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The Fiscal Cliff and how Godless Secularists cause fiscal collapse
Posted: 31 December 2012 01:37 AM   [ Ignore ]   [ # 16 ]
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Equal Opportunity Curmudgeon - 30 December 2012 05:21 PM

National Monetary Policy does not work the same as a household budget. Please.

National monetary policy doesn’t work at all!

I don’t see what household budgeting has to do with government but the rules of the game don’t magically change just because it’s the government which is doing all the spending.

Actually, not only do the rules change, but they are not even the same rules.  Please, oversimplification in the name of fearmongering is not really very helpful.

The record is very clear, as are the mathematics.

If the government spends more in good times and less in bad times, you excite the periodic nature of the economy, and you create a gigantic boom and bust cycle.

If you spend when things are bad and SAVE when things are good, you damp the boom and the bust, and keep a stable economy.

That’s what history since 1945 shows. It’s not a guess, it’s both the obvious mathematical result and the historical record.  Do the math yourself, it’s pretty easy. You’ll find that the economy works pretty well as a 4th order sampled model, with government spending as one of the driving functions.

Really. Try it. Do it yourself. Don’t take my word for it.

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Posted: 31 December 2012 07:18 PM   [ Ignore ]   [ # 17 ]
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Actually, not only do the rules change, but they are not even the same rules.

No, they really don’t.

The soap opera excuses and rationalizations may change but the blunt reality is absolute, brutally clear, and really not open to any sort of debate, and the blunt reality is this:

When the ratio of outlays exceeds income and persists in doing so in spite of endless attempts to wish it away with legislation, you are in absolutely deep doodoo. If the problem is not addressed, the result is economic collapse. Just on a vastly larger and more disasterous scale then what you would see if a household went bust.

That’s really all there is too it.

The rest is just haggling on how elaborate the route to fiscal collapse is.

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Posted: 31 December 2012 08:23 PM   [ Ignore ]   [ # 18 ]
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It’s OK for outlay to exceed income if income is growing. Of course, this too has its limits.

Warren Buffett’s recent NYTimes letter mentioned this:

Our government’s goal should be to bring in revenues of 18.5 percent of G.D.P. and spend about 21 percent of G.D.P. — levels that have been attained over extended periods in the past and can clearly be reached again. As the math makes clear, this won’t stem our budget deficits; in fact, it will continue them. But assuming even conservative projections about inflation and economic growth, this ratio of revenue to spending will keep America’s debt stable in relation to the country’s economic output.

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Posted: 31 December 2012 11:22 PM   [ Ignore ]   [ # 19 ]
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Equal Opportunity Curmudgeon - 31 December 2012 07:18 PM

Actually, not only do the rules change, but they are not even the same rules.

No, they really don’t.

The soap opera excuses and rationalizations may change but the blunt reality is absolute, brutally clear, and really not open to any sort of debate, and the blunt reality is this:

When the ratio of outlays exceeds income and persists in doing so in spite of endless attempts to wish it away with legislation, you are in absolutely deep doodoo. If the problem is not addressed, the result is economic collapse. Just on a vastly larger and more disasterous scale then what you would see if a household went bust.

That’s really all there is too it.

The rest is just haggling on how elaborate the route to fiscal collapse is.

Fortunately, all of the historical evidence reads against you.

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Posted: 31 December 2012 11:25 PM   [ Ignore ]   [ # 20 ]
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dougsmith - 31 December 2012 08:23 PM

It’s OK for outlay to exceed income if income is growing. Of course, this too has its limits.

Warren Buffett’s recent NYTimes letter mentioned this:

Our government’s goal should be to bring in revenues of 18.5 percent of G.D.P. and spend about 21 percent of G.D.P. — levels that have been attained over extended periods in the past and can clearly be reached again. As the math makes clear, this won’t stem our budget deficits; in fact, it will continue them. But assuming even conservative projections about inflation and economic growth, this ratio of revenue to spending will keep America’s debt stable in relation to the country’s economic output.

Precisely, and a very little bit of economy just when the derivitive of the boom end of the cycle starts to decrease, you can eat the prior debt, as well.

The problem, of course, is in the dire warnings, the misconceptions, and the unwillingness to behave rationally in a positive-going economy.

