Question for the Board about public finance ...

indynittany

Well-Known Member
Feb 21, 2005
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I am hearing from various analysts that the prime rate will need to get to the 4-5% range. This is what happens when you increase money by 40% without production to back that up. That much money should have been spread out over at least a decade.

How does the government finance this? It seems to me that interest payments will exceed the deficit itself. Does the government (Fed) just take all the liquidity out of the system and recreate 2008?

Otherwise, wouldn't the imbalance generate a financial collapse, i.e., hyperinflation?

I don't see how we stop a death spiral without cutting public spending when debt is this high.

Someone please explain an alternative mechanism to control inflation. We are in an unprecedented situation. The last time debt/GDP was anywhere even close to this we had marginal tax rates that are much higher than today, 70% for some.

How do you get to those tax rates without an economic implosion or "the rich" sending their capital overseas?

I see a lot of hope, speculation, and dreaming, but not any serious math or logic.

“You Will Own Nothing and Be Happy,” Klaus Schwab​

 

junior1

Well-Known Member
May 29, 2001
6,711
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I get called 3 derogatory names in one post.

I must be on the right track!

Covid or not cutting the deficit by that much in one year is deflationary.
but isn't the rest of the deficit by your definition inflationary?
 

KnightWhoSaysNit

Well-Known Member
Jul 19, 2010
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In one sentence Rumble will say that Congress allows the Treasury to add dollars to the banking system in an amount equal to the spending bill.

Yes, that is true. That is how all federal government spending occurs. Federal taxes work the opposite direction. All federal taxes simply remove dollars from the banking system.

Then he says that most of the money [in circulation] is created by private banks making loans. If you read that at face value he's essentially saying that a private bank can fabricate a balance sheet.

This is how our monetary system works. The books are not cooked. When a bank creates a loan they create a liability and an asset account on their balance sheet which match. The difference between a bank creating money and me or you doing it is that those loan assets are in dollars. So yeah, they are in fact creating dollars that are offset by liability accounts. They can't do this willy nilly of course, banks are one most highly regulated industries in country and for good reason.

The difference between bank created dollars and federal government deficit created dollars is in the liability part. If you add up all the bank created dollars and all the offsetting bank liability accounts they net to zero. The federal government deficit created dollars on the other hand belong to us without any offsetting liability. All of the net dollars that exist in the banking system are result of the cumulative amounts of federal government deficits. Those dollars belong to us the public free and clear.

Then he does even more deception by injecting population growth, as if adding a person changes the money supply problem. Same thing with years. He compares 1950 with today, as if it is years that change the money supply and not the actual mechanism, which is Congress and the Federal Reserve.

The money supply is not that static. It's a dynamic supply that changes with how economy is doing via bank lending activity.

The 1950 comparison was about the demand side not the supply. The economy of 2022 could not operate with the amount of dollars that were in the banking system in 1950.

You like to divert to the intricacies of our monetary system, and muddy the money supply issue, when a simple question is being asked that really amounts to this: Who pays?

Do you think it is fair that holders of cash, bonds, and pensions -- people in early retirement with decades to go, should be defrauded by today's excessive spending? (40% M2 increase with the economy shut down.). This, while asset prices -- home values and stocks -- rise from pre-pandemic levels, creating a bubble. So the most conservative, secure asset takes the hit and finances everything else. Essentially it becomes a transfer payment.

Do you think it is fair to have the government renege on its 2% inflation mandate when there was no need? A pandemic with business shutdowns should have been overall deflationary. Instead, some got rich taking advantage of the bubble that should never have been created.

Do you think that is fair? Good policy?

This is your empathetic, caring, benevolent Democratic Party. They even held up Powell's confirmation until he had financed their spending whims. They created inflation -- a transfer payment away from people that cannot negotiate a pay raise.
 

Catch50

Well-Known Member
Feb 5, 2003
36,260
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You like to divert to the intricacies of our monetary system, and muddy the money supply issue, when a simple question is being asked that really amounts to this: Who pays?

Do you think it is fair that holders of cash, bonds, and pensions -- people in early retirement with decades to go, should be defrauded by today's excessive spending? (40% M2 increase with the economy shut down.). This, while asset prices -- home values and stocks -- rise from pre-pandemic levels, creating a bubble. So the most conservative, secure asset takes the hit and finances everything else. Essentially it becomes a transfer payment.

