How is "Transitory" Inflation Going? | Economics Explained

[@EconomicsExplained]

Links to enter the giveaway! 👇 TypeForm ➡ economicsexplained.typeform.com/mistakes Mistakes spreadsheet template ➡ www.dropbox.com/s/b5h6vtkogi6i054/EE%20Mistakes%20of%202021.xlsx

[@whatsup3519]

I have a question. In Modern Monetary Theory money is printed to fund education, health care but it lead to hyperinflation. It's reduce through tax , is it effective way to control inflation without bond market ? Does it effect it economical growth when tax is high? Any why country like Venezuela can solve it's problem by put High tax to reduce hyperinflation? Could you Please answer my question

[@t.morgan209]

Disable macros before you open those spreadsheets

[@whendricso]

Sailing is SO MUCH FUN I'm not going to win though :'(

[@tando6266]

Here is a point for those outside of the US that wouldn't be aware of this. The extra printing was in part a response to a national cash shortage, in particular coins. No joke, mid last year you would struggle to find anywhere that would take cash that wasn't exact, as they had no change to give. This is easily overlooked if you are not on the ground, and is some important context that even economics explained missed.

[@sabirjoya7924]

Txt is the

[@crookedpaths6612]

As a renter I’ve been subject to unending rental hikes over 10 years driving up my cost of living so much so that rent comprises over 60% of my costs up from 20%. Yet apparently the official inflation rate was 1%. At the same time my wages have stagnated for the past 10 years. Now with a Labour shortage I’ve got the best chance of an increase in take home pay but now the central bank suddenly says my wage demands are fuelling inflation! What crock.

[@stapleman007]

Have you tried finding different places to rent? Can reset the ever rising cost of rent gimmick. IE if people aren't moving out, it just means their rent is too low.

[@juliencotton3095]

@@stapleman007 move where? Property Mangement groups by up housing and control rent.

[@mattja52]

@@stapleman007 It could mean they're paying what they can afford if they live in a rent-stabilized building which is subjected to a gradual increase. Once they move out, the apartment is now market value. There is no such thing as rent too low as far as I know in a modern 21st-century apartment unless you're off-grid.

[@RetroWarhead]

Yeah rent and utilities take up 75% of my monthly income and I work full time making over double the minimum wage. The cost of living has sky rocketed and nobody really is getting paid enough to keep up with it.

[@SlowhandGreg]

Rents go up because there's a lack of housing chiefly at the bottom end the only way of dealing with it is from government action with social housing for the poorest and cooperative housing at the next leg up. Currently with the big corporate tax cut from a few years back you've seen investment entities plow money into realestate reducing the housing stock further The problem is structural and needs a long term government solution that an uncontrolled private sector won't provide what's worse is any attempt to do so will have the same private sector screaming

[@Quickonomics]

I feel like this entire situation has given the word _transitory_ a whole new meaning.

[@rootbeer4888]

great reset

[@blakecampbell6549]

Changing definitions to suit Their needs seems to be the current trick.

[@JysusCryst]

"There's nothing more permanent than a temporary government program." -some smart person

[@1941KiK3YiD]

This is the 1st time I've seen the word transitory, don't plan on using it still don't know what it means, haven't looked it up, might, probably, America🇺🇲🇺🇸

[@leroyrodgers6089]

I think that's part of the point. They've changed a few terms recently. "Vaccinated" "Anti Vax" etc. Etc.

[@saysikerightnow3914]

Economics Explained is pulling a big brain strat right now and I'll explain why. EE tells its audience to point out their mistakes and put them in a spreadsheet. The person who points out the most wins an expensive trip. The commenters then refrain from commenting on the mistakes made in videos in fear of giving someone else help. Less negative (maybe even toxic) comments are posted and EE gets help fact-checking.

[@gamechannel1271]

Sssshhhhhh

[@jfridy]

At the company I worked at (Half Price Books,) the company declared a "Mass Layoff" when the pandemic hit, and fired half of the companies, focusing on senior staff who had higher pay and benefits. I was on medical leave caring for my dying mother when I was fired. They did say they would consider re-hiring me, but at starting pay with no benefits and seniority. Also most likely part time, as the full time staff system previously used has been mostly junked. So I was offered my old job, but now 20 hours instead of 40, and with a 44% pay reduction and no benefits on top of that. Don't shop at Half Price Books.

[@intricatic]

According to the owner of the company I work for, this single quarter has been more profitable than the last 6 combined, all thanks to "inflation." Which is to say, he heard there was inflation and jacked our prices by 25%, then blamed inflation. I have to assume this is not uncommon.

[@life_of_riley88]

Your numbers are only profitable *if* and only *if* your currency is worth the same. If your currency is being devalued. . .your "profit" numbers are actually weaker.

[@sirnedwood8987]

I have had a dozen or so of my suppliers increase prices by 10% 3-4 times since the pandemic started. factor in exchange rate fluctuations and we are up almost 50% for some products.

[@mundie33]

Yep. This is what is happening.

[@intricatic]

@@life_of_riley88 According to our quarterly bonus, our profits are much higher than they've ever been.

[@danielmouncer4131]

If the jacked up prices are still being accepted by customers then the reason why the prices are higher is almost irrelevant, it is still fundamentally part of the inflationary environment. If the demand wasn't there, are the additional money in the system wasn't there, those 25% increases would not be accepted

[@hungrymusicwolf]

1:19 "but, never count on anyone to actually predict the future, least of all economists." You actually made me double over laughing there, I absolutely love this channel.

[@thegoodsmaster]

Go watch Clarke and dawe videos on quantitative easing "I'm an economist and under any number of circumstances were my answers could vary so don't quote me on this"

[@advitrudransh7659]

66% of big companies are making higher profits now than before the pandemic.

[@isabellahewitt8393]

Companies aren't raising prices because of inflation but to raise profits and hope you'll fall for it.

[@ThePhiphler]

This isnt true at all, producer price inflation is far higher than consumer price inflation.

[@mehrshadvr4]

@@ThePhiphler it is true. Walmart admitted they are using inflation as an excuse to raise prices on goods not impacted by inflation and supply problems. Same with meat industry, their profit margins are way higher while paying farmers even less. Monopolies in America are taking advantage of this situation.

[@shayan_idk]

this is absolutely true, and another important thing to note is more than 80% of the stimulus went to corporations. prices are still increasing while wages are not. the media is blaming it all on the individual getting a $1200 check, the entire system is rigged.

[@ThePhiphler]

@@shayan_idk Read the actual numbers. The prices corporations pay has been increasing far faster than the consumer prices. Corporations have been eating the higher prices for the 2 years now. Dont just blithely repeat the talking points of your favourite politician, look at the facts

[@MrTilldaddy]

Here's a bit of a tidbit from my dad the farmer: their RoundUp prices have gone up from $18/gal in Dec 20 to $80/gal in Dec 21. It is a similar story for all agricultural chemicals. It has to do with major production issues in China + inflation + supply chain issues. Basically what this means is that food prices may skyrocket. Also, the commodities market tends to run countercyclical to the stock market so we may also experience a bad stock market crash soon.

[@JesterEric]

Fertiliser prices in Europe at least have had a massive price increase. Its going to be 600 euros a ton this spring. Its a very energy intensive industry and natural gas prices are at record levels. Power cuts are a realistic possibility if Russia does not increase supply. Food prices will be higher and yields reduced. Green environmental policies will further reduce yields driving farmers out of production and discouraging investment in fossil fuels

[@pnkrckmom]

😲

[@roberthamill6326]

I have Cancer from using Roundup and am in a Lawsuit with Monsanto/Bayer .. we need to get rid of Roundup as it's nothing but a Poison

[@neildoerdan2298]

January 18th 2022 is the date set for the stock market collapse. Get those shorts in...

