2024 Presidential Race

#11,376
#11,376
McDad said:
Can you provide some insight on how you understand reduced taxes is inflationary?
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Tax cuts are inflationary as they increase the demand for consumer goods and services. However, if a tax cut is met with a corresponding reduction in government spending, these inflationary pressures could be neutralized.

Given that tax cuts increase demand, any difficulty that producers encounter with increased levels of production will be countered with increased prices.

Supply side economists will argue that tax cuts influence the supply of labor and consumer goods as incentive to work and produce goods. I think Laffer's theory is manure. Trump's budget proposals gave unrealistic estimates of economic growth and couldn't be taken seriously. His policy was highly inflationary.
 
#11,378
#11,378
BowlBrother85 said:
Tax cuts are inflationary as they increase the demand for consumer goods and services. However, if a tax cut is met with a corresponding reduction in government spending, these inflationary pressures could be neutralized.
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Tax cuts increase the available supply of money in society and increased money supply is inflationary. Is that the gist of your understanding?
 
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#11,383
#11,383
BowlBrother85 said:
Yeah ... I guess.
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Give this some consideration:
I strongly disagree tax reductions are inflationary for the reasons you and the article from NZ provided. I can be compelled to agree for another reasons.

Money in a country is a closed system. The amount of money available is unchanged. The only difference is in who is spending. In a simplified approach, 100M more money supply available to citizens reduced 100M available for government. The net is zero. 100M more to government is 100M less to citizens. And since the 100M does not ever sit idle in a bank vault, it is used for goods and services (via either public or private spending) there is no inflation experienced based on this model.
Additionally, if we consider what occurs in real life (outside of our simple approach mentioned earlier) we routinely see, in America, that tax reductions are rarely correlated to less money coming into the treasury. This provides further evidence that the supply of money is unaltered when only tax reductions are considered because there is no increase in supply and yet availability increases to both the private side and the public side. How can this be? Because the velocity is changing. Velocity increases affect inflation. I theorize that money in the government hands experiences bureaucratic lag which reduces the velocity. If true, that decrease in velocity should decrease inflation.
 
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#11,384
#11,384
McDad said:
Give this some consideration:
I strongly disagree tax reductions are inflationary for the reasons you and the article from NZ provided. I can be compelled to agree for another reasons.

Money in a country is a closed system. The amount of money available is unchanged. The only difference is in who is spending. In a simplified approach, 100M more money supply available to citizens reduced 100M available for government. The net is zero. 100M more to government is 100M less to citizens. And since the 100M does not ever sit idle in a bank vault, it is used for goods and services (via either public or private spending) there is no inflation experienced based on this model.
Additionally, if we consider what occurs in real life (outside of our simple approach mentioned earlier) we routinely see, in America, that tax reductions are rarely correlated to less money coming into the treasury. This provides further evidence that the supply of money is unaltered when only tax reductions are considered because there is no increase in supply and yet availability increases to both the private side and the public side. How can this be? Because the velocity is changing. Velocity increases affect inflation. I theorize that money in the government hands experiences bureaucratic lag which reduces the velocity. If true, that decrease in velocity should decrease inflation.
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I subscribe to the Quantity Theory of Money .... I'm not sure what you subscribe to, but it doesn't make any sense.

www.investopedia.com

What Is the Quantity Theory of Money? Definition and Formula

Take a look at the tenets, assumptions, and challenges of one of monetarism's principal theories: the quantity theory of money.
www.investopedia.com www.investopedia.com
 
#11,385
#11,385
Weezer said:
You eat after the fight. Loser has to pay. Do you even Waffle House, bro?
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I’m glad you made this point because I was going to days ago and just forgot. Who weighs down with waffle house before a brawl? You have that after the fight. And if you lose any teeth you get offered a job on the spot.
 
