Didn’t the hawks say they wanted to focus like a laser on inflation?
Saturos sent me the following:
STOCKHOLM, Nov 5 (Reuters) – A majority of Swedish rate-setters now firmly believe that high household debt levels must be considered when setting policy, a central bank source said, a shift that could cap rate cuts if debt starts growing.
Sweden’s economy is slowing as the turmoil in the neighbouring euro zone hits the exports of its leading firms, prompting markets to bet that the Riksbank will soon loosen monetary policy to underpin growth.
However, Swedes have among the highest borrowing levels in Europe and though worries of a housing bubble have subsided and borrowing growth rates have fallen, credit expansion is still strong. This seems to have put some policymakers off cutting rates.
The four most hawkish members of the six member executive board now think it is time to remove doubts that high levels of consumer debt and debt sustainability are factors in setting interest rates.
“It is only now that the majority (of the board) is clear that it puts an explicit emphasis on indebtedness and that it affects the assessment of the balance of inflation and resource utilization,” the source told Reuters.
The move, which has been brewing for some time, comes after criticism of board members for being unclear about whether they have other targets than the official one of an inflation goal of 2 percent over a 2-year horizon.
The source noted a hardening in the stance on household debt had been seen in late October in Central Bank Governor Stefan Ingves’ newspaper opinion piece, which surprised markets as it came just a week before a rate-setting meeting that had been seen as being in the balance.
The source also mentioned a speech by Deputy Governor Per Jansson, where he said household debt had to be taken into account, even if it was difficult exactly to quantify the impact of monetary policy measures on such borrowings.
. . .
In the last few years, the question about whether household lending should be taken into account when setting rates has been hotly debated within the board.
The more hawkish majority – currently Ingves, Jansson as well as Barbro Wickman-Parak and Kerstin af Jochnick – has referred to household debt occasionally as a reason to keep rates higher.
The most dovish member of the board, Deputy Governor Lars Svensson, has argued the repo rate is the wrong tool if debt is to be kept down.
So I get it. Only wimps favor straying from a rigid inflation target to save jobs. But the central bank has a duty of overrule the regulatory policies toward debt formation of popularly elected center-right governments, when they don’t happen to like them. Even when it means ignoring their inflation target. Why am I not surprised?
PS. I will attempt to be first to call the election tonight. I’ll probably fail, but if I can find a network with a non-idiot like Stu Rothenberg, I’ll let you know as soon as the numbers make it clear who will win. Of course by then Intrade will likely know–but it can be hard to access on election night.
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6. November 2012 at 06:55
“Why am I not surprised?”
Because you have grown accustomed to the politicization of the economics profession. Simply take a look at John Taylor and Greg Mankiw.
Wanna bet that if Romney were running for re-election, they might not be coming out so hard against Fed action?
Economists, like other human beings they study, also respond to incentives.
6. November 2012 at 07:20
Ritwik suggests a blunter instrument: the IOR rate. Here’s our discussion on Twitter, if anyone’s interested: https://twitter.com/_Srijit/status/265816361241042944
https://twitter.com/_Srijit/status/265829662037528576
6. November 2012 at 07:20
And here: https://twitter.com/_Srijit/status/265831611524845568
(circumventing auto-block there)
6. November 2012 at 07:22
(Obviously repo-rate blunter than IOR, IOR blunter than specific regulation.)
6. November 2012 at 07:23
The situation in Canada is quite similar. The Bank of Canada is under pressure not to lower its benchmark rate under 1%, so to reign in household debt, which has grown much thanks to regulation implemented in 2006 by a center-right government. Meanwhile, inflation has been much lower than 2 % for the last 7 months and we do not have full employment.
6. November 2012 at 08:10
Statsguy, But in Sweden the current government is center-right, so it must be more complicated. I don’t see it as a partisan issue, rather an ideological aversion to debt.
