654 Advisors, LLC's Comments RSS Syndication from SeekingAlpha.com http://seekingalpha.com/user/420605/comments http://seekingalpha.com/article/1383811/comments?source=feed#comment-18334721 18334721 Wed, 01 May 2013 18:02:50 -0400 http://seekingalpha.com/article/1230241/comments?source=feed#comment-16392631 16392631
If you're concerned about the Fed's need to manage its balance sheet, look up 'interest-rate corridor'. It already has IOER in place. The balance sheet's size becomes irrelevant under that approach.

Re asset prices, I think fiscal policy is the more important lever, and it is now tightening noticeably, offset by improving employment, private sector credit, housing, etc. The former (USG running deficits) is not as constrained as most politicians and economists think, while the latter (private-sector credit growth) is more constrained than they seem to think. But the party can last for awhile. ]]> Sun, 17 Mar 2013 08:17:32 -0400
If you're concerned about the Fed's need to manage its balance sheet, look up 'interest-rate corridor'. It already has IOER in place. The balance sheet's size becomes irrelevant under that approach.

Re asset prices, I think fiscal policy is the more important lever, and it is now tightening noticeably, offset by improving employment, private sector credit, housing, etc. The former (USG running deficits) is not as constrained as most politicians and economists think, while the latter (private-sector credit growth) is more constrained than they seem to think. But the party can last for awhile. ]]> http://seekingalpha.com/article/1230241/comments?source=feed#comment-16392541 16392541
If we look at wholesale price indices, the rate of increase tended to be insufficient (i.e., deflationary) at times, especially during the classical period of 1873-1896; which makes sense, given that the world gold bloc expanded dramatically, but at the preexisting nominal parity between gold and GBP. (Any country that didn't lower its exchange rate in advance was asking for trouble.) That 30-year deflation, known as the Long Depression, was ended abruptly, along with the U.S. bimetallist movement that culminated in WJ Bryan's Cross of Gold speech, by massive gold discoveries in South Africa, coupled with new production technologies.

You can see the movement of wholesale prices in Jastram's Golden Constant, available here (see charts in between pp 37-38): http://bit.ly/131aMKz]]> Sun, 17 Mar 2013 08:07:27 -0400
If we look at wholesale price indices, the rate of increase tended to be insufficient (i.e., deflationary) at times, especially during the classical period of 1873-1896; which makes sense, given that the world gold bloc expanded dramatically, but at the preexisting nominal parity between gold and GBP. (Any country that didn't lower its exchange rate in advance was asking for trouble.) That 30-year deflation, known as the Long Depression, was ended abruptly, along with the U.S. bimetallist movement that culminated in WJ Bryan's Cross of Gold speech, by massive gold discoveries in South Africa, coupled with new production technologies.

You can see the movement of wholesale prices in Jastram's Golden Constant, available here (see charts in between pp 37-38): http://bit.ly/131aMKz]]> http://seekingalpha.com/article/1230241/comments?source=feed#comment-16392141 16392141
OK, we're getting somewhere, ignoring the jackassedness of your "religious" assertion. A couple of follow ups:

Were *all* additions to the stock of monetary gold inflationary during the classical gold standard or not? If not, what was the optimal rate of growth of the existing stock?

And if govt deficits and non-normal Fed operations are the analogue today to 19th century gold-stock additions, should the USG be balancing or running deficits or surpluses of USD liabilities?]]> Sun, 17 Mar 2013 07:39:09 -0400
OK, we're getting somewhere, ignoring the jackassedness of your "religious" assertion. A couple of follow ups:

Were *all* additions to the stock of monetary gold inflationary during the classical gold standard or not? If not, what was the optimal rate of growth of the existing stock?

And if govt deficits and non-normal Fed operations are the analogue today to 19th century gold-stock additions, should the USG be balancing or running deficits or surpluses of USD liabilities?]]> http://seekingalpha.com/article/1230241/comments?source=feed#comment-15922351 15922351
The Clinton years were an utter nightmare for fiscal policy. Those "surpluses," by definition, meant less savings and more leverage in the private sector and for state and local govts. And all meaningful periods of budget balance or surplus in the U.S. have been followed by recession or depression. (Sample size may be too small for statistical significance, but the observation is probably not a coincidence.) ]]> Wed, 06 Mar 2013 11:48:51 -0500
The Clinton years were an utter nightmare for fiscal policy. Those "surpluses," by definition, meant less savings and more leverage in the private sector and for state and local govts. And all meaningful periods of budget balance or surplus in the U.S. have been followed by recession or depression. (Sample size may be too small for statistical significance, but the observation is probably not a coincidence.) ]]> http://seekingalpha.com/article/1230241/comments?source=feed#comment-15921821 15921821
If you believe this, then to be logically consistent, you must also believe that mining (adding to the stock of precious metals) under a precious metals standard also led to impoverishment. Do you?]]> Wed, 06 Mar 2013 11:39:45 -0500
If you believe this, then to be logically consistent, you must also believe that mining (adding to the stock of precious metals) under a precious metals standard also led to impoverishment. Do you?]]> http://seekingalpha.com/article/1230241/comments?source=feed#comment-15921251 15921251
Far from it. Why don't you just wave the white flag already? The man is dancing circles around you. ]]> Wed, 06 Mar 2013 11:30:01 -0500
Far from it. Why don't you just wave the white flag already? The man is dancing circles around you. ]]> http://seekingalpha.com/article/1230241/comments?source=feed#comment-15630811 15630811
Huh?!?!?

