patrick.net

WOW! The UNtrustworthy are certainly in control of what information is apparent to the people!

Say hey! This was in the Wall Street Journal on March 30, 1999. Note "... how much it will buy."

Holy cow/interesting/compelling ...!

And where is it up to date??? Right here ... see the first chart shown in this thread.
Recent Dow day is Monday, May 5, 2014 __ Level is 104.5

WOW! It is hideous that this is hidden! Is there any such "Homes, Inflation Adjusted"? Yes! This was in the New York Times on August 27, 2006:

And up to date (by me) is here:
http://patrick.net/?p=1219038&c=999083#comment-999083

WOW! The UNtrustworthy are certainly in control of what information is apparent to the people!

And "ThePublic Be Suckered"
http://patrick.net/?p=1230886

rooemoore says

Strategist says

Call it Crazy says

Strategist says

Why is the 92 million not in the labor force part of "The Not So Good News"?

Do you really want an answer to that??

Yes.

We need about 10 million to move from the not in labor for to full time jobs to be statistically healthy. Also, there is a concern (even from it's supporters) that the ACA will encourage those nearing retirement to stop working early.

That's not really answering the question.
Zerohedge is just a propaganda web site, designed for the sole purpose of misinforming the public. If Hitler was alive, he would have been proud of Zerohedge.

The original "gun nut"............

......The original "homegrown terrorist, who was also a "White Supremacist", had a fascination for "assault weapons", AND associated with "citizen militia groups"..................

...................none other than the "Father of our country",

George Washington !!!

Yes, current day "mainstream" corporate media would label George all the above. I have another term for "Terrorist"...... Patriot. But then I don't adhere to a religion that calls for blood sacrifice so as to be (self) chosen. That seems to be the main difference in modern media and historical fact.

One should do a search for "Who owns American media".....and learn just who profits from their anti-Americanism and their corporate owned media constantly trying to pit Americans against each other. Once one does such a search, digesting said "mainstream" (corporate/Wall Street) media should be much more difficult, even with a public education.

There it is the Hitler reference. Hitler sure has a lot to be proud of these days doesn't he?

Strategist says

That's not really answering the question.

Zerohedge is just a propaganda web site, designed for the sole purpose of misinforming the public. If Hitler was alive, he would have been proud of Zerohedge.

Zerohedge may be a propaganda website, but the fact is that we do need more people in the work force. I'm sure Obama would agree.
BTW, pretty quick to Godwin's law, aren't you?

rooemoore says

Zerohedge may be a propaganda website, but the fact is that we do need more people in the work force. I'm sure Obama would agree.

Yes, all of us would agree to that.

rooemoore says

BTW, pretty quick to Godwin's law, aren't you?

Had to look it up. Interesting.

Godwin's law (or Godwin's Rule of Nazi Analogies)[1][2] is an Internet adage asserting that "As an online discussion grows longer, the probability of a comparison involving Nazis or Hitler approaches 1" [2][3]—​ that is, if an online discussion (regardless of topic or scope) goes on long enough, sooner or later someone will compare someone or something to Hitler or Nazism.

tatupu70 says

And that is another reason why nobody can take Austrians seriously. Do you really contend that the time since the Fed is worse for boom/busts than the time before the Fed?

If you'd like to see the direct effect of the Fed, look here:
http://en.wikipedia.org/wiki/File:US_Historical_Inflation_Ancient.svg

This shows the inflation/deflation cycle since ~1675 to present.

You will notice that before about 1960, there had been economic cycles very frequently, with periods of inflation and deflation. Before the Fed, inflation was caused by regional banks issuing their own money, or gold discoveries, or simple lack of demand for the currency. Deflation was caused by demand, fallout if inlationary capital misallocation and such. What was very different is that deflation and inflation were cyclical over time, and roughly canceled out, yielding a fairly stable currency value.

During periods of inflation, modulo the time-delay of new funds affecting the economy, we had bubbles, speculation, and the same kind of bubble mechanics we have today. During periods of deflation, which we haven't seen since in 60+ years, the capital malinvested during the boom is liquidated through the system. Businesses which take unjustified risks go bankrupt, and their wiser competitors pick up their assets, creating a disincentive to take on too much risk.

