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  • Greece: The One Solution They All Ignore [View article]
    Guardian,

    You state the Keynesian model as people would like to see it but the fact is that never happens. It never boosts economic growth in the long run or short run. Think of it this way, if I take money from you to give to someone else to spend, what is the net economic gain? No one asks you what you were going to do with the money.
    May 14 02:35 PM | 10 Likes Like |Link to Comment
  • Why Wall Street Ignores Real Risk and Why History Will Repeat Itself [View article]
    Everyone is greedy, so it's more than that. I think it is groupthink and the safety of the pack. Nassim Taleb is not seen as someone who should be taken seriously or, they just don't understand what he's saying.
    May 9 01:30 PM | 9 Likes Like |Link to Comment
  • Housing Data: A New 'Bust-Bust' Cycle? [View article]
    Well, to answer your specific question: recovery. You don't solve an over building problem (malinvestment) due to past failed policies by trying to start the whole cycle all over again with the same failed policies. You don't normalize a situation by adding more abnormality to it. I think Bush and Obama use the wrong policies. The fact is that 1 in 4 are underwater in the USA. And banks are overlarded with bad debt, residential and CRE. What these policies do is keep capital flowing into an asset class that consumers have told the market they don't want. Which creates more malinvestment. We are seeing a collapsing money supply and a credit freeze because of too much debt. All these policies will do is start this cycle over again, but I don't really see a boom phase because we haven't corrected the last cycle of malinvestment.
    May 21 08:31 PM | 9 Likes Like |Link to Comment
  • The Economy Is Sliding Into a Stagflationary Spiral [View article]
    While I appreciate your commentary, there is no evidence that the bailouts and flood of new money and credit from the Fed actually saved anything. Yes, they propped up some big institutions but the bogeyman of economic collapse is not based on any fact or theory except the junk research put out by the Fed to justify their actions. Instead of having a recession/depression of a much shorter duration, this one is dragging out, and will continue to drag out, for years. How much more suffering have we had as a result. Just assume for a moment that Citi and BAC went down. Are you saying that no banks were around to step into their shoes? I don't mean to pick on you, but this "conventional wisdom" is what got us into trouble in the first place. The expert in this history is David Stockman who writes for my blog, The Daily Capitalist. He is writing a book on the topic and shreds the arguments you have made. The problem is that we keep doing the same things over and over and now we've reached a point, a cliff if you will, where the jump off is massive inflation. And that will cause more harm than any depression.
    May 18 02:32 PM | 5 Likes Like |Link to Comment
  • The Economy Is Sliding Into a Stagflationary Spiral [View article]
    The Dow didn't hit 1929 level until 1954. Good comment.
    May 17 06:13 PM | 5 Likes Like |Link to Comment
  • Greece: The One Solution They All Ignore [View article]
    Bob,

    Unless there is fundamental change in Greece, I don't see the plan working. I think it is a fantasy to believe Greece will adhere to the EMU requirements. The fact is that it was a mistake to admit Greece and now they seem to be stuck with their decision. The political and economic culture in Greece is out of sync with Western Europe. I guess I would ask, other than excommunicating them from the EMU, how would these conditions be enforced? Would they withdraw the credit extended? Then what? The thing they fear would happen: sovereign default. I think this is called a dilemma.
    May 15 01:28 AM | 5 Likes Like |Link to Comment
  • The Economy Is Sliding Into a Stagflationary Spiral [View article]
    I think I have a different view of the Great Depression. Yours would be the conventional wisdom, kind of Monetarist view. Hoover and FDR caused the depression. Please study and compare the 1920-1921 recession: bigger initial crash, more initial unemployment, etc, yet it was over in 18 months because of Harding-Coolidge hands-off policy. I get my info from Rothbard's America's Great Depression, and Amity Shlaes's The Forgotten Man and several others. Stim never works.
    May 18 02:55 PM | 4 Likes Like |Link to Comment
  • Greece: The One Solution They All Ignore [View article]
    I just don't see that happening in a practical or significant manner.
    May 14 02:36 PM | 4 Likes Like |Link to Comment
  • What’s Really Behind QE2? [View article]
    Yikes! MMT sticks up its ugly head. What a silly article.
    Nov 20 04:38 PM | 3 Likes Like |Link to Comment
  • The Triumph of Crony Capitalism: Part 1 [View article]
    Awww, NHR ... BTW, Diogenes, when you find an "impartial" analysis, let me know.
    Aug 12 11:50 PM | 3 Likes Like |Link to Comment
  • Inflation, Deflation or Hyperinflation? (Part 2) [View article]
    We can't have a discussion on this basis. I urge you to learn more about the topic and then comment. Thanks for reading.
    Jun 28 04:48 PM | 3 Likes Like |Link to Comment
  • Inflation, Deflation or Hyperinflation? (Part 2) [View article]
    Tony:

