patrick.net

This is an excellent idea.
"Congress should implement spending cuts and entitlement reforms.."

Starting immediately, Members of Congress receive minimum wage,it's an honor to serve America. They purchase health insurance with their money on the free market. If they want a pension,an IRA,401k,etc.should suffice.Oh,we're not paying for that either.

This also applies to the POTUS,SCOTUS & other govt. Peons.

freak80 says

sbh says

I am an unabashed blue collar moderate liberal

You'd probably fit in pretty well here in the Rust Belt where I live.

Sadly, much of the blue-collar moderate economic liberalism has been wiped out by a steady stream of far-right propaganda telling us that Democrats want to take our guns away. Deer hunting is a very popular activity around here.

George Carlin:" Good honest hard-working people; white collar, blue collar it doesn’t matter what color shirt you have on. Good honest hard-working people continue, these are people of modest means, continue to elect these rich cock suckers who don’t give a fuck about you….they don’t give a fuck about you… they don’t give a FUCK about you."

HEY YOU says

Starting immediately, Members of Congress receive minimum wage

Agree. All of the bribe money is more than enough to live on all by itself. :-)

George Carlin was one of the few willing to stand up and tell it like it is.

"America: it's a big club...and you ain't in it."

Call it Crazy says

By dollars or percentages??

That's a fair question. I do not know.

It's hard to tell by just looking at a chart. We'd need actual numbers.

Call it Crazy says

Yep, they should all wear fire suits, like NASCAR drivers, so we would know who their "sponsors" are....

Love it!

Unfortunately there wouldn't be room for all of the corporate logos.

Call it Crazy says

Well, what that hell are you doing sitting here typing??? Go do some research and report back.... Pronto!!!

How much will you pay me?

I refuse to be paid in anything other than Spanish silver because of the severe inflation going on right now. ;-)

Does anyone notice the genuine humility in Mr. Buffet's discussion of economics....

Call it Crazy says

I was going to pay you with hookers.....

Sounds good to me!

Has there been inflation in the price of hookers?

Say hey! This was in the Wall Street Journal on March 30, 1999:

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 Thursday, September 26, 2013 __ Level is 97.9

WOW! It is hideous that this is hidden! Is there any such "Homes, Inflation Adjusted"? Yes indeed, go here:
http://patrick.net/?p=1219038&c=999083#comment-999083

Doesn't matter, someone with all-cash is going to win the house, anyway.

freak80 says

The facts you post show that the national debt increases fastest during
Republican presidencies.

and the Prez dont spend money, CONgress does.

I have been very fortunate in my life to have met and been advised by someone who made his fortune at a very young age many, many years ago. He was an inventor and a smart investor. He passed away but his advise he gave to us made our retirement.

We said to him we only made very little money and he said if you "don't know how to save pennies, you cannot save thousands".

When he would write a letter regarding a fund he had his money in, he would not get a letter back, nor just a "phone call or email", the CEO of each fund would call him personally to address anything he needed addressed.

He was a very simple man, yet could have lived beyond money, and very humble.

My point was that usually those that truly know and understand the system, and are truly successful, do not go about calling names and bragging about their knowledge and their investments.

He always said, "this is just my advice, you need to do what you believe is right for you"...always said that. Of course, you could take his advice to the bank.

I enjoy the bloggers on this sight that bring true insight by sharing their thoughts on the facts that have obtained. I do not always agree with their conclusions, but they cause me to "think" and evaluate my opinions against their's which leads one to come to an educated decision.

That is all I was trying to say....

I can't speak for Schiller.

However, as for Peter Schiff being an "idiot," let me point you to the following:

http://www.zerohedge.com/news/2013-09-25/peter-schiff-was-right-part-deux-“taper”-edition

http://www.youtube.com/embed/2I0QN-FYkpw

But let me guess. The clip is from zerohedge so it's made by a bunch of "conspiracy theorist," right?

The only thing that's a fantasy is the belief that a half-baked third-rate community college professor and a slumlording rentier from Lafayette masquerading as a hippie know more than people like Schiff.

Great, cut out the guns. No need to have half the world's military spending. Smaller military = less interventions.

This chart shows a strong correlation between the party in the White House and the derivative of debt.

