Business Stagflation Is Just What the Economy Needs - lol ok

The US Federal Reserve’s pitched battle with rising prices has given rise to widespread concerns about a possible return of stagflation — the combination of high unemployment and high inflation that afflicted the US in the 1970s.

Actually, a bit of stagflation is just what the Fed should be — and appears to be — aiming for.

Monetary policy acts with a lag: If a central bank wants inflation to be lower a couple years in the future, it must raise interest rates now, to generate the slack in consumer and labor demand needed to slow growth in prices and wages. The appropriateness of its policy should thus be judged on where it expects unemployment and inflation to be. It shouldn’t, for example, plan to miss its targets in opposite directions – a policy rule known as Qvigstad’s criterion (after the Norwegian central banker Jan Qvigstad). 1 If unemployment remains elevated when inflation is already below target, monetary policy has been too tight, inflicting more economic pain than necessary.

Logical as this all might be, it has a perhaps surprising implication: If the Fed is doing its job right, it will push up the unemployment rate before inflation declines, and both will remain elevated until they reach their targets. In other words, in accordance with what Qvigstad recommends, the Fed should be seeking to achieve a period of stagflation.

Judging from the Fed’s most recent economic projections, a small amount of stagflation is exactly what it’s going for. The median forecast, which assumes appropriate monetary policy, puts inflation and unemployment about 0.3 and 0.4 percentage point above target, respectively, at the end of 2024. While Qvigstad’s criterion offers no guidance on what the relative size of unemployment and inflation misses should be, it appears that the Fed views a roughly one-for-one trade-off as appropriate.

Granted, the Fed’s forecasts tell us nothing about how it might respond if the economic outlook worsens. If, for example, officials decide that supply disruptions will be more persistent than previously thought, will they stick to the one-for-one tradeoff — allowing, say, inflation and unemployment to pass through 5% and 7% on their way to their targets? How much stagflation is the central bank willing to tolerate? This is a crucial policy question that the Fed needs to answer publicly.

https://www.bloomberg.com/opinion/a...hat-the-economy-needs?leadSource=uverify wall (Archive)

 

[God's drunkest driver]

And this has been your daily reminder that the elites actively hate you and just see you as a tool to achieve the statistical ends they desire if you're a member of the middle class or lower.

 

[pikachudidnothingwrong]

Politicians will do like they've done for 50 years, look towards immigration from third world shitholes.
This only delays the inevitable, infinite growth is a meme. In truth we should start looking at what happened to the japanese economy and try to find a way to suffer through the same fate with minimal upsets. People need to learn that the arrow can't always go up

So much this! It is one of the single biggest factors behind so much of what is wrong with our current ruinous concepts of 'capitalism" and "market"... Not just on the more general level that I suspect your are talking about here either. Even on a smaller scale, particularly in terms of how we do companies today. So many people fail to understand what "growth" means in market terms in regards to a company. It doesn't mean making more then you spend, it means making more than you made last quarter/year/time, but in a way that renders profit itself potentially irrelevant. It is the one single force behind companies going full retard in the name of making more money and the single BIGGEST factor in destabilizing our economic, financial and societal systems. It's why our companies move jobs over seas even while making money, while they close down R&D divisions to make this quarter look better and all the other continued, never-ending squeezing of everybody beyond reason. The cause of it starts with the moronic concept of a business/company as a commodity.. Since people are only trading and making money on the price of a stock, profit isn't good enough, to raise the price of the company, it needs to increase it's profit/worth.. Even making a billion dollars in profit wouldn't be enough after a short while. What's the use of holding stock that stays the same price. This is the core failure of the system as a whole. Add to that distorted concepts about the goal of companies, largely invented out of necessity with this system. (Yes, the goal is always to make money because to not do so means going out of business. There is supposed to be a respect for the product/service and the customer, for the reputation) Sadly nothing else can matter though in a system that demands more and more money profit or else ruin. Most of the other ills and evils of the current system can be linked back to this one concept.

