Where is the inflation?

[Bombur]

Daily Treasury Yield Curve Rates

The prices for Treasuries have all been significantly increased by the Fed's intervention.

We are in a bubble, kids. Just like the housing bubble. Only bigger. Much bigger.

How are price changes going to result in widespread liquidity problems like the housing bubble did?

 

[Bombur]

Inflation's hidden under taxes. When I started smoking they were $1.35/pack. When I quit over $7/pack.

That isn't inflation, that is higher taxes.

HTH

 

[Bombur]

Check the grocery store you can find it there.

Nope. That's anecdotal.

I provided a link earlier showing the prices for various foods and energy over time.

People make shit up about how much food has gone up. In short, they lie.

In short they don't you can argue over why food prices have gone up but they have gone up.

When inflation is measured food is often broken out and calculated and considered separately because of the large amount of fluctuations that can take place.

Certain markets can see inflation or even deflation while overall inflation can be low. We are in a period where overall inflation is low. This doesn't mean an individual isn't experiencing inflation in what they spend their money on.

 

[blackhawk]

Check the grocery store you can find it there.

Nope. That's anecdotal.

I provided a link earlier showing the prices for various foods and energy over time.

People make shit up about how much food has gone up. In short, they lie.

In short they don't you can argue over why food prices have gone up but they have gone up.

Your sentence is not a sentence, but as to food prices .... the price rise was forecast BEFORE the fed's actions.

http://www.economist.com/node/10252015

I was not referring to the Feds actions I was talking about the claim people make shit up over how much food has gone up.

 

[danielpalos]

Still too much slack in the economy, we're still not growing fast enough to worry about inflation.

The 10-year Treasury is back up to 2.40%, but it's not very stable.

The trick will be whether the Fed can effectively suck the massive liquidity back out of the system. Too fast and we stall again. Too slowly and we get rapid inflation.

Any bets?

.

I'm guessing that things will either get better or they will get worse.

I'm also predicting that tomorrow will either be hotter or colder.

I think you've nailed it.

JP Morgan (himself) was once asked by a reporter what he expected the market to do. He paused for a moment and said:

"I believe it's going to fluctuate".



.

Wasn't it the Capital faction that told Hoover not to worry about the stock market, just before it collapsed 1929?

The Right only likes to blame the Statist Fed for the Great Depression.

 

[Contumacious]

Inflation is ''General" increase. The Fed may create a balloon market. I'm sorry if economic definitions are not to your liking.

Mankiw't text is more "pithy." Inflation - "an increase in the overall level of prices in an economy."

LISTEN FUCKTARD,


I APPRECIATE "ECONOMIC" DEFINITIONS.

I DO NOT LIKE IT WHEN THE GOVERNMENT INTERFERES IN THE ECONOMY AND YOU WANT THE ACT CLASSIFIED AS AN ECONOMIC DECISION.


ECONOMICS WAS TRADITIONALLY DEFINED AN THE STUDY HOW INDIVIDUALS AND MARKET INTERACT


GANGSTA (FASCIST/SOCIALIST) ECONOMICS , WHICH YOU APPEAR TO ENDORSE, IS THE STUDY OF HOW GOVERNMENTS ****FORCE**** INDIVIDUALS AND MARKET TO INTERACT.


Capisce?


Go forth and sin no more.

 

[SwimExpert]

Actually, we've had the same net effect as inflation because wages have been declining...

Caused by two things:

1 - High unemployment
2 - Job seekers being entitled nitwits and expecting companies to simply fork over top dollar despite the fact that the job seeker is willing to settle for bottom dollar.

 

[SwimExpert]

Interests rates have been near 0 for close to 5 years as the Fed has been pumping trillions of dollars into the economy each year. Why hasn't this caused inflation? Where is the inflation? When can I expect inflation?
Are you sure that American economics will stay stable?
Is dollar reliable value??

The reason we do not have runaway inflation is because the velocity of money plunged after the crash.

You can print a trillion dollars, but if you bury it in the back yard, it won't cause inflation. That's basically what has happened. A lot of that cash is not moving around. Some of it has pushed the Dow up, but quite a bit is buried in the back yard.

Oh, didn't you know? The idiot Cinos have formulated a bad understanding of what is already a poor theory, which we know as messageboard style supply side economics. The more money you bury in the back yard, the more the economy will grow! They think money grows on trees!

