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Fed in 'Full Recession-Creating Mode' Comes Under Fire for Another Interest Rate Hike | "Raising interest rates puts the burden of fighting inflation on low-wage workers," notes former Labor Secretary Robert Reich. "For once, let's take aim at an actual driver of inflation: corporate profits." (commondreams.org)

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[–]Global-Somewhere-917 781 points782 points  (111 children)

I get why they raise rates to control inflation, Econ was my undergrad major.

But what infuriates me is that they let things go crazy and kept rates artificially low for Trump for four years. That's one of the main reasons we're in the situation we're in now.

And a lot of this inflation was artificially created by a combination of poor logistics management in the supply chain and by good old-fashioned price gouging and collusion.

[–]acousticburrito 405 points406 points  (40 children)

Exactly. More people need to realize that this was so predictable starting in at least 2018. Trumps economic policies were idiotic and Powell was weak for letting trump bully him into keep rates low.

[–]down_up__left_right 186 points187 points  (32 children)

The whole point of giving over monetary policy to a quasi private institution is so it can supposedly be independent of the rest of government, but the Trump years just showed that isn’t true.

It really calls into question the way US monetary policy is done.

[–]Lump1700 99 points100 points  (21 children)

It’s done by partisan hackery, just like everything else in the US

[–]Th3Seconds1st 116 points117 points  (7 children)

1 trillion dollars got injected into the stock market during the initial panic of the COVID shutdown. Congress never voted to allocate it, it was issued by the treasury and that money fucking burned. You wanna talk about why we have inflation? Why don’t we talk about why you and I and everyone else wasn’t given three thousand dollars each of stock for the money we gave them without our consent to do so.

Also, Powell cut rates for Trump like 3 times to “boost” the economy which was already soaring. Once only months before COVID. If we had saved those rates and cut them during the COVID breakout they would’ve been a lot more likely to soothe the market.

[–]anaxagoras1015 57 points58 points  (3 children)

Dead on. That 1 trillion during covid, much more was injected then that before covid.
Of course, the blame is being put on the people.....it's because the people got all that stimulus and their wages went up (still at a rate increase less than inflation). That leads to people in power and ordinary people to take an austerity mindset.

[–]Lump1700 42 points43 points  (1 child)

“The serfs are getting uppity, time to knock them down a few pegs”

[–]sabbytabby 26 points27 points  (0 children)

100% this. Any college freshman halfway through their 1st semester of macro economics could see that inflation was not the result of an overheated economy of but of supply shortages. This is a slapback on modest wage pressure.

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    [–]the-mighty-kira 10 points11 points  (1 child)

    That’s part of it, but there are so many other reasons.

    • The move to JIT inventory has made the supply chain extra vulnerable to demand shocks.

    • Mass consolidation of companies over the past 30 years means there’s less downward pressure on costs, so when prices go up for any reason, it takes far longer for them to drop

    • The war in Ukraine has greatly driven up energy prices, and that’s an input into every other bit of the economy.

    [–]Lump1700 11 points12 points  (0 children)

    Yep, they have us fleeced into not seeing the actual struggle/party lines which is that of moneyed interests and those not represented by those.

    [–]loondawg 21 points22 points  (12 children)

    That is not the default and wasn't for decades. There were certain institutions that remained reasonably neutral such as the Courts and the FED. Trump destroyed that.

    [–]Prestigious_Plum_451 16 points17 points  (6 children)

    It shows how much of government function relies on people acting in good faith to govern, and "gentleman's agreements" therein... which all fall apart when you get a bad actor in to the mix.

    [–]thatnameagain 7 points8 points  (5 children)

    Everything is a gentleman's agreement, even law. Why do we enforce the law? Does the power of christ compel us? Nope, it's because people take on jobs to enforce it and are expected to do so in good faith. There's always a means of oversight (the senate can remove the head of the fed, the people can vote to change the senate, etc) but ultimately it relies on people making good-faith decisions, including the voters.

    [–]Prestigious_Plum_451 0 points1 point  (4 children)

    Everything is a gentleman's agreement, even law. Why do we enforce the law? Does the power of christ compel us? Nope, it's because people take on jobs to enforce it and are expected to do so in good faith.

    You do realize what was described above is about exactly that... not sure what the point in your post really is...

    You also have a vast chasm of a difference in between written law and procedure with means of enforcement, and what is an expectation in between to follow generally accepted standards of conduct. One should not pretend that those are equitable.

    Being said, what it takes to have functional governance get done among parties that are willing to work together past and beyond what is written in to law and procedure. That is the "gentleman's agreement".. it all falls apart when one party refuses to negotiate, or otherwise acts in bad faith.

    Mitch McConnell can only be trusted to act in bad faith less it benefits him directly to do otherwise. If he so chooses that he does not want to do his job, or wants to halt functional governance form occurring there are no rules in play to stop him from doing so, or to ensure he does his job right in service of his constituents, his state, and the broader nation. Trump and his like don't care about functional governance, and are only after what the powers established under law can do for them, and them alone... which is not a recipe for functional governance either. This leads to the following bit;

    There's always a means of oversight (the senate can remove the head of the fed, the people can vote to change the senate, etc) but ultimately it relies on people making good-faith decisions, including the voters.

    There is little to no functional existing oversight in many stages and that is the problem. Just because you can have "means" to have oversight does not mean it exists. Systems of oversight can also be created or improved on when deficiencies are found if all parties agree to it, but if not... The "gentleman's agreement" therein is the function of expectation, and trust that everyone tries to do the right thing, whereas what we have seen 1st hand are the consequences of that trust being violated for the benefit and at the behest of bad faith actors.

    Voters? there are around 28-35% of the population who can not be trusted to even vote in their own best interest and a larger portion after that don't even know how government, and governance works outright... voters can not be called a measure of oversight outright. In a perfect world they can be that, but as things are in reality voters also help introduce the very same variables in to the equation than undermine how everything works. Just look at how many bad actors keep getting voted in to office over and over again.

    edit: context/clarity

    [–]thatnameagain 1 point2 points  (1 child)

    You do realize what was described above is about exactly that... not sure what the point in your post really is...

    Well my read on all the "wow look how much our gov is just based on 'good faith agreements'" discussion since 2016 is that there's an implicit "we should lock that down and codify it instead" argument being made. Sometimes this makes sense, other times not, but I guess I'm tired of hearing that sentiment brought up because it just strikes me as a little naive.

    Voters? there are around 28-35% of the population who can not be trusted to even vote in their own best interest... voters can not be called a measure of oversight outright.

    Well, it's a democracy so the voters will always be the final backstop on oversight until we stop being a democracy in...(checks watch)

    The ultimate gentleman's agreement is that the electorate won't be a bunch of fucko dipshits, and there's no getting around that problem.

