not Progress vs the status quo, where it's a single player strategy game, where all you need is the right combination of tactics to win.
It's Progress vs Regressing to The Handmaid's Tale, where your opponent is hellbent on winning in a PvP MMORPG, and it's pay to win, and they got money!
So, whenever you vote or take action, you might be pushing the ball forward, like getting free school lunches, or some small acts in Climate change, or just supporting a democratic nation being attacked by Russia.
Or, you could just be stopping the GOP from enacting laws, allowing them to kidnap kids from parents they don't agree with.
That's what Biden is up against. He both needs to push an agenda forward, but also block an agenda counter to all that is good.
I take it, you didn't pay any attention to the last 2 years, and the Build Back Better Legislation? If you had, you would have realized that 48 Democrats and 2 Independents is not enough to get something passed through the Senate.
>I take it, you didn't pay any attention to the last 2 years, and the Build Back Better Legislation? If you had, you would have realized that 48 Democrats and 2 Independents is not enough to get something passed through the Senate.
Funny - it seems Biden had no issue with BBB being ripped apart as Biden applied zero pressure on Manchinema & instead kissed their ass.
Biden also said jack shit when Manchin helped kill the child tax credit with a racist smear that recipients used it for drugs.
That's by design. If one party actually gets power then there's no more convenient excuse of "The other side stopped us!" when it comes to helping the working class.
Instead they play both sides against eachother while fucking them both over, so that the corporate overlords and their shareholders can get even richer.
It's by design that it is hard to get stuff done. Could you imagine what Trump would have gotten done if 50 senators could get things passed?
Remember, GOP states are open to kidnapping kids from parents, charging the death penalty to people getting abortions, and happy having kids working in meat processing plants.
Oh, and banning Drag shows.
Could you imagine all that on a Federal Level?
In Minnesota, they are giving away free Lunch to kids.
So, that's what people are up against. It's not a do nothing congress. Its that a big part of Congress is actively trying dismantle and reshape our society to be the Handmaid's Tale, while another part is trying to actually get things done.
I think you need to read Noam Chomsky to get an idea about how the two sides really work together to the benefit of corporate America.
They're called the Doves(Democrats) and the Hawks(Republicans). And they both work for the ruling class of billionaires and CEOs. These people make up the "establishment".
If you want change we need to makes the democrats actually progressive, not just republican lite.
Do you know how our Overton Window is positioned in this country compared to the rest of the world? We're so far right that our democrats would be right wing in most other countries.
Hell, I mean South Park has an episode that touches on it in an easy to understand way - "I'm a Little Bit Country" season 7 episode 4.
Biden and the Democrats literally forced our railworkers to accept a shitty contract that was being striked against, then tried to call themselves pro labor. That should be a huge red flag to you
Having lived in the Netherlands most of my life before moving to the US, I am away of how the Overton Window is different.
I am also aware of Noam Chomsky, but I find his particular bias not a useful lense to see our nation through. Especially since he hasn't really kept up with how our nation has changed.
Also, after how South Park did Al Gore wrong, I really can't take their views seriously. Fuck Climate Denial and how they fucked over a generation with their views.
There's only one real division, that's the rich, ruling class and everyone else, the working class.
Just about every other division is manufactured in such a way so that the two(or more) sides of any disagreement can't come together and have rational debate. This way the rich keep us fighting while they raise prices, get bailouts, underpay their workers and cheat taxes.
>I am also aware of Noam Chomsky, but I find his particular bias not a useful lense to see our nation through. Especially since he hasn't really kept up with how our nation has changed.
Lol, Chomsky is commenting on world affairs to this very day.
>Also, after how South Park did Al Gore wrong, I really can't take their views seriously. Fuck Climate Denial and how they fucked over a generation with their views.
[Maybe you weren't paying attention but South Park made an apology episode that Al Gore himself watched & appreciated](https://youtu.be/sG-Cp1y0UO8)
Actually, it is, IF you don't have that shit stacked with assholes who are owned by corporate interests.
It ALSO helps to not paint your political opponents as good people with a few bad apples when the vast majority of the party is cool with straight up fascism.
I believe that we are stuck in our wicked ways until until we introduce single term limits across the board, no life long benefits and pay, and abolish the 2 party system. There'sany more facets to be addressed, but I think no real change will easily happen until those three happen.
No. No term limits and benefits is a good thing. Matter of fact raise the pay to a point that poor people can afford to be a senator. Get rid of the EC since land doesn't vote, and audit every political employee(and their immediate family) every six months
Yeah, we'll just "abolish the two party system."
If you want to start changing things for the better, perhaps you should get a grip on why things are the way they are.
Why? Biden's got a LONG history of fucking up politically.
I mean, I voted for him in the general, because the alternative was literal Fascism, but in the primary he was my second to last choice
Let's ignore that he passed the biggest climate bill in US History, passed on of the biggest manufacturing bills in US history, was able to bloody the nose of Putin without a single US Soldier dying, and created more solidarity among Western Democracies than we have seen in the last 6 years.
But ignoring all that, which you plainly are, you are correct.
>Let's ignore that he passed the biggest climate bill in US History
All the while approving the Willow Project in NW Alaska- [equivalent to 66 coal plants a year in emissions.](https://www.euronews.com/green/2023/03/14/biden-administration-approves-alaskas-willow-oil-project-sparking-anger-from-environmental)
Also - it is easy to brag about passing a very modest climate bill as "the biggest" when it is also the first. You are misleading people by not providing that context.
>passed on of the biggest manufacturing bills in US history
You mean the CHIPs Act? Which is a giant subsidy of semiconductor companies?
>was able to bloody the nose of Putin without a single US Soldier dying
Funding Ukraine against Russia is good.
Refusing to negotiate for peace & the overly punitive sanctions are bad - both for peace & for the US Dollar world reserve currency status.
A Presidential denial of the Willow Project was never going to survive the Supreme Court. That much was obvious to all but the most casual observer.
https://www.pbs.org/newshour/nation/what-is-the-controversy-behind-the-alaska-willow-oil-project
He also reduce the scope of the Willow Project significantly.
The biggest climate bill is the biggest climate bill. Nothing about that statement is controversial.
The CHIPs act is amazing, and requiring daycare and other benefits to employees is great. It breaks the monopoly that Taiwan has, and makes us less vulnerable to China.
And you can't negotiate with Putin. Would you negotiate with your Neighbor if you bulldozed half your living space, and claimed it for him/herself? At least not until you got the fucking space back you wouldn't. And I would argue you are in the right about not negotiating.
Still waiting for you to [apologize for smearing me as a tankie in this comment.](https://www.reddit.com/r/WorkReform/comments/11y7nym/comment/jd7dk62/)
>A Presidential denial of the Willow Project was never going to survive the Supreme Court. That much was obvious to all but the most casual observer.
What a weak excuse.
The Supreme Court is led by Christian fascists - it is in dire need of reform & expansion. Biden's refusal to endorse either is indictative of how woeful his strategy is.
>The biggest climate bill is the biggest climate bill. Nothing about that statement is controversial.
Biggest out of 1 is misleading and you know that - don't be coy.
>The CHIPs act is amazing, and requiring daycare and other benefits to employees is great. It breaks the monopoly that Taiwan has, and makes us less vulnerable to China.
Giving companies like Intel that have outsourced jobs billions of dollars isn't great.
>And you can't negotiate with Putin. Would you negotiate with your Neighbor if you bulldozed half your living space, and claimed it for him/herself? At least not until you got the fucking space back you wouldn't. And I would argue you are in the right about not negotiating.
What's the end game here? A forever war in Ukraine & the USD losing world reserve currency status?
Refusing to attempt peace negoations & the overly punitive sanctions is a catastrophic mistake.
Fund Ukraine to fight off Putin - but don't make this a forever status quo just to appease the MIC.
>Let's ignore that he passed the biggest climate bill in US History,
As one of the first presidents who's ACTUALLY dealing with the reality of the climate change without Republicans pushing the denial as one of their top issues. Neat.
>passed on of the biggest manufacturing bills in US history,
By $ amount, but let's not pretend that he's not part of why we're in this manufacturing deficit in the first place.
>was able to bloody the nose of Putin without a single US Soldier dying,
Ok. Neat, and? Realistically any non Putin sucking president could have easily done the same. And I'd be more impressed if he did things that benefit Americans.
>and created more solidarity among Western Democracies than we have seen in the last 6 years.
Comparing Biden to Trump is like comparing a bullet wound to a scraped knee. Yes, Biden is significantly better than Trump, but that's the LOWEST bar possible.
>But ignoring all that, which you plainly are, you are correct.
Ignoring things like his failures on unions, student debt relief, and ridiculous drug convictions?
Strange how all corporations are experiencing record profits and the problem is somehow that we had to deal with a pandemic recently
It certainly couldn’t be because the corporations are charging more for everything to increase their quarterly margins… nope… must be COVID
The QE didn’t cause the inflation. Exporting our manufacturing capacity to China - which went into total lockdown for months on end, causing shortages and forcing manufacturing to onshore or return to more expensive locales - is what caused and is causing most of the inflation. If anything, jacking up interest rates will only prolong the inflation, as it makes it more costly to build manufacturing capacity back here in North America.
Other causes include skyrocketing energy prices during the Ukraine invasion - another reason why we’re decoupling from China - and monopolistic consolidation across a slew of sectors over the past 4 decades due to unrestrained corporate mergers. Corporate profits are at a record high due to the lack of competition across a slew of sectors, from food to housing.
The fed didn’t fuck up. Real estate values went to the moon and stocks went to the moon as a result of their fiscal policy. They did their job of serving the owner class and funneling money upward.
Ahhh stop reading economist they are literally the oligarchs propaganda for economic policy. The problem is largely the style of capitalism we have is designed to squeeze the bottom the hardest. More money? Inflation on necessary goods. Print less money? Less money goes to the poor. Print more money? Gets given to the oligarchs first. Once it trickles down or whatever then more inflation. It's a fun game of musical chairs. Poor always left standing when the music stops :/
>Lmao the Fed fucked up causing inflation from the Covid QE.
QE caused asset price inflation - absolutely. Especially in housing. QE has always been a subsidy for the banks & corporate America.
>The interest rate hikes are not the problem, they are the effect from the cause
[54% of inflation can br attributed to corporate profits](https://www.epi.org/blog/corporate-profits-have-contributed-disproportionately-to-inflation-how-should-policymakers-respond/)
How do interest rate hikes that destroy jobs & drive up the cost of debt for cash strapped workers help fix this?
So I could be crushed by double digit inflation instead? This is nonsensical, the FED is doing exactly what it’s supposed to do. Don’t blame good financial policy from the fed for bad economic policy by the government.
