Thread

1. bwb · 1789586180 · focus · HN ↗

   Get ready for a fun ride my friends :)

   Fun ride =

   Oil is going up, possibly for a long time, which will have a big inflationary effect on everything. And it appears the USA government has lost the conflict it started and effectively given control over key oil delivery channels to Iran. Not to mention Saudia facing real issues from rebel groups / Yemen (simplification).

   Government debt is high in several key economies, and the bond market is being saturated with AI-related bonds, as well as possibly people finally tired of lending the USA/France/UK money at low rates and demanding higher ones. And with higher interest rates and bonds rolling over it means more and more money going to pay for the debt, rather than core services.

   Wild cards lurking in the bushes... AI, AGI, RSI.

   And yonder you have a nuclear power floundering; its only source of hard currency is being rightfully degraded, and its leadership delusional.

   And the one to watch IMO... Russian wheat export ability: wheat prices are up considerably, and combined with inflation from oil, this is the kind of stuff that creates waves of political change like the Arab Spring.

   1. leptons · 1789586770 · focus · HN ↗

      This comment isn't helpful. Please explain for those of us without a degree in economics.

      1. kadoban · 1789587248 · focus · HN ↗

         Inflation is high, so interest rates need to go up to try to slow that, but the economy isn't doing amazing already, and higher interest rates won't help that.

         Not to mention the US debt is _high_ as hell and bond yields mean that's more expensive.

         And the country is run by a broken fool who has no interest or ability to fix any of that.

         1. rayiner · 1789588137 · focus · HN ↗

            > And the country is run by a broken fool who has no interest or ability to fix any of that.

            Trump will be gone in three years, but you&#x27;ll still have an electorate that wants more free stuff while also getting tax cuts. There is zero appetite for fiscal reform in the U.S. The geometric growth rate of U.S. debt has been consistent since 2010 and will remain so when AOC is President: <a href="https:&#x2F;&#x2F;usafacts.org&#x2F;answers&#x2F;how-much-debt-does-the-us-have&#x2F;country&#x2F;united-states&#x2F;" rel="nofollow">https:&#x2F;&#x2F;usafacts.org&#x2F;answers&#x2F;how-much-debt-does-the-us-have&#x2F;...

            1. nemomarx · 1789589182 · focus · HN ↗

               You really really just need to raise taxes. Just find a way to sell that to the public (focus on the rich or large corporations or whatever outgroup you want basically)

               1. rayiner · 1789597588 · focus · HN ↗

                  Our budget deficit is $2 trillion. To close it, you need to significantly raise taxes on the fattest part of the income curve, which is the top 25%. They have $10 trillion of income. <a href="https:&#x2F;&#x2F;taxfoundation.org&#x2F;data&#x2F;all&#x2F;federal&#x2F;latest-federal-income-tax-data-2025&#x2F;" rel="nofollow">https:&#x2F;&#x2F;taxfoundation.org&#x2F;data&#x2F;all&#x2F;federal&#x2F;latest-federal-in.... An across the board 200 basis point increase would close the deficit. That would raise their taxes to 38% at the low end to 46% at the high end, which is perfectly fine.

                  The problem is that the top 25% isn’t an “out group” in either coalition. You have Facebook PMs who vote blue and guys who own a small plumbing company who vote red both making $1 million+ annually and neither wanting their own taxes to go up. Then there are the guys below them looking up. Over 10% of the country will be in the top 1% of earners at some point in their life. So the guys pulling in a few hundred K as a senior engineer or construction manager don’t want their taxes to go up either.

                  1. cbolton · 1789637957 · focus · HN ↗

                     &gt; Over 10% of the country will be in the top 1% of earners at some point in their life

                     Though most of them only for one year due to temporary revenue, so it&#x27;s not that rational.

                     1. rayiner · 1789650999 · focus · HN ↗

                        At peak career ages, the 75th percentile household income is almost $200k and the 90th percentile is almost $300k. That’s exactly the range you need to tax. Across all ages, households earning between $150k and $800k earn half of all income—$7 trillion.

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