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      [–]Charliethebrit 4 points5 points  (1 child)

      Given that the Supreme Court overruled FL's state supreme court's order for a manual recount after the 2000 election, the supreme court has been partisan for decades, it's just now becoming much more visible with this court.

      [–]anaxagoras1015 7 points8 points  (2 children)

      The Fed was never neutral, they have always served the will of private interest. Which by association makes them partisan to the right.

      [–]TheWayNorthAmerica 1 point2 points  (1 child)

      I’m a cynic I guess but the whole idea of independence for the Fed never made sense to me. Monetary policy SHOULD be predicated on political accountability—just like all economic policy.

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        [–]jackstraw97New York 17 points18 points  (6 children)

        Yes and no.

        The fed has had the money printer turned on since the 08 recession.

        I remember there being talks of rate hikes in 13-14 ish when the economy had been recovering, but Yellen (and others) thought the recovery wasn’t where it needed to be yet, so they kept the printer on (aka low rates and high quantitative easing).

        Powell basically continued from where Yellen left off.

        This isn’t as partisan of an issue as people are making it out to be. Inflation was always going to happen, it was just a matter of when.

        That’s what we get for pursuing an “easy money” strategy for the better part of a decade and a half.

        [–]zxern 8 points9 points  (1 child)

        Your right it was never partisan it was always a classist policy.

        [–]anaxagoras1015 1 point2 points  (0 children)

        It's still partisan just partisan to both parties, as each established party acts as an arm of private interests.

        The printers where turned on for the sake of private interest, and stayed on for their sake, and the parties allowed it because they are controlled by private interests.

        We made an easy money strategy for private interests, and the people paid in inflation. It has been successful for who it was made to be successful for, but now the people are really feeling the symptoms of it since they pay and all.

        Partisan to private interest and the parties which support them, the fed is not partisan the people. No one really is.

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          [–]slinkymello 4 points5 points  (1 child)

          Econ undergrad and grad student here, what really annoys me is the Fed's editorial comments about pain

          [–]Jimwdc 2 points3 points  (0 children)

          What are you talking about my man. You ever sit for long periods in an ivory chair? IT hurts.

          [–]StromWashington 24 points25 points  (0 children)

          The amount of blatant price fixing through convos just during earning reports is fucking ridiculous.

          [–]loondawg 16 points17 points  (0 children)

          One of the main reason we are in this situation now, probably to the biggest reason, is corporate greed; windfall profits.

          This is one of the few times when I agree with Romney that corporations are people: rich, greedy people.

          [–]thebinarysystem10 2 points3 points  (0 children)

          Jpowell: I have one tool in the toolbox and I am going to keep using it until I realize we overdid it.

          [–]idontagreewitu 48 points49 points  (6 children)

          and kept rates artificially low for Trump for four years.

          and Obama for 8. And Bush for 6. There were a bunch of drastic changes made after 9/11 and then again after the 2008 crash to stabilize the markets, temporary changes, that never went away. We had near 0% interest rates from 2002-2021

          [–]PasteeyFan420LoL 28 points29 points  (1 child)

          Seriously, for most of the 21st century borrowing has essentially been free. It's likely that during the last 20 years or so a lot of what we'd come to understand as foundational concepts in economics have just not been true because they were based on a system where borrowing, investing, and saving worked differently.

          [–]Ok-disaster2022 12 points13 points  (0 children)

          Looking at historical rates and then the ones after the great recession it's actually quite disturbing. Moderate inflation is good, it encourages spending over sitting on money. Runaway inflation and deflation are both bad. It's been massive stagflation for almost the last decade and any profits were taken by those on top.

          [–]loondawg 24 points25 points  (1 child)

          We had near 0% interest rates from 2002-2021

          Banks did. We didn't.

          [–]MarkHathaway1 6 points7 points  (0 children)

          Instead of supporting companies for that long there should also have been changes in law which would push out zombies and instill more competition and reinvestment. Higher interest rates (to a point) can help with that. Look what it's doing to the idiotic housing market. Higher rates, fewer construction loans, fewer buyers, crashing prices -- back down to realistic levels.

          Kill all the ZOMBIES.

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            [–]Stock-Hippo9570 2 points3 points  (3 children)

            But what infuriates me is that they let things go crazy and kept rates artificially low for Trump for four years. That's one of the main reasons we're in the situation we're in now.

            I completely agree with you, but I've never been able to explain this to people well enough that it doesn't sound like blame shifting. Any suggestions?

            [–]Prestigious_Plum_451 2 points3 points  (0 children)

            Yah, and not to even mention their shit tier reasoning about how things like their tax cuts would somehow magically pay for themselves through clearly unsustainably high expectation about economic growth. Then handicapping the longer term economic outlook by keeping interest rates artificially low.

            Like seriously... its all some shit tier short term "me and mine right now no care for tomorrow" level of thinking and application of policy.

            And a lot of this inflation was artificially created by a combination of poor logistics management in the supply chain and by good old-fashioned price gouging and collusion.

            Also idiotic shit like the trade wars, and tariffs Trump wanted to play fucky fuck games with. "China pays for the tarrifs".. no.. the Us consumers pay for those, and they undermine US companies competitiveness on the markets for the goods and services they produce. Then we got covid in to the mix which made certain things like known long term systemic weaknesses in supply chains come to a point.

            Nothing like using magical thinking, and ideological puritanism to create and justify policy while having 0 care for the consequences of such.

            [–]down_up__left_right 7 points8 points  (3 children)

            The point of giving over monetary policy to a quasi private institution is so it can supposedly be independent of the rest of government, but the Trump years showed that isn’t true.

            The Fed wanted to raise rates during a boom. Trump knew that keeping rates low would help send the stock market higher and higher so he successfully bullied the Fed into backing down.

            [–]Global-Somewhere-917 7 points8 points  (2 children)

            And the hilarious thing is that conservatives are just convinced that the Fed is against them.

            [–]Eli_eveColorado 12 points13 points  (23 children)

            If EU inflation was 9.1% and this is a global issue, how could it be possible that anything we do with US monetary policy could have any effect on the situation?

            [–]Global-Somewhere-917 6 points7 points  (21 children)

            Ok, I'll play: So why are we raising rates now?

            [–]echomanagement 19 points20 points  (5 children)

            I think you are totally correct - this was a clusterfuck that mostly could have been avoided in 2018, but Trump wanted "his stock market" to soar because big numbers are better than little numbers. I say mostly because a global correction was inevitable, although FREE USA MONEY was a temptation to global buyers who are now getting screwed because their local currencies are now trashed.

