And the Nobel in Economics Goes To.....

[Pksimon2007]

"uh, so what's happening with the US economy? Er, that would take a lot of research to know, and we haven't done any actual research. We're just here for the swag bag."

So they get the prize for their work on how to measure the economy, and fail to answer the question of what's wrong with it. That wasn't a stupid response, in context that was just a stupid question. Everyone knows that if you really want to know what's wrong with the economy you just ask Paul Krugman.

- Ah. So you've heard of Krugman? What kind of economist is he?

He describes himself as neo-Keynesian macroeconomist. Also, classical. Pre-Austrian.

He's about the only economist who's been right the last 10 years more times than he's been wrong, and one of the only ones to admit being wrong publicly.

And, as it turns out, we have similar tastes in music... he tends to be a bit more Bohemian sometimes.

- He describes himself as a New Keynesian, which is a form of monetarist neoclassical which has nothing to do with Keynes.

 

[Pksimon2007]

"uh, so what's happening with the US economy? "

simple, way too much liberal distorting interference. For example, without Obamacare and the other libcommie interventions health care would cost 20% of what it does today.

- Oddly, in countries with even more "libcommie interventions", healthcare is cheaper.

100% stupid and liberal !! how can you have more lib commie interventions than we have? The NHS is a very efficient socialist bureaucracy. We have a huge spaghetti mess. Please think before you post!!

- And the Academy Award for the best dramatic performance in a db post goes to Edward.

 

[CultureCitizen]

"uh, so what's happening with the US economy? Er, that would take a lot of research to know, and we haven't done any actual research. We're just here for the swag bag."

So they get the prize for their work on how to measure the economy, and fail to answer the question of what's wrong with it. That wasn't a stupid response, in context that was just a stupid question. Everyone knows that if you really want to know what's wrong with the economy you just ask Paul Krugman.

- Ah. So you've heard of Krugman? What kind of economist is he?

I have mixed feelings about Krugman ... while I certainly like his point of view, I strongly disagree with him regarding the peril of debt and the effects of QE. I personally prefer Joseph Stiglitz , he is more carefull with his research.

Paul Krugman on Asset bubbles caused by QE4
"Two things. We don’t know that. Asset bubbles have happened even without not-so-easy money. And, in a depressed economy, where alternative uses of money are not great, people are going to bid up the prices of profitable corporations and stuff like that. So it’s not clear."

Why Paul Krugman thinks inflation fears are baloney

I think PK would, at this point, pull out a graph and show you that really, debt is just money we owe ourselves. Since it's ours, we can pay ourselves back at any time.
And just what have the effects of QE been? An economic recovery? Why is that a bad thing (assuming, of course, that your goal would have been a recovery).

Debt, it is not so bad for the US since it is still the main reserve currency . That is changing .
The Yuan will become the main reserve currency in the future and the US will no longer be able to pay itself by printing USD. It will also have to pay higher interest rates. THAT is a big mid term risk.

So while I agree debt has its uses ( improving the water infrastructure and technology in Southwest US comes to my mind), getting to much debt with the risk of a spike in interest rates is foolhardy.

The QE has created asset bubbles in the stock and real estate markets.It might not look like a bad thing until you notice no actual investment is being done because 1 percenters are too busy playing at the wall street casino.

 

[EdwardBaiamonte]

- Right. Because offering an economic opinion is something economists are absolutely not supposed to do.

correct, they are not supposed to do it because anybody can do it. An economist is supposed to be elite.

Do you understand?

 

[EdwardBaiamonte]

Debt, it is not so bad for the US.

of course thats very stupid. Growing debt has to be paid back with interest and growing taxes that cripple the economy . In this case it is govt debt which is wasted on welfare and bridges to no where making it much worse. Its like paying off a house that you don't get to live in. It lowers your standard of living.

 

[EdwardBaiamonte]

The QE has created asset bubbles in the stock and real estate markets..

What a smug liberal ass. If true sell your house and short the stock and real estate markets!!

I do realize you're the lib fool who wants to ban international trade so we have to grow our own bananas at 50 times the cost.

 

[EdwardBaiamonte]

Yep - tax the rich hard and spend it to build the middle class to the point where they can support a booming economy again..

100% stupid and liberal of course. Why not give us your best example of how libturd bureaucratic govt would make this magic happen.

OF course the obvious way to make the economy boom again is to copy China [ dah!!!since their economy has been booming for 30 years] and switch to Republican capitalism.

Do you understand?

 

[Mac1958]

Economists are cute little theorists and all, but few in the financial industry pay them much attention.

What's the old saying: "Economists have predicted 15 of the last six recessions".

Just stay at your desks and pump out theories, guys, have fun with that.



.

 

[EdwardBaiamonte]

Economists are cute little theorists and all, but few in the financial industry pay them much attention.

What's the old saying: "Economists have predicted 15 of the last six recessions".

Just stay at your desks and pump out theories, guys, have fun with that.



.

Their basic theory is that there is a free lunch and they can tell us how to manipulate monetary and fiscal policy to get it. The truth is we got from the stone age to here because Republicans invented or supplied things that improved our standard of living.
.