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#11,386
#11,386
BowlBrother85 said:
I subscribe to the Quantity Theory of Money .... I'm not sure what you subscribe to, but it doesn't make any sense.

www.investopedia.com

What Is the Quantity Theory of Money? Definition and Formula

Take a look at the tenets, assumptions, and challenges of one of monetarism's principal theories: the quantity theory of money.
www.investopedia.com www.investopedia.com
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LOL

How do you think this counters McDads post? Tax cuts alone does not increase the quantity of money in the system, the money will be spent either by individuals (and business) or by the government. So lowering taxes alone does not increase the money flowing through the economy. When you couple tax cuts with increased deficit spending by the government then you are increasing the quantity of money but without increased deficit spending by the .gov the quantity isn't increasing.
 
#11,387
#11,387
DC_Vol said:
I’m glad you made this point because I was going to days ago and just forgot. Who weighs down with waffle house before a brawl? You have that after the fight. And if you lose any teeth you get offered a job on the spot.
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Only if you have enough tats. Multiple tattoos must be a requirement at my local WH.
 
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#11,389
#11,389
hog88 said:
LOL

How do you think this counters McDads post? Tax cuts alone does not increase the quantity of money in the system, the money will be spent either by individuals (and business) or by the government. So lowering taxes alone does not increase the money flowing through the economy. When you couple tax cuts with increased deficit spending by the government then you are increasing the quantity of money but without increased deficit spending by the .gov the quantity isn't increasing.
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From the first post, I made it clear that I was only discussing tax cuts in conjunction with an increase in government spending. I have said it in 3 or 4 different posts.

.... and who is actually spending the money does matter when it comes to the prices of consumer goods and services.
 
#11,390
#11,390
DC_Vol said:
Neck tat puts you on the fast track to management!
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One of the waitresses in ours has a smokeshow of a body but tats everywhere along with piercings in her nose, lip, eye and probably some in other places. I keep threatening to ask her "when did your poor life decisions begin". Wife has threatened me not to.
 
#11,391
#11,391
BowlBrother85 said:
I subscribe to the Quantity Theory of Money .... I'm not sure what you subscribe to, but it doesn't make any sense.

www.investopedia.com

What Is the Quantity Theory of Money? Definition and Formula

Take a look at the tenets, assumptions, and challenges of one of monetarism's principal theories: the quantity theory of money.
www.investopedia.com www.investopedia.com
Click to expand...
Quantity is unchanged in your understanding. Velocity is changed.

It doesn't bother me if you agree of disagree. I wanted to understand how you think more than what you think. I offered mine for your consideration and not to debate.
 
#11,392
#11,392
McDad said:
Quantity is unchanged in your understanding. Velocity is changed.

It doesn't bother me if you agree of disagree. I wanted to understand how you think more than what you think. I offered mine for your consideration and not to debate.
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It doesn't sound like you think who spends the money makes any difference? Between consumers, businesses or the government? You don't think the variable of household disposable income matters when it comes to consumer demand?
 
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#11,393
#11,393
BowlBrother85 said:
It doesn't sound like you think who spends the money makes any difference? Between consumers, businesses or the government? You don't think the variable of household disposable income matters when it comes to consumer demand?
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Why would it matter who spends the money as long as no additional money is created? The different levels of government are probably the biggest purchasers of goods in the country.
 
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#11,396
#11,396
hog88 said:
Why would it matter who spends the money as long as no additional money is created? The different levels of government are probably the biggest purchasers of goods in the country.
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Once again, I am also talking about more money being created .... I'm not holding that as a constant.

As to whether the price of a good or service is changed by an increase in household disposable income .... that would depend on the nature of the product.
 
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#11,397
#11,397
hog88 said:
One of the waitresses in ours has a smokeshow of a body but tats everywhere along with piercings in her nose, lip, eye and probably some in other places. I keep threatening to ask her "when did your poor life decisions begin". Wife has threatened me not to.
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Probably does back to daddy. I try never to pizz off the person who is handling my food. You might pivot to “tell me the story of that interesting tramp stamp”.
 
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#11,400
#11,400
DC_Vol said:
Probably does back to daddy. I try never to pizz off the person who is handling my food. You might pivot to “tell me the story of that interesting tramp stamp”.
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Yeah, I don't have the stones to ask that question. Especially in front of the Mrs.
 
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