Do you think it is fair to have the government renege on its 2% inflation mandate when there was no need? A pandemic with business shutdowns should have been overall deflationary. Instead, some got rich taking advantage of the bubble that should never have been created.

Do you think that is fair? Good policy?

This is your empathetic, caring, benevolent Democratic Party. They even held up Powell's confirmation until he had financed their spending whims. They created inflation -- a transfer payment away from people that cannot negotiate a pay raise.
Are people in early retirement no less defrauded when Republicans deficit spend on defense? It's an easy question to answer.
 

Catch50

Well-Known Member
Feb 5, 2003
36,260
2,302
1
You like to divert to the intricacies of our monetary system, and muddy the money supply issue, when a simple question is being asked that really amounts to this: Who pays?

Do you think it is fair that holders of cash, bonds, and pensions -- people in early retirement with decades to go, should be defrauded by today's excessive spending? (40% M2 increase with the economy shut down.). This, while asset prices -- home values and stocks -- rise from pre-pandemic levels, creating a bubble. So the most conservative, secure asset takes the hit and finances everything else. Essentially it becomes a transfer payment.

Do you think it is fair to have the government renege on its 2% inflation mandate when there was no need? A pandemic with business shutdowns should have been overall deflationary. Instead, some got rich taking advantage of the bubble that should never have been created.

Do you think that is fair? Good policy?

This is your empathetic, caring, benevolent Democratic Party. They even held up Powell's confirmation until he had financed their spending whims. They created inflation -- a transfer payment away from people that cannot negotiate a pay raise.
How is increases in asset prices the fault of policy? It is by far the result of supply and demand. People would prefer to own homes. Part of your problem is you imagine things are more complicated than they really are.
 

KnightWhoSaysNit

Well-Known Member
Jul 19, 2010
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How is increases in asset prices the fault of policy? It is by far the result of supply and demand. People would prefer to own homes. Part of your problem is you imagine things are more complicated than they really are.

C'mon Catch. Fed policy held interest rates down far below what a free market would have dictated. All of that cash in banks funded a bid-bubble. Heck even hedge funds were buying property at artificially driven lending rates. Homes were being bought up just to rent them.

Congress did the spending. The Treasury issues the bonds/cash. The Fed buys trillions in bonds back and cash gets dumped into the economy through the banking system. Look at where interest rates are right now compared to pre-pandemic. That should tell you something right there.

Leveraging, corruption of risk, is exactly what created the 2008 crisis. We will have stagflation, maybe even a crash. Wall Street traders will walk away rich from the bubble and your 401K will be in the trash.

None of this probably matters to you. My guess is that your retirement, given that you work for the government, is inflation-corrected. So I am paying you in two ways, more now and more later. No wonder you are a Dem. You are a receiver of private money with very little performance-based risk. Heck even you called your boss stupid and some of your peers lazy. This is why conservatives think government is inefficient and costly. Because it is.
 

KnightWhoSaysNit

Well-Known Member
Jul 19, 2010
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Are people in early retirement no less defrauded when Republicans deficit spend on defense? It's an easy question to answer.

You should know by now that I am against both deficit spending and excessive defense spending. I am a Republican now because the Democratic Party at this point looks like a communist party and they need to be stopped. Dems claim that republicans are a threat to our democracy but they have it completely backwards. They behave like authoritarian socialists. They've created anarchy all over the country and at our borders.

This should be clear as day to anyone not blinded by the source of their personal paycheck.
 

KnightWhoSaysNit

Well-Known Member
Jul 19, 2010
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@Catch50

I will concede that some who work for the government, such as yourself, work very hard. I certainly did, and had to survive many difficult periods -- layoffs. But the point is that, like people in unions, it's much harder to get rid of the unproductive in government. This extends to defense spending and even entitlements. Very inefficient use of money. Those public systems get abused all the time. It's a lot like our school systems. Private schools are better. Why? Because there is more accountability.
 

Catch50

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Feb 5, 2003
36,260
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@Catch50

I will concede that some who work for the government, such as yourself, work very hard. I certainly did, and had to survive many difficult periods -- layoffs. But the point is that, like people in unions, it's much harder to get rid of the unproductive in government. This extends to defense spending and even entitlements. Very inefficient use of money. Those public systems get abused all the time. It's a lot like our school systems. Private schools are better. Why? Because there is more accountability.
Not everyone can afford private schools.
 

