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Inflation

Can The US Federal Reserve Really Control Inflation?

September 1, 2024 Radhika Desai and Michael Hudson, Geopolitical Economy. , , ,
Another August, another speech by the Federal Reserve Chairman at the Jackson Hole Conference, where top central bankers and economists go to hobnob. So what’s new? Well, plenty. The last two speeches by Chairman Jerome Powell in 2022 and 2023 had markets nose-diving. In 2022, appearing contrite about having considered inflation transitory, Powell signaled that the unrelenting rate rises and promised to do all it takes to slay the dragon of inflation. Markets, high as they have been on the easy money of recent decades, went into severe and violent withdrawal. The following year, having brought rates up from a low of 0.25 percent to 5.5 percent, Powell now promised to keep them higher for longer, as he put it, because that is what he considered necessary to quell the still-persisting inflation.

Two Years And $300 Billion Into Biden’s Climate Plan, Emissions Are Higher

August 26, 2024 Peter Gelderloos, In These Times. , , , , , ,
August 16 marked the two-year anniversary of the Inflation Reduction Act (IRA), legislation that has funneled hundreds of billions of dollars into green energy and electric vehicles. While the Act made unprecedented investments in renewable energy, it also faced criticism for being too little, too late and for compromising on fossil fuel extraction. In response, Environmental Protection Agency Administrator Michael Regan acknowledged the bill’s shortcomings but explained the administration’s approach: ​“We’re using every tool in our toolbox to drive down climate pollution as much as possible, as quickly as possible.”

(Mostly) Useful Government Numbers About Poverty, Jobs, Unemployment

July 19, 2024 Frank Stricker, Dollars and Sense. , , ,
The federal government generates millions of economic numbers in thousands of publications every year. Some of these publications can be useful for those of us who want to lift working-class living standards and build political support for shifting much more income to the working class and away from the ultra-rich households at the top of the income scale. But not all are as useful as they should be. I discuss and evaluate key publications in five areas. Much government information can be used to construct arguments for our side. The Poverty Line: A Failed Number Does the federal government regularly publish estimates of what a reasonably comfortable living standard would be for an average household?

The Fed’s ‘Chicken Run’: Sticking With High Rates Will Crash The Economy

June 27, 2024 Thomas Ferguson and Servaas Storm, Scheer Post. , , ,
On June 13th, financial markets discovered they had overestimated the likelihood that the Federal Reserve would soon be cutting interest rates. Federal Reserve Chair Jerome Powell’s remarks at his press conference and the Federal Open Market Committee’s freshly updated quarterly “Summary of Economic Projections” pointed forcibly to the conclusion that the Fed would likely cut rates only once before the end of 2024. In the midst of their own historic surge, US financial markets could mostly afford just to sigh. Reactions elsewhere were less sanguine: Some international commentators worried that higher for longer US rates would make repaying foreign dollar loans harder and accelerate a movement of capital out of the developing world.

Big Food, Big Profits, Big Lies

June 11, 2024 Veronica Riccobene, Portside. , , ,
As food costs have skyrocketed for Americans, some of the country’s biggest chains and grocery brands, including General Mills, PepsiCo, and Tyson, have blamed the price hikes on supply chain issues and economywide inflation. But behind the scenes, these companies have expanded profits and quietly authorized billions of dollars in lucrative stock buyback programs and dividend payouts to shareholders.

Used Clothing Market In US Grew 7x Faster Than General Clothing Retail

March 29, 2024 Cristen Hemingway Jaynes, EcoWatch. , , ,
Sales of secondhand clothing are on their way to making up 10 percent of the fashion market worldwide, as environmental concerns and high prices inspire consumers to shop for pre-loved items, according to a 2024 Resale Report by online thrift and consignment shop ThredUp. The 12th annual study, conducted by analytics firm GlobalData, includes projections through 2033. Its findings are based on a survey of 3,654 consumers in the United States, as well as a survey of 50 of the country’s top fashion brands and retailers, a press release from ThredUp said.

Farmers’ Protests Challenging EU Policies Spread To Eastern Europe

February 28, 2024 People's Dispatch. , , ,
Farmers and their unions in Eastern and Central Europe, are mobilizing in large numbers against growing economic distress. They have expressed their rejection of provisions in the European Union’s Common Agricultural Policy (CAP) and the Green Deal, and against the high cost of production and low incomes, import of tariff-free grains from Ukraine war efforts, and exhaustive bureaucratic procedures in farm-related laws and regulations. Farmers affiliated with the Agrarian Chamber of the Czech Republic (AKCR), Slovak Chamber of Agriculture and Food Industry, unions in Poland, and many others participated in rallies and road blocks on February 22, demanding concrete policy measures from their respective governments and the European Union (EU) in solving their grievances.

It’s Important To Focus On Companies Using Inflation To Jack Up Prices

February 16, 2024 Janine Jackson, Fairness and Accuracy in Reporting , , ,
If you buy groceries, you know that prices are high. And if you read the paper, you’ve probably heard that prices are high because of, well, “inflation,” and “shocks to the supply chain,” and other language you understand, but don’t quite understand. One article told me that economists see pandemic-related spending meant to stabilize the economy as a factor, along with war-impacted supply chains and steps taken by the Federal Reserve to raise interest rates —all of which may be true, but still doesn’t really help me see why four sticks of butter now cost $8. Not to mention that the same piece talks matter of factly about “upward pressure on wages,” which sounds like people who need to buy butter are getting paid more, but I’m pretty sure the language is telling me I’m supposed to be against it.

