FOMC 2006 Transcripts: The 1% Solution

Markets are not naturally occurring phenomena; they are man made, and for thousands of years the greediest of men have made the rules governing how markets function.

China just switched to free capitalist markets after 1000's of years and instantly transformed 15 million human beings from starving to death to rich enough to buy cars. Its one of many very obvious examples.

Now we can see how truly brain dead liberalism is.

About as dead as human rights in China.

the liberal lost the debate so is trying to switch the subject to human rights from capitalist free markets. Do you think it was not obvious??

Also, the first human right is to have free markets so millions and millions don't slowly starve to death under liberal regulation.
The nefarious conservative claims I'm switching the subject from capitalism to human rights, yet also informs us the first human right is to have "free markets"?

Is it fair to say China's free market was birthed in Tiananmen Square?

"The Tiananmen Square protests of 1989, also known as the June Fourth Incident in Chinese[1] were a series of demonstrations in and near Tiananmen Square in Beijing in the People's Republic of China (PRC) beginning on 15 April 1989..."

"Party authorities declared martial law on 20 May, but no military action took place until 4 June, when the People's Liberation Army moved into the streets of Beijing, using live fire while proceeding to Tiananmen Square to clear the area of protestors.

"The exact number of civilian deaths is not known, and the majority of estimates range from several hundred to thousands."

Tiananmen Square protests of 1989 - Wikipedia, the free encyclopedia

Progressives would argue free speech trumps free markets.
 
They also totally ignored how intertwined housing had become with the financial sector and how it could very easily pull the entire economy down with it.

So did everybody.

Every 10 or 15 years or so we tend to drink this Kool-aid fed to us by the Paul Krugman types that all of a sudden we are in a "new economy" and that economic models all of a sudden do not matter anymore. They're trying to do it again by convincing us that public debt is simply not a problem, and will never be a problem because yields are so low. They're idiots. It's almost as though they're wrecking this country on purpose because to believe they're simply unable to do their jobs is too much of a stretch.

Nobody says we are in a "new economy" where any amount of debt isn't a problem. What people like Krugman are saying is that the most pressing issue right now is jobs and economic growth. Somehow the debt has managed to take centre stage in both the media and political discussion despite the fact that it's not the most urgent problem right now. The most urgent problem is not having an economy trapped the same way Japan's has been for the past 20 years ending up with very little growth and debt that's 200% of GDP. The point about interest rates is that the economic malaise isn't caused by fear of huge debt, as some people would have you believe.

Krugman said the same thing about this "new economy" ten years ago in his book the great unravelling, where he blamed Bush for the early 2000's recession as if the dotcom bubble had nothing to do with it. Many on the left are in fact saying that the current fiscal debt implosion is a non issue. We're borrowing 1.2 trillion, 1.4 trillion, 1.7 trillion per year. What would be a satisfactory amount for the Krugman types? 3 trillion, 7 trillion? This guy's dangerous.

And no, it wasn't just the feds who ignored the indicators, but if they were doing their jobs they would see what the indicators were really saying - that we had no real income growth, and that the current levels of spending were being fueled by home appreciation. They failed at their jobs, and this is what the report illustrates.
 
Oh yeah - as if everything we've experienced the last few years was concocted in November 2006. It built up much longer than that. By 2006 it wouldn't matter what action they had taken even if they foresaw this - they could have moved heaven and earth and we still would have watched out economy implode.

There's no reason the economy should have imploded due to the housing bubble. In fact following the crash of the housing bubble, the economy didn't implode. It only imploded once the Federal Reserve allowed inflation and NGDP expectations to collapse.

Why? Because it took 18 months before the economy started contracting? You're completely discounting housings affect on the financial sector, once this part of the economy imploded the economy contracted. It had nothing to do with inflation expectations - this indicator was increasing all the way through summer 2008.
 
They also totally ignored how intertwined housing had become with the financial sector and how it could very easily pull the entire economy down with it.

So did everybody.

Every 10 or 15 years or so we tend to drink this Kool-aid fed to us by the Paul Krugman types that all of a sudden we are in a "new economy" and that economic models all of a sudden do not matter anymore. They're trying to do it again by convincing us that public debt is simply not a problem, and will never be a problem because yields are so low. They're idiots. It's almost as though they're wrecking this country on purpose because to believe they're simply unable to do their jobs is too much of a stretch.

