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What actually causes inflation to slow down and stop?

Posted on 10/11/24 at 4:03 pm
Posted by baybeefeetz
Member since Sep 2009
32352 posts
Posted on 10/11/24 at 4:03 pm
As I understood it from my economics professor, inflation happens when the money supply expands. Prices can’t go up forever if the money supply isn’t still going up, so then prices just stay where they are. Is this not true?

I’m asking because there was some law passed to tackle inflation, but I think it was just government spending?
This post was edited on 10/11/24 at 4:07 pm
Posted by StarksofWinterfell8
Member since Oct 2024
56 posts
Posted on 10/11/24 at 4:04 pm to
The complete collapse of the dollar which is imminent
Posted by Riverside
Member since Jul 2022
5604 posts
Posted on 10/11/24 at 4:05 pm to
Companies will begin cutting prices to spur more sales once this hyper inflationary environment is halted. It’s how markets work.
Posted by 91TIGER
Lafayette
Member since Aug 2006
18907 posts
Posted on 10/11/24 at 4:06 pm to
quote:

As I understood it from my economics professor


Probably best to disregard anything this retard told you. When you print money with nothing to back it up it makes what you have worth less. Prices will continue to go up. The so called "inflation reduction act" was nothing more than printing more money on New Green Deal nonsense. Oh, and it was just government spending to buy votes.
Posted by Sofaking2
Member since Apr 2023
13660 posts
Posted on 10/11/24 at 4:07 pm to
If we would cut back on government spending it would go a long way.
Posted by baybeefeetz
Member since Sep 2009
32352 posts
Posted on 10/11/24 at 4:07 pm to
lol if I told you my prof was, I have no doubt you would edit that post.
Posted by auggie
Opelika, Alabama
Member since Aug 2013
29913 posts
Posted on 10/11/24 at 4:07 pm to
Lack of demand. For instance, pet food prices have probably stabilized in Springfield, Oh.
This post was edited on 10/11/24 at 4:09 pm
Posted by John Barron
The Mar-a-Lago Club
Member since Sep 2024
15682 posts
Posted on 10/11/24 at 4:08 pm to
Removing the demand. You let 15 million illegal aliens into the country and giving them taxpayer money for food and shelter caused massive inflation. Remove the 15 million people you let in and the demand for food and shelter will decrease and so will the prices.
Posted by baybeefeetz
Member since Sep 2009
32352 posts
Posted on 10/11/24 at 4:09 pm to
Posted by NC_Tigah
Make Orwell Fiction Again
Member since Sep 2003
131732 posts
Posted on 10/11/24 at 4:09 pm to
quote:

As I understood it from my economics professor, inflation happens when the money supply expands.
Inflation increases when demand > supply. Demand increases with money supply expansion.
Posted by RaginCajunz
Member since Mar 2009
6650 posts
Posted on 10/11/24 at 4:10 pm to
That's a very good question. Stop printing or expanding the money supply faster than the natural growth of the economy. Stop overspending, contract the government. Then, the natural growth will overtake the overspending to a more natural equilibrium.
Posted by GumboPot
Member since Mar 2009
133841 posts
Posted on 10/11/24 at 4:11 pm to
Posted by FreddieMac
Baton Rouge
Member since Jun 2010
24553 posts
Posted on 10/11/24 at 4:12 pm to
quote:

Companies will begin cutting prices to spur more sales once this hyper inflationary environment is halted. It’s how markets work.


They have to stop printing money and running such large deficits. Debt is reasonable but annual deficits like this is causing inflation. Its not hard, more money supply, more inflation.
Posted by momentoftruth87
Your mom
Member since Oct 2013
85541 posts
Posted on 10/11/24 at 4:12 pm to
Books are cooked so it’s a bit difficult to give you the proper answer without analyzing all the variables with true data. There are a few immediate things that can be done that will stop inflation but we aren’t going back to prices we were used to. We will always have inflation but it’s out of control the last 6 years with a lot of issues we faced and how the govt has spent out their arse.
Posted by John Barron
The Mar-a-Lago Club
Member since Sep 2024
15682 posts
Posted on 10/11/24 at 4:15 pm to
quote:

Demand increases with money supply expansion.


It also increases when you let in 15 million illegal aliens and give them taxpayer money for food and shelter
Posted by GumboPot
Member since Mar 2009
133841 posts
Posted on 10/11/24 at 4:18 pm to
quote:

Stop printing or expanding the money supply faster than the natural growth of the economy.


Do we understand how this happens?
Posted by John Barron
The Mar-a-Lago Club
Member since Sep 2024
15682 posts
Posted on 10/11/24 at 4:18 pm to
quote:

There are a few immediate things that can be done that will stop inflation 


Incorrect, remove 15 million illegal aliens from the country and I guarantee food and housing prices decrease.
Posted by GumboPot
Member since Mar 2009
133841 posts
Posted on 10/11/24 at 4:19 pm to
quote:

ooks are cooked so it’s a bit difficult to give you the proper answer without analyzing all the variables with true data. There are a few immediate things that can be done that will stop inflation but we aren’t going back to prices we were used to. We will always have inflation but it’s out of control the last 6 years with a lot of issues we faced and how the govt has spent out their arse.


Current monetary system is designed to have 2% inflation year over year.
Posted by SquatchDawg
Cohutta Wilderness
Member since Sep 2012
17062 posts
Posted on 10/11/24 at 4:19 pm to
Monetary Inflation is too much money chasing too few good. The other piece is additional costs that go into the production of goods.

For 1, higher interest rates slow debt creation which is inflationary. Keep higher rates and you see less borrowing to chase existing goods. Leas demand equals lower prices. Also, M&A and asset investing is all driven by the cost of capital….higher costs for debt then you get less of that. Our govt is creating an extra $2T of money per year in deficit spending via debt creation.

The second half is the regulatory burden that goes into the cost of goods. You tell Ford they have to average 40 mpg, the cost of your F150 goes up. You tell meat processors they have to meet new EPA guidelines, the cost of meat goes up. If the cost of electricity and fuel goes up due to Green bullshite, everything gets more expensive.

As for Congress, they can do two things.

1. Stop creating money via deficits that get pumped into the economy -ie monetary inflation. If you create an extra $2T in money via debt issuance it has an impact.

2. Reduce the regulatory mandates on industry and energy so the cost to produce goods is lower.
This post was edited on 10/11/24 at 4:23 pm
Posted by GumboPot
Member since Mar 2009
133841 posts
Posted on 10/11/24 at 4:22 pm to
Who prints money to cause inflation?

Who gave this entity the authority to print money?

Who sets interest rates?

How are interest rates set?

Do "they" just push a button or do they have to do something to make it so?

And if they have to do something to achieve a stated interest rate, what is it they are doing?

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