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Thread: Interest rates in the coming months

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    Default Re: Interest rates in the coming months

    Regardless of whether or not it taxes "income" there is a proposed Net Investment Tax of 3.8 % which will result in a top EFFECTIVE tax rate of 46.4% on the highest earners. I didn't even mention the proposed increases in the Capital Gains tax.

    Florida has done an excellent job of vaccinating seniors , the most vulnerable age group. The Florida death rate from Covid is roughly in the middle compared to other states. N.Y.'s death rate is much higher, N.J. has the highest. As we have previously agreed, the Texas power system was unprepared for extreme winter weather. Afaik those responsible were members of an independent consortium of power companies , not a Texas state agency per se. Nonetheless there ought to have been better oversight.

    Mea culpa. I did not post clearly enough on the U.S. economy in 1929 and 1930. After the October , 1929 Stock Market Crash there was a period of economic healing. The market started rising and while a recession was afoot it was far from a Depression. Hoover raised taxes ( Coolidge told him NOT to ) and signed Smoot Hawley ( Coolidge and everyone else told him not to ) and the results were as you posted. Then of course we had the actions of the Fed starting in 1928 ( they tightened BEFORE the Crash ) and kept tightening and failed to be the lender of last resort as major banks started failing. Likewise, as FDR cut spending and raised taxes the Fed tightened yet again and we got a severe recession in late 1937 into 1938.

    While Reagan and Bush Sr. were in office this country was in the middle of transition to a post-industrial economy. Old Rust Belt industries , NYC's garment industry , the textile industry and the industrial heart of states like N.Y. , N.J., Pa. and Ohio all gave way to high tech and service based industries. Pittsburgh used to be the heart of the steel industry. Today its major employers are in services not industrial production. States and cities that transitioned survived and even flourished . Those that didn't like Flint, Detroit, Syracuse etc. went into the toilet. When Clinton was President a lot of the shaking out process had occurred. After Obama we had "You Know Who" and PRE -Covid we had record low unemployment although GDP still lagged.

    For the last time , Clinton RAISED taxes in his FIRST Term and even made the RATE increases retroactive to reach back and collect taxes on 1992 earnings. His first four years had two up years and two not so good as I posted (supra ). His SECOND Term we had four straight years of GDP growth all OVER 4 %. When he raised taxes his increases did NOT restore the top rate to 50% where it had been for FOUR of the Reagan years. In 1986 we had the Tax Reform Bill that eliminated most deductions and credits and gave us 3 basic tax rates the top one being 29%. Bush Sr. raised taxes in 1990 giving us a top rate of 35%. Clinton certainly didn't raise tax RATES to anything remotely resembling what they had been under Carter. In fact , as you refuse to acknowledge ( for some reason I can't begin to fathom ) he CUT taxes in his SECOND Term.

    Japan has a culture that emphasizes work and employment. A prime duty of their corporations is to preserve jobs. Thus while they may have low unemployment they have had stagnant economic growth for at least the last 20 years.

    China's problems are many. Right now they are experiencing a war on capitalism led by Xi and the CCP. They have major problems with corruption. An unhealthy urban population mostly because of horrendous air pollution. A shortage of women. Some estimates say they at least 100 million women short. Whopping debt both public and corporate. Those are just a few of the most recent and highlighted problems All is NOT well in the Middle Kingdom and the really smart money is NOT investing there.

    Leaving aside demand based vs classic definitions of inflation , are you telling me that easy money from the Fed , a weak dollar and excessive government spending do not play any role in fueling inflation ? Starting with his book "A Monetary History of the United States " in 1963 Milton Friedman and Anna Schwartz laid out the case that inflation in particular and the economy in general were affected by monetary policy. He charted the money supply and both inflation and GDP .In subsequent writings he did the same for Germany and Switzerland. The tracking is quite clear. You are free to offer alternate explanations. As with the oil shocks both Germany and Switzerland had increased inflation but LESS than we did. You can have increased demand , a steady supply and low inflation IF the money supply is controlled . At least until supply catches up with demand. In the 1970's it most definitely was NOT in the U.S. and WAS in the other two countries mentioned. Friedman also charted monetary growth and GDP . While there was a lag , GDP tracked monetary policy both up and down. A steady and stable money supply resulted in stable long term growth. Instability resulted in the booms and busts we have seen since the 1920's.

    For some reason you insist on ignoring money as the fuel for the fire of imbalance between supply and demand. Afaic you are half right about the role of supply and demand vis a vis inflation. Both forces play a role in inflation but you refuse to recognize monetary growth and VELOCITY as equally important forces. The overall annual rate of increase in the money supply can be correct and proper but if the velocity ( the rate of injection into and circulation within the economy) is too slow or too fast you can get inflation or even contraction depending. That's what Greenspan gave us in 1991-2 which resulted in a recession that lasted only two quarters. He must have been a closet Clinton voter lol.
    With the oil shocks of the '70's which you like to use as the sole cause of our economic woes at the time, demand did not increase. Supplies were reduced and increased in price. We were caught flat footed and it took quite a while for Detroit to successfully produce more fuel efficient cars that included disasters like the Vega, Pinto and Gremlin.

    The foregoing is why I argue for slow and steady monetary growth. I want the markets to be left alone to achieve equilibrium between supply and demand without tinkering by the Fed. Or would you prefer the Stop , Go, Stop, Go policies of Arthur Burns ?

    Lastly , 1983 tax revenue was based mostly on 1982 incomes and profits. Aside from withholding and Quarterly Estimated tax payments, Income Tax Revenue , both Individual and Corporate is based on the previous year's income. My 2021 Tax Return was for my 2020 income. Wasn't yours ? 1982 was the low point of the worst recession since 1938. I have posted that by 1990 Federal Revenue doubled. We got the deficits we did because of spending. Clinton got the surpluses he did by controlling spending. Taxes and revenue collection for 1983 also included a LOT of LOSSES. Corporate losses and short term ordinary losses were written off in 1983 resulting in lower revenues. Long Term Capital losses and some Corporate losses were also stretched out over the succeeding years. One thing I didn't like about Reagan's tax cut legislation was that it permitted corporations to buy , sell, swap and trade losses. Nonsense like that is why I support a Flat Tax and elimination of Corporate Income Taxes altogether..
    Last edited by Eric Stoner; 09-30-2021 at 08:00 AM.
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    Default Re: Interest rates in the coming months

    Quote Originally Posted by Eric Stoner View Post
    Regardless of whether or not it taxes "income" there is a proposed Net Investment Tax of 3.8 % which will result in a top EFFECTIVE tax rate of 46.4% on the highest earners. I didn't even mention the proposed increases in the Capital Gains tax.
    Not if their income comes from wages.

    Quote Originally Posted by Eric Stoner View Post
    Florida has done an excellent job of vaccinating seniors , the most vulnerable age group. The Florida death rate from Covid is roughly in the middle compared to other states. N.Y.'s death rate is much higher, N.J. has the highest. As we have previously agreed, the Texas power system was unprepared for extreme winter weather. Afaik those responsible were members of an independent consortium of power companies , not a Texas state agency per se. Nonetheless there ought to have been better oversight.
    If you look at their death rate since vaccines became widely available, it's been one of the highest in the country, a lot higher than NJ's or NY's. From what I remember, FL was having a few hundred deaths every day over the summer, before they stopped releasing their daily figures. Texas too. NY and NJ were having 20 or 30.

    Quote Originally Posted by Eric Stoner View Post
    Mea culpa. I did not post clearly enough on the U.S. economy in 1929 and 1930. After the October , 1929 Stock Market Crash there was a period of economic healing. The market started rising and while a recession was afoot it was far from a Depression. Hoover raised taxes ( Coolidge told him NOT to ) and signed Smoot Hawley ( Coolidge and everyone else told him not to ) and the results were as you posted. Then of course we had the actions of the Fed starting in 1928 ( they tightened BEFORE the Crash ) and kept tightening and failed to be the lender of last resort as major banks started failing. Likewise, as FDR cut spending and raised taxes the Fed tightened yet again and we got a severe recession in late 1937 into 1938.

    For the last time , Clinton RAISED taxes in his FIRST Term and even made the RATE increases retroactive to reach back and collect taxes on 1992 earnings. His first four years had two up years and two not so good as I posted (supra ). His SECOND Term we had four straight years of GDP growth all OVER 4 %. When he raised taxes his increases did NOT restore the top rate to 50% where it had been for FOUR of the Reagan years. In 1986 we had the Tax Reform Bill that eliminated most deductions and credits and gave us 3 basic tax rates the top one being 29%. Bush Sr. raised taxes in 1990 giving us a top rate of 35%. Clinton certainly didn't raise tax RATES to anything remotely resembling what they had been under Carter. In fact , as you refuse to acknowledge ( for some reason I can't begin to fathom ) he CUT taxes in his SECOND Term.
    No, Clinton made the rate retroactive to Jan. 1 1993. I don't dispute Clinton cut taxes during his second terms, but the tax cuts were very small, compared to his tax increases. Federal income tax rates were still the same as his first term, and Americans were paying a lot more in taxes during Clinton's 2nd term than when Reagan was in office.

    Quote Originally Posted by Eric Stoner View Post
    Japan has a culture that emphasizes work and employment. A prime duty of their corporations is to preserve jobs. Thus while they may have low unemployment they have had stagnant economic growth for at least the last 20 years.
    Japan has been having slow economic growth due to their population and work force declining in numbers.

    Quote Originally Posted by Eric Stoner View Post
    China's problems are many. Right now they are experiencing a war on capitalism led by Xi and the CCP. They have major problems with corruption. An unhealthy urban population mostly because of horrendous air pollution. A shortage of women. Some estimates say they at least 100 million women short. Whopping debt both public and corporate. Those are just a few of the most recent and highlighted problems All is NOT well in the Middle Kingdom and the really smart money is NOT investing there.
    They're not doing as well now, due to the policies of the current government. From the 1980s to the 2000s, their growth rate was phenomenal. China is currently doing more than any other major economy to move towards renewable energy. They produce the most electric cars and buses in the world, and they're the world leader in solar and wind power output.

    Quote Originally Posted by Eric Stoner View Post
    Leaving aside demand based vs classic definitions of inflation , are you telling me that easy money from the Fed , a weak dollar and excessive government spending do not play any role in fueling inflation ? Starting with his book "A Monetary History of the United States " in 1963 Milton Friedman and Anna Schwartz laid out the case that inflation in particular and the economy in general were affected by monetary policy. He charted he moneey supply and both inflation and GDP .In subsequent writings he did the same for Germany and Switzerland. The tracking is quite clear. You are free to offer alternate explanations. As with the oil shocks both Germany and Switzerland had increased inflation but LESS than we did. You can have increased demand , a steady supply and low inflation IF the money supply is controlled . At least until supply catches up with demand. In the 1970's it most definitely was NOT in the U.S. and WAS in the other two countries mentioned. Friedman also charted monetary growth and GDP . While there was a lag , GDP tracked monetary policy both up and down. A steady and stable money supply resulted in stable long term growth. Instability resulted in the booms and busts we have seen since the 1920's.
    We most likely would have had inflation in the 1970s without the oil embargo, but it would not been as bad as it was. Our economy was affected more than any other major economy by the oil embargo. In the 1970s, the US made up about 6% of the world population, but consumed approximately 1/3 of the world's oil supply. Today it's about 20%. I think that Germany and Switzerland had a supply of oil reserves, and we didn't. Also, gas taxes were much higher in those countries, so the percentage increase in the cost of gas wasn't as high in those countries.

    Quote Originally Posted by Eric Stoner View Post
    For some reason you insist on ignoring money as the fuel for the fire of imbalance between supply and demand. Afaic you are half right about the role of supply and demand vis a vis inflation. Both forces play a role in inflation but you refuse to recognize monetary growth and VELOCITY as equally important forces. The overall annual rate of increase in the money supply can be correct and proper but if the velocity ( the rate of injection into and circulation within the economy) is too slow or too fast you can get inflation or even contraction depending. That's what Greenspan gave us in 1991-2 which resulted in a recession that lasted only two quarters. He must have been a closet Clinton voter lol.
    With the oil shocks of the '70's which you like to use as the sole cause of our economic woes at the time, demand did not increase. Supplies were reduced and increased in price. We were caught flat footed and it took quite a while for Detroit to successfully produce more fuel efficient cars that included disasters like the Vega, Pinto and Gremlin.
    No, monetary growth and velocity do not cause inflation. Here is a graph showing money velocity from 1960 - 2021.



    Money velocity peaked in 1997, yet the inflation rate was 1.7% and 1.6% in 1998. The money supply also increased significantly from 1995 - 1999, yet the inflation rate was close to zero. In 2009 there was a massive increase in both government spending and money supply, but the inflation rate stayed close to zero. Inflation is caused by increase in demand and/or decrease in supply. This is very basic economics. Yes, there wasn't a significant increase in demand for oil in the 1970s, but there was a decrease in supply, which is why prices increased so much. Over time, the high price of oil led to a decrease in demand and an increase in supply, which resulted in the price of oil declining dramatically. That's how economics works.

    Quote Originally Posted by Eric Stoner View Post
    The foregoing is why I argue for slow and steady monetary growth. I want the markets to be left alone to achieve equilibrium between supply and demand without tinkering by the Fed. Or would you prefer the Stop , Go, Stop, Go policies of Arthur Burns ?
    I agree with the Fed targeting an inflation rate of around 2 percent. When the unemployment rate is high, and economic growth is slow, the Fed should increase the money supply and lower interest rates. When we have a low unemployment rate and strong economic growth, the Fed should raise interest rates. IMO, the Fed waited too long to raise rates in the 2000s, which led to the real estate bubble, and then to an economic and financial crisis when the bubble burst.

    Quote Originally Posted by Eric Stoner View Post
    Lastly , 1983 tax revenue was based mostly on 1982 incomes and profits. Aside from withholding and Quarterly Estimated tax payments, Income Tax Revenue , both Individual and Corporate is based on the previous year's income. My 2021 Tax Return was for my 2020 income. Wasn't yours ? 1982 was the low point of the worst recession since 1938. I have posted that by 1990 Federal Revenue doubled. We got the deficits we did because of spending. Clinton got the surpluses he did by controlling spending. Taxes and revenue collection for 1983 also included a LOT of LOSSES. Corporate losses and short term ordinary losses were written off in 1983 resulting in lower revenues. Long Term Capital losses and some Corporate losses were also stretched out over the succeeding years. One thing I didn't like about Reagan's tax cut legislation was that it permitted corporations to buy , sell, swap and trade losses. Nonsense like that is why I support a Flat Tax and elimination of Corporate Income Taxes altogether..
    Most income tax revenue is from the current year. Taxes are taken out of your paycheck. Federal tax revenue did not double. Again, Reagan's tax cuts went into effect in 1982, not 1981. In 1981, the last year before Reagan's tax cuts, tax revenue was $599.3 billion. Tax revenue did not surpass $1.2 trillion until 1994, 13 years and two major tax increases later. Again, here is the chart:

    https://www.taxpolicycenter.org/stat...outlay-summary

    If you're really interested in economics, I strongly suggest taking an Intro to Economics class at a college or university, instead of reading books by right-wing commentators. If you don't have time for this, then try Father Guido Sarducci's Five Minute University. Economics is at approximately 1:40 in the video.


  3. #153
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    Default Re: Interest rates in the coming months

    Quote Originally Posted by eagle2 View Post
    Not if their income comes from wages.



    If you look at their death rate since vaccines became widely available, it's been one of the highest in the country, a lot higher than NJ's or NY's. From what I remember, FL was having a few hundred deaths every day over the summer, before they stopped releasing their daily figures. Texas too. NY and NJ were having 20 or 30.



    No, Clinton made the rate retroactive to Jan. 1 1993. I don't dispute Clinton cut taxes during his second terms, but the tax cuts were very small, compared to his tax increases. Federal income tax rates were still the same as his first term, and Americans were paying a lot more in taxes during Clinton's 2nd term than when Reagan was in office.



    Japan has been having slow economic growth due to their population and work force declining in numbers.



    They're not doing as well now, due to the policies of the current government. From the 1980s to the 2000s, their growth rate was phenomenal. China is currently doing more than any other major economy to move towards renewable energy. They produce the most electric cars and buses in the world, and they're the world leader in solar and wind power output.



