Re:US Federal Reserve raises interest rates for first time s...
by ajross on Wednesday March 16, 2022 @07:30PM
(#30705512)
> endless printing of money in the last few years
This didn't happen in a vacuum, though. It was simultaneous (and, obviously, co-causal) with a very rapid economic contraction and a subsequent supply shock across a ton of industries. Any analysis of this situation that starts end ends with "the government printed money" is, IMHO, basically pushing an agenda.
What actually happened is that the device under control (the economy) had an excursion (picture a car blowing a tire and veering) and the government corrected rapidly (prevented it from entering another travel lane, say), but it was something of an overcorrection (the car ran off the shoulder).
Should we have "printed less money"? Probably yes, in hindsight. Was the alternative worse? Of course it was; we were looking at a huge jump in poverty. Was anyone unaware of the inflation risk? No, not really. Was anyone dead-on correct about the right amount of stimulus? Not that I can see.
This didn't happen in a vacuum, though. It was simultaneous (and, obviously, co-causal) with a very rapid economic contraction and a subsequent supply shock across a ton of industries. Any analysis of this situation that starts end ends with "the government printed money" is, IMHO, basically pushing an agenda.
What actually happened is that the device under control (the economy) had an excursion (picture a car blowing a tire and veering) and the government corrected rapidly (prevented it from entering another travel lane, say), but it was something of an overcorrection (the car ran off the shoulder).
Should we have "printed less money"? Probably yes, in hindsight. Was the alternative worse? Of course it was; we were looking at a huge jump in poverty. Was anyone unaware of the inflation risk? No, not really. Was anyone dead-on correct about the right amount of stimulus? Not that I can see.
We'll be fine.