Catch50

Well-Known Member
Feb 5, 2003
36,260
2,302
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You should know by now that I am against both deficit spending and excessive defense spending. I am a Republican now because the Democratic Party at this point looks like a communist party and they need to be stopped. Dems claim that republicans are a threat to our democracy but they have it completely backwards. They behave like authoritarian socialists. They've created anarchy all over the country and at our borders.

This should be clear as day to anyone not blinded by the source of their personal paycheck.
The most recent anarchy I have seen is Jan ^. And the deniers of such anarchy. And the veiled threats from Trump.
 

Catch50

Well-Known Member
Feb 5, 2003
36,260
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C'mon Catch. Fed policy held interest rates down far below what a free market would have dictated. All of that cash in banks funded a bid-bubble. Heck even hedge funds were buying property at artificially driven lending rates. Homes were being bought up just to rent them.

Congress did the spending. The Treasury issues the bonds/cash. The Fed buys trillions in bonds back and cash gets dumped into the economy through the banking system. Look at where interest rates are right now compared to pre-pandemic. That should tell you something right there.

Leveraging, corruption of risk, is exactly what created the 2008 crisis. We will have stagflation, maybe even a crash. Wall Street traders will walk away rich from the bubble and your 401K will be in the trash.

None of this probably matters to you. My guess is that your retirement, given that you work for the government, is inflation-corrected. So I am paying you in two ways, more now and more later. No wonder you are a Dem. You are a receiver of private money with very little performance-based risk. Heck even you called your boss stupid and some of your peers lazy. This is why conservatives think government is inefficient and costly. Because it is.
It may or may not be accurate to say money is dumped into the banking system. For people to take advantage of low interest rates, they have to have jobs or a large amount of savings. And most people start saving through work. And high employment (jobs) are the most important measure of the economy. I know you will disagree with that last statement.

Jobs are crucial. Usually, prices can self correct for inflation. But right now, although inflation is high, people are still consuming much. That tells me enough people are consuming at these prices to keep prices high.
 

KnightWhoSaysNit

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Jul 19, 2010
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Not everyone can afford private schools.

They could if you just diverted all the tax money dedicated to schools directly back in the form of vouchers. The parents can then select either the public school or the private school. The cost might even go down. Real education, and discipline, would go up. No more worthless union to block progress. No more Department of Education to suck resources.
 

KnightWhoSaysNit

Well-Known Member
Jul 19, 2010
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The most recent anarchy I have seen is Jan ^. And the deniers of such anarchy. And the veiled threats from Trump.

Obviously you have not wandered around in some of our cities, or spent any time in a border town. You would need to carry.

Your reality seems really skewed by the likes of biased media, like MSNBC, who won't even touch anything negative on Democrats.
 

Catch50

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Feb 5, 2003
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They could if you just diverted all the tax money dedicated to schools directly back in the form of vouchers. The parents can then select either the public school or the private school. The cost might even go down. Real education, and discipline, would go up. No more worthless union to block progress. No more Department of Education to suck resources.
I will wait to hear how union block progress in education. Note I am not a strong supporter of union. But teachers get blamed for everything by the parents of the kids doing no or little work. Teachers should be able to concentrate on subject matter. Teachers are not the one talking on cell phones when the teacher is teaching. Teachers are not the ones destroying rest rooms. I hear these stories all the time from my teacher wife.
 

Catch50

Well-Known Member
Feb 5, 2003
36,260
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Obviously you have not wandered around in some of our cities, or spent any time in a border town. You would need to carry.

Your reality seems really skewed by the likes of biased media, like MSNBC, who won't even touch anything negative on Democrats.
You're totally wrong about me and the Democrats. Do you see me getting many likes from the Dems on this board. That's ok.

I'm well aware of the problems in the inner cities and border towns. The answer is more, tougher policing/sentencing (for provable crimes) but the problem still does not go away without better economic growth in these places. And no tax increase is needed.
 

KnightWhoSaysNit

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Jul 19, 2010
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It may or may not be accurate to say money is dumped into the banking system. For people to take advantage of low interest rates, they have to have jobs or a large amount of savings. And most people start saving through work. And high employment (jobs) are the most important measure of the economy. I know you will disagree with that last statement.