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Posted: 01 January 2013 06:26 PM   [ Ignore ]   [ # 21 ]
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Fortunately, all of the historical evidence reads against you.

No it doesn’t.

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Posted: 02 January 2013 02:17 AM   [ Ignore ]   [ # 22 ]
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Equal Opportunity Curmudgeon - 01 January 2013 06:26 PM

Fortunately, all of the historical evidence reads against you.

No it doesn’t.

Controversion of the last 60 years of evidence by saying “no it doesn’t” really doesn’t convince me.

You have 60 years of various policies and their effects to refute. So what’s the refutation, beyond “no it doesn’t”, which is, of course, not even an argument, but mere controversion.

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Posted: 02 January 2013 03:45 PM   [ Ignore ]   [ # 23 ]
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Controversion of the last 60 years of evidence by saying “no it doesn’t” really doesn’t convince me.

I don’t care what convinces you. All I have to do is take a look at the most recent examples. The collapse of the Soviet Union being the most obvious. They went broke, stayed broke, and fell apart. (FACT!) The successor states have been 21 years in picking up the pieces and it’s not over yet.

There’s also Greece where their problems run so deep it nearly caused the collapse of the Euro and may yet still do so. Don’t forget the South American and African states which have this happen all the time and where chronic inflation doesn’t go away.

So yes….you’re wrong. When you go in debt sooner or later, they day comes when you WILL have to pay it back. if it’s so large and unmanagable that you can’t, then you WILL have collapse and it’s demonsterable that you do.

The sorry wishful thinking you’re indulging in doesn’t change that and only serves to make matters worse.

Just start dealing with it.

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Posted: 02 January 2013 08:52 PM   [ Ignore ]   [ # 24 ]
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Equal Opportunity Curmudgeon - 02 January 2013 03:45 PM

Controversion of the last 60 years of evidence by saying “no it doesn’t” really doesn’t convince me.

I don’t care what convinces you. All I have to do is take a look at the most recent examples. The collapse of the Soviet Union being the most obvious. They went broke, stayed broke, and fell apart. (FACT!) The successor states have been 21 years in picking up the pieces and it’s not over yet.

Do you still think we’re on the gold standard or something?

The USSR had a very big problem with efficiency and the willingness to fight protracted military battles. We’re as stupid about the latter, but our productivity is enormously better than the USSR. What happened to the USSR is the result of a political ideology in a COMMUNIST society, where there was no “free market” at all, except the black market.

Raising that as the spectre of doom is purely scaremongering, and is trying to connect something that is obviously, on its face, utterly, completely factually unrelated to a free-market society, or even a moderately socialist one to a radically organized, extremely corrupt communist society wherein people were effectively rewarded both for lieing about production and producing poor product.

The status of Greece, Spain, and Italy is exactly, precisely the fault of imbicillic “austerity” measures.  When Germany reunited, it printed money to keep up the money supply. Now, of course, the EU wants Greece, Spain, and Italy, who the powers that be regard as lesser countries, to do exactly the opposite, and undergo catastrophic depression rather than use the technique that everyone knows works.

Your “proof” is nothing but offensively emtional scaremongering, your argument confuses the results of a corrupt communist society with a capitalistic society, and then goes on to blame Greece for the policies forced upon it by people who still live with a gold standard mentality.

The last 60 years is very clear on this matter, despite your attempts to confuse the facts with bombastic, counterfactual emotional rhetoric.  The sheer chutzpah of trying to compare a corrupt communist society to the USA, or trying to spin the facts exactly counter to the real problems in the EU, well, I’m sorry, but now I have to wonder about your intent.

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Posted: 02 January 2013 10:33 PM   [ Ignore ]   [ # 25 ]
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One of the podcasts that I listen to, which occasionally touches on financial matters had an interview with a financial journalist who is scheduled to have a book out some time this year which argues that the biggest threat to our economy is the financial system.  Not simply because of “too big to fail” banks, but because so much of the money in our economy circulates exclusively in financial schemes without ever passing through the hands of a corporation/individuals outside of the financial sector.  His argument is that this money would be better spent investing in businesses unrelated to the financial sector, and that until we make that shift, we can expect a tepid economy at best.

