Dee Feat is in Dee Flation - Part the Thirty Second

It's been many months since the last entry in this subject. My bad. The fact remains: all that TARP and QE money still hasn't generated inflation. You can only get wage push or demand pull inflation if the newly printed moolah ends up in the hands of the underclasses. Period. That is also, as it happens, how you get growth. Growth is caused by increasing demand, and that only happens when new moolah gets to the hands of those who buy stuff with that new money. The 1%-ers who got the QE moolah weren't and didn't. The "supply side" notion has been disproven every time it's been tried. It was never anything more than an excuse to send moolah to the 1%. As you will see below, producers do all they can to constrain output. Cartels are one fairly well known mechanism. Deflation is still the big bad bear; it stifles both production and demand. And, once again, Neil Irwin reads my mind.

There is a worldwide glut that includes oil wells, steel plants and eager would-be workers, and it will take more than a United States presidential election and a few months of solid global growth to fix it.

So, why don't they just stop producing? That nasty capital albatross: they gots to pay the Piper no matter how much they produce, so they're boxed into generating any cashflow they can. And who's the Piper? All those 1%-ers with idle cash they want return on. Get a job, for crying out loud.

As has been mentioned by a few of the saner mainstream pundits: since the 1980s, manufacturing output has about doubled with about a third less labor. It wasn't China or Mexico, but automation that took the jobs. Everywhere.

All the trickle down folks, including by default Obambi/Bernanke, simply ignore that handing out Bongo Bucks to the .1% who already have more than they can spend doesn't do anything for GDP growth. On a zero-sum basis, well, some win and others lose. But nothing good happens overall. The Revenge of Laffer is in the Mnuchin propaganda.

The Republican tax-cut plan is designed to reduce the tax burden for the very rich, and, since this is a highly unpopular thing to do, Republicans are going to spend a lot of time lying about it. Treasury Secretary Steve Mnuchin was dispatched to do the round of morning shows, and his first attempt at lying did not go especially well.

Back to I Still Hate Neil:

... many of the biggest forces in the economy don't announce themselves with an election or a central banker's announcement, but through shifts in the underlying forces that make the global economy tick. And those don't change overnight.

Here, Neil is a bit too naive`: the Great Recession did announce itself pretty much to those paying attention. And the Trump tax cut, if it happens as now stated, will generate the Permanent Depression. Of course, Orange Julius Caesar is certainly on the way to starting a War, if only to install himself as dictator. It's happened before, you might know.

We'll really know the Right Wingnuts are worried when they demand the Damn Gummint pay them more interest on bonds than they can get from private investment.