    We most likely would have had inflation in the 1970s without the oil embargo, but it would not been as bad as it was. Our economy was affected more than any other major economy by the oil embargo. In the 1970s, the US made up about 6% of the world population, but consumed approximately 1/3 of the world's oil supply. Today it's about 20%. I think that Germany and Switzerland had a supply of oil reserves, and we didn't. Also, gas taxes were much higher in those countries, so the percentage increase in the cost of gas wasn't as high in those countries.



    No, monetary growth and velocity do not cause inflation. Here is a graph showing money velocity from 1960 - 2021.



    Money velocity peaked in 1997, yet the inflation rate was 1.7% and 1.6% in 1998. The money supply also increased significantly from 1995 - 1999, yet the inflation rate was close to zero. In 2009 there was a massive increase in both government spending and money supply, but the inflation rate stayed close to zero. Inflation is caused by increase in demand and/or decrease in supply. This is very basic economics. Yes, there wasn't a significant increase in demand for oil in the 1970s, but there was a decrease in supply, which is why prices increased so much. Over time, the high price of oil led to a decrease in demand and an increase in supply, which resulted in the price of oil declining dramatically. That's how economics works.



    I agree with the Fed targeting an inflation rate of around 2 percent. When the unemployment rate is high, and economic growth is slow, the Fed should increase the money supply and lower interest rates. When we have a low unemployment rate and strong economic growth, the Fed should raise interest rates. IMO, the Fed waited too long to raise rates in the 2000s, which led to the real estate bubble, and then to an economic and financial crisis when the bubble burst.



    Most income tax revenue is from the current year. Taxes are taken out of your paycheck. Federal tax revenue did not double. Again, Reagan's tax cuts went into effect in 1982, not 1981. In 1981, the last year before Reagan's tax cuts, tax revenue was $599.3 billion. Tax revenue did not surpass $1.2 trillion until 1994, 13 years and two major tax increases later. Again, here is the chart:

    https://www.taxpolicycenter.org/stat...outlay-summary

    If you're really interested in economics, I strongly suggest taking an Intro to Economics class at a college or university, instead of reading books by right-wing commentators. If you don't have time for this, then try Father Guido Sarducci's Five Minute University. Economics is at approximately 1:40 in the video.

    I don't understand your first comment. Not WHAT if it comes from wages? The highest earners usually get most of their earnings through capital gains , bonuses and not necessarily salary. Even without the proposed Net Investment Tax there will still be a top proposed rate of 42.6 % PLUS proposed increases in STATE income taxes. For the last time, if you don't like how CNBC analyzed and posted the numbers ( along with numerous other outlets across the political and economic spectrum) please take it up with THEM. According to you, they are ALL wrong and you, of course , are correct. Did you even READ CNBC's report ?

    As for Florida , you are half right. They have had a lot of deaths over the Summer. Almost all of which among the UN-vaccinated. Please look at WHO is NOT getting vaccinated there and elsewhere. Please look at all the Pro- vaccination commercials and PSA's. WHO are they primarily addressed to ? Why is that ? I am admittedly tip toeing around the demographic and political issues. Sorry.

    Alert the Media. We AGREE about Japan !

    Another Media Alert. We pretty much agree about China. The problem is they still burn mountains of coal and their pollution abatement programs are either weak or nonexistent. The health of their urban residents is abysmal. A reason, not the only one, but a major reason for their high Covid death rate was the lousy pulmonary health of a large portion of the residents of cities like Wuhan. A number of respected analysts have said that their renewable energy programs are designed to give them cover while they continue to burn more coal than anyone else and pollute with impunity. For further reading on this and other issues involving China, the posts and writings of Gordon Chang would be an excellent starting point.

    OMG , this is getting ridiculous. We substantially agree about the inflation of the '70's. If we keep this up people are going to talk lol.

    O.K. Now things are back to normal. Once again I must ask if you READ your own link ? First of all it only measures velocity , not overall growth in M2 which of course includes M1 by definition. Nonetheless if we look at YOUR chart , the one YOU posted we clearly see that Friedman was RIGHT. For one thing it clearly shows the results of the policies ( if we stretch the meaning of the word "policy" ) of Arthur Burns at the Fed. Up, down, up, down, speed up, slow down. While your chart does NOT show the inflation rate if you look at Velocity for 1972 and 1973 it is clearly up and we got a nasty dose of inflation in 1974 and 1975. I know, I know, according to you that was all because of increased oil prices. It shows even more clearly what the Fed was doing in the years prior to 1980. When we also got a nasty dose of inflation culminating in inflation of over 10%and interest rates of 20%. It also picks up The Greenspan Dip just prior to the short and shallow recession of 1992.

    As to Fed policy in general and its tinkering with interest rates we will have to agree to disagree. I think the markets should set rates, not the Fed.

    For the last time, you are entitled to your own opinions but NOT your own facts. Reagan's tax cuts were passed in 1981. Part I took effect in CALENDAR year 1982 and Part II in CALENDAR year 1983. Taxpayers in 1982 filed returns based on their incomes and profits for Calendar and TAX Year 1981. In 1983 it was for TAX Year 1982. In 1984 for TAX year 1983 and so on. If you READ what I posted you would have seen that I acknowledged both withholding and quarterly tax payments. There are no withholding taxes for Capital Gains. Taxes for same are owed in the tax year in which the asset is sold. I am not aware of C Corporations paying withholding or estimated taxes so their tax payments ( assuming losses and write offs did not exceed income ) are made the following year. In 1982 for Tax Year 1981 and so on.

    Your last point is really a cheap shot and definitely against the rules. I am tired of your patronizing, condescension , and pretense to some sort of intellectual superiority. To which your failings in reading comprehension alone disqualify you. However I will resist the temptation to respond in kind to your "Mr. Know It All" pontifications or God Forbid ! get snarky . I happen to love Father Guido and saw him perform his " 5 Minute University " routine live and in person while I was in college. He was the opening act for Renaissance and I met and spoke with Don Novello backstage. So I already knew all about : "Economics - Supply and Demand , Supply and Demand ." The fact is I took several Economics courses in college , all taught by Keynesians or Socialists btw. And read the textbooks and other material assigned. All written by Keynesians of course. I also read a LOT of Classical, Free Market economics . Friedman , Hayek , Kirk , Thurow and of more recent vintage Laffer , Kudlow and Moore. My senior thesis was a comparison of the popular views of The Great Depression and what really caused it. I also still read the ravings of Dean Baker and Paul Krugman. For the comic relief if for no other reason. For the last time , please stop personalizing.
    Last edited by Eric Stoner; 09-30-2021 at 12:10 PM.
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    Teddy Roosevelt

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    Default Re: Interest rates in the coming months

    Quote Originally Posted by Eric Stoner View Post
    I don't understand your first comment. Not WHAT if it comes from wages? The highest earners usually get most of their earnings through capital gains , bonuses and not necessarily salary. Even without the proposed Net Investment Tax there will still be a top proposed rate of 42.6 % PLUS proposed increases in STATE income taxes. For the last time, if you don't like how CNBC analyzed and posted the numbers ( along with numerous other outlets across the political and economic spectrum) please take it up with THEM. According to you, they are ALL wrong and you, of course , are correct. Did you even READ CNBC's report ?
    There are many wealthy people in NY who get most of their pay from their salary. Professional athletes, entertainers, CEOs and other executives, doctors, lawyers, etc.. They won't have to the investment tax on their salaries. Also, some Democrats are talking about increasing the maximum you can deduct from state and local taxes, or allowing the full amount to be deductible, which could lower taxes for many wealthy residents in NY and CA.

    Quote Originally Posted by Eric Stoner View Post
    As for Florida , you are half right. They have had a lot of deaths over the Summer. Almost all of which among the UN-vaccinated. Please look at WHO is NOT getting vaccinated there and elsewhere. Please look at all the Pro- vaccination commercials and PSA's. WHO are they primarily addressed to ? Why is that ? I am admittedly tip toeing around the demographic and political issues. Sorry.
    And their governor has banned mask and vaccine mandates, and has appeared at press conferences with anti-vaxx nutjobs. NY has issued vaccine mandates, which has resulted in more peopled getting vaccinated.

    Quote Originally Posted by Eric Stoner View Post
    Alert the Media. We AGREE about Japan !

    Another Media Alert. We pretty much agree about China. The problem is they still burn mountains of coal and their pollution abatement programs are either weak or nonexistent. The health of their urban residents is abysmal. A reason, not the only one, but a major reason for their high Covid death rate was the lousy pulmonary health of a large portion of the residents of cities like Wuhan. A number of respected analysts have said that their renewable energy programs are designed to give them cover while they continue to burn more coal than anyone else and pollute with impunity. For further reading on this and other issues involving China, the posts and writings of Gordon Chang would be an excellent starting point.
    They're also building more coal plants because they're not able to keep up with their growth with just solar, wind, and nuclear.

    Quote Originally Posted by Eric Stoner View Post
    OMG , this is getting ridiculous. We substantially agree about the inflation of the '70's. If we keep this up people are going to talk lol.

    O.K. Now things are back to normal. Once again I must ask if you READ your own link ? First of all it only measures velocity , not overall growth in M2 which of course includes M1 by definition. Nonetheless if we look at YOUR chart , the one YOU posted we clearly see that Friedman was RIGHT. For one thing it clearly shows the results of the policies ( if we stretch the meaning of the word "policy" ) of Arthur Burns at the Fed. Up, down, up, down, speed up, slow down. While your chart does NOT show the inflation rate if you look at Velocity for 1972 and 1973 it is clearly up and we got a nasty dose of inflation in 1974 and 1975. I know, I know, according to you that was all because of increased oil prices. It shows even more clearly what the Fed was doing in the years prior to 1980. When we also got a nasty dose of inflation culminating in inflation of over 10%and interest rates of 20%. It also picks up The Greenspan Dip just prior to the short and shallow recession of 1992.
    Here's a chart showing money growth vs. inflation from 1941 to 2021:



    The black line is the money supply. From 1995 - 1998 there was a significant increase in money supply and money velocity, yet inflation was below 2%. If money supply and money velocity cause inflation, why was inflation so low in 1997 and 1998?

    Quote Originally Posted by Eric Stoner View Post
    As to Fed policy in general and its tinkering with interest rates we will have to agree to disagree. I think the markets should set rates, not the Fed.

    For the last time, you are entitled to your own opinions but NOT your own facts. Reagan's tax cuts were passed in 1981. Part I took effect in CALENDAR year 1982 and Part II in CALENDAR year 1983. Taxpayers in 1982 filed returns based on their incomes and profits for Calendar and TAX Year 1981. In 1983 it was for TAX Year 1982. In 1984 for TAX year 1983 and so on. If you READ what I posted you would have seen that I acknowledged both withholding and quarterly tax payments. There are no withholding taxes for Capital Gains. Taxes for same are owed in the tax year in which the asset is sold. I am not aware of C Corporations paying withholding or estimated taxes so their tax payments ( assuming losses and write offs did not exceed income ) are made the following year. In 1982 for Tax Year 1981 and so on.
    That is what I said. Reagan's tax cuts went into effect in 1982. Yes taxpayers file their returns for the previous year, but they pay their taxes in the current year, from their paycheck deductions. Starting Jan. 1, 1982, taxpayers had less money taken out of their paychecks, due to Reagan's tax cuts.

    Quote Originally Posted by Eric Stoner View Post
    Your last point is really a cheap shot and definitely against the rules. I am tired of your patronizing, condescension , and pretense to some sort of intellectual superiority. To which your failings in reading comprehension alone disqualify you. However I will resist the temptation to respond in kind to your "Mr. Know It All" pontifications or God Forbid ! get snarky . I happen to love Father Guido and saw him perform his " 5 Minute University " routine live and in person while I was in college. He was the opening act for Renaissance and I met and spoke with Don Novello backstage. So I already knew all about : "Economics - Supply and Demand , Supply and Demand ." The fact is I took several Economics courses in college , all taught by Keynesians or Socialists btw. And read the textbooks and other material assigned. All written by Keynesians of course. I also read a LOT of Classical, Free Market economics . Friedman , Hayek , Kirk , Thurow and of more recent vintage Laffer , Kudlow and Moore. My senior thesis was a comparison of the popular views of The Great Depression and what really caused it. I also still read the ravings of Dean Baker and Paul Krugman. For the comic relief if for no other reason. For the last time , please stop personalizing.
    This was meant to be a joke, not a personal attack. I love Father Guido Sarducci too. Sorry if you were offended. That wasn't my intent.

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    Default Re: Interest rates in the coming months

    The consequences of the pro-longed implementation of right-wing economic policies in industrialized countries since the late-1970's and early-1980's also known as "neoliberalism."

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    Default Re: Interest rates in the coming months

    Quote Originally Posted by 305gurl View Post
    The consequences of the pro-longed implementation of right-wing economic policies in industrialized countries since the late-1970's and early-1980's also known as "neoliberalism."
    If only ! I for one would love a return to those policies. 92 consecutive months of economic growth with low inflation ? Where do I sign ?
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    Default Re: Interest rates in the coming months

    Quote Originally Posted by eagle2 View Post
    There are many wealthy people in NY who get most of their pay from their salary. Professional athletes, entertainers, CEOs and other executives, doctors, lawyers, etc.. They won't have to the investment tax on their salaries. Also, some Democrats are talking about increasing the maximum you can deduct from state and local taxes, or allowing the full amount to be deductible, which could lower taxes for many wealthy residents in NY and CA.



    And their governor has banned mask and vaccine mandates, and has appeared at press conferences with anti-vaxx nutjobs. NY has issued vaccine mandates, which has resulted in more peopled getting vaccinated.



    They're also building more coal plants because they're not able to keep up with their growth with just solar, wind, and nuclear.



    Here's a chart showing money growth vs. inflation from 1941 to 2021:



    The black line is the money supply. From 1995 - 1998 there was a significant increase in money supply and money velocity, yet inflation was below 2%. If money supply and money velocity cause inflation, why was inflation so low in 1997 and 1998?



    That is what I said. Reagan's tax cuts went into effect in 1982. Yes taxpayers file their returns for the previous year, but they pay their taxes in the current year, from their paycheck deductions. Starting Jan. 1, 1982, taxpayers had less money taken out of their paychecks, due to Reagan's tax cuts.



    This was meant to be a joke, not a personal attack. I love Father Guido Sarducci too. Sorry if you were offended. That wasn't my intent.
    Let me start by saying that I accept your explanation that you were joking about Father Guido Sarducci. Rock Critic and Gossip Columnist for Il Observatore Romano. My favorite recurring SNL character. Inventor of the "Porta Shrine" and "Life Is a Job". Too bad he never made Monsignor . As he said : " Itsa just politics ". So no apology is necessary and it was very gracious of you to offer one.

    The Dem proposal that I have read does NOT restore the SALT deduction or do anything to increase the existing $10,000 limit. Please, if you differ with how CNBC and other outlets have reported on the proposed tax increases , please send them a strong letter lol.

    I'd rather not get bogged down here with a Covid discussion. There is an entire thread in the Lounge dedicated thereto. As you know, we mostly agree about getting vaccinated.

    Another point of agreement on China ! Have you changed your pills ? Lol. Just kidding.

    Are we looking at the same chart ? In the 1970's we had erratic swings in the money supply and inflation and GDP also went through booms and busts. After 1980 thanks to Mr. Volcker we had relative stability in the money supply. The Ups were less than previously as were the Downs. I NEVER said that inflation and monetary growth moved in lock step together. There is always a lag. Even with anticipatory inflation. I'm sorry but you are off base about the late 1990's. Look at YOUR chart. The one YOU posted. There was an increase in the money supply for those years but, But, BUT it was a controlled and relatively gradual increase. Please look at the increases in M2 for those years and compare it to the increases and decreases under Arthur Burns. There is no resemblance between the two. The trajectory of increase under Burns is much , much higher than it was under Greenspan. And the dips are much steeper. I do not see anything other than relatively stable increases in the money supply from 1995 to about 2000. I am sure you will agree that monetary policy does not occur in a vacuum. When Burns was head of the Fed he had to deal with other problems and forces that Greenspan did not. A devalued Dollar, deficit spending and higher energy prices just to name a few. Plus AFTER Nixon's boneheaded Wage and Price Freeze what happened when he took his hand off the lid ? Wages and prices shot up. In contrast, during the late 1990's we had a strong Dollar, low energy prices, low commodity prices and increasing productivity. We were entering a period of globalization and an overall decrease in poverty worldwide . We were going from deficits from surpluses. Now please look at the tail end of YOUR chart and note the mountainous increase in M2. What are we getting now as a direct result ? High inflation. Look at the stability in M2 from 1960 to 1965. What did we get ? Increased growth with low inflation.