[@donw3861]

So y'all can look forward to wormy produce but at least it'll be GREEN!😜

[@dave1b]

I really like how transparent you are to your audience! That is not something that can be taken for granted. Thanks a lot!

[@MomoTrader809]

Excellent video. Top notch professionally presented. No “the sky is falling” or “the end is nigh!” This is the channel I have been looking for! You should be on TV!

[@CloudStrife1260]

Gotta appreciate it when someone welcomes criticism to help better themselves. Merry Christmas

[@kaisahfx1246]

essential paying people to do their homework.. well one of those people

[@pappaslivery]

My wife and I both had to go on unemployment. My work came back very strong in the last quarter of 2021, and my income has been able to let her sit on the sidelines and wait for the perfect position as opposed to grabbing the first job she could get

[@scpatl4now]

There is a glaring mistake in this video. Not a word about the swift consolidation that has been happening in the economy since the 80's that went into hyper drive in the last several years. They are now starting to flex their pricing muscle since they can point to supply chains, even if they aren't really relevant. Almost two-thirds of publicly traded companies had substantially larger profit margins this year compared to the same period in 2019, before the pandemic. In 2021, close to 100 of them saw their profit margins go up at least 50 percent relative to 2019. Lets talk some examples. Drug stores? Top 3 control 91% of the market. Grocery stores? Top 2 control over 75%. Glass bottles? Owens Illinois sells more than one in every two bottles in the world and has a near monopoly over the supply of glass containers in North and South America, Europe, China, and Australia. Although hit hard by the pandemic, recent mergers have left four airline carriers - American, United, Delta, and Southwest - with control over 80 percent of the market. This consolidation has greatly restricted competition at individual airports. At 40 of the 100 largest U.S. airports, a single airline controls a majority of the market, and at 93 of the 100 largest, one or two airlines control a majority of the market. From sanitary products to rental cars to diapers the largest players control more than 75% of their markets. They have no fear of raising prices. There isn't anyone to undercut them, and Anti-Trust enforcement is lacking. This is several years old but it is worse now www.openmarketsinstitute.org/learn/monopoly-by-the-numbers

[@whatthree16]

Pareto's Principle: originally 20% of Italian households controlled 80% of the land. Can be extended to 20% of airline companies control 80% of the market, 20% of airports handle 80% of the traffic, 20% of football players score 80% of touchdowns, etc. Trying to alter Pareto's principle to make every company the same is unnatural and will fail in the long run.

[@scpatl4now]

@@whatthree16 That makes absolutely no sense.

[@FlatKitten]

This is exactly why even if we are threatened with inflation we must demand better pay from employers and support unionization.

[@neeljavia2965]

@@FlatKitten Unions are corrupt and useless.

[@DrunkTalk]

@@neeljavia2965 you have no idea what you are even talking about.

[@olefella7561]

7 year old: Why don’t we just print more money? Governments: Genius 😊

[@Ryan-nn1kl]

Why do we have money.. and how has the way we've needed it changed since it's founding

[@dennisbernic5856]

Here I found the best comment, which actually explains it all - Bravo !

[@ryanosaurusrex963]

You are correct about the M1 money supply and it's calculation change. Could you do a video on the changes to how CPI is calculated? I have seen charts showing CPI as high as 15% if we used the same methodology as what was used in the 70s.

[@agent9184]

there's no specific explanation of how the CPI is calculated. they made a lot of substantial changes to the CPI in 1998 due to the recommendations of the boskin commission - which told the bureau of labor statistics that the CPI was "over stating inflation". They then introduced a lot of new formulas, weighting, and substitution for items in the CPI. That is the same CPI we use today

[@Razaiel]

The issue is that the CPI has always been fudged because the rate of inflation correlates with the interest to service the debt & payments to SS recipients.

[@boygenius538_8]

@@bisratbeyene3980 well food is pretty important

[@allthattastesgood]

@@bisratbeyene3980 US and Australian CPI both include food prices. Who's not including it?

[@zxwy37]

@@bisratbeyene3980 that's wrong. Food and energy is excluded in the measure called "core inflation" (because they are much more volatile than most goods, ex. Oil prices where negative in april 2020, then 1 year later they were over 60$ per barrel. In the long term, those fluctuations average out, but in the short term (over a few years), it makes sense to measure both overall inflation (including food and energy) and core inflation (excluding food and energy).

[@OopsFailedArt]

I love you’re approach this year. I know several KZbinrs in particular were trying to use your M1 mistakes as a way in to the top spot. This entire competition is a classy way to regain/retain trust without getting into the silly squabbles back and forth :)

[@jc.1191]

I found that video pretty cheap. He also made some unfounded claims, like his sp500 claims.

[@OopsFailedArt]

@@jc.1191 which video man? There were several with the M1 before a lot of people caught the fine print. Lots of media outlets were using it at the start too. It was a bad mistake but one a lot of people made sadly.

[@jc.1191]

@@OopsFailedArt You're right there's a bunch. And I don't remember the channel name. It was a Russian sounding guy iirc.

[@davidbarry6900]

3:20 "Economics is a rigorous science" - there's one of your mistakes right there.

[@ddandymann]

You may be on the wrong channel then mate.

[@tamberlame27]

@@ddandymann social sciences are not science

[@ddandymann]

@@tamberlame27 You mean they're not natural sciences, hence the name social science.

[@joshnabours9102]

Rather than just mistakes, it is even more important to point out ways that the video topic can be communicated in an even clearer way. There is a perfect example of one that you did exactly right in this video too. The fact that you provided a graph of the m1 money supply using the pre-2020 methodology made your point on how massively the change in methodology, which many non-economists such as myself were wholly unaware of, affected the m1 money supply chart 100,000 times clearer. I am sure there are many similar changes and standards regarding how economic data is collected and used that would essentially be unknown to non-economic viewers while it would be common knowledge for an economist to the point of taking it for granted as if it was obvious to all.

[@stephandimopoulos2367]

I struggled with Economics at uni. I struggle to keep up with everything you say in your videos, but for some reason i enjoy watching them lol

[@TheRexblisar]

The video is very well made. BUT the stock footage from 14:51 until 15:05 shows suicidal work practices. You don’t touch the fastenings of a lathe cutting steel when it’s running. That can and will kill you

[@rustydawgt]

Good catch, enjoy Sydney sailing mate

[@DaveSmith-cp5kj]

Not to mention long sleeves when working on a lathe. There was a video last year of a russian dude that got sucked into a lathe when his sleeve caught on one of the jaws, his body parts were flung across the shop floor and everything.

[@KingLarbear]

I'm sure that was shown as humor

[@UTKS]

Thanks for existing. While I'm more of a science guy watching your content makes me feel I love Economics equally if not more.

[@mikegofton1]

As a recently retired engineer who flys model planes, I endorse this video.

[@oLuii]

I need to take a moment to talk about the cashier scanning a pineapple at 12:31

[@standardtoaster10000]

The idea that a small amount of inflation is a good thing isn't as universally accepted as you made it out to be. The logic behind it assumes that everyone inherently has zero time-preference when in reality that isn't the case, but the idea is still pushed by governments and their preferred economists because its essentially a 2% tax on all cash which allows governments to spend more.

[@thewhitefalcon8539]

Holding money creates negative externalities (economic instability).