6. November 2012 at 08:19
No news here. Central Banks were always political. The best evidence is Alesina-Ardagna paper that (since we are smart an know about Sumner critique) just confirms that CB are more inclined to accommodate fiscal austerity compared to fiscal stimuli. Or to put it in the other way, CBs casually use tighten aggregate demand to punish governments that enacts supply side policies central bankers don’t like. So much for political independence.
The only difference is that while in the past they were comfortably outside of public scrutiny now there are people requesting that they provide actual explanation for their actions.
6. November 2012 at 08:20
So if household debt starts falling, is that a reason for more expansionary monetary policy?
Or is this just a convenient justification for contraction?
6. November 2012 at 09:25
I think we’ll know pretty early tonight who is going to win. If Florida doesn’t get called for Romney right away, he’s got a problem. If Pennsylvania similarly doesn’t go Obama early, he’s got the problem.
6. November 2012 at 10:29
Scott, it is becoming increasingly clear that Riksbanken is suffering from “dangerous bubble fears”. I have a post on that topic here: http://marketmonetarist.com/2012/10/22/dangerous-bubble-fears/
I my post I conclude as you that Riksbanken cannot have more than one target – inflation targeting – but it is nonetheless trying.
6. November 2012 at 10:31
I’m confused.
If they want to ease debt burdens and discourage borrowing, shouldn’t they be loosening monetary policy? It seems to me this would cause nominal incomes to rise and existing debts to devalue. And as inflation expectations rise, so would nominal interest rates, which should cause people to borrow less (because of money illusion).
What am I not getting?
6. November 2012 at 11:37
Money is credit. If credit is growing ==> money supply is growing ==> AD is growing ==> NDGP is growing. Is it growing “fast enough”? Not enough information here.
But, central banks should definately be keeping an eye on the rate of credit growth when setting policy.
6. November 2012 at 12:03
Statsguy, a Romney win that puts Greg Mankiw at the Fed may be the final step in ushering in a NGDP target. http://macromarketmusings.blogspot.com/2012/11/if-mitt-romney-becomes-next-president.html
6. November 2012 at 12:04
Aversion to debt is to be interpreted as “ideological.”
Aversion to declining NGDP is not to be interpreted as “ideological.”
Yet both are relating to or concerned with ideas.
Why am I not surprised?
Maybe someone is just peeved that the Riksbank is daring to be influenced by anything other than market monetarism (which of course ignores credit expansion, no matter how high it gets relative to monetary base, and thus no matter how fragile and prone to crises the financial system becomes).
The morons.
6. November 2012 at 12:48
“I will attempt to be first to call the election tonight.”
As an EMH guy does that mean you will scroll numbers off of intrade?
Obama 70, Obama 70, now Obama 71, Ohio polls closed, Obama 72!
6. November 2012 at 12:52
Doug M:
You said money is credit. Actually that is not correct. Dollar bills are money, but they are not credit.
What is correct to say is that credit is money.
6. November 2012 at 14:12
Scott says… “If the libertarians ever start stealing 5% or 10% of the votes from one of the two major parties (or both) you can be sure that next time they’ll shift their position closer to the libertarian direction. ”
The problem for a party moving toward the libertarian’s positions is that it could end up losing them MORE votes on the other end of the spectrum.
Part of the diastase Americans have for the T-folk, and by extension many in the GOP, is their libertarian leaning.
Libertarians tend to underestimate how repugnant their positions are to many people. And it is not because people have misconceptions that will evaporate once the day comes when libertarians get to educate them.
Why does every movement out of power have that same illusion…
” If only other people knew what I know…If only they shared my knowledge… If only…we can have a much better world !”
Anywhere on the spectrum… they all think the same thing. Some things are fundamental about people.
People fundamentally won’t agree. People fundamentally feel entitled.
People will warp any system to gain and hold power. Then what is it ?
What is moderate Libertarianism ?
Maybe I am a moderate Libertarian ? Maybe Krugman ?
