patrick.net

Almost all of the rise in the FIRE sector economy is due to the continued Fed action. I don't disagree that on a deep crisis like in 2008 the markets overshoot on the downside, but the majority of the pull is Fed action to this day. Look at the dollar which cannot even compete with a crap currency like the Euro, make no mistake the big debasement is afoot and there will be another crash due to these actions. It is irrelevant how deep that crash will be, it is likely that it will not reach the lows of 2008, but that is of no consolation as inflation made the dollar worth far less.

Heraclitusstudent says

How many 1oo yrs old houses do you see around you?

Houses do have a limited lifetime, and are in fact depreciating.

I see quite a bit around me. In every area I've lived in there were always nice neighborhoods/towns that had 100+ year old homes. And they were very desriable.

In any event--the wood and nails don't appreciate. The land does.

debyne says

bob2356 says

Sorry to interrupt you with reality but that's exactly backwards. M/M sets the rates which drives the insurance companies rates. Read up on Centers for Medicare and Medicaid Services.

Sorry to burst your pseudo-reality bubble, but providers set those prices.

http://www.marketplace.org/topics/life/health-care/world-health-care-pricing

Be nice is you actually read what you posted. The rvu committee sets a value. The CMS (medicare) sets the price, which may or may not be the rvu value. The vast majority of insurance companies follow medicare since doing their own calculations for thousands of procedures would very costly.

Someone has to calculate what things cost, the people doing the work are usually the best resource. Who do you think would do a better fairer job of setting prices or are you just someone who sees everything as a vast conspiracy to complain about?

What industry are you in and who sets your prices?

For a couple of years when I was living in the middle on nowhere, I was a practice administrator for an OB/Gyn. Every provider contract with an insurance company I've ever seen was a percentage of Medicare. So if a provider is on the Blue Cross roster, he/she agrees to be reimbursed at (for example) 120% of Medicare rates. This was the case with every provider contract I've ever seen. Where there's room for additional money to be made is in the coding. There are ways to code things that are better than others. It's become rocket science.... and an increasingly expensive function of a doctor's office.

Given that, many have gone the out-of-network route. The reimbursements are much better. However, this typically means more out-of-pocket to the patient.

But these higher reimbursements available to out-of-network providers has led to some questionable practices among facilities (like surgery centers). There's one particular group of surgery centers (located in the Bay Area) that is currently in litigation with Aetna. Here's what they do:

They are out-of-network for all insurance companies.

They look for patients who need surgery who have out of network benefits.

They perform the procedure in their surgery center and then charge some truly outrageous fee for the surgery (Like $66K, for a bunion removal).

Then, they collect the out-of-network percentage on the outrageous total.

This is the best part.... They never make the patient pay any co-pay, deductible, or anything. Why? Because they extracted a fortune from the insurance company. So for what's probably a couple of thousand dollar procedure, they're getting $30k. The insurance company has no idea that the patient never contributed their deductible, so the insurance company assumes that the patient met the deductible (which affects future treatments, too).

The surgery centers make out like bandits, the patients don't pay anything... it's quite a deal. Aetna caught on and is pretty pissed. They aren't the first to sue for this practice (there's another in New Jersey) but the outcome of this case could have some serious impact on the practice in California, at least.

I agree that the practice is completely dishonest. It's just funny to see someone best the insurance company.... However, we will eventually pay for it with higher insurance premiums.

Anyway... Here's an article on the story if you're interested in following it:

http://www.bloomberg.com/news/2012-02-03/bunion-repair-at-66-100-spurs-aetna-lawsuit-against-clinics.html

bob2356 says

Be nice is you actually read what you posted.

That's the pot calling the kettle black:

"...who do you suppose sets the price of individual medical procedures? If you said insurance companies or the government, you're only half right. Because the prices your insurance company pays are based on a set of values listed in a phone-book sized directory of billing codes. Those codes are pretty much the economic hierarchy of modern medicine. They say what's costs more: a colonoscopy or a CT scan or chemotherapy? And those values are set by a closed-door committee of the American Medical Association.

I already said that M/M sets their own prices...read my original post. My additional point is about how private insurance companies get theirs...it's NOT based on prices set by M/M. If they all were set by M/M, doctors would go out of business.