    To quote the lovely Jen Psaki and "circle back" to the original point of this thread, what do we have today ? A weakening dollar , a Fed buying up private assets with freshly printed Dollars, whopping deficits with more on the way , a national debt that has hit 125% of GDP ,increasing jobless claims, ports backed up and stacked with ships waiting to be unloaded ; especially but not limited to L.A. and Long Beach. That's where most of the imports from Asia come into the continental U.S. We also have a self inflicted increase of a dollar a gallon on gasoline since last year plus higher heating oil just in time for the winter heating season. Natural gas has just set a new record after years of good supplies and low prices thanks in part to fracking. The results are a stagnating economy ( aside from supply bottlenecks and Covid distortions and displacements ) and high and rising inflation. We just got another report today of increasing inflation. Too many dollars are chasing too few goods thanks to the Fed and its asset purchases and other policies. Inventories are way behind demand. As you like to point out , that causes inflation and there is no end in sight.

    If you STILL do not think monetary policy does not matter as much as I think it does then a little history might be helpful. Two easy examples are the Frankish Empire under Charlemagne and the Spanish Empire in the 1500''s. Both experienced runaway inflation solely because of monetary shock. After conquering and subduing the Saxons once and for all, the Franks took every scrap of silver and gold they could lay their hands on and brought it back to France. There was no way a feudal economy could grow enough food , make enough clothes or collect enough building supplies to match such a rapid and sudden increase in gold and silver. Likewise the Spanish also had a feudal economy and could not generate enough goods and services to sop up all the gold they were shipping over from Mexico and South America.

    More recently we had a Fed that tightened in 1928 based on fear alone. Like many central banks they feared inflation more than any other threat. Tight money was coupled with overproduction in agriculture. That was centered on excessive wheat cultivation thanks to Wilson's micro-managing during W.W. I. At the time agriculture was a much larger part of our economy employing a much larger percentage of the population than it does now. So when crop prices collapsed as they did the dominoes started to fall. As I have posted numerous times , AFTER the Crash, Hoover and the Fed made horrendous policy choices and turned a recession into a depression.
    Last edited by Eric Stoner; 10-04-2021 at 09:24 AM.
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    Teddy Roosevelt

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    Default Re: Interest rates in the coming months

    Quote Originally Posted by Eric Stoner View Post
    If only ! I for one would love a return to those policies. 92 consecutive months of economic growth with low inflation ? Where do I sign ?
    Huh? We have 40 years of neoliberalism in the U.S. and counting. One thing about liberal economics, it creates a fake economic growth then suddenly collapses. In other words, a boom-bust cycle.

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    Default Re: Interest rates in the coming months

    Quote Originally Posted by 305gurl View Post
    Huh? We have 40 years of neoliberalism in the U.S. and counting. One thing about liberal economics, it creates a fake economic growth then suddenly collapses. In other words, a boom-bust cycle.
    Yes. We've had much more economic stability, increase standard of living, and decline in poverty before neoliberals gained power. We're now seeing for the first time, many in the current generation having a lower standard of living than the previous generation.

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    Default Re: Interest rates in the coming months

    Quote Originally Posted by Eric Stoner View Post
    Let me start by saying that I accept your explanation that you were joking about Father Guido Sarducci. Rock Critic and Gossip Columnist for Il Observatore Romano. My favorite recurring SNL character. Inventor of the "Porta Shrine" and "Life Is a Job". Too bad he never made Monsignor . As he said : " Itsa just politics ". So no apology is necessary and it was very gracious of you to offer one.
    Thank you.

    Quote Originally Posted by Eric Stoner View Post
    The Dem proposal that I have read does NOT restore the SALT deduction or do anything to increase the existing $10,000 limit. Please, if you differ with how CNBC and other outlets have reported on the proposed tax increases , please send them a strong letter lol.
    https://www.cnbc.com/2021/09/15/demo...eduction-.html

    Quote Originally Posted by Eric Stoner View Post
    Are we looking at the same chart ? In the 1970's we had erratic swings in the money supply and inflation and GDP also went through booms and busts. After 1980 thanks to Mr. Volcker we had relative stability in the money supply. The Ups were less than previously as were the Downs. I NEVER said that inflation and monetary growth moved in lock step together. There is always a lag. Even with anticipatory inflation. I'm sorry but you are off base about the late 1990's. Look at YOUR chart. The one YOU posted. There was an increase in the money supply for those years but, But, BUT it was a controlled and relatively gradual increase. Please look at the increases in M2 for those years and compare it to the increases and decreases under Arthur Burns. There is no resemblance between the two. The trajectory of increase under Burns is much , much higher than it was under Greenspan. And the dips are much steeper. I do not see anything other than relatively stable increases in the money supply from 1995 to about 2000. I am sure you will agree that monetary policy does not occur in a vacuum. When Burns was head of the Fed he had to deal with other problems and forces that Greenspan did not. A devalued Dollar, deficit spending and higher energy prices just to name a few. Plus AFTER Nixon's boneheaded Wage and Price Freeze what happened when he took his hand off the lid ? Wages and prices shot up. In contrast, during the late 1990's we had a strong Dollar, low energy prices, low commodity prices and increasing productivity. We were entering a period of globalization and an overall decrease in poverty worldwide . We were going from deficits from surpluses. Now please look at the tail end of YOUR chart and note the mountainous increase in M2. What are we getting now as a direct result ? High inflation. Look at the stability in M2 from 1960 to 1965. What did we get ? Increased growth with low inflation.
    During the 1970s, the money supply was increased at the rate of 13.8%. At its highest level in the 1980s, the money supply increased at 12.8%, yet we had much lower inflation in the 1980s. From 1995 - 1998, the rate of increase in money supply went from 0% to 8.5%, with inflation close to zero. In 2001, 2009, and 2011, the rate of increase in money supply exceeded 10%, yet most years inflation was below 3%. In 2009, inflation was below zero percent. In 2020 - Jan. 2021, the money supply increased by more than 27%, approximately twice as much as it did in the 1970s, yet at 5%, inflation is less than 1/2 of what it was in the 1970s. If increasing the money supply results in increased inflation, why is it that none of these increases in the money supply resulted in any significant increases in inflation?

    Quote Originally Posted by Eric Stoner View Post
    To quote the lovely Jen Psaki and "circle back" to the original point of this thread, what do we have today ? A weakening dollar , a Fed buying up private assets with freshly printed Dollars, whopping deficits with more on the way , a national debt that has hit 125% of GDP ,increasing jobless claims, ports backed up and stacked with ships waiting to be unloaded ; especially but not limited to L.A. and Long Beach. That's where most of the imports from Asia come into the continental U.S. We also have a self inflicted increase of a dollar a gallon on gasoline since last year plus higher heating oil just in time for the winter heating season. Natural gas has just set a new record after years of good supplies and low prices thanks in part to fracking. The results are a stagnating economy ( aside from supply bottlenecks and Covid distortions and displacements ) and high and rising inflation. We just got another report today of increasing inflation. Too many dollars are chasing too few goods thanks to the Fed and its asset purchases and other policies. Inventories are way behind demand. As you like to point out , that causes inflation and there is no end in sight.
    Just because you disagree with having a weak dollar, doesn't mean it's bad. As I've said before, Japan and China had very strong economic growth and increases in living standards, while keeping their currency weak. The national debt of 125% of GDP didn't just happen. Massive increases in debt and deficits have been going on since Reagan's tax cuts. You like to blame it on increased spending, but we didn't even have this much debt after World War 2, when government spending was at it's highest level in history, relative to GDP. If our national debt increase from less than $1 trillion in 1980, to the current $29 trillion we have now, is the result of govt spending as you say, then please explain where we could have cut $28 in trillion in spending over the past 40 years, without having a negative impact on the country, and that the American people would have found acceptable.

    I don't know where you're getting your information from, but jobless claims are not increasing and we don't have a stagnating economy. Jobless claims declined from over 900,000 a week in January to approximately 350,000 a week currently. Annual GDP growth was over 6% the first two quarters. The main reason for the recent slowdown is the covid surge, rather than any fiscal or monetary policies. There wasn't a "self-inflicted" increase in the price of gasoline. Oil production declined significantly during the pandemic, due to a major decline in demand. Oil companies can't just push a button to increase supply. It takes time. Also OPEC plays a major role in the price of oil, and they do not want to sell gasoline at $2 a gallon. They didn't have much choice during the pandemic, but now that demand is back up, that have a lot more pricing power.

    Again, you're confusing dollars with supply and demand. Dollars don't chase goods and services. Individuals and businesses do. Inflation is up due to increases in demand and decreases in supply. The Fed could have kept interest rates up and govt could have kept spending down, and inflation would be at zero or below, but we would have millions more people living in poverty, unemployed, homeless, and going hungry.

    Quote Originally Posted by Eric Stoner View Post
    If you STILL do not think monetary policy does not matter as much as I think it does then a little history might be helpful. Two easy examples are the Frankish Empire under Charlemagne and the Spanish Empire in the 1500''s. Both experienced runaway inflation solely because of monetary shock. After conquering and subduing the Saxons once and for all, the Franks took every scrap of silver and gold they could lay their hands on and brought it back to France. There was no way a feudal economy could grow enough food , make enough clothes or collect enough building supplies to match such a rapid and sudden increase in gold and silver. Likewise the Spanish also had a feudal economy and could not generate enough goods and services to sop up all the gold they were shipping over from Mexico and South America.
    There's no comparison between the economies of countries in the 16th century and today.

    Quote Originally Posted by Eric Stoner View Post
    More recently we had a Fed that tightened in 1928 based on fear alone. Like many central banks they feared inflation more than any other threat. Tight money was coupled with overproduction in agriculture. That was centered on excessive wheat cultivation thanks to Wilson's micro-managing during W.W. I. At the time agriculture was a much larger part of our economy employing a much larger percentage of the population than it does now. So when crop prices collapsed as they did the dominoes started to fall. As I have posted numerous times , AFTER the Crash, Hoover and the Fed made horrendous policy choices and turned a recession into a depression.
    I've been saying all along that the Fed should increase the money supply and lower interest rates during economic downturns.
    Last edited by eagle2; 10-03-2021 at 05:03 PM.

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    Default Re: Interest rates in the coming months

    Quote Originally Posted by eagle2 View Post
    Thank you.



    https://www.cnbc.com/2021/09/15/demo...eduction-.html



    During the 1970s, the money supply was increased at the rate of 13.8%. At its highest level in the 1980s, the money supply increased at 12.8%, yet we had much lower inflation in the 1980s. From 1995 - 1998, the rate of increase in money supply went from 0% to 8.5%, with inflation close to zero. In 2001, 2009, and 2011, the rate of increase in money supply exceeded 10%, yet most years inflation was below 3%. In 2009, inflation was below zero percent. In 2020 - Jan. 2021, the money supply increased by more than 27%, approximately twice as much as it did in the 1970s, yet at 5%, inflation is less than 1/2 of what it was in the 1970s. If increasing the money supply results in increased inflation, why is it that none of these increases in the money supply resulted in any significant increases in inflation?



    Just because you disagree with having a weak dollar, doesn't mean it's bad. As I've said before, Japan and China had very strong economic growth and increases in living standards, while keeping their currency weak. The national debt of 125% of GDP didn't just happen. Massive increases in debt and deficits have been going on since Reagan's tax cuts. You like to blame it on increased spending, but we didn't even have this much debt after World War 2, when government spending was at it's highest level in history, relative to GDP. If our national debt increase from less than $1 trillion in 1980, to the current $29 trillion we have now, is the result of govt spending as you say, then please explain where we could have cut $28 in trillion in spending over the past 40 years, without having a negative impact on the country, and that the American people would have found acceptable.

    I don't know where you're getting your information from, but jobless claims are not increasing and we don't have a stagnating economy. Jobless claims declined from over 900,000 a week in January to approximately 350,000 a week currently. Annual GDP growth was over 6% the first two quarters. The main reason for the recent slowdown is the covid surge, rather than any fiscal or monetary policies. There wasn't a "self-inflicted" increase in the price of gasoline. Oil production declined significantly during the pandemic, due to a major decline in demand. Oil companies can't just push a button to increase supply. It takes time. Also OPEC plays a major role in the price of oil, and they do not want to sell gasoline at $2 a gallon. They didn't have much choice during the pandemic, but now that demand is back up, that have a lot more pricing power.

    Again, you're confusing dollars with supply and demand. Dollars don't chase goods and services. Individuals and businesses do. Inflation is up due to increases in demand and decreases in supply. The Fed could have kept interest rates up and govt could have kept spending down, and inflation would be at zero or below, but we would have millions more people living in poverty, unemployed, homeless, and going hungry.



    There's no comparison between the economies of countries in the 16th century and today.



    I've been saying all along that the Fed should increase the money supply and lower interest rates during economic downturns.
    There may be proposals and discussions about restoring or increasing the SALT deduction BUT they are NOT contained in Biden's Tax proposal.

    According to YOUR numbers and YOUR chart there was greater monetary growth in the 1970's than in the 1980's and thereafter. Please LOOK at your own chart and note the higher trajectory of the increases under Burns and how erratic the highs and lows were. The result was a stagflation cycle that Volcker and Reagan managed to break. I have NEVER been in complete agreement with Friedman and the other University of Chicago monetarists that inflation is a purely monetary phenomenon .Other factors were and are in play. As we have discussed past the point of being boring.

    Japan and China were and are export based economies. The U.S. is import based.

    The deficits have resulted primarily from a voting public that likes getting $1 worth of government and only paying $.75 in taxes to pay for it. Spending has increased dramatically over the last 40 years or so compared to revenues except for the Clinton-Gingrich years of spending restraint. Spending grew less than the revenue increases and thus we had surpluses. Which Bush Jr. AND the Congress squandered. Afaic spending can and should be restrained starting with A for Agriculture all the way through Z for Zion National Park. Eliminate the pork , the crony capitalism , the corporate welfare , the entitlements for people making $100,000 a year and up etc. etc. The biggest items in the Federal Budget are entitlements and transfer payments. Unless and until we get those under control we will have deficits. I have repeatedly said that the ONLY purpose , the SOLE reason for a Tax Code is to enable the Federal government to raise the funds necessary for it to pay its bills. Imo Biden's budget proposals will increase spending ( Free this , free that ) and deficits while stifling the very growth we need to even have a chance to restore fiscal sanity. Biden's own projections only allow for annual growth of 2 % which is grossly inadequate to the task at hand. A related issue is whether our current taxation model is even capable of raising the revenues we need. Which is why we ought to eliminate the tax on corporations. They don't pay it anyway. Their customers do in higher prices ; their workers do in lower wages and benefits and their shareholders do in lower dividends. And we should have a Flat Tax eliminating ALL deductions , credits and tax shelters in exchange for lower rates. I even part company with many of my fellow conservatives by supporting a moderate inheritance tax of about 30% after an exemption for the family home ; the first 640 acres of the family farm or ranch ( that's a square mile of property folks ) and then tax estates of $5 million or more. And I'd knock out a lot of the phony trusts used to avoid such taxes.

    Apparently you are not keeping up to date on jobless claims. You are correct about 2021 as a whole BUT recently new claims for unemployment have been going up. For the last 3 weeks claims are up well beyond estimates and projections. Now it is POSSIBLE that AFTER the DOL cooks the books as hey historically have ( as we have discussed many, many times in the past ) that the overall employment numbers might change . But for now , new jobless claims have increased over the last 3 weeks.

    Let's agree to disagree about Biden's effect on the oil biz. I say his actions ( closing ANWAR to drilling , canceling the Keystone Pipeline etc. ) have affected supplies and prices. He is the guy that begged ( and I use that word on purpose ) OPEC to increase production.

    People and businesses buy goods, services and labor with Dollars. The more dollars in circulation the higher and faster the price increases UNLESS production can keep up. YOUR chart clearly shows that monetary growth has gone way up and we are now seeing the resulting inflation. No matter which inflation index you prefer , the CPI or the ones that include food, energy and housing costs , inflation is going up AT LEAST 4% a year and most likely much higher than that.

