The 2008 crash was a long time coming, but the crisis we’re in now came as an overnight delivery. So how are fiscal policy and monetary policy being applied to deal with this emergency?
Where I disagree is the defense of the 2017 tax cut as having no negative effect. When things are going good, as they were, that’s the time to pay off some debt. Stephanie Kelton almost makes it sound as though everything can be financed with debt, rather than taxes, which is a ludicrous idea.
Ending social isolation too soon is just about as smart as, say, blowing up a beached whale.
A tip o’ the DogRat toupee to Denro for the idea.
Remember when those red Netflix DVD envelopes were everywhere? Digital streaming technology put an end to them, depriving the United States Postal Service of a source of revenue that was helping to make up for the rapid decline of first class postage in the Internet Age.
As John Oliver explains, in 2006 — the year I started this blog and was a 3-disc Netflix subscriber — a new law clobbered USPS finances and hobbled its ability to recover. Trump should be locked in a room with this video playing repeatedly, until he agrees to support the USPS. He doesn’t even have to admit he’s an idiot about everything, which he is, just the post office.
A point that John Oliver doesn’t make is that in many places, like where I live, Amazon deliveries are rarely made by regular mail anymore. Amazon has a large distribution center in a neighboring town with its own fleet of trucks. So in addition to the USPS not losing money on the Amazon deliveries it still makes, it isn’t making nearly as many as it was. Which gets back to one of Oliver’s points about service to rural areas, where many of Trump’s hardcore supporters live.
https://youtu.be/iHaeCNPxZ6M
Thanks to the effects of the virus on the economy, here at last is an all-too-brief discussion about the Federal Reserve’s role in propping up Wall Street, at the expense of the real economy.
As I have said before, the stock market has been over-inflated for years, due to interest rates being held artificially low. With no money to be made in safely insured accounts, such as Certificates of Deposit, it went to equity investments, helping to inflate the market. The Federal Reserve should have been raising rates a long time ago, but didn’t thanks to the core rate of consumer inflation being very low, while income inequality continued to grow. As always, investment bankers became addicted to the bull market, and refused to see the weak ground it was running on.
The last hike in interest rates should have been left in place. The fact that the Fed lowered rates last year was proof that Jay Powell was, at best, using outdated thinking and, at worst, responding to pressure from Trump. Powell needs to see that we can’t return to business as usual, and he must lead the Fed into taking on the role of fighting inflation on Wall Street. It won’t be easy, because if there is a lessening of income inequality — which will require a more progressive tax policy — there is the risk of returning to the days of consumer inflation.
Responsible reporting, intelligent analysis.
