Paper: Policy helped avert Great Depression II
Submitted by
CalculatedRisk on Tue, 07/27/2010 - 6:58pm (357 comments)
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That's assuming that it has, in fact, been averted.
Comrade Kristina wrote:
Instead of Great Depression II, we will get the Lesser Depression. Half a loaf is better than none.
Comrade Kristina wrote:
1 rule of a flat economy... try this 1 weird old tip
Re-posting after being pigged out - in the Marc Faber article on Zero Hedge that someone linked, Faber says 'You don't want cash during deflation". Huh? Does anyone have a clue why he would say that?
I'd ask the commentariat at Zero Hedge, but, well, y'know....
Didn't Zandi think the tax credit was a good idea?
alex black wrote:
Bonds do (a little) better than cash in deflation, if the issuers remains solvent. He may be thinking of something else.
In addition, there would be about 8.5 million fewer jobs, on top of the more than 8 million already lost; and the economy would be experiencing deflation, instead of low inflation.
The fact that there might have been alternatives for the banks (like wipe out the shareholders, haircut the bondholders, fire the BoDs, fire the top management, recapitalize and reboot) never gets mentioned, I'm sure.
Anyone who missed the housing bubble deserves no audience.
Bond Girl wrote:
He works for Moody's. The tax credit was a good idea for Moody's.
......Without this Fairy Tale Miracle Policy we'd be climbing our way out of this pit by now instead of covering ourselves with additional fecal matter....
rich wrote:
I was referring to the 30-40 group supporting another bubble. I was not commenting on their chances of making a 'come back'.
Comrade Kristina wrote:
Good point. I, for one, don't think it's been averted, but it will certainly play out differently than GD1.
Seems as good as any a marker for the start of the next leg down.
Rajesh wrote:
...that lasts twice as long.
dr munch wrote:
I missed the housing bubble... I live in the rural midwest and was in school both in 2001 and in 2005 with no money to reasonably afford any sort of house. My prudence is more a factor of circumstance than deliberate choice.
alex black wrote:
My understanding of Faber is that he's predicting a total meltdown that will eventually result in the $US becoming worthless.
He may be referring to that.
The full Faber quote - "You don't want cash if massive deflation happens. On the contrary; it will be worthless."
It still has me scratching my head, which is nothing new.
Policy: Paper helped postpone Great Depression II
I'm thinking he's talking "Mad Max" type deflation. In which case you probably want to be heavily invested in lead, beans and rice...oh and
sdtfs wrote:
Blackhalo wrote:
Ever been in an earthquake? It's not the initial quake (or two) that gest you, it's the aftershocks. The pressure drags on, the uncertainty. By Week 2, some people who seemed okay in the first few days start to lose it....
Lesser severity and longer length could well be a worse experience for society than a shorter, more acute failure. In fact, I'd bet on that.
Rajesh, "Instead of Great Depression II, we will get the Lesser Depression. Half a loaf is better than none."
We need the whole loaf............I want change. Safety from those Assh*les from doing it again.
mp wrote:
Ah, question answered, right before I could restate it. Thanks, MP.
Re-posting from last thread:
Comment by patientrenter from thread 'How far will the homeownership rate fall?'
or
Rajesh wrote: "I see deflation, followed by deflation, with a period of more deflation after that."
My response:
Wolf! Wolf!
You know how Japan is held up as the modern epitome of deflation? Here are the actual CPI values for Japan:
2009: 100.3
2005: 100.0
2000: 102.2
1995: 100.7
1990: 94.1
1985: 88.1
Consumer prices in Japan have been basically stable for the last 15 years. That's not deflation, nor is it inflation. It's long term price stability.
alex black
Faber is implying that deflation quickly leads to a Mad Max scene, because of all the financial defaults and losses that would wipe out the economy, jobs, etc
mp wrote:
sorry to abandon you last night, mp, I found some ice cream, fresh peaches and
supplied whipped cream in the freezer that needed multiple rapid quality control taste tests......
bien sur. he was on mccain's economic advisory committee, along with john taylor and kenneth rogoff.
