Joff
Stephen GentleOne really big thing I want to see in my lifetime - the mainstream acceptance that the central bank *simply cannot* fix inflation by raising rates.
It’s utter lunacy and it hurts millions of people. And it just doesn’t work.
Dandelion@stephengentle in fairness to the RBA, they get the headlines because they're legally required to manage interest rates to combat inflation. They have basically one tool.
They're supposed to be supported by a functional government implementing sensible fiscal policies like, I don't know, addressing housing affordability by removing tax breaks for the wealthy, or addressing cost of living issues by breaking up our many monopolies/duopolies, etc.
The problem is that there's no requirement for government to be more useful than a barbed-wire canoe so that doesn't happen.
I mean, we have a lot of oil and gas here. Weird how we're so impacted by oil being shipped from other parts of the world. Surely we're not being taken for a ride for the benefit of oil and gas companies.
Oh well, I'm sure we'll at least be getting a major budget lift from all the tax we earn on our suddenly very profitable exports...
Phil Burg (he/him)@dashlion @stephengentle Exactly right.
Interest rates are the tool for managing demand pull inflation, but are at best ineffective (and may even exacerbate) supply shock inflation.
Shame we have the latter not the former...
mike805@stephengentle They have to consider the cause not just the symptom.
If the inflation is caused by too-easy credit then sure, raising rates will slow it down.
But if the inflation is caused by a physical shortage of gasoline, then no financial manipulation will fix it. Giving out more money in that case will make it worse, as the extra money bids on the same amount of fuel.
The USA made that mistake in the 70s.
Heliograph@stephengentle you had me at "utter lunacy" 
it is bizarre almost perverse how they just keep hammering that one tool which quite obviously does not work 😒 and on top right now their timing is quadrouply bad 
it is bizarre almost perverse how they just keep hammering that one tool which quite obviously does not work 😒 and on top right now their timing is quadrouply bad 
Greg@stephengentle I'd love it if every time inflation went up, the media pointed out that the government could help manage inflation by TAXING THE RICH.
bananamangodog@stephengentle Your post is forgetting that hurting millions of people is precisely the point. Hurting them just enough they're preoccupied enough with surviving that they don't have the energy to change anything; and not quite desperate enough that they revolt and burn it down.