Thread by @RickSmithShow

Matías Vernengo: The jargon is "price rigidity." It's easy for prices to go up but it's hard for prices to come back down. Higher prices are here for a while.
@NakedKeynes

Matías Vernengo: Gas is one of those things people *have* to buy so there's an advantage here for the oil companies. People will still buy gas & will try to save elsewhere.
@NakedKeynes

Matías Vernengo: Sarah Bloom Raskin is talking about things that everyone is talking about now, like central banks.
@NakedKeynes

Matías Vernengo: The implication is that the interest rates will go up; if they go up quickly, there'll be a big effect on the country.
@NakedKeynes

Matías Vernengo: We still have about 2 million fewer jobs now than we did at the beginning of the pandemic. It's fair for Pres. Biden to say we've had a decent recovery from the pandemic. It's a good economy, but for whom? Not working people.
@NakedKeynes

Matías Vernengo: In 1978, the interest rates were raised. Very high interest rates & fiscal restraint. Biden is probably willing to do more expansion on the fiscal front but he'll face a tough fight within his own party--Manchin & Sinema.
@NakedKeynes

Matías Vernengo: Higher interest rates will be on housing market, cooling down the market & having impacts on consumption. The refinancing of houses allows some increase in consumption.
@NakedKeynes

Matías Vernengo: Russia & Ukraine produce a large amount of grain, so expect those prices to go up and up.
@NakedKeynes

Matías Vernengo: Russia is a provider of key commodities for the world. Germany imports huge amts of oil & natural gas from Russia. Biden sent a mission to Venezuela & Saudi Arabia, trying to get OPEC to make up for the closing up of oil fields in Russia.
@NakedKeynes

Matías Vernengo: Once those prices go up, the question is whether workers can bring up their purchasing power. The implication is that more children will go hungry & poverty rates will increase globally.
@NakedKeynes

Matías Vernengo: Fertilizers are also chemical goods, many of which come from Russia. As expected, it'll be the working class who pays.
@NakedKeynes

Matías Vernengo: When I moved to this country 25 years ago, we weren't allowed to mention "socialism." Now it's mentioned everywhere.
@NakedKeynes

Matías Vernengo: A crucial thing that makes the dollar the world currency is because that's what oil prices are based on.
@NakedKeynes