Everything you always wanted to know about inflation (but were afraid to ask)

SP5 Dennis Loberger - I respectively disagree. Oil and energy was down because everyone was locked down. That's when Trump smartly filled up the Strategic Oil Reserve. The supply chain was then disrupted that caused shortages, but not any real cost increases as I remember. It wasn't until energy prices went up wildly AND Biden/Harris flooded the economy with so much money by the Inflation Reduction Act they couldn't spend it quick enough. An organization I used to work for is still trying to help spend this funding... there is just too much money out there.

When I was a mid-level engineer in the early 90’s our state governor believed that we could make massive road and bridge repairs by letting out a massive amount of contracts for repairs and replacement. It didn’t work. We found there is a limited number of responsible contractors out there and all we did was drive up the price of contracts. The contractors put in wildly high bids, and if it was accepted they would drop the lessor contract. When Clinton and then Obama tried bidding out “shovel ready projects” to spend funding we all had a good laugh because we knew what was going to happen. They failed miserably.

You don’t understand the damage that was done to our economy by the Inflation Reduction Act. If we give people $25,000.00 to buy houses and free higher education inflation is going to be going crazy again. This stuff is just Economics 101. I’m no wizard.

I don't disagree with your analysis of the portions of the economy you point out. I hold to my analysis because it is macro not micro economics. I will get down to my view of Econ 101 in a different post not just because of our discussion but that of a couple others. Understand production went down as a result of diminishing demand. Production then lagged behind demand. I don't support most of what Harris has proposed because they either don't work or make things worse. The best solution is a Congress that puts a brake on nonsensical policies. That only happens when the President has to work with a Congress of a different party. I am neither a Biden nor Trump supporter

SP5 Dennis Loberger - Thank you for a good honest conversation. Macro/micro, it’s all the same to me. We make decisions based on what happens overall in a particular area. The decision making (judgement), on a grand scale, comes into focus when we have to decide the reach a product has on the overall economy. To me it’s best to let business decide that because we honestly don’t know their internal process or have the judgement on how very little items can drastically affect them.

Why do I say this? I rationalize this as a person who worked with and facilitated conversations with many different environmental disciplines on complex issues affecting actions (projects). I found while I can grasp some of the basics that may affect an action, when we have to split hairs to “decide” what is best “overall” I will defer to the induvial environmental disciplines. The trick comes when there is a difference of opinion by the different disciplines. Many times, the professional disciplines are so self-contained in their particular field they can’t see the overall health of the action/project, “sometimes they only care about their area of expertise”.

To clarify it, sometimes an action/project can negatively affect multiple resources present within the area or affected by it. When this happens we must decide which actions deliver the overall best health for ALL the resources present that can be affected. When I facilitated environment clearances, the most difficult item was to get the different disciplines to agree on the overall best path even if it didn’t give their favorite resource the best it could. It’s not a perfect world and we can’t make it perfect. I suppose that’s my problem with Democrats, they recommend actions that have unintended consequences because they don’t honestly look at all the nuts and bolts affecting an action… I digress. I am sorry.

Anyway, this is my thought process. I believe the decision making in environmental clearances is very similar process to decision making in the economy. I don’t really care for Biden, Trump, or Harris. I choose Trump because all things considered he has proven himself over time to make the best decisions for our national security, economy and environment, in that order. We have to put our overall people first. To me it’s that simple. If I believed Biden or Harris had the best decision making and/or polices I would support them. I see their policies tearing our Country apart plain and simple. Note: I am a registered Democrat.

No doubt we live and make decisions in the micro. We can have a good micro environment when there are good macro decisions made. It is very difficult to have a good micro world when the macro environment is bad. These bad decisions at the macro level have consequences that can radically change our world. The macro world affects all the micros. I don't go into the variations of measuring money supply but essentially you can think of money supply as demand and GDP as supply. When the money supply grows faster than GDP you have inflation. This is why decisions at the government level (macro)to spend and collect and interest rates have a profound effect on the economy