But what about the NAR Code of Ethics? Doesn't that protect the public?

You have to look at the greater good, how many atrocities do American presidents commit that we never hear about?

You also have to consider the context of his circumstances, many leader of the past would make Pinochet look like a boy scout.

Again it is like an aircraft carrier it takes time to get these things going especially when it was previously a socialist country.

sbh says

You favor definitions quoted as scripture from within a black box of factual ignorance and denial. Axiom trumps fact for you simply by the act of your speech.

I like to think of it as having a professional view point verses having a practical view point.

The problem is that there is so much specious information out there.

I heard it said that there were only 6 Ausrians a hundred years ago.

bgamall4 says

tatupu70 says

It's clear from this video that the biggest problem in the US is the fact that the bottom 25% of citizens don't pay any taxes.

Only to a madman. You apparently are going crazy. (edit) the post was being sarcastic and I didn't catch it. My apologies.

He is just being sarcastic.

You know "those people" like all kinds of Nanny State Big Gubmint Socialist programs.

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, December 9, 2013 __ Level is 102.5

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 http://patrick.net/?p=1230886

sbh says

You favor definitions quoted as scripture from within a black box of factual ignorance and denial. Axiom trumps fact for you simply by the act of your speech. It's like talking to an evangelical who's only argument against the concept of deep time is to quote the Bible. No wonder math and representations of measurement creep you out. Fuck facts, let's pray!

Statistics do not equate to fact. Lies, damned likes, and statistics :-)

When a Keynesian observes the rooster crowing 10 days in a row ahead of the sun popping above the horizon, he concludes the rooster causes sun to rise above the horizon based on the 100% correlation.

An Austrian would interject that the rooster is only an observer responding to whatever other phenomenon preceding the sun rise.

The Keynesian then gives the prescription that, in order for the sun to rise earlier, we can go molest roosters in their sleep! simply because their crowing would lead to the sun rise!

Ahem, and I quote myself:

http://patrick.net/?p=1234352&c=1026966#comment-1026966

I'm not convinced at the moment that Zimmerman is guilty of domestic violence. The whole case seems a bit fishy.

And this from a guy that is quite convinced that Zimmerman murdered Trayvon Martin.

I never in a million years would have thought I would be defending George Zimmerman. But I severely disapprove of false accusation of domestic violence or any other crime.

Now, if only the authorities could find some new evidence against Zimmerman in the Trayvon Martin case, at least there could be a civil case against him.

Should make US companies more competitive.

Call it Crazy says

I wonder what they will say now???

There will be resounding silence.

In contrast, when President Carter bailed out Chrysler, the bailout consisted of loan guarantees, and the taxpayers earned a $350 million profit.

The times, they are a changing.

werent there a bunch of people on this blog claiming that we made money from the bailouts???

So what's the solution?

bgamall4 says

Strategist says

So what's the solution?

House prices have to decline, to reflect the loss of wage power. In the meantime, families have to band together to live multigenerationally or with siblings or many will die very poor.

Falling house prices will mean less construction of new homes, which means a shortage of homes, which means higher rents.
Are you sure you want that?

A big house like that, in a wonderful area like that, with a rate that low.
I wish I had that problem.

bgamall4 says

Strategist says

Falling house prices will mean less construction of new homes, which means a shortage of homes, which means higher rents.

Are you sure you want that?

Well, eventually household formation will stop if rents rise. Then the banksters may as well slit their wrists. Here is the problem, housing has been pumped up by the wealthy, and is distorted compared to demand and wages. I don't know the answer, but high house prices can't exactly reduce rents, either.

The Walmart of home building can solve this whole problem rather quickly.

Unfortunately one of those doesn't exist at the moment.

bgamall4 says

Strategist says

Falling house prices will mean less construction of new homes, which means a shortage of homes, which means higher rents.

Are you sure you want that?

Well, eventually household formation will stop if rents rise. Then the banksters may as well slit their wrists. Here is the problem, housing has been pumped up by the wealthy, and is distorted compared to demand and wages. I don't know the answer, but high house prices can't exactly reduce rents, either.

I have no problems with bankers slitting their wrists, It ain't my blood that will flow.
There is no such thing as the wealthy pumping up prices. It's their money and if they want to pay more it's their business.
What will reduce rents is moving to a cheaper and smaller place.

bgamall4 says

Strategist says

A big house like that, in a wonderful area like that, with a rate that low.

