What Went Wrong With US Inflation

Easy.... Uncontrolled printing $$ and spending by Gov't, and high energy prices, again caused by Gov't.

You all got it backwards.
They spent 15-20 years normalizing loans and made a large part of the economy based on those loans.

Kickstarted inflation by QE.
Then they pulled the carpet from beneath, raising interest rates, and with everyone stuck on loans(which often have to be renewed at the new interest rate) they have to raise their prices with every renewal of loans to keep up with interest payments. This caused inflation(rate of price increases).

So rising interest rates in this scenario don’t fight inflation - it fuels inflation.

I had 2 home loans. In 1995 I paid 7.25%, and in 2005 I paid 6.75%. Todays rates are not the exceptions, but closer to the norm. The ultra low 2-3% mortgages where abnormality and some people thought that would last forever, which is their mistake.

Don’t matter if mistake or not. It was being pushed on people and taught.

The consequences are of a different magnitude now, my point is that you can’t fight inflation with interest rate hikes under these circumstances. It will only worsen it.

If plan is to kill the economy, ownership and all companies except the major ones, then i would say interest rate hikes work.

Like Ueda often speaks: ”There is lagging effects”
Some of these lagging effects may start to kick in soon, we see it already in commercial real estate and increased inventory for car manufacturers and sales.

Anyways i wouldn’t be surpriced if they start digging into the pension funds and social security once shit hits the fan. Will do no one no good to be ’right’ or blame someone then.
Better to recognize that these interest rate hikes will do absolutely no one any good.

It will erode the value of money as every takeover will mean takeover of debt. It’s a vicious cycle at the peak of demographics. Gen-Z and millenials won’t pick it up.

Just like the anatomy of the human body is connected, so is the economy. Debt has only increased after the hikes at proably the highest rate in history. It’s a sign that proably this medication didn’t work

save your breath...i bought my first house in 1993 and I think I had 6.5 or 7%

all these idiots are foreigners and have no idea how things are done here but spout stupid shit about our rates and debt LOL


just use them to trade against

It’s like the hungarian George Soros says: ”i don’t play the game by a particular set of rules; I look for changes in the rules of the game”

History lessons and personal anecdotes only carry value if you can connect them, and draw logical conclusions from those connections.

Great men are liberal and open to ideas. Not bound by tribalism or nationalism.

I think struggles with remembering the present opens up a path to more cheerful understandable information from our past. It happens to everyone.
Many are the old men who say ”I remember back in the day..”
You hear the story, hoping to learn some wisdom from it.