* The inadequate aggregate supply and product price surges caused by production halts from lockdown measures and requests to refrain from going out during the COVID-19 pandemic were typical examples of cost-push inflation originating from supply shocks, rather than demand-pull inflation where rapid expansion of aggregate demand outpaces an overheating economy. * The shrinkage of supply chains due to stay-at-home requests and lockdowns led to shortages and price spikes in non-woven masks, disposable rubber gloves, certain chemical raw materials for alcohol sanitizers, home video game consoles driven by nesting demand, construction lumber, and used cars due to the halt in new car production.
* Central banks around the world that faced this type of cost-push inflation resulting from supply shocks successfully countered it not by raising interest rates, but by lowering interest rates, alongside income compensation payouts provided by many governments.
* However, during the cost-push inflation stemming from the war in Ukraine that began in 2022, central banks such as the FRB and ECB did the exact opposite, repeatedly carrying out "panic rate hikes," which ironically brought about high inflation.
* The FRB and ECB must closely scrutinize the fact that their inflation countermeasures during the 2020 COVID-19 pandemic and the 2022 Ukraine war were diametrically opposed (rate cuts vs. rate hikes), leading to contrasting outcomes. They must candidly reflect on their mistakes and gracefully offer an apology and compensation to President Trump and the American people.
1
0
新型コロナ·パンデミックと最適インフレ対策
* The inadequate aggregate supply and product price surges caused by production halts from lockdown measures and requests to refrain from going out during the COVID-19 pandemic were typical examples of cost-push inflation originating from supply shocks, rather than demand-pull inflation where rapid expansion of aggregate demand outpaces an overheating economy.
* The shrinkage of supply chains due to stay-at-home requests and lockdowns led to shortages and price spikes in non-woven masks, disposable rubber gloves, certain chemical raw materials for alcohol sanitizers, home video game consoles driven by nesting demand, construction lumber, and used cars due to the halt in new car production.
* Central banks around the world that faced this type of cost-push inflation resulting from supply shocks successfully countered it not by raising interest rates, but by lowering interest rates, alongside income compensation payouts provided by many governments.
* However, during the cost-push inflation stemming from the war in Ukraine that began in 2022, central banks such as the FRB and ECB did the exact opposite, repeatedly carrying out "panic rate hikes," which ironically brought about high inflation.
* The FRB and ECB must closely scrutinize the fact that their inflation countermeasures during the 2020 COVID-19 pandemic and the 2022 Ukraine war were diametrically opposed (rate cuts vs. rate hikes), leading to contrasting outcomes. They must candidly reflect on their mistakes and gracefully offer an apology and compensation to President Trump and the American people.
https://gyazo.com/b0b595b3462bbb85079352e174fdc6e2