I remember Mark Russell, the legendary comedian/satirist, reacting to Bush's "Read my lips--no new taxes." Russsell quipped: "Yeah, he'll raise the old ones."
I applaud your use of M-o-M annualized % in the analysis. Almost everything reported and discussed is Y-o-Y which mostly reflects the inflation that occurred quite a long while ago. Financial markets reacted to recent Y-o-Y decreases as if something actually happened in the last month rather than recognizing that the Y-o-Y change was predominantly reflective of dropping a high inflation value that occurred 13 months prior. Even if all future M-o-M annualized rates were at the 2% target (i.e. M-o-M rates at 0.16515 %) the reported Y-o-Y values would stay above 2% for another 6 months for CPI and another 8 months for PCE (I projected those using actual historical data).
Here's Roger Bootle - a very mainstream New Keynesian in the UK: "I don’t think the Bank can contemplate reducing rates until it is sure that pay inflation – the key guide to underlying inflation – is subsiding. This will require a significant easing in the labour market and an increase in unemployment."
It's pretty clear that mainstream thought is all about increasing the unemployment buffer stock by taxing mortgage and rent payers via interest rate rises.
Or the "Prole Tax" as it should perhaps be called.
Oh, Stephanie, there are days I just want to scream and this is one of them. I’ve been avoiding your newsletter throughout all the inflation talk, because I knew that every day would be a day I would want to not only scream, but perhaps try to kill anyone who uttered one more ridiculously false myth about inflation or economics in general.
When the Bidens went to Saint Croix for their holiday, I could not believe the missed opportunity. Saint Croix is, of course, where Warren Mosler lives, and I had this glorious fantasy of the Bidens enjoying a long, leisurely lunch at the Mosler’s. In my dream, I could see Biden’s eyes light up in that moment of comprehension – not unlike Luigi Spaventa’s did when he was the Assistant Treasury Secretary or Treasury Secretary in Italy and Warren, with a couple of questions, enabled him to see that the Italian Treasury was acting procyclical for absolutely nothing. I love that story.
But, as to the urge to scream or maim this morning … What can be done?
First, I thought of an open letter by the country’s thinking economists, but you’ve done that in support of child care relief. I haven’t followed up to see what, if any, effect that letter had or is having, but I’m certain it didn’t sway the hearts or minds of the millions of Americans who have such strong opinions about economics.
The way that misunderstood economic terms trigger reactions in the minds of the public has to be addressed. I mean nearly everyone in the entire country believes the false narratives of economics. Hell, most economists believe them. Changing people’s minds about these corruptive myths is an overwhelming endeavor. How do we do it?
When I think about this (and I think about it a lot), the only solution that keeps coming back, over and over again, is ADVERTISING. Yep, the good old American way. Too simplistic? I don’t think so; the brilliance of MMT is its simplicity, exactly as is the brilliance of Warren Mosler’s mind. Very few people have the ability to look at a thing as something that didn’t exist before and to apply pure logic to it. Warren has that kind of mind. As does advertising.
ADVERTISING is designed to cut through all preconceptions and apply a logical conclusion. The logical conclusion doesn’t even have to be the truth, as far as advertising is concerned, because in itself, advertising has no bias; it has only the parameters we assign to it, be they true or false. But when it’s good, advertising is simple and logical. It’s not easy to make it good, and acquiring converts to a macroeconomics seen through an MMT lense, will make it more difficult than usual because, well … economics.
Deeply entrenched misconceptions for the entirety of our lives. But what could be more challenging, more important, and more fun than creating that campaign? What’s the target group? Everyone? Do you create different campaigns for different target groups – age, economic status, culture, politics, etc?
Hey, the fascists have been doing it for as long as they’ve been around. Keep it simple. Capture minds. Kill everyone!
China 3% inflation and Japan 2% while the West has much higher, with similar supply chain issues. Corporate Greed is the reason and that needs to be addressed, otherwise all us little people will continue to be crushed with these rate hikes.