    While you are correct that our economy is different from that in Charlemagne's Holy Roman Empire and the Spanish Empire of 1550, human nature has not changed. People still need food , clothing, shelter , fuel for cooking and heating etc. The historical fact is that nothing else changed in Charlemagne's Empire before or after in the influx of a huge treasure trove of loot from the final conquest and subjugation of the Saxons in the late 700's. The result was runaway inflation. Charlemagne was a very smart and learned guy , especially for his time as he could read and write unlike most kings of his time. Before silver started flooding his empire he had already made standardized silver coinage the preferred currency for most transactions . With official mints and severe penalties including death for counterfeiters. New silver mines and a huge influx of silver coins from trade with the Vikings caused another bout of high inflation. ( On a side note I tried to find out of there was a debate between gold and silver advocates as we had in the U.S. in the 1890's. Couldn't find anything.) Prices rose in nominal terms by a factor of six and in real terms by a factor of three. Charlemagne responded with price controls in 794 for grain and other food products to keep the serfs and other low income folks from starving.

    Spain experienced even more acute inflation in the 1550's thanks to nothing else but a dramatic and sudden increase in silver and to a lesser extent gold. Thanks to the great silver mine at Potosi ( at the time in Peru; now in Bolivia ) and increased silver mining by the Germans, Europe in general and Spain in particular were flooded with new silver. A threefold increase in silver resulted in high inflation.

    In both examples nothing else changed except for a sudden and uncontrolled increase in money. How do you explain what happened ?

    As to your last point we agree.
    Last edited by Eric Stoner; 10-05-2021 at 07:50 AM.
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    Default Re: Interest rates in the coming months

    Quote Originally Posted by eagle2 View Post
    Yes. We've had much more economic stability, increase standard of living, and decline in poverty before neoliberals gained power. We're now seeing for the first time, many in the current generation having a lower standard of living than the previous generation.
    Who exactly are the "Neoliberals" ? I'm asking. What policies of theirs do you blame for our current problems ? Again, just asking.

    As to your last sentence there is a lot of truth in it and a LOT of reasons for it. Some , repeat SOME, of it the fault of the current generation. Most the result of forces beyond their control.
    A
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    Teddy Roosevelt

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    Default Re: Interest rates in the coming months

    Quote Originally Posted by Eric Stoner View Post
    There may be proposals and discussions about restoring or increasing the SALT deduction BUT they are NOT contained in Biden's Tax proposal.
    They haven't come out with the final version of the bill. We won't know for sure what's in it, until they do.

    Quote Originally Posted by Eric Stoner View Post
    According to YOUR numbers and YOUR chart there was greater monetary growth in the 1970's than in the 1980's and thereafter. Please LOOK at your own chart and note the higher trajectory of the increases under Burns and how erratic the highs and lows were. The result was a stagflation cycle that Volcker and Reagan managed to break. I have NEVER been in complete agreement with Friedman and the other University of Chicago monetarists that inflation is a purely monetary phenomenon .Other factors were and are in play. As we have discussed past the point of being boring.
    There were major increases in the money supply in 1983, 2001, 2009, and 2012, without causing inflation.



    Are you going to accept this fact or not?

    Quote Originally Posted by Eric Stoner View Post
    Japan and China were and are export based economies. The U.S. is import based.
    No we're not. Most of our goods and services are produced domestically. Imports make up less than 12% of our gdp. Net imports (imports - exports) make up less than 3% of gdp. A weak dollar makes it less costly to produce products in the US, rather than importing them from overseas, which results in more American jobs. It also makes American exports cheaper. When unemployment is high and economic growth is slow, you want to make it cheaper to manufacture goods in the US and you want American goods to be cheaper overseas.

    Quote Originally Posted by Eric Stoner View Post
    The deficits have resulted primarily from a voting public that likes getting $1 worth of government and only paying $.75 in taxes to pay for it. Spending has increased dramatically over the last 40 years or so compared to revenues except for the Clinton-Gingrich years of spending restraint. Spending grew less than the revenue increases and thus we had surpluses. Which Bush Jr. AND the Congress squandered. Afaic spending can and should be restrained starting with A for Agriculture all the way through Z for Zion National Park. Eliminate the pork , the crony capitalism , the corporate welfare , the entitlements for people making $100,000 a year and up etc. etc. The biggest items in the Federal Budget are entitlements and transfer payments. Unless and until we get those under control we will have deficits. I have repeatedly said that the ONLY purpose , the SOLE reason for a Tax Code is to enable the Federal government to raise the funds necessary for it to pay its bills. Imo Biden's budget proposals will increase spending ( Free this , free that ) and deficits while stifling the very growth we need to even have a chance to restore fiscal sanity. Biden's own projections only allow for annual growth of 2 % which is grossly inadequate to the task at hand. A related issue is whether our current taxation model is even capable of raising the revenues we need. Which is why we ought to eliminate the tax on corporations. They don't pay it anyway. Their customers do in higher prices ; their workers do in lower wages and benefits and their shareholders do in lower dividends. And we should have a Flat
    Tax eliminating ALL deductions , credits and tax shelters in exchange for lower rates. I even part company with many of my fellow conservatives by supporting a moderate inheritance tax of about 30% after an exemption for the family home ; the first 640 acres of the family farm or ranch ( that's a square mile of property folks ) and then tax estates of $5 million or more. And I'd knock out a lot of the phony trusts used to avoid such taxes.
    Social Security has been operating at a surplus for the past 40 years. If we were to eliminate it, the deficits would be even higher. Pork makes up less than one percent of the budget. Here's a pie chart showing discretionary spending from 2015, when the deficit was $439 billion. Where would you cut the $439 billion from? It's increased to over $1 trillion since Trump's tax cuts. Non-military discretionary spending was approximately $500 billion. We would probably have to cut all discretionary spending today, in order to balance the budget without increasing taxes.



    Quote Originally Posted by Eric Stoner View Post
    Apparently you are not keeping up to date on jobless claims. You are correct about 2021 as a whole BUT recently new claims for unemployment have been going up. For the last 3 weeks claims are up well beyond estimates and projections. Now it is POSSIBLE that AFTER the DOL cooks the books as hey historically have ( as we have discussed many, many times in the past ) that the overall employment numbers might change . But for now , new jobless claims have increased over the last 3 weeks.
    As I said before, the surge of covid resulted in slower economic growth and less hiring.

    Quote Originally Posted by Eric Stoner View Post
    Let's agree to disagree about Biden's effect on the oil biz. I say his actions ( closing ANWAR to drilling , canceling the Keystone Pipeline etc. ) have affected supplies and prices. He is the guy that begged ( and I use that word on purpose ) OPEC to increase production.
    There was no drilling in ANWAR before Biden took office and the Keystone Pipeline was not in operation. Trump didn't issue drilling permits for ANWAR until his last month in office.

    https://www.cnbc.com/2020/12/04/trum...es-office.html

    Why didn't not drilling in ANWAR and not having the Keystone Pipeline in operation cause the price of gasoline to increase before Biden took office? The current cost for one barrel of oil is approximately $75. It cost approximately $100 a barrel to drill for oil in ANWAR. How would drilling in ANWAR at $100 a barrel, bring down the cost from $75 a barrel?

    Quote Originally Posted by Eric Stoner View Post
    People and businesses buy goods, services and labor with Dollars. The more dollars in circulation the higher and faster the price increases UNLESS production can keep up. YOUR chart clearly shows that monetary growth has gone way up and we are now seeing the resulting inflation. No matter which inflation index you prefer , the CPI or the ones that include food, energy and housing costs , inflation is going up AT LEAST 4% a year and most likely much higher than that.
    It's established that the current inflation is being caused by supply shortages. Please answer my question. In 2020 the Fed increased the money supply approximately 27%. In the 1970's, the Fed increased the money supply approximately 13.7%. In the 1970s, inflation was approximately 14%, so according to your theory, it should be around 27%. Why is it only around 5%?

    Quote Originally Posted by Eric Stoner View Post
    While you are correct that our economy is different from that in Charlemagne's Holy Roman Empire and the Spanish Empire of 1550, human nature has not changed. People still need food , clothing, shelter , fuel for cooking and heating etc. The historical fact is that nothing else changed in Charlemagne's Empire before or after in the influx of a huge treasure trove of loot from the final conquest and subjugation of the Saxons in the late 700's. The result was runaway inflation. Charlemagne was a very smart and learned guy , especially for his time as he could read and write unlike most kings of his time. Before silver started flooding his empire he had already made standardized silver coinage the preferred currency for most transactions . With official mints and severe penalties including death for counterfeiters. New silver mines and a huge influx of silver coins from trade with the Vikings caused another bout of high inflation. ( On a side note I tried to find out of there was a debate between gold and silver advocates as we had in the U.S. in the 1890's. Couldn't find anything.) Prices rose in nominal terms by a factor of six and in real terms by a factor of three. Charlemagne responded with price controls in 794 for grain and other food products to keep the serfs and other low income folks from starving.
    There's no comparison between the Fed's monetary policy, and a king from the 1500s looting gold and silver from other countries.

    Quote Originally Posted by Eric Stoner View Post
    Spain experienced even more acute inflation in the 1550's thanks to nothing else but a dramatic and sudden increase in silver and to a lesser extent gold. Thanks to the great silver mine at Potosi ( at the time in Peru; now in Bolivia ) and increased silver mining by the Germans, Europe in general and Spain in particular were flooded with new silver. A threefold increase in silver resulted in high inflation.

    In both examples nothing else changed except for a sudden and uncontrolled increase in money. How do you explain what happened ?
    There was no monetary policy in either of your examples. In both cases, kings were trying to accumulate as much gold and silver as possible, without regard to the consequences.

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    Default Re: Interest rates in the coming months

    Quote Originally Posted by eagle2 View Post
    They haven't come out with the final version of the bill. We won't know for sure what's in it, until they do.



    There were major increases in the money supply in 1983, 2001, 2009, and 2012, without causing inflation.



    Are you going to accept this fact or not?



    No we're not. Most of our goods and services are produced domestically. Imports make up less than 12% of our gdp. Net imports (imports - exports) make up less than 3% of gdp. A weak dollar makes it less costly to produce products in the US, rather than importing them from overseas, which results in more American jobs. It also makes American exports cheaper. When unemployment is high and economic growth is slow, you want to make it cheaper to manufacture goods in the US and you want American goods to be cheaper overseas.



    Social Security has been operating at a surplus for the past 40 years. If we were to eliminate it, the deficits would be even higher. Pork makes up less than one percent of the budget. Here's a pie chart showing discretionary spending from 2015, when the deficit was $439 billion. Where would you cut the $439 billion from? It's increased to over $1 trillion since Trump's tax cuts. Non-military discretionary spending was approximately $500 billion. We would probably have to cut all discretionary spending today, in order to balance the budget without increasing taxes.





    As I said before, the surge of covid resulted in slower economic growth and less hiring.



    There was no drilling in ANWAR before Biden took office and the Keystone Pipeline was not in operation. Trump didn't issue drilling permits for ANWAR until his last month in office.

    https://www.cnbc.com/2020/12/04/trum...es-office.html

    Why didn't not drilling in ANWAR and not having the Keystone Pipeline in operation cause the price of gasoline to increase before Biden took office? The current cost for one barrel of oil is approximately $75. It cost approximately $100 a barrel to drill for oil in ANWAR. How would drilling in ANWAR at $100 a barrel, bring down the cost from $75 a barrel?



    It's established that the current inflation is being caused by supply shortages. Please answer my question. In 2020 the Fed increased the money supply approximately 27%. In the 1970's, the Fed increased the money supply approximately 13.7%. In the 1970s, inflation was approximately 14%, so according to your theory, it should be around 27%. Why is it only around 5%?



    There's no comparison between the Fed's monetary policy, and a king from the 1500s looting gold and silver from other countries.



    There was no monetary policy in either of your examples. In both cases, kings were trying to accumulate as much gold and silver as possible, without regard to the consequences.
    We have Biden's proposal in hand. There is NO Change to the SALT deduction contained therein. You are right that we do not know what , if anything the Congress will do. Assuming they manage to get anything accomplished.

    For the last time and I will try to go slowly, monetary policy does not occur in a vacuum. If Friedman et. al. were right and inflation resulted solely from monetary policy then things like oil shocks , recessions , increased or decreased spending etc. would not matter. They do. YOU know it. I know it. I thought it was something we actually agreed on. Yes, the Fed increased the money supply in 1983. What was happening in 1981 and 1982 ? A severe recession as Volcker broke the back of inflation. The economy was revving up and production increased. Employment was going up. What happened in 2001 ? After 9/11 what happened to the economy ? The Fed responded and the economy bounced back. In 2009 we were trying to recover from the Financial Crisis. Bernanke at the Fed was trying to keep our financial system from collapsing so an injection of money into the banks was certainly a good idea at the time.
    In contrast we had the Fed policy in the 1970's under Arthur Burns and as I have repeatedly pointed out ( and which you refuse to acknowledge ) the rapid and sudden increases and decreases in M2 led to periods of inflation and then recession before Volcker restored relative stability.

    Nationalpriorities.org is a blatantly biased organization and their publishing leads the league in factual delinquency and incompleteness. I did not include Social Security nor most of Medicare because it is funded by a Trust Fund. Secondly, why are you showing a chart from 2015 ? When OBAMA was President ? More importantly , where is Medicaid on that chart. One of the budget's fastest growing outlays. In any event I would argue that there are plenty of savings and economies to be found throughout the budget. We can start by halving the National Endowments for the Arts and the Humanities. Same for Education and Energy. In fact we could eliminate both departments entirely and have their few essential functions performed by other agencies and departments. We can trace the accelerated decline in educational results to the establishment of the Education Dept. in 1977. We have let the NEA drive the school bus for far too long. Name one major accomplishment ; one challenge met ; one problem solved by the Department of Energy. Why is most of Europe turning away from renewables and going back to burning oil , gas and (God Help Us) Coal ? I could go on and on. Btw, your chart does not even touch on the impending bankruptcy of the Social Security Trust Fund and trillions in other unfunded Federal liabilities. If we confiscate 100% of the wealth of the top 10% of taxpayers it would not be enough to plug the hole.

    As for the increase in jobless claims, I was talking about NEW claims for UNEMPLOYMENT benefits .
    Oil prices ( crude is currently selling for $78 a barrel for WTI and $80 for Brent ) are based on BOTH current supply and demand AND projections for the future. If the U.S. goes from being a net exporter back to a net importer what do YOU think that is going to do to oil prices ?

    Yes, there is an argument for a weak dollar. On balance , I think we are better off with a strong dollar. As we had under Reagan and Clinton. You know, the "Good Old Days".

    For the last time, not all increases in the money supply are bad. Sudden , erratic increases historically have bad effects . They lead directly to increased inflation as YOUR chart clearly demonstrates. Not at the same time as the increases just as recessions do not immediately follow a tightening that produces inter alia an inverted yield curve. But they do follow on the heels of erratic and sudden changes in M2. I NEVER said there was an exact point for point correlation between percentage increase in M2 and inflation. YOU came up with that all by yourself. That said, please take another look at your chart showing M2 and Inflation. If you look you will see a sudden and rapid increase ( almost vertical in trajectory ) in 2020 followed by a sudden almost vertical decrease about half as large as the increase. All YOUR chart does is measure RATES of increase and decrease in M2 ; not total dollars in circulation and it does not measure M3 and M4. A flaw in Friedman's theories was that he did not pay much attention to M3 and M4 wasn't even recognized at the time afaik.
    Friedman et. al. said that steady and stable INCREASE in M2 would lead to steady and stable GDP growth which YOUR chart clearly shows. Please look at 1960 to about 1968. We had it then. Look at the POST -Recession Volcker years. Look at Clintons' Second Term - 1997 to 2000. We certainly had it then. Now compare those periods to the 1970's with Arthur Burns at the helm. Do you agree that there is no comparison to what was going on with the RATE of Monetary growth ( BOTH Up and Down ) under Burns than to the three periods I just listed. Unless I am misunderstanding something, according to you , the changes in M2 didn't matter ? Is THAT really what you are saying ? If so then good luck to you and there is nothing left to discuss. That would put you on some island all by yourself. Even Krugman is not that deep in " LaLa Land".

    According to YOU our current inflation results from supply problems. Most analysts no longer accept "bottlenecks" as an alibi for what is happening now. Today. In October, 2021. They see that there is a lot more to it.