None of this above is even touching on the impossibility and insanity of the concept of "infinite" or "continued" growth in the long term.. Or the ways they attempt to deal with it and all the ways those desperate efforts distorts, warps and destabilizes the rest of the economy and society. (consolidations, buyouts, spin-offs etc)

The next biggest issue wold probably be the very idea of "free unrestricted trade" between uneven parties. (from countries with first world standards/costs trading unrestricted with 3rd world ones with basically just better than slave labor level costs, to unrestricted one-way trade with countries that don't play fair etc.) No, it doesn't "even out" in the end.. Yeah, it may cost 50%+ less for companies, which if we are lucky get passed on to us at 10%-20%.. (see above^) But what does it matter if half the country goes from middle class to lower class, or no job at all, in the process?!

There are some things that could be done without a complete burning down of the system. A proportional (to profit) dividend system would go a long way.. But elites and market nitwits would likely have a meltdown over not being able to game the system for big quick money (for doing nothing) anymore... TBH though... Fuck them.. fuck their "market" and it's so-called "logic".. Stability > growth. When it comes right down to it it really is quite insane.. The idea that we NEED growth in order to not fail, even if making billions in profit and that the whole country/world, business, jobs, industry etc be held hostage to literal market growth ideology wank.

 

[Ser Prize]

So much this! It is one of the single biggest factors behind so much of what is wrong with our current ruinous concepts of 'capitalism" and "market"... Not just on the more general level that I suspect your are talking about here either. Even on a smaller scale, particularly in terms of how we do companies today. So many people fail to understand what "growth" means in market terms in regards to a company. It doesn't mean making more then you spend, it means making more than you made last quarter/year/time, but in a way that renders profit itself potentially irrelevant. It is the one single force behind companies going full retard in the name of making more money and the single BIGGEST factor in destabilizing our economic, financial and societal systems. It's why our companies move jobs over seas even while making money, while they close down R&D divisions to make this quarter look better and all the other continued, never-ending squeezing of everybody beyond reason. The cause of it starts with the moronic concept of a business/company as a commodity.. Since people are only trading and making money on the price of a stock, profit isn't good enough, to raise the price of the company, it needs to increase it's profit/worth.. Even making a billion dollars in profit wouldn't be enough after a short while. What's the use of holding stock that stays the same price. This is the core failure of the system as a whole. Add to that distorted concepts about the goal of companies, largely invented out of necessity with this system. (Yes, the goal is always to make money because to not do so means going out of business. There is supposed to be a respect for the product/service and the customer, for the reputation) Sadly nothing else can matter though in a system that demands more and more money profit or else ruin. Most of the other ills and evils of the current system can be linked back to this one concept.

None of this above is even touching on the impossibility and insanity of the concept of "infinite" or "continued" growth in the long term.. Or the ways they attempt to deal with it and all the ways those desperate efforts distorts, warps and destabilizes the rest of the economy and society. (consolidations, buyouts, spin-offs etc)

The next biggest issue wold probably be the very idea of "free unrestricted trade" between uneven parties. (from countries with first world standards/costs trading unrestricted with 3rd world ones with basically just better than slave labor level costs, to unrestricted one-way trade with countries that don't play fair etc.) No, it doesn't "even out" in the end.. Yeah, it may cost 50%+ less for companies, which if we are lucky get passed on to us at 10%-20%.. (see above^) But what does it matter if half the country goes from middle class to lower class, or no job at all, in the process?!

There are some things that could be done without a complete burning down of the system. A proportional (to profit) dividend system would go a long way.. But elites and market nitwits would likely have a meltdown over not being able to game the system for big quick money (for doing nothing) anymore... TBH though... Fuck them.. fuck their "market" and it's so-called "logic".. Stability > growth. When it comes right down to it it really is quite insane.. The idea that we NEED growth in order to not fail, even if making billions in profit and that the whole country/world, business, jobs, industry etc be held hostage to literal market growth ideology wank.

So the reason manufacturing and production died...was so higher ups could look better on paper to entice fucking gambling via stock market traders? Holy fuck.

 

[AnotherPleb]

So the reason manufacturing and production died...was so higher ups could look better on paper to entice fucking gambling via stock market traders? Holy fuck.

Been like that since the end of WWII. At the start they didn't have to cut corners to keep getting that growth, but the end point leads to a global Brazil. The elites live in splendor while the plebs live in fucking favelas.