MMT is just one branch of post-Keynesianism. Other schools may be more advanced in their theoretical development. Bottom line in my view is that unless you know how (and why) monetary systems have worked (and not worked) over history, whether precious metal/fiat, fixed/floating, convertible/inconverti... etc, it's hard to make solidly grounded assessments of the roles and implications of sovereign govt deficits and debt. Just my two cents.

@Cynic, I agree MMT could be 'risky' in practice as in raising inflation risk, but most of its proponents are fully aware of that. What politicians would do with it remains to be seen (and their embracing it is very low probability), but most people don't vote for inflation, imo. Personally I'd like to see less risk of chronic underemployment and underinvestment and less emphasis on non-govt credit creation to spur nominal growth, which is what our current theoretical and policy frameworks tend to get us. But that's just me.]]> Thu, 28 Feb 2013 10:21:50 -0500
Huh?!?!?

MMT is just one branch of post-Keynesianism. Other schools may be more advanced in their theoretical development. Bottom line in my view is that unless you know how (and why) monetary systems have worked (and not worked) over history, whether precious metal/fiat, fixed/floating, convertible/inconverti... etc, it's hard to make solidly grounded assessments of the roles and implications of sovereign govt deficits and debt. Just my two cents.

@Cynic, I agree MMT could be 'risky' in practice as in raising inflation risk, but most of its proponents are fully aware of that. What politicians would do with it remains to be seen (and their embracing it is very low probability), but most people don't vote for inflation, imo. Personally I'd like to see less risk of chronic underemployment and underinvestment and less emphasis on non-govt credit creation to spur nominal growth, which is what our current theoretical and policy frameworks tend to get us. But that's just me.]]> http://seekingalpha.com/article/1230241/comments?source=feed#comment-15605881 15605881
The problem with the diagram is that it doesn't touch on the source(s) of Private Savers' "savings." Until you close that loop, you're going to misunderstand the role of govt deficits and debt in our current system and needlessly pull your hair out. Suggest you Google "7DIF". (Sorry, pasting the link isn't working.)]]> Wed, 27 Feb 2013 19:07:04 -0500
The problem with the diagram is that it doesn't touch on the source(s) of Private Savers' "savings." Until you close that loop, you're going to misunderstand the role of govt deficits and debt in our current system and needlessly pull your hair out. Suggest you Google "7DIF". (Sorry, pasting the link isn't working.)]]> http://seekingalpha.com/article/788071/comments?source=feed#comment-12145771 12145771 ...
6. Huge budget deficit.
If we continue to spend like no tomorrow and we cannot raise enough taxes, we cannot balance the budget..."

===

You might want to rethink that one before running to the publisher, e.g.:

How many times in its history has the USG run balanced budgets or surpluses? How many of those were followed by recession or depression?

Given that the USG is the monopoly supplier of net USD financial assets, budget deficits are analogous to gold mine output under a gold standard. What would have happened under a gold standard if gold mines had run 'balanced' or 'surplus budgets' of gold? ]]> Sat, 01 Dec 2012 10:42:45 -0500 ...
6. Huge budget deficit.
If we continue to spend like no tomorrow and we cannot raise enough taxes, we cannot balance the budget..."

===

You might want to rethink that one before running to the publisher, e.g.:

How many times in its history has the USG run balanced budgets or surpluses? How many of those were followed by recession or depression?

Given that the USG is the monopoly supplier of net USD financial assets, budget deficits are analogous to gold mine output under a gold standard. What would have happened under a gold standard if gold mines had run 'balanced' or 'surplus budgets' of gold? ]]> http://seekingalpha.com/article/1009761/comments?source=feed#comment-11645371 11645371
Which means if this were the 19th century, you would argue for ending or severely curtailing gold mining (which would have made the Long Depression of 1873-1896 even worse than it was, and probably elevated WJ Bryan to the presidency...or worse).

