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Thread: ''Free floating'' inflation hysteria?

  1. #1 ''Free floating'' inflation hysteria? 
    ...matter and pixie dust wegs's Avatar
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    Thought this was interesting, and wanted to share...what do you think? Economist's View: 'Free-Floating Inflation Hysteria'


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  3. #2  
    Forum Radioactive Isotope sculptor's Avatar
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    The unemployed and underemployed don't spend as much. Those who lost much(most?) of their life's savings in the crashes are saving to get their retirement funds back, and don't spend as much. So they help keep inflation in check.

    That being said some things like ammunition have doubled in price in just a couple years, and I see inflation with every trip to the hardware store or lumber yard.
    I suspect that the official numbers for inflation are as inaccurate as the silly numbers for the unemployed.


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  4. #3  
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    Inflation is the least of US concerns at the moment. In contrast, the goal of 2% is rather low. Expanding monetary policy has at least a procyclical savor and it is why US doesn't suffer so much even though full recovery since 2008 is still on the go. The real question is how effective is it at a zero lower bound. Krugman says it's not and I'll agree with him.
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  5. #4  
    ...matter and pixie dust wegs's Avatar
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    Not sure if it’s the ‘least’ of US' concerns, but not at the top of the list, true. I think you both make valid points, and interesting to note from the article (and I think this is especially dangerous, personally) is the comment about ‘’artificially’ setting interest rates at close to zero. I don't get the reasoning. Well, I do...but, it just seems to not be beneficial.
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  6. #5  
    Forum Radioactive Isotope sculptor's Avatar
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    Interest rates close to zero forces savers into mutual funds which buy stocks and bonds. Those interest rates are a big component in the dow being at record levels. Much of the feds printing is going to buy us treasury bonds/bills. Some of which is servicing the debt, and much is going overseas in our seemingly endless series of meaningless wars. Both of which also limit domestic consumer spending.
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