Quote from: Gyfts on July 25, 2021, 03:09:39 AM

Quote from: abhiseshakana on September 23, 2020, 08:53:53 AM

Quote from: Findingnemo on September 23, 2020, 04:20:57 AM

Have you heard the term Inflation before? It simple means more money has been printed every year while adds more in the circulating supply as a result of this the purchasing power of your money is going down every year.

According to the Keynesian theory, printing money will cause inflation. But according to Michael Hudson, an expert on Modern Monetary Theory (MMT), money printing does not always end in inflation as long as money printing is not used to pump demand through direct cash assistance, but money is printed to increase production or money is printed based on layered projects such as in China. The project itself should be independent, free from imported raw materials, free from foreign workers, and must be in the manufacturing industry sector, not in the service or trading sector.

The goal is a rotating economy, when the industry moves, purchasing power will be maintained, economic growth will occur and people's welfare will increase. So at times like this, the government of each industrial sector country can absorb a lot of labor so that it can boost domestic consumption figures and support the national economy when the global supply chain has not returned to normal, due to the pandemic which has hampered the export-import process.

Keynesian economic theory applies here because one, we already have the data available and that inflation currently exists in the US, but two, the funds that were being pumped out by the federal government were funds that were going to be torched the moment they hit people's bank accounts. Example - you have small businesses that took PPP loans and kept their staff on payroll, only for the restaurant/bar/pub to close down some number of months later. Is that loan money ever going to be paid back? Nope. So you have the government giving out loans to businesses that will never pay them back, handing millions of people unconditional 2k checks, and bailing out poorly run states so they can fund their social programs.

We know what the obvious result would be, yet some politicians seem keen on keeping the status quo of more reckless spending.

This is not even getting to the problem of a labor shortage, which will ofc increase the scarcity of commodities.

So government is doing nothing here, they are just moving the burden of business people to their citizen which is going to affect the business later for sure. Even US has such tragic scenario then compare what is happening in third world countries where government doesn't even give any stimuls but still increasing the tax rates for every goods to increase their medical infrastructure.