This is a long time coming, really going back to fed policy since the financial crisis. Interest rates have been kept low while the economy was booming throughout Obama's 2nd term. And deficit spending has been the accepted fiscal policy for both parties for decades. Biden has been a part of this going back to his time as a Senator and deserves blame as does Trump.
That said, Biden's early agenda with the ARP, AJP, AFP, and student debt cancellation promises trillions in spending. While some may be needed for actual infrastructure, a lot of it further expands entitlement programs and the budget and nobody paying attention believes it will be paid for outside of printing money.
It seems Americans are going to get a lesson in economic theory and the current Modern Monetary Theory will be tested by reality. The last couple decades has made people think that free lunches existed. I think we are about to find out.
We'll see if this bout of inflation is indeed transitory. Runaway trains are hard to stop and a lot of inflation is fueled by consumer psychology and expectations.
But he hasn't actually spent most of that money because the GOP is blocking all his agendas.
Biden is absolutely going to spend money and we're going to have inflation. 100% agreed, that was inevitable. There were 2 increases under Obama late in his term, there were 7 under Trump but again he kept complaining and bullied the fed into lowering rates, at one point they lowered the rates at I think 4 consecutive fed meetings while economists were openly saying we should be raising them or keeping them flat because Trump was removing the safety net. you don't lower rates when the economy is doing well you raise them or hold steady. But Trump wanted to win the election and he thought low rates would help. he's also a real estate guy so to him being able to borrow money cheaply is good business so he bullied the fed into lower rates. Then the economy started to slow and we HAD to lower the rates even more, and Trump immediately said see I told you so and then the fed had to start pumping money in to prop up the economy.
So now you have a situation where you're in a pandemic and you can't lower rates there's no safety net. Trump wanted NEGATIVE rates remember.
This has always been inevitable, the fed is going to have to do something with the rates and slow down the pumping money in and then we're going to see markets react and sell off due to inflation fears. This is entirely the result of Trumps' economic policies, Covid made it worse but you can't just have low interest rates and print money eventually it catches up as you said.
The cycle is the same everytime, GOP POTUS leaves office with the economy in trouble, Dem POTUS inherits it, GOP blames him. 4-8 years later the economy is "fixed" and the GOP takes over and takes credit for it, lather, rinse, repeat.
I don't think we're going to see a crash yet but this is a clear concern. Last week they were blasting him for the bad jobs report completely ignoring the prior jobs report which beat by almost as many jobs as last weeks missed by.
The interest stuff is precisely why Biden and the Dems wanted the stimulus and extra unemployment benefits to last through Sept, they wanted to help people get back on their feet and maybe get a cushion before this happened. Now all the GOP states are pulling the extra benefits and their own citizens are going to be forced into taking low paying jobs, and then the GOP will blame it on Biden.
things are not bad yet but they certainly could go bad if we have a few more negative things entered into the mix
