It’s not gonna work

Audio –

18:01 min.

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  • NascentMind

    Inflationary wage risk? don’t really know what I’m trying to say, but here goes. At what point? (If any!) make the cost of travel to work, start to make skilled workers realise they can trade down jobs and be better off. Like lower pay closer to home. Then employers need to pay higher wages to keep skills or retrain
    lower skills to compensate. if these wages/costs rise, the business margins will suffer, and costs will be hard to pass on to consumers.  

    • Mystic

      There are `skill shortages`, but they are not the norm.
      Today, if someone leaves to take employment elsewhere, there will be a dozen people waiting to take his place.

      (I may talk on this today, with your comment in mind)

      • Slough of Despond

        The other factor is that the employment force is not very mobile now.  They can’t leave their underwater homes to seek better pay in other regions.  They can’t afford to take a big hit if/when they try to sell their home.  Those workers who are not bogged down in their homes will benefit due to their mobility.  The lack of employment mobility and the underwater homes are a double whammy for many Americans now.

        (Another great Bernanke impersonation~!)

  • snedmeister1

    Evening, NIck…

    The Pragcap article, has a good question and answer on Japan also…
    Very interesting really….

    Perhaps we shall soon see whether MMR is confirmed as reality, or relegated to the realm of what could have been..??? 

    P.S. Nice graph at the beginning, reference empire expansion….

  • Willbick

    I dont get this ‘financial repression’ theory. Weren’t the WW2 debts paid off in the 1950s and 1960s through genuine economic growth?

    • Mystic

       Reinhart has a paper on that very thing.
      I can’t remember the exact numbers but something like – 60/40 for the US (growth / inflation) and 40/ 60 for the UK.

      • Willbick

        ok thanks

  • Windcutter

    When the Bernank speaks, maybe its a good idea to listen?

    Here’s part one of a four part lecture series, from yesterday a full 86 minutes. 

    I’ve only just tripped over it, so this will take me past my normal bedtime, unless I get bored.

    At least our Mystic will be able to practice the vocals….

  • Mzagar

    About property investment in Germany. It is strange that people would start investing in housing, as the interest on housing loans are not deductible, the agency cost is about 5-6% and the tax on profits are 36 %. On the other hand the tax on equity profits is 0% if you hold them for 2 years. Anyway it is true that he properties have risen very rapidly in some areas, for example in Hamburg, Eppendorf they rose with 48%, looking back about 12 months.

  • Bigcollapso

    The sudden surge of inflation will come from production collapses due to monetary destruction. I will do a video on this soon. At some point, the monetary systems is destroyed from money printing, production will begin to collapse because the producers cannot command enough wealth to continue operating. This is why Inflation and Hyperinflation are really two different animals. Inflation is more money chasing the goods. Hyperinflation is production collapse due to monetary destruction.