The modern Fed effectively started in 1971, when it started issuing credit backed money and severed the gold convertibility from the Bretton Woods agreement. Since roughly that time frame, we have not had any deflation, since contrary to what the Fed states publicly, it has a single mandate - to keep the largest financial institutions from going insolvent, the much publicized dual mandate being the sugar which makes the pill easier to swallow.

The Fed is not the sole creator of economic cycles, but it's been an amplifier. Pre-fed cycles were generally not monetary cycles, they were speculative manias into some sector for the economy, like rail roads or real estate, and when these mania bubbles popped, their effects were less wide spread. The Fed, in an attempt to save banks from going under from taking too much leverage in these manias, turned speculative sector-bubbles into monetary bubbles, which affect the parts of the economy that use money, namely all of it.

I don't think their approach can work to dampen bubbles at all, since the mechanisms by which they do it are to spend credit into existence. This credit doesn't go to Joe Mainstreet, but rather big clearing banks, then wall street institutions, who can borrow at near zero to speculate into assets, and the only ones big enough to accommodate this much money are stocks and housing, which is why we see such gains concentrating there.

Now, I think the Fed has no choice but to taper and accelerate the current credit bubble popping. There are two sides to transaction, and in credit, there is the borrower and the lender. Years of ZIRP/QA have started hurting big lenders, namely fixed return investors into bonds and treasuries, such as state pension plans, and Social Security, which collectively hold many trillions. While these lenders may all be a Ponzi-style sham to begin with, the Fed's actions make their already stretches budgets even worse by reducing the rate of return in the future, increasing unfunded liabilities, and typically triggering additional cash infusions. We can't afford to keep things like, say, CalPERS or CalSTRS solvent in this environment, so the Fed is forced to do a 360 since now it's hurting some truly enormous financial entities (and being the good utilitarians that they are, the'll always avoid doing the most harm based on their own understanding of the markets).

So, the answer isn't very simple, and Reality is only touching on some topical points in Austrian monetary theory. The Austrian school, in my opinion, provides some really good tools for analyzing what's going on, but people of an Austrian bent still disagree with each other (for example, Peter Schiff the hyperinflationist vs Mike Shedlock, the deflationist). Why was Mish right and Schiff wrong so far? Schiff overlooked the power of credit contraction and deleveraging, making a mistake of omission. An economic framework may help you analyze some facts, but it may not work if you neglected to gather all the facts.

The one thing the Austrians agree on with the Fed is that it creates distortions, and that it transfers wealth from society to the wealthy who are close to the money presses, and that it rewards companies for speculative risk, so we get more of that kind of behavior.

rooemoore says

Also, there is a concern (even from it's supporters) that the ACA will encourage those nearing retirement to stop working early.

I agree that we need more in the workforce, but I wouldn't think people retiring early would be an bad thing. I would think allowing those folks to retire is a very good thing--those jobs are open for younger folks that probably need the job more than the early retiree.

I like how that article ends:

The BLM's response was one sentence long: "We welcome Mr. Bundy's new interest in the American legal system."

OK--so given Mell's argument:

myob says

The modern Fed effectively started in 1971

Do the boom/busts look worse or better in the last 40 years?

How can anyone argue this point?

Mikhail01 says

The original "gun nut"............

......The original "homegrown terrorist, who was also a "White Supremacist", had a fascination for "assault weapons", AND associated with "citizen militia groups"..................

...................none other than the "Father of our country",

George Washington !!!

Look up "Whiskey Rebellion".

When faced with a tax protest by early U.S. citizens, who refused to pay their share to settle war debt - Washington rode at the head of a military force (composed of state militias) to suppress them.

Washington would have put these pieces of shit on trial.

(Of course, being the poseurs that these original-intent, the-Constitution-says-what-I-say-it-does types always are, the traitors Washington was hunting down slithered back to their rundown shacks in the woods.)

Iosef V HydroCabron says

Calm down.

These are gun nuts, so it's all Constitutional & as the Founding Fathers intended.

The commerce clause proves this false. The Supreme Court has ruled that the definition of commerce is broad and can include things like going to work or taking a vacation somewhere where you intend to spend money. It would be difficult to find a way that entering Bunkerville by car wouldn't be an act of commerce, making the turning away of people at the checkpoint illegal.

tatupu70 says

rooemoore says

Also, there is a concern (even from it's supporters) that the ACA will encourage those nearing retirement to stop working early.