 

[CultureCitizen]

What a smug liberal ass. If true sell your house and short the stock and real estate markets!!

I do realize you're the lib fool who wants to ban international trade so we have to grow our own bananas at 50 times the cost.

Smarter even : buy my mortgage from the bank , sell it to the fed as triple A asset and then default on it.
That's QE mostly.

 

[oldernwiser]

Yep - tax the rich hard and spend it to build the middle class to the point where they can support a booming economy again..

100% stupid and liberal of course. Why not give us your best example of how libturd bureaucratic govt would make this magic happen.

OF course the obvious way to make the economy boom again is to copy China [ dah!!!since their economy has been booming for 30 years] and switch to Republican capitalism.

Do you understand?

I fully understand that you still haven't figured things out yet.
Why is China booming? Because there are people who buy their goods.
Why isn't ours? Because WE can't even afford to buy the things we make.

Plus, dear Ed, we've been in the grips of Reagan Republican capitalism the whole time Asia has been stripping our jobs from us. Republican capitalism is oil and gas. And of course a massive military.

 

[oldernwiser]

"uh, so what's happening with the US economy? Er, that would take a lot of research to know, and we haven't done any actual research. We're just here for the swag bag."

So they get the prize for their work on how to measure the economy, and fail to answer the question of what's wrong with it. That wasn't a stupid response, in context that was just a stupid question. Everyone knows that if you really want to know what's wrong with the economy you just ask Paul Krugman.

- Ah. So you've heard of Krugman? What kind of economist is he?

He describes himself as neo-Keynesian macroeconomist. Also, classical. Pre-Austrian.

He's about the only economist who's been right the last 10 years more times than he's been wrong, and one of the only ones to admit being wrong publicly.

And, as it turns out, we have similar tastes in music... he tends to be a bit more Bohemian sometimes.

- He describes himself as a New Keynesian, which is a form of monetarist neoclassical which has nothing to do with Keynes.

For someone that has nothing to do with Keynes, Krugman sure quotes him a lot. Stiglitz too. And he does one thing that not many others do - he questions conventional wisdom, especially when the science behind it is weak or there doesn't seem to be enough data to support it.

 

[oldernwiser]

Debt, it is not so bad for the US.

of course thats very stupid. Growing debt has to be paid back with interest and growing taxes that cripple the economy . In this case it is govt debt which is wasted on welfare and bridges to no where making it much worse. Its like paying off a house that you don't get to live in. It lowers your standard of living.

The key word here, dear Ed, is "eventually". If we stay current on our foreign obligations, and despite a recalcitrant congress we've managed to do so, we can continue to borrow from ourselves almost indefinitely. And, since you seem to be the board's economic expert, when is the very best time to borrow? I'm not an economist either, but I am smart enough to know that it's when the interest rates are at rock bottom - as they've been since shortly after the housing bubble burst and all the big banks began to fail. From a lender's standpoint, what's better: getting all your principle back or getting interest payments along with installments over a very long course of time?

And, dear Ed, you might label this a liberal point of view. I look as mere practicality - neither liberal nor conservative. Because if the cost of borrowing were as high as they were say when Reagan started messing around there's no way I could come to the same conclusion. We'd have a different problem then, with a different solution set.

 

[CultureCitizen]

Debt, it is not so bad for the US.

of course thats very stupid. Growing debt has to be paid back with interest and growing taxes that cripple the economy . In this case it is govt debt which is wasted on welfare and bridges to no where making it much worse. Its like paying off a house that you don't get to live in. It lowers your standard of living.

If you are going to quote me quote the whole paragraph. Don't take my sentense out of context.

 

[oldernwiser]

What a smug liberal ass. If true sell your house and short the stock and real estate markets!!

I do realize you're the lib fool who wants to ban international trade so we have to grow our own bananas at 50 times the cost.

Smarter even : buy my mortgage from the bank , sell it to the fed as triple A asset and then default on it.
That's QE mostly.

Actually it isn't.

"uh, so what's happening with the US economy? Er, that would take a lot of research to know, and we haven't done any actual research. We're just here for the swag bag."

So they get the prize for their work on how to measure the economy, and fail to answer the question of what's wrong with it. That wasn't a stupid response, in context that was just a stupid question. Everyone knows that if you really want to know what's wrong with the economy you just ask Paul Krugman.

- Ah. So you've heard of Krugman? What kind of economist is he?

I have mixed feelings about Krugman ... while I certainly like his point of view, I strongly disagree with him regarding the peril of debt and the effects of QE. I personally prefer Joseph Stiglitz , he is more carefull with his research.

Paul Krugman on Asset bubbles caused by QE4
"Two things. We don’t know that. Asset bubbles have happened even without not-so-easy money. And, in a depressed economy, where alternative uses of money are not great, people are going to bid up the prices of profitable corporations and stuff like that. So it’s not clear."

