It was a very long time ago that I realised that when looking at financial data – whether accounts or economics information – the key thing to look for is what is not made available.
Well, yes, that’s true. Like, how can people save for their pensions in bonds paying a high interest rate of 1%?
Hmm, sorry? You mean that’s not what you meant?
Double entry requires that the sectoral balances add up to zero. For every borrower there must be a lender, as a matter of fact.
You mean that banks don’t in fact just invent money, they have to lend out depositor funds?
Hmm, sorry? You mean that’s not what you meant?
Five years of mortgage rates at 5% or more is going to bring unimaginable financial stress. And since mortgage rates roll straight over into private rents those in that sector are also going to face intolerable stresses.
Prices – rents or just prices, makes no difference – are cost plus now, are they?
Hmm, sorry? You mean that’s not what you meant?
And I stress, it is money supply that is needed to get through what is going to happen. Inflation creates a shortage of money. If money is worth less we need more of it to keep the economy going. It really should not be rocket science to work that out.
And that’s just laughable.
Tax cuts, spending increases, more government borrowing and probably QE, and lower interest rates are all required.
Sigh. Weimar here we come……
” Inflation creates a shortage of money. ”
I’ve always been able to create my own shortage of money, indeed most people and all governments can.
(Too voluble today, I’m gonna shut up.)
Then again, Ritchie is quite selective in his hypocrisy. Certain things are absolutes to be shouted from the rooftops, until the real world clearly demonstrates that reality is other, then Ritchie mutters and changes the topic (as with QE will never be unwound, QE has no cost, etc.).
It’s actually hard to keep up with whatever absurd idea Ritchie he is pontificating about on any one day (fifthly, perhaps even ninthly). I’ve come to the conclusion that he is suffering from some form of multiple personality disorder wherein there are an infinite number of Ritchie’s all believing different things at the same time and it’s just a matter of which one is holding the mental conch and gets to speak.
It’s beyond cognitive dissonance and closer to the chaotic behaviour of crowds.
If I had a time machine (and better German), I’d love to visit Berlin during the Weimar period…but I’d take US Dollars. 🙂
“And I stress, it is money supply that is needed to get through what is going to happen. Inflation creates a shortage of money. If money is worth less we need more of it to keep the economy going. It really should not be rocket science to work that out.”
Holy fucking crap. How can anyone be so stupid?
One answer is it’s Spud. The other is that he doesn’t believe the money equation, MV=PQ. Because Friedman agreed with it, so therefore it must be wrong. If V changes then we need less M, not more, but that’s the money equation for Spud doesn’t believe it. Or, the same thing in another guise, if broad money is increasing (it is) then we need less narrow money, not more.
“Sigh. Weimar here we come……”
And it never occurred to you that when you supported the BoE printing money and injecting it into the economy via QE that Weimar was the ultimate destination of the train you’d just waved enthusiastically out of the station? When exactly in history has a country managed ‘just a little bit’ of money printing? And had the self control to stop once the existential crisis was past, and put everything right again sharpish? Or have they (being human beings after all) always thought they’d invented an economic perpetual motion machine that would make everyone rich by doing nothing?
In the Carboniferous Epoch we were promised abundance for all,
By robbing selected Peter to pay for collective Paul;
But, though we had plenty of money, there was nothing our money could buy,
And the Gods of the Copybook Headings said: “If you don’t work you die.”
The Gods of the Copybook Headings
Rudyard Kipling
Is Velocity so unobservable that it is akin to Catachism?
Invest in wheelbarrows. Not wheelbarrow stocks, actual wheelbarrows to carry enough cash about to pay for the weekly shop. Or a daily shop to avoid the prices going up several times a week.
Or are you ppl just indulging your catastrophe porn addiction?
The thing about inflation is that there has to be more money to pay the higher prices.
Is Velocity so unobservable that it is akin to Catachism(sic)?
Think back a few centuries to when money was largely physical. Although you can’t easily track individual coins or notes to see how many times they change hands within a given period, ‘velocity’ is easy enough to work out from MV=PQ. And it equally holds true in a digital world.
Velocity of money is significantly more ‘real’ than, say, potential energy in physics.
This is the way the world ends. Not for our species a giant meteorite crash causing catastrophic ‘climate change’ (sic). For us it will be the cumulative effect of the utter stupidity of clowns like Spud all egged on by a power mad extractive class bent on bringing Marxism to all of us whatever the cost.
“Inflation creates a shortage of money.”
What the everlovin’ fuck?