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Re:The ballooning money supply may be the key to unlocking i... by lordnacho on Tuesday October 13, 2020 @05:00PM (#24770246)
I don't often write meta-comments, but it's interesting to see the two large threads here.

One of them is about whether the Fed is printing money.

The other one is about what inflation is, or how it ought to be measured.

I find it fascinating that there's so much confusion about all these economic terms. I don't have a simple answer to either, but it's thought provoking that there isn't an established theory that everyone can point to from which people can comfortably say what different things mean. If you had a physics debate about black holes or whatever, it would normally be quite clear if someone had misunderstood something. At least when the threads got deeper, it would become clearer and some authoritative comment would appear.

I have an economics degree from a well known university, and I'm still not entirely sure what to think of those threads. They are so meandering, each new commentator rectifying an old definition or seeking to add yet another concept.

That should say something about how confidently we can make economic decisions.

Re:The ballooning money supply may be the key to unlocking i... by nkurz on Tuesday October 13, 2020 @05:41PM (#24770639)
> it's interesting to see the two large threads here. One of them is about whether the Fed is printing money. The other one is about what inflation is, or how it ought to be measured.

Observant, but you are most likely seeing the result of 'dang' changing the URL from the article about printing money to the one about how to measure inflation! https://news.ycombinator.com/item?id=24770185

Was: "22% of all US Dollars were created in 2020" https://old.reddit.com/r/Bitcoin/comments/j6ud5u/22_of_all_u...

Now: "The ballooning money supply may be the key to unlocking inflation in the U.S." https://www.cnbc.com/2020/08/05/the-ballooning-money-supply-...

Re:The ballooning money supply may be the key to unlocking i... by BoiledCabbage on Tuesday October 13, 2020 @11:48PM (#24772939)
I think you completely missed the point.

OP's post isn't about that fact that two different topics are being discussed. OPs point is that for neither of this two topics that are critical to economic theory, people don't even seem to know or agreed on the definition of either. How in the world can people discuss (let alone judge or shape) policy if we can't even agree on what basic concepts even mean.

Re:The ballooning money supply may be the key to unlocking i... by smallnamespace on Tuesday October 13, 2020 @06:25PM (#24771015)
This is what's simultaneously so fascinating and frustrating about macroeconomics!

At the local scale, one can take for granted that definitions are stable and many laws are immutable: if I go into debt, I must pay it back; I can't create money out of thin air; money is defined as dollars; I must pay my taxes, etc.

But the macroeconomy is the entire system, and in complex systems, everything affects everything. Causal feedback loops run in both directions (A causes B causes A again). Money, debt, taxation, etc. are all creations of human society, and can be modified.

But even though humans made these definitions, they're not quite fully in our control.

Like on the one hand, we just made it all up, just like how US dollars went from gold-backed to fiat overnight.

But then, if you really attempt too much magic, it doesn't work. If you print money and spend more than you have, then you can turn into Venezuela, where there is truly hyperinflation and the dollar again becomes de facto currency (despite the government's halting attempts to outlaw this).

So economic laws have this dual aspect where on the one hand, it's simply a human invention, but on the other hand it appears to reflect some deep laws of nature regarding how energy and information flows through our societies, and you can't push the definitions too far from reality on the ground.

Re:The ballooning money supply may be the key to unlocking i... by marcosdumay on Tuesday October 13, 2020 @05:12PM (#24770353)
Monetary theory has some very well defined concepts. But those only appear on the equations, and when people go naming them they go and mix with the same names they use on unrelated discussions.

And then we get some completely ridiculous things like people arguing that the Keynes return of investments apply to each investment inside an economy.

Re:The ballooning money supply may be the key to unlocking i... by cynicalkane on Tuesday October 13, 2020 @05:24PM (#24770492)
I don't think this is exactly it. One can try -- and try fruitfully, for these theories have been useful in practice -- to match 'money' and 'inflation' and 'debt', in their macro senses, to everyday experience, with the caveat that they're aggregate concepts that affect individuals and various productive activities differently, and that they (money especially) can behave a little weird.

What happens instead is that people have feelings about what these concepts are supposed to mean, and then use that to make a political statement. The reason armchair- and pseudo-economists are so eager to say things like "Money is really about X" or "Money is really about the opposite of X" is they want to hijack the word 'money' and the meaning it has in the brain and turn that into politics.

These confident takes are more directly engaging, whereas economic pronouncements are wonky and weird in a way that's more relatively neutral or at least not obviously political, so the gravitation is towards the bad and confusing takes.

Re:The ballooning money supply may be the key to unlocking i... by kortilla on Tuesday October 13, 2020 @06:19PM (#24770966)
Don’t forget, the closer you get to things that affect people’s lives, the more they will be compelled to knee jerk react.

If people fuck up on the understanding of black holes, it doesn’t matter for the economy. If people fuck up economics, it can mean the next Great Depression.

Re:The ballooning money supply may be the key to unlocking i... by LuvSauce on Tuesday October 13, 2020 @05:22PM (#24770471)
It is said that keynesians and free market economists both would find themselves at the ire of other intellectuals. Taleb lamented that economists are rated by other economists so we can't be sure they're correct. Even the greatest economist said that economists are not reliable.