I am all for free market solutions when they are practicable. Isn’t everyone ?
6. November 2012 at 14:17
Oops… That rant above sounds slightly less crazy on the “don’t waste your vote” thread.
My bad.
6. November 2012 at 15:42
Patrick, I’m not so sure. Drudge says the exit polls are tight. He leans toward the GOP, but it’s an interesting report. In 2004 the exit polls had a sampling bias that tilted Democratic. Early in the evening it looked like Kerry would win. Don’t know why that happened or if it would happen again. Perhaps white Republicans are reluctant to talk to black or hispanic exit poll takers. I still lean toward the view that Obama will win, but my hunch is that the popular vote will be close to even.
Steve, Yes, but it’s no fun if you just use the EMH on election night.
6. November 2012 at 15:45
Lars, That’s a good post.
6. November 2012 at 15:51
I have this scenario built up in my head that after Svensson proved most of the rest of the Riksbank wrong, by opposing much of the 2011 tightening, that now his colleagues are doubling down, opposing all his ideas. One wonders what they will do in early 2013 when inflation is down -0.5% y/y and the country is still indebted.
If the Riksbank is so worried about debt levels, perhaps they should fund a study looking into the role that Sweden’s rent control policies play in promoting debt. One literally cannot enter into a longterm lease in the big 3 Swedish cities, not without 10+ years on a waiting list. Might this prompt young people to take on mortgages before they otherwise might?
6. November 2012 at 16:06
Virginia tends to get its votes counted early. Before Florida and Pennsylvania.
If Virginia goes Obama it is over.
If Virginia takes a long time because it it close, and ends up going either way… it tells us Obama will win anyway but with a small electoral margin.
If Virginia shows strong for Mitt it… it still will come down to Ohio.
6. November 2012 at 17:28
@David Beckworth
I agree with you that Mankiw is more or less a Friedman-style monetarist, and I agree with your conclusion that he will likely support NGDP targeting… _after_ Romney is elected.
6. November 2012 at 23:02
To ask an admittedly unrelated question, if you have the choice hypothetically between an 8% unemployment rate and a 2% inflation rate or the opposite-2% unemployment and 8% inflation which do you choose?
7. November 2012 at 09:16
To ask an admittedly unrelated question, if you have the choice hypothetically between an 8% unemployment rate and a 2% inflation rate or the opposite-2% unemployment and 8% inflation which do you choose?
Depends on whether one benefits or is harmed from inflation, and depends on whether one is or is not a member of the unemployment percentage.
8. November 2012 at 06:37
Of course some benefit and some don’t. How about on the larger macro.level
?
8. November 2012 at 07:16
No, I mean for the person answering that question, they would take into account their own circumstances, and would care if there are a part of the 8% unemployment or 2% unemployment, and they would care if they are harmed by inflation such that they would be harmed more with 8% inflation than with 2% inflation.
When you say “how about on the larger macro level”, you are basically telling me I should not consider individual people as ends in themselves, but to go to church, pretend I am God, and pretend to conceive of a single “yay” or “nay” statistic that can describe hundreds of millions of people’s separate lives.
If I am going to be worse off with A, then I would choose B. If I am going to be worse off with B, then I would choose A.
Why the hell would I choose the one that harms me more? I have a life and a family to feed.
8. November 2012 at 08:11
George, you don’t care what happens to people in aggregate? Or just not as much as yourself? Suppose you could sacrifice your life to save a whole country from being hit by an asteroid…
8. November 2012 at 08:26
Saturos, I don’t know what you mean by people “in the aggregate.” Again, all I see are individuals. If I had to choose between you losing your job and your house, or me losing my job and my house, sorry, but I would choose saving my job and house.
Yes, I do care about others, just not as much as myself. I don’t think that’s wrong. If I really did care more about others than I did myself, then I would be obligated to kill myself and donate my organs to save the lives of others.