GDv2.0 ... my guess is this topic will have 400 posts by 6AM PST tomorrow... you want over or under?
and don't forget my bestest buddy in the world...Phil "mental recession" Gramm...
Over.
CK, "I'm thinking he's talking "Mad Max" type deflation."
I'm thinking we have gone beyond "Mad Max'. The inter-cities may or may not go stupid, Drugs, Ignorance, and Stupidity make for a bad combination.
The rest of us will deal with it.
That's true. People under the age of 40 won't "bubble up." But the biggest reasons aren't the housing bubble or the dot.com burst.
The biggest reasons are job insecurity, job unavailabilty, falling real wages, and the steadily rising cost of living.
It's pretty amazing what it cost a 30-year-old today to maintain "a decent modern lifestyle," compared to what it cost a few decades ago at age 30.
The biggest cost increase factors are housing, utilities, taxes, education and health care. They are much bigger than a lot of people think.
I'm out of gas myself JP.
Black Star Ranch wrote:
Hah! Thought so. Not a problem.
"...Mark Zandi, chief economist at Moody’s Analytics] argue that without the Wall Street bailout, the bank stress tests, the emergency lending and asset purchases by the Federal Reserve, and the Obama administration’s fiscal stimulus program, the nation’s gross domestic product would be about 6.5 percent lower this year.
In addition, there would be about 8.5 million fewer jobs, on top of the more than 8 million already lost; and the economy would be experiencing deflation, instead of low inflation."
Zandi may have a few technical talents, but he has been nothing but a cheerleader for the bubble and FIRE, and for measures to help keep air in the bubble, and FIRE fat and happy. Of course, if you pour $2-3 trillion dollars into an economy, it will react. You can do that pouring through FIRE and asset prices, and have it trickle down, or you can pour it into a rebuilding of our economy from the bottom up. Zandi is not interested in that.
The "policy" saved the banks by covering their gambling bets, courtesy of the taxpayers!
patientrenter wrote:
Not at all. None of them are.
* bearly wrote:
Just not to the poor.*
I said "from wealthier to poorer". I believe this is accurate.
*bearly wrote:
The bottom 50% pay 2% of income taxes. *
Though it's not relevant to my argument, I will note: I am currently in the top tax bracket, but I found it much more difficult to pay my income tax when I was in the bottom tax bracket. I'm not so focused on my own (older) nose for this to escape me now.
All of these programs helped avert a second Great Depression. A victory for all involved. Just don't unwind them. Ever.
Bond Girl wrote:
Oh and don't exhale either.
Bob Dobbs wrote:
I'm a little torn on that point. A collapse severe enough to bring about the failure and BK of those with bad business practices and models is a good thing IMHO. One so severe that it brings anarchy and Mad Max, not so much.
Of course propping up the insolvent, in an effort to maintain the status quo, of failed speculation, is the second worst outcome in my view.
The only way you're going to get final demand, which will spur investment, is jobs. Jobs, jobs, jobs.
At this point, only the Congress can make that happen, but it isn't politically do-able and the Fed is pretty much out of ammunition barring, of course, what I call the monetary nuke, and there's no guarantee that even that will work.
The people of this country are going to end up stewing in their own juices, which is not good.
Y.T. wrote:
,
Blackhalo wrote:
The really kewl thing about just propping up insolvent bankers to save the status quo temporarily is you still get a second shot at the 'worst alternative'.
I was equally confused by Faber's comments on wanting to be out of cash for a deflation. Didn't think that pertained to dollar since cash is more generic term and so far as I know, not particular to the dollar per se. Frankly, you don't want to be in cash during massive inflation either.
Bond comment makes most sense, but still...
As to the estimates of job losses, etc. It's basically how many angels dance on teh head of a pin given the quality of the data that they start with. I don't buy much of it... And finally, don't consider either to be much of what I'd call honest brokers given their backgrounds and histories.
I think GD II has been averted. What has taken its place isn't peaches and cream and that wasn't promised anyhow. Well those that still look for Xmas presents from Santa might have expected more. Anyhow, it is difficult to see at this point where and how the US grows from here. We haven't had real growth since the 60s after all.
