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Kaelik
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Post by Kaelik »

Maj wrote:I love Den conversations. I learn so much (thank you).

How does low unemployment lead to high inflation? That's the mystical step I don't get here. It seems like an underpants gnome's phase two.
That's the underpants gnome step. There is no justification and there is no evidence it has ever been true, it's just a thing that right wingers want to assume is true, and since right wingers control economics they said it and everyone decided to believe them.
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Post by DSMatticus »

So, let me say something seemingly unrelated: it is entirely possible to have a supply-side recession, but the people worried about supply-side recessions today are charlatans who want the government to help them extract wealth from the bottom and redistribute it to the top. It's not a realistic concern, it's a boogie man. It is a non-threat whose spectre is maliciously invoked for a particular policy purpose.

Similarly, in theory, there are circumstances where aggressive stimulus and low unemployment could lead to high inflation - but you've never seen that happen and you're never going to see that happen. It's not a realistic concern, it's a boogie man. It is a non-threat whose spectre is maliciously invoked for a particular policy purpose. For example, imagine a situation with 0% unemployment in which wages (on average) perfectly represent contributed economic value. What outlet is there for all the 'pressure' you're pumping into the system?

Of course, in the real world we've had chronic non-trivial unemployment since the Great Recession and wages are only about 2/3rd's of what they would be if they had just kept up with productivity over the past fifty years (and it's not like fairness reigned fifty years ago, either). The amount of slack currently in the labor market is absurd - I'm tempted to say unprecedented outside of recession or some other obvious economic crisis, but I'm sure if I invite the challenge someone'll find something.

So the step 2 isn't quite literal underpants gnomes, it's just a bunch of complete lies about the economy intended to suggest that there's no further room to improve the plight of the working man, when in truth that has probably literally never been true ever in the history of the world.
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Post by Maj »

erik wrote:Low unemployment means employers have to compete for workers... by offering higher wages. With higher wages it becomes more expensive to produce goods and those prices go up too. Thus inflation.

[edit: that said, fuckers still should be paying employees more. for a lot of businesses the cost of paying employees a decent wage wouldn't massively impact their bottom line.]
This is the standard explanation, but as Kaelik and DSM have said, it's not really backed by anything. I live near the Seattle experiment: the city raised its minimum wage to $15/hour. And yeah, some people lost their jobs as the change was made because every change brings with it a side of shake-ups. But there was no massive unemployment crisis as predicted (business after business were supposed to go under because they couldn't pay their employees).

And in the last couple of years, both Walmart and McDonalds upped the minimum wage that they would pay their workers, and both saw sales increase at their stores and directly attributed it to the wage increase. (Shit, last month Walmart's CEO said the federal minimum wage should be raised.)

So I know that the doom and gloom is not based on evidence. I just keep expecting experts to have better evidence than Phase 2. I mean, people pay money and time to study this shit and it's all... Nothing.

So, apparently, I do understand it correctly. It's bullshit.

So next question: Is there anything else tying together inflation and unemployment? If so, what? If not, what exactly is the point of the Federal Reserve's ability to control inflation?
Last edited by Maj on Sat Jul 20, 2019 5:04 am, edited 1 time in total.
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Post by Orca »

As I understand it the Federal Reserve or other countries' equivalent can influence though not control interest rates. Not inflation, at least directly. There are observable links from interest rates to employment rates and inflation, though the detail of the theories linking them sounds shaky to me. I'm not an economist OTOH.
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Post by Grek »

Inflation is prices going up. Employed people have more money than unemployed people. When unemployment goes down, the average customer has more money. This causes companies to increase prices, since they know their customers can afford to pay more. Thus, inflation.

Inflation is very good if you have debt, but very bad if you have money. Because rich people (definitionally) have money, they hate inflation. The Federal Reserve is staffed by and for rich people, and so they do everything in their power to keep inflation down. This includes doing so by keeping people out of work.

Note that inflation is not a bad thing. Inflation alongside a growing economy (and if you got unemployment down, the economy would grow a lot) is good for society, as it erodes the benefits amassed by the wealthy and eases the burdens placed on the poor. There's no reason to think that getting unemployment down would be anything but an unalloyed good for the country.
Last edited by Grek on Sat Jul 20, 2019 11:40 am, edited 2 times in total.
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Post by tussock »

Inflation is directly controlled by the central bank's interest rates, because that largely controls how much money is rolling around in society at any particular time. There's limits on that simple process because the rate can get to zero and there are other factors pushing it, but there's ways around that too, govt. always has control.

