milkchaser's Comments

The Next Leg of the Crisis: Unavoidable Catastrophe

Tue, 15 Dec 2009 14:41:28 -0500

Where can I read about the problem of long-term decay in TBT?

Bunning to Bernanke: 'You Are the Definition of Moral Hazard'

Thu, 10 Dec 2009 11:52:01 -0500

Ferdinand E. values Bernanke's reputation over Bunning's. The point of the fable "The Emperor's New Clothes" is not that the little boy was smarter than the emperor, just that he believed his own eyes without regard to reputation. Bunning caught Bernanke dead to rights.

Richard Russell: Downturn Will Be 'Vicious'

Thu, 10 Dec 2009 11:45:55 -0500

Background reading regarding FDR's war on business before the second world war: www.fff.org/comment/co...

Its conclusion: "Entry into World War II effectively ended FDR’s antitrust crusade, as war production became the top priority, and big businessmen like Edward R. Stettinius and William Knudsen were recruited to get it done. FDR sent Arnold packing.

If FDR wanted to promote competition, he should have stepped out of the way, eliminating trade restrictions, regulatory restrictions, pricing restrictions, high taxes and other obstacles to enterprise. "

Richard Russell: Downturn Will Be 'Vicious'

Thu, 10 Dec 2009 11:27:15 -0500

It makes no sense to say that war ended the Depression (although these coincided). War is ultimately non-productive. What ended the Depression was that FDR stopped waging war on corporate profits in order to wage war against the Axis powers. Businesses, seeing that they were going to be allowed to keep and reinvest their profits, came out of hiding.

The rhetoric of the current US President displays similar antagonism toward profits.

On Dec 10 10:38 AM Rainmaker986 wrote:

> After the Panic of 1907 came WW1. It took WW2 to really get us out
> of the Great Depression. What do you suppose it will take to clear
> up this mess? War does take peoples mind off of economic collapse
> does it not? After WWI came the "Roaring 20's. Pent up demand from
> years of rationing during WW2 fueled a booming economy. Back to the
> future?

Copenhagen: 'High Water Mark' for the Global Warming Movement?

Thu, 10 Dec 2009 10:26:08 -0500

Claiming to predict future climate based on only 150 years of fairly accurate temperature measurements is like knowing a 50-year-old man for two minutes and claiming to predict what he will have for breakfast tomorrow.

Copenhagen: 'High Water Mark' for the Global Warming Movement?

Thu, 10 Dec 2009 10:21:08 -0500

The real purpose of the global warming scare is not to save the planet; it is to enslave a gullible populace.

Jim Rogers: Lessons from a Legend

Thu, 10 Dec 2009 09:57:12 -0500

If there are any babes in the hot tub, I wouldn't be able to concentrate. Come to think of it, that was a problem for me in college.

Gold: The Glenn Beck Indicator

Mon, 07 Dec 2009 17:35:21 -0500

It's not the gold alarmists who bother me so much, but there's an outfit trying to sell seeds at grossly inflated prices as a kind of survival kit for the impending economic doomsday. "A fool and his money are soon parted."

Why Did Housing Go into a Bubble?

Sun, 06 Dec 2009 11:17:40 -0500

Just curious, j-dub, what was the name of the complex. I lived in StP until 2003.

Energy Impoverishment: Heading Back to Coal?

Thu, 03 Dec 2009 09:48:18 -0500

I would think it was not just energy density that matters, but cost per BTU produced. Nuclear is the densest fuel, but not the cheapest. That honor belongs to coal.

Why Economists Messed Up

Tue, 08 Sep 2009 12:00:54 -0400

"We're all Keynesians now." Where have I heard that before. Just after Nixon took US off the gold standard.

Laissez faire has not been tried since the 1920s. Not everybody agrees that Keynesian approach is best.
www.telegraph.co.uk/fi...

I doubt Lord Keynes would recommend borrowing so much when you're already so far in debt. He recommended gov't spending from a low baseline. That's not what we have had in a long time.

The Five Most Effective Bailouts

Tue, 08 Sep 2009 11:01:51 -0400

> Take the government out of the housing market, in other words,
> and there is no market.

