The proof about Keynes at long last

[EdwardBaiamonte]

Ok so lets go with ron pauls plan and cut $1 trillion from the budget in a single year.

What do you think will happen after that genius?

Who's talking about Ron Paul ????????? The issue is about understanding that we must in effect make liberalism illegal so that we are heading toward a responsible balanced budget and a growing economy.

This is a huge day for you. Now that you understand a little its your civic duty to spread the word.

 

[CrusaderFrank]

Do you understand what im saying?

Buying a treasury note has absolutely 0 effect on the amount of money a bank can lend because the treasury note is a liquid asset just as good as cash. How many more times do i have to explain this? A bank could lend against $1 million in treasuries just like it does with $1 million in cash.

You're trying to save face by limiting your vast trillion dollar error to "banks" but it's better to cut your losses and move on

When real interest rates are negative

treasuries arent the best investment, and usually arent bought as such.

Three great Mistakes:

Moving all in Texas Hold Em with 2 red aces on a 5-6-7 spades board

Splitting 8's in Blackjack when the dealer has a 10 up

Putting up a pointless chart in the hopes of salvaging the last bit of credibility you might have had

 

[EdwardBaiamonte]

Putting up a pointless chart in the hopes of salvaging the last bit of credibility you might have had

I guess the poor liberal figures the charts look sophisticated anyway, even though they are essentially irrelevant to his points. Its like selling a car by putting a beautiful woman in the ad.

 

[cbirch2]

You're trying to save face by limiting your vast trillion dollar error to "banks" but it's better to cut your losses and move on

When real interest rates are negative

treasuries arent the best investment, and usually arent bought as such.

Three great Mistakes:

Moving all in Texas Hold Em with 2 red aces on a 5-6-7 spades board

Splitting 8's in Blackjack when the dealer has a 10 up

Putting up a pointless chart in the hopes of salvaging the last bit of credibility you might have had

Dude you have no argument but you just keep claiming im wrong. So just talk all you want

Im not limit my argument to banks just to "save face", banks buy large portions of our debt. Your argument basically revolves around individuals buying treasuries through treasury direct, which is a small portion of the overall treasury market.

And the chart does matter. It says something about the incentives of the market. If interest rates on T notes were higher than they are now, youd see the market behaving like you claim. But when nominal interest rates are basically 0, why would someone looking to invest and get a return invest in a treasury? Not only does it yield basically no interest, but you give up the benefit of liquidity, you cant buy gas with a treasury. Just about the only benefit of a treasury is the slight interest, to protect against inflation, which doesnt exist with cash.

Do you see the change that happens in the market when treasury interest rates drop so low? Starting to understand basics yet?

Besides, crowding out is numerically wrong on its face. To be technical, only about 53% of the money we borrow is borrowed from domestic investors (china is only like 12% so dont even pull that out). So at the very least you can say that government borrowing is an inflow of capital.

And ur wrong more still...

Your only looking at one side of the equation. Doesnt the government pay those bondholders back? The government is constantly borrowing from investors, but at the same time its always paying back previous ones.

 

[cbirch2]

Putting up a pointless chart in the hopes of salvaging the last bit of credibility you might have had

I guess the poor liberal figures the charts look sophisticated anyway, even though they are essentially irrelevant to his points. Its like selling a car by putting a beautiful woman in the ad.

Lol the interest rate on debt is irrelevant to the discussion of borrowing....?

That truly is an idiotic statement.

 

[EdwardBaiamonte]

Putting up a pointless chart in the hopes of salvaging the last bit of credibility you might have had

I guess the poor liberal figures the charts look sophisticated anyway, even though they are essentially irrelevant to his points. Its like selling a car by putting a beautiful woman in the ad.

Lol the interest rate on debt is irrelevant to the discussion of borrowing....?

That truly is an idiotic statement.

what point is the liberal making in the discussion????

 

[Uncensored2008]

Do you understand what im saying?

Buying a treasury note has absolutely 0 effect on the amount of money a bank can lend because the treasury note is a liquid asset just as good as cash. How many more times do i have to explain this? A bank could lend against $1 million in treasuries just like it does with $1 million in cash.

When this treasury note is added to the pool of currency, with a static pool of goods and services, what happens to the existing currency?

IOW, Joe has $200 in currency. There are $50 trillion in goods and services in the market, the fed floats $6 trillion in new currency backed by TBills. What is the effect on Joe?