Anonymous at Mon, 10 Jun 2024 19:35:36 UTC No. 16227271

both

Anonymous at Mon, 10 Jun 2024 19:40:00 UTC No. 16227273

>>16227267
Both, it also means people are likely to invest into bonds instead of competing over real assets.

L acórn at Mon, 10 Jun 2024 21:12:42 UTC No. 16227442

>>16227267
>Economics
The greatest secret is that nobody really knows or understands, but the self fulfilling prophecy of half baked theory combined with public trust is what the Fed relies on to manipulate the economy, and is more powerful and predictive of the economy than any theory. Congrats, I just saved you 8 years of study.

Anonymous at Mon, 10 Jun 2024 21:16:15 UTC No. 16227448

it doesn't make inherent sense because it's a jewish perversion of the monetary system meant to benefit a very small and select group of people

Anonymous at Mon, 10 Jun 2024 21:29:54 UTC No. 16227465

>>16227267
>economics is science
economics is sociology. read their fucking papers. 50% of them looks like some shitty psychology crap. also, reminder that the fake and gay gender wage gap research came from a loser feminist economist who was just award the nobel prize in economic last year.

Anonymous at Mon, 10 Jun 2024 21:39:33 UTC No. 16227472

>>16227267
Look at it through supply & demand

Interest rises

People want to save more to earn more interest
People save more so spend less
Less spending means less demand for goods
Less demand for goods means lower prices
Lower inflation

Higher interest means more expensive loans
Which means less loans taken
Less loans means less investment in economy
Less investment means less growth, less demand for capital goods

Anonymous at Mon, 10 Jun 2024 21:54:24 UTC No. 16227500

>>16227267
It is a fundamental attribution error to say that interest rates are correlated with inflation.
Raising interest rates does not reduce inflation but alters the disbursement of it, the quality of inflation because loans themselves are creating money supply with what is known as the money multiplier effect. Inflation is a murky concept that at many layers is flawed by junk data in and junk data out. The CPI has a fluctuating basket of goods that is never disclosed. This is obtuse as it is opaque. Comparing 1999 dollars to 2001 dollars gives you a currency denomination level understanding but even then we are still papered over at the same layer of claims. Americans have unpayable debt for basic medical services, higher education, home and vehicle ownership BY DESIGN. Banks have NO OBLIGATION to keep reserves but operate on the assumption that everyone one will not withdraw at the same time. The fundamental rules of lending have changed in a way that was impossible during precious metal backing. You will be indefinitely amoritized with refinancing options for a shadowy group of creditors who trade with other creditors. When you investigate credit card disputes with banks and credit repair agencies you will, like Michael Burry did in 2008, be the only interested observer of truth. Higher interest rates essentially mean usury which does not combat the weakening of purchasing power as a fundamental currency value but combats the decentralizing of purchasing power outside of solvently credited and crediting institutions.

Anonymous at Mon, 10 Jun 2024 22:05:33 UTC No. 16227515

>>16227267
raising interest rates = people are wary of spending money
less people spending money = less demands for goods/services
less demands = price goes down to sell inventory or you stop producing to keep the price same or you stock up your inventory and hope the demand comes back up (old inventory gets fucked if the interest rate stays high)
if price goes down, then you reduce the inflation
if price stays same, due to stoppage or stockings of excess, then inflation stays the same, this causes stagflation (where economy (things arent produced) doesnt grow but prices stay high)
if prices go up, then we are fucked because its getting to worse level of stagflation

Anonymous at Mon, 10 Jun 2024 22:06:58 UTC No. 16227518

>>16227267
Raising interest causes fewer loans, so you create less money.
It's a dumb way to stop inflation since it has a direct effect on old loans. Obviously those are unrelated to a current inflation, caused by new loans.
A more direct way to stop inflation, without unrelated effects is to raise the criteria for loans, impose limits on loans and so on.
Normal people and boomers do not understand this, they think it is good to raise the interest rates to stop inflation because everyone told them so.

