Krugman on inflation fears

[BootinUp]

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[Poiuyt]

1. I don't understand advanced economics, but I trust Krugman.

I have no idea what he said.

[BootinUp]

2. the charts help if you click

through and take a minute

[Cerridwen]

3. He said 100s of 1000s of deaths are economically advantageous

and not such a bother as "they" thought it would be.

The haves have more so the economy is doing fine.

[Hekate]

6. Link to source?

Thank you

[WHITT]

4. Also

1) We're still down like 8 million jobs, 10 million if you include where we would have been with no pandemic.

2) A few years back (pre-pandemic), Fed chair Powell decided to 'normalize' interest rates, and started raising rates quarterly, and the national economy started to roll over, so he had to drop rates back close to zero. The fact that the economy can't function unless interest rates are close to zero, is a big fat clue that the national economy is weak. His first interest rate hike is currently scheduled for late 2023.

[BootinUp]

5. good points.

It doesnt feel like inflation to me in the long term fwtw. We are seeing supply issues rt now.

[dsc]

11. Some may not come back and not just for economic weakness reasons

I think that some won't come back because some people figured out working isn't worth it given the cost of child care and other work related expenses. Why work of all the money is going to child care?

[DallasNE]

7. Yes, We Will Have Transitory Inflation

We have supply chain problems and that will lead to shortages. This will create short term demand pull inflation. Don't overreact to this. There will be labor shortages in some areas as well and that will require pay increases to hire the workers. That, too, will level out as well. No reason to panic on inflaton.

[-misanthroptimist]

9. Spot on analysis, imo, and well stated.

[modrepub]

8. What's Interesting To Me

is that there seems to be almost no correlation between M1 (money supply) and inflation (in urban areas). Classic economics explains inflation as simply too much money chasing too few goods. At least theoretically, as the money supply within the economy goes up folks should bid up the price for a limited supply of goods. That doesn't appear to be happening.

Is the lack of correlation between money supply and inflation because newly minted money gets unevenly distributed to ultra rich folks and companies who bank it (buy T-bills for example)? Is it because the market is able to produce more goods as overall demand goes up thus blunting any price inflation? Or maybe something else or a combination of something elses? You'd think economists would look at this a little closer to see what's been going on over the last decade, which seems very anomalous.

[-misanthroptimist]

10. The answer to all your questions is "yes".

Add into that the fact that scarcity is no longer a real issue across a wide array of consumer items. If demand goes up, suppliers make more -and very quickly.