This chart shows little to no correlation between the party in Congress and the derivative of debt.

The second chart does not contradict what is implied by the first. I could post a graph showing no correlation between the number of puppies chasing squirrels in my yard and the national debt. That wouldn't introduce any new information.

As for the first chart, the gigantic upswings during the Republican administrations are easy to explain and quite frankly, only someone completely ignorant of history would not see the obvious causes of those spikes.

Reagan spent vast quantities of wealth in an arms race with the Soviets to drive them into bankruptcy while reducing the bargaining power of labor, and thus their income, and thus their taxes.

Bush the Moron the First basically followed in Reagan's footsteps, except with the Cold War over, instead of decreasing warfare spending, he increased it. Hence his spike.

Bush the Moron the Second started several wars and financed them all with debt.

So yeah, having a Republican president is the worst thing possible if you are sincerely worried about the national debt. Republicans tend to start expensive, unjust, and intractable wars while fucking up the economy. And that is why they cause the national debt.

Call it Crazy says

Hmmm, I think there is one problem with your assertions:

Bap33 says

and the Prez dont spend money, CONgress does.

The hell presidents don't!

Congress approves budgets, but presidents spend money the moment they start ANY military operation. Just because the money isn't budgeted, doesn't mean it ain't being spent.

CiC,

Why do you constantly defend the party that wants to enslave you to a permanent aristocracy? No, the Dems aren't a whole lot better but they are the lesser of two evils.

Is it social issues that make you support republicans? Have republicans ended abortion or prevented gay marriage?

Black Helicopters.

Dan8267 says

The hell presidents don't!

Congress approves budgets, but presidents spend money the moment they start
ANY military operation. Just because the money isn't budgeted, doesn't
mean it ain't being spent.

Really, and just where does that mililtary come from? Militia?

Or maybe active duty troops whose expense has already been accounted for by congress?

Call it Crazy says

sbh says

.......and this never gets old:

Now, let's overlay your chart of who was president with who controlled congress at that time. As we all know, spending has to come from congress, the president just signs (or doesn't sign) the bills presented to him...

This chart looks a little different...

*

Yet neither chart is very truthful. There is a lag of several years for policies to take effect after they have been passed. In many cases congress changed hands in that time. After that happens very little legislation gets accomplished and things motor on autopilot.

The big debt increases from Reagan's policies and W's policies that were put in place very early in their presidencies. It's true Reagan had a split congress, but he was unbelievably popular and a very skilled politician. He pushed through tax cuts and increases in spending that exploded the debt later in his presidency when congress had turned Dem. W even more so, pushing big tax cuts and spending increases through a Rep congress that later turned Dem. Clinton's early polices passed by a Dem congress dramatically flattened the debt increase later in his presidency when Rep's had taken congress. Clinton also had a very large run of good luck. The economy was experiencing the dot com boom with lots of taxes flowing in combined with very low energy costs. Plus Bush I had passed legislation that helped reduce the increase in the growth of the debt mostly after Clinton was in office. Bush I lost the election, Clinton got the bulk of the credit.

sbh says

Call it Crazy says

Dude, go do some searching here... You'll find out I don't support EITHER party!!! I have always said, they are different sides of the same coin!!!

If you think only ONE side wants to enslave you, you really need to wake up!

Where are pulling your delusions from, your ass???

We run up against you because even if you support neither party you seem only to rail against the left. It's what one doesn't say that informs ones opponents as to your true leanings. We moderate lefties have plenty blue spots to pick at within the Democrats....they're politicians for fuck sake, it's easy to hit the low hanging fruit.

That's odd, because I don't know that I've ever once read any criticizm of the dems, by the dems, relative to the constant bitching about how "stupid republicans ruined everything"

Interesting article, thanks. I think it's spot on.

"You don’t have to be a communist to conclude that high levels of inequality not only...

But once you conclude that, you are one!

One. More. Time: The plebes have not worked as hard as the wealthy since January 1981. Even though tax cuts have made it easier to become wealthy, and improved the economy tremendously, one still has to work.

The middle class didn't work as hard as the wealthy. You don't work, you deserve the shaft.