Jobs are crucial. Usually, prices can self correct for inflation. But right now, although inflation is high, people are still consuming much. That tells me enough people are consuming at these prices to keep prices high.

Prices are high on goods because the supply chain was mucked up by the holes created through easy money. Some of it was cause by ridiculous government mandates. You should know this. People that produce things or deliver things quit, retired, or moved on.

We have trouble with simple mail delivery where we live. I can find no one to repair our house. It will be expensive now because government created the holes in the supply of labor. It created inflation, which is destructive.

The value of a job (what a person gets paid) should be totally based on what someone is willing to pay for the good or service provided by the employee. This produces the greatest wealth. There are only a few things that are really required to be worked through government.

Your labor, at any level, is a market commodity like anything else. It's a cost to business. Your worth is what people are willing to pay you. If you ignore this principle then you have socialism. If government mandates pricing then you have communism. It is what it is.

Sadly, not every job can provide a living wage. The worker in many cases must migrate. In a very real way I did this myself. The company essentially ordered me to work where the work was needed. I could go, quit, or destroy my future earnings with the company by refusing. Early in my career I rented a maid's quarters. The area was expensive. It was my choice, and my employers choice.

No business should be forced to pay or retain an employee that they do not want, or an employee that does not provide value commensurate with services rendered. It's a market.

Companies retain good employees, through retirement, because it's good for business. Good employees come behind them as they finish their careers.

I bet you've spent very little time in a private company. Certainly not decades like most of us.
 

KnightWhoSaysNit

Well-Known Member
Jul 19, 2010
9,240
9,765
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I will wait to hear how union block progress in education. Note I am not a strong supporter of union. But teachers get blamed for everything by the parents of the kids doing no or little work. Teachers should be able to concentrate on subject matter. Teachers are not the one talking on cell phones when the teacher is teaching. Teachers are not the ones destroying rest rooms. I hear these stories all the time from my teacher wife.

That's right. Discipline is a problem. Which is why private schools give teachers more power. Public schools that constrain teachers do not provide a good environment for learning.

In a private school it's easier to manage behavior. A kid doesn't behave and they are gone. No diploma.

Diplomas should mean something. Grade levels should indicate something.
 

KnightWhoSaysNit

Well-Known Member
Jul 19, 2010
9,240
9,765
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You're totally wrong about me and the Democrats. Do you see me getting many likes from the Dems on this board. That's ok.

I'm well aware of the problems in the inner cities and border towns. The answer is more, tougher policing/sentencing (for provable crimes) but the problem still does not go away without better economic growth in these places. And no tax increase is needed.

OK, but you vote straight Dem. That means you are putting some very destructive people in power. They don't align anywhere close to your values.

So you are making a big, dangerous, destructive choice to get infrastructure spending.

Look at everything in this country since Biden's inauguration and Dem power in Washington. It's all bad. Everything. It could be argued that even employment isn't good. Unemployment numbers are low but the number of workers is also low, or at least not growing in concert with the money supply.

That is the problem. The economy has been thrown for a loop. Worker/business relationships are under pressure. There is the Quiet Quit. I'm not sure if we can come out of it.

Voting straight Dem is very dangerous. Policies have been dragged to the very far left. Moderates have caved to whatever the Party's most aggressive representatives want. Canceling student debt should tell you how irrational this is. That's not even legal without legislation. That's a trillion dollar decree that defrauds all who paid their bills and sacrificed instead of borrowing. Look at what they've done to energy. They're drawing down the strategic oil reserve over politics.

It is you who don't understand what you are truly installing when you vote Dem.

It's characteristic of Dems to have one issue that is critical to them personally, then they go with the full blown destructive, big government plan to cover every constituent gripe. In the end you have ... a socialist society and very low living standards.
 

rumble_lion

Well-Known Member
Aug 7, 2011
23,133
5,647
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You like to divert to the intricacies of our monetary system, and muddy the money supply issue, when a simple question is being asked that really amounts to this: Who pays?

Do you think it is fair that holders of cash, bonds, and pensions -- people in early retirement with decades to go, should be defrauded by today's excessive spending? (40% M2 increase with the economy shut down.). This, while asset prices -- home values and stocks -- rise from pre-pandemic levels, creating a bubble. So the most conservative, secure asset takes the hit and finances everything else. Essentially it becomes a transfer payment.