    I appreciate that you took the time to read my article. I understand you may disagree with Austrian theory economics. You have the wrong idea about what it is. One can't always learn theory from a Wikipedia article. Most of what you say about it is incorrect, but this is not the forum for a treatise on it. I urge you to read the sources, not just someone's summary or opinion of what it is. I would hate to see you go through life so misinformed. If you wish to inform yourself, then please see my blog page on recommended reading: dailycapitalist.com/re.../ It is a rich tradition of economic thought.

    I liked your burned hand example. The Austrians would say you can't use the same methods for analyzing human behavior as you can for physics. This is a branch of philosophy called "epistemology" or the science of how we know what we know. Human behavior isn't subject to the laws of physics as your professors would have had you believe.

    I hope you are able to think beyond what you have been told.
    Jun 28 02:11 AM | 3 Likes Like |Link to Comment
  • Why Deleveraging Is Necessary for an Economic Recovery [View article]
    Sorry, OhReally, but I'm putting you on my ignore list until you have something useful to say.
    May 29 12:32 AM | 3 Likes Like |Link to Comment
  • Why Deleveraging Is Necessary for an Economic Recovery [View article]
    Johnc222,

    "What about the social unrest that would be created from pulling the rug from under an artifically prop up Economy. Could the country survive another huge drop in the American standard of living...?"

    I don't see the outcome being economic collapse. We are already experiencing deflation in those over-leveraged assets, which is mainly residential and commercial real estate. This is continuing and there is no way the government can stop it, god knows they've tried. It is simply too big of a problem for them to fix.

    So I would say that while the deflation being experienced in real estate continues, so far we haven't seen social unrest as people lose homes and investors lose commercial properties. What will happen is that the home ownership rate will revert back to its historic norm (say 66-67%) and commercial investors will eat it just like they did in the early 1990s.

    If you believe that the government is keeping the economy afloat, that is not the case. I pointed out the economic data that reveals a sluggish, if not weak economy despite their efforts. I guess you could say it would have been worse, but I don't think so. All the government has done is suck capital out of private hands and spend it on projects the markets don't want, which is thus, mostly wasteful spending.

    It is a mistake to think that it is the government that is keeping us from poverty's door. It's the free market that does that and the more it interferes, the worse we'll be as history has revealed time and again.

    Good question. Thanks!
    May 28 03:46 PM | 3 Likes Like |Link to Comment
  • Greece: The One Solution They All Ignore [View article]
    I like this concept. Let the locals vote on which sovereign they want. I'll bet they choose Germany over France. Why can't a country just mortgage its sovereignty? Like you say, they temporarily cede a few island. The lender just forecloses on the sovereign and that country takes over jurisdiction until the debt is paid off. Imagine Germany setting up a free trade, low tax, no union zone. Capital would rush in, prosperity would break out, and the tax receipts would pay off the debt in no time at all. Imagine the riots when, after the debt is paid, Athens takes back sovereignty and tries to reimpose their control.
    May 15 02:58 PM | 3 Likes Like |Link to Comment
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