I wish I had that problem.

Lol, isn't that the truth. And perhaps adjustables are for these people, however, if time comes to sell and he is under water, then what?

In that case he stops making payments, and you get to pay the bill.
That's even a better problem I wish I had.

whatever happened to that perma-bear theory that rents only go up with income (chart #1)?

wait until the dollar bubble bursts (within 10 years according to my estimate) then watch the rents skyrocket when my mortgage remains the same.

Mark D says

whatever happened to that perma-bear theory that rents only go up with income (chart #1)?

wait until the dollar bubble bursts (within 10 years) then watch the rents skyrocket when my mortgage remains the same.

That perma bear theory is crap. Rents are determined by demand and supply, and nothing else. No landlord in San Francisco cares if the McDonald burger flippers can afford rent or not.

Strategist says

That perma bear theory is crap

that pretty much sums it up.

sbh says

it poses the question: which do you think is yours, the professional or the practical?

Austrian economics has been an avocation for a couple of years now, I'm not a professional but I try to view anything I do as one. It is pretty obvious when someone like Reality or Mish, or only a couple of others I have run across on the internet, are professional. The way you can tell is that one they know every nuance of the subject and they actually apply the knowledge, usually in business.

Something that has served me well is the idea of being interesting or interested. If you try to achieve the prior you will be in endless useless pissing/posturing contests. On the other hand you can be interested this is the guy who actually can apply the knowledge he succeeds as it sounds like you were with your business.

We don't get a spiff for turning people on to this subject. It might be worth a look?

sbh says

by natural law "all about" this or that, being an exemplar of an unmeasurable quality recapitulating said natural law by virtue of the definition of a rooster. Austrians do two things: 1) define something; 2) say the thing. Then they're done.

Let's be Austrians. Here is natural law: porkfat is heavenly.

You obviously do not understand what natural law is. "Heavenly" is a personal subjective description, utterly irrelevant to any natural law. Natural law is not any particular person's subjective standard, but that which logical individual choices would lead to in the absence of man-made laws enforcing special privileges for certain individuals at the expense of others. For example, "thou shall not kill or steal" is a pretty simple natural law regardless what religion you believe or not believe; price control being an exercise in futility is another expression of natural law, because individuals faced with price control would act in self-interest or even cheat, leading to shortage at official price while moving transactions to black market, etc..

indigenous says

It is pretty obvious when someone like Reality or Mish, or only a couple of others I have run across on the internet, are professional. The way you can tell is that one they know every nuance of the subject and they actually apply the knowledge, usually in business.

Thank you for the compliment . . . although personally I do not profess to know every aspect of Austrianism, nor do I get paid for learning it or sharing it. Learning does help put my own ego in check, helping me to see the futility of empire building, and the joy in making other individuals happy/content, one at a time. I have been offered on numerous occasions to get paid for what I write, but I have chosen to maintain my privacy and independence. I guess large sums of money has never been a huge draw for me. I see money as tokens of appreciation; I'd rather earn them my own way from numerous people instead of becoming reliant upon any big patron.

Reality says

I do not profess to know every aspect of Austrianism

Professionals usually don't. I hear you it is about the quality of the exchange.

Meccos says

werent there a bunch of people on this blog claiming that we made money from the bailouts???

Yes. Same ones that claimed the entire financial system would collapse if the tbtf banks went into bankruptcy or got nationalized.

Call it Crazy says

Scheibe said in the affidavit that she "felt very intimidated" when she was being questioned by police and that police "misinterpreted" her. She also said she "may have misspoken about certain facts."

Women ! will drive you to an early grave....

ah the good old days....

http://www.youtube.com/embed/98qw86DsdZ0

bob2356 says

Meccos says

werent there a bunch of people on this blog claiming that we made money from the bailouts???

Yes. Same ones that claimed the entire financial system would collapse if the tbtf banks went into bankruptcy or got nationalized.

I can't speak for anyone else, but I've been on record saying the bailouts were basically cost neutral--excepting, of course, GM. The auto bailout was always a loser. But, you should be thinking about what would have been the cost if GM were allowed to fail--lost jobs (GM and suppliers), lost tax revenue, unemployment benefits, etc. Would it have been more than $10B?