[@altrag]

There is very little that's "universally" accepted, especially in economics, but the idea that a low inflation rate is a good thing is very widely accepted. If money retains its value over time (or worse, it gets more valuable over time), people are less likely to spend it as they're accumulating (or at least not losing) wealth by holding onto it. That means there is less goods and services being purchased which in turn means someone else isn't making as much meaning they're purchasing less and so on and so on, eventually lowering the purchasing power of everyone. Economies don't run on money. They run on the _flow_ of money. That's one of the biggest problems in the US (and elsewhere) even before the pandemic - pushing more and more money to the top as has been the goal of American economic policy since at least Reagan means less and less of it gets used to buy goods and services - Jeff Bezos only needs so many superyachts even if he could technically afford to buy more. We end up with money just being parked in safe investments, offshore accounts and other economic locations where it accumulates interest but doesn't actually do anything for the rest of the economy. But ignoring the wealth gap issues, even among the money that's still available to the economy, the _flow_ is the important part. Having a positive inflation rate encourages that flow. Of course if that positive inflation rate gets too high you end up in a situation where people effectively need to spend money almost before they even have it in order to stay ahead of the devaluation. So its a pretty delicate balancing act - too low and the economy stalls, too high and the economy collapses. That said, 6% is nowhere near "too high". I mean obviously people prefer lower, but its hardly an end times scenario. Even hitting 15-20% is only "bad" and not "doomed". Its happened before and no, it wasn't fun, but it didn't destroy the country either. There is of course a cutoff. I'm not sure where that point lies. The stories we hear from the worst cases of hyperinflation tend to be on the order of thousands of percent per _day,_ and we're talking a couple dozen percent per _year_ in our worst-case scenarios. But such a point does exist, even in the US. We know from history that its somewhere over 20%, but beyond that its pure guessing. Lets hope it continues to just be guessing!

[@eurobrowarriormonk7182]

a lot of what is in this vid is wrong. spreading a few lies among somme truth is much more effective when fooling people.

[@altrag]

@@eurobrowarriormonk7182 Care to elaborate? Or just going to make an accusation without evidence? Certainly economics is complicated and even when things aren't "wrong" you can often find some economist somewhere who disagrees, but that's very different than explicitly lying as you've suggested. Making such an accusation without something to back it up mostly just makes you sound reactive, which in the modern world is frequently associated with being misinformed or even uninformed - "it doesn't fit my biases therefore its a lie!" So, please prove me wrong. It would be a nice change of pace among accusatory KZbin comments.

[@Da__goat]

Absolutely fantastic video. I got my degree in Economics and graduated in 2019. This kind of low interest rate plus Quantitative Easing has literally never been done before. But it is pretty easy to exploit that for profit and the distinct lack of economists to agree on anything is always hilarious. On a sidenote, would you possibly do an examination on the economic competitiveness of Greece? The country has really been struggling since its debt crisis 10 years ago but there are companies that are investing in the country, like Microsoft and TrenItalia, which seem strange to do so in an economic recession and an unstable political climate. Obviously this is just a suggestion and I have others: Russia, USA, Israel, Italy, Germany, Canada, Mexico. This isn't to do an analysis, but rather to see where these countries would rank on the EE leaderboard.

[@sonsautomotive]

I may wrong but qe and low interests began in 2008....but no inflation in 2008 as assets and real estate prices fell deeply along with 2 recessions

[@nathanielknight1838]

Isn't that exactly what the EU CB did? Massive QE and a 0% interest rate? And Greece is competitive and stable because it's in the EU. The rich EU countries have to bail it out and there are plenty incentives for EU citizens to move to Greece for possibly high paying tech jobs with low cost of living and just a beautiful landscape. Politically, Greece is also far from turmoil or anything really. I mean, they still have issues and all but to call it unstable is just... wrong.

[@tsioulak]

I will tell you why they set up some tech jobs in Greece, low wages for skilled labor, skilled and cheap labor when compared to countries like France and Germany. And right now the current government is in the process of destroying the few labor protections that survived the economic crisis. So they are trying to do what the proto romans did when they conquered the city states of the region of Greece, get highly educated slaves.

[@tonysu8860]

It's well known that Greece like many other countries with similar economic problems is saddled with high government employment followed by early retirement with extremely high retirement benefits. This causes a spiral of government obligations greatly exceeding taxable income which results in fewer government provided goods and services which then causes poor economic and social conditions especially regarding the formation and nurturing of new small businesses(which puts greater pressure on the government to do more) which in turn causes flight of its newly entering workforce who are able to find better opportunities only a few hundred miles away in another country. There is no likely solution for all countries like Greece(and Spain plus others) without literally declaring a national bankruptcy defaulting on its excessive obligations and rebuilding. It's too far in the hole it's dug to wait for all its retirees to die before starting over.

[@bevvy.bee9]

Where would the US rank on the leaderboard?

[@monjanger]

Another phenomenal video EE! Thank you for the clarification on the M1 money supply. One thing to consider is the US Dollar is the de facto global currency, reducing implications from continuing inflation. Still not a great solution, and inflation is apparent in the current market, but something else to consider.

[@agent9184]

I don't think the "reserve currency" just reduces implications from inflation - if anything it means the effects of inflation will be felt far and wide beyond the US economy since everyone else is also holding US dollars in their banks.

[@harryseaton7444]

@@agent9184 I think it's likely if inflation in usd was bad enough other countries would sell their fed notes back to the us fed, making inflation inside the us go fully out of control

[@Tazemi.]

I would rather see a new currency altogether that all countries adapts as the de facto global currency rather than the us dollar, sure, It will be hard to get even the majority of countries to agree but I still think that it will be far easier than if we would all adapt the US Dollar.

[@juch3]

@@Tazemi. Keynes be like: heyyyy

[@ArawnOfAnnwn]

@@Tazemi. Such a thing already exists - look up the IMF Special Drawing Rights. Unfortunately it's only used as a backup.

[@denniss3980]

For me I am holding off taking Social security to take full advantage of inflation adjustment plus the 7% for waiting a year brings my SS up 13%, if this repeats in 2022 I would be looking at a 25%+ increase just by waiting 2 years

[@bcshu2]

Meanwhile, cost of goods rise reducing overall gains.

[@middle_pickup]

I'm just a casual viewer of your channel, so I would obviously never win your contest. I have to say though, this was complete genius. You actually came up with a fun way for your most engaging viewers to add value to your channel, and get rewarded doing it. That's some big brain generosity. I'm kinda shook.

[@shaun2072]

The global experiment with zero percent interest rates has been one of the worst mistakes made in the history of modern economics. The resulting gross asset market distortions has exacerbated an increasingly divided society and may actually be chipping at the foundations of democracies.

[@ozzy5146]

Yep. All the renters will be fed up when they are screwed every which way.

[@freedomwatch3991]

@@ozzy5146 Actually, this is a problem caused by democracy. Democracy leads to short termism and there is no incentive to pursue long term sustainable policies because by that time the ball has been passed on to soneone else and its no longer the previous guys problem.

[@SisyphusJP]

@@freedomwatch3991 No joke Herodotus makes this argument from the perspective of Darius the great and the 7 families of Persia recounting the tale of deciding on what government to choose after the outing of Smurdus (the magian) The idea that people will only work for the short term in democracy is something ancients seem to have been aware of.

[@ozzy5146]

@@SisyphusJP Plato and Aristotle detested democracy.

[@DaveSmith-cp5kj]

@@SisyphusJP The funny part is that America never has been a democracy and it isn't even mentioned once in the constitution. Democracy is entirely a political concept gas lit by the media as being the mechanism of our country when it isn't. Voting isn't even a right in the Constitution, and it was done that way on purpose. States originally required one to be independent (own land, pay taxes) before you could vote as impoverished people are easy to bribe with free things by politiicans.

[@MediocrityInMotion]

If you have been to the grocery store recently you know the official inflation is not reflecting reality. My grocery bill is up 20-30%.

[@madcow3417]

Have you tried eating 20-30% less? Now your bill is the same as it was, inflation solved.

[@sprague49]

@@madcow3417 Exactly. It's not like we Americans are so thin that we can't risk losing a single calorie.

[@stapleman007]

@@madcow3417 Obesity: solved.

[@crafting1660]

@@madcow3417 I laughed, but we have been eating less.

[@fictionindianspaceprogram-222]

@@madcow3417 exactly what Republicans tell to the middle class.

[@Secret_Squirrel_Scottishgamer]

your competition thing is genius and I know the real reason why you are doing it.. the amount of views boost your going to get on old videos all the way through your channel will be phenomenal!.

