Submitted by H0lland0ats t3_z8ukg0 in wallstreetbets
I keep seeing the posts from MSM opinion pieces pushing narratives regarding the federal reserve and interest rates.
These opinions range from "staglation for a period is good" to "the rich are engineering a recession to buy your assets cheap".
The Federal Reserve has 2 mandates:
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Price stability (i.e inflation)
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Maximize employment
In a normal, healthy economy, these two things follow each other relatively closely for obvious reasons. That is to say, the Fed can usually achieve both goals with the same policy.
Our current economy is neither normal OR healthy for many reasons that are as complex as they are unexpected including: (I'm arriving at a point soon I promise)
1)Massive disruption to global labor markets from Covid, aging populations, and slowing population growth.
2)China zero Covid policies, lockdowns, and major supply chain disruptions associated with closed systems.
3)War and geopolitical factors. Ukraine War has had massive implications for many different commodities and supply chains. Lots to be read about in different posts. Taiwan looms large on the horizon.
4)Climate effects. Avoiding the climate change trap, record droughts and flooding have severely impacted numerous agricultural products, and there's no reason to think these problems will get better.
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Excess liquidity. People will argue about this one, but I think it's clear decades of low or even negative interest rate environments have lead to incredible amounts of cheap debt, and reckless spending.
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Divided Governments. A plurality of western nations are experiencing the greatest political division in history, leading to lack of governance and unpredictable policy (flip flops).
This list can go on and on but here is my point: The Fed cannot achieve both of its mandates. It is in a position where it must choose whether to control Inflation, or employment, or some combination of the 2.
Unfortunately any path the Fed goes down WILL hurt the poor, and increase the wealth gap, in the absence of other policy outside of the Feds control. People can certainly debate whether some amount of employment, or uncontrolled costs are worse for the poor but stop pretending either is good and you are the genius who has their best intentions at heart. After all, this is a subreddit for degen gambling regards. You only care now because you ARE the poor.
TLDR
The Fed doesn't have the tools to keep unemployment and inflation low. High costs and job loss BOTH hurt the poor. If you want to help the poor, the discussion will revolve around government policy not fed policy, and there are many other places to have that conversation.
Quit posting these clickbait opinion pieces from shitstream media that ALL shill for the rich. And most of all stop getting poor from your shitty fucking trades.
Edit:
Fixed some of my shitty formatting. I wrote this on my phone.
VisualMod t1_iydaxsg wrote
^^Discord ^^BanBets ^^VoteBot ^^FAQ ^^Leaderboard ^^- ^^Keep_VM_Alive >TL;DR: The Federal Reserve cannot control both inflation and unemployment at the same time, and any policy it chooses will hurt the poor. If you want to help the poor, you need to focus on government policy, not Fed policy.