Spend or Save?

[william the wie]

Stimulus does not aid long or even intermediate run growth. Growth comes from investment and investment in exports in particular i. e. net individual, corporate and government savings must increase in order for sustainable growth to be created. The current form of stimulus is worthless except as a sugar high. There are forms of stimulus that do work such as the DARPA prize money contests that work very well indeed but to demonstrate the errors in current thinking look at the Healthcare bill.

Does it take the Swedish idea of indexing life expectancy to pensions and run with it? No. (this counterintuitively is by far the biggest error of omission. The longer the working life the greater the tax revenue per person for supporting healthcare.)

Does it further reward healthcare breakthroughs that provide better and/or cheaper treatments with prize money? No.

Does it require a minimum even 1% copay to prevent the waste of medical resources? no.

The kind of stimulus being practiced reduces growth in the long run.

 

[editec]

If our societies were identical, then asking that question might make sense.

But as they're different in multiple ways, each of which effects the economy, there might be different winning (or losing) approaches for each nation

For instance...Germany's is trying an austerity approach, but their unemployment rate actually went down. Germany decreased average weekly hours so that people wouldn't be laid off.

The USA cannot even attempt such a plan.

So...how do you compare different nations and make sense of it?

Economics isn't like the physical sciences.

One formula of success or failure does not fit all

Each national economy is unique. And over time even the same national economy changes, too -- as multiple conditions within that economy change, or multiple conditions outside of that economy, change.

Hence, one approach might work under one conditionic cicumstance, and totally fail under another circumstance even within the same nation.

Again, that's another reason economics is called the DISMAL science.

i'd agree that there's conditions to economic policy, but i feel the idea of choking an economy in a recovery survives all these conditions, netting the same or similar effect in all economies from bangladesh to belgium.

it is yet to be seen if this is hot air or if these economies will implement their threatened austerity measures. if they do, particularly to the degree which the UK intends, i think the result will be a vindication for those who feel the basis of conservative economic theory is from the ass end of a steer.

One size economics does not fit all, sport.

They put an accelorators and brakes and steering wheels on cars for a reason.

You people who think there's a single solution to every economic situtation and every different economy are simply wrong.

If you'd step out of from those goofy ideological straightjackets you're so comfortable in for just a freaking moment, you're realize just how silly it is to think that the solution to every economy is always the SAME GOD DAMNED THING YOUR MASTERS HAVE BEEN TELLING YOU FOR THE LAST HALF CENTURY.

 

[boedicca]

Handing out unemployment checks funded by taking money away from other people isn't investment and doesn't create jobs.

Just saying.

 

[2Parties]

The Fed by controlling interest rates screws up the market. They encourage spending when people want to save and the opposite. Instead of letting the free market determine it they create giant bubbles that aren't backed by real saving...

 

[antagon]

If our societies were identical, then asking that question might make sense.

But as they're different in multiple ways, each of which effects the economy, there might be different winning (or losing) approaches for each nation

For instance...Germany's is trying an austerity approach, but their unemployment rate actually went down. Germany decreased average weekly hours so that people wouldn't be laid off.

The USA cannot even attempt such a plan.

So...how do you compare different nations and make sense of it?

Economics isn't like the physical sciences.

One formula of success or failure does not fit all

Each national economy is unique. And over time even the same national economy changes, too -- as multiple conditions within that economy change, or multiple conditions outside of that economy, change.

Hence, one approach might work under one conditionic cicumstance, and totally fail under another circumstance even within the same nation.

Again, that's another reason economics is called the DISMAL science.

i'd agree that there's conditions to economic policy, but i feel the idea of choking an economy in a recovery survives all these conditions, netting the same or similar effect in all economies from bangladesh to belgium.

it is yet to be seen if this is hot air or if these economies will implement their threatened austerity measures. if they do, particularly to the degree which the UK intends, i think the result will be a vindication for those who feel the basis of conservative economic theory is from the ass end of a steer.

One size economics does not fit all, sport.

They put an accelorators and brakes and steering wheels on cars for a reason.

You people who think there's a single solution to every economic situtation and every different economy are simply wrong.

If you'd step out of from those goofy ideological straightjackets you're so comfortable in for just a freaking moment, you're realize just how silly it is to think that the solution to every economy is always the SAME GOD DAMNED THING YOUR MASTERS HAVE BEEN TELLING YOU FOR THE LAST HALF CENTURY.

contrary to this view, i think that there are some mechanics within an economy on which we could base the role of governments in the economic cycle. what i think is stupid is doing the same god damned thing that failed in extreme economic circumstances and expecting the same result. i feel that those actions are the ones which are found in ideological straight jackets, because they aren't found in economics... just in politics. perhaps the role of politics is at the center of my indictment of the UK's economic policy, and i feel that their direction is less informed by the economic history.

paralleling the extreme nature of the view that attempting stimulus in a downturn implies application of a single solution without respect to its cause, where does that leave the concept of reinventing the wheel in times of need?

 

[antagon]

The Fed by controlling interest rates screws up the market. They encourage spending when people want to save and the opposite. Instead of letting the free market determine it they create giant bubbles that aren't backed by real saving...

interest rates are determined by market values. do you know how that works?

 

[topspin]

China is growing at 10% so if that's tanking maybe we need to tank.
Brazil is growing as well though I don't know the number, I suspect energy is a huge part of their economy with all the deepwater discoveries they had recently.

 

[antagon]

China is growing at 10% so if that's tanking maybe we need to tank.
Brazil is growing as well though I don't know the number, I suspect energy is a huge part of their economy with all the deepwater discoveries they had recently.

through their ethanol industry, brazil does well for themselves in the energy game. they have a lot going for them from edible exports to a commitment to domestic infrastructure which mexico, for example, has not tended to as efficiently.

i think china will take an extended dip, and i dont think that it will be the kind to make their products more affordable. instead, i think that the developed world may have to go shopping among the many other eager producers in the region.

 

[Douger]

Cruise around over here.

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