[@scottash351]

And then they'll probably award the trip to a friend.

[@rightdirection55]

Inflation conditions are almost same in most of the countries and common people are paying the price. There is no doubt that the biased nexus between the policy-makers and corporate heavyweights is responsible for it and courtesy is of the pandemic. But one thing is obvious in near future that all governments will be in serious economic crunch unless they stop indulging corporate magnets and be strict with financial policies keeping it on a rational standpoint. Otherwise, entire global economy will reach a point of no return.

[@parkmannate4154]

Some of us "common people" actually like inflation because our home loans are getting cheaper and our salaries are tied by contract to cost of living

[@bcshu2]

@@parkmannate4154 Inflation is one of the most destructive societal forces available. Those ‘common folks’ that like inflation is merely short sightedness in action. Smoking, boy I like the immediate pleasures, is akin to this thinking in action.

[@parkmannate4154]

@@bcshu2 Spiraling hyperinflation sure. But inflation in general, nah. Having the economy grow 2-4% a year is broadly a good thing. And hard stopping inflation puts millions out of work; when Vockler threw the breaks on in the early 80s in the US it pushed Unemployment up over 10%. You really think that's better than the 3-4% underlying inflation we're at right now?

[@bcshu2]

@@parkmannate4154 changing goalposts

[@parkmannate4154]

@@bcshu2 Were you not arguing "inflation is one of the worst societal ills" or not?

[@IndigoVagrant]

I placed a preorder for a Toyota Rav4 Hybrid 7 months ago and just got it. They didn't increase the price at all, and they didn't markup the price from the 2021 price. Toyota and that dealership were very fair in my opinion. The only price difference I paid was for the 2022 model(the preorder was original for the 2021 model), which was not a significant increase(I think around $400). The 2022 model also has some small differences that easily justified some of the price increase. So new cars, as he said, do tend to have sticky prices. Used cars on the other hand are a whole different beast, are very much subject to commodity value instability.

[@kskaiseraaron]

Keep up the good luck. Your videos 9 years ago inspired me to major in Economics and as a result I'm doing great. I will say it has been funny observing the change in your tone towards the establishment Economic policy-makers as the year went on and they continued doing things that made zero Economic sense and then claimed ignorance when what any econ 101 major could have predicted. You do great work and I love your channel.

[@nekomakhea9440]

The "money printer go brrr" graph only goes back to 2011, there was a lot of "money printer go brrr" in 2008 too. Also, it's not like there's anything to prevent the graph from being corrected for the inclusion of savings, either by including savings retroactively for every year, or by showing a graph that excludes savings for every year.

[@dpie4859]

No. QE is not money printing. Check with Lacy Hunt or Jeff Snider or Steven Van Metre.

[@fabionaps]

@@dpie4859 it’s not money printing but it puts money into peoples hands...so what’s the difference? I too listened to those 3 idiots and watched everything go up

[@sivi9741]

@@dpie4859 It isn’t money printing if u believe the fed balance sheet will go back down into the real economy . Good luck with that …. There is no way over 7 trillions of treasuries and MBS will be sale back anytime soon . So if the government always borrowed money without ever have to pay back the fed (holding treasuries ) , what you think it means ? -> printing free money ….

[@BikeHelmetMk2]

That's what EE's second graph showed - it was corrected to include savings. No giant jump. Just a scary steep mountain shape.

[@DaveSmith-cp5kj]

@@dpie4859 That kind of logic is like claiming you aren't spending money if you use a credit card instead of cash. QE means money printing will have to be done later on down line.

[@quintessenceSL]

Something I've been mulling over isn't exactly inflation per se, but when you have wealth inequality so extreme the rich can price everyone else out of a market (especially housing). Inflation really doesn't describe what is happening, as prices will stabilize, just at a point where only the 1% can afford it. There not even a good term for it that I've seen.

[@kevinstfort]

This ☝🏾

[@imnotracistbut-9559]

I feel like what you’ve described is what people have been calling “economic justice” or “build back better” or something equally stupid and transparently a wealth transfer that allows the sociopaths in power to really kick things up a notch in terms of creating a neo-feudalist economy but on a global scale. I trust them though. They definitely seem like the good guys. CNN told me so

[@liamhodgson]

Oligarchy capitalism?

[@quintessenceSL]

@@imnotracistbut-9559 And yet when the wealth transfer is workers demanding more pay, it is a crisis that could topple the economy. Your slip is showing.

[@Nostradevus1]

@@liamhodgson Can you explain what tenets of Capitalism support a government taxing citizens, so it can direct funds to its corporate supporters? There are only two modern economic systems that support redistribution of wealth, Communism and Socialism. Even these are not supposed to redistribute unequally, but in practice they do. If anything, what we are seeing is a neo-feudalism, where the 1% (modern day aristocracy) own everything and rent things to the peasants as long as they can generate a return profit. The only difference is instead of paying the aristocracy in goods produced we pay in fiat currency.

[@iantaz]

Really disappointed on how the FED also manipulates the CPI compared to previous comparisons. Not including all the metrics of past comparisons doesn't give people fair measurement of prior performance.

[@muhammadhafizudinidris1592]

Its not CPI, its CPLies... This is the prob of excessive money printing issue that caused by monetary that not backed by gold

[@bonzaion21]

That's the point.

[@agent9184]

the fed doesn't release the CPI - the bureau of labor statistics does - which the fed then uses. they made a lot of substantial changes to the CPI in 1998 due to the recommendations of the boskin commission - which told them that the CPI was "over stating inflation". They introduced a lot of new formulas, and weighting, and substitution for items in the CPI.

[@finxy3500]

14:33 Mistake: By your definitions the unemployment rate does not have the working age population as a denominator, which is what your pie chart is representing. 4.2% represents the unemployed/(unemployed+employed) meaning that: {for every (100-4.2)=95.8 employed people there are 4.2 unemployed people} = {for every employed person there are ~0.04384 unemployed people}. Multiplying this by the percentage of employed people we get: 59.2%*0.04384≈2.6% which should be the proportion of the unemployed to the working age population.

[@matthewparker9276]

Milk has relatively sticky prices in Australia, though was much more sticky a couple of years ago. The major supermarkets spent a lot of advertising selling milk at $1 a litre, so that price wasn't raised with other prices. Until the dairy industry made a lot of noise about how little they were being paid, and the supermarkets were forced to negotiate a price raise, but the milk prices still rise relatively slowly.

[@HalOBrien]

_"Milk has relatively sticky prices..."_ I see what you did there.

[@The_Angry_BeEconomist]

"The current understanding of the word inflation is contrasted with its earlier meanings by Bryan, who states that “[f]or many years, the word inflation was not a statement about prices but a condition of paper money - a specific description of a monetary policy. Today, inflation is synonymous with a rise in prices, and its connection to money is often overlooked” (Bryan, 1997: 1). Bryan also states that “[w]hat was once a word that described a monetary cause now describes a price outcome. This shift in meaning has complicated the position of anti-inflation advocates. As a condition of the money stock, an inflating currency has but one origin - the central bank - and one solution - a less expansive money growth rate. But as a condition of the price level, which may have originated from a variety of things … the solution to - and the prudence of - eliminating inflation is much less clear” Bryan, M. F. 1997. On the origin and evolution of the word inflation. Economic Commentary. Federal Reserve Bank of Cleveland. 15 October

[@sprinkle61]

Fractional reserve banking also increases the effective money supply, but that only happens when other banks lend money. Yes, the Fed can limit this with reserve requirements, but even so, there are two distinct sources of new money supply, so even the increase in money stock is not as simple as just blaming the Fed, although that certainly is the source of our current money surplus.

[@The_Angry_BeEconomist]

@@sprinkle61 the point is that CPI is not inflation...

