Technology Is Ruining The Central Banks' Plans
The Central Banks of the world listen to their highly degreed economists. These people are recited what they learned from books put together in the 1970s. This is a problem since we are in a much different world today compared to then.
In this video I discuss the impact of technology and how it is messing up the plans of central banks. The fact they do not understand the impact of technology on their quantitative easing programs is causing them to miss the market. But have no fear, the market will wake them up in the end.
▶️ 3Speak
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I wonder if the FED is really that blind to technology and all of the points you've talked about. I sometimes have the feeling that they're not that dated as we believe them to be. It's an interesting play of events though.
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I dont think they have the understanding what the technological impact is upon their quantitative easing.
Remember, what we see from the Fed is the front people. Powell is now the bulk of the mindset there. They employ hundreds of economists trained in the theoretical.
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lol what is this face?
You look like someone in the service industry that is fucking pissed but then they have to put on the fake happy face for the customers so they can make tips.
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Almost everyone underestimated Bitcoin, Ethereum, and crypto in general, including the bankers. This is a brand new technology that introduces a level of trust humanity has never seen before. It takes a long time for people to wrap their heads around it, and the massive paradigm shift it represents.
It is more the economists who are pushing the mindset that the central bank has.
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Summary:
In this episode, Task talks about how technology is disrupting the plans of central banks, particularly the Federal Reserve. He highlights the significant impact of information technology on the economy, with sectors like semiconductors, software, and storage experiencing exponential growth. Task emphasizes how the rapid deflation of information technology at rates of 30% to 70% annually is throwing a curveball at traditional economic theories and the Federal Reserve's approach to quantitative easing and interest rates. He discusses the acceleration of automation, robotic process automation, and warehouse automation post-COVID, leading to a surge in IT's share of the economy and further deflation. Task underscores the inadequacy of current economic models in accounting for technology's deflationary effects and points out the increasing deflationary pressures as more money is poured into R&D and technological advancements.
Detailed Article:
Task starts by explaining how modern technology is fundamentally changing the landscape for central banks, focusing on the Federal Reserve. He criticizes economists for relying on outdated theories, oblivious to the disruptive forces of technology. He stresses that we are currently in a technological age, evident from the massive investments in R&D, the dominance of technology companies in the market, and the increasing portion of personal budgets dedicated to technology-related expenses.
Task underscores the growing impact of information technology on the economy, with 60% of the US economy currently falling under the sector. He delves into how software, AI, algorithms, and other technological advancements are contributing to rapid deflation within the sector. Task highlights that while the Fed continues with quantitative easing, they fail to grasp the deflationary impact of technology, resulting in misguided policies aimed at raising interest rates.
The discussion then shifts to the post-COVID era, where automation, including RPAs and warehouse automation, has seen a surge. Task emphasizes that this trend is only set to increase, leading to a larger portion of the economy falling under IT's umbrella and facing the brunt of deflationary pressures.
Task then contrasts the present technological advancements with the past, citing examples of how paying bills and conducting business have evolved over the years due to technology. He warns that the rapid pace of technological development today places us on a far more advanced starting point than before, with potential implications for the future.
In conclusion, Task points out that the more money invested in technology and R&D, the higher the deflationary pressure due to technological advancements. He stresses that the changing technological landscape poses a challenge for central banks like the Federal Reserve, undermined by their failure to understand and adapt to these evolving forces correctly.