How Bad Are Things in California?

[Kev]

well, just printing and issuing money would mean you would have more money around without a corresponding increase in productivity. So there is more money chasing the same amount of goods and services, demand increases, supply doesn't, people selling the goods and services tend to jack up their prices, and you get high inflation.

Yeah I kind of understand but why is the productivity down in the first place? I mean what is causing there to be a lack of supply, is it because of a lack of money or a lack of resources like oil and shit?

[CGM]

well, just printing and issuing money would mean you would have more money around without a corresponding increase in productivity. So there is more money chasing the same amount of goods and services, demand increases, supply doesn't, people selling the goods and services tend to jack up their prices, and you get high inflation.

Yeah I kind of understand but why is the productivity down in the first place? I mean what is causing there to be a lack of supply, is it because of a lack of money or a lack of resources like oil and shit?

I don't think the problem is the money supply per se. Companies typically need to borrow money in order to finance new production and create jobs. If credit becomes tight, and companies can't borrow, or if borrowing becomes too expensive, then people start losing their jobs., production sags, etc.

But then you have something new to question. What cause credit to be tight? Where it all starts is not clear, although I'm pretty sure there are some here who think they have the answers. Just get ready to sift through the political rhetoric.

Anyways my little adhoc analysis is somewhat simplistic, but it's not too far from the truth.

A very key part of the picture, and one that is perhaps difficult to predict or control, is how people feel about the economy, how confident they are about the future, etc.

[Trainer Monkey]

We've offshored everything that can be offshored,and the income ratio gap between the haves and have nots has grown to its highest level since the Great Depression.
Notice what happened the last time the gap was that high

[CutMeMick]

To me in short the economy is like this.

Supply & Demand

It's that simple.