Ah well, like was said above, we will get a different version of the Great Depression, since we don't have the restraint of the Gold Standard weighing us down. Now we can pretty much instantly print money, spend it on wars and unemployment, and have people working at something- keeping the chances of riots down to a minimum.
The really funny part is Wall Street is running right back into the game that splattered them last time. Bubble up! This ends well.
I was looking at the Nikkei up over 1% tonight and thinking that Mrs. Watanabe could get a good return being in the market just two weeks a year, buy the run up and sell out after 7%.
I am also thinking it will be a long grind through this mess.
Boredom punctuated by panic. Ten more years of this.
Someday this war's gonna end...
rich wrote:
If you notice CR's graph, home ownership rates peaked around 2004-5. Job market during that time was pretty good.
CRimages: Homeownership Rate Q2 2010
Ding ding ding.
Toto, I don't think that we're in Kansas anymore.
I would like some consistency in explanation. If a Great Depression II was averted, what was going to allow that outcome to be a possibility and where does that stand today? It's impossible to claim that a huge disaster was averted without admission of some significant problem. A market crash would not have destroyed any real wealth, it would have just reallocated it through the vacillations
p.s.
debt plan, interest moratorium, guaranteeing lending short term.... Hoover had a plan to keep a defaulting sovereign in Germany nominally solvent as well
rich wrote:
I'm in that boat, though sort of a cheapass... It's a symptom of a sick society and woefully corrupt socioeconomic structures when living a reasonable lifestyle as a single person requires earning the median family income of the state in which you reside (besides denial, ignorance or bliss). Period.
Another big reason people under the age of 40 won't "bubble up" is that they will never believe in the integrity or fairness of U.S. financial markets, the way their parents or grandparents did.
This is directly due to the failures of the SEC and Fed as regulators and protectors against market manipulation, leverage and insider benefits over 30 years. Of course, the SEC and Fed were encouraged in this by every Presidential Administration from Reagan to Obama.
Obama is the worst smoking gun of them all. The fact that he caved in to market manipulation, leverage and insider benefits so fast has turned people under the age of 40 against the markets, more than any other single thing.
mp wrote:
The only way you're going to get jobs is final demand, final demand, final demand. Quite the dilemma, eh?.
Define "decent modern lifestyle."
Being single at 30 is historically abnormal. Of course this crisis didn't come out of no where. The poor haven't done well for a long time.
Coming soon to a House of Representatives near you...
"We have sort of become a nation of whiners," he said. "You just hear this constant whining, complaining about a loss of competitiveness, America in decline" despite a major export boom that is the primary reason that growth continues in the economy, he said.
"We've never been more dominant; we've never had more natural advantages than we have today," he said. "We have benefited greatly" from the globalization of the economy in the last 30 years.
Mr. Gramm said the constant drubbing of the media on the economy's problems is one reason people have lost confidence. Various surveys show that consumer confidence has fallen precipitously this year to the lowest levels in two to three decades, with most analysts attributing that to record high gasoline prices over $4 a gallon and big drops in the value of homes, which are consumers' biggest assets.
"Misery sells newspapers," Mr. Gramm said. "Thank God the economy is not as bad as you read in the newspaper every day."
Mr. McCain's economic program will seek to enliven growth by enabling taxpayers to opt into a new, simplified tax system with two low rates of 10 percent and 25 percent and no itemized deductions, he said."
alex black wrote:
I don't see a dilemma. The economy is in a trap, just as it was in the '30s, and the window of opportunity to fix it, without truly heroic sums of money, is closed.
They blew it.
homedad43 wrote:
Minimum 200 friends on Facebook.
mp wrote:
Many will adapt. But first they need to give up the idea that things will go back to 2005 normal.
Eldest considers working with brain-injured patients as a career choice. Given the prospect of guns and foreign adventures to keep the masses ginned up, she's probably going to have a job, a job, a job.
alex black wrote:
Well, if business won't hire them, then government will have to hire them.