Anonymous at Mon, 10 Jun 2024 22:09:36 UTC No. 16227521

>>16227465
Marginal cost is calculus
Financial instruments and variations of natural log expressions.
Since you know the adage "the only constant is change" then you would appreciate how Euler's number relates to financial securities.
This modeling has created the infinite growth models by which lending institutions always assume optimistically that the economy will continue to grow. If they would ever assume that number not go up, then they would have to dish out their RESERVES. Those who question the corporate narrative are checking account CHUDS in a world full of gibs and monstrous credit card debt

Anonymous at Mon, 10 Jun 2024 22:10:23 UTC No. 16227522

>>16227518
>raise the criteria for loans, impose limits on loans and so on
raising interest rate do exactly this. banks do tighten financing condition whenever the federal rate is raised to a certain level because they anticipate more delinquencies.
also, in this economy, there is no way to kill inflation without a recession.

Anonymous at Mon, 10 Jun 2024 22:10:37 UTC No. 16227523

>>16227518
>they think it is good to raise the interest rates
We should just instead lobby to raise Shlomo's salary and give him the blowjob gift card

Anonymous at Mon, 10 Jun 2024 22:13:00 UTC No. 16227530

>>16227522
>there is no way to kill inflation without a recession.
This is justice. Recessions are deflationary because they restore purchasing power despite dwindling accounts. The trick then is money velocity maintaing afloat. The decrepit landscape would stagflate in the absence of money changing hands over real life redrawing of property at a massive housing level.

Anonymous at Mon, 10 Jun 2024 22:14:44 UTC No. 16227534

the most retarded shit about all of this inflation stuff is that the federal reserves keep raising rate to create a recession but it never come because the biden administration keep pumping out debt relief and create fake government jobs and fake part time jobs negating the effect of the interest rate hike. also, janet yellen wants the democrats to win next election so she keep issuing more bonds and bills to fund the biden government. free money keep coming into the economy at record pace, even higher than trumptard even tho the faggot trump had to do two free stimulus check because of covid. net result is that everyone is in a purgatory not a recession but not a good economy either. everything is on life support until after the next election.

Anonymous at Mon, 10 Jun 2024 22:19:46 UTC No. 16227543

>>16227448
it doesn't have make "inherent sense" because there's nothing inherent about this system at all. it makes sense internally because we are dealing with central banks, fiduciary money, government expenditure and regulated banking.
>>16227465
economics is the sociology of scarcity and incentives. econometry is a method for dealing with this sociology. nothing mindblowing about it and there's nothing wrong with the fact that economics is it's own discipline. you could say that physics, chemistry and biology are just natural sciences.

Anonymous at Mon, 10 Jun 2024 22:21:09 UTC No. 16227546

>>16227522
>raising interest rate do exactly this
No because this belief is what precisely caused 2008 crash. ARM Mortgages were lent to the scummiest lowest scoring borrowers. Glass Steagal, SOX, Dodd Frank, et al did not address the issue but danced around it adding more bells and whistles to the issue. Banks can still issue loans with no sound lending criteria haphazardly. With IQ tests and college degrees being spurned, the banks are as interested in repaid loans as streaming services are interested in watched content.

Anonymous at Mon, 10 Jun 2024 22:22:29 UTC No. 16227550

>>16227534
>negating the effect of the interest rate hike
yep. funnily enough, that's a common problem in turd world countries.
a proper recessive adjustment would have solved that inflation (which is fine, btw). it's just that democratic leaders avoid recessions.

Anonymous at Mon, 10 Jun 2024 22:23:32 UTC No. 16227552

>>16227546
in 2008 they were giving out free loan left and right until it was already too late. I invested in a couple of microcap companies and in this cycle, some of them were issuing debt at 12%+ interest rate while 2 years ago they were doing 5-8% just fine. banks have already tightened lending condition, just not strict enough for more companies to go bankrupt yet.

Anonymous at Mon, 10 Jun 2024 22:26:07 UTC No. 16227555

>>16227518
>is to raise the criteria for loans, impose limits on loans and so on.
lacks flexibility and doesn't create an incentive for saving. i can guarantee you that central bankers thought about this.
you can avoid a direct effect on old loans by negotiating fixed interest contracts. hell, you could even regulate this and make only fixed interest contracts available.

