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  • On 31 Jan 2015 in Alexis Tsipras "Open Letter" to German Citizens Regarding Extend-and-Pretend, thunderlips11 said:

    libero says

    Do they seriously want to compare the devastated Germany after WW2 with its destroyed infrastructure, millions of refugees and starving population to modern day Greece which has been enjoying a western lifestyle for decades?

    Half the debt was cancelled in 1953 - that was 8 years after the surrender. West Germany also received major stimulus in outright grants, the stationing of countless UK and American troops spending their pay, and delivery of aid in the form of food, goods and tools direct from the USA.

    Unlike Greece, Germany was a belligerent. Greece has fought the Nazis and stayed a Western Ally since the moment Italy attempted to invade the country. Their reward for fighting the Nazis and Italians tooth and nail the whole war was to have Churchill ram the same Nazi Collaborators and the old King down their throats. And sponsor several military coups. Why should loyal Greece be treated worse than a former two-time belligerent?

    And the damage to German industry was grossly overstated. Again, production increased every month of the war until just before the very end when raw material shortages and interdiction and invasion finally took their toll. Precision bombing didn't work in WW2 either.

  • On 31 Jan 2015 in New Greek government already making good on its anti-austerity promises, thunderlips11 said:

    indigenous says

    thunderlips11 says

    productivity would have to be jump started by demand, and most producers are going to jump start production based on increasing domestic demand.

    Ass backwards

    Right, in Austrian land, entrepreneurs and investors usually invest in new firms that produce goods and services for which there is no existing demand.

  • On 31 Jan 2015 in New Greek government already making good on its anti-austerity promises, thunderlips11 said:

    Final comment for now: In 2007, Spain's Debt to GDP was a low 34%. Lower than the US, lower than most European Countries, including Germany.

    Spain

    http://www.economicshelp.org/blog/5525/economics/spanish-economic-crisis-summary/

    In Spain's case at least, The Financial Crisis caused the Debt, not the debt the Financial Crisis.

    Germany

  • On 31 Jan 2015 in New Greek government already making good on its anti-austerity promises, thunderlips11 said:

    Heraclitusstudent says

    What you really need is less debt. You need rebalancing between deficit countries and surplus countries. And this means cutting consumption and increasing productivity in southern europe.

    When you get rid of debt, you also get reduce the money supply. Productivity is hard to sustain if : Somebody makes it better/cheaper than you, they're using the same currency, and that currency is strong - and you have reduced domestic demand due to reduced consumption.

    The connection between lower consumption and increased productivity would be difficult to establish, since productivity would have to be jump started by demand, and most producers are going to jump start production based on increasing domestic demand.

    Bottom line if you are going to claim austerity is depriving the world economy from demand, you can't apply this argument to Greece or France. This is an argument that should be applied to the countries that are actually saving.

    Heraclitusstudent says

    Bottom line if you are going to claim austerity is depriving the world economy from demand, you can't apply this argument to Greece or France. This is an argument that should be applied to the countries that are actually saving.

    As for Austerity in Europe, the Economist, the Socialist Worker of Neoliberalism, ran this piece:
    http://www.economist.com/blogs/freeexchange/2012/05/austerity

    As for the "Austerian" Economists, with Reinhard and Rogoff's book leading the charge, their methodology and mistakes were summed up well in this blog:

    Reinhart and Rogoff, in case you are wondering, are two economists who wrote a very famous paper purporting to demonstrate that high public debt to GDP ratio leads to negative economic growth. This paper was then cited by Paul Ryan et al. as justification for shredding what remains of our country’s social safety net.

    But SHOCKER!, the paper was wrong! As a UMass grad student recently discovered, Reinhart and Rogoff not only based their conclusions off selectively chosen data, they made a serious coding error in the Excel spreadsheet they were working with.

    It’s cool though. They have written a petulant Op Ed in the Times basically explaining why none of us should WORRY about the data and the methodology they used and the Excel spreadsheet — it’s totally FINE and the original premise of their paper (which purported to demonstrate a causal relationship between high deficits and slow growth) remains sound and the best way to get out of our current economic crisis is still austerity, austerity, austerity!

    Well, there’s the thing about that “small actual difference” between the critics’ paper and their paper: THEIR paper shows that high deficits lead to a negative growth rate of 0.1%; the critics’ paper shows that the same high deficits (90% ratio of public debt to GDP) are correlated with POSITIVE growth of 2.2%.