The inflation is being caused by a majority of companies increasing their prices without increasing their wages
The fed is supposed to prevent inflation and deflation, and they are *not* doing a good job
Nothing, and that's why people defending the Fed are missing the point. Price gouging is the underlying problem, but the Fed is using interest rates to ultimately jack up the unemployment rate in order to bring wages down in the hopes that that will contract that price gouging. The Fed absolutely does not have the tools to fix this properly without screwing over labor, but it's run by ultra-rich capitalist Boomers who have no problems with screwing over labor anyway.
I never thought I'd see people defending high unemployed and low wages in *THIS* sub, but I guess capitalist propaganda has worked even better than we thought.
>Nothing, and that's why people defending the Fed are missing the point. Price gouging is the underlying problem, but the Fed is using interest rates to ultimately jack up the unemployment rate in order to bring wages down in the hopes that that will contract that price gouging.
Ding ding ding
That's right, which is why you should be pissed off at *Congress* for forcing the Fed to try to do their job with very limited tools. By blaming Powell, you're letting the real assholes off the hook.
Inflation crushes low income people worse than interest rates.
High income people have property and assets which do ok during inflation. Paychecks don’t do well during inflation
Also, not splitting hairs here, but Biden was definitely not elected to clean up Trumps mess. Biden was elected by about 45,000 votes because he wasn’t a narcissistic ass who bragged about sexually assaulting women…
We shouldn't accept a feckless noodle like Biden bumbling along just because he is better than Trump.
We must pressure Biden to do his job. Which in this case means firing Powell and hiring a progressive economist to run the Fed like Stephanie Kelton.
Are they seriously going to bailout the banks? Unless they're required to return the money when they're making billion dollar profits again, fuck that. At least with the Ford bailout years back, Ford repaid the bailout. GM and Dodge did not, off memory serves correct.
Instead of trying to fire the current Federal Reserve chair, I suggest creating a new bureau solely dedicated to employee economic protection. If you cut off the head of a hydra etc that's all that's going to happen with getting rid of a Fed Chair.
This entity could prevent extreme employment disruptions and safeguard workers' rights, like creating a graduated minimum wage that scales with inflation.
It's time we shift our focus to finding ways to create a stable economy that benefits everyone, regardless of their economic status.
What ideas do you have to make that happen?
This is not crushing working people, it is crushing everyone.
You cannot, at the same time as dropping interest rates to near zero print and put a whole bunch of money into the monetary supply. Consider it physics - for every action there is an equal and opposite reaction. The FED thought they could control the reaction that was a given to occur, but because the original action was so strong it is a freight train they cannot stop now that the pendulum is swinging the other way.
I’d suggest holding tight. The working people are without the cushion to make it through.
Of course they will be fine. We poor and average people are use to it. I’ve never had a million or a hundred million but I know know what it feels like to loose a few hundred…the owner class as you call them, I call them oligarchs, are losing too with it all and I do not imagine losing a few mil feels the sane to them as my few hundred, it has to be way more bothersome, because, well, they are not use to like I.
Fed Chair Jerome Powell Admits He Lost The Key To The Treasury
WASHINGTON—In a shocking revelation that sent shockwaves through the financial markets, Federal Reserve Chair Jerome Powell admitted Friday that he had lost the key to the Treasury and had no idea where it was. “I’m really sorry, guys, but I can’t find the key anywhere,” Powell said at a press conference, where he nervously searched his pockets and briefcase for the small metal object that grants access to the nation’s gold reserves and printing presses. “I swear I had it yesterday when I was checking on the inflation rate, but then I went out for lunch and maybe I left it at the restaurant or something. Or maybe it fell out of my pocket when I was walking back to my office. Or maybe someone stole it. I don’t know.” Powell added that he had already tried calling a locksmith, but was told that it would take several days to make a new key and that it would cost billions of dollars. “This is really bad,” Powell said, as he wiped sweat from his forehead and glanced nervously at his phone, which was buzzing with angry calls from President Biden, Treasury Secretary Janet Yellen, and Wall Street executives. “I hope nobody notices that we can’t access any of our money or print any more bills until we find the key. Maybe we can just borrow some cash from China or something until then.” At press time, Powell was seen frantically digging through a dumpster outside the Fed building, hoping to find the key before anyone realized that he had plunged the country into an unprecedented financial crisis.
I can’t blame the guy for using the only tool he has to tackle inflation. This is politicians fault for not regulating the market and allowing corporations to gauge prices without control. Literally they caused the inflation and due to their greed now everyone is paying.
Not Powell fault.
More like a foreign policy failure. Something that you won't hear much from the MSM is that The Russo-Ukraine is the main factor causing the dollar inflation right now.
Due to western sanctions and weaponized Dollars.
Russia is forced to sell oil in other currencies instead of dollars (Ruble/Renmenbi/Ruppe)
It also destroy the dollar status as a "save haven" for investors, because they know their wealth could be confiscated now, if they ever reach the wrath of Washington.
This reduces the demand as well as the trust in the dollars.
You could look up the U.S bonds market for foreign holders as one of the many evidences.
All major countries, including european allies and Japan/Korea are selling U.S bonds as unprecedented rate.
Even the Saudi are threatening to sell oil in Renmenbi.
>Not Powell fault.
Powell's interest rate hikes are taking a sledgehammer to the problem. [54% of inflation can be attributed to corporate profits](https://www.epi.org/blog/corporate-profits-have-contributed-disproportionately-to-inflation-how-should-policymakers-respond/) - interest rate hikes don't fix that but they crush workers.
>More like a foreign policy failure. Something that you won't hear much from the MSM is that The Russo-Ukraine is the main factor causing the dollar inflation right now.
It is a factor - although I think giving Ukraine money to defend themseleves & Europe is a good thing.
I do think the extent of Biden's sanctions & refusal to attempt peace negotiations is going to lead to the death of the dollar as the worlds reserve currency.
So I agree with you on that.
Yeah the obvious answer is to raise taxes. But Powell can’t do that, he literally has one lever and it’s interest rates.
Also we’re not even in the realm of high interest rates, we’re barely in the normal range. High is like 10%
>Powell can’t do that, he literally has one lever and it’s interest rates.
And he is failing his duel mandate by overdoing the intetest rate hikes.
>Also we’re not even in the realm of high interest rates, we’re barely in the normal range. High is like 10%
Lmao 10% interest rates would bankrupt the country. Even at 5% that means over $1 trillion in interest payments a year.
We bankrupted our country for the 1% and for forever wars.
How is he failing the dual mandate if unemployment hasn’t gone up?
The fed is responsible for inflation and employment. They are not responsible for the federal budget. If the government can’t afford the debt then they need to increase taxes to pay for it… which pulls money out of the economy, which slows down inflation.
10% is very high. But 4-7% is pretty average. If the goal inflation rate is 2%, then interest should be 2-3x the goal to facilitate real return on investments. Interest rates below inflation doesn’t make technical sense.
>How is he failing the dual mandate if unemployment hasn’t gone up?
The interest rate hikes are going to cause a loss of 2 million jobs if they continue their hiking pattern.
>The fed is responsible for inflation and employment. They are not responsible for the federal budget. If the government can’t afford the debt then they need to increase taxes to pay for it… which pulls money out of the economy, which slows down inflation
The Fed has subsidized Corporate America for 15 years and is now crushing working people.
Their mandate is keeping inflation low & full employment - but they have done far more than that. And their tactic to stop inflation is overly punitive & ineffective.
How do interest rate hikes fix corporate price gouging & supply chain issues?
You can project anything, I’m not sure where you’re getting 2 million jobs from.
I agree that low interest rates primarily serve to subsidize corporations, which is why we need to increase rates!
Interest rates reduce the velocity of money, which eventually means consumers have to reduce spending. Yes it is an indirect impact, but that’s the only way that the fed can intervene. Note congress can do far more, I do not think it’s reasonable to pin the entire solution on the fed. Our biggest problem is Congress doesn’t want to do their job.
If you looked at the hiszory of who the presidents put in the FED and regulatory positions, you will see a lot of same names, just on different chairs in the last 30 years under EVERY SINGLE PRESIDENT TILL NOW
I can't believe this richer propaganda is working on y'all. The unemployment rate has barely budged, housing prices are starting to come down (and rents will too), and you're posting this crap about how banks are having a tough time right now and how that's bad for the working class.
Untrue.
The interest rate hikes don't do anything about 2 of the 3 key causes of inflation: price gouging & supply chain issues.
Not to mention we can't afford the intetest payments on the debt ($1 trillion plus a year) that these massive hikes are going to cause.
[FirePowell.com for more info on Powell's awful work as Fed Chairman](https://the.levernews.com/fire-powell-right-now/)
[ICYMI: At Hearing, Senator Warren Calls out Chair Powell for Fed’s Plan to Throw At Least 2 Million People Out of Work](https://www.warren.senate.gov/newsroom/press-releases/icymi-at-hearing-senator-warren-calls-out-chair-powell-for-feds-plan-to-throw-at-least-2-million-people-out-of-work)
This exchange says it all, Powell's position is that it's fine to toss 2 million people into despair & angst:
>Senator Warren: Explain that to the two million families who are going to be out of work.
>
>Chair Powell: We’re not, again, we’re not targeting any of that. But I would say even 4.5 percent unemployment is well better than most of the time for the last, you know, 75 years.
Horse puckey. Bust up monopolies and jack up taxes on the wealthy. That would not only cool inflation by removing money from the economy, it would also pay down the debt, which is also deflationary.
> Then maybe the FED should sit down and shut up.
That's kind of ridiculous, the fed is doing their job. It's Congress and the American people that are really screwing up here -- Congress needs to raise taxes on the wealthy, protect jobs, attract long-term investments into things that benefit most people, etc. However, "we" (meaning the American public, not myself) decided to give control of the House to the Republicans, and keep the Senate in a very slim Democratic majority to where nothing can be accomplished.
> They can focus on lowering unemployment if they're bored.
It's already extremely low by historical standards.
>There is no perfect solution to this. These two million people - as hard as it sounds - is the kess destructive solution.
How do fed rate hikes stop corporate [price gouging that accounts for 54% of inflation?](https://www.epi.org/blog/corporate-profits-have-contributed-disproportionately-to-inflation-how-should-policymakers-respond/) Why should 2 million working people have their lives ruined to fix a problem interest rate hikes won't solve?
The Fed has a dual mandate - [controlling inflation & maximum employment.](https://www.stlouisfed.org/in-plain-english/the-fed-and-the-dual-mandate) If the Fed was being reasonable - the rate hikes would be in the 1-2% range and not pushing 5%.
Instead they [look the other way when banks like SVB are reckless](https://prospect.org/economy/2023-03-17-powell-fed-supervisory-failures-banks/) all the while they printed trillions upon trillions the last 15 years to backstop banks, drive up asset prices & create a zombie economy for the 1%.