Do you think it is fair to have the government renege on its 2% inflation mandate when there was no need? A pandemic with business shutdowns should have been overall deflationary. Instead, some got rich taking advantage of the bubble that should never have been created.

Do you think that is fair? Good policy?

This is your empathetic, caring, benevolent Democratic Party. They even held up Powell's confirmation until he had financed their spending whims. They created inflation -- a transfer payment away from people that cannot negotiate a pay raise.

Do you think it is fair to have the government renege on its 2% inflation mandate when there was no need? A pandemic with business shutdowns should have been overall deflationary.

It's a dual mandate, the other part you forgot about is full employment. It's not a surprise that no ever talks about the employment part of the mandate because the fed certainly doesn't mind it when they create a recession and toss a few million people from their jobs.

Do you think we have inflation due to people buying so much stuff that companies can't keep up with demand? Or are companies having issue producing stuff because covid shutdowns have totally screwed up the intricate global supply chains they spent decades setting up?

If it's the latter then should we removing spending power from people so that the demand for products drops below even the feeble amount that can be produced now? If we were to do that would it help companies fix all the supply chain problems? It would not right?

How about car sales in the US? Here are the total sales number for the last few years in millions:

2017 17.1
2018 17.2
2019 16.9
2020 14.4
2021 14.9

Is the problem that a demand of 14.9 million cars in one year is just too much? Well no, just a few years ago we were selling over 17 million cars a year. Clearly we have the capacity to produce at least 17 million cars a year because we were just recently doing that. Now if demand was 20 million cars a year you could say well gosh there is just too demand for cars and the car companies have to raise prices because they just can't expand production fast enough. But that's not what is happening is it? We are already at recession level car sales per year.

What do you want to do? Do you want to have less spending on cars so that demand falls to 10 million per year? Is that going to fix everything?
 

Catch50

Well-Known Member
Feb 5, 2003
36,260
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OK, but you vote straight Dem. That means you are putting some very destructive people in power. They don't align anywhere close to your values.

So you are making a big, dangerous, destructive choice to get infrastructure spending.

Look at everything in this country since Biden's inauguration and Dem power in Washington. It's all bad. Everything. It could be argued that even employment isn't good. Unemployment numbers are low but the number of workers is also low, or at least not growing in concert with the money supply.

That is the problem. The economy has been thrown for a loop. Worker/business relationships are under pressure. There is the Quiet Quit. I'm not sure if we can come out of it.

Voting straight Dem is very dangerous. Policies have been dragged to the very far left. Moderates have caved to whatever the Party's most aggressive representatives want. Canceling student debt should tell you how irrational this is. That's not even legal without legislation. That's a trillion dollar decree that defrauds all who paid their bills and sacrificed instead of borrowing. Look at what they've done to energy. They're drawing down the strategic oil reserve over politics.

It is you who don't understand what you are truly installing when you vote Dem.

It's characteristic of Dems to have one issue that is critical to them personally, then they go with the full blown destructive, big government plan to cover every constituent gripe. In the end you have ... a socialist society and very low living standards.
I agree with you on the student debt mistake.
I agree with R's on the green energy/ EV mistakes.
I agree with R's that Obamacare is a failure.

But R's do nothing. R's have little to no empathy for less better off. Even those who work hard. R's think that our current insurance-based healthcare system makes sense with little recognition of the built-in waste. And I know Republicans are not willing to invest in more law/drug enforcement even with correct sentencing.
 

Catch50

Well-Known Member
Feb 5, 2003
36,260
2,302
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That's right. Discipline is a problem. Which is why private schools give teachers more power. Public schools that constrain teachers do not provide a good environment for learning.

In a private school it's easier to manage behavior. A kid doesn't behave and they are gone. No diploma.

Diplomas should mean something. Grade levels should indicate something.
You should not have to tell anyone that diplomas should mean something.
I have always said that public schools need to get the troublemakers and disruptors out of the schools. I an always met with Republican silence.

I could have replied better about your voucher solution. Private schools are considerably more expensive than public schools. Even with vouchers, more expensive than what many parents can afford. Even for one child.
My parents had four boys in the public school for six years. My father was a fireman so how could he have possibly paid for private schools even with the vouchers? Even with my mother who worked very hard.
 

