20 sats \ 3 replies \ @Undisciplined 5 Oct \ parent \ on: The Daily Zap — Latest News and Updates alter_native
It is interesting that economic growth is slowing down, but almost everything the author said about it made no sense and just seemed like they were trying to jam their political agenda into a bunch of facts that don't fit it.
It's the best we can expect from Indian media. However, I wanna know your reaction on the following.
It is only the US that has the capacity to autonomously lower its interest rates to whatever it considers appropriate for stimulating aggregate demand (which would then allow other countries too to lower their interest rates). But the interest rates in the US for much of the recent period were close to zero and still there was no revival of the world economy. On the contrary, such low interest rates maintained over a long period had the effect of emboldening corporates in that country to raise their profit mark-ups and give rise to an acceleration of inflation, as has occurred of late.
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I agree with the last part. ZIRP was definitely inflationary.
I'd need to see someone actually make the case that it led to higher mark-ups. If anything, I'd expect the opposite (although I don't think "profit mark-ups" is the right way to think about it), because in higher interest rate environments a business could always just earn passive income rather than spend on marginally productive things.
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Thanks 😊 I got it. The first part is definitely a nonsense. How can US or if we combine all other bigger economies together, still none can dictate things for market how they wish.
I won't include Indian Media output in 'The Daily Zap' until I see it covered elsewhere.
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