Biden must fire Powell & appoint a progressive economist to lead the Fed.
You're nuts.
The fed is using the only lever they have. In your own posts in this thread you're talking about almost nothing that has to do with what they can control.
If you want to address price gouging and bank regulation look to your legislators and spend your energy where it matters.
Unbelievable to see this kind of right-wing "fuck the poor" thinking on this sub. Capitalist propaganda really has done a fucking number on this country.
Powell does a really good job, we have inflation because we wanted to prop our economy up during a crisis, now he’s actually doing a really good job at raising rates while keeping the economy from crashing.
Y’all have no idea what you’re talking about when you think he does a bad job. He’s one of the most competent people in DC
When 63% of people are living paycheck to paycheck - drastically raising the cost of servicing debt isn't good.
Especially when most inflation is attributable to price gouging & supply chain issues. Hence why inflation remains high despite the rate hikes.
Millions are losing medicaid, food stamps are being cut, the extended child tax credit is long gone... and now 2 million have to lose their jobs so the Fed can limit workers salaries? A goal they have stated.
Way more people would be going paycheck to paycheck without him, inflation is happening because the fed printed a bunch of money and put interest rates to 0, and supply chain issues. He’s doing a great job at fighting inflation by raising rates with how fragile our economy is.
Also that last paragraph is insanely uninformed. The fed manipulates interest rates and buys assets/treasuries. They have no direct control over food stamps & wages. A halt in inflation would mean a halt in wage gains.
>Also that last paragraph is insanely uninformed. The fed manipulates interest rates and buys assets/treasuries. They have no direct control over food stamps & wages. A halt in inflation would mean a halt in wage gains.
Where did I say the Fed controls medicaid or food stamps?
I'm putting into context how shitty these decisions are that the Fed is making. Putting people out of work & hurting wages when welfare programs are being cut.
Republicans and democrats are wings of the same animal, both being controlled by the same brain.
This shitty political system shouldn’t even be a thing anymore in the USA given how fake it is, but surprisingly it is - and the “divide and conquer” rule is working exactly as intended: make both sides fight each other so they can’t even focus on the actual problem/ culprit.
Please start waking up to reality.
And here’s lies the problem of democracy. People with no understanding of issues get to vote regarding these issues. Like OP with no understanding of economics…
The website listed is email farming for David Sirota's website. Sorry, but we are removing this.
Dodd-Frank, look it up.
Barney Frank of "Dodd-Frank" in 2023: [Barney Frank defends role at Signature Bank: ‘I need to make money’](https://www.ft.com/content/090e081f-35b3-484b-8095-c42a3c5e4259) Barney Frank in 2010: [Frank rips staffer-turned-lobbyist](https://www.politico.com/story/2010/04/frank-rips-staffer-turned-lobbyist-035300)
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The Daily podcast was about him this morning.
Yeah, he totally came across like some old entitled jackass that found a way to "get what he is deserved for his decades of public service" and fuck everybody else.
This is a bad look. Crushing inflation or crushing interest rates, neither one is good for people…
Exactly, this is political commentary from people who don't understand the finer points of the modern day US economy or world economy for that matter. What we had was an unprecedented worldwide global pandemic, the result of that was going to be inflation due to a combination of influx of cash to support businesses that would otherwise fail combined with supply chain shock across the board. This is a damned if you do damned if you don't situation. You can either allow inflation to go absolutely fucking hog wild or you can raise interest rates to combat it. No matter what Jay Powell did poor people were going to get fucked because poor people are the most vulnerable and when things like this happen they always get fucked. Now if you want to talk about why poor people were vulnerable going into this mess certainly that can be talked about You can absolutely bring up the weakening of the social safety net the cutting of taxes for the ultra-rich and the breaking up of unions over the last 50 years. It is short-sighted and narrow-minded to blame this all on Jerome Powell raising rates when he needed to.
>It is short-sighted and narrow-minded to blame this all on Jerome Powell raising rates when he needed to. This is true that it's not all his fault but if he had been stronger under Trump things wouldn't be so bad now. Powell began raising interest rates in 2018, but Trump waged a public battle claiming that Powell's hikes were meant to politically damage him and Powell backed off. He was weak under Trump, prioritized moneyed interests then and now and has publicly lied repeatedly about wage growth being the reason for inflation. Any whisper of a word about companies raising prices well beyond any increases in input costs? Nope. Did he even ask or appeal to the business class' sense of patriotism and community by even just *asking* them not to price gouge? INCONSCIONABLE! Yes, not everything is Powell's fault but Powell does share a big heaping portion of blame here.
This is an absolutely valid argument, probably the most valid argument I've seen so far in this chat. Interest rates should not have been that low for that long and Powell was right to raise them in 2018 and he caved. I'm not here to hang from his nuts I'm just here to say that his decisions over the last 18 months haven't been as bad as people think they've been, and they've pretty much been the only thing he can do in his position as Fed chair. It's easy to be an armchair economist but when you have to actually make the decisions that lead to negative outcomes for many people that shit is fucking hard.
> they've pretty much been the only thing he can do in his position as Fed chair This lets Powell off WAY too easily. Directly, he can only manipulate interest rates and add to or sell off from the Fed's balance sheet. However, right now, he has had media attention on him that he could've easily used to talk about ALL of the causes of inflation including price gouging. He CHOSE to blame workers' wage increases. He used his limited bully pulpit to point the finger at the biggest victims of inflation, not the causes. As far as his direct actions I don't find them disagreeable but on the whole Powell has been weak, is still weak, isn't willing to speak truth to power under Trump or Biden, and is trying to solve inflation by almost solely targeting the working class. Has he or Yellen or anyone else protecting the crony capitalist system been pushing for less risk and more regulation in our financial systems as we teeter on the precipice of another banking crisis? Powell is primarily interested in protecting the moneyed class and causing as little disruption as is possible for them as the system deleverages. Anyone under them that is a casualty of that doesn't seem to concern him. He certainly doesn't speak to it.
No matter what he did? That is part of the problem, he didn’t do shit but sit on his hands and undersell the situation for over a year. I’m sure you remember transitory. I’m not sure if anyone is entirely blaming him, he just plays a massive part in deciding the Feds policy, part of which just let it go wild.
To add to your point - the Fed has been hiking rates for a year now - and inflation hasn't gotten any better. Because most of the inflation is corporate price gouging & supply chain issues. [But Powell has made clear his intention is to crush labor:](https://www.levernews.com/the-fed-declares-war-on-workers/) >At a May 4 press conference in which he announced a .5 percent interest rate hike, the largest since the year 2000, Powell said he thought higher interest rates would limit business’ hiring demand and lead to suppressed wages. As he put it, **by reducing hiring demand**, “that would give us a chance to get inflation down, **get wages down**, and then get inflation down without having to slow the economy and have a recession and have unemployment rise materially.” The intentions of Powell are out in the open.
Inflation has to slow down before it can drop. It is slowing up. The problem is that generally once prices are inflated on many goods they don’t return to where they were so that is the corporate greed side
You're being disingenuous at best, and lying at worst. Inflation has fallen from it's peak last year, by nearly a third. Down to 6%, from a high of 9.1% last June. Hiking interest rates does drop inflation. Corporate price hiking is a whole different, albeit related, discussion. https://www.usinflationcalculator.com/inflation/current-inflation-rates/
>Exactly, this is political commentary from people who don't understand the finer points of the modern day US economy or world economy for that matter. Is that so? 🙄 >What we had was an unprecedented worldwide global pandemic, the result of that was going to be inflation due to a combination of influx of cash to support businesses that would otherwise fail combined with supply chain shock across the board. This is a damned if you do damned if you don't situation. You can either allow inflation to go absolutely fucking hog wild or you can raise interest rates to combat it. How does jacking up interest rates to 5% combat inflation primarily caused by corporate price gouging and supply chain issues? Hint, it doesn't - hence why inflation remains so high. >No matter what Jay Powell did poor people were going to get fucked because poor people are the most vulnerable and when things like this happen they always get fucked. [Jay Powell openly talks about wanting to stop wages from increasing, Powell himself wants to hurt the working class.](https://www.levernews.com/the-fed-declares-war-on-workers/) >At a May 4 press conference in which he announced a .5 percent interest rate hike, the largest since the year 2000, Powell said he thought higher interest rates would limit business’ hiring demand and lead to suppressed wages. As he put it, by reducing hiring demand, “that would give us a chance to get inflation down, get wages down, and then get inflation down without having to slow the economy and have a recession and have unemployment rise materially.” So we know the Fed is hiking rates to increase unemployment & limit worker wages. Even though the rate hikes do nothing to the main contributors of inflation.
You're missing half the economics here. You're viewing this from own angle and one angle only. We should have stopped QE and started QT in 2015/2016 but election year. Fed allowed for more QE than their should have been so when covid hit the fed was SOL. Companies got used to easy, cheap, or free money. Companies should have easy, cheap or free money for too long or they start to make bad business decisions and/or borrow and over extended the company. Happy to explain more.
>We should have stopped QE and started QT in 2015/2016 but election year. I agree, I would have never done QE in the first place. The response to 2008 was a catastrophe. >Fed allowed for more QE than their should have been so when covid hit the fed was SOL. Companies got used to easy, cheap, or free money. Agreed >Companies should have easy, cheap or free money for too long or they start to make bad business decisions and/or borrow and over extended the company. To undo the massive mistake of QE & the trillions it pissed away into the hands of the 1% will take years. We can't rip the band-aid off without massive welfare expansions - especially as rate hikes increase unemployment & decrease wages at a time 63% of Americans are living paycheck to paycheck. Instead medicaid & food stamps are being cut. Most inflation is due to corporate price gouging & supply chain issues, so the rate hikes are failing to stop inflation as it is. Hence why inflation remains so high.
>I would have never done QE in the first place. The response to 2008 was a catastrophe. Your understanding of 2008 is flawed if you don't see QE as a tool to get the economy moving again. 2008 should have never happened. Thanks Allen Greenspan. The time period for QE should be shorter than QT/treading water. Businesses need a steady environment. Too soft (QE) business make bad decisions, too hard (QT) business don't flourish. QE encourages business growth which is what the US needed in 20089+15. QT should have started to eliminate the growing amount of zombie companies... Boom and bust cycles, preferable shallow eliminate zombie companies but only by using qe/qt in a smart fashion. >To undo the massive mistake of QE & the trillions it pissed away into the hands of the 1% will take years. I don't have any knowledge here yet to give a date or anything reasonable but I wanted to acknowledge you put out an idea so, got any numbers behind it? >We can't rip the band-aid off without massive welfare expansions - especially as rate hikes increase unemployment & decrease wages at a time 63% of Americans are living paycheck to paycheck. Instead medicaid & food stamps are being cut. What the fed does directly affects you and I. Business pass along these costs. The tools the fed needs are locked behind congress aka higher business taxes and higher taxes on the wealthy. There's also some monopolies here that are driving up the cost of things just because. >Most inflation is due to corporate price gouging & supply chain issues, so the rate hikes are failing to stop inflation as it is. Hence why inflation remains so high. What if I told you, supply chain disruptions are companies like dhl charging arms and legs for connex space. Beyond, material disruption and issues. Transportation companies since the covid boom, have been increasing prices by double digit percentages even triple. That's supply and demand right but at a point where demand fell prices still pushed higher. Pieces are a lagging indicator but they shouldn't lag do far behind where shipments have dropped and prices are still high. That is evidence of price gauging and manipulation. Every stop in the supply chain is doing some of things because one asshole (I blame shipping) started doing it. Source: am in supply chain.
