@aussteve posted:You can't print and hand out trillions of dollars in a year and not expect the value of your money to decrease (that means prices go up). Lots more dollars are now chasing a fixed number of products.
It's that thing we don't teach in school anymore called economics.
That isn't the cause of the inflation we are seeing, and I am getting a little tired of it, we have been running deficits for the years before covid and we didn't see any large inflation, how come.........in the 3 years prior to covid we were running 1 trillion a year deficits with a supposedly booming economy....
The inflation you are seeing is real, and it is caused by Covid related circumstances. With Covid raging, they had cargo ships sitting outside the ports on the west coast (hint: where most of the stuff made in Asia comes into the US), so stuff couldn't get in....or out. Why out? stuff wasn't moving from the US to China, which is how containers get back there, so there are shortages shipping out of China. One of the problems was shipping companies, anticipating a recession, cut back on their orders for containers (said companies then laid off their employees)...so when it turned out that during Covid there wasn't a mass recession, where there was demand, they couldn't bring in enough to meet demand. Lumber skyrocketed, not because of shipping, but because lumber companies cut back production anticipating slack demand, and are now scrambling to catch up (lumber prices are starting to drop).
Basically the whole supply chain is wacked out with all this. Oils and cleaning products and paints have problems because of components they need not being available and chips are like scarce as ice cubes in the desert sun. I needed the dz-1008 relays and they are like backordered and no one knows when they will be available (fortunately I can wait, given my track laying is likely gonna take longer than the transcontinental railroad).
Oil prices aren't directly involved. The price of oil today is roughly where it was before covid hit, there is a battle going on between producers in OPEC that is causing a hit (it isn't because the US doesn't have enough oil, we do, it is that oil is traded globally and prices are set globally).
Add that to a world where most stuff is made via just in time inventory, where manufacturers depend on parts being there right when they are needed, and you have a mess. The auto industry is producing cars at like half the volume because they can't get the components needed for the ECU's and other control systems. Sony and Microsoft are going crazy because they can't meet demand for PS5 and Xbox (whatever the heck it is up to) consoles. One of my employee has been trying to get a replacement laptop battery for 2 months (they can't just go and buy from some Chinese place on ebay or amazon, has to be an official laptop battery from the maker). Eventually it will straighten out but it does show a lot of weak points in the current system, among other things, not surprisingly, that most people in industry and the like assumed a pandemic would never happen and their global supply chain would just keep chugging along. It is funny, industries spend a lot of time on contingency and disaster planning, take it from me, but they spent zero time on the thought the supply chain would break. Add to that another one, if the weather hypothetically goes to heck, what happens to shipping them if ships are facing increased storm activity, especially in the pacific? What happens when major storms routinely knock out truck and train shipping?