The fact that you are not killing yourself tells me that you also care about yourself by MORE than you care about others. I won’t condemn you. It is reasonable, justifiable, and proper for how humans should act.
To answer your question about the asteroid, I would not sacrifice my life to save the whole country from being hit with an asteroid. For that would be an ethic that puts me right back to caring about others MORE than I care about myself, which would require me to kill myself right now to save the lives of others.
You may not like that answer. You may dislike me intensely for choosing to save myself rather than you, your family, your friends, and so on, and I would fully understand it if you did dislike me. But your liking or disliking of me is something that is, quite frankly, ranked even lower than the care I feel for other humans.
I would rather live and you not being there to say nice things about me at my funeral, than die and you being there to say nice things about me at my funeral. What good are your words if I’m dead?
I don’t mean to be offensive, or a jerk, I’m just saying what I actually think. You may disagree and want nothing to do with me, but that’s fine with me, because heck, I’m alive and happy! It’s a wonderful “gift”, opportunity, to be alive. It is what I value the most out of anything in the entire universe.
I think about how dirt and inorganic matter was just lying there for billions of years, and through some incredible processes, that dirt and matter was transformed into me, who can think, breathe, laugh, be happy, and experience the world from a perspective that no rock or tree could ever experience.
Maybe I am just so thankful for being alive that I find it incredibly depressing that anyone would even think of sacrificing themselves for the sake of things outside themselves.
OK, sure, maybe if I was in so much pain and torture that I would consider offing myself, but I am not feeling that much pain or torture. I am feeling joy and happiness, and I won’t let that go willingly.
8. November 2012 at 09:20
If I really did care more about others than I did myself, then I would be obligated to kill myself and donate my organs to save the lives of others.
George, I didn’t say you always had to put other people’s interests ahead of yours. But you seem to approve of always putting your own interests ahead of others. That… seems wrong to me.
I probably wouldn’t kill myself just to donate my organs. Even from a utilitarian point of view, there are better uses of my time…
I’m sorry to hear that you would be prepared to take my job and my house from me, if you lost yours. For what it’s worth I hope I would never do the same to you. In fact if there were some way of acting right now to remove the possibility of my future self doing such a thing, I would.
Surely you must care about some individuals other than yourself, or your own family? Surely you would sometimes put the interests of others ahead of your own?
So if unemployment rose to 8%, isn’t that worse than inflation rising to 8%? Economists would say so. Because if necessary the slight loss of capital income could be compensated by those people who retained their jobs. And everyone would be better off, relative to the alternative.
Even if not, though, wouldn’t you rather the inflation (with slight losses to capital income – certainly not on the order of 6%) than the unemployment?
8. November 2012 at 13:42
Saturos, I am sorry for conveying the impression that I had accused you of saying that either myself or you or another had to always put other people’s interests ahead of mine. That is not what I intended.
I will emphasize however that I do approve of someone, either you or anyone else, of always putting their interests ahead of others. It is not my belief that someone else, at any time, should ever put my interests above their own, for any reason. I think that would be presumptuous and unwarranted, insulting even. I respect myself too much to dump on someone else like that.
However, if they find it is in their own interests to improve my life in some way, because I am valued too much by them, then I would be as equally respectful of their choice as compared to if they never gave me the time of day for the sake of their own interests.
You say that you think “it’s just wrong” that someone would think that it is justified to always put their interests ahead of others. While I will not presume myself to be knowledgeable of your circumstances and convictions, I will say that in my experience people who find offense to it, oftentimes feel offense…for self-interested reasons. They see someone who is willing to put their own interests ahead of others, including the person who ponders such an ethic and considers it offensive, and the offended person would feel threatened in some way, because maybe, if the situation arises, their mortal life would be not cared for by the selfish person, because the selfish person always puts his own interests ahead of others. So maybe whilst the offended person is drowning, they imagine the selfish person to think that because laughing at the event may give him more joy than helping the unfortunate person, then the offended person’s life would end for the sake of someone else’s laughter.