Like, in NZ our reserve bank act, it controls inflation by the use of interest on 90-day bonds, which are compulsorily used by banks to initiate lending arrangements in NZ. One of the major parties likes 0-2% inflation, and the other one likes 2-5% inflation, and when they are in power they direct the reserve bank to do that and it always works. Always.

As it happens, when you have higher inflation, you have lower unemployment. That is the driving factor of that pair, employment goes up with inflation, because the thing driving inflation is also driving employment. There is more money, spending it creates jobs, but also the money is ultimately less valuable in trade.

At some point, more money stops creating jobs because everyone who can work more is already doing that. If govts do that, and try to increase money again, that is the dangerous territory, can easily lead to hyperinflation, after a few years of it.


You can of course also get higher employment without reducing interest rates and causing inflation. You can have a government that taxes the rich and uses that money to provide services to the poor, which creates a great deal of employment because it's extremely labour-intensive to provide for the poor while looking out for corruption.

That does not create much inflation, there's just less of society's goods and services going to a handful of rich folk, and more to the poor and those who serve their needs.

You can likewise get lower employment by lowering taxes on the rich and reducing services to the poor, because it turns out you don't need any more people to build a $500k car compared to how many build a $20k car, and also houses and such, but all that labour-intensive work for the poor just stops happening and those people get sacked.


So lots of things governments do changes employment rates, but very little of it compares to the basics of central bank interest rates, and the basics of the taxation system. Also, lots of governments want wages down, because they are cruel and stupid, and keeping unemployment deliberately high for a long time will do that.
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Post by DSMatticus »

The standard vehicle by which central banks fight unemployment is by lowering interest rates in the expectation that cheaper credit will entice businesses to take out loans and expand their businesses, creating jobs. This is considered to be potentially inflationary because it increases the effective money supply - every buck loaned is another virtual buck floating around, so if you had an economy that was already at some stable equilibrium you would expect it to trend back to that equilibruim even as you pumped money into it - and the only way to reach the old equilibrium with the new, larger money supply is inflation (and even when not at equilibrium, you expect some fraction of the increased money supply to manifest as inflation just because - but it's not 1:1).

If you are particularly observant, you may have noticed that all of this sounds suspiciously supply side. The central bank fights recessions by throwing cheap loans at businesses and waiting for it to trickle down? Really? And that's probably why the mechanism basically stopped working in the wake of the Great Recession and we hit the zero lower bound (i.e. we pushed interest rates all the way down to zero). For rich people, debt is less an obligation and more something you shuffle from entity to entity until you think you can get away with cashing out before letting the husk you just gutted for scrap declare bankruptcy. Remember, Mitt Romney basically made his career buying out failing companies, writing himself a check for ALL THE MONEY!!1!, and then letting them go ahead and declare bankruptcy. Offering Mitt Romney a loan to expand his business probably would have destroyed more jobs than it created. Standard economics models don't work very well when a substantial portion of the economy is just rich white douchebags stealing your pension.

But the mechanism does demonstrably work; the economy isn't all Bain Capital's, after all. I find it more helpful to think of it in terms of expected returns; if you put a thousand dollars in a Scrooge McDuck vault, it's not actually going to be worth a thousand dollars next year. Inflation means it's going to lose value. If you loan a thousand dollars out to someone, it's not actually going to be worth a thousand dollars next year. It's going to be worth a thousand dollars plus interest modified as appropriate by the risk of default. If you spend a thousand dollars to expand your business, it's not actually going to be worth a thousand dollars next year. It's going to be worth the depreciated value of the capital you purchased plus the revenue you earned operating that capital. All of those choices have an expected return, and even if all of those returns are negative, one will be the least negative. You can absolutely convince people to lose money expanding a business, if that's the option that loses the least money. So if interest rates are low enough and inflation is high enough, you can make expanding a business in the middle of a recession look like an attractive option. And that means more jobs. Which is why this whole process of lowering interest rates to increase inflation to decrease unemployment actually works - we straight-up sabotage all the ways rich people could store wealth to insulate it from the effects of a recession and force them to bite the bullet with the rest of us and buy into the economy.

