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Machiavelli999

Machiavelli999
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  • Dual Mandate, RIP [View article]
    Money is tight RIGHT NOW. And money is tight in Japan RIGHT NOW.

    You seem to associate low interest rates with loose money and there is your mistake.

    The easiest money in the last 100 years in the United States occurred in the late 70s. Inflation was sky high, but so were interest rates. In fact, the highest interest rates in the last 100 years occurred during the late 70s AND that was the time of the highest inflation rate.

    If you think about that for just a moment, that makes perfect sense. With the expectation that inflation will be high, people would only buy Treasury bonds if they got those huge yields. On the other hand, today in US and Japan, people are buying Treasury bonds at miniscule rates. Why would they do this? Because they expect inflation to be very low for years and years to come. And so even though the nominal rate is low, the real rate is comparable to what you saw in the 70s.
    Apr 26 01:37 PM | 1 Like Like |Link to Comment
  • Dual Mandate, RIP [View article]
    You have no understanding of monetary policy. But don't worry, you are definitely not alone.

    If you would actually read Sumner, you would see that he is not looking to achieve lower rates. That's not the point. He wants to restore NGDP back to its 5% growth rate. We are not trying to get people into low interest mortgages. That's not the point here.

    To truly appreciate how little you understand about monetary policy, consider this quote from the father of monetarism, Milton Friedman:

    " Low interest rates are generally a sign that money has been TIGHT, as in Japan; high interest rates, that money has been EASY.
    . . .
    After the U.S. experience during the Great Depression, and after inflation and rising interest rates in the 1970s and disinflation and falling interest rates in the 1980s, I thought the fallacy of identifying tight money with high interest rates and easy money with low interest rates was dead. Apparently, old fallacies never die."

    No, Milton. They never ever do.
    Apr 26 12:24 PM | 1 Like Like |Link to Comment
  • The DOJ has begun a criminal probe of Wal-Mart (WMT) for allegations of systemic bribery in Mexico, according to sources. The U.S. Foreign Corrupt Practices Act bans companies from bribing foreign officials to win business, and enforcement of such has been stepped up in recent years.  [View news story]
    The laws they went around are stupid anyway. I am sure all the permitting officials demanded these bribes before approving the construction permits. Wal-Mart greased the wheels and improved the economy of Mexico with these actions. And now they are being punished.

    Many times, "corruption" is just another word for getting around ridicilous and stupid laws and/or politicians to get real business done. I feel bad for Wal-Mart.
    Apr 24 01:42 AM | 2 Likes Like |Link to Comment
  • The shale gas boom will contribute $118B to GDP by 2015 and low prices will create another 809,000 jobs, says the Natural Gas Alliance, a coalition of 30 drillers. However, points out Gregory Meyer in the FT, that's not all that much when you consider that GDP is $15T and the number of unemployed is 12.7M.
     [View news story]
    It's impossible to please liberals isn't it? If prices are high, they complain that they are too high. If prices are low, they complain they are too low.

    Low nat gas prices will create jobs, because of potential uses of nat gas in applications that haven't been possible before because of the low cost. (Think natural gas powered cars).
    Apr 15 01:49 PM | 1 Like Like |Link to Comment
  • The shale gas boom will contribute $118B to GDP by 2015 and low prices will create another 809,000 jobs, says the Natural Gas Alliance, a coalition of 30 drillers. However, points out Gregory Meyer in the FT, that's not all that much when you consider that GDP is $15T and the number of unemployed is 12.7M.
     [View news story]
    anonymous,

    At least be honest. Just come out and say to the American people: "We want to increase your heating and energy costs. Why? Well, we think fracking, the technology that has unlocked all these gas supplies and driven prices to such low levels (BTW, how come no complaining that GS and Wall Street are driving nat gas prices lower???) should be banned.

    Why? Well, we don't have any concrete evidence. It's all kind of anecdotal and uses false logic (very similar to "vaccinations cause autism" argument). In reality, the market driving a price for a vital source of energy DOWN shatters our entire framework of how the world works and scares us. So, we need to stop it as soon as possible, before people begin to realize the full potential of this (natural gas powered cars??)."
    Apr 15 01:44 PM | 2 Likes Like |Link to Comment
  • North Korea's much ballyhooed long-range rocket launch ended in apparent failure today, dealing a blow to the prestige of the reclusive and impoverished state that's continually defied international pressure to push ahead with the plan. The Unha-3 rocket broke up and crashed into the South China Sea just moments after it launched.  [View news story]
    @coddy0,

    A cloud has a lightning bolt inside it which can kill you at any moment if it gets lucky. Why do you ever walk outside without some sort of electrostatic shield above you.
    Apr 13 01:52 PM | Likes Like |Link to Comment
  • North Korea's much ballyhooed long-range rocket launch ended in apparent failure today, dealing a blow to the prestige of the reclusive and impoverished state that's continually defied international pressure to push ahead with the plan. The Unha-3 rocket broke up and crashed into the South China Sea just moments after it launched.  [View news story]
    Everyone laughs, but there is something to be taken away from this. The politicans here always try to scare us and want to ensure and protect the military-industrial complex by keeping us afraid and so justifying the high military spending

