quote:
quote: Powell is irrelevant with debt/gdp at 125%. The $1T in interest paid to boomers is stimulative. If he cuts it's stimulative. Either way, with boomers now retiring en masse debt goes parabolic. Fiscal is driving everything, aka we've entered fiscal dominance. Look to the 1940s for guidance because that's where we are. The entitlement ponzis have been destined to sink the ship since Clinton and Bush exported our industrial base. A service economy can't support the entitlement paygos.

quote:
Resulting in what?

Debt spiral

This post was edited on 3/13/24 at 5:54 am

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Posted by Big Scrub TX

Member since Dec 2013

33403 posts

Posted on 3/13/24 at 10:36 am to Art Blakey

quote:
Debt spiral

Say more.

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Posted by Art Blakey

Member since Aug 2023

88 posts

Posted on 3/13/24 at 11:29 am to Big Scrub TX

quote:
Say more.

I rambled quite a bit in the thread below. Since starting that thread debt/gdp has gone from 120 to 123.5%. My view since starting that thread has shifted some. I was convinced for the first year or two of this hiking cycle that the Fed would break something like they always do and reverse course. Now I'm leaning more in the direction of current fiscal spending is overpowering Fed policy completely. Consumers largely termed out their mortgage debt prior to the hiking cycle, same with corps. Who didn't term out their debt during covid? The US govt. Under a higher for longer regime the US govt breaks first.

LINK /

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Posted by Big Scrub TX

Member since Dec 2013

33403 posts

Posted on 3/13/24 at 12:38 pm to Longhorn Actual

quote:
Inflation vs. relative price.

Certainly you know the difference, and how the "basket" in the aggregate is not representative of the specific things in the basket because of differences in price elasticity among various items.

And how price-elasticity within the basket drives the inflationary items even higher and the deflationary items even lower, causing the aggregate inflation number to remain the same while the guts of the basket are drastically different.

And also how fixed-and lower-income households are less able to reduce spending since they're spending mostly on essentials.

And how those things tie into/affect each other.

But yeah, "3.5%...just a smidge too high."

Seems like the bar is always moving.

quote:

I'd love to hear it. DEflation isn't generally a good thing, but I don't see it happening anyway. If it does, we're already screwed.

Well, this level of deficit spending is certainly holding it at bay in short/medium term. But China will have it and ultimately export it.

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Debunked by Big Scrub TX! Well, by God, that settles it then.

I mean, the numbers are the numbers. Yes, monthly numbers are revised. Over time, the revisions just aren't that material (or at least they haven't been).

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While you're at it, please explain the difference between U-3 and U-6, which one they use/report, and which one is actually more useful with regard to wise policy making.

I don't disagree that U6 is more useful. As I'm sure you're aware, U6 is basically at a historic low as well.

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