American Economics Thread

[Deleted member 15949]

Those days are numbered, especially now that it is China, not the anglo US, which is the world's largest trading nation in the world.

China isn't going to be running an open capital account or a CA deficit in a long time

 

[Deleted member 15949]

Continued “money printing” to fund deficit spending can end badly. But the US have been able to get away with this for far longer than possible in any other country.

As long as the Dollar remains the global reserve currency, the US can prob “fund” itself for a long time.

so basically for decades and decades with free money printing and endless growth

 

[Deleted member 15949]

Sure, I give up trying to convince a brick wall that a brick wall can only ever be brick wall. The US economic can only ever succeed if they can actually produce things on a scale of what China can do without the massive debt piling on daily, both of which is impossible right now.

No,

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.

But still assuming you are living in the USA right now, how about we wait for a few more months to see if the nation doesn't end up going down the path of 'the forever purge'. Modern monetary theory is not going to work for very long and the sooner you understand the why, the better you will be, but then again, you obviously haven't been hit hard enough by the 2008 economic crisis to understand why there are so many homeless people in California right now.

LOL, the inflationistas have been wrong for 50 years but this time will surely be it. There are homeless people in CA because California has insane housing prices and productivity (that increases CoL).

 

[zgx09t]

money printing has no bad consequences and the faster you can accept those truths, the better.

Your thinking of Fed's balance sheet as your open cheque book and Treasury giving back to USG any interest it earned on USG portion of fiscal deficit is fine and dandy as long as they won't show up in the balance sheets of entire financial system, which is next to impossible in real life. Sooner or later, all these excess liquidity with low interest rates, or worse, higher ones, will either screw Uncle Same dearly or US financial system, or both. What tools will be left in the tools box then?

 

[Deleted member 15949]

Your thinking of Fed's balance sheet as your open cheque book and Treasury giving back to USG any interest it earned on USG portion of fiscal deficit is fine and dandy as long as they won't show up in the balance sheets of entire financial system, which is next to impossible in real life.

The last 10 years of Fed policy are real life.

Sooner or later, all these excess liquidity with low interest rates, or worse, higher ones, will either screw Uncle Same dearly or US financial system, or both. What tools will be left in the tools box then?

Low interest rates are here to stay because of demographics and Fed brrr. What tools? More fiscal and monetary expansion. It's a runaway gravy train with no downside. Name a single actual downside that has materialized

 

[KYli]

The last 10 years of Fed policy are real life.

Low interest rates are here to stay because of demographics and Fed brrr. What tools? More fiscal and monetary expansion. It's a runaway gravy train with no downside. Name a single actual downside that has materialized

Inflation, real estate bubble, household debt bubble, government debt bubble, stock market bubble.

 

[zgx09t]

The last 10 years of Fed policy are real life.

Low interest rates are here to stay because of demographics and Fed brrr. What tools? More fiscal and monetary expansion. It's a runaway gravy train with no downside. Name a single actual downside that has materialized

Fed alone is not the only game in town, that's the gist of Fed policy in past 10 years in real life. They tried to lift as much as they could, and got out as soon as they could. Lower zero bound rates are here only in recent years as the economy was shut down significantly, to act like a cushion so to speak.
Balance sheet inflation is as bad as, if not worse than, balance sheet deflation/recession. But I'll give you a point on lag time, as most of the times they come and go in a cycle, not immediately.

 

[FairAndUnbiased]

Inflation, real estate bubble, household debt bubble, government debt bubble, stock market bubble.

Housing and student debt bubbles have created a permanent underclass of US millennials who control only 5% of all US wealth despite being 22% of US population. In comparison when boomers were at millennials age they had 21% of US wealth.

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[Deleted member 15949]

Inflation, real estate bubble, household debt bubble, government debt bubble, stock market bubble.

CPI at 2% and real estate prices/household debt/government debt and the stock market that have grown at rates consistent with their historical rates

 

[Deleted member 15949]

Housing and student debt bubbles have created a permanent underclass of US millennials who control only 5% of all US wealth despite being 22% of US population. In comparison when boomers were at millennials age they had 21% of US wealth.

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Boomers made up a larger % of the US population. Learn what tail-skew distributions and the difference between stocks and flows