            [–]Global-Somewhere-917 18 points19 points  (4 children)

            Plus his "strong stock market" was extremely overvalued, people were even saying it at the time. And the only reason it kept going up was because the GOP was giving corporations and the wealthy seemingly endless funds to buy up as much of it as they could.

            [–]KingOfTheBongos87 3 points4 points  (3 children)

            The stock market was overvalued since the end of the Obama administration. We were supposed to see a downturn 8-10 years after 2008. That didn't happen. So now here we are.

            [–]Global-Somewhere-917 3 points4 points  (1 child)

            That downturn didn't happen because they were artificially pumping it up with taxpayer money.

            [–]MarkHathaway1 6 points7 points  (0 children)

            Reaganomics, 2008-10 recession QE money, Trump money, etc. It's a terrible trap like inflation in the old-fashioned way. It leads to crazy things like housing and rent going sky high even when demand is steady.

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              [–]Eli_eveColorado 3 points4 points  (14 children)

              Exactly what I’d like to know. I assume the people making these decisions know what they’re doing (I certainly don’t) so I’d love a layperson’s explanation of what they they the root issue is and how what they’re doing will help.

              [–]e_muaddib 18 points19 points  (13 children)

              Go to r/Economics and you will find it explained many times. The Fed is raising the interest rates at which banks can borrow, which banks transfer onto consumers. With higher interest rates, consumers are less likely to borrow which lowers demand. Inflation is a product of supply and demand. With current geopolitical issues, supply is low, demand (while interest rates were low last year and before) was high = high inflation.

              With Fed-created lower demand (raise interest rates), they are attempting to decrease inflation. This has been the Fed’s plan and they have stated as such.

              By the way, I’m paraphrasing hard and my understanding is limited. If any of the above is off-base or incorrect, hopefully someone more knowledgeable will correct me.

              [–]Eli_eveColorado 5 points6 points  (4 children)

              Thanks, that does match with my understanding of what these actions should do. However the US does not exist in a vacuum, and with the EU (and presumably other areas of the world too?) experiencing the same inflation, I can’t help but wonder if reducing US demand will have much effect on reducing global demand and therefore reducing our inflation situation, regardless of how sizable a chunk of the global economy we are. Perhaps the Fed are coordinating with other economies and I’m just not hearing about it? Yeah, I’ll check r/Economics , thanks.

              [–]just_some_Fred 2 points3 points  (0 children)

              Other central banks are run with the same remit that the US Fed is, and they're taking generally the same approach based on their currencies. The EU just hiked interest rates as well, for example.

              The absolute biggest driver was the simultaneous drop in supply of most products combined with the sharp spike in demand that was caused by Covid. Supply chains will be screwed for years still, and that means prices for consumer goods will go up until we come up with a better solution to the fairly fragile system that we had before.

              [–]e_muaddib 1 point2 points  (0 children)

              Yeah, with regard to other nations and their fiscal policies and how those coordinate with US policy..I’ve no clue. Would be a fun rabbit hole to go down. If I was digging I might start with oil because it controls the cost to move goods. Then maybe the chip shortage.. other than that,.. no clue, my friend.

              [–]Clovis42Kentucky 0 points1 point  (0 children)

              I'm guessing part of the answer here is that US monetary policy has a big affect on the rest of the world, and also that central banks throughout the world made similar decisions to the US fed.

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                [–]jackstraw97New York 1 point2 points  (3 children)

                You’re pretty much bang-on, but quantitative easing is also a factor that the fed can manipulate.

                https://en.m.wikipedia.org/wiki/Quantitative_easing

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                    [–]sullenosityGeorgia 6 points7 points  (6 children)

                    Fascinating find here, just skim this Wiki page:

                    https://en.m.wikipedia.org/wiki/U.S._economic_performance_under_Democratic_and_Republican_presidents

                    The U.S. economy does better under a democratic presidency on all surveyed accounts. It mostly comes from one study, so that should be kept in mind, but the data is still striking.

                    Economists don't know exactly why but the suspicion is that democrats alter economic policy by examining effects historically, unlike Republicans, who tend to lean on the same approaches (tax cuts, etc.), and that democrats also make people overall more optimistic for the state of the economy in the short-term future.

                    [–]Global-Somewhere-917 12 points13 points  (5 children)

                    It could also have something to do with the fact that conservative fiscal policy is basically just a smash and grab looting.

                    [–]sullenosityGeorgia 8 points9 points  (4 children)

                    Funny enough, another statistic they took is that corporate earnings go up with a Democrat in office. So Republican policy doesn't even succeed at the one thing it is engineered for.

                    [–]OpenMindedScientist 4 points5 points  (0 children)

                    Yup. My father, a Republican, still refuses to believe that. Even though, when asked specifically how his company did under different presidents, he can quote the profit increases / decreases in correlation with Democrat / Republican presidents respectively.

                    [–]m0nkyman Canada 0 points1 point  (0 children)

                    It’s not engineered to make rich richer. It’s engineered to increase the difference between the rich and the poor.

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                      [–]flyingpallascat 1 point2 points  (0 children)

                      Don’t forget politics; as you mentioned in the case of Trump, they wanted him re-elected, so rates were kept low. Basically, they’re trying to damage Biden, and thus, democrats, before the midterms.

                      [–]Weekend_Expert 2 points3 points  (0 children)

                      Make more people poor to “cooldown” the economy. -the fed

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                        [–]Azozel 208 points209 points  (29 children)

                        The title sounds great but what tools does the fed have to take aim at corporate profits? This isn't rhetorical, if these tools exits I'd like to know.

                        [–]kev11nIllinois 68 points69 points  (14 children)

                        the title says the fed did so and so but "LET'S take aim..." so I think the author means congress needs to act

                        [–]Azozel 27 points28 points  (9 children)

                        I getcha. I assumed since they started out my critiquing the Fed, they meant the Fed had an alternative other than raising interest rates.

                        Obviously, it's just a headline to get attention then cause we all know congress doesn't have the support necessary to do anything to corporate profits, might as well be wishing into the wind. Congress won't go after the guys supporting their campaigns.

                        [–]Monotonosaurus 29 points30 points  (8 children)

                        Congress won't go after the guys supporting their campaigns.

                        You know, the realist in me agrees with you, but I've decided to stop being an apologist for their inaction. We need to stop repeating this narrative because it enables them to do nothing and keep the status quo. Expect nothing, get nothing. Instead, we should change how we frame our language. Instead of "Congress will not" we need to change the rhetoric to "Congress needs to".
                        The former takes a defeatist stance while the latter offers a directive.

                        [–]NBKFactor -5 points-4 points  (6 children)

                        Well Congress won’t. These people are bought by the corporations. They fund their campaigns. I mean we can’t even get Congress to be honest about their portfolios.