    The historical fact remains that in both examples I cited , a sudden , rapid increase in silver coinage resulted in runaway inflation. If you have another explanation for what happened apart from the radical increase in the money supply, I'd love to read it. And btw, in both examples looting accounted for SOME of the increase. But in both cases there were other sources for the rapid influx of silver. Under Charlemagne there was increased trade with the Vikings who unloaded a lot of the silver that they had looted and extorted from their victims. They would start picking on the Frankish Empire AFTER Charlemagne had died. In the case of the Spanish circa 1550 there was increased production from German silver mines as well as the Potosi mine as I noted supra. What neither had was a printing press as our Fed does today yet in both cases runaway inflation was created by sudden increases in the money supply.
    Last edited by Eric Stoner; 10-06-2021 at 08:04 AM.
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    Default Re: Interest rates in the coming months

    Quote Originally Posted by Eric Stoner View Post
    We have Biden's proposal in hand. There is NO Change to the SALT deduction contained therein. You are right that we do not know what , if anything the Congress will do. Assuming they manage to get anything accomplished.

    For the last time and I will try to go slowly, monetary policy does not occur in a vacuum. If Friedman et. al. were right and inflation resulted solely from monetary policy then things like oil shocks , recessions , increased or decreased spending etc. would not matter. They do. YOU know it. I know it. I thought it was something we actually agreed on. Yes, the Fed increased the money supply in 1983. What was happening in 1981 and 1982 ? A severe recession as Volcker broke the back of inflation. The economy was revving up and production increased. Employment was going up. What happened in 2001 ? After 9/11 what happened to the economy ? The Fed responded and the economy bounced back. In 2009 we were trying to recover from the Financial Crisis. Bernanke at the Fed was trying the keep our financial system from collapsing so an injection of money into the banks was certainly a good idea at the time.
    In contrast we had the Fed policy in the 1970's under Arthur Burns and as I have repeatedly pointed out ( and which you refuse to acknowledge ) the rapid and sudden increases and decreases in M2 led to periods of inflation and then recession before Volcker restored relative stability.
    If you accept that increasing the money supply doesn't automatically cause inflation, then we're in agreement.

    Quote Originally Posted by Eric Stoner View Post
    Nationalpriorities.org is a blatantly biased organization and their publishing leads the league in factual delinquency and incompleteness. I did not include Social Security nor most of Medicare because it is funded by a Trust Fund. Secondly, why are you showing a chart from 2015 ? When OBAMA was President ? More importantly , where is Medicaid on that chart. One of the budget's fastest growing outlays. In any event I would argue that there are plenty of savings and economies to be found throughout the budget. We can start by halving the National Endowments for the Arts and the Humanities. Same for Education and Energy. In fact we could eliminate both departments entirely and have their few essential functions performed by other agencies and departments. We can trace the accelerated decline in educational results to the establishment of the Education Dept. in 1977. We have let the NEA drive the school bus for far too long. Name one major accomplishment ; one challenge met ; one problem solved by the Department of Energy. Why is most of Europe turning away from renewables and going back to burning oil , gas and (God Help Us) Coal ? I could go on and on. Btw, your chart does not even touch on the impending bankruptcy of the Social Security Trust Fund and trillions in other unfunded Federal liabilities. If we confiscate 100% of the wealth of the top 10% of taxpayers it would not be enough to plug the hole.
    It's a pie chart with dollar amounts, not an opinion piece. What difference does it make who posts the figures? That was the most current chart I could find. If you can find something more current, feel free to post it. Medicaid is non-discretionary spending. Most of the cuts you recommend wouldn't be much more than rounding errors. The NEA's budget for 2020 was $162 million. In 2019, the deficit was close to $1 trillion. How do you propose we bring this $1 trillion down to zero, without a tax increase? The total wealth of the top one percent of Americans is $34 trillion. They have enough wealth to pay off our entire national debt, and still have another $5 trillion left over.

    Who says Europe is going to back to oil, gas, and coal? In 2020, Germany got approximately 46% of their energy from renewables.

    Quote Originally Posted by Eric Stoner View Post
    As for the increase in jobless claims, I was talking about NEW claims for UNEMPLOYMENT benefits .
    Oil prices ( crude is currently selling for $78 a barrel for WTI and $80 for Brent ) are based on BOTH current supply and demand AND projections for the future. If the U.S. goes from being a net exporter back to a net importer what do YOU think that is going to do to oil prices ?
    As I said before, economic growth slowed from the surge in covid. It doesn't make any difference whether the US is a net importer or exporter of oil. US producers are going to sell oil at the market rate. Oil prices are based on the worldwide supply and demand. It makes no difference how much is produced in the US. We were a net importer of oil in 1995 when the price of gas was $1.15 a gallon. The best way to reduce the amount of money Americans spend on gasoline is to buy more fuel-efficient vehicles or electric vehicles.

    Quote Originally Posted by Eric Stoner View Post
    Yes, there is an argument for a weak dollar. On balance , I think we are better off with a strong dollar. As we had under Reagan and Clinton. You know, the "Good Old Days".
    In 1999, the Euro was worth $1.14. Today it's worth $1.16. In 1999, the dollar was worth 114 yen. Today it's worth 112 yen. The dollar's value compared to other major currencies hasn't changed much over the past 22 years.

    Quote Originally Posted by Eric Stoner View Post
    For the last time, not all increases in the money supply are bad. Sudden , erratic increases historically have bad effects . They lead directly to increased inflation as YOUR chart clearly demonstrates. Not at the same time as the increases just as recessions do not immediately follow a tightening that produces inter alia an inverted yield curve. But they do follow on the heels of erratic and sudden changes in M2. I NEVER said there was an exact point for point correlation between percentage increase in M2 and inflation. YOU came up with that all by yourself. That said, please take another look at your chart showing M2 and Inflation. If you look you will see a sudden and rapid increase ( almost vertical in trajectory ) in 2020 followed by a sudden almost vertical decrease about half as large as the increase. All YOUR chart does is measure RATES of increase and decrease in M2 ; not total dollars in circulation and it does not measure M3 and M4. A flaw in Friedman's theories was that he did not pay much attention to M3 and M4 wasn't even recognized at the time afaik.
    Friedman et. al. said that steady and stable INCREASE in M2 would lead to steady and stable GDP growth which YOUR chart clearly shows. Please look at 1960 to about 1968. We had it then. Look at the POST -Recession Volcker years. Look at Clintons' Second Term - 1997 to 2000. We certainly had it then. Now compare those periods to the 1970's with Arthur Burns at the helm. Do you agree that there is no comparison to what was going on with the RATE of Monetary growth ( BOTH Up and Down ) under Burns than to the three periods I just listed. Unless I am misunderstanding something, according to you , the changes in M2 didn't matter ? Is THAT really what you are saying ? If so then good luck to you and there is nothing left to discuss. That would put you on some island all by yourself. Even Krugman is not that deep in " LaLa Land".
    Again, I said money supply was part of the cause of inflation in the 1970s, but it would not have been as bad as it was without the oil embargo.

    Quote Originally Posted by Eric Stoner View Post
    According to YOU our current inflation results from supply problems. Most analysts no longer accept "bottlenecks" as an alibi for what is happening now. Today. In October, 2021. They see that there is a lot more to it.
    The CPI rose .3% in August after increasing .5% in July. As I said before, we could have gotten inflation down to zero or below if the Fed didn't increase the money supply and lower interest rates, and if the federal government didn't spend over $1 trillion in stimulus, but we would have ended up with millions more Americans living in poverty, homeless, and going hungry. Inflation has not been the biggest concern for the past year and a half.

    Quote Originally Posted by Eric Stoner View Post
    The historical fact remains that in both examples I cited , a sudden , rapid increase in silver coinage resulted in runaway inflation. If you have another explanation for what happened apart from the radical increase in the money supply, I'd love to read it. And btw, in both examples looting accounted for SOME of the increase. But in both cases there were other sources for the rapid influx of silver. Under Charlemagne there was increased trade with the Vikings who unloaded a lot of the silver that they had looted and extorted from their victims. They would start picking on the Frankish Empire AFTER Charlemagne had died. In the case of the Spanish circa 1550 there was increased production from German silver mines as well as the Potosi mine as I noted supra. What neither had was a printing press as our Fed does today yet in both cases runaway inflation was created by sudden increases in the money supply.
    In the Middle ages and the 1500s, the monetary policy of most governments was to accumulate as much gold and silver as possible, without regard for the consequences.
    Last edited by eagle2; 10-06-2021 at 12:32 AM.

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    Default Re: Interest rates in the coming months

    Quote Originally Posted by eagle2 View Post
    If you accept that increasing the money supply doesn't automatically cause inflation, then we're in agreement.



    It's a pie chart with dollar amounts, not an opinion piece. What difference does it make who posts the figures? That was the most current chart I could find. If you can find something more current, feel free to post it. Medicaid is non-discretionary spending. Most of the cuts you recommend wouldn't be much more than rounding errors. The NEA's budget for 2020 was $162 million. In 2019, the deficit was close to $1 trillion. How do you propose we bring this $1 trillion down to zero, without a tax increase? The total wealth of the top one percent of Americans is $34 trillion. They have enough wealth to pay off our entire national debt, and still have another $5 trillion left over.

    Who says Europe is going to back to oil, gas, and coal? In 2020, Germany got approximately 46% of their energy from renewables.



    As I said before, economic growth slowed from the surge in covid. It doesn't make any difference whether the US is a net importer or exporter of oil. US producers are going to sell oil at the market rate. Oil prices are based on the worldwide supply and demand. It makes no difference how much is produced in the US. We were a net importer of oil in 1995 when the price of gas was $1.15 a gallon. The best way to reduce the amount of money Americans spend on gasoline is to buy more fuel-efficient vehicles or electric vehicles.



    In 1999, the Euro was worth $1.14. Today it's worth $1.16. In 1999, the dollar was worth 114 yen. Today it's worth 112 yen. The dollar's value compared to other major currencies hasn't changed much over the past 22 years.



    Again, I said money supply was part of the cause of inflation in the 1970s, but it would not have been as bad as it was without the oil embargo.



    The CPI rose .3% in August after increasing .5% in July. As I said before, we could have gotten inflation down to zero or below if the Fed didn't increase the money supply and lower interest rates, and if the federal government didn't spend over $1 trillion in stimulus, but we would have ended up with millions more Americans living in poverty, homeless, and going hungry. Inflation has not been the biggest concern for the past year and a half.



    In the Middle ages and the 1500s, the monetary policy of most governments was to accumulate as much gold and silver as possible, without regard for the consequences.
    If nothing else, our back and forth has at least shaved off the edges of some of our points of disagreement.

    I have argued against sudden and erratic increases and decreases in the money supply. UNLESS the FED is responding to an emergency like the Stock Market Crash of 1987 ; the post 9/11 slowdown ; the 2008 Financial crisis etc.

    The NEH and NEA are just examples of spending we do not need and which government ought to shy away from. I could easily find hundreds of billions is cuts and savings in the Federal budget. For another thing I would reduce the number of Admirals and Generals by 50%. But as we both know these are just pipe dreams ; fantasies. Just like wealth confiscation is never going to happen. Not that anything of the sort ought to occur.

    Does the law of Supply and Demand apply to oil or doesn't it ? From your posts I thought you agreed it did. If we increase domestic production that will increase supply AND put pressure on OPEC to increase production to maintain their market share.

    If you look at the most recent reports Europe in general and Germany in particular are burning more fossil fuels than before. While still using renewables. Apparently they want the redundancy and are trying to maintain economic growth. According to Instituteforenergyresearch.org increased reliance on wind has led to increased reliance on fossil fuels. Remember Texas ? The Germans and other Europeans obviously do. Plus they are now even more reliant on Russian natural gas than previously thanks to Biden and his idiotic policies.

    Your point about the relative value of the Dollar vs. the Euro and the Yen is what ? The Dollar today is strong relative to the Euro not so much because it is so strong but because the Euro is so weak. It is down substantially from previous highs of around $1.30 . The Canadian and Australian Dollars are both up vs. the American Dollar. The Pound has been relatively stable as of late after a sharp decline vs. the Dollar under Trump. The Dollar vs. the Swiss Franc has been wavering over and under a roughly par value for months.

    WHEN did you EVER concede that the monetary policies of Arthur Burns contributed to the economic problems of the 1970's ? If you ever said anything resembling that then I certainly missed it and will apologize. As far as I can remember you blamed it all on OIL PRICES . I ( ME ! this guy ! ) was the one who pointed to other countries that had to weather the same oil shocks and did so with LESS inflation than we had because they did not have Arthur Burns running their central banks. Likewise, WHEN did you never blame the recent rise in inflation on the current wild and crazy spending ( MY adjectives, NOT yours ) ? We'll have to agree to disagree about the desirability and effectiveness of the programs designed to respond to the Covid slowdowns. Or even the desirability and effectiveness of the shutdowns themselves. Please, THAT and related issues were hashed out in painful detail and boring repetition in the "Covid News" and related threads in The Lounge. Let's leave them there if we could and focus on the here and now.

    Your view of monetary history vis a vis Charlemagne's time and the 16th Century Spanish Empire is simplistic and incomplete. YOU are trying to pretend that the sudden increase in silver supplies in BOTH cases had nothing to do with the runaway inflation that occurred. For the THIRD time, how do YOU explain the inflation that occurred ? Was it just an amazing coincidence ?
    Last edited by Eric Stoner; 10-07-2021 at 08:30 AM.
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    Default Re: Interest rates in the coming months

    Quote Originally Posted by Eric Stoner View Post
    The NEH and NEA are just examples of sending we do not need and which government ought to shy away from. I could easily find hundreds of billions is cuts and savings in the Federal budget. For another thing I would reduce the number of Admirals and Generals by 50%. But as we both know these are just pipe dreams ; fantasies. Just like wealth confiscation is never going to happen. Not that anything of the sort ought to occur.
    In 2019, the last budget before the pandemic, the budget deficit was approximately $1 trillion. If you cut hundreds of billions of dollars from the budget, there would still be a massive deficit.

    Quote Originally Posted by Eric Stoner View Post
    Does the law of Supply and Demand apply to oil or doesn't it ? From your posts I thought you agreed it did. If we increase domestic production that will increase supply AND put pressure on OPEC to increase production to maintain their market share.
    A modest increase in oil production would have little effect on the price of gasoline. In 2020, before Biden was President. US oil production was less than 15% of world production.

    https://www.visualcapitalist.com/map...tion-by-state/

    Even a 10 or 20 percent increase in US oil production would result in a worldwide increase of 1.5 - 3 percent. As I mentioned before, it cost $100 a barrel to extract oil from ANWAR, so allowing drilling there would do nothing to bring down the price. OPEC's main concern is maintaining the price of oil. That is the entire purpose of the organization. In the past, Saudi Arabia has been willing to dramatically cut production to maintain the price.

    Getting away from using gasoline to power our vehicles would do far more to end our dependence on oil.

    Quote Originally Posted by Eric Stoner View Post
    If you look at the most recent reports Europe in general and Germany in particular are burning more fossil fuels than before. While still using renewables. Apparently they want the redundancy and are trying to maintain economic growth. According to Instituteforenergyresearch.org increased reliance on wind has led to increased reliance on fossil fuels. Remember Texas ? The Germans and other Europeans obviously do. Plus they are now even more reliant on Russian natural gas than previously thanks to Biden and his idiotic policies.
    Wind power had nothing to do with the blackouts in TX. Denmark has no problem generating electricity from wind in freezing weather. With battery storage, wind power is now more reliable than ever. In the past, when the wind slowed, it could take hours to power up a backup plant. With battery storage, additional power can be added instantaneously. In South Australia, where wind power is widely used, they would frequently have have blackouts when the wind died down, while the gas powered plants powered up. Since they replaced these plants with battery packs, blackouts have been eliminated. There's a good chance you'll be getting some of your power from wind power and battery packs in the near future.

    https://www.rechargenews.com/transit...rid/2-1-932527

    Just because you disagree with a policy, doesn't make it idiotic.

    Quote Originally Posted by Eric Stoner View Post
    Your point about the relative value of the Dollar vs. the Euro and the Yen is what ? The Dollar today is strong relative to the Euro not so much because it is so strong but because the Euro is so weak. It is down substantially from previous highs of around $1.30 . The Canadian and Australian Dollars are both up vs. the American Dollar. The Pound has been relatively stable as of late after a sharp decline vs. the Dollar under Trump. The Dollar vs. the Swiss Franc has been wavering over and under a roughly par value for months.
    Japan and the EU are two of our biggest trading partners.

