benjoshua wrote in Random Thoughts or OT Chit-Chat Thread:Something's bugging me.  Most people feel or say the economy is doing terrible because of "inflation."  Overall, employment is back to record highs, jobless rates are near historic lows, wages have been rising faster than before the health crisis, and overall economic growth has been running well above trend. Indeed, inflation was terrible back in the summer of 2022 at around 9%.  Today it's being reported as 3.2% and the Fed wants inflation to be around 2% which means they're getting close.  It may take awhile to get to 2%, but still, inflation at 3.2% is not terrible in my opinion.  I suspect some people don't realize that the only way prices are going back down is through deflation, something economists usually say is worse than inflation.  Therefore, what people are actually upset about is not inflation but the effects of inflation; it's something you could call sticker shock.  I'll be the first to admit I'm no economist, but you'd think someone would clarify this oddity to the public.... or maybe I'm missing something.  Perhaps there's just a lag between the economic numbers and the way they're perceived?

First off let us clarify what you thing 'inflation' is. Are you talking about the effect of prices gong up? Or are you talking about the increase in the money supply in the economy? The first is not 'inflation'. It is the effect of the latter, which has already occurred and is causing prices to rise. There is a lag effect between cause and effect, but value distruction (in the dollar) must occur one way or another. How that loss is  distributed among real assets and services in the economy is what you are eluding to in your question.

Prices can never go down of goods already produces at their optimum value without distruction of value.
You can destroy the value of the labour input - But paying people less increases or eliminating paid person input only increases the quantity of useless people in society.
You can destroy damand for the products which leaves producers with more products than buyers, so they cut prices to reduce inventory and produce less in the future.
Or you can increase the value of the dollar, which allows the dollar to buy more and things subsequently get cheaper.

All three are doable, but neither the public nor the government would be willing to walk those paths. So that we (governments and money managers) do is we plan for the destruction of the current economic system. We keep inflating and printing as much as we can to get as much out of the system as we can becuase we are in the exponential curve at the end of the hockey stick, and we manage the transition out of this system as best we can by preparing the public for the removal of money as they know it all together and replacing it CBDCs. We can distract people by talking about how they have never been richer and its never been easier to earn money, and point to Putin and China and say that all the bad evil things that happen are because of them. It keep the muppetry dumbed down and stops them learning about all the scary things in the world.

At the same time, with it being so easy to get work, you have to wonder why so many of your fellow countrymen are such bone idle fucks? Because that is the flip side of that narrative if everything is booming in our economies.

And you also have to ask yourself, why does the fed (or the people of the country) want to lose 2% of the value of their dollars every year? Why do you want to lose any of the value of your money each year? The dollar has lost 97% of its value in the past 50 years. Why do people pretend that is normal and acceptable. You wouldn't buy a house if the developer took back 2% of your garden every year.

As regards explaining inflation to the public en mass, its not something anyone can do. Many economist do not understand it. They do not teach it in school. Much of the general public are neither uninterested nor capable of understanding the economy or the money in their hands, and as John Maynard Keynes postulated, 'The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.' Someone else said, don't know who (JP Morgan?), paraphrasing here, 'people do not understand their money, and if they did, they would be so outraged that there would be a revolution in this country tomorrow.'

There is no benefit, and a lot of danger, in explaining money to the masses. They must be kept ignorant. Better that they watch their teleboxes and think what they are told to think, than return to reading and learn to think for themselves.

sauromatian wrote in Random Thoughts or OT Chit-Chat Thread:But what if Biden is using inflation to inflate away the national debt, particularly the value of US savings bonds held in China?

I have no issue with that, and I have no issue with the fact that most of the muppets in society neither care nor are able to understand the mysteries of the world they inhabit. If you know what is happenning, you know what their motivations are, and what options they have, then you can plan accordingly. China cannot be damaged by this. They planned on inflation and followed a different economic strategy 15 years ago. Both parties know what is happening. It is just an unwinding of debt and a rebalancing of value.

If the regime falls they will have a big firework display before they go down. Same can be said for any of the world’s major regimes. Every one of them will go down in a hail of bullets if it came to that. The point of funding each other and buying from one another, and aid packages and economic politics, is to see that none of us decide we are going to go out with a big hurrah. No one wants to use then Samson option, but all the nuclear countries have that ability and there’s FA any of the other countries can do to prevent it.