 

[Toro]

The inflation is in asset prices, not consumer prices.

 

[bendog]

That is not inflation, as the term is defined in economics. But, the QE moves may well have created a bubble market equities, although most seem to say that prices are not remarkably high give profits. But, then again, we seem to excel in creating paper profits on Wall St without actually making anything.

But, the bottom line is where can investors park money and expect any return but equities. And that goes back to G5000s comments about Greece. Investors want an 11% return, and there's really no logical reason to expect that. The old "double your money every seven years" meme from the 90s was bs.

 

[g5000]

Daily Treasury Yield Curve Rates

The prices for Treasuries have all been significantly increased by the Fed's intervention.

We are in a bubble, kids. Just like the housing bubble. Only bigger. Much bigger.

How are price changes going to result in widespread liquidity problems like the housing bubble did?

When the velocity of money begins to pick up, then all that money the Fed has printed since 2008 will begin causing inflation. At that time, the Fed will need to start soaking up cash to fight inflation. They will do this by selling their assets.

Except their assets will be underwater, which means they will not be able to take out as much as they put in. And that means they will not be able to tame inflation.

 

[Bombur]

Daily Treasury Yield Curve Rates

The prices for Treasuries have all been significantly increased by the Fed's intervention.

We are in a bubble, kids. Just like the housing bubble. Only bigger. Much bigger.

How are price changes going to result in widespread liquidity problems like the housing bubble did?

When the velocity of money begins to pick up, then all that money the Fed has printed since 2008 will begin causing inflation. At that time, the Fed will need to start soaking up cash to fight inflation. They will do this by selling their assets.

Except their assets will be underwater, which means they will not be able to take out as much as they put in. And that means they will not be able to tame inflation.

The Federal Reserve doesn't have liquidity problems. Your belief that the Federal Reserve will not be able to reduce the money supply enough is unfounded as the basis of your argument already presumes a reduction in velocity and therefor effective supply. It is like you are trying to solve an inflation problem under a scenario where there isn't one.

 

[bendog]

Daily Treasury Yield Curve Rates

The prices for Treasuries have all been significantly increased by the Fed's intervention.

We are in a bubble, kids. Just like the housing bubble. Only bigger. Much bigger.

How are price changes going to result in widespread liquidity problems like the housing bubble did?

When the velocity of money begins to pick up, then all that money the Fed has printed since 2008 will begin causing inflation. At that time, the Fed will need to start soaking up cash to fight inflation. They will do this by selling their assets.

Except their assets will be underwater, which means they will not be able to take out as much as they put in. And that means they will not be able to tame inflation.

I do not understand why the Fed has not begun "small" sales already. The rise in rates that will have to occur sometime in the Fall or at least before Christmas will affect equity prices, as would bond sales, but why not start the sales sooner rather than later, as that would not spur inflation now? [edit, nor do I see why the Fed must hold the mortgage backed securities it bought to buck up the market. The market is not going to collapse overnight if the Fed sold orr a portion sooner rather than later.]

And, because any "profit" the Fed makes must be transferred to the Treasury, doesn't that really artificially reduce the deficit? If so, it just heightens the need to address entitlements. I realize the gop is politically unable to do that, though, because Obama will not move without some revenue increase to offset cuts.

 

[Contumacious]

That is not inflation, as the term is defined in economics. But, the QE moves may well have created a bubble market equities, although most seem to say that prices are not remarkably high give profits. But, then again, we seem to excel in creating paper profits on Wall St without actually making anything.

But, the bottom line is where can investors park money and expect any return but equities. And that goes back to G5000s comments about Greece. Investors want an 11% return, and there's really no logical reason to expect that. The old "double your money every seven years" meme from the 90s was bs.

Bullshit, of course you meant to say that it is not inflation as the term is defined by the fascists/socialist axis:

"To be sure, it doesn't require a central bank for a state to choose inflation over taxes as a means of funding itself. All it really requires is a monopoly on the production of money. Once acquired, the monopoly on money production leads to a systematic process of depreciating the currency, whether by coin clipping or debasement or the introduction of paper money, which can then be printed without limit. The central bank assists in this process in a critical sense: it cartelizes the banking system, the essential conduit by which money is lent to the public and to the government itself. The banking system thereby becomes a primary funding agency to the state, and, in exchange for its services, the banking system is guaranteed against insolvency and business failure as it profits from inflation. If the goal of the state is the complete monopolization of money under an infinitely flexible paper-money system, there is no better path for the state than the creation of a central bank. This is the greatest achievement for the victory of power over liberty."

