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Inflation erased U.S. income gains last year

(www.wsj.com)
177 points JumpCrisscross | 1 comments | 09 Sep 25 19:44 UTC | HN request time: 0.204s | source
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argentinian ◴[09 Sep 25 22:18 UTC] No.45190101[source]▶
Do people in the U.S. have a good understanding of the causes of inflation?
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OgsyedIE ◴[09 Sep 25 22:26 UTC] No.45190196[source]▶
Not even most economists do, by analogy to how opaque the questions of lifting bodies and rayleigh scattering are to physicists.
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Eddy_Viscosity2 ◴[09 Sep 25 22:31 UTC] No.45190266[source]▶
Yeah no, economists and a lot of people understand the the causes of inflation. There are economists who are paid very well to not understand it though, and such positions are often high in the government and financial sector hierarchies.
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chrisco255 ◴[10 Sep 25 00:26 UTC] No.45191500[source]▶
Are these the same Fed economists that claimed the elevated inflation levels were transitory in 2021?

There are multiple schools of thought on causes of inflation, but generally I agree with late Milton Friedman that it is "everywhere and always a monetary phenomenon". Money supply expansion growing faster than GDP expansion causes inflation.

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ceejayoz ◴[10 Sep 25 00:36 UTC] No.45191585[source]▶
> Are these the same Fed economists that claimed the elevated inflation levels were transitory in 2021?

But… that was correct? It went up, then back down, due to a very unusual (almost unique, thus far) external cause.

https://www.statista.com/statistics/273418/unadjusted-monthl...

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1. bigbadfeline ◴[10 Sep 25 05:25 UTC] No.45193657[source]▶
>> elevated inflation levels were transitory in 2021But… > that was correct?

No, it wasn't correct. By "transitory" the Fed meant "no need to do anything, inflation will go down on its own". It didn't go down on it's own, and the Fed had to act, too little too late, which is now causing prolonged inflation problems.

> It went up, then back down, due to a very unusual (almost unique, thus far) external cause.

The cause wasn't external, neither unusual nor unique, it was the Fed's start of interest rate increases, precisely at the time the inflation trend reversed.