                        [–]Monotonosaurus 1 point2 points  (5 children)

                        You realize that saying this does nothing to actually better your situation, right? I just hear the same bunch of moping around on Reddit and it's getting tiresome. I vote and participate, but I'll be damned if I also cause others to feel hopeless and stuck due to my word choices on the internet.

                        The whole "prove me wrong" stance is stupid and perpetuates inaction. Change your language to be active. Congress ISN'T doing things now, sure. But you saying Congress won't for the foreseeable future is just shooting yourself in the foot because it makes you seem complacent with the situation. If you want Congress to do better, stop prematurely lowering your standards for them through pessimistic language.

                        [–]NBKFactor 0 points1 point  (4 children)

                        Sorry if history has made me cynical, but saying Congress will do it doesn’t mean shit. Congress doesn’t care what language I use on a post that will be dead by tomorrow on reddit. In fact the amount of people who will see my comment is negligible.

                        Until we vote out old people in Congress we won’t see any dramatic changes when it comes to how the government handles money. People like AOC young and energetic aren’t in anyone’s pocket. People like Pelosi have been in corporations pockets for decades.

                        You thinking the current composition of Congress will change that is just wishful thinking regardless of language used online. We need new blood in Congress.

                        [–]Monotonosaurus 5 points6 points  (0 children)

                        My words here don't affect Congress directly, and it is not my intention to. The language I put out here is being read by others - others who have the power to vote. However, if these same people are bombarded with defeatist language constantly, they will assume the doom and gloom is already said and done, and perhaps they will be unmotivated to even go out and vote. That has a very real and very direct effect.

                        I agree that voting old people out of Congress will hopefully ignite change. I am progressive, after all. However, none of this is relevant to my main point. Your follow-up, in-depth response sheds a lot more light and direction compared to the defeatist rhetoric of "Congress will do nothing," which make it seem like a dead-end conversation. After all, you do believe that Congress CAN do something - just that it will take a few extra steps to get to that point. That gives us, the readers, actionable steps to follow.

                        I guess I am just sick of seeing the same, low effort, defeatist responses here on Reddit.

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                          [–]Azozel -2 points-1 points  (0 children)

                          I'm a pessimist and a realist, I can't take that stance, it's just not in my nature. I don't disagree with you however.

                          [–]FroggyStyleEnt 1 point2 points  (1 child)

                          Seems rather poorly timed since congress will be done soon enough until the new congress.

                          [–]kev11nIllinois 0 points1 point  (0 children)

                          yes, that's very true. Common Dreams is an independent news site that is typically far more progressive than most elected officials, so the article is more of an appeal to the people to steer the conversation that way. Unfortunately those in congress are more aligned with business than people, so this is only wishful thinking, for now.

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                            [–]Fritzed 27 points28 points  (1 child)

                            The fed is using pretty much the only tool they have in pretty much the only way they can. Congress could do a lot by taxing the ultrarich on all of their forms of income, but republicans would never give a single vote for that.

                            [–]Bensemus Canada 6 points7 points  (0 children)

                            Neither would most of the dems. On this issue they are mostly in agreement.

                            [–]SlipSpace21 23 points24 points  (2 children)

                            Exactly. The Fed has no tools to do anything of the sort, this is Congress' job.

                            There has been an ongoing issue between Congress and the Fed over the last few decades where Congress refuses to partake in its fiscal policy side of economic governance (because political consequences) and attempts to make the Fed pick up the slack with their very limited tool set on the monetary side. This has led to things like the Fed purchasing municipal bonds (unprecedented) and expectations that in the future they may even purchase equities to prop up markets.

                            This is well and good from Congress' perspective because the Fed can save the day or take the blame and either way no Congress critters have to answer for it to their voters. However, as usual, they are being myopic. Forcing the Fed to use its blunt tools to address economic crises only ultimately ends in one of two ways:

                            1. People take additional outsized risk they otherwise wouldn't take out of belief that the Fed will prop up the market, which eventually erodes the value of the market because it isn't based anything anymore but Fed magic or

                            2. The Fed realizes this reality and at some point refuses to do Congress' job any further, causing a panic and crash.

                            Either way, it's stupid. Reich certainly knows this and I'm sure his anger is focused more on Congress than on the Fed.

                            [–]nic_andros_speaks 5 points6 points  (4 children)

                            taxing windfall profits for corporations and extremely high net worth individuals is a much more effective means of reducing the money supply and thus inflation. “some more news” has a great segment on this.

                            https://youtu.be/vgEpzumACUc

                            edited for typo

                            [–]TheTrenchMonkey 1 point2 points  (1 child)

                            Literally not something the federal reserve has any ability to do.

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                              [–]Correct_Influence450 0 points1 point  (0 children)

                              Taxes

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                                [–]DragoneerFAVirginia 130 points131 points  (30 children)

                                Inflation wouldn't be near as bad if we could afford rent. Corporate profits are one thing but the property value is another. The value of houses in my neighborhood has doubled in the past seven years. Earnings haven't changed.

                                It's all a mess, but the unrelenting greed is hurting us all.

                                [–]the_turdfurguson 90 points91 points  (2 children)

                                …. That’s directly tied into corporate profits. The number of real estate investment firms who in REITs, QOFs, and 1031s obscene. There are very few locally owned apartment complexes anymore with prospectuses written that guarantee increased rents for increased distribution payments to investors. 1031s specifically allow their investors to turn their RE capital gains into a tax deferred vehicle.

                                Then you get into new homes in the US being 25-30 million a decade going back to the 50s. It was 5 million in the 2010s. It’s far more profitable for major housing developers to build 4-5 bd McMansions instead of more affordable starters at 3 bd.

                                [–]External-Tiger-393 31 points32 points  (0 children)

                                To be frank, the US isn't a prosperous country for most people anymore. No one I know who is under 50 can afford a "starter" home, and people talk about economic goals that should be very achievable as if they should require an amount of work that a lot of people can't do; and even then those goals aren't guaranteed (working 60 hours a week and living in a high crime area with 3 other people come to mind as suggestions).

                                For example, my sister is a data intelligence analyst. She's one of the most qualified people I know and works in a highly in demand field. She is still having trouble finding a one bedroom apartment that she can afford to rent. Even basic financial stability (being able to afford housing, health care, small luxuries like a yearly vacation, and having the ability to save some money on top of that) are out of reach for her.

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                                  [–]ConeCrewCarlConnecticut 32 points33 points  (18 children)

                                  Mostly because large investment firms buy up properties (apartments, Condos, and houses) then charge the maximum rent they can to satisfy profits and shareholders. This in turn sets the rates for that area as more properties are owned by investment firms (and rented out), that leaves less and less inventory for the individual to buy a home which drives up the price through supply and demand. The price of the homes go up, hence the price of rent goes up.

