Water weighs about 8 pounds a gallon and gasoline about 7 pounds a gallon.
So pretty much dropping a gas tank, especially a 23 gallon tank, requires some logistical planning. Pretty much you want to drop the tank when it is empty or near empty.
So when the “sender” in the gas tank goes south pretty much if you are a lazy-slacker the job gets put off. Pretty much because I’m a clever guy I used the odometer and recorded the mileage knowing that I could easily go 250 miles on a full tank (23 gallons).
So you got to know I got pretty good at this, and over the course of perhaps 2-3 years I drove without a working fuel gauge, and I only ran out of gas maybe 2 or 3 times over those years. Not really a big deal where I got really stuck, but I want to acknowledge that it did happen.
So pretty much I know from experience from doing a sustained 100 MPH in a raised Jeep Scrambler, a rather unstable vehicle, that was lifted, that I could empty a full tank of high test (23 gallons) in about an hour.
So I read in the Op-Ed of the New York Times, an opinion piece from Paul Krugman, the Economist. Pretty much he compares Putin and Powell because they are men who are at war (Ukrainian or Inflation) and also makes a point that they are also both at the same time have made a drastic shift in policy.
Then he takes credit that both he and Powell both got caught up in the surprise when inflation became a problem.
So with the energy crisis in Europe, and Germany suffering from said energy crisis, the word recession is not used. In my understanding is that if Germany is in a recession, that Europe becomes collateral damage and also goes into recession. Know that the Eurozone economy is as large as the U.S. economy. Know that 4 out of 5 recessions are due to high energy costs.
So imagine you are driving along, you have a working fuel gauge, it points toward “E,” you take notice, but you keep driving along anyways, and when the engine sputters, and you loose speed, somehow you are still surprised that you ran out of gas when it happens.
So am I really exaggerating if I compare my running out of gas to Fed policy and the surprise by someone who has a PhD in Economics? Will everyone be surprise when we learn we are in a recession?
Again Jerome Powell is a lawyer by profession and not a bankster or economist.
So how do the all the MBA’s not see the inevitable? Inflation is a surprise? How can that be?
Do you remember when Powell said inflation can be good and that FED policy would promote higher inflation.
So when Germany gets declared to be in a recession, and then in turn Europe, will everyone be surprised? How many interest rate inversions do we need? Where is the tipping point? And when will people realize that we are in a recession (a time of negative or slow growth)?
So maybe my analogy is not an exaggeration at all.
BTW I find all of this rather fascinating. Very basic economic theory is little understood. I think Jerome Powell with his “some prolonged inflation is good” policy had “entrenched” Wall Street to the extent that the inflation mindset has already been “entrenched” at least in Wall Street. Come-on, how did Paul Krugman get blind-sighted?
Anyways, a lot of dumb-thinking…
Cal