I agree that we need more in the workforce, but I wouldn't think people retiring early would be an bad thing. I would think allowing those folks to retire is a very good thing--those jobs are open for younger folks that probably need the job more than the early retiree.

Except for the fact that we will be paying for their healthcare. They will not have an income and under 65 so they will get ACA pretty much for free. I don't think this will be a huge issue, but I've heard that it is a concern by those running the ACA.

tatupu70 says

Do the boom/busts look worse or better in the last 40 years?

How can anyone argue this point?

1) Deflation is not bad
2) Your graph doesn't address the question
3) But hey, I am not the one saying that 2008 was SO ZOMG BAD that they had to bailout the TBTFs and buffets of the world because other wise the worst depression evah would have devoured the whole world. So by that token 2008 was so pretty much unprecedentedly bad that the biggest bailout (heist) in history HAD to be enacted. So yes, the Fed et. al. caused the worst depression ever ;) Nobody says it's only the Fed, but they are certainly not helping main street.

rooemoore says

We need about 10 million to move from the not in labor for to full time jobs to be statistically healthy. Also, there is a concern (even from it's supporters) that the ACA will encourage those nearing retirement to stop working early.

Um, that doesn't make sense. For EVERY early retirement worker.. there are probably 100 young people falling over themselves to take their high paying job.

Every 50+ worker who retires.. opens up enough salary cap to hire 2 or more millenials. So that shouldn't be a problem.

Sure you can make prediction,

All else being equal, higher prices lead to lower demand (note the weasel words). You couldn't say "prices will be higher tomorrow" because there's insufficient information.

However, if some new process were developed for making, say, shoes, where it's much cheaper to manufacture them, you could make a prediction of "shoes will get cheaper in real terms, all else being equal". Why the weasel words again? Because the government could come in and institute a shoe tax on imported shoes or sometihng, which you simply can't predict.

If you're willing to make assumptions about certain things ,you can make reasonable predictions using Austrian modeling of the money supply, for example, but you have to acknowledge you can't make them with 100% certainty.

There are lots of "fudge factors" in the models mainstream economists use, things like the core deflator, or hedonic adjustments in CPI which amount to the same thing.

The difference that I see is that the Austrians admit the shortcomings of modeling behavior in a system where all the facts aren't know, and what you don't know isn't even known.

I mentioned Mish before, and his long term predictions have been right on the money! His approach is largely Austrian. He took the time to understand credit markets, and leverage and made those predictions.

I could argue that model driven economics also only works in hindsight, because it's failed to predict so many epic bubbles, and after each one, the models had to be amended. Why, for example, did Greenspan not see the bubble he blew, why did Bernanke not see that there was a housing bubble, and why did he even proclaim that fact repeatedly on TV and in front of congress?

None of these guys have a clue, but the Austrians admit it :)

Sedition

How the hell do you predict what is going to happen with the number of transactions that occur in just one day. 7 billion times, what 10, 70 billion transactions per day times 365 x 10. No one organization can control that and that is where the trouble starts.

What is real is what is agreed is real. The crazy guy sees a pink elephant, he is crazy as no one else sees it. How do you predict that people are going to be willing to spend a years wages on a tulip bulb or 4 times that on a shack in the right zip code.

That is why bonds are the best predictor of the future as that is what is agreed to happen by investors. Money is just an agreement that something is valuable. One day you have the agreement and one day the agreement is different.

I don't how someone like Nate Silvers does his thing but even he says predictions are hard especially about the future.

myob says

only Goldman Sachs has a perfect trading history,

Actually not even GS, only Virtu ;)

mell says

1) Deflation is not bad

2) Your graph doesn't address the question

1. Unemployment is bad. Deflation leads to unemployment. Therefore, deflation is bad.
2. The graph absolutely addresses the question of booms/busts. If you can't see that, you need to look again.

mell says

3) But hey, I am not the one saying that 2008 was SO ZOMG BAD that they had to bailout the TBTFs and buffets of the world because other wise the worst depression evah would have devoured the whole world. So by that token 2008 was so pretty much unprecedentedly bad that the biggest bailout (heist) in history HAD to be enacted. So yes, the Fed et. al. caused the worst depression ever ;) Nobody says it's only the Fed, but they are certainly not helping main street.

Speaking of not addressing the question. I'm not even sure what you're trying to say here.