So we slowly renegotiate control of the world stage, move the economic might to the east, teach our populations to earn less, consume less, STFU and be happy with less, and rebalance the economies of the world with considerable less greed centred around some countries. Power is shifting, as it has done in the early part of every one of the last seven centuries. This time the world focus is moving towards the Pacific Rim.

The UK once ruled the world. It took the better part of 50 years for population of that little island to accept that their power was waning, but I think they get it now. As did France, Holland, Portugal, etc before them. So far these countries have all had their chances once before passing their reins on to another nation. None has held sway for more than a century.

Tszii wrote in Random Thoughts or OT Chit-Chat Thread:
A war against Taiwan to shore up nationalism before closing off?  N Korea part II or a civil war?  It doesnt look good. Of course, maybe they  drag it out forever like Greece or Cuba. Just grind into dust. China can watch their economy and population halve in 10-15 years and vacillate just enough to make it a slow motion train wreck.

If they lose 700M people in 15 years, then a true catastrophe has occurred.  I don't see famine taking that many lives (the world/UN just doesn't let a nation starve to death). If disease hits that hard, you can bet populations all over the world would be devastated as well.  War with Taiwan would be a desperation move, in my opinion, for the CCP to stay in power.   So many countries would align against them.  However they are technically on a war footing now...stockpiling food and energy (oil, gas, and coal).  With the US distracted in the middle east, they may see an opportunity.  

People talk about the US running out of weaponry.  
Some startling figures...US manufacturers produce

-> 8.5 to 9 Billion bullets of various types a year (civilian inventory is estimated to be 10s of billions of rounds)
-> 15,000 artillery shells a month with capability ramping up to100k a month by 2025 ( currently over 400M, 155mm shells in inventory)
-> 400 rockets of various types a month
-> 100 F-35s a year (currently have 450 with total expected fleet size of 2,500)
-> 25 tanks a year ( but has 2,500 already built)

I don't think the US is in any danger of running out of anything.  Maybe the money to pay for all this crap...

What is crazy, you can double most of the figures above if the government ever forced (through emergency measures) non DOD contractors (think auto companies and other metal works entities) to produce military products. Raw materials would be the most limiting factor.  US companies can retool factories very quickly when incentivized.

-SKA

How does the US do any of this without destroying the USD and their domestic economy?

My prediction that the US economy would do only so so this year was incorrect.  With unemployment being extremely low, inflation dropping to 3.5%, and the stock market significantly up, to me, that makes for a pretty good year.  However, as I mentioned earlier, most people in the US don't think the economy is doing poorly.  I personally think most of that has to do with increased prices, in other words, sticker shock.  However, according to the Bureau of Labor Statistics, airline tickets are down 13.2%, used vehicles are down 7.1%, TV's are down 9.4% and bacon is down 5.1%.  According to AAA, gas prices are down to $3.26 nationwide compared to $3.58 a year ago. Still, almost anyone can find or point out some statistic or metric that points to their opinion on the economy.  It appears that upper and middle class folks did better than average and poorer folks did below average economically, so who you ask matters.  Anyway, while most people are down on the economy this year, I think it did better than I expected and good overall.

I agree with Sir Kill Alot that next year is going to be rocky.  They'll likely be some wild swings.  There still could be a recession, although it's looking less likely.  You can find article on-line that say the economy is going to stink next year and also find articles that paint a rosy picture like this one from Goldman Sachs:  The US economy is on its final descent to a soft landing   Still, I think by the end of the year, things will be a net positive, especially the stock market.  I would not be surprised if international stocks do better than domestic stocks which was definitely not the case this year.  I am no economist.  

Here's an article from Saturday which basically mirrors the ideas of the discussion above:
The McDonald’s order that explains inflation, economy anger at Biden - The Washington Post

That is, no one seems to agree any more about what metric should judge the economy. Are we doing good, or are we doing bad? What is the definition of a recession, & is 'inflation' only one of those obsolete boomer words? Should I invest my savings in crypto, NFTs, or old-school RPG collectibles?

sauromatian wrote in Random Thoughts or OT Chit-Chat Thread:Here's an article from Saturday which basically mirrors the ideas of the discussion above:
The McDonald’s order that explains inflation, economy anger at Biden - The Washington Post

That is, no one seems to agree any more about what metric should judge the economy. Are we doing good, or are we doing bad? What is the definition of a recession, & is 'inflation' only one of those obsolete boomer words? Should I invest my savings in crypto, NFTs, or old-school RPG collectibles?

On the basis that the first two are not even real, I'd go with the latter.

Well, at least it keeps the muppets frightened.