Catch50

Well-Known Member
Feb 5, 2003
36,260
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Prices are high on goods because the supply chain was mucked up by the holes created through easy money. Some of it was cause by ridiculous government mandates. You should know this. People that produce things or deliver things quit, retired, or moved on.

We have trouble with simple mail delivery where we live. I can find no one to repair our house. It will be expensive now because government created the holes in the supply of labor. It created inflation, which is destructive.

The value of a job (what a person gets paid) should be totally based on what someone is willing to pay for the good or service provided by the employee. This produces the greatest wealth. There are only a few things that are really required to be worked through government.

Your labor, at any level, is a market commodity like anything else. It's a cost to business. Your worth is what people are willing to pay you. If you ignore this principle then you have socialism. If government mandates pricing then you have communism. It is what it is.

Sadly, not every job can provide a living wage. The worker in many cases must migrate. In a very real way I did this myself. The company essentially ordered me to work where the work was needed. I could go, quit, or destroy my future earnings with the company by refusing. Early in my career I rented a maid's quarters. The area was expensive. It was my choice, and my employers choice.

No business should be forced to pay or retain an employee that they do not want, or an employee that does not provide value commensurate with services rendered. It's a market.

Companies retain good employees, through retirement, because it's good for business. Good employees come behind them as they finish their careers.

I bet you've spent very little time in a private company. Certainly not decades like most of us.
Over twenty years including a fast food restaurants while in high school and early college years. I worked about fifteen years in electronics manufacturing including a few defense contractors.

Please for your own sake, get it out of your head that anyone intentionally creates inflation or create holes in the labor supply. I don't where you live but we have no problem with mail delivery or at least simple repairs.

You don't have to explain to me that labor is worth what people are willing to pay. You do have explain why you think you need to mention it. ???

Did you see that I did respond to my accomplishments in response to my questioning if you could program?
 

KnightWhoSaysNit

Well-Known Member
Jul 19, 2010
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Over twenty years including a fast food restaurants while in high school and early college years. I worked about fifteen years in electronics manufacturing including a few defense contractors.

Please for your own sake, get it out of your head that anyone intentionally creates inflation or create holes in the labor supply. I don't where you live but we have no problem with mail delivery or at least simple repairs.

Did I say they created holes intentionally? Well, maybe it was intentional. They forced vaccination in some cases or you were fired. As for the indirect holes, that's just stupid and bad policy. Getting the money supply out of sync with production. No one should be BETTER OFF as a result of a pandemic, or have the incentive to return to work removed, yet this happened.

You don't have to explain to me that labor is worth what people are willing to pay. You do have explain why you think you need to mention it. ???

Because you repeat over and over again that government can create good jobs. Well that's true to an extent, but it can't be a solution to an overall national living standard or inflation problem. Those good jobs have to be financed by taking something away from the sector that pays for those jobs.

Government generally doesn't mine, farm, or manufacture anything. It redistributes. Per dollar its impact on GDP has got to be less, largely because we (unfortunately) have a consumption-based economy. For products and services, consumers should be allowed to make the choice that drives distribution. People don't want it, it doesn't get made.

Did you see that I did respond to my accomplishments in response to my questioning if you could program?

Why would I respond to your accomplishments? Did you respond to mine?

What purpose was served by diverting a thread to one's programming skills?

That said, if I were you, I might be a little embarrassed at accusing me of being unskilled when in fact I have rare skills.
 

Catch50

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Feb 5, 2003
36,260
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Did I say they created holes intentionally? Well, maybe it was intentional. They forced vaccination in some cases or you were fired. As for the indirect holes, that's just stupid and bad policy. Getting the money supply out of sync with production. No one should be BETTER OFF as a result of a pandemic, or have the incentive to return to work removed, yet this happened.



Because you repeat over and over again that government can create good jobs. Well that's true to an extent, but it can't be a solution to an overall national living standard or inflation problem. Those good jobs have to be financed by taking something away from the sector that pays for those jobs.

Government generally doesn't mine, farm, or manufacture anything. It redistributes. Per dollar its impact on GDP has got to be less, largely because we (unfortunately) have a consumption-based economy. For products and services, consumers should be allowed to make the choice that drives distribution. People don't want it, it doesn't get made.



