"The 2%" (no, not "The 1%")
It seems these days we've heard more about "The 2%" than "The 1%", that group of the world's wealthiest the media obsesses?over. "The 2%" refers to the endless chatter around where the FED and many economists believe the rate of inflation should be.
High inflation is debilitating to many. The questions I have around this belief are not from the mind of an accomplished economist at all, but merely my own based on logic and what I see. So while I do not have the answers, I do have the questions:
1.?If housing is a big part of higher inflation, surely the only way to bring down prices is to build more, not less? Especially when we are badly under-built. Higher interest rates designed to lower inflation ADD to the cost of housing.
2.?How is it possible to bring down the costs of housing - or at least reduce price increases to 2% - when massive swaths of raw materials and labor are being used for a $1 trillion - fully funded - infrastructure?program?
3.?How is it possible to reduce price hikes on products when shifting production from?far off places with cheaper labor to the US with much higher?costs to manufacture?
4.?How can you lower labor costs without more skilled labor, probably most easily and quickly fueled via immigration and work visas?when our immigration/visa departments are painfully slow and inefficient?
5.?How can you reduce price hikes when many industries have 'gotten away' with massive price hikes well beyond their higher costs and supply chain issues?
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6.?When wages rise higher than the rate of inflation for the lowest paid amongst us, surely that is good for a society where the wealth disparities have swelled far too much? Surely a correction via wage increases is healthy?in allowing all who are employed?to be able to live without - taxpayer-paid-for-government assistance?
7.?If forcing layoffs and unemployment is the only means the FED sees to reduce price hikes to 2%, who picks up the tab for the federal assistance to the unemployed? Who houses the homeless and pays for that? Who pays for the bankruptcies? Who pays for the defaults on loans?
I may only have the answer to #7:?you and me. Yes, we will all have to pay a big price for the damage too high rates can trigger. Those who have hoarded cash over the past 3 years are the vultures that will swoop in and buy up any bargains, further escalating wealth disparity.
Maybe a (limited) period of slightly higher inflation is not such a bad thing? Especially if the higher inflation is more focused on wages than other things that are artificially fueled by 'profit drivers', not necessity? Surely there has to be a better way to lower inflation than simply making people lose their jobs? Unless of course we want a low inflation, higher-taxes-to-pay-for-the-unemployed environment?
What do I know!?
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1 年What data are you basing that on??