The Wall Street Journal (WSJ) joined the chorus of headlines about rising prices by recounting price inflation with the article: When Americans Took to the Street Over Inflation, warning readers:
Today, after decades of nearly invisible inflation in the U.S., many Americans have little idea what it looks like... But America’s long inflation holiday shows signs of ending…
When justifying the airing of opinion, particularly of unpopular opinion, interlocutors have often pointed to John Stuart Mill’s On Liberty for support. Mill’s classical liberal tome is regarded as one of the greatest defenses of individuality, free thought, and free speech ever written.
Policymakers know they hold immense power to regulate and punish firms that don’t play ball. Industry leaders know this too. So it’s likely both sides will indeed end up “playing ball.”
According to a relatively new field of economics called behavioral economics (BE), emotions play an important role in an individual’s decision-making process. On this the Nobel laureate Vernon Smith writes,
El Salvador became the center of the bitcoin world recently with the announcement from President Nayib Bukele that the country will embrace a bitcoin standard.
When the Trump administration pushed capping the federal tax deduction for state and local taxes (SALT), the plan was billed as a way to punish Democrats in high-tax states. But the move also increased federal revenues by as much as $100 billion. Now the Biden administration is showing little enthusiasm for undoing Trump’s cap. The cap means more federal revenues to help pay for Biden’s infrastructure plan.
Since the 1980s, slower economic growth in the industrial countries has been accompanied by declining interest rates. They have even turned negative in more recent years. At the same time, investment, productivity, and real GDP growth all have slowed. Recession caused by lockdowns of the economy to fight the corona pandemic in 2020/21 has accelerated the demise of interest. Even as the world economy recovers, central bankers around the world have signaled that interest rates will be kept low for a long time to come. What is going on here?
Many episodes of monetary inflation, some even long and virulent, do not feature a denouement in a sustained high CPI inflation over many years. Instead, these episodes have the common characteristics of asset inflation and the monetary authority levying tax in various forms – principally inflation tax or monetary repression tax. For the monetary inflation to undergo combustion into sustained high CPI inflation it must generate necessary one or two necessary conditions.
President Trump’s protectionist trade measures against China and other external partners have not caused a reduction of the total US trade deficit. The latter actually grew further as China’s exports found indirect ways into the US and massive domestic spending schemes were expanded during the pandemic.
