Kudos to Oldag2020 for actually engaging in intelligent discussion, even though most of us disagree with him.

Oldag2020 said:

---

We aren't going to raise interest rates. Modern monetary theory proponents are perfectly fine with spending to get out of a hole, but keep a lid on inflation with taxes being the lever.

---

Raising interest rates was the solution to the stagflation of the 1970s. Nothing has fundamentally changed about economics since then.

Infection_Ag11 said:

---

Oldag2020 said:

---

We aren't going to raise interest rates. Modern monetary theory proponents are perfectly fine with spending to get out of a hole, but keep a lid on inflation with taxes being the lever.

---

Raising interest rates was the solution to the stagflation of the 1970s. Nothing has fundamentally changed about economics since then.

---

Well, except the fact that it's apparently art now.

Quote:

---

By the same token, you absolutely DO NOT hoard cash if you expect runaway inflation.

Also, the 1929 depression only became a depression because of the ridiculous mismanagement by the fed. If the fed would have stepped up to the plate like they have ever since, the blow would've been much much softer. Free markets do work best, but only up to a certain point.

---

What exactly should the FED have done instead?

And what is the point that free markets are no longer best?

And do you have a response to Jamie Dimon's reason for hoarding cash being 100% in the opposite direction of why you think he was?

mazag08 said:

---

I mean.. do you even read up on the anecdotes you try to throw at me?

Jamie Dimon: JPMorgan is hoarding cash because 'very good chance' inflation here to stay (cnbc.com)

Quote:

---

• JPMorgan Chase has been "effectively stockpiling" cash rather than using it to buy Treasuries or other investments because of the possibility higher inflation will force the Federal Reserve to boost interest rates, Dimon said Monday during a conference.
• "We have a lot of cash and capability and we're going to be very patient, because I think you have a very good chance inflation will be more than transitory," said Dimon, longtime JPMorgan CEO.
• The bank now expects $52.5 billion in net interest income in 2021, down from the $55 billion it disclosed in February, as the firm stockpiled cash and on lower credit card balances.

---

---

Wondered when this would come up.

Having been in the room with Jamie Dimon, I can assure you his reasonings is not what our young student believes them to be.

mazag08 said:

---

I mean.. do you even read up on the anecdotes you try to throw at me?

Jamie Dimon: JPMorgan is hoarding cash because 'very good chance' inflation here to stay (cnbc.com)

Quote:

---

• JPMorgan Chase has been "effectively stockpiling" cash rather than using it to buy Treasuries or other investments because of the possibility higher inflation will force the Federal Reserve to boost interest rates, Dimon said Monday during a conference.
• "We have a lot of cash and capability and we're going to be very patient, because I think you have a very good chance inflation will be more than transitory," said Dimon, longtime JPMorgan CEO.
• The bank now expects $52.5 billion in net interest income in 2021, down from the $55 billion it disclosed in February, as the firm stockpiled cash and on lower credit card balances.

---

---

It makes sense that they are holding cash if they expect interest rates to rise. My bet would be they wait until after today's fed meeting and no matter what (if rates remain, lower, or increase) they will redeploy that cash

Definitely there are some valid views mentioned that I had not considered.

mazag08 said:

---

Infection_Ag11 said:

---

Oldag2020 said:

---

We aren't going to raise interest rates. Modern monetary theory proponents are perfectly fine with spending to get out of a hole, but keep a lid on inflation with taxes being the lever.

---

Raising interest rates was the solution to the stagflation of the 1970s. Nothing has fundamentally changed about economics since then.

---

Well, except the fact that it's apparently art now.

---

My knowledge of finance and economics is entirely self taught, and is dwarfed by most in this thread. But my superficial understanding and personal experience leads me to believe economics is art in theory only. In practice there are fundamental hard and fast rules, if for no other reason than human nature is consistent across time and space.

mazag08 said:

---

Quote:

---

By the same token, you absolutely DO NOT hoard cash if you expect runaway inflation.