I have question about how the members of the Ged feels about making these decisions. Is any thoughts ever given to the people whose life is adversely impacted by ‘slowing the economy’ or do they have to distance themselves from thinking about that; like a general ordering young soldiers to certain death.
Stephanie: There is worry about the House not being able to rise the debt ceiling when we near it later this year. Why can't the federal government create enough currency to pay off whatever amount of the debt is necessary to keep the total debt well below the ceiling forever? Why does the federal government need to borrow money in the first place?
Book recommendation for all here. Edward Chancellor's "The Price of Time - The Real Story of Interest". Published last year, it is well-researched and demonstrates the following:
Credit booms, bubbles, & busts are as old as recorded history.
The root cause of them all was cheap & easy money. 2% interest rates seems to be the floor level rate where mischievous really begins.
Speculation and over-heated construction expansions are unleashed with cheap credit. Many are mal-investments that continued under cheap & easy money.
You'll learn about the plethora of central banker mistakes over the past two decades. It began with Greenspan at 9/11 and the mistakes have just compounded since.
The Fed employs more Ph.d economists than any other institution. They rely on sophisticated economic models that don't adequately understand the bigger picture. They certainly don't consider history. They engage in group-think and can't countenance that maybe, just maybe, they're missing something.
Inflation may be moderating. But higher prices remain embedded. Any tightening in energy prices will also add back to inflationary pressures.
MMT and endless money supply expansion are not modern and they are not innocuous. They're why we had CPI-U at 7% to 8%. These policies cannot continue.
The “hot” topic of the day is that the debt is a huge problem that will be the downfall of the country. And, virtually every newscaster and commentator has picked up and parrots this story. Where are the MMTers calling out this misplaced view and explaining the misconceptions behind this false scare story?
I remember Mark Russell, the legendary comedian/satirist, reacting to Bush's "Read my lips--no new taxes." Russsell quipped: "Yeah, he'll raise the old ones."
I applaud your use of M-o-M annualized % in the analysis. Almost everything reported and discussed is Y-o-Y which mostly reflects the inflation that occurred quite a long while ago. Financial markets reacted to recent Y-o-Y decreases as if something actually happened in the last month rather than recognizing that the Y-o-Y change was predominantly reflective of dropping a high inflation value that occurred 13 months prior. Even if all future M-o-M annualized rates were at the 2% target (i.e. M-o-M rates at 0.16515 %) the reported Y-o-Y values would stay above 2% for another 6 months for CPI and another 8 months for PCE (I projected those using actual historical data).
Where is that chart from?
Here's Roger Bootle - a very mainstream New Keynesian in the UK: "I don’t think the Bank can contemplate reducing rates until it is sure that pay inflation – the key guide to underlying inflation – is subsiding. This will require a significant easing in the labour market and an increase in unemployment."
It's pretty clear that mainstream thought is all about increasing the unemployment buffer stock by taxing mortgage and rent payers via interest rate rises.
Or the "Prole Tax" as it should perhaps be called.
Why is the FOMC myopically focused on wage growth, which is long overdue and deserves a long upside, instead of corporate profits/price gouging?!?!
Oh, Stephanie, there are days I just want to scream and this is one of them. I’ve been avoiding your newsletter throughout all the inflation talk, because I knew that every day would be a day I would want to not only scream, but perhaps try to kill anyone who uttered one more ridiculously false myth about inflation or economics in general.
When the Bidens went to Saint Croix for their holiday, I could not believe the missed opportunity. Saint Croix is, of course, where Warren Mosler lives, and I had this glorious fantasy of the Bidens enjoying a long, leisurely lunch at the Mosler’s. In my dream, I could see Biden’s eyes light up in that moment of comprehension – not unlike Luigi Spaventa’s did when he was the Assistant Treasury Secretary or Treasury Secretary in Italy and Warren, with a couple of questions, enabled him to see that the Italian Treasury was acting procyclical for absolutely nothing. I love that story.
But, as to the urge to scream or maim this morning … What can be done?