But that to me is just low self-esteem. It requires low self-esteem to believe that one’s own life would be threatened if everyone else were always self-interested, because it implies that the value one represents to others is so low, that nobody would care about them. The offended person believes that the only way to get others to value them, is to give something for nothing, i.e. to be altruistic. Thus they cannot even comprehend how someone else would help the offended person for selfish reasons.
You said that you probably wouldn’t kill yourself just to give your organs to save others. Let’s be more clear. You ARE NOT killing yourself just to give away your organs. I am somewhat relieved that you said you are more valuable to others than merely being a warehouse of body parts. But please don’t offend my intelligence by insinuating that you are doing so for “utilitarian” considerations. Pshaw. A real utilitarian would say that because your death would give life to 3 or 4 people, that you deserve to die. It’s OK, you can tell me you want to live because you value your life too much. I would respect that a lot more than prattling on about ethical nomenclature.
For the job and house choice scenario, I am sorry if I conveyed the impression that I would TAKE your job and your house. What I meant was that if I had a choice between you keeping your job and house, versus me keeping my job and my house, then I would choose keeping my job and house, period. If something else should be the proximate cause for your loss, and I had to choose between saving you or saving me, then I just wanted to say I would save me, and I wouldn’t be embarrassed or ashamed to do so. Can you imagine what I would have to tell my family if I came home one day and said “I chose to save the job and house of Saturos, and because of that choice, I had to sacrifice you and I, and so we longer have a house and I no longer have a job”?
I just don’t value you that much, no offense.
You said that for what it’s worth, you hope you wouldn’t make the same choice. I love love love the weasel word “hope”, because that to me means “I would make the same choice as you, I just don’t want to be blunt about it, so I will say I “hope” I never find myself in that position where I will make the choice to save my job and house rather than yours. Of course, if I do in fact find myself in that position, then sorry, but you are going to be secondary. Deal with it.”
You then said “if there was a way”, you would act in such a way now that you won’t have to make that choice. This is, quite frankly, merely posturing. It would be like someone who is going to save himself and not someone else from death “If I were God, I would save us both. But I’m not, so sorry, but you’re going to die.” It is just sugar coating a harsh reality to make it seem like you’re not self-interested. That sugar was piled on top of you by moral parasitism in most of this age’s discourse, literature, art, and academia. Excuse me for using the blunt term parasitism, but that is what I understand selfish people to be when they try to make others altruist.
To answer one of your questions, yes, I do care of others besides myself. But I do not care for others MORE than myself. I care very deeply for both my children, but I do not care for them equally, nor do I care for them more than myself. I will be incredibly blunt with you and say that if ever the situation arises, I would choose to save a particular child over another, and if I had to choose between them and me, I would choose me. Now, you may find yourself even more abhorred with me. You may be even more offended. But not even children will get me to value my life any less than the top value. I wouldn’t want my children to be raised by some degenerate who has such low self-esteem that he would die if it meant to save others. I would not respect it if my parents chose me over themselves. I respect them more if they value their lives so much that they would choose themselves over me. I am not threatened by that, any more than I am not threatened going out at night knowing that there may be someone who values his selfish joy so much that he would rather shoot me dead than contain his joy for my sake.
I never put other people’s interests ahead of my own. I value others for selfish reasons. You may believe my actions would even be altruistic at face value. I protect and feed and nurture my children for purely selfish reasons. They make me incredibly happy. When they are better off, I have a better life. But if it came down to life or death, I would choose their death and my life. Call me morally repugnant or evil if you want, but I am an excellent parent.
If unemployment rose to 8%, I would only care if I were one of them, or someone I cared about. I wouldn’t feel bad or get down on myself if some statistic changed and nobody in my life were part of that statistic. Economists who say 8% unemployment is worse than 8% inflation are not making an economics statement. They are making a value judgment, probably couched in some mathematical gobbledygook pretending to be wertfrei.
