YouTube has The Hill video Economist, Stephanie Kelton, Explains How Spending MORE Is The Solution To Inflation.
Stephanie Kelton, professor of economics and public policy at Stony Brook University and author of The Deficit Myth, details the economics behind supply shortages sweeping industries across the nation.
I haven’t watched The Hill since Krystal and Saagar left. Putting Ryan Grim on to fill the space was another negative. However, if they are going to have Stephanie Kelton on, I watched. Pretty quickly she mentioned the magic words that I had hoped for “just in time” manufacturing. Over the last 30 or so years the idea of “just in time” has spread around the world. Manufacturers realized that they were spending a lot of money in warehousing the supply of raw materials and other inputs to the manufacturing process. If they could get the inputs delivered “just in time”, they could eliminate the cost of putting the inputs into a warehouses and then taking them out when they were ready to use them. Taking out the buffer zones of warehouses saved money, but it made the system more fragile to any interruptions of the “just in time” deliveries. We are now seeing the results of this added fragility. The pandemic put a big kink in the supply chain.
Nassim Nicholas Taleb talks about making things anti-fragile. However, in the short term it is more expensive to protect yourself from fragility. “Free” market competition makes it harder to choose anti-fragility. Banking regulations used to require banks to carry a certain level of reserves to protect against bank runs. That buffer has been cut to the bare minimum and perhaps below that minimum.