Also, the 1929 depression only became a depression because of the ridiculous mismanagement by the fed. If the fed would have stepped up to the plate like they have ever since, the blow would've been much much softer. Free markets do work best, but only up to a certain point.

---

What exactly should the FED have done instead?

And what is the point that free markets are no longer best?

And do you have a response to Jamie Dimon's reason for hoarding cash being 100% in the opposite direction of why you think he was?

---

Many things could have been done differently, but at the end of the day, attempting to raise interest rates to reduce the over inflated asset prices. They increased interest rates which drastically hurt production, and was one of the key triggers(there were others) of the depression.

Oldag2020 said:

---

mazag08 said:

---

I mean.. do you even read up on the anecdotes you try to throw at me?

Jamie Dimon: JPMorgan is hoarding cash because 'very good chance' inflation here to stay (cnbc.com)

Quote:

---

• JPMorgan Chase has been "effectively stockpiling" cash rather than using it to buy Treasuries or other investments because of the possibility higher inflation will force the Federal Reserve to boost interest rates, Dimon said Monday during a conference.
• "We have a lot of cash and capability and we're going to be very patient, because I think you have a very good chance inflation will be more than transitory," said Dimon, longtime JPMorgan CEO.
• The bank now expects $52.5 billion in net interest income in 2021, down from the $55 billion it disclosed in February, as the firm stockpiled cash and on lower credit card balances.

---

---

It makes sense that they are holding cash if they expect interest rates to rise. My bet would be they wait until after today's fed meeting and no matter what (if rates remain, lower, or increase) they will redeploy that cash

Definitely there are some valid views mentioned that I had not considered.

---

The true tell won't be in today's Fed meeting because they aren't moving rates today and probably aren't even ready to discuss tapering just yet. The Dot plots survey is going to be the real thing to watch because that will indicate what the behind the scene conversations are. It will be very telling if they move the first rate hike on the dot plot up to 2023.

Just because economists don't agree doesn't mean it's an art. It means some of them are wrong. Similarly, if a scientist believes the Earth is flat, he would simply be wrong too.

The economists you believe are every bit as wrong as flat Earthers.

aTmAg said:

---

Just because economists don't agree doesn't mean it's an art. It means some of them are wrong. Similarly, if a scientist believes the Earth is flat, he would simply be wrong too.

The economists you believe are every bit as wrong as flat Earthers.

---

I'd imagine they'd say the exact same thing about your theories!

Oldag2020 said:

---

aTmAg said:

---

Just because economists don't agree doesn't mean it's an art. It means some of them are wrong. Similarly, if a scientist believes the Earth is flat, he would simply be wrong too.

The economists you believe are every bit as wrong as flat Earthers.

---

I'd imagine they'd say the exact same thing about your theories!

---

My side's predictions come true. Theirs fails time and time again.

But clearly you don't care about actual results.

mazag08 said:

---

I mean.. do you even read up on the anecdotes you try to throw at me?

Jamie Dimon: JPMorgan is hoarding cash because 'very good chance' inflation here to stay (cnbc.com)

Quote:

---

• JPMorgan Chase has been "effectively stockpiling" cash rather than using it to buy Treasuries or other investments because of the possibility higher inflation will force the Federal Reserve to boost interest rates, Dimon said Monday during a conference.
• "We have a lot of cash and capability and we're going to be very patient, because I think you have a very good chance inflation will be more than transitory," said Dimon, longtime JPMorgan CEO.
• The bank now expects $52.5 billion in net interest income in 2021, down from the $55 billion it disclosed in February, as the firm stockpiled cash and on lower credit card balances.

---

---

I've been getting offers left and right from my investment bankers (Goldman, etc..) offering me increased CD rates on longer term CDs. They are not stupid. They know what's coming.

Oldag2020 said:

---

aTmAg said:

---

Just because economists don't agree doesn't mean it's an art. It means some of them are wrong. Similarly, if a scientist believes the Earth is flat, he would simply be wrong too.

The economists you believe are every bit as wrong as flat Earthers.

---

I'd imagine they'd say the exact same thing about your theories!