Anonymous at Mon, 10 Jun 2024 22:27:31 UTC No. 16227558

>>16227550
the most tranny shit about this is that inflation yoy is probably like at least 5%, not the fake number they posted and economy grow is like 3% ish, which means actually the economy shrunk by 2%+ adjusted for inflation but they will claim the economy grow strongly anyway. it's banana repulic we're living now. if they keep delaying the recession, I expect the McD big mac will be $10+ in 10 years.

Anonymous at Mon, 10 Jun 2024 22:31:28 UTC No. 16227561

>>16227555
>is to raise the criteria for loans, impose limits on loans and so on.
The criteria still being purely monetary abstraction tied to monetary abstraction as opposed to biological insurable interests. This is where multiracial multiculturalism creates the borrowing pressures where a familiar homogenous stable society would have bullish pressures. The leftist social platforms are all mathematically perfect to mean bad news for mom and pop business.

Anonymous at Mon, 10 Jun 2024 22:35:41 UTC No. 16227567

>underwrites the entire money supply in your path by the low key quadrillion
Only real math niggas will understand

Anonymous at Mon, 10 Jun 2024 22:35:54 UTC No. 16227568

>>16227521
>NPV
That's finance, not economics

Anonymous at Mon, 10 Jun 2024 22:37:08 UTC No. 16227572

>>16227568
They are related. Especially in a cross discipline question as to define inflation at its various layers.

Anonymous at Mon, 10 Jun 2024 22:39:11 UTC No. 16227577

>>16227561
Occupy Wall Street had no LGBT BLM greivance parade to distract. Even the majority of the Bernie Sanders campaign was economic in nature until it got the Biden Buttfuck.

Anonymous at Mon, 10 Jun 2024 22:40:27 UTC No. 16227579

>>16227500
>Banks have NO OBLIGATION to keep reserves
They do. The Fed determines how much is that reserve and it does have a direct impact on how much money is created. A more correct criticism would be that their reserves have been kept too low.
>but operate on the assumption that everyone one will not withdraw at the same time.
the amount
That is true and has always been. The only proper type of banking is fractional reserve banking. if you want a bank that will not lend your money out, that's fine, but that bank would be nothing more than a very large mattress. Unironically, buying gold and keeping it in a safe is a good strategy for those who are concerned.
>The fundamental rules of lending have changed in a way that was impossible during precious metal backing.
In a way. Not all. Even the first banks in Florence and other Italian cities did fractional reserve banking. And banking hasn't changed much at all since Nixon.
>You will be indefinitely amoritized with refinancing options for a shadowy group of creditors who trade with other creditors
only if you don't know what you're doing.
>Higher interest rates essentially mean usury
I don't care about desert kike gods, so this means nothing.
>which does not combat the weakening of purchasing power
it does, because we have central banks, fiduciary money, government spending and regulated banking
>as a fundamental currency value
no such thing. not even gold, since it's a commodity.
>but combats the decentralizing of purchasing power outside of solvently credited and crediting institutions.
I'm not sure what you mean, but if it is what I think, then you're way behind the issue. Regulated banking already does that. Wanna go back to banks issuing their own currency? fine. or do you just want gold to be back?

Anonymous at Mon, 10 Jun 2024 22:40:53 UTC No. 16227581

>>16227267
Less loans less money in circulation

But that never plays out in practice

Anonymous at Mon, 10 Jun 2024 22:43:29 UTC No. 16227585

>>16227561
ok, time for your meds.

Anonymous at Mon, 10 Jun 2024 22:44:52 UTC No. 16227587

>>16227581
that does plays out in practice all the time. it is not playing right now for several reasons. the most important of those are the sustained government deficits.

Anonymous at Mon, 10 Jun 2024 22:50:33 UTC No. 16227602

>>16227267
>Why hasn’t the figure risen by more? Millions of American homeowners refinanced their mortgages at very low rates during the past decade and a half when the Fed mostly kept its key rate at nearly zero to bolster the economy. As a result, their mortgages remain low and their finances largely unaffected by the Fed’s policies. Consumers who paid off their cars, or who took out low-rate five-year car loans before rates rose, have also felt little impact.