 

[bendog]

That is not inflation, as the term is defined in economics. But, the QE moves may well have created a bubble market equities, although most seem to say that prices are not remarkably high give profits. But, then again, we seem to excel in creating paper profits on Wall St without actually making anything.

But, the bottom line is where can investors park money and expect any return but equities. And that goes back to G5000s comments about Greece. Investors want an 11% return, and there's really no logical reason to expect that. The old "double your money every seven years" meme from the 90s was bs.

Bullshit, of course you meant to say that is not inflation as the term is defined by the fascists/socialist axis:

"To be sure, it doesn't require a central bank for a state to choose inflation over taxes as a means of funding itself. All it really requires is a monopoly on the production of money. Once acquired, the monopoly on money production leads to a systematic process of depreciating the currency, whether by coin clipping or debasement or the introduction of paper money, which can then be printed without limit. The central bank assists in this process in a critical sense: it cartelizes the banking system, the essential conduit by which money is lent to the public and to the government itself. The banking system thereby becomes a primary funding agency to the state, and, in exchange for its services, the banking system is guaranteed against insolvency and business failure as it profits from inflation. If the goal of the state is the complete monopolization of money under an infinitely flexible paper-money system, there is no better path for the state than the creation of a central bank. This is the greatest achievement for the victory of power over liberty."

WTF are you ranting about now? Roflmao

 

[g5000]

The Federal Reserve doesn't have liquidity problems.

Yet. The banks didn't have liquidity problems in 2006, either. When you are in the bubble, you don't have liquidity problems.

Once the asset bubble pops, then the Fed will have liquidity problems. Just like the banks did in 2008.

The Fed will be trying to sell 2 percent bonds in a 4 percent world.

 

[Bombur]

The Federal Reserve doesn't have liquidity problems.

Yet. The banks didn't have liquidity problems in 2006, either. When you are in the bubble, you don't have liquidity problems.

Once the asset bubble pops, then the Fed will have liquidity problems. Just like the banks did in 2008.

The Fed will be trying to sell 2 percent bonds in a 4 percent world.

They are setting the rates. You are basically saying they will want to raise interest rates but then act like higher interest rates will make this difficult because of bond prices... or in other words higher interest rates.

The Federal Reserve isn't Citibank, and treasuries are not mortgages. You are making an analogy that fails on all of the important details.

 

[g5000]

They are setting the rates. You are basically saying they will want to raise interest rates but then act like higher interest rates will make this difficult because of bond prices... or in other words higher interest rates.

No, I am saying interest rates will rise beyond their control. That's what inflation does. And their low interest rate bonds will be underwater.

 

[bendog]

Are we mixing the mortgage backed securities the Fed has bought with the Treasuries is customarily buys? If so, the question may be whether the Fed is able to back out of MBS in time.

What will be the Federal Reserve’s investment strategy for agency MBS going forward?
On August 10, 2010, the FOMC directed the Desk to keep constant the Federal Reserve’s holdings of securities at their current level by reinvesting principal payments from agency debt and agency MBS in longer-term Treasury securities. As a result, agency MBS holdings will decline over time. Any future decisions about the investment strategy to be employed will be made by the Federal Open Market Committee.

FAQs MBS Purchase Program - Federal Reserve Bank of New York

 

[Bombur]

They are setting the rates. You are basically saying they will want to raise interest rates but then act like higher interest rates will make this difficult because of bond prices... or in other words higher interest rates.

No, I am saying interest rates will rise beyond their control. That's what inflation does. And their low interest rate bonds will be underwater.

High interest rates will slow down the economy and the money supply.

You are theorizing a world where inflation is high and interest rates are high.

You are treating the Federal Reserve like it is a bank when it really isn't. You are worried about bond prices going down which is exactly what the Federal Reserve would be trying to do. You feel this will result in something bad but it isn't really clear what that is and what justification you have for that assumption.

You are making a strange argument.