    Quote Originally Posted by Eric Stoner View Post
    WHEN did you EVER concede that the monetary policies of Arthur Burns contributed to the economic problems of the 1970's ? If you ever said anything resembling that then I certainly missed it and will apologize. As far as I can remember you blamed it all on OIL PRICES . I ( ME ! this guy ! ) was the one who pointed to other countries that had to weather the same oil shocks and did so with LESS inflation than we had because they did not have Arthur Burns running their central banks. Likewise, WHEN did you never blame the recent rise in inflation on the current wild and crazy spending ( MY adjectives, NOT yours ) ? We'll have to agree to disagree about the desirability and effectiveness of the programs designed to respond to the Covid slowdowns. Or even the desirability and effectiveness of the shutdowns themselves. Please, THAT and related issues were hashed out in painful detail and boring repetition in the "Covid News" and related threads in The Lounge. Let's leave them there if we could and focus on the here and now.
    Quote Originally Posted by eagle2 View Post
    We most likely would have had inflation in the 1970s without the oil embargo, but it would not been as bad as it was. Our economy was affected more than any other major economy by the oil embargo. In the 1970s, the US made up about 6% of the world population, but consumed approximately 1/3 of the world's oil supply. Today it's about 20%. I think that Germany and Switzerland had a supply of oil reserves, and we didn't. Also, gas taxes were much higher in those countries, so the percentage increase in the cost of gas wasn't as high in those countries.
    Quote Originally Posted by Eric Stoner View Post
    Your view of monetary history vis a vis Charlemagne's time and the 16th Century Spanish Empire is simplistic and incomplete. YOU are trying to pretend that the sudden increase in silver supplies in BOTH cases had nothing to do with the runaway inflation that occurred. For the THIRD time, how do YOU explain the inflation that occurred ? Was it just an amazing coincidence ?
    I never said that increasing the money supply never leads to inflation. I said increasing the money supply doesn't always lead to inflation. Inflation occurs when demand rises faster than supply, or supply decreases more than demand. If increasing the money supply leads to demand increasing faster than supply, then you're going to end up with inflation.
    Last edited by eagle2; 10-07-2021 at 01:10 AM.

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    Default Re: Interest rates in the coming months

    Quote Originally Posted by eagle2 View Post
    In 2019, the last budget before the pandemic, the budget deficit was approximately $1 trillion. If you cut hundreds of billions of dollars from the budget, there would still be a massive deficit.



    A modest increase in oil production would have little effect on the price of gasoline. In 2020, before Biden was President. US oil production was less than 15% of world production.

    https://www.visualcapitalist.com/map...tion-by-state/

    Even a 10 or 20 percent increase in US oil production would result in a worldwide increase of 1.5 - 3 percent. As I mentioned before, it cost $100 a barrel to extract oil from ANWAR, so allowing drilling there would do nothing to bring down the price. OPEC's main concern is maintaining the price of oil. That is the entire purpose of the organization. In the past, Saudi Arabia has been willing to dramatically cut production to maintain the price.

    Getting away from using gasoline to power our vehicles would do far more to end our dependence on oil.



    Wind power had nothing to do with the blackouts in TX. Denmark has no problem generating electricity from wind in freezing weather. With battery storage, wind power is now more reliable than ever. In the past, when the wind slowed, it could take hours to power up a backup plant. With battery storage, additional power can be added instantaneously. In South Australia, where wind power is widely used, they would frequently have have blackouts when the wind died down, while the gas powered plants powered up. Since they replaced these plants with battery packs, blackouts have been eliminated. There's a good chance you'll be getting some of your power from wind power and battery packs in the near future.

    https://www.rechargenews.com/transit...rid/2-1-932527

    Just because you disagree with a policy, doesn't make it idiotic.



    Japan and the EU are two of our biggest trading partners.







    I never said that increasing the money supply never leads to inflation. I said increasing the money supply doesn't always lead to inflation. Inflation occurs when demand rises faster than supply, or supply decreases more than demand. If increasing the money supply leads to demand increasing faster than supply, then you're going to end up with inflation.
    First things first. You are right. I was wrong. I apologize for missing your concession that we would have had inflation in the 1970's regardless of the oil shocks. In the words of Steve Martin : " I FORGOT " lol.

    As far as Biden's energy policies ( if we can call them that ) , he has done nothing except hamper our domestic oil production and made us even more dependent on OPEC. I have consistently favored an "All of the above" approach to energy. Wind, solar , NUCLEAR and increased domestic production.
    I do not know where you got your cost of $100 barrel to extract ANWAR oil. Not saying you are wrong. Just that I did a search and could not come up with that or any other number. I AGREE with you that if it does in fact cost $100 then it is not economically viable. Not with the world price around $75 - 80 barrel. I DO know that ANWAR oil is "light and sweet" meaning that it is easy and cheap to refine. As for the waiver Biden granted for the Russian gas pipeline, how do YOU defend it ? I thought we were supposed to be punishing Putin for his adventurism and bullying ? But what do I know. Biden's poll ratings speak for themselves. Just wait until the average American family realizes that HIS policies are costing them at least an extra $2100 a year in increased costs. And that is without any tax increases. Yet !

    Was I imagining things when Texas had numerous wind turbines freeze up and go offline ? I thought we AGREED that the failure of the Texas power consortium to winterize its turbines and have a backup means of generation caused the problems they experienced a few months ago. Or did I miss something ?

    Good for Denmark et. al. I have nothing against wind power. I said what has been widely reported. That Europe has partly gone back to burning fossil fuels IN ADDITION to wind and solar. Not in place of . In fact they are facing a serious shortage of natural gas. Prices are at a 12 year high and several European countries do not have enough gas stored up to get through the coming winter. Stockpiles are running 20% below normal.
    Australia is an interesting case. It is perfect for solar as they get a LOT of sun. Pretty much year round. And Western Australia gets consistent and strong winds perfect for wind power. And it almost never , ever goes below freezing in any part of the country.

    I still do not understand your point concerning the Dollar vs. The Euro and the Yen . But whatever.

    Your last point appears to be just a rehash of your demand based inflation theories.. In the examples I cited NOTHING else happened except for a sudden and large increase in the money supply. There were no crop failures or the like to decrease food supplies. In fact, there was increased trade in foodstuffs throughout Europe. The Spanish inflation did coincide with the Reformation BUT that did not stop German silver mines from increasing production and for that silver to circulate throughout Europe . The story was pretty similar on a macro basis during Charlemagne's time. All that said, it appears we have reached a modicum of agreement that monetary policy does matter. Not as much as Friedman et. al. contended but it is a major factor in the economy.
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    Default Re: Interest rates in the coming months

    Quote Originally Posted by Eric Stoner View Post
    First things first. You are right. I was wrong. I apologize for missing your concession that we would have had inflation in the 1970's regardless of the oil shocks. In the words of Steve Martin : " I FORGOT " lol.
    I didn't concede anything. I never denied it.

    Quote Originally Posted by Eric Stoner View Post
    As far as Biden's energy policies ( if we can call them that ) , he has done nothing except hamper our domestic oil production and made us even more dependent on OPEC. I have consistently favored an "All of the above" approach to energy. Wind, solar , NUCLEAR and increased domestic production.
    I do not know where you got your cost of $100 barrel to extract ANWAR oil. Not saying you are wrong. Just that I did a search and could not come up with that or any other number. I AGREE with you that if it does in fact cost $100 then it is not economically viable. Not with the world price around $75 - 80 barrel. I DO know that ANWAR oil is "light and sweet" meaning that it is easy and cheap to refine. As for the waiver Biden granted for the Russian gas pipeline, how do YOU defend it ? I thought we were supposed to be punishing Putin for his adventurism and bullying ? But what do I know. Biden's poll ratings speak for themselves. Just wait until the average American family realizes that HIS policies are costing them at least an extra $2100 a year in increased costs. And that is without any tax increases. Yet !
    https://www.cnbc.com/2020/12/04/trum...es-office.html

    Energy industry experts are now looking at the economics of drilling for oil in Alaska’s Arctic Wildlife Refuge. The problem: It would cost an estimated average of $100 a barrel to extract oil from that part of Alaska, says Moody’s Analytics energy economist Chris Lafakis, and the current price of crude is under $50.
    We were discussing domestic energy supply. What does Russia's pipeline have to do with it? There's no basis for your statement that HIS policies are costing them at least an extra $2100 a year in increased costs.

    Quote Originally Posted by Eric Stoner View Post
    Was I imagining things when Texas had numerous wind turbines freeze up and go offline ? I thought we AGREED that the failure of the Texas power consortium to winterize its turbines and have a backup means of generation caused the problems they experienced a few months ago. Or did I miss something ?
    I never agreed with that. It was their power grid that wasn't able to operate in the freezing weather, not just wind turbines. Gas and coal plants had the same problem.

    Quote Originally Posted by Eric Stoner View Post
    Good for Denmark et. al. I have nothing against wind power. I said what has been widely reported. That Europe has partly gone back to burning fossil fuels IN ADDITION to wind and solar. Not in place of . In fact they are facing a serious shortage of natural gas. Prices are at a 12 year high and several European countries do not have enough gas stored up to get through the coming winter. Stockpiles are running 20% below normal.
    Australia is an interesting case. It is perfect for solar as they get a LOT of sun. Pretty much year round. And Western Australia gets consistent and strong winds perfect for wind power. And it almost never , ever goes below freezing in any part of the country.
    Europe never stopped burning fossil fuel, but they're getting more and more energy from wind and solar. As of 2020, Denmark was getting close to half of their electricity from wind power.

    https://www.statista.com/statistics/...ge-in-denmark/

    That's more than twice as much as they were getting in 2010.

    Quote Originally Posted by Eric Stoner View Post
    I still do not understand your point concerning the Dollar vs. The Euro and the Yen . But whatever.

    Your last point appears to be just a rehash of your demand based inflation theories.. In the examples I cited NOTHING else happened except for a sudden and large increase in the money supply. There were no crop failures or the like to decrease food supplies. In fact, there was increased trade in foodstuffs throughout Europe. The Spanish inflation did coincide with the Reformation BUT that did not stop German silver mines from increasing production and for that silver to circulate throughout Europe . The story was pretty similar on a macro basis during Charlemagne's time. All that said, it appears we have reached a modicum of agreement that monetary policy does matter. Not as much as Friedman et. al. contended but it is a major factor in the economy.
    You don't seem to understand the concept that no matter how much money there is in the economy, if individuals and businesses aren't spending it, there's not going to be inflation. There was inflation in the 16th century because people were buying more stuff with all of the extra gold. If people just took all that extra gold and locked it up in their homes, there would not have been any inflation. In 2009 and 2010, the Fed increased the money supply and brought interest rates close to zero percent. According to your theory, this should have caused high inflation, and you even insisted that it would. Instead, inflation was close to zero. In 2010, American corporations had a record levels of cash of more than $1 trillion. According to your theory, this should have led to a massive increase in business investment and hiring. It didn't. You consistently ignore the basic laws of supply and demand. If the Fed increases the money supply and lowers interest rates, and American consumers buy more goods and services because of it, then it could lead to inflation if supplies can't keep up with demand, but businesses cannot sell products for any more than buyers are willing to pay.

    You also don't seem to understand the concept that when the dollar is strong, it makes it more expensive to manufacture products here, so more manufacturing will be moved offshore. It also makes American products more expensive overseas, so other countries buy fewer American products. This is a bad thing when we have a high unemployment rate and slow economic growth.
    Last edited by eagle2; 10-07-2021 at 08:49 PM.

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    Default Re: Interest rates in the coming months

    Quote Originally Posted by eagle2 View Post
    I didn't concede anything. I never denied it.



    https://www.cnbc.com/2020/12/04/trum...es-office.html



    We were discussing domestic energy supply. What does Russia's pipeline have to do with it? There's no basis for your statement that HIS policies are costing them at least an extra $2100 a year in increased costs.



    I never agreed with that. It was their power grid that wasn't able to operate in the freezing weather, not just wind turbines. Gas and coal plants had the same problem.



    Europe never stopped burning fossil fuel, but they're getting more and more energy from wind and solar. As of 2020, Denmark was getting close to half of their electricity from wind power.

    https://www.statista.com/statistics/...ge-in-denmark/

    That's more than twice as much as they were getting in 2010.



    You don't seem to understand the concept that no matter how much money there is in the economy, if individuals and businesses aren't spending it, there's not going to be inflation. There was inflation in the 16th century because people were buying more stuff with all of the extra gold. If people just took all that extra gold and locked it up in their homes, there would not have been any inflation. In 2009 and 2010, the Fed increased the money supply and brought interest rates close to zero percent. According to your theory, this should have caused high inflation, and you even insisted that it would. Instead, inflation was close to zero. In 2010, American corporations had a record levels of cash of more than $1 trillion. According to your theory, this should have led to a massive increase in business investment and hiring. It didn't. You consistently ignore the basic laws of supply and demand. If the Fed increases the money supply and lowers interest rates, and American consumers buy more goods and services because of it, then it could lead to inflation if supplies can't keep up with demand, but businesses cannot sell products for any more than buyers are willing to pay.

    You also don't seem to understand the concept that when the dollar is strong, it makes it more expensive to manufacture products here, so more manufacturing will be moved offshore. It also makes American products more expensive overseas, so other countries buy fewer American products. This is a bad thing when we have a high unemployment rate and slow economic growth.
    OK but you do agree that the money supply is an important factor.

    Thank you for the link. If true then ANWAR oil is not economically viable at this time.

    Cancelling the Keystone Pipeline, restricting drilling on public lands and other Biden policies are affecting domestic production. I pointed out Biden's granting of a waiver for Putin's new pipeline as an example of the incoherence of Biden's foreign policy and energy policy. Gasoline is selling for a dollar a gallon more than this time last year. Natural gas is at a 12 year high. Home heating oil is going up and up just in time for winter. The increases in food prices ALONE is costing the average American family an extra $2100 a year. The CPI does not include food, housing or energy costs. Inflation is running at a 30 year high.
    Our government is now giving out $20,000 grants for down payments on houses. Housing prices were already going way up without the extra subsidy.
    Biden's proposed tax increases will take more money out of American pockets. Higher corporate taxes result in higher prices and lower pay and lower dividends.

    You must know more about the Texas power grid than I do. The news reports I watched and stories I read said that : 1. Texas gets a LOT of its electricity from wind power ; 2. The power consortium did not winterize its turbines and did not have adequate back up systems and 3. It took a while for Texas to get its system back online and to buy additional power from neighboring systems .

    Denmark is one of the smallest countries in Europe. France is one of the largest and gets most of its electricity from nuclear. Germany is also big and is still burning fossil fuels including ( Ick ! ) coal. Yes, yes, Germany also uses wind and solar.

    Your last point ignores the historical facts and substitutes your supposed intellectual superiority for what actually occurred. Perhaps that's unfair. If so , let's say your claimed superior knowledge of economics .First , you ignore the example of Charlemagne and the Frankish Empire. Why not just say that you "don't know" or can't explain the inflation that occurred ? You also completely ignore the proven concept of Anticipatory Inflation. Around 1550 there was additional gold but NOT enough to cause the inflation that occurred. A cursory search would have told you that the inflation that resulted was from the sudden surge of SILVER. From both German mines and the Potosi mine in the Spanish colony of Peru. Silver coins were what most people used for ordinary day to day commerce. Its how soldiers were paid along with other public servants. Some estimates say that in less than five (5) years the amount of silver coins in circulation more than doubled.

    I already explained for you why the "Dog didn't bark " in 2009 and 2010. Please go back and reread what I said then. I stand by it now.

    A strong dollar does NOT increase domestic production costs. Quite the contrary, raw materials and other imports are CHEAPER with a strong dollar. Especially but not limited to imported oil. Now how exactly does a strong dollar raise production costs here in the Good Old USA ? Especially when
    the dollars paid to U.S. workers are worth more than with a weak dollar.

    Btw, the latest reports on employment were a mixed bag: The Unemployment rate dropped a couple tenths of a point ; new claims for unemployment were less than n the previous 3 weeks BUT new jobs created were only 194,000. Experts were expecting at least 500,000. We now have almost 11 MILLION open jobs.
    We have NEVER seen a number like that before. Many small businesses cannot get enough workers.
    Last edited by Eric Stoner; 10-08-2021 at 10:48 AM.
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    Teddy Roosevelt

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    Default Re: Interest rates in the coming months

    Quote Originally Posted by Eric Stoner View Post
    OK but you do agree that the money supply is an important factor.

    Thank you for the link. If true then ANWAR oil is not economically viable at this time.