>The average rate for a new 30-year mortgage is nearly 7.1%, according to mortgage giant Freddie Mac. But Goldberg calculates that the average rate on all outstanding mortgages is just 3.8%, not much higher than 3.3% when the Fed began to hike rates. The gap between new rates and the average outstanding is the highest since the 1980s.

>“One of the things we hear is that maybe because so many Americans refinanced their mortgages when mortgage rates dropped during the pandemic ... people are not feeling the bite of higher mortgage rates yet,”

Anonymous at Mon, 10 Jun 2024 22:50:53 UTC No. 16227603

>>16227579
I have never spoken to a more slogan proof person than this deep thinking discerning Anon.
>I don't care about desert kike gods, so this means nothing.
What does a community of borrowers and lenders of this sort look like? Does that even exist?
>no such thing as a fundamental currency value. not even gold, since it's a commodity.
I have never heard it said so succinctly! A promissary note is inherently flawed as the act of promising itself is flawed regardless of systems sophistications.
I believe in commodity backed currency as the fundemental unit of exchange because it is primitive, it is the failsafe that emerges in the absence of Big finance. Its fine to go back to rural francs and marks kind of isolation especially as a thought experiment to show the market game for what it concretely is to the players involved. Our opaque global economy sacrifices communities in ways only described by desert kike gods and the desert kike god companies.

Anonymous at Mon, 10 Jun 2024 22:51:41 UTC No. 16227605

>>16227602
low mortgage rate doesn't mean shit when everyone lose their job in a recession. they have to firesale their houses anyway.

Anonymous at Mon, 10 Jun 2024 22:52:54 UTC No. 16227606

>>16227603
>fundamental currency value
Yeah that will be 3 objective moralities and 44 oughts from an is after tax.

Anonymous at Mon, 10 Jun 2024 22:57:19 UTC No. 16227612

>>16227587
>oh yeah Im obliged to pay back what I borrowed while Im sitting on an invincible arsenal of fuck you I got mine

Anonymous at Mon, 10 Jun 2024 22:57:38 UTC No. 16227613

>>16227603
kek fair enough. just be advised that you primitive forms of exchanging goods and services will also lead to primitive forms of living. industrial and post-industrial societies absolutely do need the abundance of credit that only modern regulated banking and can give.

B00T at Mon, 10 Jun 2024 22:59:54 UTC No. 16227615

>>16227613
Postan in a B00T approved thread.

Anonymous at Mon, 10 Jun 2024 23:00:03 UTC No. 16227617

>>16227612
quite so, yes. unless you don't actually want people to lend you more money in the future.
btw, aircraft carriers are already done.

Anonymous at Mon, 10 Jun 2024 23:08:54 UTC No. 16227624

>>16227617
On purely material terms America doesn't need to borrow and can easily triumph as an isolated enclave with no one coming close to their lending power. However after leftism which dominates the American mind...
China will prevail.

Anonymous at Mon, 10 Jun 2024 23:18:50 UTC No. 16227640

>>16227624
It's not only foreign lenders, anon. American banks, American pension funds, American families all hold government bonds. Do you plan on just not paying the foreigners? That will still have consequences, you know.
>American can easily triumph as an isolated enclave
don't be so sure. It can surely fare better than most, especially if you annex Canada, but international trade is still very much important.

Anonymous at Mon, 10 Jun 2024 23:24:37 UTC No. 16227651

>>16227640
>international trade is still very much important.
Lol no
If we burn the Pajeet boats no
If the Pajeets and Pacos and Changs leave...
Then it's McFucked

Anonymous at Mon, 10 Jun 2024 23:25:33 UTC No. 16227654

>>16227612
it's all about leverage, and violence is a type of leverage. normalcattle will never understand this.

Anonymous at Tue, 11 Jun 2024 06:31:02 UTC No. 16228039

>>16227267
>How exactly does raising interest rates reduce inflation?
>>>/biz/

Anonymous at Tue, 11 Jun 2024 06:32:20 UTC No. 16228041

>>16227267
>economics is science
imaginary money and rates are finance, not economics
>>>/biz/