Nobody says we are in a "new economy" where any amount of debt isn't a problem. What people like Krugman are saying is that the most pressing issue right now is jobs and economic growth. Somehow the debt has managed to take centre stage in both the media and political discussion despite the fact that it's not the most urgent problem right now. The most urgent problem is not having an economy trapped the same way Japan's has been for the past 20 years ending up with very little growth and debt that's 200% of GDP. The point about interest rates is that the economic malaise isn't caused by fear of huge debt, as some people would have you believe.

Krugman said the same thing about this "new economy" ten years ago in his book the great unravelling, where he blamed Bush for the early 2000's recession as if the dotcom bubble had nothing to do with it.

Haven't read it. Only read his blog. If you can post the supporting quotes, that'd be cool.

Many on the left are in fact saying that the current fiscal debt implosion is a non issue. We're borrowing 1.2 trillion, 1.4 trillion, 1.7 trillion per year. What would be a satisfactory amount for the Krugman types? 3 trillion, 7 trillion? This guy's dangerous.

He's not dangerous. He just wants to restore nominal variables to the level where they don't have real effects. Unfortunately, he wants to do that with fiscal stimulus.


And no, it wasn't just the feds who ignored the indicators, but if they were doing their jobs they would see what the indicators were really saying - that we had no real income growth, and that the current levels of spending were being fueled by home appreciation. They failed at their jobs, and this is what the report illustrates.

Which isn't relevant to nominal variables. The Fed controls the path of nominal variables; people spending through home appreciation does not change nominal spending. And it's only when nominal variables have to fall is it that a demand-side recession takes place. The Fed allowed NGDP to fall 9% below trend. There was no reason this had to happen, and as such, there was no reason the downturn had to be so deep and prolonged. This is a failure of monetary policy, just like the Depression was. It's all just a little bit of history repeating.
 
Oh yeah - as if everything we've experienced the last few years was concocted in November 2006. It built up much longer than that. By 2006 it wouldn't matter what action they had taken even if they foresaw this - they could have moved heaven and earth and we still would have watched out economy implode.

There's no reason the economy should have imploded due to the housing bubble. In fact following the crash of the housing bubble, the economy didn't implode. It only imploded once the Federal Reserve allowed inflation and NGDP expectations to collapse.

Why? Because it took 18 months before the economy started contracting?

That's evidence in support of my position, yes.

You're completely discounting housings affect on the financial sector, once this part of the economy imploded the economy contracted.

I'm not discounting them at all. That would have caused a mild and short downturn.

It had nothing to do with inflation expectations - this indicator was increasing all the way through summer 2008.

The 10 year TIPS spread disagrees:

fredgraph.png
 
Could you imagine a US future where Goldmans and the Pentagon serve the same function as generals in China today?

"Thus the control and ownership that U.S. share ownership represents is completely different than what Chinese share ownership represents. Simply put, Chinese shares don't translate into effective ownership of their underlying companies."

Here's Why Chinese Stock Markets Remain A State-Controlled Facade - Business Insider
 
Markets are not naturally occurring phenomena; they are man made, and for thousands of years the greediest of men have made the rules governing how markets function.

China just switched to free capitalist markets after 1000's of years and instantly transformed 15 million human beings from starving to death to rich enough to buy cars. Its one of many very obvious examples.

Now we can see how truly brain dead liberalism is.
About as dead as human rights in China.

human rights may be dead but 10 million human beings a year are no longer starving to death thanks to the switch to Republican capitalism.

Did the liberal fool himself by trying to change the subject from starving to death to human rights????
 
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Somehow the debt has managed to take centre stage in both the media and political discussion despite the fact that it's not the most urgent problem right now. The most urgent problem is not having an economy trapped the same way Japan's has been for the past 20 years ending up with very little growth and debt that's 200% of GDP. The point about interest rates is that the economic malaise isn't caused by fear of huge debt, as some people would have you believe.

of course as a liberal you will misunderstand everything. Japan has no growth because it has 200% debt, zombie bailed out banks, and 10,000 stimulus bridges to no where.

The solution for Japan and the USA is an immediate return to free market Republican capitalism and real growth.
 
The largest single stockholder of most of the exporting industries in China is the Chinese MILITARY contolled by the Communist insiders.

