Hacker News Reader

Comment by MiroF | Hacker News Reader

There are so many issues with this comment, it's hard to pin point any exact one.

You're right that it's idiotic to describe QE as "deflationary" (don't know where they go that idea) but QE is neither inflationary nor deflationary as either description would be reasoning from a price change [0].

> The fed has effectively destroyed any price discovery on any assets

Don't see why this would be the case - price discovery is relative.

All this talk about rioting in the streets - inflation is projected to go down in the next few years, which should help the average American saver. If there is any place for outrage, it's over the Fed not acting forcefully enough!

As it stands now, the Feds policy stance is contractionary, just as what followed 2008.

[0]: https://www.themoneyillusion.com/never-reason-from-a-price-c...

View on HN

And yet you didn't manage to find a single one to point out and inform me of where I'm misguided, only a condescending response. Address any one of my claims about asset prices and the fed's actions distorting price discovery, please. I'd rather be wrong and realize that I'll be just fine not panic buying assets while free money is distributed and stocks rip to infinity, ignoring any and all fundamentals.

Tell me how I'm wrong about housing prices in the last ten years doubling and tripling in some areas. Tell me again how my USD are just fine and buying the same amount of goods and services they did 10 years ago, because I contend their buying power has been effectively halved by the moral hazard presented by the fed and Congress not allowing failures to happen. They're doing the exact same thing right now. How will this end? Deflation? I used to think so but not anymore. JPow even said himself that he has unlimited power to print money. They'll sooner destroy the currency than allow a deflationary depression to take hold.

Again, please, educate me as to what my "many issues" are with any of what I've said.

I isolated two.

One is that overall inflation does not make price discovery problematic, because price discovery is a mechanism based on the relative pricing between things.

Two is that inflation is projected to dip below historical levels, so claims of a great inflationary spike that should be met by riots are not at all backed by empirical evidence.

You're not really engaging in good faith, so I'm not going to continue this chain.

Why don’t you google it instead of calling me an idiot. It’s not even slightly controversial, so all you jumping on this attack just reveal your actual ignorance on the subject. QE has led to deflation in Japan, not inflation.

Try reading this and you’ll get it: https://www.economyandmarkets.com/economy/central-banks/japa...

> It’s not even slightly controversial, so all you jumping on this attack just reveal your actual ignorance on the subject.

It's not even slightly controversial that QE causes deflation? That's just laughable, honestly. Look, mainstream economists disagree with you [0].

QE usually occurs in the context of a real shock that induces deflationary pressure, but the fact that QE and deflation sometimes co-occur is correlation, not causation.

[0]: https://www.themoneyillusion.com/how-strong-is-the-case-for-...

Too bad it never happened in Japan where we have a real world example we can actually compare it to. I think you’re in over your head on this.

> I think you’re in over your head on this.

If you can't tease out the difference between correlation and causation, I suspect that you are the one in over your head.

I have experience in academic economics, you clearly, do not.

https://www.themoneyillusion.com/wp-content/uploads/2019/10/...

Guess when Japan's deflation ended?

Reply on news.ycombinator.com