When I look at this type of work, I see it as damn near a 24-7 occupation. Mish sends out 2 reports a day 7 days a week.

The point is it hard work, much harder than digging ditches. It is based on methodology, logic, past experience, consuming a lot of information, and again hard work.

Buffet said that he used to read a half dozen newspapers front to back every day. And even he would be history if not for uncle Ben.

I can't count the times I sold a stock at a local maximum that lasted for a while or forever so far, I also post stocks that I like once in a while, some of them doubled in a short time, haven't we all ;)

tatupu70 says

1. Unemployment is bad. Deflation leads to unemployment. Therefore, deflation is bad.

This is an interesting statement, and it's partly true, partly false.

In an economy with a market valued currency, deflation is itself not detrimental to employment levels. All it means is that goods get cheaper over time as productivity increases, so it helps savers, and investors and companies adjust their books accordingly. It rewards saving to spend vs borrowing to spend, but the economy finds a balance regardless.

We don't have a market based currency system, so deflation leads to unemployment because it is a symptom of deleveraging. The financial system ends up being borrowed short, and lent long and so it's subject to liquidity crises. Even when there isn't a crisis, fluctuations can destroy companies running at extremely high leverage ratios. In such an environment, mid-size businesses face a margin squeeze, as they have price-sensitive customers, but COGS are going up due to inflation (COGS tend to go up bottom up - first on things that come out of the ground, then the next stage, and up). This is what hurts employment. The fundamental problem is leverage driven insolvency, with a coating of bailout moral hazard which results in this being a widespread problem. Without bailouts and without such high reserve ratios, deflation isn't much of a problem _in an economy that's adjusted to it_.

When Mish and others talk about deflation not hurting, they're describing the first world that I mentioned. That's the one I'd prefer to be in. I don't think there's a way of getting to it without short term misery and pain as the leverage unwinds or the dollar collapses, but it's where we will end up eventually, irrespective of Fed action. Timeline? No idea. The dollar can't survive too many more bubbles of increasing amplitude.

Ok Barney but I still want you to keep the one bullet in your pocket.

myob says

In an economy with a market valued currency, deflation is itself not detrimental to employment levels.

Not sure what you mean here. Fiat currency is market valued.

myob says

All it means is that goods get cheaper over time as productivity increases, so it helps savers, and investors and companies adjust their books accordingly. It rewards saving to spend vs borrowing to spend, but the economy finds a balance regardless.

That's one cause of deflation. We see it in electronics typically, but not many other places.

myob says

We don't have a market based currency system, so deflation leads to unemployment because it is a symptom of deleveraging

It has nothing to do with fiat or hard currency. Deflation typically occurs when demand falls--and that lack of demand could be caused by many factors: inequality, lack of confidence, etc.

myob says

This is what hurts employment. The fundamental problem is leverage driven insolvency, with a coating of bailout moral hazard which results in this being a widespread problem. Without bailouts and without such high reserve ratios, deflation isn't much of a problem _in an economy that's adjusted to it_.

Couldn't disagree with this any more strongly. Moral hazard is completely overblown as I've shown many times. And if everyone is getting bailed out, how does it cause unemployment??

The problem is lack of demand. And right now inequality is the cause.

myob says

When Mish and others talk about deflation not hurting, they're describing the first world that I mentioned. That's the one I'd prefer to be in. I don't think there's a way of getting to it without short term misery and pain as the leverage unwinds or the dollar collapses, but it's where we will end up eventually, irrespective of Fed action. Timeline? No idea. The dollar can't survive too many more bubbles of increasing amplitude.

They're describing a fantasy world that has never and likely will never exist. Productivity gains are at the expense of workers and drive inequality. This, in turn, leads to less demand. It has nothing to do with currency and/or the Fed.

"That's just inconvenient. Bunkerville wants them out."

Jeezers. I'd be calling the nat guard and local law in if I was a resident. A careful resident might be able to film a lot of the stops as evidence of detainment, breach of privacy, or if they go looking in a vehicle, unwarranted search.

They are going to go down pretty quick from here I think. Crazy.

Yes bring it on, this administration could use a good ole fashioned Ruby Ridge.

I still suspect this is a made-up or at least based on overblown facts. All the other stories about this from the MSM have been the same. All an attempt to sway the public opinion away from the ranchers and to the government's side. Why should I believe this?