                                  https://slate.com/business/2021/06/blackrock-invitation-houses-investment-firms-real-estate.html

                                  [–]crazicus 4 points5 points  (17 children)

                                  The bigger issue is we’ve just been underbuilding housing for decades.

                                  [–]thatnameagain 2 points3 points  (13 children)

                                  Underbuilding low income / middle income housing, maybe. There are tons of unoccupied houses across the country currently.

                                  [–]crazicus 1 point2 points  (12 children)

                                  Underbuilding all housing, especially in urban centers. You look at the development patterns for major cities for the past few decades and you’ll see stuff like 4 new jobs added for every unit of housing added. That’s not sustainable, and it’s only going to push existing residents out.

                                  Also that vacant homes thing is kind of a myth, or at least there’s not as many as you’d expect. The number of “vacant” homes also includes vacation homes, homes in the middle of nowhere or in collapsed communities, and homes not fit for human habitation, not to mention the ones that are simply between occupants. When you restrict it only to homes that are long-term unoccupied with no habitability issues and near jobs and services, you’d see the actual vacancy rate is far lower than what the raw numbers suggest

                                  [–]thatnameagain 1 point2 points  (11 children)

                                  I basically agree with you. My point is more that if you are higher-income, you'll very likely find your house, whereas if you are low or middle income, you'll very likely be screwed. The supply is available to those who can afford it. But yes I agree that more building is necessary, I just think it needs to prioritize affordability. We don't need to worry about making housing in urban centers more friendly for upper-income earners, which seems to be currently what most of the construction happening is aimed at.

                                  [–]PrincessElonMusk 10 points11 points  (2 children)

                                  It can be both.

                                  [–]Uncle_johns_roadie 1 point2 points  (0 children)

                                  Corporate real estate investment is a minority share of real estate ownership in the US. Individual owners are by far the biggest residential property owners in America.

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                                    [–]maddprof 21 points22 points  (0 children)

                                    The concept of "market rate adjustment" for rent should be against the law.

                                    My apartment complex (corporate own/ran) just increased by the maximum amount (thank you CA for your rent increase laws) using "market rate adjustment" as their reasoning.

                                    The majority of their input costs to maintain this place did not increase. Mortgage should still be the same (if they even bothered with a loan to buy this building). Limited to no actual maintenance (building was just remodeled last year). And I would assume staff costs can't have increased enough to justify the across the board increase.

                                    So it's pure greed. That's it. We're charging you more just because we can.

                                    [–]TheZooDad 2 points3 points  (1 child)

                                    That’s literally ALL OF CAPITALISM, baby! This is exactly what we have been supporting for years and years, the unsustainability of “unlimited growth” just starting to catching up to us now.

                                    [–]Uncle_johns_roadie 0 points1 point  (0 children)

                                    Capitalism would build more houses. Boomer NIMBYism has more or less stopped meaningful new construction to meet housing demand.

                                    [–]FroggyStyleEnt 0 points1 point  (0 children)

                                    My house has gone up 33% in value since construction in 2020. I can barely afford the property taxes now, which they keep raising on me for services in the city (I live in the county). Good stuff.

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                                      [–]Bonny-Mcmurray 95 points96 points  (28 children)

                                      Can we take aim at corporate profits without congress?

                                      ETA: It seems like we're mostly in agreement that corporate profits can't be targeted without congress. Since the current 50/50 congress probably won't vote for this, and a republican congress definitely won't vote for this, you have to wonder what agenda is being pushed by strongly insinuating that the current fed is intentionally creating a recession and not simply doing its best control inflation with the tools it actually has available. Do we not want to control inflation, or do we not want positive feelings about the economy going into midterms?

                                      [–]SidewaysFancyPrance 28 points29 points  (4 children)

                                      Right, the Fed only has a limited number of tools available, and that ain't one of them. People need to point the finger where it belongs: the people in Congress who are obstructing any legislation that hurts corporate/billionaire profits.

                                      [–]jhpianistArizona 15 points16 points  (1 child)

                                      And while people point one finger at those in congress, their other fingers point back at themselves for voting those selfish fascists into office in the first place. VOTE

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                                        [–]0002millertime 25 points26 points  (7 children)

                                        Yes, with boycotting, but it's not easy.

                                        [–]Gamilon 21 points22 points  (6 children)

                                        Given how nearly every product or service available is inevitably tied to only a handful of conglomerates it's nearly impossible

                                        [–]BeyondElectricDreams 8 points9 points  (0 children)

                                        And this is why Capitalism is broken.

                                        Conglomerates should not be a thing. A corporation that large is immune to the pressures that are supposed to keep it's behavior in check.

                                        It stifles competition, and it prevents effective boycotting. How can you boycott a company that owns half the grocery store under myriad sub brands? You could actively try to protest (cough Nestle cough) and still wind up "supporting them" because you didn't realize that product L was a subisdary of the Q company who is themselves owned by Nestle.

                                        Trust busting needs to have happened ages ago because there's far, far, FAR too many conglomerates. We've moved to the point where we only consider using it if there's a true monopoly, but the truth is these oligopolies are just as damaging to the economy as any monopoly.

                                        When corporations compete, we win. When a corporation becomes immune to outside pressure due to it's immense size, available capital, and diversified interests, we lose, because they can essentially price as they want and do as they want.

                                        [–]SeeMe_After_Class 15 points16 points  (4 children)

                                        I just stopped buying shit for the most part besides the necessities, and even then I try to buy locally. When I can, I make my own stuff, whether it's furniture or clothing or food or whatever. People buy way too much crap as it is. I don't go anywhere--what sane person would when republican stupidity and terrorism is running rampant? I walk instead of drive when I can. It's really not that hard to stop buying crap. Sure, you're still going to have to cough over money for some stuff, but I think people are just too addicted to consuming for a boycott to really work.

                                        [–]Gamilon 7 points8 points  (0 children)

                                        Followed a similar path years ago, but COVID didn't help. Still, I'm glad I did a hard purge of "stuff", since doing that it has been a lot easier to question purchasing impulses and looking to repair or do without when anything breaks.

                                        The hardest part is time. As a side note, money is the solution to a lot of things in terms of being alive in the US, but the main thing it buys you is time. Whether by convenience or freedom from overwork, you have the time resources to make repairs or whatever. So I don't feel antipathy for most who just buy stuff. Rather I feel antipathy for the system in general that has created a situation where wasteful consumerism is almost a necessity

                                        [–]meTspysballCalifornia 4 points5 points  (0 children)

                                        The only answer is to campaign and organize and vote for people that will change the current system. We consume the way we do to cope with the stresses the system puts on us. We don’t have the time or bandwidth to even make healthy meals every day (hence fast food). 40+ hr work weeks are not necessary and they are killing the planet. Our productivity has outstripped necessity and it’s easy to quantify in the accumulation of wealth at the top.

