[beachwood23]

> Further, wage growth not matching production efficiencies or even decelerating is not a monetary policy issue (or anything to do with inflation) but a social policy issue. Specifically, minimum wage not tracking inflation, and in my opinion, a broad-based rejection of unions.

It can be both a monetary policy issue and a social policy issue.

Entities that are close to the money-creation spigot that is the Fed have a decreasing cost of money and debt. Anyone / thing further from the cheap supply of money have seen less benefit. The people working for minimum wage are very far from the cheap supply of money.

Social policy, as you point out, has not kept up with monetary policy. But the problem is initiated from monetary policy.

[arcticbull]

The "money creation spigot" is lending. Anywho who borrows money is at the spigot - that's how fractional reserve lending works, and that's where money comes from. This means anyone with a mortgage, anyone with a credit card, anyone with a post-paid phone plan.

Indexing minimum wage to inflation substantially solves the problem.

Can you quantify the spread you claim exists here? I feel like just pointing to the "cantillon effect" and blaming it for everything without actually quantifying the magnitude of the issue you think exists is harmful to the discourse.

The charter of the central bank is to maintain low predictable inflation and maximize employment. That's the function of monetary policy.

[andriesm]

I wonder if a big part of the allleged theft from the little guy isn't due to dishonest CPI statistics that manipulate officially reported inflation to be lower than the cost of living increases most people experience.

Also perhaps fractional reserve banking does create the issue thatp those who can borrow money and buy assers have an advantage over those at the bottom who strugglle to buy assets and cannot borrow.

I am certainly a fan of modern day capitalism compared to socialist redistribution, but a lot can maybe be fixed with "honest" money of some sort that is not easy to inflate at will. (Algorithmic money perhaps like a carefully designed crypto or some variation of gold backing)

The challenge with honest money, is you cannot really control monetary policy (the free market will set interest rates) , but the benefit is, nobody can debase it too easily.

i. e. no bailing out wallstreet during recessions, but also if you gonna bailout consumers with stimmies they will pay for it later in higher taxes.

[imtringued]

You should worry about the federal tax "spigot" instead. It does not take very many brain cells to understand that taxes are collected everywhere and paid out wherever politicians want leading to geographical inequality.

Interest rates and capital gains kinda act like a tax as well because wealthy people concentrate in a few high profile cities and are not spread out like local bank branches.

Oh and land is a natural monopoly so land owners get their cut as well.