What is the Job of the Fed Res

No, it's the central bank's job via inflationary monetary policy. Of course, the central bank does their job with the tacit approval of both Republicans and Democrats, but that is a different matter entirely.

 

I don't know about Austrians, but this American thinks somebody lost track of the demand side of the equation.

 

To assist congress in defying the immutable laws of economics.

 

No, its the Republicans job via tax cuts, deregulation and cutting social programs. Of course, the Republicans do it with the tacit bribery of the richest, but that is another matter entirely.

Inflation never hurt any worker who saw his income rise faster than prices.

 

Last time I check, monetary has more to do with inflation/deflation than fiscal policy. Geez Iriemon, would you stop your boring song "Republican is baaaaaaaaaaaad.........Democrat is goooooddddddd.?

 

I'm not interested in your obsession with the Republicans. Please stay on topic.

Well, good for them. I guess as long as you are able to continually negotiate a raise with your employer, you shouldn't have to worry about it. But for workers who have little to no bargaining power, they're out of luck and will simply have to watch their standard of living decline in order to keep bankers and speculators rich. Of course, this doesn't take into consideration the impact inflation has on a person's savings, so we're only looking at half the issue.

 

Me too.

My opinion that the Republican party's primary goal is to protect and promote the wealth of the richest in this country is one that is amptly supported by almost every political act the Republican party takes.

 

About as interested as I am in your obsession with the Fed.

My comments were directly on point in rebuttal to yours.

True.

Or get a better job.

Savings are pretty modest for most of the nation's poorer folks.

 

Deregulation doesn't require the government to pass more regulations. It requires the repeal of regulations. A lack of regulation means that you believe that there need to be more regulations.

Obviously not. We had the biggest bank failures in US history just a few years ago.

How so?

 

In case you hadn't noticed, this thread is about the Fed, which is why I commented on the Fed.

Since I didn't mention the Republicans, and since this thread is not about the Republicans, I don't see how your response was at all "on point".

Not always an option. More importantly, they shouldn't have to get a better job just so they can stay ahead of inflation. That is an immoral compulsion.

Everyone's savings are eroded by inflation.

 

Both were evident in the financial industry and subprime mortgage crisis.

That doesn't follow.

I take it back.

How would free banking be a solution?

 

I disagreed with your assertion about the Fed and explained why.

I never said anyone had to get a better job. I said: "Inflation never hurt any worker who saw his income rise faster than prices."

Not if they grow faster than inflation.

 

Your explanation did not concern the Fed. It concerned the Republicans, which neither I nor the OP mentioned.

Interesting. You already forgot what you said just a few minutes ago.

Getting a better job is not always an option, especially for people in the lower socioeconomic strata of society. Inflation depresses their standard of living.

Which won't happen when the central bank is depressing interest rates.

 

Repetitive. Addressed above.

My statements are not contradictory in the least. I never said anyone had to get a better job. But if they get a better job and their income increases faster than inflation, they aren't hurt by it. It doesn't matter how their incomes increase as long as it increases faster than inflation.

That is true. Keeping your job and getting another one at the same salary is not always an option either.

Inflation only depresses their standard of living if their income does not keep up with inflation, or fall relative to prices.

Depends.

 

It only depresses their standard of living if wages do not increase faster than inflation. The funny thing is people assume life would be like it is now with out inflation and that we can simply just revert back to no inflation or even deflation.

Yea right... if you think the poor have it bad with inflation you don't want to see how bad they have it with deflation, lol.

 

For anyone who owes money for a car, mortgage or student loans, losing purchasing power due to a steady income losing ground to inflation can be better than than steady purchasing power but declining income because of deflation.

 

If I'm being repetitive, it's because you haven't appropriately explained yourself.

You claim your disagreement with me concerned the Federal Reserve, but your rebuttal didn't even mention the Federal Reserve. Instead, you brought up the Republicans for some odd reason, despite the fact that no one had mentioned them.

They have to get a better job if they don't want their standard of living to be depressed by inflation, but since that is not always an option, especially for poor people, not everyone can take advantage of your glib prescription.

And if they won the lottery, they'd be millionaires. But winning the lottery isn't something you can count on to save you from the slow degradation of inflation, just like getting a better job isn't an option available to everyone, the poor especially.

And when their income does not keep up with inflation, their standard of living is lessened.

It does depend, but for anyone who earns less from their savings than inflation, their savings are being eroded.

 

Yes, I'm aware. That does not always happen, though.

I do not make such an assumption.

Yes, being able to buy more goods and services is definitely bad for poor people.

 

Declining income due to deflation isn't necessarily bad. As long as they're able to buy more goods and services, it doesn't matter what the nominal value of their income is.

 

But you are still assuming they would have money in the first place based on how much they make now. That is the point. People wouldn't be making what they make now if we experienced deflation. Wages would fall, jobs would be lost, and money owners would have all the power.

 

It wouldn't matter as long as they were capable of purchasing more goods and services. The nominal value of their income is irrelevant.

But the value of their dollar would increase.

Speculation.

As opposed to our current system...

 

That's a BIG if you got going on. The nominal value of income is relevant when you don't have an income.

What if they don't have any dollars?

You are making this massive assumption that they would have the money they have now under your theory of no inflation or deflation.

 

Actually, even before Glass-Steagall was repealed which did implement firewalls to prevent the creation of what are called "weapons of mass destruction", credit default swaps and other innovative forms of derivatives were in the works.

The following is from Andrew Ross Sorkin's Too Big to Fail: the inside Story of How Wall Street and Washington fought to Save the Financial System-and Themselves:

Those financial products were created in the 1980's by people such as Howard Sosin. They have always been largely unregulated, even when Glass-Steagall was in place.

 

zzzzzzzzzzzzz

They could get a raise.

You can't county on anything. You can't count on your income not going down.

And when their income rises faster than inflation, their standard of living is improved.

But for anyone who earns more form their savings than inflation, their savings are being enhanced.

 

You are correct as to prices in general, but see the caveat. Folks who are paying fixed prices for debt like a mortgage find that the mortgage costs relatively more when their incomes decline.