I don't know why the Democrats just don't get someone like Anderson Cooper to interview them. One of them are bound to slip up and mention they don't like colored or gay folk. Then the Twitterverse will descend on them with a vengeance.

Those bullets are no match for a disparaging hash tag.

If there are guys stopping cars driving around that's wrong and illegal. Even cops need a probable cause or a traffic violation to stop you.

Yahoo of course is a suspect source for news.

To most people the biggest "story" is the rancher said some things that others perceived as racist.

The real story is that BLM was a bully, but media will make the rancher the story.

Having beliefs that someone calls "racist" is your right and there are some laws against things you may do but your thoughts and speech are yours.

rooemoore says

In other words, we don't have a real crime yet.

I'm sure we are at least breaking traffic laws at this point, and as soon as someone complains formally, it's going to be an ultra-strong false imprisonment case ... because it IS false imprisonment.

Even if a victim of a crime doesn't report it, a crime still occurred.

Quigley says

2) setting up a checkpoint isn't illegal, I think.

It absolutely is.

Every driver should set up a nest in their backseat, complete with cokes, tunes, tarps, and audio/video surveillance equipment.
Take the muthafuckas OUT and SKATE!!!

It's not a good thing that there are so many people out of the workforce.
102 million not working, 118 million working. What could possibly go wrong?

People who don't work cannot save. People who don't work cannot buy much so they have a lower standard of living. People who don't work of course do not produce anything.

Zerohedge is OK, they are observers of the financial experiment since 2007. They may worry too much or not enough, time will tell.

i want every unaccountable retard thug cop replaced by an unaccountable unemployed Soldier of Fortune subscriber.

A well-regulated militia is one with no authority structure, training or accountability. Fathers are reviled and hated figures, which is why all corporate structures, and the military, are run on an anarchical, anything-goes model, with no lines of authority.

Straw Man says

Quigley says

2) setting up a checkpoint isn't illegal, I think.

It absolutely is.

Apparently its only illegal if you believe its illegal. Bundy doesn’t believe in any authority beyond the county sheriff. That is why he feels he has the right to run his cattle on public land and not pay grazing fees, to him federal law does not exist, In fact he doesn’t believe that the United States of America exists. I don’t know about the moron militia that came to defend his right to over-graze land he doesn’t own.

The best way to handle this probably is to wait until it reaches 120 degrees every day and see how many are left. I suspect most will bail during the lovely Nevada summer weather. Or maybe they have jobs they do unlike the negros Bundy saw sitting on the stoops in Vegas. Eventually Bundy will have to sell the cattle they should then be seized and sold to pay some of his debt.

Past performance is mostly useless for future predictions IMO - that's why it is always different this time and never a better time to buy a house! Same goes for technical trading.

CaptainShuddup says

I don't know why the Democrats just don't get someone like Anderson Cooper to interview them. One of them are bound to slip up and mention they don't like colored or gay folk. Then the Twitterverse will descend on them with a vengeance.

Those bullets are no match for a disparaging hash tag.

Liberals have different standard for their own. Obama made some racial remarks during his recent partying. Not a cricket was heard from liberals about it.

WOW! The UNtrustworthy are certainly in control of what information is apparent to the people!

Say hey! This was in the Wall Street Journal on March 30, 1999. Note "... how much it will buy."

Holy cow/interesting/compelling ...!

And where is it up to date??? Right here ... see the first chart shown in this thread.
Recent Dow day is Tuesday, May 6, 2014 __ Level is 103.6

WOW! It is hideous that this is hidden! Is there any such "Homes, Inflation Adjusted"? Yes! This was in the New York Times on August 27, 2006:

And up to date (by me) is here:
http://patrick.net/?p=1219038&c=999083#comment-999083

WOW! The UNtrustworthy are certainly in control of what information is apparent to the people!

And "ThePublic Be Suckered"
http://patrick.net/?p=1230886

I speed-read this and commented....

SoftShell says

Because he said something like an entire race would be happier as slaves or that his black wife shouldn't be seen hanging around white people?

There's only a double standard if both sides are equal. The sides are never equal.

without reading this above it...
SoftShell says

FortWayne says

Liberals have different standard for their own. Obama made some racial remarks during his recent partying. Not a cricket was heard from liberals about it.

I only had 13 seconds to work with...