It's worse than you think - Vox Popolivoxday.net/2024/05/20/its-worse-than-you-think/
733 sats \ 22 comments \ @erict875 21 May econ
What have they done to our money? šŸ˜„
Interestingly, the author blames the boomers' excessive lifestyle for the situation. This is a new perspective to me...
Inflation isnā€™t printing money, itā€™s borrowing money. Thatā€™s how the money is created. And the private economy is still, to this day, considerably larger than the public one.
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51 sats \ 6 replies \ @Undisciplined 21 May
Thatā€™s a strange sentence, because money is created in both ways. In fact, the treasury has been printing lots of physical cash lately, because the Fed is not easing up on its monetary policy.
Itā€™s certainly true that most money is created through borrowing, but thatā€™s a very poor way to make that point.
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21 sats \ 5 replies \ @Satosora 21 May
I just feel if the boomers had been better educated about money, their finances wouldnt be so poor. Imagine the innovation they could have driven if they had invested their money wisely.
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10 sats \ 4 replies \ @Undisciplined 21 May
The way Boomers manage their finances drives my wife and I nuts. Of course, we're specifically thinking about our parents.
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21 sats \ 3 replies \ @Satosora 21 May
Yes, its crazy. I feel they really stagnated after being able to improve their quality of life for a little while. No wonder they all seem to have a midlife crisis.
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20 sats \ 2 replies \ @Undisciplined 21 May
One of their generational traits was a willingness to take big chances in pursuit of their dreams.
That can really allow for rapid gains in quality of life, but it's not the best approach to personal finance.
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0 sats \ 1 reply \ @Satosora 21 May
They seemed more interested in fitting the mold instead of breaking it. Mindless workers for 40 years.
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0 sats \ 0 replies \ @didiplaywell 21 May
The description seems to be universal, applies in my country, and even to my parents. But, what we should be asking ourselves is: what caused that? what promoted such behaviour? From my perspective, what seems to promote that are stagnant societies, where things seem to not to change, so fitting is appropriate, for breaking the mold leads nowhere.
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21 sats \ 0 replies \ @Kontext 21 May
"We ain't getting paid commission, minimum wage, modern day slave conditions Got me flippin' burgers with no power Can't even buy one off what I make in an hour" ā€• Dead Prez - Hell Yeah (Pimp the System) (released in 2004)
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0 sats \ 0 replies \ @kingzing131 21 May
Consumers willing to borrow and spend is a sign of good economy, until it becomes over leveraged and implode.
And low rates that encourage borrowing, is the main causes of it. So yes it isn't really about printing money (bank reserves), but that pretty much is what most countries do nowadays, open market operations.
My biggest nightmare is that we never quite recovered from 2008, we have low rates and low growth (compared to pre 2008).
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0 sats \ 0 replies \ @Satosora 21 May
Interesting. All brought on by the boomers?
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0 sats \ 11 replies \ @didiplaywell 21 May
Two questions:
  • What do you imply exactly by "inflation is borrowing money"?
  • What's the "public economy"?
One observation:
  • No theory says that "inflation is printing money". No economist has ever said that! For instance, that's not what the monetarist theory says either. Monetarism clearly states that "inflation is caused when money is printed above the real rate of growth of the economy", which in practice is traduced in the state spending more money units than the units it receives through direct taxation.
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0 sats \ 4 replies \ @Undisciplined 21 May
The original meaning of ā€œinflationā€ was money creation, so you are not correct about that.
The entire Austrian Economics tradition still uses the term in its original meaning.
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21 sats \ 3 replies \ @didiplaywell 21 May
I didn't say that inflation isn't creating money, I said that the expression is incomplete! I vow for the Austrian principles.
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0 sats \ 2 replies \ @Undisciplined 21 May
Sorry, I misunderstood your point.
It would still be correct to say that printing money is inflation, but it's only one form of it.
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21 sats \ 1 reply \ @didiplaywell 21 May
What you mean with "one form of it"?
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20 sats \ 0 replies \ @Undisciplined 21 May
Money can be created either by directly printing it or through creation of new debt.
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0 sats \ 5 replies \ @erict875 OP 21 May
It's quoted, I don't say it, the author of the blog post does. I think it's because he sees borrowing as the primary cause of the expansion of the money supply. Public economy is a reference to the economic activities controlled by the public sector, i.e. the government.
Monetarism clearly states that "inflation is caused when money is printed above the real rate of growth of the economy", which in practice is traduced in the state spending more money units than the units it receives through direct taxation.
I think that is what the screenshot implies.
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0 sats \ 4 replies \ @didiplaywell 21 May
Ok! If you didn't we can talk about it. The article is flawlessly wrong in its entirety. But, what calls your attention about his take?
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0 sats \ 3 replies \ @erict875 OP 21 May
I know the author's very critical of the boomers, so he's for sure biased against them. But I'm interested to know why you think the article is wrong. I guess this issue could be settled by comparing the proportion of public and private economies? But is it even possible, considering how intermingled they both are?
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142 sats \ 2 replies \ @didiplaywell 21 May
To start, I hate boomers too. They created the monster, fed him and allowed him to grow unrestrained, all along being prodigiously clueless about the implications.
There is no proportion of "public" economy, there is only private economy, and public spending. Whenever public spending exceeds what the private economy provides, it means it's getting money somewhere else: the printer. That's the only place where non taxed money can physically come from, as it does. As new money enters the economy through public spending, new consumers appear for a non existent production. Pressing demand for a limited offer pushes prices up, and the rest is history.
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0 sats \ 1 reply \ @erict875 OP 21 May
Good point, thank you!
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0 sats \ 0 replies \ @didiplaywell 21 May
My pleasure :)
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