Thank you for a terrific interview. Ted Oakley, thank you for inviting Lacy Hunt to your program. His presentation and the information he shared is so well thought out and he explains it all with such clarity. I find myself listening to it a second time to pick up on all the details. And also, how uplifting it is too to see two friends have such an intelligent conversation and such good rapport together. Many thanks!
It has been a while since I have seen Dr Lacy Hunt interviewed, they are few and far between. Makes it all so much more valuable to hear him speak. In Australia, wonder what our marginal product of return on govt debt is down here ?
Great Chat with Mr. Hunt, but I’m a little confused. There is only one solution to our Debt Problem…Austerity. Mr. Hunt correctly assumes we can’t do it. Too many people hurting and politicians will never sell it. Which then means the only Real outcome we can expect is at some point we fill forfeit, restructure or whatever word you want use, but we are not paying the total debt back. Yet he and many are advocating to buy Bonds…..the same Bonds which will not be paid back. Is it just me or does thing seems contrary? Thanks for your kind comments.
Fantastic interview. Thank your for sharing your knowledge and multi layer view of what is going on. I am self taught by watching smart guys like yourself for the last 5 years and I have come to the same conclusions albeit in a slightly different way. The main points are key the keysian intervention have propped up markets preventing asset turnover. Where we slightly differ is I believe the velocity of money slowing has also been strongly influenced by Boomer retirement starting in ~2008 paired with the propped up asset prices. This has been exacerbated since that asset price crash as we are back up to 8.5 times earnings for home valuations for millennials. Its a giant von mises crack up boom.
A rather somber ending: “I see no way out” What then does this mean? The demographic portion of economic growth seems to me the most dangerous. One can tighten one’s belt if worst comes to worst, but if there is the reality of diminishing customers to buy one’s product no matter what one attempts to do, e.g. weak solutions like repackaging that product, there is only one conclusion - less product needed, hence long term - less profit. One can raise prices, or shrink the size of the product, (which in effect is the same thing) but those tricky methods cannot ultimately overcome the real problem of having less people in the not so far future. Perhaps Victor Orban (from Hungary) has it right: Reward people who produce children via tax breaks (even elimination of taxes) combined with payouts for those who have multiple children. In some ways his solution is the Anti solution of the One Child Policy that China enacted,which worked for a few decades due to eliminating the real costs in raising children for a 15/20 year period,, but has doomed them in the long run, as the population ages. Perhaps the USA can mitigate over the short term the demographic collapse via immigration, and perhaps that is the Real reason for this Open Borders quasi Policy under Biden. We need Bodies, and we need them Now, even poorly educated bodies like the typical Illegal Alien. But that is not a long term solution. I would’ve liked an Answer from Mr.Hunt besides - “we’re screwed” regarding the future, but perhaps there is none.
Wonderful interview!!! The charts and graphs and research study info is so very helpful. Thank u Yed and Dr. Hunt. About demographics -- the enormous growth in human population over the recent past has caused enormous problems that are and will be even more costly in the future such as climate change, plastic in the oceans, loss of species (the drastic declines in insects due to current ag practices and loss of habitat could be catastrophic.) I fear the economic consequences of those things more than our current mess. More people will only add to that. And, very unfortunately for humanity, fertility rate is inversely correlated w IQ -- that is obvious when one looks at the low IQ of most countries w the highest birth rates. Humans have carelessly squandered so much on our high pop growth that future generations will be paying the costs for that for a much longer time than our current economic problems and the immediate costs of slowing demographics in most developed countries. The demographics for the planet are still exploding. About 2 billion more estimated by 2050. Please consider those costs.
Thanks for your comments Pamela. What measures would you propose to our current situation? I do believe that the problems highlighted by you but not seeing the Govts moving in the right direction. Lack of Trust between countries in each other results in them gathering their own resources, which results in the race between nations, which results in unsustainable production vs growth. If a Govt wants prosperity, They have true intentions but another block of countries will not work with them is a difficult situation.
The world is actually in demographic decline and the correlation between IQ and fertility is more a consequence of the urbanization of a country than it's intelligence.. That some time to study Peter Zeihans work and it will help your perspective
I wonder who you’re trying to convince. How many times do you have yo ho over what we’ve been hearing for years? I think a more important and relevant guest would be John Williams of Shadow Stats.
Why does Lacy say you can’t have runaway inflation for long? How does he think numerous 3rd world countries achieved this? Is our government going to magically be fiscally responsible after what we saw in 2020/21? Can the Fed manage positive real rates (treasuries over 7% 😅)?