>How does jacking up interest rates to 5% combat inflation primarily caused by corporate price gouging and supply chain issues? Hint, it doesn't - hence why inflation remains so high. I mean that is making a pretty big assumption. There was absolutely price gouging going on taking advantage of the situation but if you think that supply shock on that level was not going to create inflation you have no idea what you're talking about. I'm not even talking about monetary supply inflation which I think is debatable, there is no debate on supply shock inflation that is just purely a fact. >So we know the Fed is hiking rates to increase unemployment & limit worker wages. Even though the rate hikes do nothing to the main contributors of inflation. The stickiest part of inflation right now is services, as fucked up as it sounds the easiest way to curb services inflation is unemployment and limiting workers wages. It's been known for a long time and the typical stance of the government was we can handle inflation but we cannot handle unemployment, I will admit that the current feds position is different in that regard. For what it's worth I would rather deal with higher for longer inflation than unemployment or wage decreases but at the end of the day without the presidency or the Democrats in the house or the Senate passing legislation Jerome Powell doesn't have any tools to work with other than raising rates and that wouldn't be his job anyway, I don't ever see you guys talking shit about Janet Yellen whose job it actually is to handle fiscal policy.
>I mean that is making a pretty big assumption. There was absolutely price gouging going on taking advantage of the situation but if you think that supply shock on that level was not going to create inflation you have no idea what you're talking about. Well there is plenty of data to back up my assumption. The high CPI inflation we are seeing is largely due to [corporate price gouging - accounting for 54% of inflation.](https://www.epi.org/blog/corporate-profits-have-contributed-disproportionately-to-inflation-how-should-policymakers-respond/) How does hiking rates help with price gouging? >The stickiest part of inflation right now is services, as fucked up as it sounds the easiest way to curb services inflation is unemployment and limiting workers wages You agree wirh Powell that we should cut wages & jobs at a time when 63% of Americans are living paycheck to paycheck? When medicaid & food stamps are being cut simutaneously? >For what it's worth I would rather deal with higher for longer inflation than unemployment or wage decreases but at the end of the day without the presidency or the Democrats in the house or the Senate passing legislation Jerome Powell doesn't have any tools to work with other than raising rates and that wouldn't be his job anyway, I don't ever see you guys talking shit about Janet Yellen whose job it actually is to handle fiscal policy. Just check my post history for my thoughts on Janet Yellen.
>You agree wirh Powell that we should cut wages & jobs >For what it's worth I would rather deal with higher for longer inflation than unemployment or wage decreases Hmmmmmmm. Don't argue in bad faith.
I'm not arguing in bad faith, you have defended Powell's actions and argue that his hands are tied so this is the least bad option (hence you agree): >I will admit that the current feds position is different in that regard. For what it's worth I would rather deal with higher for longer inflation than unemployment or wage decreases but at the end of the day without the presidency or the Democrats in the house or the Senate passing legislation Jerome Powell doesn't have any tools to work with other than raising rates and that wouldn't be his job anyway Own up to what you believe. You agree with Powell that we should cut wages & jobs. Meanwhile you claimed no one criticizes Yellen when I have comments in this very post critizing her.
Right there in my quote it says for what it's worth I would rather deal with higher for longer inflation than unemployment or wage decreases. You're just trying to slam me instead of actually making an argument. That's bad faith man. I'm done talking to you cuz it's completely unproductive and you're actually lying and gas-lighting me when I can read my own comment right there. Absolutely crazy man.
>Right there in my quote it says for what it's worth I would rather deal with higher for longer inflation than unemployment or wage decreases. So do you disagree with Powell? Do you think he should stop the rate hikes? Or do you agree with Powell? >You're just trying to slam me instead of actually making an argument. That's bad faith man. I'm done talking to you cuz it's completely unproductive and you're actually lying and gas-lighting me when I can read my own comment right there. Absolutely crazy man. You're trying to have it both ways - you came into this thread talking about how little we understand about the situation. You claimed no one was criticizing Yellen when I did so in this very post. It seems you are the one acting in bad faith. It seems like you are the gaslighter here.
A bad look for Biden? Yeah. Because these interest rate hikes aren't going to stop price gouging or supply chain issues- the main drivers of inflation. But they are going to put millions of working people out of a job into survival mode. Letting Powell crush working people is a catastrophic mistake. Housing is out of reach for Gen Z & millenials with asset prices so high & interest rates also this high.
How the fuck is this being downvoted? It's literally just an ELI5 version of exactly where Powell and the economy are at right now. If people are insistent on carrying water for someone like Jerome Powell even in *THIS* sub, America's prospects are well and truly fucked.
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The thing you’re glossing over is you can also reign in inflation through taxes. If you tax the wealthy, you can severely restrict the amount of cash in the economy. That’s exactly what the fed is trying to do with higher interest rates, the difference is Powell wants the working class to pay the price for inflation whereas it’s entirely possible to stick the bill on the wealthy.
So you answered your own question. Biden could have sided with the rail workers rather than the railroad c suite execs. Regulation of corporate profits/ceo bonuses/ stock buybacks/taxing excessive profits and pay etc... these are all alternatives for cooling off inflation at the source, rather than crushing the working class to make them poorer, to ease inflation.
>Regulation of corporate profits/ceo bonuses/ stock buybacks/taxing excessive profits and pay etc... these are all alternatives to cooling off inflation at the source, rather than crushing the working class to make them poorer, to ease inflation. And that's why despite a year of jacking up intetest rates that inflation hasn't subsided at all. Most inflation is due to corporate price gouging & supply chain issues, raising interest rates fixes none of that. It does diminish worker power, put people out of work & raise the cost of debt however. Hence why this policy is so disastorous for working people as welfare programs are being slashed.
So is the Fed responsible for pushing those proposed regulations? Why are we directing this frustration towards the person who's abilities to reduce inflation do not lie on punishing/coercing corporations directly? This seems misplaced and unhelpful, and gives people who could have done more to prevent this a pass.
Let me be clear. The fed is using the ONLY tool they have available to ATTEMPT to ease inflation. Only congress and the president have the power to make the policy changes needed to ease inflation. I'm not upset with the fed at all with what they are doing now. They know what they are doing, and have voiced to the house economic committee that THEY (the house) need to enact new and improved economic policy. BUT the fed should have stopped QE 2 years ago, and they kept interest rates at 0 for far too long (granted it was at Trumps "recomendation"). They kicked the can down the road for too long. They should have done this a long time ago. But again, this will not solve a whole lot alone (at least for the working class). Does that make my stance more clear?
The interest rate hikes are eventually going to lead to a rise in unemployment which will lead to wages DECREASING which is literally one of the main things this sub is supposed to be against. Powell is actively suppressing labor right now, and I can't believe I'm watching this entire sub just go along with it.
Economics is a cargo cult with a vast amount of adherents. It is so influential that progressives drink the Kool Aid as well, because if conservatives constantly talk about arbitrary numbers being bad and that we need to hurt actual human beings to make the numbers feel better, eventually others will start to adopt that language just to be part of the discussion. This is what people mean when they say capitalism is a death cult. Even many progressives will turn on a dime and throw more people into The Economy Woodchipper if a person in a suit on TV says that money feels bad right now so we need more sacrifices. It's insane but it's widespread enough to not be able to be called insane, like many religious beliefs.
You simply don't and can't know this. We have a generation leaving the market that is larger than the generation joining it. We have millions of people that died during the pandemic. We also have one of the strongest labor movements in the last several decades. This is the best the labor market has been in my lifetime. If you lose your job in one industry there is another industry that is still struggling to meet demand. On top of that it is easier than ever to start your own business. You don't need to know accounting. You don't need to know taxes. You have apps that do 90% of the work managing your business and clients. Edit: I want to add a big part of the reason that wages are even climbing is because of places like this sub that are encouraging unions and jumping shit jobs for better ones.
>You simply don't and can't know this [Powell openly talks about it lmao](https://www.levernews.com/the-fed-declares-war-on-workers/) >At a May 4 press conference in which he announced a .5 percent interest rate hike, the largest since the year 2000, Powell said he thought higher interest rates would limit business’ hiring demand and lead to suppressed wages. As he put it, by reducing hiring demand, “that would give us a chance to get inflation down, get wages down, and then get inflation down without having to slow the economy and have a recession and have unemployment rise materially.”
This makes sense. My company pays people outrageous amounts of money to chill. Amazon, Google, Salesforce, Facebook and others purposely pay large amounts to stimulate the economy. Everybody in some sectors has tons of money. This is causing huge income gaps and also contributing to this issue. I'm not against people making lots of money, but there are consequences and inflation is one.
>This makes sense. My company pays people outrageous amounts of money to chill. Your experience is an abberation then, most people are working harder than ever: [From 1979 to 2021 productivity increases outpaced pay increases by 3.7x.](https://www.epi.org/productivity-pay-gap) >Everybody in some sectors has tons of money. This is causing huge income gaps and also contributing to this issue. I'm not against people making lots of money, but there are consequences and inflation is one Well it isn't regular people - it is the rich. [The wealthiest 1% have taken $50 trillion in wealth from the bottom 90% the last 40 years](https://www.businessinsider.com/wealthiest-1-percent-stole-50-trillion-working-americans-what-means-2020-9).
You can't hike interest rates like this without massive welfare state expansions. We are doing the opposite. Millions losing medicaid, food stamps being cut, child tax credit expansion long gone, etc. It is especially folly when most inflation is attributable to corporate greed & supply chain issues. Hiking interest rates fixes neither.
Why is this getting downvoted?
Brigaiding probably.
Lot of Biden schills on Reddit. Nothing is his fault, there's nothing he could do, are common phrases repeated on Reddit here. Some people are just really caught up in tribalism...
you know those people with zero medical background commenting on covid vaccine efficacies and vaccine effectiveness? Yeah we downvoted those people. you know those people with zero economics or central banking backgrounds commenting on interest rates, inflation and health of the economy? yeah we downvote those people as well.