[@fitnesspoint2006]

it was not that funny, we all know economists are stupid people in general

[@mattja52]

@@The_Angry_BeEconomist The CPI is actual the consumer price lie, it excludes goods that they define as high volatility, such as food and energy. George Orwell said, "There are some ideas so absurd that only an intellectual could believe them." You're correct, the CPI is not inflation, it measures the level of inflation in an economy

[@The_Angry_BeEconomist]

@@mattja52 CPI does nothing to measure inflation in an economy.

[@parazitul1986]

I really would appreciate if you made a video about inflation in other places than the US. I've seen a lot of videos about this, but none about inflation in other parts of the world. I'm curious especially about Europe

[@brianjanssens8020]

You dont need a video, i'm just gonna give you a short summary of that topic: Europe is basically fucked

[@noahway13]

@@brianjanssens8020 I'm no legit, degreed economist, but the whole world seems to be headed for a crash. (Being fucked) I have not seen a nation that is not dealing with major issues like Europe, US, China, etc, and even if there is a healthy country, it can't escape the globalization issue. We are all in this together. Can someone tell me why I'm wrong? I am getting worried and would REALLY like to know why I'm wrong.

[@Wjv-ev4ez]

@@noahway13 America is actually in a much better spot than most of the world. Americas industrial infrastructure was already quite robust and was getting much better pre-pandemic. Only something like 10% of our economy is import reliant. A troublesome number but not something we can't live without (as opposed to the UKs 50% for comparison) and what we do need to outsource we can do with Mexico through NAFTA and their workforce is perfectly suited for exporting industry. As for our demographics most of the world's boomers were content not having children except for America's who had a major spike compared to other countries (the millenials) this allows our workforce to bolster the retiring boomers. It won't be easy but america is in a better spot to do it than Europe and especially China (they're both probably fucked though). Because of this the only real safe haven for capital will end up being the US, so investments should and probably will flee places like China. If the US can drag itself through a few more hardships relatively intact it'll be sitting pretty, or well sitting relatively pretty on the world stage

[@noahway13]

@@Wjv-ev4ez Wow. You should do a video. Seriously.

[@Wjv-ev4ez]

@@noahway13 Peter Zeihan has written a lot about this. I've basically just ripped off his words for this comment. I don't agree with 100% of what he says (too blackpilled for me lol) but hes still a great resource. Thanks

[@mariannerichard1321]

About the lower employment rate in this pandemic, there is the early retirees, but there's also parents who both don't have kind of skills to work remotely, but still need to be able to get the kids back home for weeks at a few hours notice, because their kid(s)' class was close again because covid. In these cases, it's easier to just have one of the spouse quite work entirely. In the United States particullary, there's also the hundreds of thousands of deads, most older people, who could have the same profil as your father, but they're six feet under instead of flying model planes.

[@raghuvenkatesan6792]

Hopefully the birth rate falls lower

[@DrunkTalk]

Lots of parents have not rejoined the work force because child care is in short supply and inconsistent considering the state of the pandemic. I chose to go back to school and parent full time. Its that or give my entire wage to child care and still end up getting fired when I inevitably miss work because the day care is closed due to an outbreak. Same can easily apply to school age children.

[@TheMagicJIZZ]

@@raghuvenkatesan6792 not in the west.

[@raghuvenkatesan6792]

@@TheMagicJIZZ hopefully it does bc feminism has failed

[@Carahan]

And several times that hundreds of thousands of dead are now disabled due to surviving COVID and long COVID. Which, depending on their skills, locks them out of full employment into part-time, underemployed, and disability.

[@ellieban]

Gotta say, your predictions make a hella lot more sense than most mainstream economists!

[@josuejasso7589]

Videos like this need to be watched twice. Once to soak it all in and then to understand it

[@kamalsaurinsagar]

I love your channel. I'm from India 🇮🇳 Though "UPI" system is not an economical concept. I'd love if you create a video regarding that and how it impacts payments system. Bless you😃👍

[@IKEMENOsakaman]

My local economy has been a mess since the beginning of 2010s. Department stores closing, younger kids not being able to find good jobs... and then COVID!

[@Fauzanarief-n7i]

are you live in osaka japan? what happen in there?

[@dastomde1529]

We you from?

[@paranoiaproductions1221]

My local economy has a been a wreck since the 90s, due to a loss of high paying jobs. Thankfully COVID barely had any impact on the economic base of my home town and the surrounding areas, since we don't rely on service jobs.

[@Newbmann]

@@Fauzanarief-n7i I know japan has been stagnent since the 90s outside of there entertainment sector. With osaka being one of the 2 big cities to lead the entertainment sector It shouldnt have been as bad as the rest of japan with there manufacturing stagnation and housing issues.

[@user-hv6wb5gk8p]

@@Newbmann The entertainment industry is surprisingly small. Video games have become the biggest sector in the industry and the entire global gaming industry is worth less than tomatoes alone. There are over 80 individual companies that are bigger than the entire global video game industry. I doubt a small part of that is enough to save the economy of a metropolis.

[@SomeGuy1117]

I get how theoretically full employment would increase inflation through people having more negotiating power and by unlocking a lot of the money that corporations keep for their shareholders for the public. I just don't see how its a bad thing. The inflation would be in the common person's benefit as it would simultaneously prevent corporate hoarding and encourage personal spending. This would speed up the economy immensely which is a pretty good thing.

[@Mrdysfuntional100]

Until grandma and grandpa have to work again because their 401k started to turn red for over a year and the money ran out.

[@SomeGuy1117]

@@Mrdysfuntional100 Not really. By raising the velocity of money company revenue would increase substantially. This would contribute to raised stocks prices. Even if it doesn't, as things stand now plenty of older people have to work anyway. Now their jobs would combine with their social security benefits which would lead to those working needing to work less than they already need too anyway.

[@neeljavia2965]

That would be a problem when there is not production.

[@SomeGuy1117]

@@neeljavia2965 In full employment everyone is working. By definition there must be production. Or at least some other kind of useful labor. This would actually raise supply substantially which would act to slow an increase in prices which would not just mean people are getting funny money but in real terms are getting richer.

[@neeljavia2965]

@@SomeGuy1117 That only happens in theory. Not in real life. Full employment doesn't guarantee production. Especially in this age of automation and ai where full employment means unproductive labour.

[@ElliottA7]

Y'all... a competition in which participants have to follow a link posted in the video, WATCH all of the channel's videos, and possibly engage in the comments, is a blatant attempt to boost engagement. Which, it seems, they've managed anyway, since i'm writing a comment. Well done good sirs.

[@tsvetankunchev4477]

For 5 days to check out 100 videos and write in a spreadsheet is quite a bit of a challenge for the holidays... Though the approach is admirable!

[@xXKyledkXx]

Well that's one way to boost views and traffic to old videos, and get content for the next. Clever

[@ne0tic]

Thanks a lot for this video man! The unemployment vs employment way of measuring is especially useful to know.

[@illusive-mike]

The part of this video that deals with the exodus of experienced workers sure reminds me of the video about FIRE and how it wasn't that bad for the economy because the practitioners would still have a positive impact through their capital. And given that the whole idea is to save up enough money from work to become financially independent through investment and that only highly skilled in-demand workers can really pull the kind of salaries that allow them to save up like that...

[@Georgije2]

I guess all the FIRE people have contributed to the overinflated stock market. Once stocks crash, many of them will have to rejoin the workforce.

[@mykeprior3436]

@@Georgije2 but they won't so....unless you count this minor hilarious pebble of a speed bump. If anything it will get worse, just wait til earnings Q1.

[@ruisen2000]

The problem with FIRE is that the vast majority of people end up losing money in the stock market. Having enough capital to implement FIRE doesn't mean you can actually do it, because good investors are rare. Also, every extended stock market boom in history has led to everyone trying to live off the free money from the market, until the bubble pops and everyone swears off stocks for the next decade.

