Inflation
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The Fed Targets a Crafted Measure of Inflation: A Cautionary Tale
“Understanding government data for what they are and what they are not is vital to understanding the impossibility of targeting the cost of living, even though the Fed is targeting a crafted measure of price inflation.” ~ Gregory van Kipnis
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Unemployment and Bankruptcies – Is This Time Different?
“The recovery we are witnessing today is built on the crumbling foundations of the serial malinvestments which resulted from previous attempts to avoid the recessionary pain caused by the GFC. If structural inflation can be engendered, an escape from the worst ravages of overindebtedness may be nigh, but, until markets clear and zombies die, what…
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Lift Your Gaze, Please: the April Inflation Overshoot is Not the Problem
“A betting man, if he wants to remain a betting man, updates his priors. So, I side with Jason Bloom at the asset manager Invesco: ‘There is so much dislocation in the economy from the reopening and base effects from a year ago that it will take at least six to 12 months before we…
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Monetary Inflation’s Game of Hide-and-Seek
“Whether the CPI records a higher or a lower rate of general price inflation, the more deleterious effects resulting from monetary inflation are those relative price and wage distortions, and resource, labor and capital misallocations and misdirection, that are hidden beneath the ‘surface’ of the general price level, but nonetheless set in motion the phases…
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Lumber, Labor, and Gas Markets Tell SAD Stories
“As economists emphasize whenever price gouging rules kick in, ignoring what supply and demand analysis has to teach us usually means making the problem worse rather than better.” ~ Art Carden
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War Of Words Over Inflation Stirs Questions for the Fed
“Does it make sense, for a nation founded on the notion of individual liberty, equality under the law, and personal property rights, to allow a government agency to manipulate the value of the currency used by its citizens? Would it be better to have a stable monetary foundation to facilitate free-market outcomes, rather than empower…
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A Trillion Here, a Trillion There
“In the end, the total of what comes out of the economy is limited by the total of what is produced, no matter that you can borrow or print up unlimited amounts of money. Borrowing and printing up trillions and trillions of dollars isn’t real. It’s a special form of deceit we economists call inflation.”…
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Lots of New Money, But Still-Low Inflation. What Gives?
“Just because a reckless central bank foists tons of fake money on banks, businesses, and households does not mean any of them must spend it. Fiscal-monetary recklessness itself can signal private-sector actors not to part with safe, liquid assets. Eventually, of course, they may choose to flee the money and the debt, bringing higher inflation…
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Inflation Outlook: Likely Worse Than Expected
“The Fed has painted itself into a box, because if inflation/velocity does heat up beyond what the Fed or markets can tolerate, given that they have been comfortable with somewhat higher long-term rates, the Fed’s only weapon to slow inflation down would be to slow down the economy. Its strongest weapon would be to threaten…
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Yes, This Time We’ll Have Inflation, and Here’s Why
“The political forces supportive of anti-growth policies such as trade restrictions, higher minimum wages, perverse energy regulations, and cronyism appear to be on the rise, and they will dampen future growth. But inflation is going to be the big story of the post-pandemic economy. Get ready for an inflationary ride.” ~ James D. Gwartney
-
•
The Fed Targets a Crafted Measure of Inflation: A Cautionary Tale
“Understanding government data for what they are and what they are not is vital to understanding the impossibility of targeting the cost of living, even though the Fed is targeting a crafted measure of price inflation.” ~ Gregory van Kipnis
-
•
Unemployment and Bankruptcies – Is This Time Different?
“The recovery we are witnessing today is built on the crumbling foundations of the serial malinvestments which resulted from previous attempts to avoid the recessionary pain caused by the GFC. If structural inflation can be engendered, an escape from the worst ravages of overindebtedness may be nigh, but, until markets clear and zombies die, what…
-
•
Lift Your Gaze, Please: the April Inflation Overshoot is Not the Problem
“A betting man, if he wants to remain a betting man, updates his priors. So, I side with Jason Bloom at the asset manager Invesco: ‘There is so much dislocation in the economy from the reopening and base effects from a year ago that it will take at least six to 12 months before we…
-
•
Monetary Inflation’s Game of Hide-and-Seek
“Whether the CPI records a higher or a lower rate of general price inflation, the more deleterious effects resulting from monetary inflation are those relative price and wage distortions, and resource, labor and capital misallocations and misdirection, that are hidden beneath the ‘surface’ of the general price level, but nonetheless set in motion the phases…
-
•
Lumber, Labor, and Gas Markets Tell SAD Stories
“As economists emphasize whenever price gouging rules kick in, ignoring what supply and demand analysis has to teach us usually means making the problem worse rather than better.” ~ Art Carden
-
•
War Of Words Over Inflation Stirs Questions for the Fed
“Does it make sense, for a nation founded on the notion of individual liberty, equality under the law, and personal property rights, to allow a government agency to manipulate the value of the currency used by its citizens? Would it be better to have a stable monetary foundation to facilitate free-market outcomes, rather than empower…
-
•
A Trillion Here, a Trillion There
“In the end, the total of what comes out of the economy is limited by the total of what is produced, no matter that you can borrow or print up unlimited amounts of money. Borrowing and printing up trillions and trillions of dollars isn’t real. It’s a special form of deceit we economists call inflation.”…
-
•
Lots of New Money, But Still-Low Inflation. What Gives?
“Just because a reckless central bank foists tons of fake money on banks, businesses, and households does not mean any of them must spend it. Fiscal-monetary recklessness itself can signal private-sector actors not to part with safe, liquid assets. Eventually, of course, they may choose to flee the money and the debt, bringing higher inflation…
-
•
Inflation Outlook: Likely Worse Than Expected
“The Fed has painted itself into a box, because if inflation/velocity does heat up beyond what the Fed or markets can tolerate, given that they have been comfortable with somewhat higher long-term rates, the Fed’s only weapon to slow inflation down would be to slow down the economy. Its strongest weapon would be to threaten…
-
•
Yes, This Time We’ll Have Inflation, and Here’s Why
“The political forces supportive of anti-growth policies such as trade restrictions, higher minimum wages, perverse energy regulations, and cronyism appear to be on the rise, and they will dampen future growth. But inflation is going to be the big story of the post-pandemic economy. Get ready for an inflationary ride.” ~ James D. Gwartney