---

From my perspective, the totality of the data post-industrial revolution paints a pretty clear picture with respect to which theories are "right".

Infection_Ag11 said:

---

Oldag2020 said:

---

aTmAg said:

---

Just because economists don't agree doesn't mean it's an art. It means some of them are wrong. Similarly, if a scientist believes the Earth is flat, he would simply be wrong too.

The economists you believe are every bit as wrong as flat Earthers.

---

I'd imagine they'd say the exact same thing about your theories!

---

From my perspective, the totality of the data post-industrial revolution paints a pretty clear picture with respect to which theories are "right".

---

One of the greatest fallacy's investment advisors convince their clients of is that they know what will happen by looking into the past.

Yes, it's a data point that should be considered, but is far from the entire picture.

Oldag2020 said:

---

Infection_Ag11 said:

---

Oldag2020 said:

---

aTmAg said:

---

Just because economists don't agree doesn't mean it's an art. It means some of them are wrong. Similarly, if a scientist believes the Earth is flat, he would simply be wrong too.

The economists you believe are every bit as wrong as flat Earthers.

---

I'd imagine they'd say the exact same thing about your theories!

---

From my perspective, the totality of the data post-industrial revolution paints a pretty clear picture with respect to which theories are "right".

---

One of the greatest fallacy's investment advisors convince their clients of is that they know what will happen by looking into the past.

Yes, it's a data point that should be considered, but is far from the entire picture.

---

Sure, but the principles that govern what will happen are largely static. That isn't where the variability comes from.

Much of what is being argued here is base economic theory, not the volatile circumstances that decide how that plays out in the real world. When investment advice fails, in my experience, it's generally because of unforeseen or poorly predicted circumstances.

To use an analogy from my field, which antibiotics cover which bacteria containing which resistance mechanisms represent hard and fast rules. Penicillin always treats syphilis, for example. When antibiotics fail as a matter of empiric therapy, it's usually because you incorrectly assessed the circumstances and patient risk factors and prescribed the wrong antibiotic for the organism they actually have (as opposed to the one you thought they did). That antibiotic works just fine, you just implemented it incorrectly.

Oldag2020 said:

---

Infection_Ag11 said:

---

Oldag2020 said:

---

aTmAg said:

---

Just because economists don't agree doesn't mean it's an art. It means some of them are wrong. Similarly, if a scientist believes the Earth is flat, he would simply be wrong too.

The economists you believe are every bit as wrong as flat Earthers.

---

I'd imagine they'd say the exact same thing about your theories!

---

From my perspective, the totality of the data post-industrial revolution paints a pretty clear picture with respect to which theories are "right".

---

One of the greatest fallacy's investment advisors convince their clients of is that they know what will happen by looking into the past.

Yes, it's a data point that should be considered, but is far from the entire picture.

---

When talking about individual stocks or funds, then sure. You can never predict when some event will tank a particular stock. But when taking about comparing free economies to centrally planned economies, it is literally 100%. Banking on central planning is like betting against the sun rising tomorrow.

Oldag2020 said:

---

Everything you listed is increasing in price due to temporary supply imbalances. ie it is transitory and will not continue for the foreseeable future.

Rule #1 don't fight the fed

The fed isn't worried and neither am I

---

Rule #2 Don't drink the koolaid...

Infection_Ag11 said:

---

Oldag2020 said:

---

Infection_Ag11 said:

---

Oldag2020 said:

---

aTmAg said:

---

Just because economists don't agree doesn't mean it's an art. It means some of them are wrong. Similarly, if a scientist believes the Earth is flat, he would simply be wrong too.

The economists you believe are every bit as wrong as flat Earthers.

---

I'd imagine they'd say the exact same thing about your theories!

---

From my perspective, the totality of the data post-industrial revolution paints a pretty clear picture with respect to which theories are "right".

---

One of the greatest fallacy's investment advisors convince their clients of is that they know what will happen by looking into the past.

Yes, it's a data point that should be considered, but is far from the entire picture.

---

Sure, but the principles that govern what will happen are largely static. That isn't where the variability comes from.

