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View Diary: BREAKING: Fed Launches $40-Billion-a-Month QE3 Stimulus (129 comments)

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  •  In which case we'd see widespread inflation (8+ / 0-)

    There is absolutely and completely no way to have currency driven inflation limited to a single commodity.

    One of the effects of this entire recession should be the utter and complete annihilation of Friednman and the Austrians as regards inflation.

    "Inflation is always and everywhere a monetary phenomenon" has been shown to be utter idiocy.

    Romney economics: Feed our seed corn to the fattest pigs and trust them to poop out jobs.

    by blue aardvark on Thu Sep 13, 2012 at 10:36:45 AM PDT

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    •  We do see widespread inflation! (2+ / 0-)
      Recommended by:
      marianevans, erush1345

      Food and gasoline are the big ones.

      Have you been to the grocery store lately?

      The bigger manufacturers of food and other groceries are attempting to hide the inflation by cutting quantities in packaging. But you are still seeing steadily rising prices.

      More expensive gas pushes up US wholesale prices

      A sharp rise in gasoline costs drove up wholesale prices last month by the most in more than three years. But outside energy and food, price gains were mild.

      The producer price index, which measures price changes before they reach the consumer, jumped 1.7 percent in August, the Labor Department said Thursday. The increase was mostly because gas prices soared 13.6 percent, the biggest gain in three years.

      Food prices rose 0.9 percent, driven up by steep increases in the cost of eggs and dairy products.

      •  No, we don't see widespread inflation (0+ / 0-)

        There is a reason why those are called "volatile". Because they, you know, fluctuate a lot.

        And if you think eggs and dairy have nothing to do with the massive drought and the increase in corn prices you are just silly.

        And when gas prices were falling rapidly earlier this summer while the money supply was still rising that proved what, exactly?

        You either don't understand economics or you are a troll. Either way, stop arguing with me as you are making a fool of yourself.

        Basic point: qualitative easing will not add to inflation. You produce no evidence whatsoever to contradict that point.

        Romney economics: Feed our seed corn to the fattest pigs and trust them to poop out jobs.

        by blue aardvark on Thu Sep 13, 2012 at 11:38:20 AM PDT

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        •  It will raise the price of oil (1+ / 0-)
          Recommended by:
          erush1345

          That's what I said, and that is what will happen.

          And things based on the price of oil will also likely rise in price.

          Money Week - QE favours the rich

          Oil, stocks and gold all went up yesterday in anticipation.
          The Fed prints and prices rise for the people the Fed action pretends to help. The first round of QE drove food prices up 20% and oil up 59%. Then, QE2 pushed up oil another 30%, while food rose 15%.
          •  You've said quite a bit more than oil (0+ / 0-)

            And the price of oil goes up as the economy improves because people use energy to do all those economic activities.

            So, any action which improves the economy will tend to raise the price of oil.

            Romney economics: Feed our seed corn to the fattest pigs and trust them to poop out jobs.

            by blue aardvark on Thu Sep 13, 2012 at 11:47:55 AM PDT

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    •  Absolutely right. Understanding of monetarism FTW! (4+ / 0-)

      And what makes that argument even worse is that oil and food prices are particularly prone to price swings based on events that have nothing to do with the underlying money supply, such as refinery disruptions and OPEC actions (in the case of oil) and drought (in the case of food).

      Art is the handmaid of human good.

      by joe from Lowell on Thu Sep 13, 2012 at 11:34:14 AM PDT

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      •  Or just plain vanilla supply and demand (1+ / 0-)
        Recommended by:
        joe from Lowell

        Gas prices in particular have season variations based on refinery choices of what to produce and consumer activity. They go up in the summer, down in the winter. Heating oil moves in reverse to that.

        The worst drought in 70 years and found prices are up 1%? That sounds pretty mild to me.

        Romney economics: Feed our seed corn to the fattest pigs and trust them to poop out jobs.

        by blue aardvark on Thu Sep 13, 2012 at 11:39:49 AM PDT

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        •  How about the oil price spike during 2011? (1+ / 0-)
          Recommended by:
          blue aardvark

          We were just about in a double-dip recession, but because of the Libyan revolution, prices went through the roof.

          Oil is weird.  Yet another reason to bring on the renewables.

          Art is the handmaid of human good.

          by joe from Lowell on Thu Sep 13, 2012 at 11:53:35 AM PDT

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          •  The amount of surplus supply is thin (1+ / 0-)
            Recommended by:
            joe from Lowell

            when demand is high.

            We're going to see horrible gas prices when the recession does end unless we have serious action on renewables first.

            Romney economics: Feed our seed corn to the fattest pigs and trust them to poop out jobs.

            by blue aardvark on Thu Sep 13, 2012 at 12:32:46 PM PDT

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            •  That's the scary part. (2+ / 0-)
              Recommended by:
              blue aardvark, erush1345

              These painfully high prices we've been paying for the past couple of years are happening when demand has been suppressed.

              It's a good thing big SUV sales have tanked, and fuel-efficient cars are back in style.

              Art is the handmaid of human good.

              by joe from Lowell on Thu Sep 13, 2012 at 12:45:18 PM PDT

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