When a sovereign issuer is the monopoly supplier of net financial assets, "fiscal sanity" means almost the complete opposite of what it does for households and businesses. Please (you and many millions of others under the spell of Pete Peterson and all those worthless Clinton retreads) get your head around this. ]]> Thu, 15 Nov 2012 12:18:01 -0500
Which means if this were the 19th century, you would argue for ending or severely curtailing gold mining (which would have made the Long Depression of 1873-1896 even worse than it was, and probably elevated WJ Bryan to the presidency...or worse).

When a sovereign issuer is the monopoly supplier of net financial assets, "fiscal sanity" means almost the complete opposite of what it does for households and businesses. Please (you and many millions of others under the spell of Pete Peterson and all those worthless Clinton retreads) get your head around this. ]]> http://seekingalpha.com/article/922541/comments?source=feed#comment-10518291 10518291 Sun, 14 Oct 2012 12:57:46 -0400 http://seekingalpha.com/article/278357/comments?source=feed#comment-10495851 10495851
Weimar hyperinflation was the proximate cause of National Socialism and WW2??? That's highly debatable.

The Weimar inflation, as bad as it was, was relatively short lived. It was a high-probability risk given a world of fixed-exchange rates, WWI reparations, the loss of a significant portion of its industrial base, and (reportedly, I haven't studied this first hand) govt subsidies to striking expatriated German workers.

But the primary causes of Hitler and WW2, at least in Europe, were the draconian conditions imposed on post-WW1 Germany combined with periodic but severe mismanagement of the global monetary system, especially the Bank of France's (and to a lesser extent, the Fed's) concerted move c. 1931-32 back onto the gold standard at 1914 parity.

The irony is that Germany's current finance ministers and central bankers believe the more serious risk is Weimar-like inflation, and as a result they unwittingly urge the eurozone to behave like France did in 1932. Apparently Germans have forgotten how that ended for France...]]> Sat, 13 Oct 2012 11:14:40 -0400
Weimar hyperinflation was the proximate cause of National Socialism and WW2??? That's highly debatable.

The Weimar inflation, as bad as it was, was relatively short lived. It was a high-probability risk given a world of fixed-exchange rates, WWI reparations, the loss of a significant portion of its industrial base, and (reportedly, I haven't studied this first hand) govt subsidies to striking expatriated German workers.

But the primary causes of Hitler and WW2, at least in Europe, were the draconian conditions imposed on post-WW1 Germany combined with periodic but severe mismanagement of the global monetary system, especially the Bank of France's (and to a lesser extent, the Fed's) concerted move c. 1931-32 back onto the gold standard at 1914 parity.

The irony is that Germany's current finance ministers and central bankers believe the more serious risk is Weimar-like inflation, and as a result they unwittingly urge the eurozone to behave like France did in 1932. Apparently Germans have forgotten how that ended for France...]]> http://seekingalpha.com/article/278357/comments?source=feed#comment-10495661 10495661
You are assuming that the U.S. is a small, open economy, when nothing could be further from the truth. OPEC (read Saudi Arabia, at least up to a recent or near-future point) is the only external institution with any power on this count, and:

(1) that power is subject to all kinds of social, political, and possibly resource constraints (e.g., peak oil);
(2) we have the world's supreme naval and military forces;
(3) we are producing far more energy domestically than in years past.

Fact is, other nations want to sell us stuff, and when they want to put the USDs they receive into a safe interest-bearing 'account,' they will be buying US Treasurys.

Could this eventually change? Of course. But we'll be long dead, and in the meantime, there are many millions of people unemployed and countless real resources underutilized in the U.S.

The 'reduce deficits' mentality gets the natural and obvious priorities exactly backwards. (Many of the people and organizations pushing it know better, but institutional momentum and public pandering are funny like that...)]]> Sat, 13 Oct 2012 11:02:21 -0400
You are assuming that the U.S. is a small, open economy, when nothing could be further from the truth. OPEC (read Saudi Arabia, at least up to a recent or near-future point) is the only external institution with any power on this count, and:

(1) that power is subject to all kinds of social, political, and possibly resource constraints (e.g., peak oil);
(2) we have the world's supreme naval and military forces;
(3) we are producing far more energy domestically than in years past.

Fact is, other nations want to sell us stuff, and when they want to put the USDs they receive into a safe interest-bearing 'account,' they will be buying US Treasurys.

Could this eventually change? Of course. But we'll be long dead, and in the meantime, there are many millions of people unemployed and countless real resources underutilized in the U.S.