Why Paul Krugman thinks inflation fears are baloney

I think PK would, at this point, pull out a graph and show you that really, debt is just money we owe ourselves. Since it's ours, we can pay ourselves back at any time.
And just what have the effects of QE been? An economic recovery? Why is that a bad thing (assuming, of course, that your goal would have been a recovery).

Debt, it is not so bad for the US since it is still the main reserve currency . That is changing .
The Yuan will become the main reserve currency in the future and the US will no longer be able to pay itself by printing USD. It will also have to pay higher interest rates. THAT is a big mid term risk.

So while I agree debt has its uses ( improving the water infrastructure and technology in Southwest US comes to my mind), getting to much debt with the risk of a spike in interest rates is foolhardy.

The QE has created asset bubbles in the stock and real estate markets.It might not look like a bad thing until you notice no actual investment is being done because 1 percenters are too busy playing at the wall street casino.

Of course that COULD happen. The world could change to the euro too. However, the dollar is still very strong and more stable so it would take a LOT of convincing to make the rest of the world change their minds about common funds. But, it's not impossible either. If Congress stalls on debt repayments again to the point of default, we could trigger some serious thinking about a switch.

Now I'm not going to pretend to know the math behind this - Krugman does go into quite a lot of detail, so I'll leave it to you to glean what you can - but it seems that we're pretty much stuck at very low interest rates and will be for a while. Even if the fed does raise rates, it looks almost certain that the impact will be in lost employment which would trigger another recession (which would force the fed to shift back closer to zero again).

We're going way off topic here, but think of it this way. If the costs of borrowing right now are as close to zero as they can get and we borrow madly against that for infrastructure programs, the rates we'll pay for today's borrowing isn't going to change no matter how long we take to pay ourselves back. In the interim, if that borrowing were to cause a modest 10% increase in revenues due to increased numbers of taxpayers and rising wages, we end up with a gross surplus. And that means that we don't have to struggle nearly so hard to make the payments on notes with much higher rates. Having more cash would mean more spending which means individual investing for lower income people. They start to gain assets and it closes the disparity gap a little.

Of course, this just opened me up for a rant by some of the crazy conservatives, but it's just the truth.

 

[oldernwiser]

Debt, it is not so bad for the US.

of course thats very stupid. Growing debt has to be paid back with interest and growing taxes that cripple the economy . In this case it is govt debt which is wasted on welfare and bridges to no where making it much worse. Its like paying off a house that you don't get to live in. It lowers your standard of living.

Ed... that's mountain out a molehill. It would mean rebuilding bridges that have already begun to crumble - they actually go places and cross real rivers and stuff. Whole interstates (these are existing right this minute and have definite beginning and end points) have had to be closed already because, well, because conservatives tend to think that if you build something once that should be the end of it.

And, while I'm on it, conservatives tend to want to end welfare - which I, as a liberal, am heartily in favor of. So, if the opposite of welfare is gainful employment why not repair an infrastructure that we already know needs it and get more people working thus reducing the number of people collecting a check for watching TV to those who can't do much more than that? Can you rationally explain how that would be a bad idea? (I think you'd be the first, but you're welcome to give it a shot.)

 

[CultureCitizen]

Actually it isn't.

Could you ellaborate ?
I think banks and the Fed have been quite cynical regarding QE and specially QE3.
The Feds buy assets from the banks. The banks (and only them ) kind of know the quallity of those assets.
And the Fed purchases them expecting to recover the price. QE3 is over , but I don't really know anyone who knows exactly what's on those assets ( subprimes + CDS from entities who can't cover the default maybe?).
So yea, buying and selling my mortgage and then defaulting is quite cynical and it is maybe not exactly QE, but its pretty darn close.

 

[EdwardBaiamonte]

What a smug liberal ass. If true sell your house and short the stock and real estate markets!!

I do realize you're the lib fool who wants to ban international trade so we have to grow our own bananas at 50 times the cost.

Smarter even : buy my mortgage from the bank , sell it to the fed as triple A asset and then default on it.
That's QE mostly.

100% stupid and liberal. QE was part of the monetary policy that prevented another depression. Do you even know what monetary policy is. Do you know what you would have done to prevent a depression other than ban international companies like Toyota and GM!!

 

[EdwardBaiamonte]

Ed... that's mountain out a molehill. It would mean rebuilding bridges that have already begun to crumble -

total idiot liberal!! If it would mean that why does the libturd bureaucratic monopoly build bridges to no where and why did the USSR and Red China fail.

A liberal is too stupid to understand that a libturd bureaucratic monopoly is inefficient and even after $20 trillion of debt the infrastructure is still crumbling. China just switched to capitalism and instantly ended 40% of the world's poverty and yet brain dead, anti science, liberals still go with their idiotic fantasies.

 

[EdwardBaiamonte]

why not repair an infrastructure that we already know needs it and get more people working thus reducing the number of people collecting a check for watching TV

100% stupid and liberal as usual. Why not get them real jobs in real businesses where they make stuff in a competitive environment that people actually want to buy to improve their standard of living. The USSR failed because everyone had make- work government jobs..

Do you have the IQ to understand that??