    But we are fighting against 3rd world countries here. There is no reason to be so constantly afraid.
    Apr 12 08:31 PM | 5 Likes Like |Link to Comment
  • The Reason Why Natural Gas Is So Cheap [View article]
    New coal plants have been made virtually illegal by new EPA rules. If we can't do coal and we can't do natural gas, then rates will skyrocket. Everyone knows this. That's why I think that the Obama administration and no future administration is going to stop fracking. It has been a god send to the politicians who want to ban coal.
    Apr 6 12:42 PM | Likes Like |Link to Comment
  • Initial Jobless Claims: 357K vs. 355K consensus (prior week revised to 363K from 359K). Continuing claims -16K to 3.33M.  [View news story]
    The interesting thing is Warren Harding was one of the most libertarian Presidents we've ever had. Probably the most libertarian in the 20th century.
    Apr 5 01:49 PM | Likes Like |Link to Comment
  • JOBS Act Needed To Fix The Banking Industry [View article]
    Anytime anyone tries to get rid of any regulation, no matter how stupid the regulation maybe, there are people who came out of the woodwork to say your are reducing "protection". Some of those people actually believe in this BS. But many see the removal of the regulation as ending their rent seeking venture.

    The article was great and the main thing to point out was that with the current laws, small businesses are dependent on large banks for funding. The small enterprises are not allowed to seek funding online from small investors. Moon Kil Woong above apparently thinks this is good. The past few years have obviously proven that these big banks and financial institutions are the only ones that can be trusted to securely handle investors' money, right Moon?

    Of course, I am not even sure Moon has actually thought this far ahead. Moon's thinking was more like. "Regulation removed? Bad. The end of my analysis."

    Anyway, I hope this passes. I thought it had already passed Congress and now just waiting for Obama's signature. And I hope that it transforms the finance industry and ends its cartel status.
    Mar 25 07:39 PM | 1 Like Like |Link to Comment
  • Disney (DIS) says it will take a $200M write-down related to the mega-flop John Carter, worse than the $120M-$160M forecast by analysts. The loss will result in Disney's studio division reporting an operating loss of $80M-$120M in the March quarter, compared with a $77M operating profit in the December quarter. Disney hopes The Avengers and Pixar's Brave will give its studio ops a lift later this year.  [View news story]
    I guess the main thing I liked about the movie was the twist in the end. It was just so unique.**Spoiler alert**

    I am not even much of a romantic, but that idea that the one you love is on another planet and you cannot reach them just awed me. I have never experienced such a feeling before. Most movies are so formulaic, I can predict almost everything that will happen in them. This was truly unique.
    Mar 20 01:17 PM | 1 Like Like |Link to Comment
  • Disney (DIS) says it will take a $200M write-down related to the mega-flop John Carter, worse than the $120M-$160M forecast by analysts. The loss will result in Disney's studio division reporting an operating loss of $80M-$120M in the March quarter, compared with a $77M operating profit in the December quarter. Disney hopes The Avengers and Pixar's Brave will give its studio ops a lift later this year.  [View news story]
    Should I be embarassed to admit that I liked it?
    Mar 19 06:49 PM | 1 Like Like |Link to Comment
  • Decrying Goldman Sachs' (GS) "rip your eyeballs out" capitalism following Greg Smith's "shot heard round the world," Joe Nocera writes in the NYT that Lloyd Blankfein should look at the "moral capitalism" of Howard Schultz, who will this week make a speech linking Starbucks'(SBUX) record profits with its larger societal role. "The value of your company is driven by your company’s values," Schultz plans to say.  [View news story]
    What Goldman and the rest of corporate America should learn from Howard Schulz and Starbucks is how to play the PR game to get all of the politicians off your back. Schulz is a master at that.
    Mar 18 04:47 PM | 2 Likes Like |Link to Comment
  • High rents and relatively low supply are feeding a potential bubble in the home rental market. In certain markets rents are up almost as much as home values are down: In Chicago, for example, rents are up just over 9% annually while home values were down just over 10%. Now, with home affordability hitting record highs and investors starting to buy again, investors are starting to worry about a tipping point lurking in the shadows.  [View news story]
    The prices are market controlled, but the supplies are government restricted.
    Mar 12 11:47 PM | Likes Like |Link to Comment
  • High rents and relatively low supply are feeding a potential bubble in the home rental market. In certain markets rents are up almost as much as home values are down: In Chicago, for example, rents are up just over 9% annually while home values were down just over 10%. Now, with home affordability hitting record highs and investors starting to buy again, investors are starting to worry about a tipping point lurking in the shadows.  [View news story]
    People are missing something with the rising rents. We have a structural problem with rents.

    If you haven't seen/read them already, I would highly recommend two recent Ebooks "Gated City" & "The Rent is Too Damn High".

    Both talk about the insane city zoning and anti-development rules which have became so popular with local governments around the country. We are making it harder and harder for developers to develop. No wonder the rents are rising.
    Mar 12 11:31 PM | Likes Like |Link to Comment
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