You claimed everyone would be better off with 8% inflation as opposed to 8% inflation. Well, that is a false claim. You can’t possibly know what’s best for millions of other people, many of whom you haven’t even met. How arrogant. How hubristic.
I don’t want to talk to you anymore. Ciao.
8. November 2012 at 13:42
Sorry, typo. I meant “8% inflation as opposed to 8% unemployment.”
8. November 2012 at 20:10
The person answering the question is a macroeconomist.
8. November 2012 at 21:28
I wonder how George’s wife (if he still has one) feels about his views…
8. November 2012 at 21:31
My future self is a different person, so I can’t completely speak for him. But he owes his life to me, so I feel no qualms about restraining his liberty.
10. November 2012 at 13:51
George I can’t quite put my finger on it but somehow you sound familiar…
I don’t think that anyone would simply randomly sacrifice themsevles for just anyone else at the drop of a hat at any time.
Still, most people probably have someone they would sacrifice themselves for. If there is no one you feel that way about George while it’s your business I can’t say you sound like much of a person. It doesn’t have to be a concern of yours that i say it anyomre than anything you say has to be a concern of mine. That’s just my take on it. It matters to me which is enough.
I mean I don’t have a wife or kids but I’d like to think if I did I would sacrifice myself in any way for them.
And some do sacrifice themselves for strangers-like firemen.
In reality, though, this is far a filed from my question which was an economic one.
While some many gain or lose from a particular policy, some policies benefit the larger economy-most people, some don’t.
My question was from the point of view of a social planner what might be the prefferable situation.
If you are claiming it’s impossible to speak of aggreages does that mean it’s impossible to speak of the Great Depression or any depression at all?
Was the GD just another time when there were some who benefitted from the economoy and some didn’t?
Again, my question is what’s preferrable-high inlfation or high unemployment?
12. November 2012 at 02:08
Mike Sax…
“The person answering the question is a macroeconomist.”
Insufficient information. It is important whether this macroeconomist benefits or is harmed on net by inflation, and whether or not he is or is not a part of the 8% unemployed.
Saturos…
“I wonder how George’s wife (if he still has one) feels about his views…”
She has the same views as I do.
“My future self is a different person, so I can’t completely speak for him. But he owes his life to me, so I feel no qualms about restraining his liberty.”
You can’t restrain a non-existent person.
Mike Sax…
“George I can’t quite put my finger on it but somehow you sound familiar…”
Let me guess…Randroid?
“I don’t think that anyone would simply randomly sacrifice themsevles for just anyone else at the drop of a hat at any time.”
Neither do I. But that is what is implied by the morality of putting other’s interests ahead of one’s own.
“Still, most people probably have someone they would sacrifice themselves for. If there is no one you feel that way about George while it’s your business I can’t say you sound like much of a person. It doesn’t have to be a concern of yours that i say it anyomre than anything you say has to be a concern of mine. That’s just my take on it. It matters to me which is enough.”
What do you mean I don’t sound like a person? I am a person, agreed? If I am a person, then I necessarily sound like a person.
I fully respect your take that what I say need not be a concern of yours. To this extent however, you are not putting my interests (“other’s” from your perspective) above your own. You are being selfish in my presence. Again, I am not condemning you for that, it’s just what you are doing.
“I mean I don’t have a wife or kids but I’d like to think if I did I would sacrifice myself in any way for them.”
That’s your choice. I respect that. I trust that you respect mine.
“And some do sacrifice themselves for strangers-like firemen.”
I didn’t ask them to do that. I owe them nothing. If they expect something in return, they should have asked.
“While some many gain or lose from a particular policy, some policies benefit the larger economy-most people, some don’t.”
I don’t understand what you mean by “the larger economy”. There is nothing “larger” than what is, and what is consists of you, me, my friends and your friends, our families, and their friends, etc. To me that’s all there is. Millions and millions of individual people. If a policy harms some people and benefits other people, then….that’s it. That’s all we can say. Some are harmed and some are benefited. There is no “larger” dimension which gains or loses in the singular sense. That’s dogma.