Why would I respond to your accomplishments? Did you respond to mine?

What purpose was served by diverting a thread to one's programming skills?

That said, if I were you, I might be a little embarrassed at accusing me of being unskilled when in fact I have rare skills.
I'm not embarrassed for asking. I have asked the same question of others. When I question one's critical thinking skills. You have made plenty of snide remarks to me. And you often are close complaining how poor you are. For a Chem E?

As for the top of your post you surely can't compare the importance of a road you USE to a consumer item.
 

2lion70

Well-Known Member
Gold Member
Jul 1, 2004
17,325
6,072
1
There is no serious proposal that I have seen for reducing the debt, or the annual deficits. Our leaders seem to be ok with a $31 trillion and increasing national debt.

You could try opening your eyes maybe?

WASHINGTON, May 25 (Reuters) - The U.S. budget deficit will shrink dramatically to $1.036 trillion for fiscal 2022 from $2.775 trillion last year as a strong recovery prompts a surge in revenues and lower outlays, but slowing growth will start to reverse the trend, the Congressional Budget Office said on Wednesday.​
Releasing new economic and baseline budget forecasts, the CBO said its now expects the fiscal 2022 deficit to be $118 billion lower than an estimate made last July. The government's fiscal year starts Oct. 1 and runs through Sept. 30.​
Increase revenue leads to decrease in deficit
Decrease demand leads to decrease in inflation

Current inflation is a function of demand greater than supply. Supply constrained by distribution problems worldwide

Government spending is not a major source of inflation or deficits (tax cuts increase deficits).
 

fairfaxlion2

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Oct 12, 2014
8,803
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How is increases in asset prices the fault of policy? It is by far the result of supply and demand. People would prefer to own homes. Part of your problem is you imagine things are more complicated than they really are.
except when the reason asset prices went up is because the money became worthless

still a supply and demand result, but not the one you are thinking of
 
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Catch50

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except when the reason asset prices went up is because the money became worthless

still a supply and demand result, but not the one you are thinking of
The money is not worthless.

Republicans have not presented any proposals to keep inflation, unemployment and debt all low as possible at the same time.
 
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PSUEngineer89

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The money is not worthless.

Republicans have not presented any proposals to keep inflation, unemployment and debt all low as possible at the same time.
We did.

It was perfect for three years.

Then Fauci and other horrible people took over.

Its been bad now for 2.5 years.

Your fault.
 
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pioneerlion83

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SouthernMD, by way of NJ and PSU
How does the government finance this? It seems to me that interest payments will exceed the deficit itself.

The federal government doesn't "finance" anything. when Congress votes a spending bill into law the dollars are simply created and spent by adjusting the dollar amounts in bank accounts. If the federal government spends more in year than it receives in taxes it issues treasuries for that amount. The treasuries simply shift dollar amounts from "checking" to "savings" accounts at the fed that pay interest. When the interest is paid or the treasury bill matures the dollars are simply shifted from the "tbill" account back to the "checking" account.
+100
MAGA and know-Nothing Idiots on this board want their 1930’s back with a return to the gold standard. 🤦‍♂️
And then talking about “China’s plan…” as if the Chinese will go to a gold standard - NOT!
Notes to @KnightWhoSaysNit : 1) all countries float their currency for monetary policy, and fund their government fiscally with tax dollars + debt; 2) the USA ALWAYS PAYS IT’S CREDITORS which is why we ARE THE WORLD’s RESERVE CURRENCY (and running the IMF, World Bank, and the WTO helps too). Being the world’s banker, like it’s policeman, has its advantages…
Absolute ****ing moronic OP once again…
 
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pioneerlion83

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We did.

It was perfect for three years.

Then Fauci and other horrible people took over.

Its been bad now for 2.5 years.

Your fault.
It wasn’t. In fact, far from it.

The Orange Man and his corrupt, incompetent, grifting administration were the horrible people.

Biden’s been fixing what Trump and COVID broke.

You’re stupid. I have an idea for you, go check out real estate in Greenland before the sea rise occurs…
 

fairfaxlion2

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The money is not worthless.

Republicans have not presented any proposals to keep inflation, unemployment and debt all low as possible at the same time.
It was hyperbole, obviously. If it was completely worthless it could not be used.