    But yeah, it’s a small difference, in the grand scheme of things. For example, right now we are making -.1% interest on our checking account, when you factor in all the fees and everything but this is a “small actual difference” from the roughly 2.2% interest we made on our checking account during the heady days before the 2008 crash. Small difference. Potato, potahto.

    Read more at http://wonkette.com/513931/famous-austerity-economists-just-because-our-data-is-no-longer-operative-doesnt-mean-we-were-wrong#4SkTyesYgx39aCKI.99

    The critic's blog on Oxford University Press' site, talking about their now fully peer reviewed criticism of Reinhardt and Rogoff's errors and methodology. Which the two Austerians attempt to dismiss their serious cherry-picking and calculation errors as a mere "kerfluffle"
    http://blog.oup.com/2014/01/public-debt-gdp-growth-austerity-why-reinhart-and-rogoff-are-wrong/

  • On 31 Jan 2015 in New Greek government already making good on its anti-austerity promises, thunderlips11 said:

    Heraclitusstudent says

    Bottom line if you are going to claim austerity is depriving the world economy from demand, you can't apply this argument to Greece or France. This is an argument that should be applied to the countries that are actually saving.

    I think we're using different versions of Austerity here. Austerity has little directly to do with increasing savings, but rather cutting expenditures independent of whether it results in savings or not:

    In economics, austerity describes policies used by governments to reduce budget deficits during adverse economic conditions. These policies may include spending cuts, tax increases, or a mixture of the two.[1][2][3] Austerity policies may be attempts to demonstrate governments' fiscal discipline to their creditors and credit rating agencies by bringing revenues closer to expenditures; they may also be politically or ideologically driven.


    http://en.wikipedia.org/wiki/Austerity

    Austerity involves policies to reduce government spending and or higher taxes in order to try and reduce government budget deficits.


    http://www.economicshelp.org/blog/6254/economics/what-is-austerity/

    A state of reduced spending and increased frugality in the financial sector. Austerity measures generally refer to the measures taken by governments to reduce expenditures in an attempt to shrink their growing budget deficits.
    http://www.investopedia.com/terms/a/austerity.asp

    Heraclitusstudent says

    Or you need to stop mindless trade globalization altogether. Trade is the real root of all these issues.

    Absolutely. The reason China is flush with cash is because other countries demand, and the US runs a multi-hundred billion dollar trade deficit with it.

  • On 31 Jan 2015 in Why religion (particularly Christianity) is vile, evil, narcissistic & dangerous, thunderlips11 said:

    Atheists aren't arrogant. Theists are.

    They believe God, who looks like a Savannah Ape, created the entire universe for the benefit of Savannah Apes around a typical sun on an outer arm of a typical galaxy, one of millions.

    As for Dr. Craig, he does the same crap Theists have always been doing - placing God beyond the Clouds, Firmament, Aether, Solar System, Galaxy, etc. to find a place for him. Always placing Yahweh at the very edge of human knowledge, and pushing him back further as knowledge grows.

    Craig himself admits the Kalam Argument is just to shore up the faithful and spread doubt in disbelievers if possible. He himself believes in a Personal God by Faith.

    Extraordinary claims require extraordinary evidence, not just "Proof by Logic".

  • On 31 Jan 2015 in New Greek government already making good on its anti-austerity promises, thunderlips11 said:

    Heraclitusstudent says

    You could say there is austerity in China. Indeed it saves 50% of what it produces. That's what you should complain about.

    Not at all. China is aflush not only with Ghost City construction, but Airports, Railroads, Subways, Highways. More than half of Chinese work at SEOs. It is greatly expanding it's military capacity with expensive modern vehicles and weapon systems. It's funding a huge space program that will probably continue to a moon shot in the next 15 years.

  • On 31 Jan 2015 in New Greek government already making good on its anti-austerity promises, thunderlips11 said:

    Heraclitusstudent says

    No offense but it's a bit naive. One big bank fails and the financial system would be wiped out.

    Then we better take steps to prevent TBTF and embark on policies that encourage many small banks instead of a handful of large ones.

    Heraclitusstudent says

    Credit would freeze everywhere: money markets, intra bank lending, day to day lending to companies, etc... Most banks would fail and those remaining would be so suspicious that they would make loans only to people sitting on golden collaterals

    Keynes and FDR solved this problem almost a century ago. Banks are not the only source of cash infusions into the economy.