The 'reduce deficits' mentality gets the natural and obvious priorities exactly backwards. (Many of the people and organizations pushing it know better, but institutional momentum and public pandering are funny like that...)]]> http://seekingalpha.com/article/278357/comments?source=feed#comment-10495071 10495071
You're being too hard on Christina Romer. Her only failing was that she was unwilling to go over Larry Summers' big fat head, e.g.: http://bit.ly/R4QxT3#

The irony is that at least one long-time Dem (I forget who, unfortunately) wrote a column in late 2008 warning that Obama's heavy reliance on Clinton Administration retreads would be his undoing. ]]> Sat, 13 Oct 2012 10:42:45 -0400
You're being too hard on Christina Romer. Her only failing was that she was unwilling to go over Larry Summers' big fat head, e.g.: http://bit.ly/R4QxT3#

The irony is that at least one long-time Dem (I forget who, unfortunately) wrote a column in late 2008 warning that Obama's heavy reliance on Clinton Administration retreads would be his undoing. ]]> http://seekingalpha.com/article/278357/comments?source=feed#comment-10494681 10494681
Unless you contract all your debts in 'Jareds' that you are the sole monopoly issuer (ignoring the function of private-sector lending institutions for simplicity), running up your credit card is nothing like the U.S. government's deficit spending.

"Who is going to pay?"

If you're talking about your charge card, you are, either with:
(1) dollars that were emitted into existence by USG deficit spending (or non-standard Fed operations); or
(2) credit creation, which requires a sufficient amount of those deficit dollars in (1), along with sound financial regulations, to avoid causing excessive fragility (i.e., leverage) in the financial system.

If you're talking about the US Treasury's "debt," the USG is, without any difficulty whatsoever (a la Japan). Believe it or not, as long as enough of us respect the USG's ability to tax us in USDs, the Treasury does not need your tax dollars or mine to service its debt or acquire goods and services. That's not readily apparent b/c of the institutional frameworks in place, but it's essentially how it works. http://bit.ly/pdbsGa

"Ultimately we are giving Debt as our inheritance to our children"

If the USG does not run sufficient deficits to support full employment, you may well leave more debt to your heirs than you want to.

But as far as UST securities ("the national debt") go, the more there are of them, the more financial assets you and future generations have to work with. (NOTE: This does NOT mean there is no limit to USG deficit spending!)

"Keep this up and all taxes will only cover interest payments on debt."

That might be true if you assume we're on a gold standard or some other external currency fix, but:

(1) we're not and haven't been since 1973 (and not in the classical sense since 1914, save for a couple of brief tries around 1921 and 1932); and
(2) even countries that were, such as England in the mid to late 19th century, were able to support very large govt debt loads.

Unfortunately, mainstream macroeconomic models--the ones that give rise to the soundbites that inspire groundless fears in well-intentioned people like you--have not taken this into account. In a few very important respects, they do a lousy job of reflecting reality.]]> Sat, 13 Oct 2012 10:30:14 -0400
Unless you contract all your debts in 'Jareds' that you are the sole monopoly issuer (ignoring the function of private-sector lending institutions for simplicity), running up your credit card is nothing like the U.S. government's deficit spending.

"Who is going to pay?"

If you're talking about your charge card, you are, either with:
(1) dollars that were emitted into existence by USG deficit spending (or non-standard Fed operations); or
(2) credit creation, which requires a sufficient amount of those deficit dollars in (1), along with sound financial regulations, to avoid causing excessive fragility (i.e., leverage) in the financial system.

If you're talking about the US Treasury's "debt," the USG is, without any difficulty whatsoever (a la Japan). Believe it or not, as long as enough of us respect the USG's ability to tax us in USDs, the Treasury does not need your tax dollars or mine to service its debt or acquire goods and services. That's not readily apparent b/c of the institutional frameworks in place, but it's essentially how it works. http://bit.ly/pdbsGa

"Ultimately we are giving Debt as our inheritance to our children"

If the USG does not run sufficient deficits to support full employment, you may well leave more debt to your heirs than you want to.

But as far as UST securities ("the national debt") go, the more there are of them, the more financial assets you and future generations have to work with. (NOTE: This does NOT mean there is no limit to USG deficit spending!)

"Keep this up and all taxes will only cover interest payments on debt."

That might be true if you assume we're on a gold standard or some other external currency fix, but:

(1) we're not and haven't been since 1973 (and not in the classical sense since 1914, save for a couple of brief tries around 1921 and 1932); and
(2) even countries that were, such as England in the mid to late 19th century, were able to support very large govt debt loads.

Unfortunately, mainstream macroeconomic models--the ones that give rise to the soundbites that inspire groundless fears in well-intentioned people like you--have not taken this into account. In a few very important respects, they do a lousy job of reflecting reality.]]> http://seekingalpha.com/article/877651/comments?source=feed#comment-10000441 10000441 Sat, 29 Sep 2012 11:33:45 -0400 http://seekingalpha.com/article/877651/comments?source=feed#comment-10000421 10000421
First, let me point out that I once sounded quite a bit like you. But I kept learning. And significant policy innovations like the Fed and the New Deal usually come about b/c there are pressing problems to address, not b/c small groups want to get rich. (That usually happens after the fact, or when things are going swimmingly, as in the 1920s or 1990s.)