BTW, why are some pretending that this is the first bubble that these out-and-out Krasnui Bolsheviki have inflated to mask a broken economy? Pretty much everything that Pinko Greenspan did was bubbly, and he was merely following the example of a long tradition of red commie inflators who maintain high spending during growth periods.

With a relatively low marginal propensity to consume among the rich, when they receive the vast bulk of income growth, as they have, then the country will face an under-consumption problem.

No: Reagan said this is not so. Therefore, it is not so.

This is the return of the usual extreme Stalinist claim that tax cuts do not pump as much money into the economy as spending. False. No amount of evidence could convince me otherwise.

I can't believe that these coastal elites think they're better than me!

Bellingham Bill says

Hey crazy, you've got some cuts you want to propose?

The alternative is tax raises, mostly on the rich, who are making most of the money now.

Plenty. Get rid of ALL special housing deductions, special capital gains loopholes for housing (the 2 year rule) and dissolve the FHA, FNM, FRE. Next claw back the money from all bailed out TBTFs, if needed by confiscating executive pay and their "assets" in the hamptons until the taxpayer money is paid back. Dissolve insolvent entities and auction off their remaining assets and distribute to the taxpayer. Cut all farming subsidies and section 8 housing subsidies, provide more soup kitchens and homeless shelters instead if needed. Oh man, just getting started here. All of that is much more effective and fairer than claiming people making 200K+ are "wealthy" and taking more of their money.

bgamall4 says

The wealthy and corporations have a record amount of dollars. Yet they don't invest.

That is certainly not true in general. A lot of the top-performing tech corporations maintain only a couple of months of payroll cash, i.e. if suddenly they would start posting losses layoffs would only be a couple of months away. I would call that investing heavily in their staff. Sure there are those who hoard, but since when is maintaining a capital cushion a negative thing? This is the perverse nature of the neo keynesian drivel. Suddenly savers (no matter if individual or corporations) are the "bad hoarders" and the wasteful spenders the "good consumers/investors". Capital formation is the necessary foundation of every successful economy and sound money system.

bgamall4 says

Tell you what, let house prices drop to where it isn't worth it to build a house and you can let wages drop.

Agreed.

bgamall4,
"Trickle down does not work." I'll have to call you on that.I'm expecting my Trickle Down Check any day now.
Since the SCOTUS decided we're all Citizens United, I should not have any problem receiving a 0% loan like the TBTF.
ROFLMAO

Let the small investors & businesses struggle while others breeze through this FUBAR or in other words "Lay there & bleed."

Isn't the desire to make other people miserable the very definition of conservatism? "I've got mine, fuck you!"

freak80 says

Isn't the desire to make other people miserable the very definition of conservatism? "I've got mine, fuck you!"

That's a red herring. By providing a general welfare allowance not tied to any crony-capitalist subsidies the middle class will be much better off and less people will be slipping into poverty, plus the poor on the allowance can actually pay for a place to rent. What part of "my full rent is almost the same as some of the subsidies for section 8 housing" is so hard to understand? It's our resident crony capitalist neo-feudal landlords who benefit from these program while pointing their fingers at the "badass" fiscal conservatives.

http://localsov.com/abuses/hud/housing.htm

Facebooksux says

I wouldn't worry though, the Bernank can print that shit in about 2
hours.

I'm sad to say, I agree.

http://www.bloomberg.com/news/2013-09-23/wal-mart-elevates-70-000-workers-amid-stocking-complaints.html

Wal-Mart Hires Workers for Holidays Amid Shelf Complaints

Wal-Mart usually hires temporary workers to get ready for the holiday shopping season. The company is adding more permanent people to improve customer service after failing to keep shelves stocked and handle other store-level operations, said David Galper, head of retail and apparel investment banking for KeyBanc Capital Markets Inc.

Cleveland Research Co. said in a Sept. 18 report that “one of the key issues” hindering Wal-Mart’s store operations “is the lack of labor in the stores to get the inventory out of the back rooms and onto the sales floor.”

I will believe it when I see the shelves stocked properly.

MOOT

They don't let bubbles pop anymore.

