this post was submitted on 24 Aug 2023
285 points (96.7% liked)
Asklemmy
43918 readers
1809 users here now
A loosely moderated place to ask open-ended questions
Search asklemmy ๐
If your post meets the following criteria, it's welcome here!
- Open-ended question
- Not offensive: at this point, we do not have the bandwidth to moderate overtly political discussions. Assume best intent and be excellent to each other.
- Not regarding using or support for Lemmy: context, see the list of support communities and tools for finding communities below
- Not ad nauseam inducing: please make sure it is a question that would be new to most members
- An actual topic of discussion
Looking for support?
Looking for a community?
- Lemmyverse: community search
- sub.rehab: maps old subreddits to fediverse options, marks official as such
- !lemmy411@lemmy.ca: a community for finding communities
~Icon~ ~by~ ~@Double_A@discuss.tchncs.de~
founded 5 years ago
MODERATORS
you are viewing a single comment's thread
view the rest of the comments
view the rest of the comments
Can you elaborate?
Raising interest rates to fight inflation works by reducing demand. Jobs get lost so people have less money. So they spend less, so prices drop to be more competitive.
Only poorer people obviously. Rich people are less affected, but still pay more in interest. The increased number of unemployed people means competition for jobs is higher so workers are cheaper to pay, increasing profits again.
High inflation is bad for everyone, but particularly so for the poorer, too. However, measures to fight it should be spread across society. Instead blunt tools like interest rate rises disproportionately affect the poor. They should be combined with higher taxes on business and high earners and high net worth individuals. Worldwide we only really do the first. I wonder who decides?
In addition, I could definitely go for enforcement and expansion of price gouging and profiteering laws.
I would like to see enforcement and expansion of profiteering guillotines.
I like the cut of your jib
It mostly works by forcing companies to pay back their loans rather than keeping them indefinitely, which pulls excess money out of the economy instead of it circulating continuously. When interest rates were near zero and the reserve requirement was dropped for banks, a shitload of this lending was done multiple times, so they're hoping to effectively claw that back
Especially because, as far as I can see, inflation isn't being caused by demand for necessaries. And, these days, an increasing number of people are pretty much only able to afford the basics necessities (if even that) did to talk terms pay cuts as a result of inflation.
Mainly just my absolute shock at the openness of saying "We really need to see a weaker labor market." Seriously??? That is where we are at now. The complete and transparent assault on the worker by people I personally fund. Outrageous! At least lie to me about your motives like I might have a modicum of power over you. Now you just tell me to eat shit and die right to my face.