And now you can probably see why rich people fucking hate it, and why they are willing to write absolutely anything in for step 2 as long as step 3 is getting to keep access to high interest rate bonds and shit.

On the topic of the minimum wage: some portion of a minimum wage increase is inflationary almost by definition. Labor is a component of the cost of production, so higher labor costs means higher prices - but the prices don't go up enough to offset the entire cost of the minimum wage increase because that's not how fucking economics works. Prices are decided by the intersection of a demand and supply, not just supply, and as such in all real-world circumstances it is economically optimal for employers to pay for some portion of the minimum wage increase out of their profit margins, and that's going to remain true until their profit margins approach zero. At a ballpark, I put the minimum wage at which that would happen at no less than ~$25, but possibly much higher. That's not completely from my asshole; it's roughly the highest the U.S.'s federal minimum wage has ever been, adjusted for inflation, and multipled by productivity growth. It's essentially what the minimum wage would look like if our share of the economic pie was as proportionally large as our grandparent's - which is why I say no less than, but possibly much higher. It's not like our grandparents won the class war for us and we fumbled it; that was a battle in progress that they wandered away from so they could go be racist to brown people.
Last edited by DSMatticus on Sun Jul 21, 2019 9:58 am, edited 1 time in total.
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Post by Maj »

DSM wrote:you may have noticed that all of this sounds suspiciously supply side
Yep. And it is very irksome. I must be particularly prickly today because I just want to upend the table and say fuck it.

Another thing that's gotten my goat today is the age of congress people. Why are they so old? One quarter of the House is under age 50, and it's much less for the Senate. Where is Gen X in politics?
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Post by Username17 »

DSM wrote:All of those choices have an expected return, and even if all of those returns are negative, one will be the least negative. You can absolutely convince people to lose money expanding a business, if that's the option that loses the least money. So if interest rates are low enough and inflation is high enough, you can make expanding a business in the middle of a recession look like an attractive option. And that means more jobs. Which is why this whole process of lowering interest rates to increase inflation to decrease unemployment actually works - we straight-up sabotage all the ways rich people could store wealth to insulate it from the effects of a recession and force them to bite the bullet with the rest of us and buy into the economy.
This is indeed why it works. But it's also why the mechanism has a difficult time doing anything when we hit the zero lower bound.

It's logistically difficult and politically volatile to offer businesses interest rates below zero percent. But also once the interest rates fall below zero percent the Scrooge McDuck Vault option stops being off the table for what businesses can do with those loaned funds. If the interest rates fall low enough, a non-zero number of businesses will end up taking the loan and just sitting on the cash and handing it back at the end.

If the expected rate of return falls low enough, the central bank loses the ability to dictate where the maximum rate of return is. And ideally, that's where government tax and spend powers come in. If you can't offer incentives to make rich people spend their money where it will do the most good, you can still just take the money and spend it where it will do the most good.

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Post by Kaelik »

Maj wrote:
DSM wrote:you may have noticed that all of this sounds suspiciously supply side
Yep. And it is very irksome. I must be particularly prickly today because I just want to upend the table and say fuck it.

Another thing that's gotten my goat today is the age of congress people. Why are they so old? One quarter of the House is under age 50, and it's much less for the Senate. Where is Gen X in politics?
Primarying someone in your own party is very hard, because all of the people who are supposed to be your allies will team up to murder you for it and then treat you like shit. (Sometimes you can get away with it, but it's rare.)

Most districts are drawn to guarantee that one party will always win them forever.

The people in "Leadership" positions are going to be the people who have been there the longest.

What you get is a perfect storm where a bunch of really fucking old people never retire, never get primaried, never get run against in the general, and build up the seniority to occupy all the leadership positions.
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Post by Maj »

Do we have a venting thread? (Arguably, the whole Den is for venting.) Because there are some times when I just do. not. get. people.

For example:

I live in Washington. We vote by mail.

SO WHY DO ALL THESE PEOPLE KEEP FUCKING ASKING IF OUR LEGISLATORS ARE GOING TO PASS LAWS REQUIRING US TO SHOW ID WHEN WE VOTE?!!

