Nobody Talks About How to Fight Inflation

[West Dundee Hawkeye]

Both sides bitch about inflation but nobody talks about how to stop it.

It is not rocket science. Raise taxes and cut spending on fiscal side and increase Quantitative Tightening on monetary side.

$15 Trillion has been added to National Debt since Obama left office and Fed Balance Sheet still over $7 Trillion.

 

[IIowaFarmBoy]

Because what is causing inflation is hard to deal with.

Massive money was created out of thin air. 2x

Labor shortages....supply chain issues.

Housing market issues. Too much an too little.

Lower middle and middle class is maxed out.

The poor are so poor they cant afford to work.

Industry is starting to fire older and more experienced workers leaving new magers in place that have no clue. Reducibg efficiency.

 

[95Hawk]

Because what is causing inflation is hard to deal with.

Massive money was created out of thin air. 2x

Labor shortages....supply chain issues.

Housing market issues. Too much an too little.

Lower middle and middle class is maxed out.

The poor are so poor they cant afford to work.

Industry is starting to fire older and more experienced workers leaving new magers in place that have no clue. Reducibg efficiency.

All of this. Plus our refining capabilities in the U.S. can’t keep up with demand. While the U.S. is pumping more oil and natural gas than ever, much of it isn’t consumed domestically. We import the “heavier” version from oversees, which our current refineries have been built to handle. But that capacity isn’t enough to seamlessly flow from raw product to finished petroleum - so a bottleneck occurs.

Fewer barrels of refined product coming out at a slower pace leads to higher consumer prices.

 

[MichaelKeller99]

Raise taxes? We’re already being hit with inflation and now we deserve higher taxes on top of that because of our POS politicians (yes…BOTH sides) who have recklessly borrowed and spent for a 100+ years? Screw that.

Repudiate the debt and abolish the Fed for starters.

 

[Joes Place]

Both sides bitch about inflation but nobody talks about how to stop it.

It is not rocket science. Raise taxes and cut spending on fiscal side and increase Quantitative Tightening on monetary side.

$15 Trillion has been added to National Debt since Obama left office and Fed Balance Sheet still over $7 Trillion.

Actually, they do.

But people don't want to hear it.
Tax cuts for rich people and corporations have reduced revenues 2-3%

Compounded over years, that creates big problems - you want to eliminate the deficits, then those taxes cannot simply be "returned to pre-cut levels", they need to be ABOVE those previous levels to bring the average back to what it was.

 

[Joes Place]

Raise taxes? We’re already being hit with inflation and now we deserve higher taxes on top of that

The "raised taxes" won't be on "you", they will be on the 1%-ers, who fight tooth and nail to keep their money and pay LOWER taxes than you do.

 

[seminole97]

Raise taxes? We’re already being hit with inflation and now we deserve higher taxes on top of that because of our POS politicians (yes…BOTH sides) who have recklessly borrowed and spent for a 100+ years? Screw that.

Repudiate the debt and abolish the Fed for starters.

Cut spending back to the Clinton-Gingrinch era levels and we have a balanced budget today.

Repudiating the debt would just create economic chaos, never mind being unconstitutional for that reason.

Abolish the Fed, stop borrowing by cutting spending back to 90s levels, and the debt will be worked off in 30 years at the maturation of the oldest debt instrument.

We’ll be much better off without codifying a wealth transfer (interest on national debt) from Main St to Wall St.

 

[Joes Place]

Cut spending back to the Clinton-Gingrinch era levels and we have a balanced budget today.

Nope

Too many tax cuts for the rich and corporations. Those have been "below" the average now for 2 decades.
Only way you fix that is to bring them back UP above that average for 2 decades AND limit spending.

 

[Here_4_a_Day]

Both sides bitch about inflation but nobody talks about how to stop it.

It is not rocket science. Raise taxes and cut spending on fiscal side and increase Quantitative Tightening on monetary side.

$15 Trillion has been added to National Debt since Obama left office and Fed Balance Sheet still over $7 Trillion.

Vote straight ticket Republican and it's fixed, duh!

 

[Here_4_a_Day]

All of this. Plus our refining capabilities in the U.S. can’t keep up with demand. While the U.S. is pumping more oil and natural gas than ever, much of it isn’t consumed domestically. We import the “heavier” version from oversees, which our current refineries have been built to handle. But that capacity isn’t enough to seamlessly flow from raw product to finished petroleum - so a bottleneck occurs.

Fewer barrels of refined product coming out at a slower pace leads to higher consumer prices.

Whose fault is this? Need a hint??

 

[MichaelKeller99]

Cut spending back to the Clinton-Gingrinch era levels and we have a balanced budget today.

Repudiating the debt would just create economic chaos, never mind being unconstitutional for that reason.

Abolish the Fed, stop borrowing by cutting spending back to 90s levels, and the debt will be worked off in 30 years at the maturation of the oldest debt instrument.

We’ll be much better off without codifying a wealth transfer (interest on national debt) from Main St to Wall St.

