-
@mariner4life Inflation ex-energy was mostly due to excess demand, as people stayed home and got given free money during the pandemic, which they largely spent on stuff, which then got snarled up in supply chains due to lockdowns. This part can be fixed by raising rates.
The energy cost inflation, which hurts the most esp. poorer people, is due to decades of underinvestment in critical fossil fuel capacity, misallocation of capital to ESG, shutting down of nuclear projects, and general pandering by scientifically illiterate politicians to the public by way of conning them that solar panels and wind farms can solve all climate/energy problems, which they cannot. Raising rates doesn't help here. Nothing can, really, in the short term.
-
Reserve bank is saying inflation is 50 50. 50% supply chain war overseas stuff.
So 50% can be reduced through raising rates.
Nz has had crazy house price inflation which has added a lot of demand everywhere.
What I find ridiculous is the reserve bank watched prices go absolutely nuts whilst they sat on on their lvr controls (which should never have been reduced). And now they've completely flipped switch and are just pumping interest rates up after they encouraged a massive debt binge.
-
@muddyriver said in Inflation:
What I find ridiculous
Ridiculous, but not surprising. Not sure that Orr will go down as an effective Governor. I think we're seeing what happens when you lose focus on the key objectives, and start paying attention to all the noise - unemployment, politics, non-economic world views, etc. They are all important, but there is a core objective that RBNZ have been slow to address (inflation!)
-
@nzzp adding maximum sustainable employment, (whatever that means) to the RBNZ's Policy Targets just ahead of a global pandemic and associated lockdown's didn't help either.
House price inflation supporting a blow out in(already high) household debt has contributed. Everyone wails about the problem but we all want other peoples houses to become more affordable. 50% of NZ's mortgages expire in the next 12 months and will have to be recalculated. That's going to be a world of hurt for a lot of people.
-
@nzzp adding maximum sustainable employment, (whatever that means) to the RBNZ's Policy Targets just ahead of a global pandemic and associated lockdown's didn't help either.
House price inflation supporting a blow out in(already high) household debt has contributed. Everyone wails about the problem but we all want other peoples houses to become more affordable. 50% of NZ's mortgages expire in the next 12 months and will have to be recalculated. That's going to be a world of hurt for a lot of people.
are we still seeing the real effects of the stalling of real wage growth in the 90s, the subsequent explosion in household lending pushed by the finance industry to get people to still buy shit? The thing that blew up reasonably spectacularly in 2008. The thing we then tried to fix by dropping interest rates to nothing. And thus beginning the cycle again?
-
-
@antipodean said in Inflation:
This should help address inflation in Germany
Don’t be uncharitable. Germany has ballooned their money supply before and there were hardly any negative consequences.
-
-
Inflation