There was no market before FNM/FRE gobbled up market share? There are no banks willing to lend money without a gov't guarantee? Did these GSEs not fail to weed out bad borrowers and put us on the hook for bad loans? Did they not prosper under corrupt management because they had political patrons in Congress?

Government distorts markets.

Healthcare Reform Costs Are Always Underestimated

Mon, 31 Aug 2009 12:14:42 -0400

One could argue that the problem is not optimism that costs will be contained, but lack of optimism and foresight about how new and more expensive medical technologies will be adopted and become the standard of care (e.g. replacement of knees, hip joints, eye lenses; arterial stents; blood pressure medicine, etc). The alternative is to let grandma and grandpa die or live in pain, which we choose through our representatives not to do.

Other significant costs contribute, of course. The cost of litigation and defensive medicine come to mind. Wise legislators could foresee this, but who ever said we have wise legislators?

To JCC: The FDA and medical regulation in general, while contributing to the cost, also contribute mightily to the safety of American medicine. On balance, they do more good than harm.

What's Plausible for the Fiscal Outlook?

Mon, 31 Aug 2009 10:53:26 -0400

The deficit in the first year of Obama is greater than all 8 years of Bush administration (during which the Democrats had a Senate majority half the time and a House majority 25% of the time).

But we are to believe that Bush was the sole font of fiscal irresponsibility? Was Bush fiscally irresponsible? Sure. He seemed to have lost his veto pen. But the Obama's $800 billion stimulus package did not deem a mention? Was not that irresponsible, too?

I believe it was Cheney who said "deficits don't matter". Friedman made a related argument along the lines that it is better to have a large deficit with lower spending than higher spending with no budget deficit. The problem is that Congress uses the capacity to borrow as an excuse to overspend.

As Coolidge said, taxing people for spending we do not absolutely need "is nothing more than legalized larceny". Better not to spend, but for necessary spending, why tax and inhibit productivity when you can borrow at a reasonable rate? It is irresponsible not to borrow a reasonable amount.

Unfortunately, there is nothing reasonable about fiscal policy in our lifetimes.

Celebrating the 'Recovery': I'm Disgusted

Tue, 25 Aug 2009 14:11:04 -0400

We could remedy that situation in 2010 and 2012.

On Aug 25 09:41 AM Moto wrote:

> Congress is us. The administration is us.

Celebrating the 'Recovery': I'm Disgusted

Tue, 25 Aug 2009 13:05:42 -0400

Barney Frank was at the vanguard defending Fannie and Freddie against most of the reforms the Bush administration attempted to impose on them (e.g. an oversight regulator that uncovered its fraudulent bookkeeping). Thank goodness they were able to put at least some oversight in place, no thanks to Frank.
www.washingtonpost.com...

Perhaps GSEs were not the cause of the housing bubble, certainly were not the sole cause, but let us not rewrite history to put the blame on Bush administration and away from the opponents of reform (who are, ironically, now in charge). Bush's record is summarized here:
gatewaypundit.blogspot...

On Aug 25 10:28 AM diogeron wrote:

> I find it interesting that the "GSEs" are often cited as the core
> of the problem. Since Fannie was created in the 1930s (Freddie in
> 1970), it appears that the CONCEPT of a GSE to create a secondary
> mortgage market wasn't necessarily flawed. In fact, they worked quite
> well until their underwriting standards were lowered with the full
> support of the mortgage bankers, realtors, President Bush and the
> majority of members of Congress (yes, BEFORE Barney Frank took control
> of his committee in February of 2007). There is plenty of blame to
> go around, but people should stop implying that the creation of the
> GSEs somehow caused this meltdown.

Celebrating the 'Recovery': I'm Disgusted

Tue, 25 Aug 2009 12:48:52 -0400

Ferdinand E. Banks: I will be surprised if the "macro-financial medicine works", but pleasantly surprised. In the meantime, I am not ready to drink the Kool-Aid. This "medicine" has been tried before and when has it worked? Government jobs take money from job creating businesses or run up permanent debt the interest on which requires real cash that is also sucked from job creating businesses.

I regret that "the health thing" puts you to sleep, but I suppose one should not underestimate the bliss that can result from sticking one's head in the sand.