                                        [–]tommles 2 points3 points  (0 children)

                                        I think people are just too addicted to consuming

                                        It's as if industries had a desire to keep up WWII production so they just started brainwashing people to buy useless shit.

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                                          [–]MidnightMoon1331 6 points7 points  (8 children)

                                          Only by not buying from them, so no.

                                          [–]MAGA_is_NAZI 1 point2 points  (7 children)

                                          Yep. Too many rubes that must have the newest [blank].

                                          [–]ZardozSpeaks 6 points7 points  (6 children)

                                          Groceries? Gas?

                                          [–]MAGA_is_NAZI 5 points6 points  (2 children)

                                          We all know it’s not groceries that I’m talking about and we all know that that’s not all Americans are buying. The gas companies can fuck right the fuck off but grocery company margins are actually pretty thin. Go to Homegoods right now. Go to Target or Walmart. People are buying way more dumb shit than gas and groceries. Halloween is coming up and cheap plastic shit is going to be flying off the shelves in a few weeks just to fill the trash cans the next week. We need a general strike to change things but Americans must consume.

                                          [–]ZardozSpeaks 3 points4 points  (1 child)

                                          You’re putting the focus on consumer goods, but you can’t deny that staples have doubled or tripled in price. As has rent.

                                          [–]SeeMe_After_Class 0 points1 point  (2 children)

                                          Most of my groceries are locally produced, and I do things like make my own bread, grow my own veggies, even buy meat from friends who raise their own chickens and goats. I avoid driving as much as I can, and I'll hopefully have an electric vehicle soon, although I still have to pay for electricity. I realize that's not possible for everyone, but I think the whole "it's impossible not to consume" mentality is propaganda from corporate America to try and make it seem impossible.

                                          [–]ZardozSpeaks 1 point2 points  (0 children)

                                          Most people are not in your position. It’s hard to avoid shopping for groceries and driving, especially in the US.

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                                            [–]greybruce1980 5 points6 points  (0 children)

                                            I mean, eventually we will. After enough of us starve to death, then we show up with rocks, machetes and pitchforks.

                                            [–]wioneo 1 point2 points  (1 child)

                                            It's really moronic to accuse the Fed of trying to create a recession. The actual problem is that we're probably not fighting inflation effectively because they're going slow on rate hikes to try and avoid a recession.

                                            I think we'd be better off long term if they ripped the band-aid off and jacked up the rate more quickly instead of this half-assery, but I'm not an economist.

                                            [–]daymanahhhahhhhhhAmerica 0 points1 point  (1 child)

                                            I don’t see how you could.

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                                              [–]SuperGenius98K 45 points46 points  (0 children)

                                              We used to do the windfall tax thing.

                                              [–]revfds 25 points26 points  (0 children)

                                              I don't know that the fed can do anything to go after corporate profits.

                                              Congress needs to act.

                                              [–]sunnydaysahead2022 2 points3 points  (1 child)

                                              Hey everyone - if you stop spending extra cash right now you can save it.

                                              Your savings will help cool the economy and you will have money when shit hits the fan.

                                              [–]RandomGameCritic 2 points3 points  (0 children)

                                              Love this man. His "Inequality for All" documentary was the first thing that truly opened my eyes about how bad America's wealth gap is.

                                              [–]spiderhead 21 points22 points  (28 children)

                                              They were talking about this on the radio yesterday. The theory is that it will slow corporate spending, which will slow wage growth, which will slow spending. The contempt with which they openly speak about regular people having financial flexibility is disgusting.

                                              [–]UsernameStressSouth Carolina 20 points21 points  (26 children)

                                              My blood boiled when I heard the phrase "wage inflation", like increased wages are something that needs "controlling" before the working class gets too comfortable.

                                              [–]Clovis42Kentucky 6 points7 points  (5 children)

                                              That's not what they mean though, it is simply a fact that wages increasing is inflationary. If people have more money to spend, then they will buy more stuff. That increases demand, which creates inflation.

                                              That doesn't mean it is bad, or the middle and lower classes are to blame for inflation. But it is basically impossible to discuss what causes inflation and how to control it without someone mentioning that rising wages are inflationary. So, you end up with people claiming that the Fed's main goal is to reduce wages, which isn't true. It has nothing to do with the working class being comfortable or being controlled.

                                              For the Fed, all they can do is basically raise interest rates which will probably slow the rate at which wages increase amongst other anti-inflationary effects.

                                              We can have the middle class continue to gain economic power while fighting inflation, but the Fed can't do that; only Congress can.

                                              [–]Nbuuifx14 5 points6 points  (1 child)

                                              Have you ever heard of supply and demand?

                                              [–]UsernameStressSouth Carolina -1 points0 points  (0 children)

                                              Yes

                                              [–]Fakeanneboleyn 4 points5 points  (1 child)

                                              I would like to know where people are getting increased wages. So far I’ve seen nothing in my field.

                                              [–]SelfDestructSep2020 0 points1 point  (0 children)

                                              Tech primarily.

                                              [–]Mother_Welder_5272 3 points4 points  (8 children)

                                              The thing is, in our economic system, that's truly how it works. In our dog eat dog, ultra competitive society, other people's wages going up hurts you. Because now the company has to charge you more for the shit they sell. If it eats into the CEOs profits, then he'll jump to another company.

                                              I don't say this in support of that. My point is that there is no "nice" capitalism. As much as centrists on this subreddit like to say they're fiscally conservative or whatever, the ugly truth under capitalism is that wages rising fast like this leads to faster inflation and is "bad".

                                              [–]KingOfTheBongos87 6 points7 points  (2 children)

                                              It doesn't just eat into "CEO profits" since most CEOs salaries are dependent on stock compensation.

                                              When you talk about "CEO profits," you're talking about stocks. And when you're talking about stocks, you're talking about the 401ks and pension funds of the middle class.

                                              Unfortunately there's no way you can raise wages for workers without eating into profits, which has a negative effect on workers' pensions/401ks.

                                              [–]UsernameStressSouth Carolina 2 points3 points  (4 children)

                                              They don't have to charge more when they have record profits. They can, therefore they will. Vultures.

                                              [–]nofrenomine 1 point2 points  (1 child)

                                              If CEO's and board members see a decrease in their take-home then that business is seen as failing. The economy is seen as failing.

                                              [–]SelfDestructSep2020 -1 points0 points  (1 child)

                                              You're wrong and looking at things too narrowly. There's no single cause of inflation, its a myriad of things and complex. And yes wages are part of it.

