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Cost-volume-profit is an analysis tool managers use to manage a business. The paper David W shared shows how the tools within Neo-Fisherism lowers economic activity. We see this in housing transaction volumes crashing, but not prices. When it comes to everyday expenses, the wage earners trying to cut back there too. As they cut back, prices on the lower end will rise to match the lower activity (selling ten $100 items is the same as five $200 items). This will drive wedge further as asset holders are unaffected. Question then for folks: How is the rising prices affecting your area? Do you hear about and see people cutting back? Also it feels like it the avergae wage earners is a lot more disgruntled than they were at the beginning of the year. Does anyone else agree and/or feel that way? I'd love to hear why

Additional reading if anyone is interested. https://www.columbia.edu/~mu2166/neoFisher/uribe_AEJ_macro_2022.pdf "In this paper, I provide empirical evidence drawn from an empirical and an optimizing model in favor of the hypothesis that a gradual and permanent increase in the nominal interest rate leads to a quick and monotonic adjustment of inflation to a permanently higher level, low real interest rates, and no output loss. Put differently, implementing an increase in the inflation target requires gradually rising rates and causes a rising path of inflation. Taken together, the findings reported in this paper are consistent with the neo-Fisherian prediction that a credible announcement of a gradual return of the nominal interest rate from the vicinity of zero to historically normal levels can achieve a swift reflation of the economy with sustained levels of economic activity."

Neo-Fisherism says, that if the central bank wants inflation to go up, it should increase its nominal interest rate target, rather than decrease it, as conventional central banking wisdom would dictate. If the central bank wants inflation to go down, then it should decrease the nominal interest rate target. https://www.stlouisfed.org/publications/regional-economist/july-2016/neo-fisherism-a-radical-idea-or-the-most-obvious-solution-to-the-low-inflation-problem#fig1

Man you guys were cooking tonight. Some really great ideas for growing the Skool community. Also the ideas for investing in a Neo-Fischer market. Assets catering to the rich.