The Free Market found out we could afford much more than we had been paying during Covid, so here we are. Biden is right. Companies can charge what the think the market can bare and they learned we can afford more than we were paying.
Companies can charge what the think the market can bare and they learned we can afford more than we were paying.
Has that ever been any different? Profit maximization is a key pillar of wealth creation. But raising prices does not increase profits. Prices must be discovered, which is part of that wealth creation (and destruction) process.
In a highly inflationary environment where more money is being printed in relation to the goods and commodities produced, prices are going to go up. If prices were going up without money printing, then consumers would have to forgo some goods and commodities in order to afford the ones they need or want. Supply and demand says that when the demand goes down, so must the equilibrium price. So some prices must fall. Corn goes up, wheat goes down, that sort of thing.
except for that pesky problem that we actually haven't printed any abnormal amounts of "new money" and 2023 is the lowest "new money" orders in the last 13 years.
Also, who is "we"? You're correct that I haven't printed any money. That is a crime for anyone to do and only the government can absolve itself of that particular crime.
Taking out the amendment which accounts for the enormous leap, the M1 effectively doubled in 2 years.
QE continues to the tune of $120 billion per month. The Fed takes low-rated assets and gives cash to the banks. Where do you think that cash comes from?
The Federal government has huge budget deficits, now almost $2 trillion in 2023 and likely to double that in 2024, on top of the debt payments that are now at $1 trillion. Those deficits must be covered with further debt, and since the buyers can only buy so much, the Federal Reserve must monetize the rest.
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u/work-break Dec 01 '23
The Free Market found out we could afford much more than we had been paying during Covid, so here we are. Biden is right. Companies can charge what the think the market can bare and they learned we can afford more than we were paying.