[@joecurran2811]

@@ruisen2000 Just use an index tracker.

[@MLDeS100]

Ooh public engagement and peer review in one go. What an excellent contest!

[@harryobriensmith40]

Even though I already live in Australia, I'm gunning to win this just for the chance to meet you. Your channel is what got me into studying macro-economics

[@suu566]

"The fed still operates for the benefit of the people" best joke i've heard so far this year.

[@RoseHayes-321]

Let's be clear, low inflation for the past 3+ decades is closely correlated with wage stagnation (specifically with breaking the link between productivity increases and real wage increases). The top ten percent of earners has been hoarding the bulk of the benefits of productivity increases. Nobody wants 1970s inflation, but the price we've paid for that is being paid by those with the least capacity to do so.

[@gtw4546]

The 1970s was STAGFLATION. I lived through it as an adolescent when my father's employment situation became tentative at best (layoffs galore) combined with inflation (and toss in gas rationing into the mix). In stagflation, you can add middle-class people to the already struggling category of "those with the least capacity to do so." It was far worse than any experience of normal inflation can prepare you to imagine. Sadly, attempts to "pull up" the bottom tier of earners by increasing minimum wage merely increases suffering for all but the top tier (and may even have helped those amass more wealth by the stored value of being able to afford real assets).

[@user-ls4cs1wd2w]

@@gtw4546 you're right, let's make an UBI

[@gtw4546]

@@user-ls4cs1wd2w I'm sceptical of UBI. Experiments began in the 1970s. Results vary but funding seems to be the major problem. If it's tied to GDP as I've heard some propose, what happens in a contracting economy when GDP goes down? As the old saying goes, "there is no free lunch." There is always a cost, however hidden. I suspect young people suffer most from the GOOD intentions of previous generations because each tries to solve known problems and don't see the hidden evils imbedded in their solutions.

[@user-ls4cs1wd2w]

@@gtw4546 Although there are concerns over funding, it could be more than compensated by lower regulations and bureaucracy across the labour market, don't you think? Also, there's things like the military budget that could be reasonably lowered. The amount needs not be large, even a tiny UBI can give workers more power without the distortions of things like the minimum wage

[@gtw4546]

@@user-ls4cs1wd2w Again, I'm skeptical. Minimum wage was originally proposed as a small baseline for unskilled work. Now people want the minimum to be "livable wages" even when the only skill set is provided by employer training. All MW did was make people with skills demand higher wages, causing employers to bump up everyone and increase prices to cover the extra labor costs. It's a vicious cycle of boosting the minimum, adjusting everyone else, then increasing prices to cover creating inflation, and REPEAT. I think the same thing happened with social security to eliviate elder care burden on their children. People thought the government would be investing the money they paid into the system, but it turned into a slush fund and has become a big Ponzi scheme. I'd never count on a reduction in government waste or cutting other programs to fund UBI. UBI sounds like a nice idea. I WISH it could work. But it's like a fairy tale about a magic purse that never runs out of money - nice to dream about but completely unrealistic because of human nature.

[@charliec9839]

I have a qustion, higher inflation would (effectivly) reduce the savings of retirees, because of this, wouldn't more retired people return to work? (Obviously there are many many downsides of this but it was an interesting thing I was wondering about)

[@allthattastesgood]

The retirees with enough cash saved up to be significantly affected by inflation probably are getting richer off rising property prices.

[@derrekvanee4567]

That's interesting to think about . however it takes money to make money. Those Granny hollaback gurlz can just buy beetkoinz and double retire next bull run.

[@jackmccarthy4047]

A lot of retirees have their money in the stock market which has outpaced inflation

[@Nishith8]

Their value of income will decrease yes. But retirees have a corpus of fund which is diversified across investments. The stock market experiencing a bull run means their corpus of retirement grew faster than they expected, even faster than inflation and fast enough that they can finally retire. Meanwhile middle aged people in their 30s and 40s, who don't have a money corpus, whose salary hasn't increased are most affected by this inflation.

[@TheMarrethiel]

I tried to get my retired mother to take he money out of saving and into the stock market (and failed), I do believe it is an issue as she is getting negative real interest rates.

[@scottanderson691]

You left out one very important group when describing the demographics of the employment rate group; people who are no longer actively seeking employment (i.e: those that have given up). And there's a lot of indicators showing this to be a significant portion of this figure.

[@webyugioh]

I think a video on the effect on economies when there is a sudden loss of population like with COVID (past wars, etc) would be super interesting

[@CalCaliente]

We are past the point of no return… we can’t raise interest rates past 2% without the entire stock market collapsing. But in order to lower inflation you need to raise interest rates about rate of inflation (7%) it’s either hyperinflation or MASSIVE economic depression that’s it

[@QueensNativeNYC]

Exactly,. 100 percent spot on and this the painful fact that nobody wants to address.. For the last several decades the fed has always been able to print its way out of trouble during an economic downturn.. But now it's all coming to a head.. The fed is going to have to raise rates to combat inflation and let the economy and the markets implode.. The can has been kicked down the road for too long and now the day of reckoning has come, for the fed can't fight inflation and support the economy at the same time..

[@Voidapparate]

@@QueensNativeNYC When do you think everything will collapse, I want to prepare?

[@QueensNativeNYC]

I don't know exactly when it will all collapse.. Could they keep everything afloat for another year or two, Maybe but I wouldn't count on that.. It would be wise to have a backup plan, first and foremost is to get at least a 6 month supply of food and water should things get really bad.. This is absolutely the most crucial thing.. Second is a weapon to protect you and your family and your property should things really get bad.. If you have any extra cash to buy gold or silver that would be a great way to preserve your wealth.. I'm not saying cash out everything you own and buy gold or though that may not be a bad idea.. I would say say the time is getting close and the sooner you start preparing the better.. The entire globe is in uncharted territory due to the pandemic with record debt levels never seen before, it only takes a little bit of reasoning and common sense to realize this is not going to end well.. But most are blind to see that and therefore just assume everything will go on as business as usual..

[@CalCaliente]

@@QueensNativeNYC most people are in the “system” with mortgages, pensions etc. So no matter how much data you show them that this is all one big Ponzi scheme they will not listen. Because they have a interest in seeing the system continue. We will not get some nice warning like gold going up ten percent a year. It will be a VIOLENT explosion in the gold price and if you don’t have any food and metals you will be fucked.

[@sivi9741]

@@QueensNativeNYC Calm down . Yes inflation will persist but there is like 1% chance the US suffer hyperinflation or very high inflation …. The US have massive ressources and strong potential of producing stuff ( like they did in the 1940-50). If all ressources prices goes too high , old jobs like manufacturing and farming will come back because it will be profitable again to actually produce stuff in the 🇺🇸… Inflation is just the currency value going down . So as your purchasing power diminished it just need you actually have to works to buy basic goods .

[@Dara-ih6jq]

More people died from Covid in both world wars combined is very true but the people that died are mostly old and probably not contributing much I’m not trying to sound coldhearted anything but if we’re talking in terms of contributing members of society it’s probably alleviated more than it has put stress on society. Because the vast majority of people who died from Covid were over 65. I’d so complicated but there most definitely is a very big glass half full outlook. Because most successful western nations look like upside down pyramids so if you can alleviate the aging population off the backs of the younger population then maybe it’s not so completely a negative thing in terms of economics it’s definitely a negative on so many levels but economically maybe not so bad.

[@Stargate2077]

Economics Explained, you do not replace a 50 or 60 year old executive with a 20 year old. That is a straw man argument. They would be replaced by a 40 year old. You are not losing much experience if they have been properly training their successor. If they are not training the new person over multiple years, then maybe that business shouldn’t survive.

[@ddandymann]

And that 40 year old will be replaced by a 28 year old, meaning that the loss of experience and expertise will be carried through the company, that's the point he was making. It's not a strawman argument he's just assuming that the viewers don't need handholding to work out the rest, I found it easy enough to understand.