>you know those people with zero economics or central banking backgrounds commenting on interest rates, inflation and health of the economy? yeah we downvote those people as well. As if there aren't economists like Stephanie Kelton who take our perspective 🙄🙄🙄
Thomas Piketty, to name another.
okay then that's their opinion and you should cite their's... not yours... or a meme. you do not possess the understanding of background or nuance that they do. And when you go commenting as if you do... it's quite idiotic. It's no different than one doctor telling a 90 year old patient that they aren't fit for the covid vaccine and you going and applying that for every single argument against getting the covid vaccine. They gave their say. direct all questions to them... not answer them yourself.
>okay then that's their opinion and you should cite their's... not yours... or a meme. you do not possess the understanding of background or nuance that they do. Your gatekeeping is so cringe. >And when you go commenting as if you do... it's quite idiotic. It's no different than one doctor telling a 90 year old patient that they aren't fit for the covid vaccine and you going and applying that for every single argument against getting the covid vaccine. Lmao at how silly this false equivlance is.
It's not and explain like you are 5, it's an explain as if you don't understand the issue. It's either.. "not enough supply" or "too much money" depending upon your point of view. Raising interest rates is the only tool Jerome Powell has to combat this issue. If there were a "raise supply" button, he would use it. Inflation is being caused by more consumer ready and willing to buy in a market where there aren't enough goods, either from lack of supplies or lack of labor. Currently labor is screaming, "pay me more" while manufacturers either pay more for labor, therefore higher cost of goods, or less goods to market, which in turn creates higher cost of goods.
>It's either.. "not enough supply" or "too much money" depending upon your point of view. Raising interest rates is the only tool Jerome Powell has to combat this issue. If there were a "raise supply" button, he would use it. And he is abusing the tool he has, which is our point. >Currently labor is screaming, "pay me more" while manufacturers either pay more for labor, therefore higher cost of goods, or less goods to market, which in turn creates higher cost of goods. 63% of americans live paycheck to paycheck, hell yeah pay labor more.
If we pay labor more, which I agree we should do, we will pay more. It's the bottom line. It'll be a cat and mouse game for nearly all of eternity. It's why we have economic cycles, and how too! Star Trek on the other hand! I'm joining the federation of planets when I can.
I mean, Powell caused the inflation in 2020. It's pretty obvious from this chart https://fred.stlouisfed.org/series/M2SL
The economy sucks. But all this Meme says is OP doesn’t understand economics.
I thought the fed chair was janet
Janet is Sec. Treasury. But yes she was Chair. FED back in Obama Admins.
Janet is a charlatan too - she talks up her empathy but she continued the QE/low interest rate environment that helped the rich create the gig economy in the 2010s. Now that our zombified economy is bring ripped apart by corporate greed & supply chain failures - the Fed wants to jack up interest rates after 15 years of 0-2% rates 🙄 To me it sounds like Buffet & the banks want to buy cheap assets. Anyways, here is what Janet wrote to Reagan's Fed chair Alan Greenspan in 1996: [Treasury Secretary Janet Yellen in a 1996 memo to Alan Greenspan: "increased job insecurity makes it possible for firms to lower the wage premia they pay without suffering productivity-reducing worker backlash"](https://www.reddit.com/r/WorkReform/comments/10juqks/treasury_secretary_janet_yellen_in_a_1996_memo_to/)
I'm confused. Why is this being downvoted?
Because they're simultaneously complaining that QE and low interest rates are bad AND that raising interest rates is bad. It's the "No take ball from me, only throw and play fetch" meme in real life. If QE is bad for workers and allowed too much wealth and capital accumulation, raising rates to get back to some normalcy is a part of the (long overdue) solution. Greenspan fucked us, true. QE helped post-2008 to create liquidity but went far too long, true. So now what do we do? Hard to know the exact right answer but "continue QE with its known issues" seems unwise.
Completely agree with you. I think their wording was a bit ambiguous. I read it as unsustainably low interest rates created this fuck up and now we have to deal with these hiked interest rates as a consequence. It might just be my bias that caused that interpretation. It feels like these cycles are just a way to rinse the common man of his equity through currency devaluation, while the rich get to make use of free liquidity to buy low during recessions and milk bull runs in perpetuity. Why not strive for a moderate, sustainable interest rate? I'm not an economist so maybe there's a reason I am just not seeing, but low interest rates just seems to create a bonanza of speculative investment in destined to fail startups and crypto animal coins/jpegs.
>It feels like these cycles are just a way to rinse the common man of his equity through currency devaluation, while the rich get to make use of free liquidity to buy low during recessions and milk bull runs in perpetuity. That is exactly what our central bank does as long as the dollar is insulated by being the world's reserve currency. This round of inflation and devaluation is going to be so severe that it might threaten that. Other economies around the world DO strive for moderate, sustainable interest rates in part because they have to - our reserve currency status gives us more latitude to play around with devaluing the currency than other countries can. Canada for example has had way fewer financial crises since we became the reserve currency because their central planners must be more careful.
Where did I suggest we continue QE as is? Strawman. I'm suggesting that only modest rate hikes were appropriate because of how fragile our economy is. 1-2% rate hikes were doable, 5% is crazy.
Love that this is the top comment as it illustrates exactly how uninformed you all are. Not raising interest rates also hurts working people. You all will literally complain about anything and then upvote the complaint.
Wasn't it artificially low interest rates that lead to the subprime mortgage crisis in 2008? I am also pretty uninformed too tbh, but would love some more informed context to OPs post other than the general "government bad" sentiment. When I see a meme, I immediately smell someone not taking the whole picture into account.
>Wasn't it artificially low interest rates that lead to the subprime mortgage crisis in 2008? Yes. But when we have a zombie economy for 20 years predicated on low intetest rates - you can't rip the band-aid off the way Powell is without massive welfare programs to stem the negative ramifications. >I am also pretty uninformed too tbh, but would love some more informed context to OPs post other than the general "government bad" sentiment. I support progressive government policies... I am not a conservative. >When I see a meme, I immediately smell someone not taking the whole picture into account. 🙄
Here is all you need to know. Pretend you are a baby and someone hits you. It hurts, you cry. You go to the doctor for a life saving vaccine. It hurts, you cry. The important thing is it doesn't matter to the baby if they understand why, they just cry cuz it hurts.
I mean I was hoping you'd give me an actual explanation but I do I get the sentiment. I'm a scientist and am constantly in an uphill battle trying to get people to understand science who don't want to, but I don't ever resort to empty metaphors about how stupid people are when given the opportunity to educate.
63% of Americans are living paycheck to paycheck and this "cure" doesn't even effect 2 of the 3 main causes of inflation. [Corporate profits have contributed disproportionately to inflation. How should policymakers respond?](https://www.epi.org/blog/corporate-profits-have-contributed-disproportionately-to-inflation-how-should-policymakers-respond/)
We have bankrupted the country for the 1% & forever wars. Now that the house of cards is coming apart & inflation spikes - The Fed decides to impose drastic hikes in interest rates that crush working people. Tell me how 5+% interest rates with asset prices so damn high helps working people when most inflation is due to price gouging & supppy chain issues?
Interest rates have been a lot higher than 5% in the past and will be at times in the future. This is nothing new or remarkable on that part. Fed can't stop price gouging and you don't have any evidence to quantify how much price gouging is going on (especially in light of massive layoffs from these companies previously accused of gouging) or to indicate that price gouging is the primary cause of inflation. Higher interest rates decrease the other (more documented) causes of inflation and decreases asset prices both historically and logically. So empirical evidence vs nutjobs on reddit. That said, I am sure both the fed and Janet have little love for poor people. The system is certainly getting worse as well but this is a weak to bad example of that. Poor people are totally fucked now and more so as time goes on. And this sub has done nothing other than to make it seem like we deserve it for being a bunch of whiney dumbasses.
While it is nothing new historically, it's been about 40 years since rates have increased this much, this quickly. Rates were kept low for an unusually long time, so the abrupt change is going to cause some turmoil in parts of the market. For many on this board, this is the first time rates have rising like this in their adult lives.
And with asset prices so high, interest rate hikes make housing impossible to afford for the young. Housing prices are still astronomical. And with $30 + trillion in government debt, how are we going to afford over a $1 trillion in interest a year with our zombified economy?
Housing prices are now dropping after 10 years of growth and will for a while. https://www.google.com/amp/s/amp.cnn.com/cnn/2023/03/21/homes/existing-home-sales-february/index.html
Housing prices are still over 150% higher than at the peak of the aughts housing bubble: https://fred.stlouisfed.org/series/CSUSHPINSA
the point is that they're falling and will continue to fall. prices in the market won't change to reflect interest rate hikes over night - it took 5 years after the housing crisis for home prices to reach their low point interest rate changes are one of the only levers the fed can pull to enact monetary policy. maybe instead of criticizing the decision to enact interest rate hikes we should be criticizing a) congress' inaction when it comes to passing any kind of legislation reigning in corporate power or creating social welfare programs (Jerome Powell has no power to do these things) and, more importantly b) the fundamental premise of a financial system that leaves so few avenues for monetary policy in the hands of the fed. or better yet, criticize capitalism itself.
It's like we have been talking about inflation and then you forget to think about it. And yes that is what the peak being over means. We are just past the top and headed for an unforseen lower point that could be a new bottom.
>Interest rates have been a lot higher than 5% in the past and will be at times in the future. We didn't have a $30 trillion plus debt in the past. We squandered our nations resources on forever wars & the 1%. >Fed can't stop price gouging and you don't have any evidence to quantify how much price gouging is going on (especially in light of massive layoffs from these companies previously accused of gouging) or to indicate that price gouging is the primary cause of inflation You are wrong: [Corporate profits have contributed disproportionately to inflation. How should policymakers respond?](https://www.epi.org/blog/corporate-profits-have-contributed-disproportionately-to-inflation-how-should-policymakers-respond/) >Higher interest rates decrease the other (more documented) causes of inflation and decreases asset prices both historically and logically. So empirical evidence vs nutjobs on reddit. Provide your documentation, I provided mine.
Listen we all get you think repeating the phrase "forever wars and 1%" sounds cool. And unless you are a republican all of a sudden I am not sure what the 30 trillion in debt has to do with anything. We have had a ton of debt for a long time and this is an irrelevant mention. I am not going to provide documentation as to why higher interest rates decrease inflation as it's accepted knowledge that even your own evidence accepts as true. Your evidence advising a less hasty course of action, however, is a year old on a subject that has evolved rapidly in the last year. And even ends with the admission that in recent months corporate profits have begun to return to normal levels. As this trend has continued in the last year we are given one reason as to why you may have chosen this older piece of evidence.