On Aug 25 08:57 AM Ferdinand E. Banks wrote:

> Hmm. Seems to me that with all the bad news people expect, we have
> only one choice: reelect Obama, and after him make sure that Hilary
> gets her eight.
>
> I wonder what would have happened at Bastogne and the Rhine crossing
> if American soldiers had the kind of pessimism shown in some of the
> comments published on this site. Yes, the so-called energy bill is
> pretty close to bonkers, and I tune out when I hear about the health
> 'thing', but dont be surprised if the macro-financial medicine works,
> and sooner rather than later.

Celebrating the 'Recovery': I'm Disgusted

Tue, 25 Aug 2009 12:28:00 -0400

It's not the number of people owning houses and stocks, but the price paid for them. Perhaps the American people cannot support 60% home ownership, but there is little reason for the lowliest of investors not to own stocks (or mutual funds) as long as they priced right. If you can't afford a mortgage payment, you can't own a house, but you can work at McDonald's and buy its stock.

On Aug 24 02:06 PM John Lounsbury wrote:

> In the history of bubbles and financial dilusions, the cycle has
> never ended until the object of affection is treated with revulsion.
> When home ownership drops well below the historical average in the
> low 60% area, that will be the equivalent of revulsion and a centennial
> bottom bottom will be in. When less than 20% to 30% of Americans
> own stocks, that will be the equivalent of revulsion.
>
> Anything less than drastic devastation of what would be considered
> "normal" will just constitute an extension of the bubble, be it houses
> or stocks. There is no reason why these bubbles can not extend for
> a long time, with only partial deflations from time to time. But
> if you want 60 years like the last 60 years, the bubbles have to
> go flat and start over. Otherwise the two markets (houses and stocks)
> will have significantly lower returns going forward than we have
> become used to.

Forget 'Cash for Clunkers': Try 'Dough for Dumps'

Sun, 23 Aug 2009 09:02:25 -0400

Perhaps they could send ACORN and SEIU out to break a million windows. Think of all the jobs that would create!!

en.wikipedia.org/wiki/...

Flickr vs. Free Speech. Where Is Yahoo's Courage to Do the Right Thing?

Sat, 22 Aug 2009 10:08:52 -0400

The old adage is, "Don't pick a fight with someone who buys ink by the barrel." Nowadays, the powerful people are using a different medium, but it is theirs to control. It is important to publicize Flickr's obvious political bias. One can plead with them for fairness. Good luck.

I agree with Graham that Yahoo is pro-Obama. One can tell from the news sources they pick for their headlines and from the headlines themselves. But bias such as this is old as the hills. One comes to expect censorship from supporters of a strong or socialist state.

achates makes a good point that Yahoo's default action is probably to act on every DMCA complaint and mop up later. So does that mean that the censorship is coming from Time magazine, who protects their interests when they coincide with Obama's/Democrats, but sacrifices them when it hurts Bush/Republicans? To believe that, one would have to believe that Time is left-biased. Not hard to believe, actually.

Rational Market Theory and Black Swans in Healthcare Reform

Tue, 18 Aug 2009 19:16:30 -0400

I take the author's point that those who pay cash for health care are at an unfair disadvantage, as are those who cannot afford health care insurance, but are not poor enough to qualify for Medicaid. I feel for those whose policies were rescinded when they most needed it, or who otherwise lost coverage and cannot now regain it due to a pre-existing condition.

But where is the evidence that a gov't program would best solve this? Why the utlimatum that if all of these problems are not immediately solved, we must accede to a plan designed and run by people with a poor track record with such things. In the light of incompletely funded gov't programs such as Social Security, Medicare and Medicaid, it seems irrational to expand gov't responsibility even further.

When we feel compassion for those in need, why do some people think that there ought to be a governmental fix? What I want to ask these people is just how much they contributed to The Shriners last year? Do they leave their change for the Ronald McDonald house or pocket it? How many dimes did they send to the March of Dimes?

As we know from the aftermath of 9/11, Katrina and the 2004 tsunami, when the need is there, Americans are very generous.

