Well, inflation is simply expansion of the money supply; the rising prices we see are really just a symptom of that inflation.
Energy prices have a complicated relationship with the prices of other things, so they aren't really a blanket control mechanism for prices. Industries that are super dependent on energy prices (food, airlines, etc.) will benefit from a reduction in the prices that they need to charge their customers. Other industries might increase their prices, because of the money that is left on the table by the energy dependent industries' lower prices, etc.
The mechanism I am describing is a little bit simpler than that. Creating a dollar shortage, internationally, will help to prop up USD at a time when the currency is under attack, but the mechanism for creating this dollar shortage (rate hikes and quantitative tightening) will, incidentally, hurt our economy. Because our economy is so much more dependent on cheap oil than most other economies are, dumping oil to keep the price depressed will have an inordinate effect on our economy, helping to keep it from falling apart during the rough times caused by the rate hikes and quantitative tightening.
However, I do have a much more black pill theory surrounding this mechanism and the effects that I'm describing above, which I will get around to writing a post on, soon.
Well, inflation is simply expansion of the money supply; the rising prices we see are really just a symptom of that inflation.
Energy prices have a complicated relationship with the prices of other things, so they aren't really a blanket control mechanism for prices. Industries that are super dependent on energy prices (food, airlines, etc.) will benefit from a reduction in the prices that they need to charge their customers. Other industries might increase their prices, because of the money that is left on the table by the energy dependent industries' lower prices, etc.
The mechanism I am describing is a little bit simpler than that. Creating a dollar shortage, internationally, will help to prop up USD at a time when the currency is under attack, but the mechanism for creating this dollar shortage (rate hikes and quantitative tightening) will, incidentally, hurt our economy. Because our economy is so much more dependent on cheap oil than most other economies are, dumping oil to keep the price depressed will have an inordinate effect on our economy, helping to keep it from falling apart during the rough times caused by the rate hikes and quantitative tightening.
However, I do have a much more black pill theory surrounding this mechanism and the effects that I'm describing above, which I will get around to reading a post on, soon.
Well inflation is simply expansion of the money supply, the rising prices we see are really just a symptom of inflation.
Energy prices have a complicated relationship with the prices of other things, so they aren't really a blanket control mechanism for prices. Industries that are super dependent on energy prices (food, airlines, etc.) will benefit from a reduction in the prices that they need to charge their customers. Other industries might increase their prices, because of the money that is left on the table by the energy dependent industries' lower prices, etc.
The mechanism I am describing is a little bit simpler than that. Creating a dollar shortage, internationally, will help to prop up USD at a time when the currency is under attack, but the mechanism for creating this dollar shortage (rate hikes and quantitative tightening) will, incidentally, hurt our economy. Because our economy is so much more dependent on cheap oil than most other economies are, dumping oil to keep the price depressed will have an inordinate effect on our economy, helping to keep it from falling apart during the rough times caused by the rate hikes and quantitative tightening.
However, I do have a much more black pill theory surrounding this mechanism and the effects that I'm describing above, which I will get around to reading a post on, soon.