Cuba’s Humanitarian Crisis

January 4, 2024 William M. LeoGrande, The Nation. , , ,
Nine years ago, on December 17, 2014, jubilation swept the through the city of Havana when Presidents Barack Obama and Raúl Castro announced that they would normalize US-Cuban relations, after 55 years of hostility. Church bells rang, cars honked their horns, and people hugged each other in the streets. Today, the mood in the city is one of desperation. The economy is spiraling downward, and US policy is exacerbating the growing humanitarian crisis. President Donald Trump’s tough economic sanctions drastically reduced Cuba’s foreign exchange earnings, and President Joe Biden has left most of those sanctions in place.

World’s Economic Centre Of Gravity Is Returning To Asia

December 29, 2023 Vijay Prashad, Tricontinental: Institute for Social Research. , , , , ,
In October 2023, the United Nations Conference on Trade and Development (UNCTAD) published its annual Trade and Development Report. Nothing in the report came as a major surprise. The growth of the global Gross Domestic Product (GDP) continues to decline with no sign of a rebound. Following a modest post-pandemic recovery of 6.1% in 2021, economic growth in 2023 fell to 2.4%, below pre-pandemic levels, and is projected to remain at 2.5% in 2024. The global economy, UNCTAD says, is ‘flying at “stall speed”’, with all conventional indicators showing that most of the world is experiencing a recession.

Thousands Take To The Streets In Argentina

December 21, 2023 Gabriel Vera Lopes, People's Dispatch. , , , , , ,
Thousands of Argentines demonstrated, this Wednesday December 20, “against the economic austerity measures” implemented by Javier Milei’s government. The day was marked by high tension early on, following a major police operation carried out at the main entrances to the city of Buenos Aires. The Minister of Security, Patricia Bullrich, announced that she would debut her “anti-picketing protocol”, presented last Friday December 15, and threatened that they would not allow the demonstration to take place. However, the call to mobilization managed to overcome the fear that the government tried to install.

Why Mainstream Economics Got Inflation Wrong

November 20, 2023 James K. Galbraith, Portside. , , ,
Austin - In his November 7, 2023 New York Times newsletter, the economist Paul Krugman asks a good, albeit belated, question: Why did so many economists get the inflation outlook wrong? After all, the near-consensus among mainstream economists in recent years was that inflation would persist – and even accelerate – and that this justified substantial interest-rate hikes by the US Federal Reserve. Yet the quasi-inflation of 2021-22 proved transitory. Krugman poses his question with impeccable diplomacy, professing “respect” for three authors of a September 2022 paper published by the Brookings Institution (which was then promoted by Harvard University’s Jason Furman) projecting that it would take at least two years of unemployment at 6.5% to bring inflation back to the Fed’s self-imposed 2% target.

Poverty Rose In 2022 As Inflation Surged, Pandemic Aid Terminated

September 13, 2023 Max Jones, Scheer Post. , , , ,
In the aftermath of pandemic relief programs such as increased unemployment and nutrition benefits, greater rental assistance and the child tax credit — policies which the Biden administration allowed to expire in 2021 — Americans faced the largest one-year increase of poverty on record. According to a report from the Census Bureau published on Sept. 12, the sharpest increase in poverty affected children, as child poverty more than doubled from a record low of 5.2 percent to now 12.4 percent. This was indicated by the Supplemental Poverty Measure, which “factors in the impact of government assistance and geographical differences in the cost of living.”

Tenants And Left In Austria Demand Rent Freeze To Tackle Housing Crisis

August 14, 2023 People's Dispatch. , , ,
In the wake of an unabated housing crisis and soaring rents, working class sections in Austria have intensified their campaign demanding long-term rent freeze and reforms in the country’s rental law. In its petition, the Communist Party of Austria (KPO) demanded the Austrian People’s Party (OVP)-Greens-led federal government to freeze rents at the current levels until 2029. The Communist Youth of Austria (KJO) endorsed this demand. Groups including the Austrian Tenants’ Association and the Austrian Trade Union Confederation (ÖGB) have also called for a freeze on rents. According to reports, persistently high inflation and a rising Consumer Price Index (CPI) led to a continuous increase in rental prices across the country.

How The Global Financial System Traps Countries In Debt

July 12, 2023 Radhika Desai, Michael Hudson and Ann Pettifor, Geopolitical Economy. , , , , ,
So what we were going to talk about is really the Third World debt crisis, the new Third World debt crisis. How similar and how different is it from the one that hit the Third World back in the 1980s? What has been the specific contribution, if any, of the pandemic and the war? And what is the future of the Third World, given that in addition to all the other calamities, it is now hit with this debt crisis? Now, last time we started with a list of seven questions and we only got through the first two. So let me just go through the seven questions and then we will begin with the third question. So the first question was, what was the genesis of the 1980s debt crisis?
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