    Also, of course, there are massive social effects from hypocrisy of elite driven events.

    Heraclitusstudent says

    You cannot say that of a country that spends more than it produces. There, it should be obvious, demand is not the problem.

    That's the Triffin Dilemma, and it's fueled by a combination of world reserve currency status and bank-friendly goods production-hostile strong currency policies..

  • On 31 Jan 2015 in Why GDP is a horse shit metric., thunderlips11 said:

    GDP is just a tool. It's a valuable one, but it doesn't tell the whole story.

    Blurtman, have you heard of accounting based GDP? You basically add production, then subtract costs like environmental cleanup or having to give foodstamps to employed people.

  • On 31 Jan 2015 in Shake Shack IPO vaults shares into 'nosebleed' territory, thunderlips11 said:

    Sounds like America's economy: Financial Fraud, Fast Food, and Porn.

  • On 30 Jan 2015 in RMB now #5 World Payment Currency - was #14 December 2012, thunderlips11 said:

    indigenous says

    No, i mean him being bullish on asia.

    Well Generally Faber has been and still is generally an Asia bull, though I think he's been talking about a downtown recently.

  • On 30 Jan 2015 in Realtor vermin at Starbucks, thunderlips11 said:

    jvolstad says

    I have the extreme displeasure of listening to the Realtor's gloat about their sales while I try and enjoy a tall coffee.

    Replace the Brown Raw Sugar Packets with Cyanide at the condiments station, just before their "Lunch n' Learn".

    You know what they say, JV, a small act of random kindness makes the world a better place.

  • On 30 Jan 2015 in RMB now #5 World Payment Currency - was #14 December 2012, thunderlips11 said:

    indigenous says

    thunderlips11 says

    Asia Bull Marc Faber

    Is that true?

    From memory yes, everybody who deals in China seriously (beyond "Hey look at how cool and international I am" MBA types) knows that fraud and misrepresentation is the norm in Chinese business. It's considered foundational, and transparency considered a dumb Golden Mountain Idea that can help your competitors destroy you.

  • On 30 Jan 2015 in RMB now #5 World Payment Currency - was #14 December 2012, thunderlips11 said:

    bob2356 says

    No one really knows what's on china's books.

    And that's the downside. Asia Bear Jim Chanos and Asia Bull Marc Faber alike have said it's not a question of whether a Chinese Company's books are cooked, only to what degree.

  • On 30 Jan 2015 in You can earn $13,000 a year selling your poop, thunderlips11 said:

    Finally, a new industry to soak up the hundreds of thousands of yearly STEM graduates!

  • On 30 Jan 2015 in The Bubble In Perspective, thunderlips11 said:

    Bellingham Bill says

    "Biotech, which was defined broadly to include work on drugs, medical devices, research/testing, and agricultural chemicals/feedstocks, gained 96,000 total jobs in the U.S. over the decade from 2001 to 2010, according to the analysis Battelle performed for the Biotechnology Industry Organization. By Battelle’s count, there were 1,605,533 total bioscience-based jobs in the U.S. in 2010."

    How many new STEM grads are there per year? ~355k in a recent year, of which around 300k were bachelor's or higher degrees (the remainder being mostly Comp Sci Associate Degrees).
    http://news.sciencemag.org/education/2014/06/data-check-u-s-producing-more-stem-graduates-even-without-proposed-initiatives

    And yet according to BB's quoted article, less than 100,000 biotech jobs were created in a decade.

    This is because research and development is not a large scale employer, and can never, ever replace manufacturing jobs.

    Or the billions wasted on training people up to and including PhD level in the biosciences, who quit because they make less than most other occupations.
    http://www.adjunctorium.com/2014/09/16/stem-grads-welcome-to-the-world-of-exploitation/

  • On 30 Jan 2015 in Alexis Tsipras "Open Letter" to German Citizens Regarding Extend-and-Pretend, thunderlips11 said:

    saroya says

    You cannot blame the Germans for being furious. Who the hell does Tsipras think he is, Germany? In 1953 Germany still owed many, many, billions to the Western countries for war reparations and costs. The West forgave 50% of that debt and the remainder was allowed to be paid back in small increments tied to the improvement of Germany's economy. Tsipras has a lot of gall!

    Did that know that - didn't surprise me though!

    Also, when East and West Germany merged, they were allow to wildly violate EU Debt standards for a decade.

