Energy Prices Rising, Raising Concerns About Inflation and the Economy

[Frodo]

It is going to be another long winter, but this time for a different reason:

Soaring Energy Prices Raise Concerns About U.S. Inflation, Economy

[Senator-elect Spark]

It doesn't help that we spend trillions of unnecessary dollars on "infrastructure".

[sting in the rafters]

It doesn't help that we spend trillions of unnecessary dollars on "infrastructure".

While further stimulation of aggregate demand will potentially cause further pressure on prices due to wage growth, isn't the energy shortage a global problem? Thus, wouldn't spending on optimizing the efficiency of the energy grid, green agriculture, and renewable sources reduce the risk of future inflationary shocks that result from natural resource shortages by diversifying the national energy supply?

[jaichind]

https://www.reuters.com/world/us/americans-may-not-get-some-christmas-treats-white-house-officials-warn-2021-10-12/

"'There will be things that people can't get,' at Christmas, White House warns"

Worry not.  The White House will appoint a Bottleneck Czar that will fix all these problems. 

[chinsum]

It doesn't help that we spend trillions of unnecessary dollars on "infrastructure".

While further stimulation of aggregate demand will potentially cause further pressure on prices due to wage growth, isn't the energy shortage a global problem? Thus, wouldn't spending on optimizing the efficiency of the energy grid, green agriculture, and renewable sources reduce the risk of future inflationary shocks that result from natural resource shortages by diversifying the national energy supply?

The global energy shortage is pretty inherent to the usual boom/bust cycles with fossil fuels.    Europe is experiencing particularly high prices due to having a summer with lots of overcast days with little wind generation, and thus less renewable power.

[Frodo]

With unemployment (and underemployment) no longer as big an issue as it was, I am glad to hear that the Federal Reserve has started to taper off its bond-buying.  It will soon come time to raise interest rates to help fight inflation.  The economy no longer needs to be propped up, and it is time to shift gears.