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Registered Apr 30, 2009
Reality's most recent comments:
- On Thu, 21 Apr 2016, 12:05am PDT
Now all problems are solved - $20 bill changing.,
There is one major problem with Tubman: helping organizing John Brown's deadly terrorist attack on Federal property.
- On Wed, 20 Apr 2016, 5:15am PDT
Bernie pays a lower tax rate than the average American,
Abe Lincoln is well known for having large debts in the White House and he turned out OK.
I wouldn't call someone causing more than 600,000 American combat deaths as "turned out ok." Compared to total population of the time, that's equivalent to 7 million deaths today! More than double the total number of people in the entire military now! That 620k military death toll from Civil War did not even count the civilian deaths caused by the war.
Lincoln being a heavy debtor may well have had a lot to do with his preference for heavy handed war mongering and government intervention: to reduce the real purchasing power of his debt. He was also behind the Greenback money printing scheme.
- On Sat, 13 Feb 2016, 7:33am PST
I'm liquidating all my stocks and going to cash,
1. Inflation would help debtors only if the subsequent inflation rate exceeds the existing inflation expectation at the time the debt is incurred. Otherwise, the expected inflation would just work into interest rate. The constant 2% theory would not work in real life, except for cooking up some accounting gains ripe for taxation; in other words detrimental to real economic growth.
2. Post-1913 recession length count is affected by an econometric artifact: it takes time for new money to work through the system and drive up prices. That causes a statistical delay in the GDP deflator, resulting in an over-statement of GDP when the government is goosing the economy. That is on top of the problem of GDP count itself counting the full nominal value of government waste. How does the recovery since 2009 feel? For most people it feels like a continuation of long recession. Started in 2008 if not 2000 (dot-com crash)
3. Declining product price does not necessarily lead to lack of investment in new industry, just witness the computer and telecom equipment industry in the past 3 decades: prices constantly dropped yet the tech industry grew rapidly. In reality, artificially low interest rate and central bank engineered boom actually would divert capital resources towards non-productive and less productive enterprises, such as low interest government loan to bail out obsolete players (say, typewriter makers, union infested carmakers and big banking conglomerate too ponderous to adjust), and the so-called "content businesses" of literature majors when it is the technology that brings the high growth.
4. The late 19th century long recession was the result of government subsidized railroads going bust. In other words, another instance of government induced boom causing bust.