                                              [–]UsernameStressSouth Carolina 4 points5 points  (0 children)

                                              Yeah there're myriad ways to conceal their ravenous gluttony but it boils down to them being evil mother fuckers.

                                              [–]murphymcConnecticut 0 points1 point  (6 children)

                                              But that’s part of the problem, if everyone gets a raise it’s like no one did. That isn’t to say we don’t ALL need a raise, but having too many people get a significant raise too quickly will absolutely contribute to inflation.

                                              [–]UsernameStressSouth Carolina 1 point2 points  (5 children)

                                              The hell do you mean? If everyone gets a raise then we can more easily afford things. Prices need not rise in direct proportion. That's literally just a choice by these vampiric corporations

                                              [–]murphymcConnecticut 0 points1 point  (3 children)

                                              I'm not trying to be insulting here, but c'mon man, that's absurdly naïve. Even in an ideal world stores will still raise their prices when their costs go up, they don't work for free any more than we do.

                                              [–]UsernameStressSouth Carolina 1 point2 points  (2 children)

                                              They need not raise in direct proportion to the increase in wages. That is my whole point. The costs for products a company sells are not made up exclusively of labor.

                                              [–]murphymcConnecticut 0 points1 point  (1 child)

                                              Correct, not purely, but labor is the highest cost for virtually all businesses. Additionally, all their suppliers also probably needed to raise their prices to some degree to make up for their own labor increasing in cost, so even though labor isn't the only cost in business, everything increased in price.

                                              [–]UsernameStressSouth Carolina 2 points3 points  (0 children)

                                              If everyone's wages raised by 25% tomorrow, and the cost of all goods raised by 25% or higher, then that is evidence of manipulation, not reasonable responses to market forces.

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                                                  [–]MarkHathaway1 1 point2 points  (0 children)

                                                  I guess he was told by his masters to imitate Alan Greenspan of the 1990s. Raise the rate as far and as fast as possible. Kill the economy and give Rs a chance to make George W. Bush preznit.

                                                  [–]WhenIntegralsAttack 1 point2 points  (0 children)

                                                  These polemical titles aren’t doing anyone a favor. Moreover, I completely disagree with it.

                                                  There are two options: 1. Raise rates to combat inflation 2. Let inflation continue at this runaway pace

                                                  There is no magic “neither” solution. The economic environment we’re in is the result of a decade of quantitative easing along with global events such as the Russian invasion of Ukraine.

                                                  Powell is stuck between a rock and a hard place with the choices, but a 75 bp hike in rates hurts the middle and lower classes far less than 10% inflation does.

                                                  [–]Taco6JIndiana 1 point2 points  (0 children)

                                                  The fed is doing what it can do with the tools at its disposal in the face of congressional inaction. It's doing exactly what it did in the 80s. Price stability even in the face of short-term pain. I know they're aiming for a soft landing, but off of memory, I think they've only successfully done that once.

                                                  [–]tacs97 1 point2 points  (0 children)

                                                  Too many corporate sponsored elected officials. It’s a wonder how these people are elected. The people with the most money, should be the ones we all side eye and rethink. Why do we keep electing rich fuckers to keep fucking us over for other rich fuckers??

                                                  [–]mattgen88New York 6 points7 points  (4 children)

                                                  It's not the feds job to do that

                                                  [–]KingOfTheBongos87 -4 points-3 points  (3 children)

                                                  It is quite literally their job.

                                                  [–]mattgen88New York 4 points5 points  (2 children)

                                                  The Fed? Pretty sure it isn't. They control interest rates for lending to banks. Their directive is to stabilize prices and their tool is interest rates. They have no control over corporate profits. That can be affected by legislation and is squarely in congress's hands

                                                  [–]cwwmillwork 4 points5 points  (0 children)

                                                  I'm freaking out. Work in grocery retail and our sales have nose dived.

                                                  We had yet again another 20 cent price increase on candy bars. The small snickers, Hershey etc. $1.49 each. $2.39 for 1/2 gallon generic milk. People keep buying $5 in gas just to make it home and cards keep declining. Our theft has skyrocketed.

                                                  This is worst than 2020 COVID.

                                                  [–]Guilty_Jackrabbit 3 points4 points  (1 child)

                                                  "The economy" is really just a compulsive need for record profits.

                                                  [–]PaulMSand 3 points4 points  (0 children)

                                                  If the causes of inflation were internal to the US raising rates would make sense. They are not.

                                                  [–]ZenithXR 4 points5 points  (0 children)

                                                  TIL Jay Powell has the unilateral power to cancel inflation without any downsides whatsoever.

                                                  JFC. This article is the equivalent of the mentality that the president has a "gas price" lever in the Oval Office.

                                                  [–]Miss_Direction_Jr 4 points5 points  (2 children)

                                                  This isn't inflation... it's PROFITEERING.

                                                  These two things are NOT the same.

                                                  [–]Clovis42Kentucky 0 points1 point  (0 children)

                                                  I mean, it is still inflation. It doesn't matter the reason that the costs of goods is going up. That's inflation whether it is strictly because of supply, or only because people are willing to pay more and companies are taking advantage of that.

                                                  There's nothing more perfectly capitalist than a company charging the maximum amount the market will bear.

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                                                    [–]Sydardta 3 points4 points  (3 children)

                                                    Capitalism is destroying the planet and its people. It only cares about profits and shareholder value. It's unsustainable and literally killing us.

                                                    [–]epidemica 1 point2 points  (0 children)

                                                    Taxing corporate profits and issuing credits or rebates to workers is a better idea.

                                                    [–]font9aAmerica 1 point2 points  (1 child)

                                                    Inflation itself has a much more outsized effect on low wage workers.

                                                    If you make $10 an hour and a sandwich goes from $5 to $8 that’s much more impactful than for someone who makes $100 per hr.

                                                    [–]steinie1 1 point2 points  (0 children)

                                                    I agree with the headline, It’s never worked before, just throws us into a recession. Never worked before.

                                                    [–]FanOk6089 1 point2 points  (0 children)

                                                    “They Don’t Give A F*ck About Us-Tupac Shakur

                                                    [–]oldcreaker 3 points4 points  (1 child)

                                                    The intent of the Fed is lowering inflation by destroying the earning power (and subsequent consumer power), basically the lives of millions of Americans.

                                                    [–]kev11nIllinois 1 point2 points  (1 child)

                                                    Totally agree but I don't think the Fed, or Democrats, or Republicans, read common dreams which is too bad

                                                    [–]TI_Pirate 1 point2 points  (0 children)

                                                    Yeah, I don't understand how they can make any decisions at all without the kind of hard-hitting Twitter coverage commondreams provides.