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Posted: 02 January 2013 11:02 PM   [ Ignore ]   [ # 26 ]
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Coldheart Tucker - 02 January 2013 10:33 PM

One of the podcasts that I listen to, which occasionally touches on financial matters had an interview with a financial journalist who is scheduled to have a book out some time this year which argues that the biggest threat to our economy is the financial system.  Not simply because of “too big to fail” banks, but because so much of the money in our economy circulates exclusively in financial schemes without ever passing through the hands of a corporation/individuals outside of the financial sector.  His argument is that this money would be better spent investing in businesses unrelated to the financial sector, and that until we make that shift, we can expect a tepid economy at best.

Very true. It’s the same thing as hoarding.  There is no true investment, only arbitrage.

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Posted: 03 January 2013 08:16 PM   [ Ignore ]   [ # 27 ]
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>>Do you still think we’re on the gold standard or something?<<

Irrelevant strawman.

>>Your “proof” is nothing but offensively emtional scaremongering, your argument confuses the results of a corrupt communist society with a capitalistic society, and then goes on to blame Greece for the policies forced upon it by people who still live with a gold standard mentality.<<

One: There is NO right to NOT be offended.

Two: I’ve noticed that when people put on airs of being offended and rightous indignation, it’s because somebody told a very awkward truth on them.

Three: The examples I cited are examples of fiscal collapse. The details matter very little in light of the end result, but NONE of these things would have happened to any of these countries if they were living within their means. Don’t try telling me that it’s not what it is when I’m watching all of this unfold as it happens on live international network news.

I’m not going to indulge the sort of fantasy and wishful thinking that your advocating here

Face it: Deficit living does not work. Get over it.

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Posted: 03 January 2013 09:30 PM   [ Ignore ]   [ # 28 ]
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Equal Opportunity Curmudgeon - 03 January 2013 08:16 PM

Three: The examples I cited are examples of fiscal collapse. The details matter very little in light of the end result,

Actually, the details are absoutely the most important part. If one is actually going to bother to understand what happened in any given case, as one says, “the devil is in the details”.

Your posts are very long on deliberately misleading emotional rhetoric, piled full of dishonest, unwarranted insults, and have zero, I repeat ZERO germane evidence to the discussion about fiscal collapse.

You have provided zero evidence of a germane sort, and dismissed testable, verifiable fact as “wishful thinking”.  In short, you are attempting to delude the reader. You may be deluded yourself, I don’t know and I don’t care, but you need to develop some rhetoric ethics, and do so promptly, or I will cheerfully continue to point out your relentless rhetorical misconduct.

It remains a fact just like it was the first time I said it, “National fiscal policy is not like a household budget”.  Pointing out that a corrupt, totalitarian regime collapsed under the weight of its corruption is unrelated, and attempting to use such a fact as “evidence” is nothing more than an attempt to mislead via false assertion of relevance.

I notice you won’t reply to what Germany did after reunification, which is exactly what the EU won’t let Greece, Spain, and Italy do.

As the evidence of the last great depression (the one before the one we are in now) shows perfectly well, “austerity” in a depression creates a downward spiral, destroying the money supply, the providers, and the industry. THEN, and only then, we see runaway inflation, paradoxically, but factually, as a result of stupid, many-times-proven-failure austerity policies.

That’s the facts in the historical record. All of the rhetorical misconduct in the world doesn’t change the facts.

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Posted: 04 January 2013 10:12 PM   [ Ignore ]   [ # 29 ]
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That’s the facts in the historical record. All of the rhetorical misconduct in the world doesn’t change the facts.

I didn’t give you rhetorical anything. I pointed to examples of fiscal collapse that ACTUALLY happened and this is not a debatable point. Not even remotely.

You’re playing the “I’m so offended” card doesn’t fly.

Now what part of “I’m not going to indulge the sort of fantasy and wishful thinking that your advocating here.” did you NOT understand?

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Posted: 04 January 2013 10:46 PM   [ Ignore ]   [ # 30 ]
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http://www.washingtonpost.com/blogs/wonkblog/wp/2013/01/03/an-amazing-mea-culpa-from-the-imfs-chief-economist-on-austerity/

Hhere y’go, now the IMF agrees with me too.

Live with the facts, and stop with the proof-by-assertion.

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