The Offbeat Talk: A chatter about Economics - Part 1
By Ptrikha_2
@ptrikha_2 (49776)
India
July 23, 2023 9:42am CST
During the course of a recent discussion with @TheSojourner (Coral) I was talking in terms of inflation and ot things of Economics.
She kind of asked/suggested me that why not a discussion on Economics !
Now, this is not the place for a full blown Economics talk, but let me just share what I know of especially with respect to the current state of inflation and challenges that many countries are facing.
A)US and many countries are having higher inflation.
Rate is probably 6 to 10 % - higher than the 0 to 3 % they had for decades.
B) Argentina and a few countries have faced Hyperinflation i.e rates of 20 % or more.
That must have been awful as if an out of control going situation.
India too faced for a short time but thankfully it got controlled by different measures.
Printing extra currency is one of the ways to tide over short term fiscal deficit and money supply issues.
Yet it is like a patchy surgery which doesn't address the root cause of the vicious supply-demand factors.
I would share some more Economics thoughts in another post.
6 people like this
6 responses
@ptrikha_2 (49776)
• India
31 Jul 23
@thelme55
Yes and the problem continues and is impacting so many across the world!
2 people like this
@arthurchappell (44941)
• Preston, England
31 Jul 23
too much currency causes hyperinflation. Inflation is too much money chasing too few goods
1 person likes this
@ptrikha_2 (49776)
• India
31 Jul 23
@arthurchappell
Unmanaged printing of notes might seem like a tempting solution but it hits more after some time.
Stronger solutions are non-populist at times so governments are averse to those decisions like cutting subsidies of all kinds and reducing various taxes and government controls.
But too much of Laisez-Faire (or some similar sounding word)has its own issues like monopoly plus wider rich-poor divide!
Overall a complex issue !
2 people like this
@ptrikha_2 (49776)
• India
2 Aug 23
@arthurchappell
Yes and some issues puzzle even very renowned economists.
1 person likes this
@ptrikha_2 (49776)
• India
4 Aug 23
@arthurchappell
There are things that one learns with experience and time.
I am a so called SME or subject matter expert of a Technology but inside I know that I have yet to learn a lot of things in that Technology.
1 person likes this
@snowy22315 (209042)
• United States
23 Jul 23
It seems inflation is a problem worldwide now.
1 person likes this
@ptrikha_2 (49776)
• India
24 Jul 23
@snowy22315
It's a supply side problem.
A lot of it is due to the Russia-Ukraine war.
Yet I believe that globally linked chains and lack of alternatives is also an issue.
And so is mistrust among countries, logistics issues and trade barriers.
Suppose if a country has shortage of wheat and rice.
Can't they suddenly airlift tonnes of wheat from another country?
Yet often beauracracy hinders such solutions.
@ptrikha_2 (49776)
• India
24 Jul 23
@LadyDuck
Oh I didn't knew that it has touched 36 plus there.
Yes, there is a lot happening to follow in Economics around the world.
2 people like this
@ptrikha_2 (49776)
• India
24 Jul 23
@LadyDuck
That is good to know!
Then Economics must be a much talked about Subject in your house !!
1 person likes this
@ptrikha_2 (49776)
• India
11 Aug 23
@db20747
The financial controllers talk in multiple terms like WPI, RPI etc and often quote what suits them.
@ptrikha_2 (49776)
• India
31 Jul 23
@just4him
Yes as of now, US Fed has controlling inflation as one of its top priority.
1 person likes this
@db20747 (43419)
• Washington, District Of Columbia
11 Aug 23
Printing more currency can help pay for things people need if there is enough to go around and no shortage. We had shortages here. Increasing production and subsidies to important commodities might help very high inflation.
1 person likes this
@ptrikha_2 (49776)
• India
11 Aug 23
@db20747
Well, Inflation is not all about interest rates.
Matching demand and supply should be the main focus.
Yet it is never easy for the Central bankers and they often go for interest rates hikes.
1 person likes this
@ptrikha_2 (49776)
• India
11 Aug 23
@db20747
Often there are constraints with respect to increasing production.
Sometimes Farm produce for some crops is so much in a year that it is called a bumper harvest.
Then, those products sell at too low a price so farmers incur losses.
To do away with that, Government either has to provide a minimum support price (MSP) or give subsidies.
It often becomes a political matter.
As for industrial goods, normal demand and supply applies except for some so called inelastic demand items.