You're attributing a lot of things to me that I haven't said, here or elsewhere, and that I simply don't believe. I'm not a fan of income taxes. There have been serious design flaws in welfare programs.

Your rants that I've read are decidedly not about level-headed historical judgment and insights. They are politically and personally motivated attacks backed, for the most part, by a lot of nonsense.

And you have a very loose (wildly inaccurate, really) definition of fascism.

But don't challenge me on my understanding and love for this country. And if you ever want to take me on in the subject of U.S. history, especially economic history, I'm here. Bring it on. ]]> Sat, 29 Sep 2012 11:32:23 -0400
First, let me point out that I once sounded quite a bit like you. But I kept learning. And significant policy innovations like the Fed and the New Deal usually come about b/c there are pressing problems to address, not b/c small groups want to get rich. (That usually happens after the fact, or when things are going swimmingly, as in the 1920s or 1990s.)

You're attributing a lot of things to me that I haven't said, here or elsewhere, and that I simply don't believe. I'm not a fan of income taxes. There have been serious design flaws in welfare programs.

Your rants that I've read are decidedly not about level-headed historical judgment and insights. They are politically and personally motivated attacks backed, for the most part, by a lot of nonsense.

And you have a very loose (wildly inaccurate, really) definition of fascism.

But don't challenge me on my understanding and love for this country. And if you ever want to take me on in the subject of U.S. history, especially economic history, I'm here. Bring it on. ]]> http://seekingalpha.com/article/877651/comments?source=feed#comment-10000201 10000201
Leisure = luxury? That's interesting. I can see how they're related, but suspect you might be overstating it.

"I know several people on disability, derelicts, drunks and frauds all of them."

First, you should get new friends. ;) And second, it sounds like they're not enjoying the "lap of luxury" all that much.

"I don't know one of them who is 'disabled'. Not one, yet they all draw a check."

If it's fraud, it's fraud, and should be punished severely. And there are (speaking with strongly instilled cultural values here) pieces of sh*t among us who are happy to steal from others. That may describe all, some, or none of the people you're referring to.

But as I've learned working in other industries, when a person feels they can't get a fair shake at certain economic opportunities and/or outcomes--there are myriad reasons why this can happen, and it's entirely a matter of subjective judgment, so people will never be in complete agreement on it--then certain behaviors are no longer vices, but virtues. This statement shouldn't be all that controversial to anyone who reads, e.g., Ludwig Mises with an open mind, btw.

If you want to drastically cut the SSDI net, be prepared for consequences. And if you only care about the consequences as they affect you, well...that's pretty shitty.]]> Sat, 29 Sep 2012 11:22:49 -0400
Leisure = luxury? That's interesting. I can see how they're related, but suspect you might be overstating it.

"I know several people on disability, derelicts, drunks and frauds all of them."

First, you should get new friends. ;) And second, it sounds like they're not enjoying the "lap of luxury" all that much.

"I don't know one of them who is 'disabled'. Not one, yet they all draw a check."

If it's fraud, it's fraud, and should be punished severely. And there are (speaking with strongly instilled cultural values here) pieces of sh*t among us who are happy to steal from others. That may describe all, some, or none of the people you're referring to.

But as I've learned working in other industries, when a person feels they can't get a fair shake at certain economic opportunities and/or outcomes--there are myriad reasons why this can happen, and it's entirely a matter of subjective judgment, so people will never be in complete agreement on it--then certain behaviors are no longer vices, but virtues. This statement shouldn't be all that controversial to anyone who reads, e.g., Ludwig Mises with an open mind, btw.

If you want to drastically cut the SSDI net, be prepared for consequences. And if you only care about the consequences as they affect you, well...that's pretty shitty.]]> http://seekingalpha.com/article/877651/comments?source=feed#comment-10000031 10000031
The 47% figure is complete BS once you account for payroll taxes. How do you not see this?

And the distribution of the income tax burden could just as well reflect increasing income and wealth inequality (which is no longer an easy myth for right-wing think tanks to 'bust') as people exploiting entitlements and doing nothing.

I believe in our Republic too. You should read more of the source material. ]]> Sat, 29 Sep 2012 11:13:27 -0400
The 47% figure is complete BS once you account for payroll taxes. How do you not see this?

And the distribution of the income tax burden could just as well reflect increasing income and wealth inequality (which is no longer an easy myth for right-wing think tanks to 'bust') as people exploiting entitlements and doing nothing.

I believe in our Republic too. You should read more of the source material. ]]> http://seekingalpha.com/article/877651/comments?source=feed#comment-9999811 9999811
You probably haven't read any of Adam Smith's other books, have you Wyatt?