Rational Market Theory and Black Swans in Healthcare Reform

Tue, 18 Aug 2009 15:14:42 -0400

It is not clear to me how we are being used by allying ourselves with FreedomWorks to oppose Obamacare. FreedomWorks did not charter the bus we are taking this Saturday to Orlando, and each of the riders will pay his way ($17 each).

It is not clear to me that AT&T and Verizon have a stake in the health care fight, nor is it clear to me that they would oppose it. They ally with FreedomWorks over a different issue (net neutrality) which is irrelevant.

Non-profit groups must raise money. AARP gets a lot of money via insurance sales, as did FreedomWorks at one time to a far lesser extent. The money FreedomWorks gained from such insurance sales (for HSA accounts, as a matter of fact) averaged $120K out of an annual $7 million budget. Every little bit helps, but FreedomWorks is largely funded by individual contributions, something that the Wikipedia article failed to mention.

The typical Obamacare protester does not know or care who is helping us organize. They are drawn by the issue.

On Aug 18 10:40 AM Bob 123 wrote:

> I believe you that you are not being paid. You are being used.
Do
> you really know the "FreedomWorks" group and who controls it?
Self-funded
> my ass. You are a tool being fooled into working against your own
> interest. For nothing.
>
> From Wikipedia:
> FreedomWorks has received funding from Verizon and SBC (now AT&T).
> [6]Other FreedomWorks funders have included MetLife, Philip Morris
> and foundations controlled by the archconservative Scaife family,
> according to tax filings and other records. [7] It also receives
> funding through the sale of insurance policies through which policyholders
> automatically become FreedomWorks' members. [8] FreedomWorks is closely
> tied to its founder, corporate lobbyist and former Republican Congressman
> Dick Armey, whose former lobbying firm DLA Piper that he resigned
> in August 2009, represents Bristol Myers Squibb, among other pharmaceutical
> companies.

Rational Market Theory and Black Swans in Healthcare Reform

Tue, 18 Aug 2009 14:29:19 -0400

I think we are in agreement about making it illegal to rescind a policy -- after a certain standstill or probationary period during which time the accuracy of the application is reviewed. This, of course, does not require the creation of a gov't insurer.

On Aug 18 10:17 AM YoYoMama wrote:

> The "standstill" period already exists. It's called a probationary
> period, and it lasts about 3 months after the policy is in place.
>
>
> The problem is not that the insurance companies are not aware of
> pre-existing conditions. It's that it is perfectly legal to be arbitrary
> and even invent reasons for the insurance company to rescind a policy.
> It is well known that many insurers will instigate investigations
> only AFTER a an illness or accident.
>
> The only way to fix the problem is to make rescinding policies illegal.
> Period.
>

Rational Market Theory and Black Swans in Healthcare Reform

Tue, 18 Aug 2009 10:02:32 -0400

"The healthcare opponent rabble rousers already have sugar daddies."

I have yet to be paid to attend a rally. No one is subsidizing my efforts, nor any of my co-protesters. This statement is inaccurate.

It is also condescending, suggesting that we are children and that some richer person is our "daddy". This relationship almost certainly exists amongst those on the left whose organizations are sponsored by George Soros. I do not know this to be true of any of the groups who help to organize our protests against Obamacare, which are self-funded (e.g. FreedomWorks).

Condescension is not likely to persuade.

That said, I agree that we would do well to protect the cash market from paying significantly higher prices than health care insurers. That is preferable to a gov't controlled system. However, I do not agree that the disparity of prices is what dooms HSAs. My experience with this is that the health insurers who provide the high-deductible policies for HSAs also drive down the cash price paid by their insured. Since this is one of the ways such insurers compete, it is important to preserve this market aspect. If people choose to self-insure and not take advantage of HSAs, this is their own folly.

Rational Market Theory and Black Swans in Healthcare Reform

Mon, 17 Aug 2009 17:23:22 -0400

"While the opposition protesters appear far less sincere than the civil rights and antiwar movements of the past, I have never seen a President so dedicated to accomplishing his goals as Obama. This President is the most aggressive that I’ve seen in my lifetime. That is what really scares the opposition."

I don't find myself scared of Obama so much as disheartened.