[@Voidapparate]

@@ddandymann The lower you get in the hierarchy the less experience is needed, so it might not have as much of an effect as we think.

[@DaveSmith-cp5kj]

You are assuming a senior worker would be motivated to train their replacement, or that a 40 year old has the same experience and value as someone who has decades more experience over them. He didn't make a strawman argument, you did.

[@SkiwiGaming]

9:25 You forgot to mention that in the current high inflationary environment, bonds would be a bad asset class because inflation erodes the value of fixed-income investments. a.k.a. it's not just historically low interest rates which deter investors from bonds in the current macro-economic environment, but also high inflation and the threat of hyper inflation.

[@DaveSmith-cp5kj]

Yup. TBH ever since FDR broke the gold standard, anyone who would buy government bonds is beyond me. The government clearly shows an intention of increasing its spending and not paying any of its debts back, so any financial trust in the government is as dumb as a bank opening a loan to a drug/gambling addict.

[@altrag]

@@DaveSmith-cp5kj That's.. not how bonds work though. Barring the government completely collapsing, they will _always_ pay your bond out. Ensuring that bonds are a guaranteed (if low-interest) investment is of utmost importance to them and they'll borrow the money from elsewhere to pay you back if they have to. Paying back their bonds is one of the top priorities. That said, interest rate does have to be larger than inflation for people to want to buy bonds in the first place, but that's actually a good thing for the government. Setting the bond interest rate gives the fed another lever to help steer the economy, and the more levers that are available the better chance they'll have of averting outright catastrophe when things start going sour. Its one of the main reasons why the gold standard had to be abandoned - it provided almost no levers to correct the economy (gold doesn't just magically appear when you need it) and allowed the economy to fluctuate wildly and often disastrously and there was nothing anybody could do about it except hope the miners were lucky that year.

[@DaveSmith-cp5kj]

@@altrag There has never been a single case in history where the Fed has avoided an economic catastrophe. In fact, every single economic downturn has been attributed primarily due to the feds actions leading to unintended consequences when they lose the "pulse" on the economy. Sure the gold standard was abandoned because there weren't any levers... the problem is the lever the government wanted was one to buy things they could not afford. I mean that's like someone saying I could always be rich if only I could order money whenever I wanted.

[@ZeHydra]

@@DaveSmith-cp5kj "There has never been a single case in history where the Fed has avoided an economic catastrophe. " 2020 called. Covid lockdowns economic catastrophe would like a word. Reversed by feds decisions.

[@peasant_shots]

@@ZeHydra Delayed, but we have yet to see what the long-term impact of the massive relief efforts of 2020. I dearly hope not, but we could definitely still see massive inflation and a secondary economic crisis from this.

[@perrybrad]

Another great video, per usual! Thank you for all the awesome content over 2021.

[@davidbenger2396]

We seem to have a truly astonishing capacity to find an endless series of excuses to keep interest rates at historic lows

[@divinecomedian2]

The lie perpetuates

[@elektra2]

So is it safe to assume that most items that have gone up in price in recent times will stay the higher price indefinitely?

[@andrewdeda]

Yes. It's called Ratchet Effect. In global scale most of the economic processes very difficult to reverse.

[@tonysu8860]

There's no certain answer to that. There are a number of reasons why prices would stay high, but there are also reasons why prices may decline. What actually happens will likely depend on numerous factors, the specifics and the duration at the higher level. To anyone who claims that prices always rise on everything, I would point out the biggest example that touches everyone today in practically everything they do... computing technology. Since very early, there has been what is known as Moore's Law since 1965 which states that computing power doubles every 2 years, essentially becoming only half as expensive every 2 years for the same capability. And, that's brand new stuff, not depreciation. Is why your smartphone packs vastly more computing power than what was used to design and calculate space travel in the 1960's.

[@JoelBondurant]

Transitory inflation is forever. 70% monetary inflation doesn't deflate prices by being followed by a year of 40% monetary inflation.

[@xrpcryptodad8929]

I am so greatful for another great year of your hard work to keep us up.to date

[@mahmoodiqbalch]

Can you make a video on currency store value like gold has a set value and paper printing is virtually limitless and how that can possibly mpact productivity or change the dynamics of economics? Dig deeper! Really grateful for your channel 🙏

[@TheContrarian09]

The only real issue I found in this video was you showing airlines during the inflated stock market part. Almost all airline stocks are down for the year and for the 5 year charts.

[@CrypticFoxGaming]

How does the employment percentage treat self employed people and gig workers? Are content creators for example considered “employed” or do they fall in the 41% who aren’t looking for work, but are also not “employed”?

[@parrjj01]

Taxes. i.e if people are paying social security, Medicare, etc

[@CrypticFoxGaming]

@@parrjj01 they count anyone paying taxes in the employed percentage?

[@comradeofthebalance3147]

Maybe You can check the Fed Unemployment rates to see

[@JerkandDork]

@@CrypticFoxGaming Anyone paying labour income tax, which would include content creators like EE (if he worked in American obviously).

[@icypeanutpolo]

Can you please cover what’s going on in Turkey? Very curious about what’s happening over there!

[@Hacker559CoD]

YES

[@mam0lechinookclan607]

Erdogan being an absolute buffoon.

[@mam0lechinookclan607]

That's of course not all of it, but pretty much the core of the situation.

[@abuzainabahmadsyakirnorazli]

not to pointing mistake here but just wanted to tell you and all of your team that I loved all of ur videoes. It helps me understand the real economics outside the class's lessons since Im currently just an amatuer to explore this course in my postgraduate level which is not my core courses in undergraduate. keep up the good work!

[@FriedPlacentaBurger]

I’m curious as to EE’s thoughts on the hike in Overnight Reverse Repurchase Agreements doing a vertical line over the course of 2021. And the possibility of the GME stock being a time bomb due to aggressive short-selling, and hiding of short interest in long dated calls and puts.

[@johnjdumas]

Marketable production keeps inflation down. Aside from supply increase, the other side is the dollar itself can buy more goods therefore the dollar is more valuable. However, printing more dollars means other values can buy more dollars. I think it is good to look at supply-side from its inverse which if the supply-side is true then its inverse must also be true and can show situations more clearly. So, we can see that US inflation is masking inflation in other countries that are also printing more than they are Marketably Producing. I estimate a 25% real catch-up in inflation when the effect of simultaneous inflation is removed. This may also account for irregular price increases among diverse goods.

[@TheNexCat]

Thanks for the video! Can we have the same kind of analysis of the EU zone and the rest of the world? If USD gets inflated, that doesn’t mean that EUR/GBP does

[@glowingfatedie]

Well, eurozone buyers still have to compete for the same commodities. Cost-push inflation, as opposed to demand-pull inflation, affects all currencies more or less equally.

[@ed.puckett]

Thank you! I just found your channel and I'm enjoying it very much!

[@James-mw7zv]

Keeping rate super low devalues savings. Savers are penalized for being fiscally responsible.

[@102nickplays]

People always mention retirees being a problem for the labor shortage. 100s of thousands of people died as well. Those people aren't ever going back to work, and while we don't yet know the real number because the pandemic isn't over yet, I believe it comes close to matching the number of people who retired. So the employment rate likely won't return back to normal until we either allow more immigrants in, or produce more laborers. Meaning inflation will stay high for a while longer.

[@4777hamza]

more immigrants don't guarantee wealth inequality to be fixed...

[@Nukestarmaster]

The number of people who died is actually very small compared to the total population, and the vast majority of the deaths were people who were already retired for decades.

[@FajitaBurger]

I would be surprised if even 50k people employed in 2019 died from covid But if you have a src indicating otherwise I'd love to see it

[@102nickplays]

@@Nukestarmaster doing a quick search i see around 200k people under 65 died in the US since the beginning due to covid. And thats not counting the deaths not directly caused by it, like people not being able to get seen in hospitals. The actual number will be higher.