    Cancelling the Keystone Pipeline, restricting drilling on public lands and other Biden policies are affecting domestic production. I pointed out Biden's granting of a waiver for Putin's new pipeline as an example of the incoherence of Biden's foreign policy and energy policy. Gasoline is selling for a dollar a gallon more than this time last year. Natural gas is at a 12 year high. Home heating oil is going up and up just in time for winter. The increases in food prices ALONE is costing the average American family an extra $2100 a year. The CPI does not include food, housing or energy costs. Inflation is running at a 30 year high.
    None of the above has anything at all to do with the increase in the price of gasoline. Oil companies aren't even drilling on all of the public land they have access to now. Not giving out any more drilling permits does nothing to increase the cost of gasoline. Food inflation is lower now than it was last year.



    The whole basis for your post is your deep dislike for Biden. You're just looking for reasons to bash him. The fact that you're bashing him for increases in food prices, when food prices were increasing faster last year, shows this.

    Quote Originally Posted by Eric Stoner View Post
    Our government is now giving out $20,000 grants for down payments on houses. Housing prices were already going way up without the extra subsidy.
    Biden's proposed tax increases will take more money out of American pockets. Higher corporate taxes result in higher prices and lower pay and lower dividends.
    Higher corporate taxes do not result in higher prices. Again, you're just looking for reasons to bash Biden's policies. Higher payroll taxes could potentially result in higher prices and lower pay, but higher taxes on corporate income will not. You don't seem to understand the laws of supply and demand, which is why we argue endlessly. Higher corporate income taxes do not increase corporate operating expenses. Businesses cannot sell products for a higher price than buyers are willing to pay for them. The goal of businesses is to maximize profits. Businesses sell their products at the highest price they can sell them for, regardless of taxes. Basically, you're saying that if a car manufacturer is selling one of their vehicles at $30,000 and paying 20% of their income in corporate tax, and the government were to raise taxes so that they're paying 25% of their income in taxes, they would raise the price of that vehicle to $31,000 or $32,000. If that auto manufacturer is able to sell that vehicle at $32,000 with a tax rate of 25%, why wouldn't they sell that vehicle for $32,000 with a 20% tax rate? Why would they not sell the product for the maximum price that people will pay for it, regardless of their tax rate?

    Quote Originally Posted by Eric Stoner View Post
    You must know more about the Texas power grid than I do. The news reports I watched and stories I read said that : 1. Texas gets a LOT of its electricity from wind power ; 2. The power consortium did not winterize its turbines and did not have adequate back up systems and 3. It took a while for Texas to get its system back online and to buy additional power from neighboring systems .
    Texas also gets a LOT of its electricity from natural gas, more than from wind.

    https://en.wikipedia.org/wiki/2021_T..._crisis#Causes

    The winter storm caused a record low temperature at Dallas-Fort Worth International Airport of −2 F (−19 C) on February 16, the coldest in North Texas in 72 years.[38] Power equipment in Texas was not winterized, leaving it vulnerable to extended periods of cold weather.[39][40] Texas Governor Greg Abbott and some other politicians initially blamed renewable energy sources for the power outages, citing frozen wind turbines as an example of their unreliability.[41] However, wind energy accounts for only 23% of Texas power output;[42] moreover, equipment for other energy sources such as natural gas power generating facilities either freezing up or having mechanical failures were also contributors.[41] Governor Abbott later acknowledged that every source of power, not just renewable ones, had failed.[41] When power was cut, it disabled some compressors that push gas through pipelines, knocking out further gas plants due to lack of supply.[43]
    Quote Originally Posted by Eric Stoner View Post
    Denmark is one of the smallest countries in Europe. France is one of the largest and gets most of its electricity from nuclear. Germany is also big and is still burning fossil fuels including ( Ick ! ) coal. Yes, yes, Germany also uses wind and solar.
    and they're getting more and more from renewables. Approximately 45% of the electricity generated in Germany comes from renewables.

    https://www.umweltbundesamt.de/en/to...ies-in-figures

    Quote Originally Posted by Eric Stoner View Post
    Your last point ignores the historical facts and substitutes your supposed intellectual superiority for what actually occurred. Perhaps that's unfair. If so , let's say your claimed superior knowledge of economics .First , you ignore the example of Charlemagne and the Frankish Empire. Why not just say that you "don't know" or can't explain the inflation that occurred ? You also completely ignore the proven concept of Anticipatory Inflation. Around 1550 there was additional gold but NOT enough to cause the inflation that occurred. A cursory search would have told you that the inflation that resulted was from the sudden surge of SILVER. From both German mines and the Potosi mine in the Spanish colony of Peru. Silver coins were what most people used for ordinary day to day commerce. Its how soldiers were paid along with other public servants. Some estimates say that in less than five (5) years the amount of silver coins in circulation more than doubled.
    The same thing I said about gold applies to silver. Again, you don't understand supply and demand. Again, the goal of businesses is to maximize their profits. You're saying that if an automaker is selling a vehicle for $30,000 and anticipates inflation of 5%, he's going to increase the price of the vehicle to $31,500, based on anticipated inflation. If that automaker is able to sell that vehicle for $31,500, why wouldn't he sell it for that price to begin with? Why would he sell a vehicle for $30,000 if he can sell it for $31,500, regardless of whether or not inflation is anticipated?

    Quote Originally Posted by Eric Stoner View Post
    I already explained for you why the "Dog didn't bark " in 2009 and 2010. Please go back and reread what I said then. I stand by it now.
    That doesn't change the fact that you believed you knew for certain that the Fed's policies would result in high inflation.

    Quote Originally Posted by Eric Stoner View Post
    A strong dollar does NOT increase domestic production costs. Quite the contrary, raw materials and other imports are CHEAPER with a strong dollar. Especially but not limited to imported oil. Now how exactly does a strong dollar raise production costs here in the Good Old USA ? Especially when
    the dollars paid to U.S. workers are worth more than with a weak dollar.
    It makes manufacturing more expensive in the US, compared to other countries. Let's say Japanese autoworkers get paid 4,000 yen per hour, American autoworkers get paid $30 an hour, and the exchange rate is 100 yen to one dollar. Based on this exchange rate, a Japanese automaker would be paying Japanese workers the equivalent of $40 an hour, and based on that figure, it would make economic sense to move their manufacturing to the US, because it is less costly. Now let's say the American dollar becomes stronger and the exchange rate increases to 200 yen for one dollar. Then the hourly wage in Japan falls to the equivalent of $20 an hour, and it becomes cheaper for the Japanese automaker to manufacture cars in Japan.

    Quote Originally Posted by Eric Stoner View Post
    Btw, the latest reports on employment were a mixed bag: The Unemployment rate dropped a couple tenths of a point ; new claims for unemployment were less than n the previous 3 weeks BUT new jobs created were only 194,000. Experts were expecting at least 500,000. We now have almost 11 MILLION open jobs.
    We have NEVER seen a number like that before. Many small businesses cannot get enough workers.
    It's because of the covid surge, and because businesses aren't willing to pay enough to attract workers. As I posted in another thread, a New York City restaurant is not having a problem finding workers at $25 an hour. Extended unemployment benefits ended in September, so you can blame that. The moratorium on evictions ended, so you can't blame that either.
    Last edited by eagle2; 10-09-2021 at 11:59 PM.

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    Default Re: Interest rates in the coming months

    Last year domestic oil production was over 13 million barrels per day. Today it is around 11 million barrels. How do you explain it ? Afaik roughnecks and refinery workers are not dropping like flies from Covid. We went from being a major gas exporter to Europe and have been replaced by the Russians.

    Under Biden our allies no longer trust us and our enemies no longer fear us. The CCP is busy pumping propaganda into Taiwan , Japan , South Korea and Australia saying : " Look what Biden did in Afghanistan. The Americans will not defend you."

    Please look at your chart. The one YOU posted ( apparently without reading it ). YOUR chart shows the RATE of INCREASE in food prices. For July and August of THIS year, 2021 they went up 3.4% and 3.7% respectively. Meat , milk , dairy , fish , eggs and processed foods of all kinds are all UP 20 to 25% over last year. Your chart only starts in October, 2020. What I posted is correct. the average American family of four is spending an average of $2100 per year more on food than a year ago. Part of the increase can be blamed on higher energy prices. Some is a result of the acute shortage of truck drivers. Energy costs are also a major component of housing costs. Rents are already going up and up.

    Corporations pay taxes on PROFITS. No profits = no corporate income taxes. In fact they write off their losses and decrease future tax liability. If profits are lower then corporations will try to pass the cost to the consumer. They will have less money to hire new workers and expand. Their purchases of new plant and equipment will go down. Dividends will be lower. That affects investors , IRA's , 401K's and pension plans.
    It is simplistic to say that all corporations care about is profits. Not in the short term. They also care about market share. And if their energy costs go up ( as they have been ) that affects prices and profits. Btw, real wages went up in the last Employment Report. That is not why so many small businesses cannot get enough workers. Inter alia , a lot of workers have been frightened by Biden , Fauci et. al. into not going back to work.

    With regard to Texas you are right. I'd forgotten about the impact of the extreme weather on the gas pipeline system. The pipelines need motors and blowers to keep the gas moving . However Texas did and does get 23% of its electricity from wind. The fact remains that they did not winterize their wind turbines. When they froze up ( as a few Cassandras predicted ) they had no back up.

    You are also correct about Germany and renewables. However they and other European countries have been forced to go back and burn coal to generate enough electricity. Germany's coal fired electric generation is 35% higher this year over last according to Bloomberg. According to the WSJ , the U.K. had to use gas and coal fired plants to make up the shortfall when North Sea winds stopped blowing. Prices for electricity have soared past 300 Euros per megawatt hour. 7 times higher than this time last year. Wind makes up 25% of U.K. power generation. Full capacity is 24 gigawatts. Wind production dropped to 1 gigawatt when the winds stopped blowing. According to the BBC and oilprice.com coal has been soaring in price. Yet it is still cheaper to burn than natural gas which is soaring even higher and faster.

    Honda , Toyota and BMW all manufacture cars here in the U.S.

    A strong dollar makes ALL imports cheaper. U.S. corporations locate their factories where ALL costs are cheapest. The cost of land to build a plant , warehouses or office space; taxes; regulations ; energy costs ; labor costs ; raw materials; shipping costs etc.

    Japanese companies have grown up and developed in a totally different system than ours. Inter alia they are a homogenous population with respect for authority. Feudal lords were replaced by corporations. While they have a profit motive they see their primary duty as one of preserving jobs for their workers. Their companies are run differently and are far more paternalistic. Their workers have a reciprocal loyalty. One of several factors you left out of your hypos.

    In the REAL world , as a historical fact, we saw a LOT of anticipatory inflation in the 1970's. Suppliers expected their costs to go up so they increased their prices based on estimated FUTURE costs. Unions expected prices to keep going up and made wage demands based thereon. Lenders expected rates to keep going up so they raised their rates expecting to have to pay depositors more and pay higher interest on their interbank borrowing and loans from the FED. In 1550's Spain people behaved the same way.

    Btw, New York and New Jersey have both continued the moratorium on evictions until January 15 , 2022.

    I am relying on the historical record in saying that doubling the amount of silver in circulation resulted in high inflation. During a similar experience Charlemagne imposed price controls on grain and other foods. You tell us : Why did he have to do that ?

    MY uncle was on occupational duty in post war West Germany. He often told us how strict price controls were put on food and the store shelves were empty. The day after they were lifted ( with no prior announcement ) the stores started filling up. Why do you think that was ? I lived through Nixon's attempts to micromanage the economy. When he lifted wage and price controls both shot up. Supplies did not increase. Instead we ended up with a meat shortage and a paper shortage of all things.
    Last edited by Eric Stoner; 10-12-2021 at 08:45 AM.
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    Default Re: Interest rates in the coming months

    Quote Originally Posted by Eric Stoner View Post
    Last year domestic oil production was over 13 million barrels per day. Today it is around 11 million barrels. How do you explain it ? Afaik roughnecks and refinery workers are not dropping like flies from Covid. We went from being a major gas exporter to Europe and have been replaced by the Russians.
    No it wasn't. Oil production is higher this year. May and July 2021 had the highest monthly domestic oil production since April 2020.

    https://www.eia.gov/dnav/pet/hist/Le...s=MCRFPUS1&f=M

    Hurricane Ida caused a decline in oil production in August and September.

    Quote Originally Posted by Eric Stoner View Post
    Under Biden our allies no longer trust us and our enemies no longer fear us. The CCP is busy pumping propaganda into Taiwan , Japan , South Korea and Australia saying : " Look what Biden did in Afghanistan. The Americans will not defend you."
    Trump is the one who signed the withdrawal agreement with the Taliban, not Biden. Trump is the one who released thousands of Taliban fighters from prison, not Biden. I assure you, all of our allies are very happy to have Biden in office, rather than Trump, who loved dictators and showed disdain for democracies, including our own. Please stop trying to turn this into political discussion. Events in Afghanistan have nothing to do with the subject.

    Quote Originally Posted by Eric Stoner View Post
    Please look at your chart. The one YOU posted ( apparently without reading it ). YOUR chart shows the RATE of INCREASE in food prices. For July and August of THIS year, 2021 they went up 3.4% and 3.7% respectively. Meat , milk , dairy , fish , eggs and processed foods of all kinds are all UP 20 to 25% over last year. Your chart only starts in October, 2020. What I posted is correct. the average American family of four is spending an average of $2100 per year more on food than a year ago. Part of th increase can be blamed on higher energy prices. Some is a result of the acute shortage of truck drivers. Energy costs are also a major component of housing costs. Rents are already going up and up.
    In October and December of LAST year, food prices increased 3.9%, which is greater than 3.4% and 3.7%.

    Quote Originally Posted by Eric Stoner View Post
    Corporations pay taxes on PROFITS. No profits = no corporate income taxes. In fact they write off their losses and decrease future tax liability. If profits are lower then corporations will try to pass the cost to the consumer. They will have less money to hire new workers and expand. Their purchases of new plant and equipment will go down. Dividends will be lower. That affects investors , IRA's , 401K's and pension plans.
    It is simplistic to say that all corporations care about is profits. Not in the short term. They also care about market share. And if their energy costs go up ( as they have been ) that affects prices and profits. Btw, real wages went up in the last Employment Report. That is not why so many small businesses cannot get enough workers. Inter alia , a lot of workers have been frightened by Biden , Fauci et. al. into not going back to work.
    In general, corporations want to make the maximum profit on each of the items or services they sell. For example, if GM is planning on producing and selling 7 million vehicles over the next year, their goal is to sell each of those vehicles at the highest price buyers are willing to pay for them. It doesn't matter if there is anticipated inflation or if there was a tax increase. GM is going to price their vehicles at the highest possible price they can get buyers to pay for them. The same goes for auto dealers. When you go to a dealer to buy a car or truck, the dealer is going to try to get you to pay as much as possible for the vehicle you're looking to buy. Corporate tax increases and any anticipated inflation don't play any role in how much they sell you the vehicle for. They want to sell it to you at the highest price you're willing to pay for it.

    Regardless of whether or not energy costs have gone up for corporations, their profits are way up this year.

    https://insight.factset.com/sp-500-e...-august-6-2021

    At this point in time, more S&P 500 companies are beating EPS estimates for the second quarter than average, and beating EPS estimates by a wider margin than average. As a result, the index is reporting higher earnings for the second quarter today relative to the end of last week and relative to the end of the quarter. The index is currently reporting the highest year-over-year growth in earnings since Q4 2009.
    Please stop with your bashing of President Biden and Dr. Fauci. Over 700,000 Americans have died over the past 1 1/2 years. People have good reason to be scared to work in certain industries. It's not just fear of the virus driving people out of certain field. Many nurses and other hospital staff are tired of being overworked and overwhelmed because of stupid, stubborn people who refuse to wear masks or get vaccinated. Teachers and school boards are tired of dealing with belligerent, loud-mouthed nutjobs hollering about CRT or mask mandates. They're also tired of nutjob governors fighting efforts to keep their schools and workplaces safe.

    Quote Originally Posted by Eric Stoner View Post
    Honda , Toyota and BMW all manufacture cars here in the U.S.
    So do Nissan and Hyundai. A major factor in their decision to build in the US is how strong the dollar is compared to other currencies. When the dollar is weak, it is less costly for them to manufacture in the US, compared to other countries. When the dollar is strong, it makes it more costly to manufacture in the US compared to other countries.