‘Unconstitutional’? Are there even five people in DC who honor their oath? Your plan is valid, though repudiation has occurred before.

Rothbard’s History demonstrates how the repudiations of the 1830s and ‘40s did not cause the sky to fall. In fact, the return to sound money coupled with a liberalization of the economy spurred a tremendous amount of growth. Rothbard explains:

It is evident, then, that the 1839–1843 [monetary] contraction was healthful for the economy in liquidating unsound investments, debts, and banks, including the pernicious Bank of the United States. But didn’t the massive deflation have catastrophic effects — on production, trade, and employment, as we have been led to believe? In a fascinating analysis and comparison with the deflation of 1929–1933 a century later, Professor Temin shows that the percentage of deflation over the comparable four years (1839–1843 and 1929–1933) was almost the same. Yet the effects on real production of the two deflations were very different. Whereas in 1929–1933, real gross investment fell catastrophically by 91 percent, real consumption by 19 percent, and real GNP by 30 percent; in 1839–1843, investment fell by 23 percent, but real consumption increased by 21 percent and real GNP by 16 percent. (p. 103)

So how much should we repudiate? I don’t know. The amount should be big enough to scare reality into the investors of US Treasuries (and hopefully politicians), but not too big that it wipes out the retirement funds of those looking for the “safe” investment. Perhaps the Treasury should declare that they will pay 80 cents on the dollar, but that just rolls the clock back a few years (back only to $11.4 trillion!).

The sad reality is that without fundamentally changing the way the government spends, there is no solution. The four largest expenditures made by the government are, from greatest to least, (1) Social Security, (2) Medicare and Medicaid, (3) defense, and (4) welfare. We can’t really print our way out of the mess, because Social Security payments, etc., are indexed to the CPI. We can’t grow our way out either, because they’re also linked to growth rates.

So repudiation is not a complete solution. It is a part of an overall solution of (real) spending cuts, economic growth, and debt repudiation.

 

[alaskanseminole]

Nobody Talks About How to Fight Inflation​

 

[markfromj]

I don’t get “the Fed balance sheet”.

I know what a balance sheet is.

But when you “add to the Fed balance sheet” you add to both sides: Assets = US Treasuries. Liabilities = …what?

 

[MichaelKeller99]

The "raised taxes" won't be on "you", they will be on the 1%-ers, who fight tooth and nail to keep their money and pay LOWER taxes than you do.

So the puppeteers (1%’ers) are going to allow the puppets (congress) to tax the f*** out of them in order to pay off the debt?

😂😂😂

 

[markfromj]

…and pay LOWER taxes than you do.

No, they dont. Buffet’s “my secretary pays higher rate than I do” was complete crap, a disservice to the country, and just lapped up by the self-disempowered.

He was talking about “percentage of assets”, a complete fiction. We don’t tax assets.

 

[IIowaFarmBoy]

Abolishing the Fed would unleash incredible negative responses. Do I always agree with the Fed? No.

The Fed causes bubbles but not all. It can crash them. But 2008 would have been a super depression without it. Our standard of living would be a lot lower. Our socialist services such as highways and airports would be dismal.

The system in entirety including govt fiscal policybisvdesigned for the 10 percent but we in the middle get dragged up with it, losing more middle along the way and allow lower educated middlers to drive super trucks, drink beer and go to Iowa games.

There is no easy fix. The result will be longer no recession runs with really big ones when they happen. Our stocks will go up but few real gains will happen as wealth is transferred upward.

Abolish the Fedsters should study the long depression of the 1870s.

Per deficit spending, we could never afford a lot of our support system without it which is why there was Brexit.

 

[IIowaFarmBoy]

I don’t get “the Fed balance sheet”.

I know what a balance sheet is.

But when you “add to the Fed balance sheet” you add to both sides: Assets = US Treasuries. Liabilities = …what?

The biggest asset is student loans

 

[IIowaFarmBoy]

Whose fault is this? Need a hint??

All of us Frogs in the boiling pot.

 

[Hawk_4shur]

I don't think that inflation and the National Debt are as connected as posters on this thread think. IMO.

Just read inflation is 2.9% for the 12 months ending July 2024. I'd like to see it below 2%, but it's not really too bad now. But lower inflation doesn't fix the price increases that have already occurred on groceries, housing, gas, utilities, etc.

When demand exceeds supply, you get price increases (inflation). The post-pandemic demand roared back to pre-pandemic levels, but suppliers all over the world had huge cutbacks during the pandemic and it's taken a while for them to adjust. Government policies didn't do that.

I don't agree with Harris' price control idea. The "economy" is going to go where it is driven by supply and demand. The segment of the population that can no longer afford the basics need to be helped in other ways - like lower taxes. Lower income taxes and property tax credits for low income would be a good start.

The stock market increased 148% in eight years under Obama, 51% in 4 years under Trump and 39% so far under Biden. The people that have money in the market (savings or retirement plan) have done very well and far out-paced inflation. A quick Google search says that's 61% of Americans.

