Lifting pandemic stimulus sooner would’ve limited inflation: Bank of Canada’s Macklem

The_Foxer

Council Member
Aug 9, 2022
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It was not just in hindsight. EVERYONE knew that it was going to cause inflation, everyone talked about it, anyone with half a brain knows if you dump billions of unearned dollars into the economy you're going to drive up inflation. There's no way NOT to.

The real issue is why is the federal gov't STILL spending like crazy and dumping money into the economy? Giving people MORE 'free cash' to spend is not going to bring inflation down, it makes it go up. Spending money on unnecessary projects or 'stimulus' makes things go up. You CANNOT "spend" your way out of inflation.

So why isn't the bank pointing THAT out now? OR is this going to be another thing they'll magically see in 'hindsight' in a year?
 

pgs

Hall of Fame Member
Nov 29, 2008
25,062
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B.C.

It was not just in hindsight. EVERYONE knew that it was going to cause inflation, everyone talked about it, anyone with half a brain knows if you dump billions of unearned dollars into the economy you're going to drive up inflation. There's no way NOT to.

The real issue is why is the federal gov't STILL spending like crazy and dumping money into the economy? Giving people MORE 'free cash' to spend is not going to bring inflation down, it makes it go up. Spending money on unnecessary projects or 'stimulus' makes things go up. You CANNOT "spend" your way out of inflation.

So why isn't the bank pointing THAT out now? OR is this going to be another thing they'll magically see in 'hindsight' in a year?
Nobody ever said the poufta with the pretty smile had any brains .
 

The_Foxer

Council Member
Aug 9, 2022
1,760
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Nobody ever said the poufta with the pretty smile had any brains .
I don't think anyone expected trudeau to be smart enough to figure out basic economics, or to be able to count money beyond what his fingers and toes allow for, but surely the frikkin BANK who's job it is to understand this stuff backwards and forwards is smart enough. But they've said nothing and allowed it to happen, and are saying nothing about the current level of spending and are allowing it to happen.
 

petros

The Central Scrutinizer
Nov 21, 2008
102,841
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Moccasin Flats

It was not just in hindsight. EVERYONE knew that it was going to cause inflation, everyone talked about it, anyone with half a brain knows if you dump billions of unearned dollars into the economy you're going to drive up inflation. There's no way NOT to.

The real issue is why is the federal gov't STILL spending like crazy and dumping money into the economy? Giving people MORE 'free cash' to spend is not going to bring inflation down, it makes it go up. Spending money on unnecessary projects or 'stimulus' makes things go up. You CANNOT "spend" your way out of inflation.

So why isn't the bank pointing THAT out now? OR is this going to be another thing they'll magically see in 'hindsight' in a year?
Nobody ever said the poufta with the pretty smile had any brains .
I don't think anyone expected trudeau to be smart enough to figure out basic economics, or to be able to count money beyond what his fingers and toes allow for, but surely the frikkin BANK who's job it is to understand this stuff backwards and forwards is smart enough. But they've said nothing and allowed it to happen, and are saying nothing about the current level of spending and are allowing it to happen.
There is another way to reduce cash surpluses that cause inflation....crash the economy.
 
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The_Foxer

Council Member
Aug 9, 2022
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There is another way to reduce cash surpluses that cause inflation....crash the economy.
That's not a very effective way. in fact there's been many times in history where a crashed economy hasn't done a darn thing to help inflation. Inflation in it's simplest terms is when supply is lower than demand, and when the economy crashes demand goes down but often because businesses close or cut back production supply takes a hit as well. There is no guarantee at all that an economic slowdown or recession will curb inflation (consider the whole milk strikes thing in the great depression - milk and butter prices rose and fell dramatically. Or the german economy around the same period where it took the legendary "wheelbarrow full of marks to buy a loaf of bread'.

The only sure way to actually flight inflation is to deal with the supply/demand issue, and that means increasing supply by promoting businesses and encouraging them to produce goods and services and/or reducing demand by reducing the amount of money in circulation and gov't spending. Gov't spending tends to be the biggest cause of inflation as it's not market driven spending as a rule.
 

petros

The Central Scrutinizer
Nov 21, 2008
102,841
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Moccasin Flats
This recent crypto crash has taken over a trillion in real cash out of the economy in one fell swoop. Yes some lose there shirts. Long haul investors will do well.
 
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