I've been attempting to read the current reporting on inflation, energy prices etc and just glazing over. Anyone keenly following this stuff and able to explain what's happening and how serious it is?
Also he gave a great explanation of the circumstances of a bank run, that if the bank has short-term liabilities (deposits that can be withdrawn at a moment's notice) and long-term assets (loans that take months/years to be paid back with interest), then they run the risk of entering a situation wherein they do not have the assets to actually meet the demands of depositors.Also a really helpful four-lecture series by Bernanke, the chairman of the federal reserve before Yellen, who held the office before Powell.
Maybe you're talking of a specific time when that did happen, but as a rule, inflation moves in thd opposite direction to interest rates so Fed raising the rate is supposed to control inflation, not exacerbate it (all other things being equal).This was a helpful video, in terms of explaining debt and credit and how cycles can spontaneously (or artificially) arise. But I still don't understand how the Federal Reserve raising interest rates for commercial banks will somehow exacerbate inflation, maybe by increasing the likelihood that these banks will become indebted and unable to meet obligations, thus warranting more money to be added to the system.
When they say that the Fed is printing money they don't literally mean that is engraving money, they mean they are increasing the money supply by magically buying assets with money that didn't exist before (as you say later on).But I'm also confused about when people complain about the federal reserve printing money. Pretty sure the printing/engraving office is under the department of the treasury, whereas the Fed is a pseudo-private organization chiefly in charge of interest rates, i.e. controlling inflation. I understand in theory how "large scale asset purchases" AKA quantitative easing can add to the monetary system, by the fed issuing credit to financial institutions in exchange for certain assets.