Yesterday was my first time being introduced to your work after reading through your Twitter discussion/argument with Jehu, and your work is very compelling so far.
However, I'm struggling to see how an increase in SNLT per commodity could be occurring if bailouts such as this are relatively new. And why is it that, since 2022, prices and M2 have decreased ever since this bailout? Shouldn't one expect the mass of money to increase?
SNLT of which commodities? Are you talking about in the aggregate? I don't think that productivity has actually changed all that much since after the first wave of the pandemic.
Final good prices /are/ still going up, just slower than they were before. The M2 has decreased, however, because any increase in monetary supply caused by these interest payments (100s of billions of dollars) has been offset by trillions of dollars less money creation/increasing money destruction via traditional methods.
Yeah, the aggregate. And for SNLT/commodity specifically, I'm referring to the secular trends in price that outscale the pandemic by decades.
I assume this is what you were referring to when you tweeted that "monetary policy has removed discipline on capitalist firms and thus labor... that only causes socially necessary labor time per commodity to increase, or decrease slower".
To me it seems that in order for this to happen, there needs to be some kind of general bailout-like mechanism built in to monetary policy that prevents corporations from wanting to cut costs. Maybe it's the case that before the pandemic, treasury bond interest payments played this role, and now afterwards we have this new "secret bailout"?
Sorry for the late reply, but it's much more common for this to be expressed empirically for SNLT to simply fall more slowly than rise, although this has happened in certain situations and industries. I'm not suggesting that this bailout is significantly changing SNLT, just that it's re-allocating surplus from industrial capital to financial capital for the most part.
Good afternoon Nicolas.
Yesterday was my first time being introduced to your work after reading through your Twitter discussion/argument with Jehu, and your work is very compelling so far.
However, I'm struggling to see how an increase in SNLT per commodity could be occurring if bailouts such as this are relatively new. And why is it that, since 2022, prices and M2 have decreased ever since this bailout? Shouldn't one expect the mass of money to increase?
Thanks in advance.
SNLT of which commodities? Are you talking about in the aggregate? I don't think that productivity has actually changed all that much since after the first wave of the pandemic.
Final good prices /are/ still going up, just slower than they were before. The M2 has decreased, however, because any increase in monetary supply caused by these interest payments (100s of billions of dollars) has been offset by trillions of dollars less money creation/increasing money destruction via traditional methods.
Thanks for getting back to me.
Yeah, the aggregate. And for SNLT/commodity specifically, I'm referring to the secular trends in price that outscale the pandemic by decades.
I assume this is what you were referring to when you tweeted that "monetary policy has removed discipline on capitalist firms and thus labor... that only causes socially necessary labor time per commodity to increase, or decrease slower".
To me it seems that in order for this to happen, there needs to be some kind of general bailout-like mechanism built in to monetary policy that prevents corporations from wanting to cut costs. Maybe it's the case that before the pandemic, treasury bond interest payments played this role, and now afterwards we have this new "secret bailout"?
Sorry for the late reply, but it's much more common for this to be expressed empirically for SNLT to simply fall more slowly than rise, although this has happened in certain situations and industries. I'm not suggesting that this bailout is significantly changing SNLT, just that it's re-allocating surplus from industrial capital to financial capital for the most part.