The answer is: Never! Unless we go back to NOT voting by mail! We are not like other states, you stupid dipshits. The talking points don't even apply here.

Oh my god, people. Do you even vote?!
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Post by Foxwarrior »

What if people get required to put their IDs into the envelope with their ballots as proof, hmm?
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Post by Maj »

:rofl:
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Post by Stahlseele »

So. shower thought time ..
Why has Tony Stark not built an Iron Man Suit for Antman to use when he is a Giant?
It should help with the problems the size appearantly brings with it and also allow him to carry a huge arc reactor with enough power to satisfy some truly apocalyptic weaponry . .
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Post by Username17 »

Stahlseele wrote:So. shower thought time ..
Why has Tony Stark not built an Iron Man Suit for Antman to use when he is a Giant?
It should help with the problems the size appearantly brings with it and also allow him to carry a huge arc reactor with enough power to satisfy some truly apocalyptic weaponry . .
The size changing physics of Ant Man are in no way consistent. Sometimes he's clearly changing mass, sometimes he's clearly not. Sometimes he's clearly changing density, sometimes he's not. Sometimes he's clearly using the cube square law, sometimes he is not.

The physics of giant size don't make any sense, since most of the rants they have about how it works when he's tiny would leave him too weak to stand or possibly so light as to literally float away if he became very large. But that obviously does not happen most of the time he turns the dial that way, so who knows?

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Post by DrPraetor »

FrankTrollman wrote:
The size changing physics of Ant Man are in no way consistent.
Sure they are.
https://thetrove.net/Books/_Collections ... lebook.pdf

Shrinking increases his DCV and increases the amount of knockback he takes (but not damage.)
Growth increases his strength, reach, presence attack dice, and so on.
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Post by Zaranthan »

Cute, but HERO's size rules don't produce Ant Man. They produce Honey, I Shrunk the Kids.
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Post by Iduno »

I remember seeing an episode of The Jim Henson Show when I was young. It was about CGI, I think. However, Internet claims there is no such thing. Does anyone remember that, or know where I could see it again?
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Post by erik »

Here ya go.
[url wrote:https://en.wikipedia.org/wiki/Timeline_ ... television[/url]]
The Jim Henson HourTV series with real-time and rendered CGI featuring digitally puppeteered CG character "Waldo."

Episode 1 is first appearance of Waldo C Graphic


edit:
Dunno if this fragment is from the video you're remembering.
Last edited by erik on Sun Jul 28, 2019 3:30 am, edited 1 time in total.
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Post by Iduno »

Thank you, erik.
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Post by Chamomile »

Is there any place you can look up the court cases for any given court in the nation? I could use a resource on what the perfectly average and probably very uninteresting cases you would expect a low-level court to be churning through on a daily basis.
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Post by Kaelik »

Chamomile wrote:Is there any place you can look up the court cases for any given court in the nation? I could use a resource on what the perfectly average and probably very uninteresting cases you would expect a low-level court to be churning through on a daily basis.
You can find specific state info by state, but I know of no national database that gives you all the states grouped.
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Post by MisterDee »

If you don't need specifically American stuff, there's https://www.canlii.org/en/
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Post by Whatever »

Chamomile wrote:Is there any place you can look up the court cases for any given court in the nation? I could use a resource on what the perfectly average and probably very uninteresting cases you would expect a low-level court to be churning through on a daily basis.
In most states, that will be the county courthouse. There should be a few judges, each with their own docket of cases (typically dockets would be separated out into criminal, civil, family, etc).

The dockets are very much what you would expect. Criminal (state vs defendant) is typically low level stuff that didn't plead--drugs, assault, dui, mostly desperate people/addicts doing stupid things and getting caught. Civil is mostly evictions and debt collection but can include anything where one business or person sues another. Family is the usual mix of restraining orders, divorces, child custody and support.

Anyway, just google the court docket for any location and you'll see what they have.
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Post by Miniature Colossus »

Can someone explain to me why Americans are so upset about A$AP Rocky going on trial in Sweden? He and his posse clearly used excessive amounts of force and are very obvious flight risks. And I can't understand how anyone takes Rocky's claims of human rights abuse seriously. What is going on?

(No I'm not talking about Trump trying to get attention, I'm talking about everyone else.)
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