Most Americans can deal with higher prices, Let's fix it for those that can't.

 

[Here_4_a_Day]

All of us Frogs in the boiling pot.

The refinery thingy.....what one "group" has made it nearly impossible to expand refinery capacity in America?? HINT: It's not the Koch brothers!!

 

[Joes Place]

So the puppeteers (1%’ers) are going to allow the puppets (regular people) to tax the f*** out of them

Only if you VOTE.

It's why they flood your media sources with bullshit to make you vote against your own interests.

 

[Joes Place]

No, they dont.

Yes.

They absolutely do.

 

[Hawk_4shur]

No, they dont. Buffet’s “my secretary pays higher rate than I do” was complete crap, a disservice to the country, and just lapped up by the self-disempowered.

He was talking about “percentage of assets”, a complete fiction. We don’t tax assets.

He was talking about tax on income - Federal income tax and payroll taxes (social security and Medicare).

Warren Buffett and His Secretary on Their Tax Rates

Get breaking national and world news, broadcast video coverage, and exclusive interviews. Find the top news online at ABC news.

abcnews.go.com

Buffett's income is probably almost entirely qualified dividends and capital gains, taxed at 20%. After deductions, his tax was 17.4%. His secretary pays regular income tax at her rate plus 7.65% payroll taxes. After deductions, her rate was 35.8%.

 

[Joes Place]

No, they dont. Buffet’s “my secretary pays higher rate than I do” was complete crap

1%-ers and hedge fund guys pay WAY lower taxes than upper-middle class ($100k-200k) and probably less than those making $50-100k.

You seem to think I'm referring to "lower middle class" here, but I'm not. People who work day-jobs (white collar) pay far more of their income in taxes than the 1%-ers AINEC.

 

[Here_4_a_Day]

Only if you VOTE.

It's why they flood your media sources with bullshit to make you vote against your own interests.

You don't even have the capacity to vote.

 

[seminole97]

‘Unconstitutional’? Are there even five people in DC who honor their oath?

Yeah, I expect the Supreme Court to keep that. It would cost us as an investment haven to explicitly contravene that promise.
Don’t throw out the baby (property rights) with the bath water (unnecessary debt).

Your plan is valid, though repudiation has occurred before.

Rothbard’s History demonstrates how the repudiations of the 1830s and ‘40s did not cause the sky to fall.

Federal debt is distinct from state debt, especially in our current monetary system. In those crisis the states were not bailed out, which is a policy I would want the Feds to maintain. As you noted, the sky didn’t fall,

 

[Hawk_4shur]

1%-ers and hedge fund guys pay WAY lower taxes than upper-middle class ($100k-200k) and probably less than those making $50-100k.

You seem to think I'm referring to "lower middle class" here, but I'm not. People who work day-jobs (white collar) pay far more of their income in taxes than the 1%-ers AINEC.

This is absolutely true.

You can add a lot of retirees to the list. I'm not a 1%'er by any stretch, but I've paid almost no Federal tax since I retired (8 years). My income is entirely qualified dividends, capital gains and social security - all favorably taxed. Add in a healthy standard deduction and you can make a very nice income free of Federal tax.

Now, in a few years I'll have to take an RMD from my 401k and I'll pay lots of tax, but still a lot less that a wage earner.

 

[Here_4_a_Day]

The "raised taxes" won't be on "you", they will be on the 1%-ers, who fight tooth and nail to keep their money and pay LOWER taxes than you do.

Why are you entitled to another family's bounty?

 

[joelbc1]

Cut spending back to the Clinton-Gingrinch era levels and we have a balanced budget today.

Repudiating the debt would just create economic chaos, never mind being unconstitutional for that reason.

Abolish the Fed, stop borrowing by cutting spending back to 90s levels, and the debt will be worked off in 30 years at the maturation of the oldest debt instrument.

We’ll be much better off without codifying a wealth transfer (interest on national debt) from Main St to Wall St.

Cut spending back to ‘90’s levels? Where in La-Land do you live!
Also, if the 90’s are days you are pining for, understand interest rates were running in the 8+% area… much higher than today’s rates which critics point to a a key reason for higher prices.

 

[West Dundee Hawkeye]

The biggest asset is student loans

Ben Bernanke, the then Federal Reserve Chairman, started adding to the Fed Balance Sheet in 2008 after Lehman went under.

He did this through a brand new mechanism called Quantitative Easing. His goal was to help the rich by creating the "WEALTH EFFECT". That is his exact term.

The Fed would print money out of thin air and buy US Treasuries and Mortgage Backed Securities and that is how the Fed Balance Sheet got so big.

By purchasing these secsurities, the Fed was able to raise bond prices and lower interest rates. It also made equities (stocks) more attractive when compared to bonds.

Bernanke said it would be temporary and not exceed $1 Trillion. That was BS.

After the Fed did it, the other central banks of the world starting doing it.