06/17/2022
I don't quote from the National Post that often, but i think this headline is bang on - when i saw the Liberals were going to spend huge amounts of money to try to alleviate inflation woes, it struck me as completely counterintuitive. They are doing one thing right though in not hammering on working people in order to get inflation in check. The old theory about there being a tradeoff between inflation and unemployment has been proved to be quite lacking in evidence. This was called the Phillips Curve in economics textbooks, (google it) and later transmuted into the "NAIRU" the non accelerating inflation rate of unemployment (catchy i know) ... this was a false economics gospel from the 70's until the 2010's, it was very hard on working people because they were the ones squished financially (via unemployment) to try to tamp down inflation. Then the "Modern Monetary Theory" people came along in the 2010 and said that govts could spend as much as they wanted . . . without provoking inflation. It sounded too good to be true . . . and probably was. Modern economics doesn't really have a solid theory about what causes inflation but my gut says it is spawned mainly in the banking and financial sector, and the govt should be reducing the amount banks can lend, rather than increasing the minimum interest rate they can charge, via the reserve ratio. What do you think the government should do? (MLP)
Growing signs the Liberals are done with Trudeau