Much of what is being argued here is base economic theory, not the volatile circumstances that decide how that plays out in the real world. When investment advice fails, in my experience, it's generally because of unforeseen or poorly predicted circumstances.

---

I respectfully disagree that economics and finance are static. They are ever changing as we become more advanced and interconnected as a civilization.

Using your analogy(I'm no dr. but I think you'll get the point) it'd be like having a disease that continues to evolve until it is no longer treatable by antibiotics. Now what do you do? You need to develop a new and improved medicine that can help cure the patient of their disease.

Similarly, 100% free markets no longer work. Times are changing, we are advancing, becoming more interconnected, and we need a new prescription to cure the disease.

aTmAg said:

---

Oldag2020 said:

---

Infection_Ag11 said:

---

Oldag2020 said:

---

aTmAg said:

---

Just because economists don't agree doesn't mean it's an art. It means some of them are wrong. Similarly, if a scientist believes the Earth is flat, he would simply be wrong too.

The economists you believe are every bit as wrong as flat Earthers.

---

I'd imagine they'd say the exact same thing about your theories!

---

From my perspective, the totality of the data post-industrial revolution paints a pretty clear picture with respect to which theories are "right".

---

One of the greatest fallacy's investment advisors convince their clients of is that they know what will happen by looking into the past.

Yes, it's a data point that should be considered, but is far from the entire picture.

---

When talking about individual stocks or funds, then sure. You can never predict when some event will tank a particular stock. But when taking about comparing free economies to centrally planned economies, it is literally 100%. Banking on central planning is like betting against the sun rising tomorrow.

---

I'm not talking about central planning. That's is way out of left field. I am simply saying there is an optimal mix between government spending and a 100% free market.

WSJ today said that lumber prices are DOWN ! So there's that .

BigJim49 AustinNowDallas said:

---

WSJ today said that lumber prices are DOWN ! So there's that .

---

Who could have guessed lumber, among other sectors, are transitorily inflated?

Thanks for posting.

Oldag2020 said:

---

Infection_Ag11 said:

---

Oldag2020 said:

---

Infection_Ag11 said:

---

Oldag2020 said:

---

aTmAg said:

---

Just because economists don't agree doesn't mean it's an art. It means some of them are wrong. Similarly, if a scientist believes the Earth is flat, he would simply be wrong too.

The economists you believe are every bit as wrong as flat Earthers.

---

I'd imagine they'd say the exact same thing about your theories!

---

From my perspective, the totality of the data post-industrial revolution paints a pretty clear picture with respect to which theories are "right".

---

One of the greatest fallacy's investment advisors convince their clients of is that they know what will happen by looking into the past.

Yes, it's a data point that should be considered, but is far from the entire picture.

---

Sure, but the principles that govern what will happen are largely static. That isn't where the variability comes from.

Much of what is being argued here is base economic theory, not the volatile circumstances that decide how that plays out in the real world. When investment advice fails, in my experience, it's generally because of unforeseen or poorly predicted circumstances.

---

I respectfully disagree that economics and finance are static. They are ever changing as we become more advanced and interconnected as a civilization.

Using your analogy(I'm no dr. but I think you'll get the point) it'd be like having a disease that continues to evolve until it is no longer treatable by antibiotics. Now what do you do? You need to develop a new and improved medicine that can help cure the patient of their disease.

Similarly, 100% free markets no longer work. Times are changing, we are advancing, becoming more interconnected, and we need a new prescription to cure the disease.

---

It is asinine to say "free markets no longer work". We have spent 100 years moving away from free markets. THAT is what it not working. Across the world and history, the closer an economy is to free markets the better they are. The further left they go, the worse of they become. Just like the US.

Oldag2020 said:

---

aTmAg said:

---

Oldag2020 said:

---

Infection_Ag11 said:

---

Oldag2020 said:

---

aTmAg said:

---

Just because economists don't agree doesn't mean it's an art. It means some of them are wrong. Similarly, if a scientist believes the Earth is flat, he would simply be wrong too.