[@102nickplays]

@@4777hamza not talking about inequality here, just about how to bring inflation back down

[@michaelmemory6938]

It feels weird and slightly nerve wracking to know you’re living through a time that will be looked at as a case study for economists and historians of crisis handling.

[@svchineeljunk-riggedschoon4038]

Mistake #1: No one wants to come to Australia given the current situation there. I heard it was not possible to enter currently anyway.

[@PierSilver]

Ssssh that's in the fine print

[@lamer5799]

Oh yeah, I would be sent right to one of their camps.

[@ChineseKiwi]

@@lamer5799 Yet another American who believes Joe Rogan and Fox News are good sources. 1) the "camps" were for those coming into the country only 2) we don't need them anymore 3) we only wanted them as we tried hotels with predictable results 4) Florida has a similar population but **60 times** the deaths 5) Canada had similar arrangements but they aren't tin foil flavour of the month.

[@Echidna23Gaming]

@@ChineseKiwi Comparing similar populations for a virus makes no sense unless the population densities are comparable. Which is certainly not the case when comparing Florida (66k Square miles) to Australia (7.7mil square miles)

[@ChineseKiwi]

@@Echidna23Gaming yes, which is why you compare urban areas and not the average across the entire area as 95%+ of Australia is not inhabited by anyone ;) Enter 20c to try again.

[@wesch6354]

Okay. Maybe you should make a video explaining how it is possible for prices for goods to have consistently gone up ever since 2008-09 but yet inflation has stayed mostly level? That just does not make sense.

[@amhedinger]

Good idea having a bunch of people rewatch all your videos for mistakes to bump up the view count

[@blueboytv9191]

Add the high level of student debt and low birth rates, over the next couple of years, the US economy is going to struggle over the next couple of years

[@cavelord69]

"The fed still works for the benefit of the people" lol

[@tiberius3825]

“The FED operates for the best interest of the people” 😂

[@NovaRuner]

Let me add my story to this. I am not EE senior. I am a young 30 something Canadian. Before COVID I worked at Tim Hortons, a retail restaurant. When the pandemic started in march 2020 I was laid off for a month or so then my manager called me back to work. So I keep working for another year business as normal until march of 2021 when I am laid off again, manager kept saying she would call me back in just another week, just another month, yet almost a year later and no work no fallow up. Apparently they don’t feel they need me. That might be just my story, my personal experience, but still it may be a symptom of the larger economic situation. Anyway. Awesome video.

[@DaveSmith-cp5kj]

It's the same in America, although this has gone on longer because when Obamacare was enacted, having a long term employee became a liability, so people were hired and let go repeatedly. Trump then stopped obamacare which brought back stability to the job market but then it resumed when states started doing shutdowns and frivolous "essential business" arbitrations.

[@NovaRuner]

@@DaveSmith-cp5kj thanks for your insight on the American perspective. Happy new. And I wish you luck.

[@friggindoc]

Nice job getting people bingewatching your old videos...

[@patrikstreng6834]

There seems to be a general misunderstanding among the people on what inflation is. It is by definition a process of increasing the money supply which we see as an increase in the overall price level. Cost-push, demand-pull and price levels are SIDE EFFECTS of inflation, not causes. This can be seen easily if we compare some data. For instance, compare the M2 supply with the consumer price index and you'll see that they go hand in hand. Compare the purchasing power of the dollar with the M2 and they are the inverse of each other. Compare the CPI with the quantity of money per unit of output and you'll see a 1:1 scale. Inflation is much more complicated than simply saying "a rise in the price level". When you add more money to the economy, the purchasing power drops and prices subsequently increase. OPEC countries restricting the supply and pricing the oil really expensive does NOT cause "inflation", it simply increases the price.

[@patrikstreng6834]

@UCtNdiN7_NDZEs6bR_Ao1PpA It isn't in a dictionary. Again, there is no wage inflation and lack of supply inflation. "Wage inflation" is a result of a much larger process which all depends on the money supply. Supply shortages do not cause "inflation" even though they might cause a local rise in prices.

[@mehrshadvr4]

Not to mention adding money to the economy doesn't cause inflation on its own. You can look at Japan. You also need to look at velocity of money. That's the one that can really cause inflation if supply can't keep up. If money supply and currency devaluation because of printing was the main cause, you would see price increase on everything and not just a few goods.

[@tonysu8860]

I would disagree with your definition and description although I've heard it before. Fundamental to your argument is that it's the availability of currency that enables buyers to accept higher prices for desired goods and services. This suggests that suppliers will charge prices simply because they can, and is exclusive of any competition to provide that product or an adequate supply of product in the marketplace where supply and demand forces are in balance or even biased the other way. Your definition requires either a conspiracy or oligopolism on the part of suppliers to force willing buyers to pay higher prices only because they have no choice. Note though that your theory is not far off from what I described in another comment about a requirement of psychological compulsion and expectations that drives true inflation and is different than what is caused by supply and demand. The difference is that if there is a conspiracy or similar, that could be deemed illegal and dealt with. If instead there is a mass hysteria of expecting rising prices that drives everyone to raise prices, there's nothing illegal about that.

[@steviewonder417]

Increases in money supply don’t necessarily lead to increases in price level. Also the cost of credit drives up the price level directly. In an economy where the currency is floating exchange the purchasing power of a single unit goes down but the total purchasing power of all the units grows in tandem with what is for sale in that currency.

[@rightwingsafetysquad9872]

English is not a defined language like French or Spanish. Definitions in English are reverse engineered from how people actually use words. A super majority of people axiomatically cannot use a word incorrectly, by using it that way, they make the dictionary definition incorrect. And almost no one actually uses that definition of inflation. When people say inflation, they mean prices increasing.

[@kairon156]

Congrats on EE senior for retiring. It's odd that there have been worries about older people not being able to retire thus making it tough for 30 somethings to get promoted but now that they can retire their still at fault some how. That's just not fair.

[@crimsonking6773]

I would be interested to see how covid and our social, political, and economic response, and the outcome of that response compares to the people who dealt with the Spanish flu pandemic.

[@demilishing]

One of your best videos yet, not sure if I could disagree with anything! Goodluck to the poor unfortunately soul who spends 100+ hours on finding mistakes and doesn't end up winning the competition, someone will put even more time and effort.

[@AnitaCorbett]

You and your informative program are welcomed by me and I always appreciate you making sense of what you perceive for me

[@PleiadesChannel]

"The fed still operates for the benefit of the people." Found the error.

[@aathilahmed9973]

"Inflation is always and everywhere a monetary phenomenon." -Milton Friedman

[@sivi9741]

Yup with a constant velocity of money , check the algebra …… The second part always missing …..

[@M16Ben]

End all COVID restrictions. That would be a great start to improving the economic situation.

[@oliverscratch]

That would further reduce the size of the workforce, lower production, and increase cost push inflation.

[@M16Ben]

@@oliverscratch lower the workforce? What are you implying?

[@oliverscratch]

@@M16Ben End covid restrictions -> infection rate increases -> more workers die -> available workforce decreases -> production decreases -> prices increase

[@M16Ben]

@@oliverscratch yeah, more people will die from something that 99.9% of people survive... totally scary

[@oliverscratch]

@@M16Ben As of today the survival rate among the infected in the USA is 98.4%. 837,675 people are dead in the US alone and 5,412,748 are dead worldwide. If you can explain how dramatically increasing that number improves the global economic situation I'll be glad to listen. If you can't, this conversation is over.

[@BennieVredestein]

Fantastic video bro, Merry Christmas

[@hypnotista]

1:15 for a video shot of the creator. Thank you for your excellent work!

[@TJ-fo7gy]

Luckily Biden tweeted yesterday that gas prices went down 10 cents so there is no more inflation!