What we’re reading (1/13)
“Four Reasons To Keep Worrying About Inflation” (Jason Furman, Wall Street Journal). “Those who imagine that inflation will be lower argue that the huge burst of fiscal policy is behind us, supply chains will unsnarl, consumers will shift from buying goods to services, workers will return, and prices for commodities like oil will continue to fall. Some of their arguments are overstated, while others are likely wrong. And if we focus only on reasons that inflation should be lower in 2022, we risk ignoring four countervailing forces that will push toward higher inflation this year.”
“Soaring Used Car Prices Are Pushing Inflation Higher, And There’s Not Much The U.S. Can Do About It” (CNBC). “In the past 20 years used cars’ contribution to inflation averaged zero. It’s now more than 1% on a year-over-year basis, according to data from the U.S. Bureau of Labor Statistics.”
“China's Bitcoin Crackdown Is Good For America” (Reason). “The Chinese bitcoin mining ban was great for bitcoin and the United States. The network withstood a fifty percent hashrate shock with little disruption. Mining infrastructure quickly recalibrated and relocated to other more welcoming locations. Now that a similar dynamic is occurring in Kazakhstan, seasoned bitcoin users don't need to fear that the network will be disrupted (even though weak hands may see this as a reason to sell). In terms of uptime, bitcoin keeps on delivering. The great mining migration of 2021 is a fantastic opportunity for the United States.”
“Libor, Long The Most Important Number In Finance, Dies At 52” (New York Times). “Known as Libor, the interest-rate benchmark once underpinned more than $300 trillion in financial contracts but was undone after a yearslong market-rigging scandal came to light in 2008. It turned out that bankers had been coordinating with one another to manipulate the rate…by skewing the number higher or lower for their banks’ gain.”
“Private Equity Firm TPG Hits $10bn Valuation On First Day Of Trading” (Financial Times). “TPG is the largest company to go public in the US so far this year, and its successful listing comes as the wider IPO market grapples with poor performance and rising volatility…In going public, TPG is preparing to dramatically expand its platform, which has $109bn in assets, by launching new funds and investment products and striking acquisitions. TPG raised $1bn in the IPO.”