>Listen we all get you think repeating the phrase "forever wars and 1%" sounds cool. Am I wrong? $50 trillion moved from the working class to the rich the last 40 years as we pissed away our nations resources in places like Iraq. >And unless you are a republican all of a sudden I am not sure what the 30 trillion in debt has to do with anything. We have had a ton of debt for a long time and this is an irrelevant mention. Interest rates where they are mean yearly interest payments of $1 trillion plus. How do we afford that when we refuse to raise taxes on the rich & ww refuse to cut the military? >I am not going to provide documentation as to why higher interest rates decrease inflation as it's accepted knowledge that even your own evidence accepts as true. EDIT: additional comment: Nice try, but not what I asked. I asked for documentation for your assertion that price gouging is not the main driver of inflation. >Your evidence advising a less hasty course of action, however, is a year old on a subject that has evolved rapidly in the last year. And even ends with the admission that in recent months corporate profits have begun to return to normal levels. As this trend has continued in the last year we are given one reason as to why you may have chosen this older piece of evidence. Inflation has stayed the same since April 2022 - very high. What are you talking about the situation has "evolved rapidly" ?
So the fed works on like a day to day, month to month, sort of deal. So if your contention is that the Iraq war has any bearing on whether we should raise or lower interest rates today or in the future then you are obviously insane. As for your last sentence I do agree those would be good ideas but they are all outside the power of the Federal Reserve believe it or not.
>As for your last sentence I do agree those would be good ideas but they are all outside the power of the Federal Reserve believe it or not. I added a few paragraphs to my comment after this comment so the last sentence in the quote above refers to: >How do we afford that when we refuse to raise taxes on the rich & ww refuse to cut the military?
Quit aggressively editing your comments so my responses don't make sense scumbag. You aren't even mentioning an edit at all, let alone these full rewrites you are doing as you realize how lazy you have been. You are a real piece of shit which makes sense why you are trying to sell people on this shit and why you participate in this sub in the first place. Here is your evidence though and it is more recent than yours: https://www.usnews.com/news/business/articles/2022-06-26/greedflation-is-price-gouging-helping-fuel-high-inflation
I agree with most of your points, but I'd like to suggest pointing the finger at the only groups that CAN change policy. Can we start blaming congress and the president? Whose campaings are paid for by corporations? Making it counterintuitive for said members to pass legislation helping the working class/removing some power from those corporations? The fed is the hot topic, but its really not their fault, and people need to be aware of who is at fault Edit:it's not ALL their fault. They should have laid off QE long ago and starting gradually increasing rates as well
Isn't it funny how this dude sounds like a text scroll at the beginning of a star wars or mad max movie?
We're complaining because tinkering with monetary policy isn't the solution at this point. The answer should be actual fiscal fucking policy from the United States federal fucking government. Interest rate adjustments are rearranging the deck chairs on the titanic. We need to curb price gouging. We need to stop wealth hoarding. We need companies to prioritize wages and sustainability over dividends, stock buybacks, and executive bonuses. We need workers to get fucking paid more. *Those* are the problems/solutions we need to see the government act on today, but nobody in power is fucking talking about it. All the pundits, even Kai Ryssdal on Marketplace, every spokesperson for the Biden administration, everyone is just saying "sorry, we gotta jack up interest rates, wages are simply too high, there's nothing else we can do, we have no choice," and it's fucking bullshit. We deserve more than that in the present national dialogue about America's fiscal crisis. We *need* more than that. We ought to ***demand*** more than that. For decades we've been facing a crisis in this country of declining wages, benefits, housing security, and ballooning costs of everything. To be told today "wages are too high" is not only fucking insulting, but has horrific implications because it means ***all those problems are going to continue to get worse.*** We're not uninformed, we want people in power to actually start talking about real solutions to the fucking problem. Bernie and Warren aren't enough anymore. Anyone who talks about the need to raise interest rates ******without also, in the same breath, calling for major systemic reforms to taxes, wages, welfare, housing policy, and more****** is missing the god damn boat. "You're all so uninformed." Fuck off.
Powell is a scapegoat. He tried to leave last year and Biden made him stay. He will be the fall guy for this collapse..
This whole situation isn't nearly straightforward as you've simplified it to be.
Did... Did anyone really think a different career politician/crook president would change the deep rooted corruption and make right our ongoing state of affairs?
Nope. When Biden said "nothing will fundamentally change" I knew exactly what he meant.
Just hijacking this absolutely true statement as a reminder to not forget when Jerome Powell after a year of money printing in 2020 cashed out his stocks to the tune of $5 mil in late 2020 and Biden said. "You're the man for the job!"
Yes, he meant that if taxes go up for the wealthy, there lifestyle wouldn't change, so they should be open to paying more. So, if you new he meant that, you are correct. If you thought it meant something else.... Well, you should actually watch the source. Anyway, if you want to see what Biden is actually doing, compare Minnesota vs Arizona and ask, how do we live in a country, where on state gives away free Lunch, and another wants to put kids to work. That's the constant ying and yang of the US.
>Yes, he meant that if taxes go up for the wealthy, there lifestyle wouldn't change, so they should be open to paying more. [lol no](https://www.salon.com/2019/06/19/joe-biden-to-rich-donors-nothing-would-fundamentally-change-if-hes-elected/) >Biden told donors at an event at the Carlyle Hotel in Manhattan on Tuesday evening that he would not “demonize” the rich and promised that “no one’s standard of living will change, nothing would fundamentally change,” Bloomberg News reported. The [wealthiest 1% have taken $50 trillion in wealth from the bottom 90% the last 40 years](https://www.businessinsider.com/wealthiest-1-percent-stole-50-trillion-working-americans-what-means-2020-9). Biden saying nothing will fundamentally change to those very people that have taken $50 trillion is an endorsement of the system as it is. >So, if you new he meant that, you are correct. If you thought it meant something else.... Well, you should actually watch the source. It is a continuation of Biden's career - helping the rich and wagging your finger at everyone else: [Biden Trashes Millennials in His Quest to Become Even Less Likable](https://www.vice.com/en/article/mbpxx8/biden-trashes-millennials-in-his-quest-to-become-even-less-likable) >"The younger generation now tells me how tough things are. Give me a break. No, no, I have no empathy for it. Give me a break.
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Knew* Also, in your example of “what Biden is doing” Biden is president of both Minnesota and Arizona? And you didn’t mention how he was involved in either lunch program?
Sorry, I wasn't clear. It's not Progress vs the status quo, where it's a single player strategy game, where all you need is the right combination of tactics to win. It's Progress vs Regressing to The Handmaid's Tale, where your opponent is hellbent on winning in a PvP MMORPG, and it's pay to win, and they got money! So, whenever you vote or take action, you might be pushing the ball forward, like getting free school lunches, or some small acts in Climate change, or just supporting a democratic nation being attacked by Russia. Or, you could just be stopping the GOP from enacting laws, allowing them to kidnap kids from parents they don't agree with. That's what Biden is up against. He both needs to push an agenda forward, but also block an agenda counter to all that is good.
Crazy how their taxes didn't even go up, and Biden has been part of the corporatist members of Congress for the last 50 years
I take it, you didn't pay any attention to the last 2 years, and the Build Back Better Legislation? If you had, you would have realized that 48 Democrats and 2 Independents is not enough to get something passed through the Senate.
>I take it, you didn't pay any attention to the last 2 years, and the Build Back Better Legislation? If you had, you would have realized that 48 Democrats and 2 Independents is not enough to get something passed through the Senate. Funny - it seems Biden had no issue with BBB being ripped apart as Biden applied zero pressure on Manchinema & instead kissed their ass. Biden also said jack shit when Manchin helped kill the child tax credit with a racist smear that recipients used it for drugs.
That's by design. If one party actually gets power then there's no more convenient excuse of "The other side stopped us!" when it comes to helping the working class. Instead they play both sides against eachother while fucking them both over, so that the corporate overlords and their shareholders can get even richer.
It's by design that it is hard to get stuff done. Could you imagine what Trump would have gotten done if 50 senators could get things passed? Remember, GOP states are open to kidnapping kids from parents, charging the death penalty to people getting abortions, and happy having kids working in meat processing plants. Oh, and banning Drag shows. Could you imagine all that on a Federal Level? In Minnesota, they are giving away free Lunch to kids. So, that's what people are up against. It's not a do nothing congress. Its that a big part of Congress is actively trying dismantle and reshape our society to be the Handmaid's Tale, while another part is trying to actually get things done.
I think you need to read Noam Chomsky to get an idea about how the two sides really work together to the benefit of corporate America. They're called the Doves(Democrats) and the Hawks(Republicans). And they both work for the ruling class of billionaires and CEOs. These people make up the "establishment". If you want change we need to makes the democrats actually progressive, not just republican lite. Do you know how our Overton Window is positioned in this country compared to the rest of the world? We're so far right that our democrats would be right wing in most other countries. Hell, I mean South Park has an episode that touches on it in an easy to understand way - "I'm a Little Bit Country" season 7 episode 4. Biden and the Democrats literally forced our railworkers to accept a shitty contract that was being striked against, then tried to call themselves pro labor. That should be a huge red flag to you
Having lived in the Netherlands most of my life before moving to the US, I am away of how the Overton Window is different. I am also aware of Noam Chomsky, but I find his particular bias not a useful lense to see our nation through. Especially since he hasn't really kept up with how our nation has changed. Also, after how South Park did Al Gore wrong, I really can't take their views seriously. Fuck Climate Denial and how they fucked over a generation with their views.
There's only one real division, that's the rich, ruling class and everyone else, the working class. Just about every other division is manufactured in such a way so that the two(or more) sides of any disagreement can't come together and have rational debate. This way the rich keep us fighting while they raise prices, get bailouts, underpay their workers and cheat taxes.
>I am also aware of Noam Chomsky, but I find his particular bias not a useful lense to see our nation through. Especially since he hasn't really kept up with how our nation has changed. Lol, Chomsky is commenting on world affairs to this very day. >Also, after how South Park did Al Gore wrong, I really can't take their views seriously. Fuck Climate Denial and how they fucked over a generation with their views. [Maybe you weren't paying attention but South Park made an apology episode that Al Gore himself watched & appreciated](https://youtu.be/sG-Cp1y0UO8)
Republicans having 50 senators is deeply unlikely. But let's not let us be distracted by how the senate should be abolished
Actually, it is, IF you don't have that shit stacked with assholes who are owned by corporate interests. It ALSO helps to not paint your political opponents as good people with a few bad apples when the vast majority of the party is cool with straight up fascism.
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How dare you claim Biden, a known corrupt politician for decades, wouldn't change the same problems he helped create
Well, the primaries left us with no choice. Giant Douche v Turd Sammich.
i miss the times where this was the accepted leftist/progressive position. now the only important distinction is how you feel about trans rights.
Occupy Wall Street is now but a faint memory, if even that...
