Not actually a response to my point. Does the price of lumber (or any paricular good) have any direct relationship to the price of a dollar?
So they take 2% this year, and then 2% of what's left next year, and then 2% of that the next year, and so on and so on...
Like I said you are arguing with yourself. When he burned that mountain of money in 2020, even the Fed said there was going to be inflation on 2021, and they were right. What they did not foresee was the second factor which was the supply side problems also driving up prices.
because supply went down globally during Covid and when Covid ended, the supply was not there for the demand especially oil, which was reduced during covid
We've had very good results after leaving the golf standard. Less swings in the economy. No depression like we had in the past. Buying and selling of goods is always about what one is willing to pay for. No matter the standard the money supply is tied to. I used to be a gold standard advocate. But the results since leaving it has been mostly good.
There's been several. I posted, no depressions. And not being on the gold standard gives the fed tools to avoid the depressions. Sometimes they can avert a recession. Like we could have gone into from the inflation fight. Don't think we're completely out of the woods on that yet.
If one isn't capable of improving one's own financial health more than 2% yr over yr. One probably needs some financial help. There's plenty of help out there. Heck most get raises or climb the so called corporate ladder and can easily outperform 2%.
But you admit that they are stealing 2% from everyone every year. Year in and year out. We agree that's what is happening?
Nope I say it's a hidden tax. Not hiding very well. As everyone knows it's there. Even advertised to be a goal. So people can prepare.
The Fed doesn't really "decide" to print more money. They do it in response to the government running up big budget deficits and needing someone to purchase all the extra debt. Because they know otherwise it will shoot up the interest rates and make it more expensive for the country to maintain that debt. It's not like they wanted to print more money. But they believed that was better for the economy than the alternative, when the government needs someone to buy all that new debt. It wasn't the Fed raising interest rates. Not really. Inflation pushed up interest rates. The Fed just pumps out more money to buy up the mounting debt because it's better than the alternative (many would say). The real fault is government. People in Congress are not stupid. They know increasing spending beyond what the country takes in taxes will result in inflation. (Or maybe there are some wacky people who actually believe government can overspend without causing inflation) If you listen to what the Fed says, they're even saying interest rates are having to go up in response to inflation. When the Fed or others say that the Fed raised interest rates, it actually means something a little bit different from what many might assume. It's kind of a very casual use of the word. The Fed no more has "raised" interest rates than I would "raise" the temperature by turning up the thermostat on a hot day to shut off the air conditioning.
And this whole "we're going to secretly tax you 2% every year" is written into the US Constitution where exactly?
Powell said fear wages will rise, why he raised interest rates funny when the job market favors employees, the FED wants to shut that down "Transcript: Fed Chief Powell’s Postmeeting Press Conference" https://www.wsj.com/articles/transcript-fed-chief-powells-postmeeting-press-conference-11651696613 "Employers are having difficulties filling job openings, and wages are rising at the fastest pace in many years."
If prices inflate 2% and your income increases by 4%, they why complain? This time we had monetary, demand-pull inflation, cost-push inflation so our economy was like a piñata
Congress created the boondoggle of free COVID money. The Fed is trying to do what it can to reign in the effects of those acts. I am not sure what it is doing is really going to bring the ship to shore anytime soon, but they have limited tools to work with. The real dilemma is going to be the housing market. There doesn't seem to be a real way to "soft land" real estate. I am fairly sure the Fed doesn't much care about that particular industry at the moment, but it wouldn't surprise me to see another 2008 great recession sized disruption to housing. There is too much speculative investment there adding its own layer of inflation on top of the COVID/interest rate inflation. It may not be banks that take the hit this time as much as ETF's and pension/retirement funds though. It is part of the reason I have moved all my 401K investments into international funds. The American economy is becoming too schizophrenic and my gut instinct is that retirement funds are going to be left holding the empty bag when it is said and done.