  • On 30 Jan 2015 in New Greek government already making good on its anti-austerity promises, thunderlips11 said:

    bob2356 says

    thunderlips11 says

    What you're advocating is Socialism for the Wealthy.

    It's only called welfare if government money is going to poor people. If government money goes to rich people it's called investment. They would never blow it on mansions, yachts, and lobbying for more government money.

    Yep.

    And fucking up on such a Global scale to a huge degree, then demanding to be completely sheltered from all ill effects and make everybody pay (no matter what the cost to themselves) to make you whole again, even steven to where you were before, simply because "I'm so special and irreplacable" is not a deeply-entrenched sense of entitlement.

  • On 30 Jan 2015 in New Greek government already making good on its anti-austerity promises, thunderlips11 said:

    iwog says

    Banks shouldn't be bailed out. They should be nationalized and shareholder/upper management wiped out.

    Instead what happened was the Teenage Drunk Driver who caused a multiple car pile up with multiple deaths got his allowance reduced from $5,000 a month to $2500 a month. For two months.

    Then he got a new Porsche, his allowance raised back to $5000 because of all the hardship he endured, and even encouraged to take a few swigs from the bottle to "give him courage".

    Oh, and to add to it: Daddy got the judge to make the victims pay for the new Porsche.

  • On 30 Jan 2015 in New Greek government already making good on its anti-austerity promises, thunderlips11 said:

    tatupu70 says

    thunderlips11 says

    Imagine what demand would look like if home prices were allowed to collapse and banks forced to dump housing in bankruptcies, bringing home prices to a multiple reasonable to average wages.

    I don't think that would ever have happened. Instead, we'd have more hedge fund landlords. Or more people like Iwog. Prices would never get be allowed to get too far out of whack with rents before rich folks would swarm in to collect the easy profits.

    You very well migt be right about that.

    Heraclitusstudent says

    You have to see the obvious: you can't punish the banks without punishing people. You can't save people without saving the banks. Contrary to what lefties would want. People and banks go together.

    Okay, so let me see:

    * Bad businesses deserve to fail if they make bad choices.
    * Except banks, which have to be bailed out, no matter how stupid they behave (and set themselves up for their own failure, like getting bills passed making CC harder to discharge than mortgages)
    * Or the people will suffer.

    What you're advocating is Socialism for the Wealthy.

    Nobody is talking about punishing the banks, simply allowing capitalism to take it's course, with perhaps the government standing by to speed up the bankruptcy process and helping to make the transfer from dumb, irresponsible banks, to well run banks.

  • On 30 Jan 2015 in New Greek government already making good on its anti-austerity promises, thunderlips11 said:

    Heraclitusstudent says

    What are you arguing here? That banks are bad by default? That no one else was involved? The Spanish government fully agreed with what was happening. And this was not unpopular with the spanish people. No one complained on the way in, like people complain about the consequences now. Everyone was in it.

    Let's not pick on Spain alone. Greece, Italy, Ireland, the USA, Iceland (the only country to punish both banksters, lobbyists, AND politicians for the crisis) all had politicians bribed into compliance - some over the table (US Lobbyists), some under the table (like Spanish MPs and even members of the Royal Family).

    People respond to "Market" forces, even when those "Markets" are captured. You don't blame the cough symptom (home flippers) for the lung cancer (housing bubble), but the smoking (banker-pushed deregulation and weakening of oversight).

    The evidence is overwhelming that banks subverted politicians everywhere. From Glitnir to Deutsche Bank to Bank of Asmodeus and Washington Mutual. From minimal reserve requirements to Robo-signing.

    Heraclitusstudent says

    Are you arguing that we should have let banks failed after the crisis? Then again, austerity would have been much worse. No banks, no loans. You would have gone to 35% unemployment. Then maybe after that you would rebound faster. This is the Austrian argument.

    Yes. There wouldn't have been NO banks, shitty banks would be unwound, any good assets they had sold off to non-shitty banks. Regional banks that weren't run like shit would be the beneficaries of picking up good assets at low prices, pumping them up to National or International status. There would have been a lousy few quarters of hardship, and that would have been it. 35% Unemployment? No way. 35% Unemployment can only result in a demand-challenged depression, which Austerity can actually help bring on. There's countless federal programs that could be pumped up with new money printed to replace the dead money, and direct funds to viable businesses in lieu of banks

    Quite frankly, banking should be a public utility anyway - but that's another subject.