According to to most important book on the subject: "Capitalism with Chinese Characteristics" that is not true, but for our purposes it does not matter anyway.

The fact is, in 1978 they switched to capitalism and went from mass starvation to buying more cars than we do. Most importantly capitalism means: 1) shopping with your own money, 2) earning money in open competition with other wage earners and 3) making and pricing goods and services to compete in a free market place.
 
China just switched to free capitalist markets after 1000's of years and instantly transformed 15 million human beings from starving to death to rich enough to buy cars. Its one of many very obvious examples.

Now we can see how truly brain dead liberalism is.
About as dead as human rights in China.

human rights may be dead but 10 million human beings a year are no longer starving to death thanks to the switch to Republican capitalism.

Did the liberal fool himself by trying to change the subject from starving to death to human rights????
Subsistence is a human right.
Only conservatives would accept a choice of starvation or slavery.

"Yes we know, there's no such thing as a perfectly free market. There are degrees of freedom, however.

"The chart below from Goldman shows how Chinese stock markets have some of the lowest free floats around. This is because the vast majority of shares for companies listed on Chinese stock markets remain state-owned..."

"Thus the control and ownership that U.S. share ownership represents is completely different than what Chinese share ownership represents. Simply put, Chinese shares don't translate into effective ownership of their underlying companies.

Here's Why Chinese Stock Markets Remain A State-Controlled Facade - Business Insider
 
Subsistence is a human right.

obviously it wasn't under liberalism in China since 10 million a year starved to death.


Only conservatives would accept a choice of starvation or slavery.

no idea what you mean or what your subject is???? Do you have any idea????

"Yes we know, there's no such thing as a perfectly free market. There are degrees of freedom, however.

did someone disagree?????????????????????


"The chart below from Goldman shows how Chinese stock markets have some of the lowest free floats around. This is because the vast majority of shares for companies listed on Chinese stock markets remain state-owned..."

and your point is???????????????????????????


"Thus the control and ownership that U.S. share ownership represents is completely different than what Chinese share ownership represents. Simply put, Chinese shares don't translate into effective ownership of their underlying companies.

and you're point is??????
 
When did "liberalism" ever prevail in China?

liberalism or communism prevailed until 1978. Liberalism is watered down communism on the way to real communism. Liberalism has no natural limits short of communism. Why did you think our liberals spied for Stalin and gave him the bomb?

Norman Thomas quotes:

The American people will never knowingly adopt Socialism. But under the name of 'liberalism' they will adopt every fragment of the Socialist program, until one day America will be a Socialist nation, without knowing how it happened.


This was precisely the tactic of “infiltration” advocated by Lenin and Stalin.[3] As Communist International General Secretary Georgi Dimitroff told the Seventh World Congress of the Comintern in 1935:
"Comrades, you remember the ancient tale of the capture of Troy. Troy was inaccessible to the armies attacking her, thanks to her impregnable walls. And the attacking army, after suffering many sacrifices, was unable to achieve victory until, with the aid of the famous Trojan horse, it managed to penetrate to the very heart of the enemy’s camp."[4]

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Buckley endorsed Chambers’ analysis of modern liberalism as a watered-down version of Communist ideology. The New Deal, Chambers insists, is not liberal democratic but “revolutionary” in its nature and intentions, seeking “a basic change in the social and, above all, the power relationships within the nation.”
 
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Liberalism believes in individual freedom while communism stands for the equality of all, giving priority to the welfare of society while liberalism prioritizes the rights of individuals. Liberalism imagines a free market where communism fantasizes that it is the community or society that controls the economy and the means of production. Liberalism divides profit into shares that are apportioned on an individual basis while profit is equally shared in communism.

If we're discussing the same Norman Thomas, he wasn't highly regarded by the Bolsheviks:

"Thomas frequently spoke on the difference between socialism and communism, explaining the differences between the movement he represented and that of revolutionary Marxism.

"His early admiration for the Russian Revolution subsequently turned into energetic anti-communism. (The revolutionaries thought him no better; Leon Trotsky, on more than one occasion, levelled high-profile criticism at Thomas.)

"He wrote several books, among them his passionate defense of World War I conscientious objectors, Is Conscience a Crime?, and his statement of the 1960s social democratic consensus, Socialism Re-examined."

Norman Thomas - Wikipedia, the free encyclopedia
 

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