This is from the same company that just spent 'billions' on buying single family homes and is still not making a profit on that investment portfolio and is now trying to sell the portfolio to other investors as a bond......being they are having trouble renting all of its purchases.

By the way, Blackstone "borrowed" the money to purchase these homes...so I guess they do know a credit bubble when they see it....

Oh myyyyyyyyyyyyyyy.......

mell says

the US needs savers, healthy capital formation as a basis for a sound money system.

We'd have more "savings" if we didn't have $4T/yr being beat out of us in the housing and health care sectors, half of that if not more in economic rents.

http://research.stlouisfed.org/fred2/graph/?g=mPQ

per-capita housing + health expenditures

How can people "save" when rents and home prices rise 10% each year?

Note that this is not cost-push inflation, like what we see in bacon or ground beef.

This is simply due to the fact that housing sucks ALL the money out of every economy. It has to, since land is fixed in supply and demand will always exceed it, at least until a virus comes and wipes most of us out again.

I'm currently house-sitting on a 2-acre estate in the Santa Cruz mountains; it's on a hilltop and I can see maybe 4 other homes around here in the thousand-acre-plus view. This is an "apex" property, and everyone would like to have this, but so few can. And the housing market is structured this way right down to the shit shacks in E Oakland, at every rung of the ladder there is more demand than supply.

Savings is simply income less consumption. But so much of our consumption has embedded rents in it. The true fix is to attack these rents, so we'll have more "savings".

Even then socialist paradises are seeing this dynamic. Norway -- one of the richest (and least-crowded!) nations in the world on a per-capita basis -- idiotically started allowing interest-only loans 10 years ago, and that just pushed their price level up proportionally.

"Sound money" is another thought-terminating cliche, since the problem isn't the money, it is us. Richest man in the colonies went broke due to land speculation; the nation's BK laws were originally written to get him out of debtors prison, LOL.

Say hey! This was in the Wall Street Journal on March 30, 1999:

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 Friday, September 27, 2013 __ Level is 97.5

WOW! It is hideous that this is hidden! Is there any such "Homes, Inflation Adjusted"? Yes indeed, go here:
http://patrick.net/?p=1219038&c=999083#comment-999083

freak80 says

"America: it's a big club...and you ain't in it."

The Prussian Junkers had to explicitly structure their voting system to weight the 1%'s votes more -- the top 5% of income earners got 33% of the vote essentially.

http://en.wikipedia.org/wiki/Prussian_three-class_franchise

In the US, the 5% just has to bamboozle 45% of the electorate with bullshit ideology and social issues. They've got about that much now, especially if you count the people who don't vote.

mell says

It's our resident crony capitalist neo-feudal landlords who benefit from these program while pointing their fingers at the "badass" fiscal conservatives.

I agree with this. Even California's $10 minimum wage is a rent support in disguise, since the LLs will take it all in the end.

but this:

plus the poor on the allowance can actually pay for a place to rent.

isn't quite right. The only solution to the big problem is increasing the supply of quality housing everywhere. Like I said on DeLong's site today, we need to invest in housing as much as we invest in defense -- we need to outspend the rest of the world in housing investment!

Drive rents to zero.

Same thing in health care too, of course.

We have a serious problem with lack of savings in united states:

http://www.usatoday.com/story/money/personalfinance/2013/06/24/americans-emergency-savings/2445965/

According to the article, only 24% of americans have enough savings to cover 6 months of expenses. Having 6 months of savings in cash equivalents is a pillar of financial security and is even recommended by investment advisors despite the fact that they would probably prefer these funds to be "assets under management." While this problem is definitely in part caused by many people not making much money to begin with, it is definitely not the only reason as half of all americans that make over 75Gs don't have 6 months worth of savings and half of this demographic has no savings at all. This reflects the fact that not making savings a priority is a core fundamental problem of our society and the values of its citizens. With some people blowing their entire incomes on discretionary items how are they ever gonna save the traditional 20% down payment for housing? To accomplish this requires prioritizing and in a certain sense sacrifice.

dublin hillz says

With some people blowing their entire incomes on discretionary items how are they ever gonna save the traditional 20% down payment for housing?

20% DP is unnecessary and just serves to keep people renting longer if not forever.

Now, 20% savings cushion actually makes sense.