“My question was from the point of view of a social planner what might be the prefferable situation.”
Why on Earth does a social planner’s perspective take precedence over mine, when it comes to my own life?
“If you are claiming it’s impossible to speak of aggreages does that mean it’s impossible to speak of the Great Depression or any depression at all?”
Define depressions, and we’ll go from there.
“Was the GD just another time when there were some who benefitted from the economoy and some didn’t?”
Technically yes, but the GD was a time when quite a large number of individuals incurred losses. That is what distinguished it from prior and subsequent periods.
“Again, my question is what’s preferrable-high inlfation or high unemployment?”
Again, it depends on who you are asking. It depends on whether the person answering the question is harmed or benefited by inflation, and whether they are a part of the 8% unemployed percentage or not.
I am not a central planner, so it makes no sense to ask me to answer you as if I were. I do not want to impose my values on other people’s lives when they don’t want it. I want others to live their own lives and make their own choices.
12. November 2012 at 02:16
Hey George, have you ever met this guy called Major_Freedom…
12. November 2012 at 02:18
Mike, he prefers high unemployment, as he is selfish and he thinks it’s less likely to affect him.
And he’s wrong, of course. People think unemployment only hurts the unemployed, while inflation hurts everybody. But the reverse is closer to the truth.
12. November 2012 at 02:41
Saturos…
“Hey George, have you ever met this guy called Major_Freedom…”
I’ve seen his comments. Never met him.
“Mike, he prefers high unemployment, as he is selfish and he thinks it’s less likely to affect him.”
I actually prefer whichever option incurs me with the fewest costs. That may be with 8% unemployment, and it may be with 8% inflation. It depends on my investments, my career, etc.
“And he’s wrong, of course. People think unemployment only hurts the unemployed, while inflation hurts everybody. But the reverse is closer to the truth.”
I didn’t say that. I said it depends on the person. Inflation benefits some and hurts others, and when unemployment rises, only some people go unemployed while others do not. A person can gain more from lower inflation and higher unemployment. These people exist. I know they are so easily sacrificed in your “sacrifice is good” ethic, but it seems that me, the selfish one, cares more about the individual than you do.
Would you kill a person to save the lives of 5 people? If not, why do you think it’s justified to harm one person via inflation if it means 5 people getting a job? If you accept the latter, than shouldn’t you accept the former if you’re consistent?
Or is sacrifice only justified according to as of yet unstated reasons that you keep to yourself?
12. November 2012 at 03:07
George, don’t talk to me like that. You have no idea what my beliefs are, beyond the fact that I disagree with you.
“It depends on my investments, my career, etc.”
It depends on more than that. That was the fallacy which amused me.
And inflation doesn’t harm people, excess nominal income growth does. I don’t support that.
12. November 2012 at 03:30
Saturos…
“George, don’t talk to me like that. You have no idea what my beliefs are, beyond the fact that I disagree with you.”
Oh come on. I have a pretty good idea of what your beliefs are, considering the statements you have made in response to my beliefs! You have made your position pretty clear.
“It depends on more than that.”
It actually doesn’t depend on anything more than my own interests.
“That was the fallacy which amused me.”
How is it a fallacy?
“And inflation doesn’t harm people, excess nominal income growth does. I don’t support that.”
What you call “excess nominal income growth”, that is financed by inflation. I don’t see how you can abstract the latter away from the former.
Inflation does harm those people who experience inflation as higher than otherwise prices (costs), relative to their nominal incomes. This is the case even if price indexes fall from one period of time to the next. The costs of certain individuals are still higher than they otherwise would have been.
Inflation also harms people who simply do not want to trade in dollars at all, but are coerced into doing so anyway because they owe taxes in said dollars, even if they don’t even earn dollars!