The economists you believe are every bit as wrong as flat Earthers.

---

I'd imagine they'd say the exact same thing about your theories!

---

From my perspective, the totality of the data post-industrial revolution paints a pretty clear picture with respect to which theories are "right".

---

One of the greatest fallacy's investment advisors convince their clients of is that they know what will happen by looking into the past.

Yes, it's a data point that should be considered, but is far from the entire picture.

---

When talking about individual stocks or funds, then sure. You can never predict when some event will tank a particular stock. But when taking about comparing free economies to centrally planned economies, it is literally 100%. Banking on central planning is like betting against the sun rising tomorrow.

---

I'm not talking about central planning. That's is way out of left field. I am simply saying there is an optimal mix between government spending and a 100% free market.

---

The Fed trying to encourage (over) spending through monetary policy IS central planning. If they exist at all, the Fed should only print money to match output of the economy. We could replace the entire thing with a single processor computer.

aTmAg said:

---

Oldag2020 said:

---

Infection_Ag11 said:

---

Oldag2020 said:

---

Infection_Ag11 said:

---

Oldag2020 said:

---

aTmAg said:

---

Just because economists don't agree doesn't mean it's an art. It means some of them are wrong. Similarly, if a scientist believes the Earth is flat, he would simply be wrong too.

The economists you believe are every bit as wrong as flat Earthers.

---

I'd imagine they'd say the exact same thing about your theories!

---

From my perspective, the totality of the data post-industrial revolution paints a pretty clear picture with respect to which theories are "right".

---

One of the greatest fallacy's investment advisors convince their clients of is that they know what will happen by looking into the past.

Yes, it's a data point that should be considered, but is far from the entire picture.

---

Sure, but the principles that govern what will happen are largely static. That isn't where the variability comes from.

Much of what is being argued here is base economic theory, not the volatile circumstances that decide how that plays out in the real world. When investment advice fails, in my experience, it's generally because of unforeseen or poorly predicted circumstances.

---

I respectfully disagree that economics and finance are static. They are ever changing as we become more advanced and interconnected as a civilization.

Using your analogy(I'm no dr. but I think you'll get the point) it'd be like having a disease that continues to evolve until it is no longer treatable by antibiotics. Now what do you do? You need to develop a new and improved medicine that can help cure the patient of their disease.

Similarly, 100% free markets no longer work. Times are changing, we are advancing, becoming more interconnected, and we need a new prescription to cure the disease.

---

It is asinine to say "free markets no longer work". We have spent 80 years moving away from free markets. THAT is what it not working. Across the world and history, the closer an economy is to free markets the better they are. The further left they go, the worse of they become. Just like the US.

---

It baffles me that you believe our economy was stronger 80 years ago than today.

Oldag2020 said:

---

aTmAg said:

---

Oldag2020 said:

---

Infection_Ag11 said:

---

Oldag2020 said:

---

Infection_Ag11 said:

---

Oldag2020 said:

---

aTmAg said:

---

Just because economists don't agree doesn't mean it's an art. It means some of them are wrong. Similarly, if a scientist believes the Earth is flat, he would simply be wrong too.

The economists you believe are every bit as wrong as flat Earthers.

---

I'd imagine they'd say the exact same thing about your theories!

---

From my perspective, the totality of the data post-industrial revolution paints a pretty clear picture with respect to which theories are "right".

---

One of the greatest fallacy's investment advisors convince their clients of is that they know what will happen by looking into the past.

Yes, it's a data point that should be considered, but is far from the entire picture.

---

Sure, but the principles that govern what will happen are largely static. That isn't where the variability comes from.

Much of what is being argued here is base economic theory, not the volatile circumstances that decide how that plays out in the real world. When investment advice fails, in my experience, it's generally because of unforeseen or poorly predicted circumstances.

---

I respectfully disagree that economics and finance are static. They are ever changing as we become more advanced and interconnected as a civilization.

Using your analogy(I'm no dr. but I think you'll get the point) it'd be like having a disease that continues to evolve until it is no longer treatable by antibiotics. Now what do you do? You need to develop a new and improved medicine that can help cure the patient of their disease.