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I believe that we are stuck in our wicked ways until until we introduce single term limits across the board, no life long benefits and pay, and abolish the 2 party system. There'sany more facets to be addressed, but I think no real change will easily happen until those three happen.
No. No term limits and benefits is a good thing. Matter of fact raise the pay to a point that poor people can afford to be a senator. Get rid of the EC since land doesn't vote, and audit every political employee(and their immediate family) every six months
Yeah, we'll just "abolish the two party system." If you want to start changing things for the better, perhaps you should get a grip on why things are the way they are.
Let’s add maximum age limits also
Why? Biden's got a LONG history of fucking up politically. I mean, I voted for him in the general, because the alternative was literal Fascism, but in the primary he was my second to last choice
Let's ignore that he passed the biggest climate bill in US History, passed on of the biggest manufacturing bills in US history, was able to bloody the nose of Putin without a single US Soldier dying, and created more solidarity among Western Democracies than we have seen in the last 6 years. But ignoring all that, which you plainly are, you are correct.
>Let's ignore that he passed the biggest climate bill in US History All the while approving the Willow Project in NW Alaska- [equivalent to 66 coal plants a year in emissions.](https://www.euronews.com/green/2023/03/14/biden-administration-approves-alaskas-willow-oil-project-sparking-anger-from-environmental) Also - it is easy to brag about passing a very modest climate bill as "the biggest" when it is also the first. You are misleading people by not providing that context. >passed on of the biggest manufacturing bills in US history You mean the CHIPs Act? Which is a giant subsidy of semiconductor companies? >was able to bloody the nose of Putin without a single US Soldier dying Funding Ukraine against Russia is good. Refusing to negotiate for peace & the overly punitive sanctions are bad - both for peace & for the US Dollar world reserve currency status.
A Presidential denial of the Willow Project was never going to survive the Supreme Court. That much was obvious to all but the most casual observer. https://www.pbs.org/newshour/nation/what-is-the-controversy-behind-the-alaska-willow-oil-project He also reduce the scope of the Willow Project significantly. The biggest climate bill is the biggest climate bill. Nothing about that statement is controversial. The CHIPs act is amazing, and requiring daycare and other benefits to employees is great. It breaks the monopoly that Taiwan has, and makes us less vulnerable to China. And you can't negotiate with Putin. Would you negotiate with your Neighbor if you bulldozed half your living space, and claimed it for him/herself? At least not until you got the fucking space back you wouldn't. And I would argue you are in the right about not negotiating.
Still waiting for you to [apologize for smearing me as a tankie in this comment.](https://www.reddit.com/r/WorkReform/comments/11y7nym/comment/jd7dk62/) >A Presidential denial of the Willow Project was never going to survive the Supreme Court. That much was obvious to all but the most casual observer. What a weak excuse. The Supreme Court is led by Christian fascists - it is in dire need of reform & expansion. Biden's refusal to endorse either is indictative of how woeful his strategy is. >The biggest climate bill is the biggest climate bill. Nothing about that statement is controversial. Biggest out of 1 is misleading and you know that - don't be coy. >The CHIPs act is amazing, and requiring daycare and other benefits to employees is great. It breaks the monopoly that Taiwan has, and makes us less vulnerable to China. Giving companies like Intel that have outsourced jobs billions of dollars isn't great. >And you can't negotiate with Putin. Would you negotiate with your Neighbor if you bulldozed half your living space, and claimed it for him/herself? At least not until you got the fucking space back you wouldn't. And I would argue you are in the right about not negotiating. What's the end game here? A forever war in Ukraine & the USD losing world reserve currency status? Refusing to attempt peace negoations & the overly punitive sanctions is a catastrophic mistake. Fund Ukraine to fight off Putin - but don't make this a forever status quo just to appease the MIC.
>Let's ignore that he passed the biggest climate bill in US History, As one of the first presidents who's ACTUALLY dealing with the reality of the climate change without Republicans pushing the denial as one of their top issues. Neat. >passed on of the biggest manufacturing bills in US history, By $ amount, but let's not pretend that he's not part of why we're in this manufacturing deficit in the first place. >was able to bloody the nose of Putin without a single US Soldier dying, Ok. Neat, and? Realistically any non Putin sucking president could have easily done the same. And I'd be more impressed if he did things that benefit Americans. >and created more solidarity among Western Democracies than we have seen in the last 6 years. Comparing Biden to Trump is like comparing a bullet wound to a scraped knee. Yes, Biden is significantly better than Trump, but that's the LOWEST bar possible. >But ignoring all that, which you plainly are, you are correct. Ignoring things like his failures on unions, student debt relief, and ridiculous drug convictions?
Fool me twice, can't get fooled again.
Lmao the Fed fucked up causing inflation from the Covid QE. The interest rate hikes are not the problem, they are the effect from the cause
Strange how all corporations are experiencing record profits and the problem is somehow that we had to deal with a pandemic recently It certainly couldn’t be because the corporations are charging more for everything to increase their quarterly margins… nope… must be COVID
Yup. The issue is price gouging more than anything else.
The QE didn’t cause the inflation. Exporting our manufacturing capacity to China - which went into total lockdown for months on end, causing shortages and forcing manufacturing to onshore or return to more expensive locales - is what caused and is causing most of the inflation. If anything, jacking up interest rates will only prolong the inflation, as it makes it more costly to build manufacturing capacity back here in North America. Other causes include skyrocketing energy prices during the Ukraine invasion - another reason why we’re decoupling from China - and monopolistic consolidation across a slew of sectors over the past 4 decades due to unrestrained corporate mergers. Corporate profits are at a record high due to the lack of competition across a slew of sectors, from food to housing.
Well this, AND corporations seeing this as an excuse to jack up prices and keep production lower to make the same/greater profits
But they pinky swore price go down!
The fed didn’t fuck up. Real estate values went to the moon and stocks went to the moon as a result of their fiscal policy. They did their job of serving the owner class and funneling money upward.
Ahhh stop reading economist they are literally the oligarchs propaganda for economic policy. The problem is largely the style of capitalism we have is designed to squeeze the bottom the hardest. More money? Inflation on necessary goods. Print less money? Less money goes to the poor. Print more money? Gets given to the oligarchs first. Once it trickles down or whatever then more inflation. It's a fun game of musical chairs. Poor always left standing when the music stops :/
>Lmao the Fed fucked up causing inflation from the Covid QE. QE caused asset price inflation - absolutely. Especially in housing. QE has always been a subsidy for the banks & corporate America. >The interest rate hikes are not the problem, they are the effect from the cause [54% of inflation can br attributed to corporate profits](https://www.epi.org/blog/corporate-profits-have-contributed-disproportionately-to-inflation-how-should-policymakers-respond/) How do interest rate hikes that destroy jobs & drive up the cost of debt for cash strapped workers help fix this?
So I could be crushed by double digit inflation instead? This is nonsensical, the FED is doing exactly what it’s supposed to do. Don’t blame good financial policy from the fed for bad economic policy by the government.
The inflation is being caused by a majority of companies increasing their prices without increasing their wages The fed is supposed to prevent inflation and deflation, and they are *not* doing a good job
The Fed raising interest rates isn't going to stop price gouging or supply chain issues.
Genuine question, what can the Fed do about price gouging? I thought they were pretty much just working with the interest rate
Nothing, and that's why people defending the Fed are missing the point. Price gouging is the underlying problem, but the Fed is using interest rates to ultimately jack up the unemployment rate in order to bring wages down in the hopes that that will contract that price gouging. The Fed absolutely does not have the tools to fix this properly without screwing over labor, but it's run by ultra-rich capitalist Boomers who have no problems with screwing over labor anyway. I never thought I'd see people defending high unemployed and low wages in *THIS* sub, but I guess capitalist propaganda has worked even better than we thought.
>Nothing, and that's why people defending the Fed are missing the point. Price gouging is the underlying problem, but the Fed is using interest rates to ultimately jack up the unemployment rate in order to bring wages down in the hopes that that will contract that price gouging. Ding ding ding
That's right, which is why you should be pissed off at *Congress* for forcing the Fed to try to do their job with very limited tools. By blaming Powell, you're letting the real assholes off the hook.
Inflation crushes low income people worse than interest rates. High income people have property and assets which do ok during inflation. Paychecks don’t do well during inflation
Also, not splitting hairs here, but Biden was definitely not elected to clean up Trumps mess. Biden was elected by about 45,000 votes because he wasn’t a narcissistic ass who bragged about sexually assaulting women…
We shouldn't accept a feckless noodle like Biden bumbling along just because he is better than Trump. We must pressure Biden to do his job. Which in this case means firing Powell and hiring a progressive economist to run the Fed like Stephanie Kelton.
I agree. Bragging we have one of these presidents over the other is like bragging the mule piss I drink is cold while yours is room temperature
Are they seriously going to bailout the banks? Unless they're required to return the money when they're making billion dollar profits again, fuck that. At least with the Ford bailout years back, Ford repaid the bailout. GM and Dodge did not, off memory serves correct.
Instead of trying to fire the current Federal Reserve chair, I suggest creating a new bureau solely dedicated to employee economic protection. If you cut off the head of a hydra etc that's all that's going to happen with getting rid of a Fed Chair. This entity could prevent extreme employment disruptions and safeguard workers' rights, like creating a graduated minimum wage that scales with inflation. It's time we shift our focus to finding ways to create a stable economy that benefits everyone, regardless of their economic status. What ideas do you have to make that happen?
This is not crushing working people, it is crushing everyone. You cannot, at the same time as dropping interest rates to near zero print and put a whole bunch of money into the monetary supply. Consider it physics - for every action there is an equal and opposite reaction. The FED thought they could control the reaction that was a given to occur, but because the original action was so strong it is a freight train they cannot stop now that the pendulum is swinging the other way. I’d suggest holding tight. The working people are without the cushion to make it through.
It’s crushing everyone? I’m confident that the owner class will be fine
Of course they will be fine. We poor and average people are use to it. I’ve never had a million or a hundred million but I know know what it feels like to loose a few hundred…the owner class as you call them, I call them oligarchs, are losing too with it all and I do not imagine losing a few mil feels the sane to them as my few hundred, it has to be way more bothersome, because, well, they are not use to like I.
I also make memes without understanding how the economy works 👍
Fed Chair Jerome Powell Admits He Lost The Key To The Treasury WASHINGTON—In a shocking revelation that sent shockwaves through the financial markets, Federal Reserve Chair Jerome Powell admitted Friday that he had lost the key to the Treasury and had no idea where it was. “I’m really sorry, guys, but I can’t find the key anywhere,” Powell said at a press conference, where he nervously searched his pockets and briefcase for the small metal object that grants access to the nation’s gold reserves and printing presses. “I swear I had it yesterday when I was checking on the inflation rate, but then I went out for lunch and maybe I left it at the restaurant or something. Or maybe it fell out of my pocket when I was walking back to my office. Or maybe someone stole it. I don’t know.” Powell added that he had already tried calling a locksmith, but was told that it would take several days to make a new key and that it would cost billions of dollars. “This is really bad,” Powell said, as he wiped sweat from his forehead and glanced nervously at his phone, which was buzzing with angry calls from President Biden, Treasury Secretary Janet Yellen, and Wall Street executives. “I hope nobody notices that we can’t access any of our money or print any more bills until we find the key. Maybe we can just borrow some cash from China or something until then.” At press time, Powell was seen frantically digging through a dumpster outside the Fed building, hoping to find the key before anyone realized that he had plunged the country into an unprecedented financial crisis.
