Reply to Can someone explain to me why we have such high inflation now?

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]Amazing how Americans don't understand basic econ. You thought all those stimmi checks, PPP loans, and other free give aways had no consequences?  The US gov have away multiple trillion dollar+ stimuli.  The Fed juiced the economy with zero percent interest rates, doubled the supply of money in only 2 years, and expanded the balance sheet to $9 trillion dollars (it was only $800B around 2008).  When you have that much cash and credit liquidity in the system you get persistent inflation.  How in the hell do American consumers STILL have a voracious appetite for vacations, cars, electronics, dining out, etc. even though prices are skyrocketing?  It's because people have too much money. The stamina for price hikes that Americans have is absurd.  It means inflation is sticky and very difficult to dislodge.

The latest CPI report tanked the markets. It was very bad.  It clearly shows inflation is being driven by excessive demand as well as an overly tight labor market and not so much due to supply constraints.  Yes, the labor market is too hot. [b]Unemployment also needs to go back up[/b] to reduce the strangle the labor market has on inflation.

The fed is now raising interest rates and quantitative tightening to remove money and liquidity from the economy.  Costs to borrow are skyrocketing. It will bring down asset values, remove.miney from the system, [b]and hopefully cause unemployment to go up[/b]. The net result will hopefully be taming of this terrible inflation.[/quote]

Amazing how you don't understand this is a global phenomenon.  It's not just the United States.

Also, FU with your "people need to suffer unemployment to solve the problem."  I bet you're not volunteering to quit your job.  We have a garbage social safety net in this country.  I, for one, am willing to pay more for things if it means that more people have jobs.  [/quote]

You are the biggest imbecile on these forums. Newsflash moron: the labor market is unhealthy. In case you haven't noticed, real earnings for Americans are DECREASING because of inflation. Labor productivity is tanking, which is all helping to push inflation higher.  The labor market needs to cool so a healthier equilibrium is set they helps to combat inflation and Americans are not getting negative earnigns growth because of inflation.  You are dumb.[/quote]

NP.  For those to continue enjoying the buying power of their earnings instead of seeing them deteriorate many more have to lose jobs and earn nothing, lose homes for housing prices to tank for those like you who will enjoy lucrative employment and get to keep your home? T  I get it.  here is labor shortage as many people just don't want to work anymore or want better hours, wages, etc.  Maybe the problem isn't really inflation, but the fact that we had crappy work culture in this country to start with? Other countries are experimenting with a 4 day workweek, while we are dialing up the pressure to have everyone return back to the rat race of full time office work and commutes (a hard sell given most remote workers were able to do their jobs just fine in the last 2 years).  Maybe we need some reforms in the workplace, increase and not decrease flexibility, create more part time jobs to attract those who exited job market back in?

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