    The banks and financial institutions are the biggest donors to neoclassical think tanks and lobbyists pushing deregulatory/re-regulatory benefits to themselves. Through their scholars-for-dollars, they claim "Creative Destruction is Good" - except when it happens to them, then they demand not only Socialism for their mistakes, but Austerity for everyone else which kills demand and slows down the redistribution to good investment from the malinvestment the banks caused.

    Austerity kicks Demand in the balls then steals all the money in his Wallet.

    The restriction of demand by Austerity slows the correction of malinvestment driven by the banks' direct actions. Instead, the banks' malinvestment is paid by all other actors and segments of the economy, including those who suffered when investment was misdirected away from their enterprises.

  • On 30 Jan 2015 in New Greek government already making good on its anti-austerity promises, thunderlips11 said:

    Bellingham Bill says

    "Also problematic are Spain's punitive personal bankruptcy laws, which don't allow unpaid debt to be canceled and make it difficult for bankrupt persons to enter all kinds of contracts, from apartment leases to cellphone plans. Bankruptcy protection is so onerous in Spain that only 235 families applied for it in the fourth quarter of 2012—a 15% increase over a year earlier."

    Just like Germany. They say that many Germans just commit suicide when faced with bankruptcy.

  • On 30 Jan 2015 in RMB now #5 World Payment Currency - was #14 December 2012, thunderlips11 said:

    thunderlips11 says

    Everytime the US tries to sanction a BRIC, expect the RMB to look more and more useful.

    Especially for those countries with their own abundant energy resources that don't need middle eastern oil and want to buy consumer and industrial goods. :)

    China, the USA of the 60s.

  • On 30 Jan 2015 in New Greek government already making good on its anti-austerity promises, thunderlips11 said:

    Heraclitusstudent says

    Let me explain these charts for you: Spain had a large account deficit before the crisis. It was living off increasing debts, private debts in that case (it was more gov debt in Greece), caused by a housing bubble.

    It was experiencing a housing bubble, caused by banks (including foreign banks) inflating the property markets in Spain.

    Let's remember the same banks that caused the property bubble were the ones that fought and got deregulation over the past few decades. They insisted that more was necessary, even until that brief moment when "Wile E Coyote" was flailing in space just off the ledge above the chasm, that it was merely a rest period before continued growth.

    They then begged for bailouts and got them. Government borrowed and printed and guaranteed with the public purse outrageous sums for these private institutions' bad debts.

    We should remember that under post-Depression laws in most of the World (including original EU legislation) tightly regulated banks and no serious asset bubbles worldwide (or really nationwide) had appeared in property markets the late 90s, early 2000s super deregulation round.

    Not only did deregulation cause the asset bubble, it misdirected countless trillions to construction and land purchases, at the opportunity cost of other segments of the economy, from retail to R&D to manufacturing.

    In a word, huge scale "Malinvestment" that went unrevealed much longer than it should have.

    Now, let's think about who is recommending Austerity. Banks who started the asset bubbles in the first place, like DeutscheBank. Institutions that backed deregulation to the hilt, like the IMF.

    So the solution isn't to continue to starve non-financial segments of the economy through weakened spending, lowered demand thanks to stagnant/lower wages and higher unemployment, and increased taxation, but stop further damaging these sectors by forcing them to pay off the debt to the very banks and institutions that started the crisis.

    We missed the opportunity to take a short term big hit by eliminating bad debt, making financial companies and investors eat their losses, and spreading their remaining good assets to new or more conservative institutions.

    The solution now is most certainly not to continue to feed the parasite that caused the illness, but rather feed the rest of the body to get strong and healthy again.

    Money is not backed by gold. Anything "Destroyed" by tossing out bad loans can be printed (or really created digitally) again and reinserted into the economy by a variety of transactions: Large infrastructure projects, R&D Grants, and flat out checks written to households.

  • On 30 Jan 2015 in Alexis Tsipras "Open Letter" to German Citizens Regarding Extend-and-Pretend, thunderlips11 said:

    2002- After a decade of neoliberal governance and policies, Argentina Defaults. GDP Growth Skyrockets after years of decline following a decade of Neoliberal Policies in the 90s.
    2005- First Debt Restructuring, Selective Default
    2010- Second Debt Restructuring, Selective Defaults
    2014- Another round of Selective Defaults

    As you can see from actual observation of reality, the correlation between defaulting and shrinking GDP is, shall we say, "Overstated".

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