At least you didn't throw the 'like our Founding Fathers wanted!' tagline on there. Thank you for that. ]]> Sat, 29 Sep 2012 11:05:16 -0400
You probably haven't read any of Adam Smith's other books, have you Wyatt?

At least you didn't throw the 'like our Founding Fathers wanted!' tagline on there. Thank you for that. ]]> http://seekingalpha.com/article/877651/comments?source=feed#comment-9999721 9999721
I declare, what would I do without you here to protect my honor and provide for my edification?

"Take a deep breath, inhale & pop another amil nitrate."

Oops. Scratch that "protect my honor" part.

"Broaden the base means more workers paying into the system, thus backstopping the entitlement wall with more funds."

Oh...you must mean raise the exclusion limit for payroll taxes? You're full of surprises. Otherwise, you're talking about a payroll tax hike, at least if we're focusing on entitlements broadly. If you're talking about aspects of entitlement programs that receive general funding, then obviously you're talking about higher taxes on people at the lower end. But those folks already pay at least the same effective rate as Romney from dollar one via payroll taxes (less some relatively insubstantial give backs on the income tax side for some). The important points are that (1) they're still net federal taxpayers and (2) they tend to have the lowest capacity for absorbing higher effective tax rates. "Broaden the base" is code for raising taxes on lower earners, unless you believe the GOP stands ready to raise taxes on higher earners. (They may eventually, if Boehner can avoid a mutiny.) I'm not for either, btw.

"...just keep hyperventilating into a brown paper bag until after the election is over and Homie Downgrade gets sent back to Chi-Town."

That's beautiful. You're as clever as you are honorable. Guess what? I didn't vote for the guy. I have no horse in this race. I'm a committed (go ahead, run with that one, ya lunatic) independent. But I do enjoy calling BS in the political realm, and in that regard, you bring me much pleasure. :)

"...excessive leverage was due to the ridiculous products of financial 'innovation' from the banking institutions. That's now the GOP, eh?"

Don't fool yourself. Phil Gramm and others in Congress helped spearhead the financial deregulations that made the GFC possible. Some of the tradeoffs given to the financial industry for Patriot Act-related legislation post-9/11 appeared to do the same thing (e.g., leverage caps, derivatives treatment, bankruptcy overhaul, etc.). Was it just the GOP? I already said it wasn't. The Clinton Administration is just as guilty, thanks to the Rubin and his camp, as well as Bubba's inability to control Little Billy. (The Lewinsky scandal and impeachment charade gave the GOP serious policy leverage.)

"Meanwhile, Bush & McCain are on record in 2004 in trying to bring to the Senate floor reforms to Fannie and Freddie and warning the democrat left about financial armageddon. The left didn't want to touch it. MBS bundling was to offset the risk, but when there was so many bad loans in the bundles, there is never enough to offset that risk, even at 5%. Thank your CRA buddies for that. It goes all the way back to Jimmy Carter."

The GSEs were not without blame. I've already pointed out that both the Dems and GOP were at fault. But the CRA hypothesis has been studied empirically and found wanting. Somehow I doubt that means a damn thing to you. It's a lot more fun to say things like, 'Blame Jimmy Carter.'

"Of course the programs can go insolvent, whether or not a check bounces or it is inflated away through printing. Either way, its insolvent, even if it does say United States Treasury in real neato old fashioned letters on the top of the pink check."

No, you're wrong. They can't. Should the USG lose the ability to collect taxes in and otherwise enforce the use of USDs, there would be serious, existential problems. Solvency would become something of a non-issue then. That's an absolute non-issue today though.

So when people say things like 'inflate away through printing' they display profound ignorance of how our current monetary system works. There is only one source of net USDs today, and that's the USG, meaning the USG has essentially assumed the role that precious metals mining and mints did in prior centuries. After a 19th century financial crisis, the last thing anyone in their right mind would have said is, "Stop prospecting and digging up gold, it's inflationary and breaks the social contract." But that's exactly what folks like you do when they get their panties in a bundle about federal govt deficits, 'debt', and solvency.

But like I said, I get it. It's far more enjoyable for you to NOT get your head around this so you can continue to shower the world with golden streams of wisdom.]]> Sat, 29 Sep 2012 10:56:58 -0400
I declare, what would I do without you here to protect my honor and provide for my edification?

"Take a deep breath, inhale & pop another amil nitrate."

Oops. Scratch that "protect my honor" part.

"Broaden the base means more workers paying into the system, thus backstopping the entitlement wall with more funds."

