𝗕𝗼𝗻𝗱𝘀 𝗯𝗲𝗮𝘁 𝗡𝗮𝗽𝗼𝗹𝗲𝗼𝗻, 𝘁𝗼𝗽𝗽𝗹𝗲𝗱 𝗮 𝗽𝗿𝗶𝗺𝗲 𝗺𝗶𝗻𝗶𝘀𝘁𝗲𝗿, 𝗮𝗻𝗱 𝗺𝗮𝗱𝗲 𝗧𝗿𝘂𝗺𝗽 𝗯𝗹𝗶𝗻𝗸. 𝗕𝗼𝗿𝗶𝗻𝗴 𝘁𝗵𝗲𝘆 𝗮𝗿𝗲 𝗻𝗼𝘁. My guest today is Robin Wigglesworth (@RobinWigg), editor of @FTAlphaville and author of A Fabulous Debt, a thousand-year history of the market that sets the price of everything else. We get into: • An Austrian 100 year bond that lost 80%, while a defaulting Argentina paid off better • Why T-bills feel safe but can lose you 50%+ in real terms after inflation • Is private credit the next systemic blowup? • Why the $12 trillion repo mar…
The subject this post names, from the same vocabulary
the directory files beliefs under, and the words it uses that this site has seen
least often elsewhere. Posts are matched on those words alone —
nothing here is a summary of this one.
My view is that an appreciation of China's REER is very much to be desired, but the real (haha) way to get there is through higher inflation domestically, and that means different macro policies.
Construction costs tend to rise at, or above, the level of overall inflation, and it rarely (if ever) gets cheaper to build houses, offices, or other buildings.
we have a very clear definition and expectation of what it is at the staff engineer level because we benchmark ourselves to all the great company out there Google, Facebook and all that
There were booms and busts, and cumulative price inflation was zero, and the United States went from a new-world emerging backwater in the late 1700s to being the world's largest economy by the late 1800s.
The inflation crisis was caused by massive overspending and escalating energy prices, and that is why today I will also declare a national energy emergency.
And so my argument is, that has now opened the door to the presidency of Donald Trump, which is potentially a deeply transformative moment that will change the size and shape of government, that may change our foreign policy profoundly, that may change our immigration policy, that may change the demographics of our country, all of that, and my thesis is that that's all been made possible by inflation.
And so the great mistake of the past years was to forget how fundamental inflation was to the rise of the last political order and to profoundly underestimate how much inflation would change the current political order.
Since inflation is not primarily driven by private-sector lending in the current environment, making borrowing more expensive will not significantly cool the economy.
Structural fiscal deficits have surpassed private sector lending and monetary policy as the primary drivers of economic activity and inflation, marking a fundamental shift in the economy's liquidity dynamics.
It is fair to say that, while economists expected the short end of the yield curve to reflect the higher rates needed to win the fight against inflation, the sharply steeper long end of the yield curve in the last few months has come as a surprise. I shall freely admit that I did not predict it.
Japanese macroeconomic policy is often characterized as a failure, with the central bank unable to achieve its inflation target, a low growth rate, and debt ratios steadily rising to reach more than 170% for net debt and 250% for gross debt. I think it should be seen instead as a qualified success, with the use of aggressive fiscal and monetary policies to compensate for very weak private demand: Output has remained close to potential.
Governments have not been bailed out by their central banks. As I discussed earlier, central bank intervention does not reduce the overall liabilities of the consolidated government, just their composition. And it does not automatically lead to more inflation: It increases the size of the balance sheet of the central bank, but it does not increase the size of the non-interest-paying money stock.
A korrent is a belief a person has stated in their own words: one
sentence stating the claim, backed by a quote and a source, kept at
korrents.com.
Under a name here, the quoted block is what they actually said.
The korrent beneath it is the claim those words support, in
korrents' wording — tap it to see the record, its source, and who
else holds it.
Nobody here wrote their own korrents. They are compiled from public
statements, and a person can change their mind, which is recorded too.
About the English under a post
Some people here publish in a language other than English. Where they
do, this site shows a machine translation beneath the post, in
this typeface — the site's own, not theirs.
The post itself is never changed, moved or hidden: what is set in the
serif above is exactly what the person published, and it is what to
quote them on. A translation can be wrong in ways that matter,
especially about tone.
Only the post's own words are translated. A quoted post, a linked
article and a belief on korrents.com
are left in their original language.