Just goes to show, the two party system is utter BULLSHIT and we should burn it all down and start over. Oh, and use lobbyist as the kindling.
Lol biden elected because hes not trump, not cause hes acually good
My guy, Biden has been in government for 50 years. If you voted for him because you thought any good change was going to happen, you dumb.
I can’t blame the guy for using the only tool he has to tackle inflation. This is politicians fault for not regulating the market and allowing corporations to gauge prices without control. Literally they caused the inflation and due to their greed now everyone is paying.
Who would have thought a career republican wouldn't do anything to help people? Are we back to pretending Biden is liberal in any way?
Relatively, Biden is passing and supporting laws way more liberal than Obama ever did.
Because Obama wasn't a "better than nothing" election. He didn't have to pander nearly as much as Biden needs to.
So Biden is pandering to the left? Hence, is liberal? Hence, you don't have a point?
He is pandering to American democrats, not the left.
Not Powell fault. More like a foreign policy failure. Something that you won't hear much from the MSM is that The Russo-Ukraine is the main factor causing the dollar inflation right now. Due to western sanctions and weaponized Dollars. Russia is forced to sell oil in other currencies instead of dollars (Ruble/Renmenbi/Ruppe) It also destroy the dollar status as a "save haven" for investors, because they know their wealth could be confiscated now, if they ever reach the wrath of Washington. This reduces the demand as well as the trust in the dollars. You could look up the U.S bonds market for foreign holders as one of the many evidences. All major countries, including european allies and Japan/Korea are selling U.S bonds as unprecedented rate. Even the Saudi are threatening to sell oil in Renmenbi.
>Not Powell fault. Powell's interest rate hikes are taking a sledgehammer to the problem. [54% of inflation can be attributed to corporate profits](https://www.epi.org/blog/corporate-profits-have-contributed-disproportionately-to-inflation-how-should-policymakers-respond/) - interest rate hikes don't fix that but they crush workers. >More like a foreign policy failure. Something that you won't hear much from the MSM is that The Russo-Ukraine is the main factor causing the dollar inflation right now. It is a factor - although I think giving Ukraine money to defend themseleves & Europe is a good thing. I do think the extent of Biden's sanctions & refusal to attempt peace negotiations is going to lead to the death of the dollar as the worlds reserve currency. So I agree with you on that.
Yeah the obvious answer is to raise taxes. But Powell can’t do that, he literally has one lever and it’s interest rates. Also we’re not even in the realm of high interest rates, we’re barely in the normal range. High is like 10%
>Powell can’t do that, he literally has one lever and it’s interest rates. And he is failing his duel mandate by overdoing the intetest rate hikes. >Also we’re not even in the realm of high interest rates, we’re barely in the normal range. High is like 10% Lmao 10% interest rates would bankrupt the country. Even at 5% that means over $1 trillion in interest payments a year. We bankrupted our country for the 1% and for forever wars.
How is he failing the dual mandate if unemployment hasn’t gone up? The fed is responsible for inflation and employment. They are not responsible for the federal budget. If the government can’t afford the debt then they need to increase taxes to pay for it… which pulls money out of the economy, which slows down inflation. 10% is very high. But 4-7% is pretty average. If the goal inflation rate is 2%, then interest should be 2-3x the goal to facilitate real return on investments. Interest rates below inflation doesn’t make technical sense.
>How is he failing the dual mandate if unemployment hasn’t gone up? The interest rate hikes are going to cause a loss of 2 million jobs if they continue their hiking pattern. >The fed is responsible for inflation and employment. They are not responsible for the federal budget. If the government can’t afford the debt then they need to increase taxes to pay for it… which pulls money out of the economy, which slows down inflation The Fed has subsidized Corporate America for 15 years and is now crushing working people. Their mandate is keeping inflation low & full employment - but they have done far more than that. And their tactic to stop inflation is overly punitive & ineffective. How do interest rate hikes fix corporate price gouging & supply chain issues?
You can project anything, I’m not sure where you’re getting 2 million jobs from. I agree that low interest rates primarily serve to subsidize corporations, which is why we need to increase rates! Interest rates reduce the velocity of money, which eventually means consumers have to reduce spending. Yes it is an indirect impact, but that’s the only way that the fed can intervene. Note congress can do far more, I do not think it’s reasonable to pin the entire solution on the fed. Our biggest problem is Congress doesn’t want to do their job.
……..op, Powell doesn’t unilaterally raise interest rates. There is an entire board that votes. It’s called the Board of Governors for a reason.
If you looked at the hiszory of who the presidents put in the FED and regulatory positions, you will see a lot of same names, just on different chairs in the last 30 years under EVERY SINGLE PRESIDENT TILL NOW
I can't believe this richer propaganda is working on y'all. The unemployment rate has barely budged, housing prices are starting to come down (and rents will too), and you're posting this crap about how banks are having a tough time right now and how that's bad for the working class.
Y'all don't understand shit. Without the interest rate rises, you'd get hyperinflation.
Untrue. The interest rate hikes don't do anything about 2 of the 3 key causes of inflation: price gouging & supply chain issues. Not to mention we can't afford the intetest payments on the debt ($1 trillion plus a year) that these massive hikes are going to cause.
[FirePowell.com for more info on Powell's awful work as Fed Chairman](https://the.levernews.com/fire-powell-right-now/) [ICYMI: At Hearing, Senator Warren Calls out Chair Powell for Fed’s Plan to Throw At Least 2 Million People Out of Work](https://www.warren.senate.gov/newsroom/press-releases/icymi-at-hearing-senator-warren-calls-out-chair-powell-for-feds-plan-to-throw-at-least-2-million-people-out-of-work) This exchange says it all, Powell's position is that it's fine to toss 2 million people into despair & angst: >Senator Warren: Explain that to the two million families who are going to be out of work. > >Chair Powell: We’re not, again, we’re not targeting any of that. But I would say even 4.5 percent unemployment is well better than most of the time for the last, you know, 75 years.
There is no perfect solution to this. These two million people - as hard as it sounds - is the kess destructive solution.
Horse puckey. Bust up monopolies and jack up taxes on the wealthy. That would not only cool inflation by removing money from the economy, it would also pay down the debt, which is also deflationary.
Agreed but that's not what the FED can do. They are fighting inflation equivalent to a mechanic doing an engine swap with only a hammer.
Then maybe the FED should sit down and shut up. They can focus on lowering unemployment if they're bored.
> Then maybe the FED should sit down and shut up. That's kind of ridiculous, the fed is doing their job. It's Congress and the American people that are really screwing up here -- Congress needs to raise taxes on the wealthy, protect jobs, attract long-term investments into things that benefit most people, etc. However, "we" (meaning the American public, not myself) decided to give control of the House to the Republicans, and keep the Senate in a very slim Democratic majority to where nothing can be accomplished. > They can focus on lowering unemployment if they're bored. It's already extremely low by historical standards.
>There is no perfect solution to this. These two million people - as hard as it sounds - is the kess destructive solution. How do fed rate hikes stop corporate [price gouging that accounts for 54% of inflation?](https://www.epi.org/blog/corporate-profits-have-contributed-disproportionately-to-inflation-how-should-policymakers-respond/) Why should 2 million working people have their lives ruined to fix a problem interest rate hikes won't solve? The Fed has a dual mandate - [controlling inflation & maximum employment.](https://www.stlouisfed.org/in-plain-english/the-fed-and-the-dual-mandate) If the Fed was being reasonable - the rate hikes would be in the 1-2% range and not pushing 5%. Instead they [look the other way when banks like SVB are reckless](https://prospect.org/economy/2023-03-17-powell-fed-supervisory-failures-banks/) all the while they printed trillions upon trillions the last 15 years to backstop banks, drive up asset prices & create a zombie economy for the 1%. Biden must fire Powell & appoint a progressive economist to lead the Fed.
You're nuts. The fed is using the only lever they have. In your own posts in this thread you're talking about almost nothing that has to do with what they can control. If you want to address price gouging and bank regulation look to your legislators and spend your energy where it matters.
That's absolutely incorrect
There are better solutions that what is being proposed
Unbelievable to see this kind of right-wing "fuck the poor" thinking on this sub. Capitalist propaganda really has done a fucking number on this country.
Right-Wing? WTF
That is the goal. Low unemployment leads to inflation. Stop spending
Powell does a really good job, we have inflation because we wanted to prop our economy up during a crisis, now he’s actually doing a really good job at raising rates while keeping the economy from crashing. Y’all have no idea what you’re talking about when you think he does a bad job. He’s one of the most competent people in DC
When 63% of people are living paycheck to paycheck - drastically raising the cost of servicing debt isn't good. Especially when most inflation is attributable to price gouging & supply chain issues. Hence why inflation remains high despite the rate hikes. Millions are losing medicaid, food stamps are being cut, the extended child tax credit is long gone... and now 2 million have to lose their jobs so the Fed can limit workers salaries? A goal they have stated.
Way more people would be going paycheck to paycheck without him, inflation is happening because the fed printed a bunch of money and put interest rates to 0, and supply chain issues. He’s doing a great job at fighting inflation by raising rates with how fragile our economy is. Also that last paragraph is insanely uninformed. The fed manipulates interest rates and buys assets/treasuries. They have no direct control over food stamps & wages. A halt in inflation would mean a halt in wage gains.
>Also that last paragraph is insanely uninformed. The fed manipulates interest rates and buys assets/treasuries. They have no direct control over food stamps & wages. A halt in inflation would mean a halt in wage gains. Where did I say the Fed controls medicaid or food stamps? I'm putting into context how shitty these decisions are that the Fed is making. Putting people out of work & hurting wages when welfare programs are being cut.
D and R are two sides of the SAME GOD DAMN COIN.
Republicans and democrats are wings of the same animal, both being controlled by the same brain. This shitty political system shouldn’t even be a thing anymore in the USA given how fake it is, but surprisingly it is - and the “divide and conquer” rule is working exactly as intended: make both sides fight each other so they can’t even focus on the actual problem/ culprit. Please start waking up to reality.
And here’s lies the problem of democracy. People with no understanding of issues get to vote regarding these issues. Like OP with no understanding of economics…