And, it's very easy for folks like Bob to claim that the financial system didn't need any bailouts AFTER it was bailed out. We'll never know what would have happened absent the liquidity injection, but if there was a 5% chance that the system collapses--is that a risk worth taking??

Just saw the last part of your post--who claims that the system fails if the banks got nationalized? I've never seen that argument anyway--what I see is the dreaded socialism claims.

tatupu70 says

But, you should be thinking about what would have been the cost if GM were allowed to fail--lost jobs (GM and suppliers), lost tax revenue, unemployment benefits, etc. Would it have been more than $10B?

That would be the price of fixing the problems that led to the bankruptcy; i.e. the GM capital structure and labor relationships that led to the inefficiencies and bankruptcy would have been removed, and the resources and human labor made available to other carmakers. Instead, the taxpayers were forced to cough up $10B or more for essentially a kick of the can down the road.

tatupu70 says

it's very easy for folks like Bob to claim that the financial system didn't need any bailouts AFTER it was bailed out. We'll never know what would have happened absent the liquidity injection, but if there was a 5% chance that the system collapses--is that a risk worth taking??

What if there is a 5% chance the sun won't rise if we don't sacrifice your first-born? Asking such question is committing fraud of the hypothetical. Banking will not cease to exist, so long as it is a necessary service. Some of the big banks would indeed cease to exist . . . turns out even one as big as Lehman getting liquidated did not result in much impact on the financial system. Swaps and derivatives are by definition zero-sum games. For every loser on a trade, there is a winner as his counter-party.

He's hung like a moose. And there is the future royalty stream from the movie series, George Zimmerman, Manhunter.

Wonder how the numbers are collected. The charts may actually reflect the rising underground economy instead of anything else. Just like the mushrooming of Americans on disability (not actually disabled) due to government policies, the combination of high taxes, high minimum wages and government subsidies is driving many Americans to take on jobs that pay under the table (like day labor off the books) or even illegal (such as drug trafficking and prostitution) while using low legit income to qualify for government subsidy programs.

NO they have Socialized medicine.
If we had a "Single payer" it would be nothing more than a Monopoly that would be free to charge at will while they enjoy a protected market without any competition.

Besides that it was always called "Socialized Medicine". Fuck if you even try to read the Wiki article on "Single Payer" the definition is all over the place, only written to project what other countries have with out actually giving us a "Socialized Medicine".

So basically a Single payer is ...

The Government assuming the role of Bluecross and Blueshield, with private contractors making all of the administrative calls.
Our implementation would come loaded with premiums, copays an all of the other hidden cost scheme, that comes with Insurance.

Here's one shoe fits all legal definition that our policy makers are using to sell this bill of shit...

In some cases doctors may be employed, and hospitals run by, the government such as in the United Kingdom. Alternatively the government may purchase healthcare services from outside organizations. This is the approach taken in Canada.

Sure sounds like two different definitions than what we would end up with. So basically a "Single Payer" is what ever Harry Reid and Nancy Pelosi would call the damn thing. Tell a lie long enough, then "Obamacare" starts to sound like a Single Payer system.

What difference does it fucking make who I write a $1600 (or more)check a month too?

Reality says

What if there is a 5% chance the sun won't rise if we don't sacrifice your first-born? Asking such question is committing fraud of the hypothetical.

lol--but we know that sacrificing my first born has no bearing on the sun rising. Are you implying that it was known that the banking system wouldn't fail? You're committing the fraud of false analogy.

tatupu70 says

Reality says

What if there is a 5% chance the sun won't rise if we don't sacrifice your first-born? Asking such question is committing fraud of the hypothetical.

lol--but we know that sacrificing my first born has no bearing on the sun rising. Are you implying that it was known that the banking system wouldn't fail? You're committing the fraud of false analogy.

Yes we know that. "Banking system fail" is a (false) imagination of the mind, like unicorn and tooth fairy. When one or several restaurants or supermarkets close, we don't call that "food distribution system failure." So long as there is market demand, someone else will step in, and probably do a better job without the government putting the burden of rescuing existing banks on them.

There actually has never been in human history a sudden stoppage of all banking activity in a society except for when the government banned all banks from opening. It's always a government-made crisis.