Because the Fed operates in a lending only legal structure. Countries that have hyper-inflation have central banks that create money to pay for govt spending vs. lending. Look at Japan over the last 35 years. Where is the inflation?
We are a debt based economy so all money is debt. When the economy falls so does debt and credit which means less dollars chasing goods- deflation.. Most of the worlds debris denominated in Dollars, so when Credit can not expand, it contracts so dollars in the system contract. All these institutions around the world have to fight for less and less dollars to pay debt which strengthens dollars. The whole whole is check kiting credit, getting more to pay off existing debt. The over seas institutions that create loans out of thin air in Dollars is HUGE!!
@@Michael-qy1jz There is no solution in sight. We are consuming more than we are producing. In that way, we can not grow further from a certain point. As per his lecture, we are not practically growing our GDP but only via financial engineering. Our Banks make profits, but Businesses lose money and take more debt. So the cycle is broken so that even two people working full time can not make ends meet. Inflation is a silent tax that is broadly applied to everyone. There is another problem. We have no experience from the past of how to feed 9 billion people. We had wars and diseases that did population resets; of course, they were terrible, but they had some evolutionary mechanism to destroy and then construct a cycle. The other problem that I find is " Concentration of wealth. I am not sure why Govt could not manage it across the world. Too much wealth is in too few hands, which is against the Law of Economics. Why money can not flow back into the system is the problem. Why an only handful of companies are profitable, and why do we have centralization than a distributed system. This is the dark side of Growth. Unsustainable Growth.
Thank you for a terrific interview. Ted Oakley, thank you for inviting Lacy Hunt to your program. His presentation and the information he shared is so well thought out and he explains it all with such clarity. I find myself listening to it a second time to pick up on all the details. And also, how uplifting it is too to see two friends have such an intelligent conversation and such good rapport together. Many thanks!
It has been a while since I have seen Dr Lacy Hunt interviewed, they are few and far between. Makes it all so much more valuable to hear him speak. In Australia, wonder what our marginal product of return on govt debt is down here ?
Just to add it was a pleasure and a privilege to watch this interview. Great content. Thanks
This is the man I want running the Federal Reserve Bank.
This is the man I revere, when it comes to Macro Economics.
Never disappoints 👍
Great Chat with Mr. Hunt, but I’m a little confused. There is only one solution to our Debt Problem…Austerity. Mr. Hunt correctly assumes we can’t do it. Too many people hurting and politicians will never sell it. Which then means the only Real outcome we can expect is at some point we fill forfeit, restructure or whatever word you want use, but we are not paying the total debt back. Yet he and many are advocating to buy Bonds…..the same Bonds which will not be paid back. Is it just me or does thing seems contrary? Thanks for your kind comments.
Great interview, subscribed.
Can't believe this channel doesn't have more subscribers.
Outstanding interview !!
Thank you Dr.Hunt! Outstanding interview.
Thank you for the interview! Like!
Fantastic dude LH is… the Yoda of macro!
Fantastic interview. Thank your for sharing your knowledge and multi layer view of what is going on. I am self taught by watching smart guys like yourself for the last 5 years and I have come to the same conclusions albeit in a slightly different way. The main points are key the keysian intervention have propped up markets preventing asset turnover. Where we slightly differ is I believe the velocity of money slowing has also been strongly influenced by Boomer retirement starting in ~2008 paired with the propped up asset prices. This has been exacerbated since that asset price crash as we are back up to 8.5 times earnings for home valuations for millennials. Its a giant von mises crack up boom.
When Lacey says "I Don't know where the Feds head was" regarding still buying mbs as the housing market set new records he is being polite.
Great guy 👍
FANTASTIC
A rather somber ending: “I see no way out”
What then does this mean?
The demographic portion of economic growth seems to me the most dangerous. One can tighten one’s belt if worst comes to worst, but if there is the reality of diminishing customers to buy one’s product no matter what one attempts to do, e.g. weak solutions like repackaging that product, there is only one conclusion - less product needed, hence long term - less profit.
One can raise prices, or shrink the size of the product, (which in effect is the same thing) but those tricky methods cannot ultimately overcome the real problem of having less people in the not so far future.
Perhaps Victor Orban (from Hungary) has it right: Reward people who produce children via tax breaks (even elimination of taxes) combined with payouts for those who have multiple children. In some ways his solution is the Anti solution of the One Child Policy that China enacted,which worked for a few decades due to eliminating the real costs in raising children for a 15/20 year period,, but has doomed them in the long run, as the population ages.
