Summary of today's FOMC meeting: The labor market remains too strong

[foxyroxy]

@shadowkat They have never indicated that is their goal. They have indicated, ad nauseum, that price stability is one of their congressional MANDATES. Interest rates and their balance sheet are their only real tool to fulfill their mandate.

 

[willywonkadummy]

@foxyroxy They have indicated they want more people not working.

 

[foxyroxy]

@willywonkadummy No they haven't. They have indicated that the job market is strong and inflation is the current issue they are attempting to tackle. They have raised rates late and painfully slow to attempt to avoid disrupting the labor market. That is the opposite of wanting "more people not working".

 

[willywonkadummy]

@foxyroxy Damn, I didn’t know the fed wasn’t paying for pr control on Reddit. This is just factually wrong.

 

[foxyroxy]

@willywonkadummy The facts disagree with you. Directly from the very top of the Fed's summary from yesterday's meeting:

"Recent indicators point to modest growth in spending and production. Job gains have picked up in recent months and are running at a robust pace; the unemployment rate has remained low. Inflation remains elevated."

"The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. In support of these goals, the Committee decided to raise the target range for the federal funds rate to 4-3/4 to 5 percent."

 

[willywonkadummy]

@foxyroxy Maximum employment is what the fed sees as the maximum amount of people who can be employed without causing unwelcome inflation. That means they see to many people working as a cause for inflation.

Based on a 53 year low in unemployment, it points to being above the maximum employment. With their method of taming inflation, that goal you speak of, needs to raise the unemployment.

“We’re very far from our price stability mandate and, in effect, the economy is past most estimates of maximum employment,” taken straight from the horses mouth.

He can claim it’s not his goal all he wants, that’s just lip service. It’s the equivalent of Stewie saying “I don’t want her dead, I just don’t want her alive anymore.” He wants to see the labor market weaken and that’s what he’s aiming to do.

But sure, keep that spin game strong.

 

[foxyroxy]

@willywonkadummy It's their DUAL mandate. Care to contribute what policies within their toolkit you think they should have implemented to control inflation? It's easy to doubt intentions, it's much more difficult the determine any action they could take to control inflation without risking a rise in unemployment. As I stated, they raised rates late and over an entire year in an effort to cause a little impact on employment as possible. The actions they took are a matter of fact, and point to Fed decisions that directly refute the narrative that they want to raise unemployment levels.

 

[willywonkadummy]

@foxyroxy No they raised rates late to keep the printers going strong, the later consequences for inflation be damned. You don’t sit on your hands for a year, let a situation fester to pretend you were looking out for employment. If he had nutted up a year earlier, he would have caused less of an overall impact. Now we’re balls deep and still got a ways to go.

Idk where you think they point to, there’s a years worth of quotes straight up saying they need higher unemployment.

And no, I’m not going to answer a question being asked by someone arguing in bad faith.

 

[foxyroxy]

@willywonkadummy I believe the Fed (it's not one person) should have raised rates earlier. Then, I believe when they did raise rates, they should have raised faster. Both of those actions would have had a greater impact on both inflation and employment. You're arguing both sides, but aren't willing to offer what actions they should have taken to introduce less risk to employment and meet their mandate of price stability. In short, you seem to have reached a conclusion but haven't really found the factual justification for that conclusion.

 

[agenonlin3]

@foxyroxy that's not their goal, if anything they have the opposite goal. it just so happens that their main goal of lowering inflation implies (in their minds) that they need to increase unemployment or otherwise push down wages. can't have the workers making more money at the expense of the wealthy...

 

[claireanneh]

@shadowkat "The poors are making too much money"

 

[roseann344]

@shadowkat A cartel of banks is of course going to be anti labor.

 

[emelcee]

@shadowkat There is a worker shortage. Few people looking for work are currently unable to find it.

 

[roseann344]

@emelcee No, there’s not a worker shortage, there’s an economy over abundance of companies that don’t want to pay for shit.

 

[emelcee]

@roseann344 Although the jobless rate is at a 53-year low, the labor force is still 3 million workers shy of where it was predicted to be based on population growth. If people kept working at pre-pandemic rates, the labor force should have been around 168 million at the end of 2022, but it actually stood at 165 million when the year closed.

https://www.beckershospitalreview.com/workforce/precise-size-of-us-labor-shortage-in-question.html

https://www.reuters.com/breakingviews/american-labor-shortage-is-rose-with-many-thorns-2023-03-07/

 

[arphaxad9]

@emelcee How can the Fed bring in missing immigrants, force people to unretire, or cure long covid through interest rate hikes?

 

[roseann344]

@emelcee Worker productivity has never been higher, so no, I don’t see a worker shortage.

 

[emelcee]

@roseann344 Unpack that logic for me- I'm not following.

 

[danielfromcanada]

@emelcee The meat packing plant needs more 12 year olds to clean the killing floor

 

[foxyroxy]

@emelcee If only there were a way to increase the supply of labor and allow legitimate asylum seekers obtain that asylum.