I assure you, as one who has taken to the streets (and town hall meetings) to protest Obamacare, I am sincere. Anti-war and civil rights protesters may have had more on the line or have dealt with a more serious issue than opposing gov't takeover of health care, however, our opposition is not without its own moral urgency and seriousness. I do not care to bequeath to my daughters worse health care than we enjoy today. I sincerely believe Obamacare would drastically worsen health care. I don't really think you are in a position to judge our sincerity, are you?

As for Obama's dedication and aggressiveness, this can be viewed a number of ways. Sympathetically, one can admire his fortitude (if not his foresight). Antagonistically, one regrets his disdain for those who disagree with him and that he has broken the promise to transcend partisanship. I cannot think of a President, of either political party, who has gotten such sympathetic treatment.

But some are suggesting that his talent lies more in getting himself elected than in governing effectively. Part of governing effectively is getting good legislation passed on a somewhat bi-partisan basis. Part of Reagan's legacy was getting major legislation passed by a Democratic Congressional majority (e.g. tax rate cuts, tax reform, Social Security reform, 8 Federal budgets).

Rational Market Theory and Black Swans in Healthcare Reform

Mon, 17 Aug 2009 17:04:08 -0400

> As you say, the opposition needs to provide credible alternatives.

There are various proposals out there to solve the big problems with health insurance -- proposals that do not rely on a vast gov't bureaucracy, nor a single-payer solution. Below are two examples:

How to deal with pre-existing conditions:
online.wsj.com/article...
Today if one loses one's employer sponsored plan, one can become uninsurable. The crux of the proposed solution is that consumer gets to buy the right to purchase health care in the future, as is common for term life insurance today.

Rescission:
Problem described here:
tauntermedia.com/2009/.../
Proposed solution found in comments:

Rescission could easily be stopped by imposing an affirmative obligation on the insurance company to verify its information. So there would be a standstill period (30-60 days) from inception of a policy during which time each side could review and verify health information and break the policy if it didn’t work. Beyond the standstill, the carrier would be on the hook. Once admitted to a pool (eg women born in 1960 living in Boston), individual rates could not change – change one rate, change the entire pool.

Rational Market Theory and Black Swans in Healthcare Reform

Mon, 17 Aug 2009 16:18:55 -0400

"uninsurable patients, are left to go bankrupt or die."

Most likely, to go bankrupt and die (sad to say).

Obama Abandons Public Healthcare Option

Mon, 17 Aug 2009 15:43:09 -0400

"They may well ask why with absolute control of the votes the Congress and administration don’t force the issue. It’s a valid question and one that the leaders of the party will have a hard time answering."

Perhaps because some of the Democrats in Congress are also democrats (i.e. they listen to the voters).

It is amusing to hear Obama chide the critics for being “so fixated on this that they forget everything else”. When one poops in the punch bowl, one should expect a bit of "fixation" over poop-free punch. If the public option was "not essential", then why did he fight for it all this time? Why risk the ire of millions of Americans who oppose it?

This is spin. Obama wants us to believe that he was not strongly pushing a policy that came to be viewed as controversial and, by many, wrong-headed. Now he attempts to disclaim parentage. Good luck with that in light of the youtube record.

Double Your Profits When Treasuries Tumble

Mon, 10 Aug 2009 19:17:21 -0400

What makes FXA better (besides the dividend)?

On Aug 07 07:20 AM prairiedog555 wrote:

> When I look at charts, certainly not an expert, it would seem that
> a better foil to the dollar/us tres would be FXA, plus it pays a
> dividend.

No Future for Vonage

Mon, 10 Aug 2009 09:38:54 -0400

MagicJack did not work for me and I spent 3 aggravating hours "chatting" with first level and then second level support only to have them tell me it cannot co-exist with a Vonage line (they could not say why, though). I am not going to give up a working phone line while evaluating a new service (that initially refused to install). Also, their support (like Vonage in the early days) is less than stellar.

Also, notwithstanding the cost of running the PC 24/7, something geeks like me do anyway, what does one use for a phone during a PC failure while one is rebuilding one's PC and re-installing all apps?

MagicJack is not ready for prime time. Great if it works, but not ready to compete with Vonage.