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Evening_Cut4422 t1_iui9i55 wrote

Reply to comment by Congo_King in Will this be the options play that makes me rich? by exclusive_mo

Liquidity crisis happening across the worldimg

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Arguablecoyote t1_iuiagr6 wrote

Isn’t low liquidity how you get inflation under control? And that was the goal of the rate hikes? But now it’s a crisis while inflation is still above 8%? I don’t understand any of this. Seems like people just got addicted to free money and are throwing a hissy fit now that it’s drying up.

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Evening_Cut4422 t1_iuibjb2 wrote

Not really, the whole point of this inflation is supply constraint on oil and food thanks to russia. You can stop demand by lowering liquidity on paper, but it doest work in the real world. You are gonna have to eat and transport goods everyday which is fuel by oil and food, fed hiking mortages to 8%, making everyones 401k -60%, crashing a few central bank does help you get more food and oil it makes the inflation issue goes rampant untill a depression occurs and people have no choice cuz they cant even eat and work.

On the global liquidity problem, china, japan, saudi have 1 - 3% inflation when US raise fed rates to 4% and mortage rates to 8% they have to follow leading up to 9% in mortage rate(which most of their people uses flexi rates) and 5% (business loan rates) which slows down the economy making people jobless and starts a defualt cascade. They are over the point of paying the for the US mistakes and have been offloading their USD and tbills, no one is paying for bidens mistake when their people are suffering

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