But our money has been devalued, there is zero question about that. When asset prices go up because money is becoming less valuable, that's the supply of money affecting the price level. That's what's happening now, and I would argue has been happening for a long time.

There is not one party to blame here, as you can draw a straight line back through every Fed chair since Greenspan retired, and they are all to blame for this mess
 

PSUEngineer89

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It wasn’t. In fact, far from it.

The Orange Man and his corrupt, incompetent, grifting administration were the horrible people.

Biden’s been fixing what Trump and COVID broke.

You’re stupid. I have an idea for you, go check out real estate in Greenland before the sea rise occurs…
You can’t even understand this, let alone do it.

Ive got at least 20 IQ points on you. At least.

Cletus, here are sample


Cletus, I went back and reworked it from scratch.

The formula for probability of being immune is as follows: P(natural) + P(sick&recov) + P(vac) - P(nat + sr) - P(nat + vac) - P(sr + vac) + P(nat + sr + vac).

That formula simplifies because NO ONE can have natural immunity AND get sick and recover. Therefore P(nat + sr) = 0, and P(nat + sr + vac) =0.

So, P(immune) = P(natural) + P(sick&recov) + P(vac) - P(nat + vac) - P(sr + vac).

And since the probability of an individual getting vaccinated is not influenced by natural immunity (how would he know?), then P(nat + vac) = P(nat)*P(vac).

However, many people who got sick know they have natural immunity, and so they decline to get the shot, so P(sr + vac) is not equal to P(nat)*P(vac). Let's agree for the sake of argument that this number is 0.75*P(nat)*P(vac), since many people who we will include in the "sick and recover" category won't know they were even sick, thus.....a stronger factor.

So, with that said, and using your figures, I think:

P(natural) = 0.2, P(s&r) = 100m/320m = 0.34, P(vac) = 0.52*.85%effec = .44, we then get:

P(immune) = 0.20 + 0.34 + 0.44 - (0.20*0.44) - (0.75*0.34*0.44) = 0.78.

That's herd immunity, very little question about it. But I must say, I think two numbers are high.

I don't think 20% of the people have natural immunity (even if they have some immunity where the infection isn't so bad for them, they can still spread it, and thus for herd immunity numbers, they shouldn't count). So, maybe 5-10% have natural immunity is a better number.

Then, 52% is too high also, because even though they get no harm from it, kids still count for spreading the virus. So, I think 52% should be 41% or so.....0.85*0.41 give P(vacc) = 0.350.

If I go with those numbers, we have P(immune) = 0.075 + 0.34 + 0.35 -(0.075*0.35) - (0.75*.075*0.35) = 0.72%, which is still very close to herd immunity.

Either way, one more month to go and it's all over....
 

Catch50

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It was hyperbole, obviously. If it was completely worthless it could not be used.

But our money has been devalued, there is zero question about that. When asset prices go up because money is becoming less valuable, that's the supply of money affecting the price level. That's what's happening now, and I would argue has been happening for a long time.

There is not one party to blame here, as you can draw a straight line back through every Fed chair since Greenspan retired, and they are all to blame for this mess
I believe that the FED mostly gets it right, most of the time. In my adulthood, inflation has never been a problem except when oil prices are high.
 
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fairfaxlion2

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I believe that the FED mostly gets it right, most of the time. In my adulthood, inflation has never been a problem except when oil prices are high.
We will have to agree to disagree on that. The fed got it right until Bernanke came in and imposed his graduate school thesis on the entire economy. This actually happened. I don't think history will look back kindly on 10+ years of essentially zero interest rates. This is just the beginning of the aftermath
 

Catch50

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We will have to agree to disagree on that. The fed got it right until Bernanke came in and imposed his graduate school thesis on the entire economy. This actually happened. I don't think history will look back kindly on 10+ years of essentially zero interest rates. This is just the beginning of the aftermath
10 years? Where was the inflation?
 

fairfaxlion2

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10 years? Where was the inflation?
it's happening now. If you weren't following the moves all along, it's not possible to go over it all here. But it suffices to say that many people thought the policies in response to the financial crisis represented the Fed going into major experimental mode. The rates were kept far too low, for far too long. it is unbelievable, really, that they kept the plates spinning as long as they did. But now they have no good way out. The downturn hasn't really even gotten to the 2nd inning yet