Oh...you must mean raise the exclusion limit for payroll taxes? You're full of surprises. Otherwise, you're talking about a payroll tax hike, at least if we're focusing on entitlements broadly. If you're talking about aspects of entitlement programs that receive general funding, then obviously you're talking about higher taxes on people at the lower end. But those folks already pay at least the same effective rate as Romney from dollar one via payroll taxes (less some relatively insubstantial give backs on the income tax side for some). The important points are that (1) they're still net federal taxpayers and (2) they tend to have the lowest capacity for absorbing higher effective tax rates. "Broaden the base" is code for raising taxes on lower earners, unless you believe the GOP stands ready to raise taxes on higher earners. (They may eventually, if Boehner can avoid a mutiny.) I'm not for either, btw.

"...just keep hyperventilating into a brown paper bag until after the election is over and Homie Downgrade gets sent back to Chi-Town."

That's beautiful. You're as clever as you are honorable. Guess what? I didn't vote for the guy. I have no horse in this race. I'm a committed (go ahead, run with that one, ya lunatic) independent. But I do enjoy calling BS in the political realm, and in that regard, you bring me much pleasure. :)

"...excessive leverage was due to the ridiculous products of financial 'innovation' from the banking institutions. That's now the GOP, eh?"

Don't fool yourself. Phil Gramm and others in Congress helped spearhead the financial deregulations that made the GFC possible. Some of the tradeoffs given to the financial industry for Patriot Act-related legislation post-9/11 appeared to do the same thing (e.g., leverage caps, derivatives treatment, bankruptcy overhaul, etc.). Was it just the GOP? I already said it wasn't. The Clinton Administration is just as guilty, thanks to the Rubin and his camp, as well as Bubba's inability to control Little Billy. (The Lewinsky scandal and impeachment charade gave the GOP serious policy leverage.)

"Meanwhile, Bush & McCain are on record in 2004 in trying to bring to the Senate floor reforms to Fannie and Freddie and warning the democrat left about financial armageddon. The left didn't want to touch it. MBS bundling was to offset the risk, but when there was so many bad loans in the bundles, there is never enough to offset that risk, even at 5%. Thank your CRA buddies for that. It goes all the way back to Jimmy Carter."

The GSEs were not without blame. I've already pointed out that both the Dems and GOP were at fault. But the CRA hypothesis has been studied empirically and found wanting. Somehow I doubt that means a damn thing to you. It's a lot more fun to say things like, 'Blame Jimmy Carter.'

"Of course the programs can go insolvent, whether or not a check bounces or it is inflated away through printing. Either way, its insolvent, even if it does say United States Treasury in real neato old fashioned letters on the top of the pink check."

No, you're wrong. They can't. Should the USG lose the ability to collect taxes in and otherwise enforce the use of USDs, there would be serious, existential problems. Solvency would become something of a non-issue then. That's an absolute non-issue today though.

So when people say things like 'inflate away through printing' they display profound ignorance of how our current monetary system works. There is only one source of net USDs today, and that's the USG, meaning the USG has essentially assumed the role that precious metals mining and mints did in prior centuries. After a 19th century financial crisis, the last thing anyone in their right mind would have said is, "Stop prospecting and digging up gold, it's inflationary and breaks the social contract." But that's exactly what folks like you do when they get their panties in a bundle about federal govt deficits, 'debt', and solvency.

But like I said, I get it. It's far more enjoyable for you to NOT get your head around this so you can continue to shower the world with golden streams of wisdom.]]> http://seekingalpha.com/article/877651/comments?source=feed#comment-9946821 9946821
More jobs??? Good grief. Do you talk out of your a** every day, or just now and again? "Broaden the base" is code for make taxes (and that means ALL TAXES on labor, not just income taxes--exluding them is one of the more disengenous things that the GOP and its think tanks do) LESS PROGRESSIVE. Federal taxes are not breaking anyone in Romney's and similar situations. But they are crushing plenty of household budgets. "Broaden the base" is just one way for the right (and sometimes the left) to say, "Ah, who gives a sh*t?"

"You need more taxpayers if you want to keep the FDR/LBJ and now Obama payroll tax stub deductions afloat, right kid?"

No. You remain utterly clueless about this. I get it. Ignorance feels good when it affirms your political values. But you're still 100% wrong.

"So broaden the damn base! Is Obama gonnuh fix all that? How many jobs has he created? Careful, you need to offset it with how many have dropped out of seeking a job. So we have a net negative still on that front."

Blah, blah, blah. You want to blame the Dem sweep of Congress in 2006 for the lousy employment picture? OK with me. But the GOP probably did more to foster the incredible global financial fragility that preceded it. (Yes, the left tended to favor GSEs and the like, but 70x leverage was GOP and only a handful of Dems like Bob Rubin.) While we're playing the blame game, Larry Summers is my main culprit, as he (allegedly) didn't even show Romer's strongest fiscal plan to Obama. That said, the program they did implement sure as hell helped.