Similarly, 100% free markets no longer work. Times are changing, we are advancing, becoming more interconnected, and we need a new prescription to cure the disease.

---

It is asinine to say "free markets no longer work". We have spent 80 years moving away from free markets. THAT is what it not working. Across the world and history, the closer an economy is to free markets the better they are. The further left they go, the worse of they become. Just like the US.

---

It baffles me that you believe our economy was stronger 80 years ago than today.

---

We have a crap ton more people and factories today building stuff than we did 80 years ago, of course GDP is higher now. Yet with the technology and number of people we had at the time, our economy was much stronger back then. If we had those policies throughout these 100 years, we'd be living like the Jetsons by now.

aTmAg said:

---

Oldag2020 said:

---

aTmAg said:

---

Oldag2020 said:

---

Infection_Ag11 said:

---

Oldag2020 said:

---

Infection_Ag11 said:

---

Oldag2020 said:

---

aTmAg said:

---

Just because economists don't agree doesn't mean it's an art. It means some of them are wrong. Similarly, if a scientist believes the Earth is flat, he would simply be wrong too.

The economists you believe are every bit as wrong as flat Earthers.

---

I'd imagine they'd say the exact same thing about your theories!

---

From my perspective, the totality of the data post-industrial revolution paints a pretty clear picture with respect to which theories are "right".

---

One of the greatest fallacy's investment advisors convince their clients of is that they know what will happen by looking into the past.

Yes, it's a data point that should be considered, but is far from the entire picture.

---

Sure, but the principles that govern what will happen are largely static. That isn't where the variability comes from.

Much of what is being argued here is base economic theory, not the volatile circumstances that decide how that plays out in the real world. When investment advice fails, in my experience, it's generally because of unforeseen or poorly predicted circumstances.

---

I respectfully disagree that economics and finance are static. They are ever changing as we become more advanced and interconnected as a civilization.

Using your analogy(I'm no dr. but I think you'll get the point) it'd be like having a disease that continues to evolve until it is no longer treatable by antibiotics. Now what do you do? You need to develop a new and improved medicine that can help cure the patient of their disease.

Similarly, 100% free markets no longer work. Times are changing, we are advancing, becoming more interconnected, and we need a new prescription to cure the disease.

---

It is asinine to say "free markets no longer work". We have spent 80 years moving away from free markets. THAT is what it not working. Across the world and history, the closer an economy is to free markets the better they are. The further left they go, the worse of they become. Just like the US.

---

It baffles me that you believe our economy was stronger 80 years ago than today.

---

We have a crap ton more people and factories today building stuff than we did 80 years ago, of course GDP is higher now. Yet with the technology and number of people we had at the time, our economy was much stronger back then. If we had those policies throughout these 80 years, we'd be living like the Jetsons by now.

---

I should say 100 years, not 80. I do not want to include FDR. The guy was an economic moron.

Debt to GDP ratio in 1941 = 38%. 130% today.

Our debt is growing faster than GDP. In effect, our GDP is actually negative.

Federal Reserve Board and Federal Open Market Committee release economic projections from the June 15-16 FOMC meeting: https://t.co/wQT9Tjb1PO

— Federal Reserve (@federalreserve) June 16, 2021

Fed does not change policy.
Fed raises gdp outlook to 7%
Fed maintains asset purchases at $120 b
Fed maintains belief current inflation is transitory

Actual inflation is currently 2%. Everything above is transitory.
Long term Inflation expectations are 3.4%. A far cry from the 6% many on this site were expecting.

Oldag2020 said:

---

Fed does not change policy.
Fed raises gdp outlook to 7%
Fed maintains asset purchases at $120 b
Fed maintains belief current inflation is transitory

Actual inflation is currently 2%. Everything above is transitory.
Long term Inflation expectations are 3.4%. A far cry from the 6% many on this site were expecting.

---

And as I said above, the number of members predicting earlier rate hikes doubled since this last meeting.

That is the real news.

Hilarious