He calls for an increase in interest rates, as most central banks are doing, but in tandem with a targetted spending program. He says governments should sell green investment bonds to raise funds and then direct that spending to solve the high energy prices, agriculture prices, supply chain, and housing problems.
This is where we diverge. Higher interest rates make everything we buy more expensive. That is the "definition" of inflation, not a fix for it.
Bonds are not, and cannot be, a funding mechanism for government spending. They are just a currency/reserve drain and require money already created to purchase. If we still had a pegged currency (gold standard) bonds would open up policy space for spending.
However, with a free-floating fiat currency, we are only limited by available resources and Congress can afford anything that it can resource with the dollars it can create without regard for current or previous revenue position. The US dollar is self-funding and Congress needs no revenue (an oxymoron for regular morons when dealing with federal finance) to spend an infinite amount of them. There is, to my knowledge, no "infinity+1" in accounting that makes Congress better able to spend on the public purpose.
That’s not a high-profit environment, so after a few years of that — just maybe — margins might come down and inflationary pressures will ease.
How many Treasury bonds do you own? The same people who are deciding that shareholder equity must be a constant number and only prices and wages are variables are also the primary beneficiaries of higher rates paid to bondholders. It is absurd to think that creating more money to pay higher bond interest is the way to reduce the money supply even if that was a problem. Can you say "TAXATION"?
This, and all of the "living within our means" BS we hear from economists and politicians whenever a benefit for the poor or working-class is proposed does nothing but widen the gap, already bigger than in '29 pre-depression, between the haves and have-nots. We need public spending on our woeful infrastructure, free higher education, single-payer for our outrageously expensive healthcare, and a federally funded livable wage and benefits job guarantee for anyone who wants it.
For everything beyond these points, you nailed it, as usual.