"Ryan, so far, is the only one talking about the insolvency of these programs."

Those programs can't go insolvent, any more than the NFL can run out of points to put on the scoreboard (unless Congress decides to stop funding them, but that has nothing to do with the ability to fund them). They influence how the command of real goods and services is allocated, period. And demographic swings can amplify or dampen the effects.

And guess what? Ryan must surely know this. He's pandering to you, and you're swallowing it hook, line, and sinker. ]]> Thu, 27 Sep 2012 19:46:50 -0400
More jobs??? Good grief. Do you talk out of your a** every day, or just now and again? "Broaden the base" is code for make taxes (and that means ALL TAXES on labor, not just income taxes--exluding them is one of the more disengenous things that the GOP and its think tanks do) LESS PROGRESSIVE. Federal taxes are not breaking anyone in Romney's and similar situations. But they are crushing plenty of household budgets. "Broaden the base" is just one way for the right (and sometimes the left) to say, "Ah, who gives a sh*t?"

"You need more taxpayers if you want to keep the FDR/LBJ and now Obama payroll tax stub deductions afloat, right kid?"

No. You remain utterly clueless about this. I get it. Ignorance feels good when it affirms your political values. But you're still 100% wrong.

"So broaden the damn base! Is Obama gonnuh fix all that? How many jobs has he created? Careful, you need to offset it with how many have dropped out of seeking a job. So we have a net negative still on that front."

Blah, blah, blah. You want to blame the Dem sweep of Congress in 2006 for the lousy employment picture? OK with me. But the GOP probably did more to foster the incredible global financial fragility that preceded it. (Yes, the left tended to favor GSEs and the like, but 70x leverage was GOP and only a handful of Dems like Bob Rubin.) While we're playing the blame game, Larry Summers is my main culprit, as he (allegedly) didn't even show Romer's strongest fiscal plan to Obama. That said, the program they did implement sure as hell helped.

"Ryan, so far, is the only one talking about the insolvency of these programs."

Those programs can't go insolvent, any more than the NFL can run out of points to put on the scoreboard (unless Congress decides to stop funding them, but that has nothing to do with the ability to fund them). They influence how the command of real goods and services is allocated, period. And demographic swings can amplify or dampen the effects.

And guess what? Ryan must surely know this. He's pandering to you, and you're swallowing it hook, line, and sinker. ]]> http://seekingalpha.com/article/877651/comments?source=feed#comment-9867881 9867881 Wed, 26 Sep 2012 00:09:41 -0400 http://seekingalpha.com/article/877651/comments?source=feed#comment-9867831 9867831
Two links to the same John Law article, and you still have no idea what you are talking about. Seriously. ]]> Wed, 26 Sep 2012 00:06:22 -0400
Two links to the same John Law article, and you still have no idea what you are talking about. Seriously. ]]> http://seekingalpha.com/article/877651/comments?source=feed#comment-9867741 9867741
Well said, bubble boy. You should brush up on your math skills though. Don't think you fully grasp the concept of 'exponential.' ]]> Tue, 25 Sep 2012 23:58:45 -0400
Well said, bubble boy. You should brush up on your math skills though. Don't think you fully grasp the concept of 'exponential.' ]]> http://seekingalpha.com/article/877651/comments?source=feed#comment-9867541 9867541
So do what Alex Baldwin didn't have the balls to do and leave. Not to scoff at human capital flight, but I suspect you wouldn't be leading a mass emigration. ]]> Tue, 25 Sep 2012 23:46:03 -0400
So do what Alex Baldwin didn't have the balls to do and leave. Not to scoff at human capital flight, but I suspect you wouldn't be leading a mass emigration. ]]> http://seekingalpha.com/article/877651/comments?source=feed#comment-9867471 9867471
No, he didn't. Law's approach was extreme financial leverage on a base convertible into precious metals. The fact that you think that's the same thing exposes you on this issue. Do some homework. ]]> Tue, 25 Sep 2012 23:40:34 -0400
No, he didn't. Law's approach was extreme financial leverage on a base convertible into precious metals. The fact that you think that's the same thing exposes you on this issue. Do some homework. ]]> http://seekingalpha.com/article/877651/comments?source=feed#comment-9867381 9867381
Good grief. Happy 120th birthday, Wyatt. ]]> Tue, 25 Sep 2012 23:37:03 -0400
Good grief. Happy 120th birthday, Wyatt. ]]> http://seekingalpha.com/article/877651/comments?source=feed#comment-9867311 9867311
Does anyone here actually know anyone on SSDI? Not exactly the lap of luxury. ]]> Tue, 25 Sep 2012 23:33:08 -0400
Does anyone here actually know anyone on SSDI? Not exactly the lap of luxury. ]]>