                                                    [–]Fakeanneboleyn 1 point2 points  (12 children)

                                                    Genuinely asking a question because I’m not too versed in how this works. So if my salary has stayed the same, I own a car already, only have 1 credit card, and have no plans to own a home how will any of this help? Like my paycheck was always just enough, but it’s now even stretched thin. If it keeps going how am I able to continue to make my same salary work? I get this will help overall in the long run, but right now it’s getting pretty hard to make it work. Wealthy people can afford the rate hike, but with inflation working class people were already cutting down on unnecessary costs so why would they even be buying a house or new car right now? Won’t corporations just continue to buy up houses? They have the funds to do so.

                                                    [–]Clovis42Kentucky 2 points3 points  (3 children)

                                                    The fear is that the alternative to doing this will be even greater inflation. If inflation gets bad enough, people will just expect it to continue. At that point you end up in a cycle where inflation grows out of control. That happening would be way worse for you then simply having interest rates be higher than they've been for the last decade or so, but still much lower than several decades ago. Interest rates have been extremely historically low recently.

                                                    The Fed's main ability to combat this is raising interest rates to cool the economy. If it is harder to borrow money, then less stuff will be bought. If this works to decrease inflation, then that would be good for you.

                                                    The article points out that's not the only way to accomplish this. The economy could be slowed by stuff like taxes. I guess a more direct approach like price controls could be used, but in many cases that hasn't worked well. Congress would need to do that though, and that doesn't seem possible right now.

                                                    So, if you are in a position where you need to borrow money, this is bad right now but it might be better for you in the end if inflation goes down. If you don't need to borrow money, then it really isn't a huge problem, and inflation going down would be good. If you have extra money and just want to safely save it, then rates increasing is good. That's another way this fights inflation: maybe more people will save money instead of spending it.

                                                    [–]Fakeanneboleyn 2 points3 points  (0 children)

                                                    Thank you for the detailed reply! It helped me understand better.

                                                    [–]SFT-AYSF 1 point2 points  (0 children)

                                                    Venezuela and most Marxist governments tried price controls and it usually ends in disaster. Ven blamed grocers for high food prices and established fixed prices. The grocers were unable to buy their stock at those prices so shortages ensued. You look at everything from rent control to gas and you'll find where prices are fixed, scarcity ensues.

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                                                      [–]Lumpy-Dingo-947 5 points6 points  (6 children)

                                                      You’re expected to take one for the team in this plan. No joke.

                                                      [–]Miss_Direction_Jr 1 point2 points  (3 children)

                                                      How is becoming homeless or dying "taking one for the team"?

                                                      What "team" requires the players to die so the team owners can continue making the players die for profit?

                                                      Sounds kind of stupid.

                                                      [–]tech_hundredaire 3 points4 points  (1 child)

                                                      The owner class likes to message that "we're all in this together, one team" when, in reality, we are barely even people to them. We're just the unwashed dirty masses of plebes to exploit and use for their own profit.

                                                      They figure as long as we can be distracted with politics (fighting each other instead of them), tragedy (inundate us with terrible news to make us believe it's "not so bad"), and gadgets (new iPhone every year, folks!) then we are ripe for the picking.

                                                      The truly terrible thing is that they are right. Class consciousness does not exist in the U.S., and they very much want to keep it that way.

                                                      [–]Miss_Direction_Jr 3 points4 points  (0 children)

                                                      We aren't people to them. We're pixels on their bottom line.

                                                      Man. I hate to say it when you're right, but goddammit - you're right.

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                                                        [–]Fakeanneboleyn 2 points3 points  (1 child)

                                                        It’s always the non-wealthy taking one for the team. How much longer do they think they can bleed us dry?

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                                                          [–]Vitroswhyuask 0 points1 point  (0 children)

                                                          Exactly. Record profits so they raise prices because comsumers are expecting it. Time to increase corporate tax rates, repeal trump giveaway and increase the social safety net

                                                          [–]GSXRbroinflipflopsNew Jersey 0 points1 point  (3 children)

                                                          Raising interest rates also means the average American might be able to afford a home again though as it prevents corporate real estate entities from buying everything up simply because the rates were so low.

                                                          Interest rates go up, home prices go down.

                                                          [–]RheagarTargaryenColorado 2 points3 points  (0 children)

                                                          Higher interest rates hurt the first-time home buyer more than the company that can pay in cash. Those companies can just pay less as fewer borrowers can take out a loan to compete.

                                                          [–]King-Mansa-Musa 1 point2 points  (0 children)

                                                          But mortgage rates remain the same. More needs to be done for realistic home prices

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                                                            [–]Snoopy9876543 -2 points-1 points  (2 children)

                                                            Yep, class struggle waged by yet another unaccountable autocratic state institution, this one not even mentioned in the 1787 constitution or in any of its amendments.

                                                            [–]thecow84 0 points1 point  (0 children)

                                                            It's to squeeze you.

                                                            [–]mkb152jr 0 points1 point  (0 children)

                                                            Neither was the National Bank, which Alexander Hamilton (a huge proponent of the constitution) was a big champion of.

                                                            It doesn’t have to be in the constitution to exist. The National Reserve was created by a law and signed. It’s existence can be amended by a new law that’s signed.

                                                            [–]GoneFishing36 0 points1 point  (0 children)

                                                            Both are issues. The immediate action is increase to control the rates. Whether you can actually get buy in to try for corporate profit that won't get done overnight. I'm just afraid we keep losing focus on this "policy debt" we incur and next admin goes for the easy, but blunt, solution again.

                                                            [–]ipostnow 0 points1 point  (0 children)

                                                            Time to start stealing

                                                            [–]Mostest_Importantest 0 points1 point  (0 children)

                                                            And make the rich people have to contribute blood, sweat, and tears?

                                                            Someone fetch me my fainting couch.

                                                            Life wasn't meant to be spent in toil like the poors. I am a product ofngood breeding, good upbringing, and as a prince to inherit the estate of my father and forefathers. I MAKE Industry!

                                                            Now watch this drive!

                                                            [–]ya_bewb 0 points1 point  (0 children)

                                                            Didn't the filthy rich make a ton of money in the last (great) recession? It's only us plebs that struggle. There is zero chance of anything happening to the big corporations. They run this country, and everyone knows it.

                                                            [–]PLEASE_PUNCH_MY_FACE -1 points0 points  (0 children)

                                                            Raise interest rates. It needs to be expensive to horde assets.

                                                            [–]Ok-disaster2022 -1 points0 points  (0 children)

                                                            Honestly the Fed chair seems irresponsible and for the interests of the rich over the people of the US. He should be replaced.

                                                            [–]oviporus -1 points0 points  (0 children)

                                                            Stop expanding the money supply so recklessly and we might have a chance at stopping inflation. Robert Reich is a blowhard anyway..

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