First, I thought of an open letter by the country’s thinking economists, but you’ve done that in support of child care relief. I haven’t followed up to see what, if any, effect that letter had or is having, but I’m certain it didn’t sway the hearts or minds of the millions of Americans who have such strong opinions about economics.
The way that misunderstood economic terms trigger reactions in the minds of the public has to be addressed. I mean nearly everyone in the entire country believes the false narratives of economics. Hell, most economists believe them. Changing people’s minds about these corruptive myths is an overwhelming endeavor. How do we do it?
When I think about this (and I think about it a lot), the only solution that keeps coming back, over and over again, is ADVERTISING. Yep, the good old American way. Too simplistic? I don’t think so; the brilliance of MMT is its simplicity, exactly as is the brilliance of Warren Mosler’s mind. Very few people have the ability to look at a thing as something that didn’t exist before and to apply pure logic to it. Warren has that kind of mind. As does advertising.
ADVERTISING is designed to cut through all preconceptions and apply a logical conclusion. The logical conclusion doesn’t even have to be the truth, as far as advertising is concerned, because in itself, advertising has no bias; it has only the parameters we assign to it, be they true or false. But when it’s good, advertising is simple and logical. It’s not easy to make it good, and acquiring converts to a macroeconomics seen through an MMT lense, will make it more difficult than usual because, well … economics.
Deeply entrenched misconceptions for the entirety of our lives. But what could be more challenging, more important, and more fun than creating that campaign? What’s the target group? Everyone? Do you create different campaigns for different target groups – age, economic status, culture, politics, etc?
Hey, the fascists have been doing it for as long as they’ve been around. Keep it simple. Capture minds. Kill everyone!

China 3% inflation and Japan 2% while the West has much higher, with similar supply chain issues. Corporate Greed is the reason and that needs to be addressed, otherwise all us little people will continue to be crushed with these rate hikes.
Good morning,
I have question about how the members of the Ged feels about making these decisions. Is any thoughts ever given to the people whose life is adversely impacted by ‘slowing the economy’ or do they have to distance themselves from thinking about that; like a general ordering young soldiers to certain death.
Stephanie: There is worry about the House not being able to rise the debt ceiling when we near it later this year. Why can't the federal government create enough currency to pay off whatever amount of the debt is necessary to keep the total debt well below the ceiling forever? Why does the federal government need to borrow money in the first place?
Book recommendation for all here. Edward Chancellor's "The Price of Time - The Real Story of Interest". Published last year, it is well-researched and demonstrates the following:
Credit booms, bubbles, & busts are as old as recorded history.
The root cause of them all was cheap & easy money. 2% interest rates seems to be the floor level rate where mischievous really begins.
Speculation and over-heated construction expansions are unleashed with cheap credit. Many are mal-investments that continued under cheap & easy money.
You'll learn about the plethora of central banker mistakes over the past two decades. It began with Greenspan at 9/11 and the mistakes have just compounded since.
The Fed employs more Ph.d economists than any other institution. They rely on sophisticated economic models that don't adequately understand the bigger picture. They certainly don't consider history. They engage in group-think and can't countenance that maybe, just maybe, they're missing something.
Inflation may be moderating. But higher prices remain embedded. Any tightening in energy prices will also add back to inflationary pressures.
MMT and endless money supply expansion are not modern and they are not innocuous. They're why we had CPI-U at 7% to 8%. These policies cannot continue.
Corporate profits, which are at an all-time high, ARE the primary cause of inflation: www.epi.org/blog/corporate-profits-have-contributed-disproportionately-to-inflation-how-should-policymakers-respond/
Eggs now $7 / dozen and in short supply in some areas.
https://news.yahoo.com/7-dozen-why-california-eggs-130037452.html
Love the subtitle: ”Fed officials pledge to stay higher for longer.“
Where are you?
The “hot” topic of the day is that the debt is a huge problem that will be the downfall of the country. And, virtually every newscaster and commentator has picked up and parrots this story. Where are the MMTers calling out this misplaced view and explaining the misconceptions behind this false scare story?