Perhaps the USA can mitigate over the short term the demographic collapse via immigration, and perhaps that is the Real reason for this Open Borders quasi Policy under Biden. We need Bodies, and we need them Now, even poorly educated bodies like the typical Illegal Alien.
But that is not a long term solution.
I would’ve liked an Answer from Mr.Hunt besides - “we’re screwed” regarding the future, but perhaps there is none.
Still watching Frank G Melbourne Australia 🇦🇺 ❤️
We won’t have runaway inflation because we can’t afford it^^ So true!
Thanks, addressed some questions I had about how inflation could be sustained with so many baby boomers going to fixed incomes.
I would love to know what Lacy is invested in for these challenging times.
long tbills
financial Jesus is in da house 🙌🏻😎
Thorough, point.
Wonderful interview!!! The charts and graphs and research study info is so very helpful. Thank u Yed and Dr. Hunt. About demographics -- the enormous growth in human population over the recent past has caused enormous problems that are and will be even more costly in the future such as climate change, plastic in the oceans, loss of species (the drastic declines in insects due to current ag practices and loss of habitat could be catastrophic.) I fear the economic consequences of those things more than our current mess. More people will only add to that. And, very unfortunately for humanity, fertility rate is inversely correlated w IQ -- that is obvious when one looks at the low IQ of most countries w the highest birth rates. Humans have carelessly squandered so much on our high pop growth that future generations will be paying the costs for that for a much longer time than our current economic problems and the immediate costs of slowing demographics in most developed countries. The demographics for the planet are still exploding. About 2 billion more estimated by 2050. Please consider those costs.
Thanks for your comments Pamela. What measures would you propose to our current situation? I do believe that the problems highlighted by you but not seeing the Govts moving in the right direction. Lack of Trust between countries in each other results in them gathering their own resources, which results in the race between nations, which results in unsustainable production vs growth. If a Govt wants prosperity, They have true intentions but another block of countries will not work with them is a difficult situation.
The world is actually in demographic decline and the correlation between IQ and fertility is more a consequence of the urbanization of a country than it's intelligence.. That some time to study Peter Zeihans work and it will help your perspective
39:49. Indeed, but their solution is to take the short cut and ramp the markets.
Their military budget has huge cuts room plus.
I wonder who you’re trying to convince. How many times do you have yo ho over what we’ve been hearing for years?
I think a more important and relevant guest would be John Williams of Shadow Stats.
Why does Lacy say you can’t have runaway inflation for long? How does he think numerous 3rd world countries achieved this? Is our government going to magically be fiscally responsible after what we saw in 2020/21? Can the Fed manage positive real rates (treasuries over 7% 😅)?
Because the Fed operates in a lending only legal structure. Countries that have hyper-inflation have central banks that create money to pay for govt spending vs. lending. Look at Japan over the last 35 years. Where is the inflation?
@@mikemarshall35 the secret that the inflationary camp doesn't seem to know.👏
The Fed can create and lend quadrillion dollars and it still won't cause hyperinflation.
We are a debt based economy so all money is debt. When the economy falls so does debt and credit which means less dollars chasing goods- deflation..
Most of the worlds debris denominated in Dollars, so when Credit can not expand, it contracts so dollars in the system contract. All these institutions around the world have to fight for less and less dollars to pay debt which strengthens dollars. The whole whole is check kiting credit, getting more to pay off existing debt. The over seas institutions that create loans out of thin air in Dollars is HUGE!!
@@Michael-qy1jz There is no solution in sight. We are consuming more than we are producing. In that way, we can not grow further from a certain point. As per his lecture, we are not practically growing our GDP but only via financial engineering. Our Banks make profits, but Businesses lose money and take more debt. So the cycle is broken so that even two people working full time can not make ends meet. Inflation is a silent tax that is broadly applied to everyone. There is another problem. We have no experience from the past of how to feed 9 billion people. We had wars and diseases that did population resets; of course, they were terrible, but they had some evolutionary mechanism to destroy and then construct a cycle. The other problem that I find is " Concentration of wealth. I am not sure why Govt could not manage it across the world. Too much wealth is in too few hands, which is against the Law of Economics. Why money can not flow back into the system is the problem. Why an only handful of companies are profitable, and why do we have centralization than a distributed system. This is the dark side of Growth. Unsustainable Growth.