    Quote Originally Posted by Eric Stoner View Post
    A strong dollar makes ALL imports cheaper. U.S. corporations locate their factories where ALL costs are cheapest. The cost of land to build a plant , warehouses or office space; taxes; regulations ; energy costs ; labor costs ; raw materials; shipping costs etc.
    Yes, and when imports are cheaper, financially it makes sense to manufacture those products in other countries, because they can either sell their products at a cheaper price in the US, or sell them at the same price and make more profit. Again, it cost one half as much in US dollars to pay a Japanese auto worker's wages, if the exchange rate is 100 yen to one dollar as opposed to 200 yen to a dollar. At times when the dollar is weak compared to the yen, Honda will even manufacture more autos in the US and export them to Japan, which means more work for Americans.

    Quote Originally Posted by Eric Stoner View Post
    Japanese companies have grown up and developed in a totally different system than ours. Inter alia they are a homogenous population with respect for authority. Feudal lords were replaced by corporations. While they have a profit motive they see their primary duty as one of preserving jobs for their workers. Their companies are run differently and are far more paternalistic. Their workers have a reciprocal loyalty. One of several factors you left out of your hypos.
    They're still willing to move some of their manufacturing to the US, if it benefits them financially.

    Quote Originally Posted by Eric Stoner View Post
    In the REAL world , as a historical fact, we saw a LOT of anticipatory inflation in the 1970's. Suppliers expected their costs to go up so they increased their prices based on estimated FUTURE costs. Unions expected prices to keep going up and made wage demands based thereon. Lenders expected rates to keep going up so they raised their rates expecting to have to pay depositors more and pay higher interest on their interbank borrowing and loans from the FED. In 1550's Spain people behaved the same way.
    Some union workers have their wages tied to inflation, so wages automatically increase when inflation increases, which pushes up production costs, and ultimately, the price of the product, but in the end, sellers can't sell their products for more than what people are willing to pay. OPEC tried this in the 1970s, and in the short term, made massive amounts of money, but over the long-term, demand for oil declined significantly, and other oil producers were willing to spend a lot more money searching and drilling for oil. Some OPEC nations are having financial difficulties now. People who are dependent on gasoline for transportation can't decrease how much they use overnight, but long-term, many people traded in their big gas-guzzling cars for smaller, more fuel-efficient vehicles.

    Quote Originally Posted by Eric Stoner View Post
    Btw, New York and New Jersey have both continued the moratorium on evictions until January 15 , 2022.

    I am relying on the historical record in saying that doubling the amount of silver in circulation resulted in high inflation. During a similar experience Charlemagne imposed price controls on grain and other foods. You tell us : Why did he have to do that ?
    Increasing the amount of money or silver in circulation will result in high inflation, if and only if that currency is being spent. That's the part you leave out. There was high inflation under Charlemagne because people were spending a lot more money or silver, which drove up prices. In 2010 there was a dramatic increase in the supply of money, but consumers and businesses weren't spending it, so inflation stayed close to zero. Corporations had over $1 trillion in cash on hand, but because they didn't spend or invest in capital, there was no inflation.

    Quote Originally Posted by Eric Stoner View Post
    MY uncle was on occupational duty in post war West Germany. He often told us how strict price controls were put on food and the store shelves were empty. The day after they were lifted ( with no prior announcement ) the stores started filling up. Why do you think that was ? I lived through Nixon's attempts to micromanage the economy. When he lifted wage and price controls both shot up. Supplies did not increase. Instead we ended up with a meat shortage and a paper shortage of all things.
    In most cases, prices controls don't work. Perhaps in extreme cases, like World War 2, they may be necessary, but in most cases, it's better to let the market decide the prices.

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    Default Re: Interest rates in the coming months

    Sigh. It would be so very helpful if you would READ your links BEFORE you post them. From the source you cited, eia.gov , domestic oil production in January through March 2020 hit a high of 13 million barrels per day. It dropped to a low of 9.7 barrels in August 2020 . Since then it has ranged between 10.7 and 11.5 barrels per day.

    Let me see if I have this right. YOU get to bash "You Know Who" and blame him for everything including a lot of stuff that happened AFTER he left office. But if I say anything it is "political ". Got it. Too soon ?
    More people have died from Covid under "You Know Who Who " ( hereinafter "Who 2" ) than under his predecessor. The Afghanistan debacle is all on Who 2 . In a previous post YOU acknowledged that our withdrawl was a fiasco His generals unanimously said he lied (they didn't use that word ) when he said that nobody told him about abandoning Bagram or that we should leave 2500 troops on the ground. Blinken said he had no idea the Taliban would advance so fast; had no plan to evacuate Americans and our allies ; left behind at least 100 Americans and thousands of Green Card holders . Great Britain censured Who 2 and France recalled their ambassador. The Saudis are seriously considering getting their own nukes to counter Iran. Several other countries are giving it very serious thought. They USED to rely on the U.S. nuclear umbrella.

    I could go on and on and on.

    Taking your advice and circling back to the main topic, Treasury Secretary Yellen promised to be a "voice for fiscal sanity " and now says that inflation and INTEREST RATES will not rise. Not even with $3 to $5 trillion of new spending. Uh huh.

    Secretary of Agriculture Vilsack is pushing a Capital Gains tax that would make it very difficult for children to inherit the family farm or ranch.

    Secretary of Labor Walsh said he doesn't know why people are not going back to work and doesn't know what to do about it. I am NOT making this up. He was asked over the weekend about the latest Jobs Report and that's what he said.

    Secretary pf Transportation Buttigieg proposed a mileage tax and then retracted it when Biden was told it would hit the poor the hardest. When asked about our current supply problems he said we need more "apprenticeship programs". !! ?? !! ?? I am NOT making this up. I can't . I was never that good at comical farce. He came into office as the former Mayor Of South Bend , Indiana. Not known for major traffic or other transportation issues. Like many of Who 2's appointees he's learning on the job and/or just making it up as he goes along. Btw, when he was told what Pete had said about the supply backlogs the Director of Florida's Ports and Terminals was stunned speechless . He then said that Buttigieg obviously had no idea what the problems were or what to do about them. Now it is not just L.A. and Long Beach that are clogged up. Port Newark is backed up. I see the effects every weekday morning with ships anchored all over New York Harbor waiting to dock and unload. Baltimore and Savannah are also backed up. Miami, Port Everglades and other Florida ports SAY they are not backed up and are a good alternative to L.A. and Long Beach but my spies who live down there say there is a backlog albeit more on shore than on the piers themselves..

    Secretary of Energy Granholm is too busy telling oil and gas executives that their industry is dying to do anything about oil and gas supplies. Those executives have had to sit and listen to that tune since the 1970's while their industry is making record profits. Btw, she has ZERO experience in the energy field. She's a former Governor of Michigan. It's going to be a long winter. And its predicted to be colder than usual. I suggest we all stock up on blankies and thermal socks for INDOOR use. Why didn't he appoint Gavin Newsom ? At least he has experience with rolling blackouts and high electric bills. Plus the highest gasoline prices in the country. That way he could also consult with the Interior Department in his spare time on forest management and water policy. I guess he had a job already and Granholm was out of work so at least he lowered the unemployment rate among unqualified liberal Dems.

    Members of school boards won't have to worry about "belligerent, loud-mouthed nut jobs " any more. Attorney General Garland is siccing the FBI on any parent who exercises their First Amendment rights and addresses a school board in any way that seems "threatening ". At least he's laid out an unambiguous and objective standard . NOT !

    Do you buy groceries ? Are you spending more or less than you spent last year ? What about gasoline ? Have prices gone up at least a dollar per gallon over last year ? Do you heat with gas or oil ? How are prices this year compared to last ? How's your electric bill ?

    As to the balance of your post we seem to agree more than disagree. Aside from a quibble here or there.

    Btw, inflation last year ran at 1.9%. The latest report has it at 5.4%. And the hits just keep on coming.

    Oh and Biden has finally recognized the supply chain breakdown and is forming a study group. They should have a proposal or two in time for Easter.

    Breaking News ! Ports will now operate 24/7. Duh. Who thought that up ? Where have they been ? That addresses only HALF the problem. We are still way short of the truck drivers needed to get the cargo from the ports to the plants and factories for assembly and manufacture. And to the wholesalers and the retailers. One suggestion is to deregulate the trucking biz. I for one am leery of letting truck drivers drove more than 12 hours per day. The Federal DOT regulation actually puts the limit at 11 hours per day. Fatigued drivers cause accidents and truck accidents are usually ten times worse than car accidents. Trucking companies are offering sign up bonuses for new drivers and still can't get enough people. Federal scholarships for truck driver training ? Use military and National Guard truck drivers ?
    Last edited by Eric Stoner; 10-13-2021 at 08:56 AM.
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    Teddy Roosevelt

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    Default Re: Interest rates in the coming months

    Quote Originally Posted by Eric Stoner View Post
    Sigh. It would be so very helpful if you would READ your links BEFORE you post them. From the source you cited, eia.gov , domestic oil production in January through March 2020 hit a high of 13 million barrels per day. It dropped to a low of 9.7 barrels in August 2020 . Since then it has ranged between 10.7 and 11.5 barrels per day.
    Sigh. Biden didn't take office until January 2021.

    Quote Originally Posted by Eric Stoner View Post
    Let me see if I have this right. YOU get to bash "You Know Who" and blame him for everything including a lot of stuff that happened AFTER he left office. But if I say anything it is "political ". Got it. Too soon ?
    More people have died from Covid under "You Know Who Who " ( hereinafter "Who 2" ) than under his predecessor. The Afghanistan debacle is all on Who 2 . In a previous post YOU acknowledged that our withdrawl was a fiasco His generals unanimously said he lied (they didn't use that word ) when he said that nobody told him about abandoning Bagram or that we should leave 2500 troops on the ground. Blinken said he had no idea the Taliban would advance so fast; had no plan to evacuate Americans and our allies ; left behind at least 100 Americans and thousands of Green Card holders . Great Britain censured Who 2 and France recalled their ambassador. The Saudis are seriously considering getting their own nukes to counter Iran. Several other countries are giving it very serious thought. They USED to rely on the U.S. nuclear umbrella.

    I could go on and on and on.
    You're the one who brought up the US withdrawal from Afghanistan, which has nothing to do with the topic, not me. You do this all the time. You turn every discussion into bashing President Biden and Dr. Fauci, and praising Trump. You did this in the Covid discussion, which was shut down because of it. It is a fact that Trump agreed to release thousands of Taliban fighters, against the advice of his security advisors. It is a fact that Trump is the one who signed the withdrawal treaty with the Taliban that President Biden had to abide by. Trump even bragged about it in one of his unhinged rants.

    https://twitter.com/theNuzzy/status/1427051039404957697

    When Obama/Biden left office, Iran was no longer enriching uranium. They only started it up again when Trump withdrew from the agreement we made with them.

    No, more people did not die from covid under Biden than under Trump. You're repeating misinformation from the Washington Times, that did not include the deaths that occurred from October thru Jan. 20 under Trump. Even if it were true, it doesn't change the fact that Biden is doing everything he can to prevent the virus from spreading and infecting and killing more people. Trump fought every effort to prevent it from spreading and attacked governors who did. President Biden isn't responsible for the people who refuse to get vaccinated based on internet memes, rather than following the advice of their doctor.

    I don't know what it is with you, that you refuse to see Trump for what he is. You regularly defend him and gaslight for him. You deny his racism, his incompetence, and his stupidity. You deny he suggested injecting disinfectant to cure covid, even after being shown a video of him saying it. You try to normalize him by telling people who condemn all of the horrific things he says and does that they have "Trump derangement syndrome."

    Quote Originally Posted by Eric Stoner View Post
    Taking your advice and circling back to the main topic, Treasury Secretary Yellen promised to be a "voice for fiscal sanity " and now says that inflation and INTEREST RATES will not rise. Not even with $3 to $5 trillion of new spending. Uh huh.
    We need massive spending on our infrastructure. You said inflation and interest rates will rise, the last time the government passed massive spending increases, and it didn't.

    Quote Originally Posted by Eric Stoner View Post
    Secretary of Agriculture Vilsack is pushing a Capital Gains tax that would make it very difficult for children to inherit the family farm or ranch.

    Secretary of Labor Walsh said he doesn't know why people are not going back to work and doesn't know what to do about it. I am NOT making this up. He was asked over the weekend about the latest Jobs Report and that's what he said.

    Secretary pf Transportation Buttigieg proposed a mileage tax and then retracted it when Biden was told it would hit the poor the hardest. When asked about our current supply problems he said we need more "apprenticeship programs". !! ?? !! ?? I am NOT making this up. I can't . I was never that good at comical farce. He came into office as the former Mayor Of South Bend , Indiana. Not known for major traffic or other transportation issues. Like many of Who 2's appointees he's learning on the job and/or just making it up as he goes along. Btw, when he was told what Pete had said about the supply backlogs the Director of Florida's Ports and Terminals was stunned speechless . He then said that Buttigieg obviously had no idea what the problems were or what to do about them. Now it is not just L.A. and Long Beach that are clogged up. Port Newark is backed up. I see the effects every weekday morning with ships anchored all over New York Harbor waiting to dock and unload. Baltimore and Savannah are also backed up. Miami, Port Everglades and other Florida ports SAY they are not backed up and are a good alternative to L.A. and Long Beach but my spies who live down there say there is a backlog albeit more on shore than on the piers themselves..

    Secretary of Energy Granholm is too busy telling oil and gas executives that their industry is dying to do anything about oil and gas supplies. Those executives have had to sit and listen to that tune since the 1970's while their industry is making record profits. Btw, she has ZERO experience in the energy field. She's a former Governor of Michigan. It's going to be a long winter. And its predicted to be colder than usual. I suggest we all stock up on blankies and thermal socks for INDOOR use. Why didn't he appoint Gavin Newsom ? At least he has experience with rolling blackouts and high electric bills. Plus the highest gasoline prices in the country. That way he could also consult with the Interior Department in his spare time on forest management and water policy. I guess he had a job already and Granholm was out of work so at least he lowered the unemployment rate among unqualified liberal Dems.
    None of this has anything to do with the thread topic. Again, you're trying to turn this into a political discussion, and bashing the Biden Administration.

    Quote Originally Posted by Eric Stoner View Post
    Members of school boards won't have to worry about "belligerent, loud-mouthed nut jobs " any more. Attorney General Garland is siccing the FBI on any parent who exercises their First Amendment rights and addresses a school board in any way that seems "threatening ". At least he's laid out an unambiguous and objective standard . NOT !
    Death threats are not covered by the First Amendment. That's what these nutjobs do. Dr. Fauci had to hire bodyguards for his family because of all of the death threats they were getting. Election workers were quitting their jobs because of all of the death threats they were getting for doing their jobs properly. A Texas man has been charged after allegedly threatening to gun down a Maryland doctor who urged the public to take the coronavirus vaccine.

    https://www.thedailybeast.com/scott-...avirus-vaccine

    Quote Originally Posted by Eric Stoner View Post
    Do you buy groceries ? Are you spending more or less than you spent last year ? What about gasoline ? Have prices gone up at least a dollar per gallon over last year ? Do you heat with gas or oil ? How are prices this year compared to last ? How's your electric bill ?

    As to the balance of your post we seem to agree more than disagree. Aside from a quibble here or there.

    Btw, inflation last year ran at 1.9%. The latest report has it at 5.4%. And the hits just keep on coming.

    Oh and Biden has finally recognized the supply chain breakdown and is forming a study group. They should have a proposal or two in time for Easter.

    Breaking News ! Ports will now operate 24/7. Duh. Who thought that up ? Where have they been ? That addresses only HALF the problem. We are still way short of the truck drivers needed to get the cargo from the ports to the plants and factories for assembly and manufacture. And to the wholesalers and the retailers. One suggestion is to deregulate the trucking biz. I for one am leery of letting truck drivers drove more than 12 hours per day. The Federal DOT regulation actually puts the limit at 11 hours per day. Fatigued drivers cause accidents and truck accidents are usually ten times worse than car accidents. Trucking companies are offering sign up bonuses for new drivers and still can't get enough people. Federal scholarships for truck driver training ? Use military and National Guard truck drivers ?
    My groceries have not gone up in price. Neither has my electric bill. Gasoline has, but that was expected, based on the increase in demand. Even if Biden's policies did cause a modest increase in gasoline, I'd rather pay the extra amount and protect the environment, our air quality, and water supplies.

    Since this thread has gone way off topic and has gone over the line with politics, this is going to be my last post.

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