Welcome to the euthanasia of the rentier. Good luck at finding a safe return anywhere.
I can hardly wait to hear the screams here when the higher taxes kick in, and more government regulation.
The Velvet Fist of Government.
As I warned two years ago.
The screams are already starting, although I agree with Krugman, if tax cuts made a business paradise, where is it?
After all, we should be experiencing a
economy here in Arizona, taxes are lower than the surrounding states except Nevada, which for some reason is doing even worse.
Someday this war's gonna end...and I have to take out the recycling.
mp wrote:
Amazing what a change 35 years will make. Hell, even Nixon rolled out a jobs program in the '70s, Title VI of CETA. Open to anyone who wandered in who'd been unemployed more than X months; there were more restrictions on other CETA titles, but VI was wide open: CETA cops, CETA civil servants, CETA insulation/weatherization installers (even then), and on and on.
And now... such things... they're the devil.
One more point about Zandi. Yes, he is a FIRE / bubble spokesperson just as much as Larry Yun is a spokesperson for "now is a good time to buy a home". And when he makes a point to sing the praises of something, it's prima facie evidence that what he is talking about is yet another instance of theft by FIRE. So what does he praise here?
and he praises all these things by saying that unemployment would be higher without them. He cares most about the unemployed, does our Mark.
What many people here don't realize is that inflation, even at 1-3% a year almost every year, enables enormous amounts of income to be skimmed off by FIRE. It's very hard for money managers to take 1-2% of assets every year when nominal yields are just 0-2%. Make them 1-5% a year, and it's much easier. Why else do you think inflation is targeted here, when Japan manages with zero inflation (not deflation, as I explain above)?
badger wrote:
So the exceptions to the general trend should subsidize the general trend (via higher taxes and fewer deductions, renting versus owning, and insurance policy premiums), to further lower its cost of living?
mp wrote:
What was the fix that they missed?
Hell, if Facebook is the criteria, I could live in a shack in Bum
, WVA and be considered upper middle class.
Besides, how many of these friends would turn you over in the gutter to make sure you don't drown in your own puke.
alex black wrote:
There is probably quite a bit of HELOC and other debt fueled economy left to unwind, still. Until economic actors are re-aligned into sustainable Main St. activity, I don't see any seeds of recovery. The parasite has outgrown the host.
badger wrote:
BS. We had tons of it from early 80s to late 90s - real growth & huge productivity gains.
In 1977 I worked in a factory making milking machines - I was 'production control'. No computers, no MRP, no CAD - etc. We had type writers, file cabinets, card catalogs [for open orders], blue print machines, snail mail, phones - everything took forever with a gazillion mistakes & redo's & 'just ship it anyways'. That all went away as PCs came onto the scene.
That all resulted in real growth that lasted for over two decades until everyone had the same weapons and stalemate was re-established.
Some day I ought to write up a description of a 'typical day' back in that plant - it would read like 'Pioneer Times' to most people today.
there would be a dilemma if one believed individual actions had no effect on the group, which is what bearly was arguing against RE for in the last thread
particularly in America, the value placed on an individual's freedom of possible choice is very high and there arises the conflict between potential or practical realities and theoretical or possible scenarios
The fix that they missed pertained to the real control and regulation of the Wall Street Barons.
That would make a very colorful status update...
Comrade Kristina wrote:
Dr Doom says buy Spam-it lasts forever and you can eat it.
as opposed to
Citizen AllenM wrote:
Ten years? So you are an optimist too then?
That strikes me as something positive.
But I see the overwhelming negativity has not eased on HCN in the past week or so.
Meanwhile, downtown Salt Lake City is absolutely booming with new construction and revitalization projects.
The malls in the suburbs were basically traffic jams. I can't speak for the registers, but the mass of humanity was certainly out in force and milling about.
Blackhalo wrote:
When the fisherman overexploits the lake that once was full of fish, at best case the fish all die, and at worst the entire ecosystem collapses, creating systematic failures and shortages for anything higher in the food chain. Rate of extraction exceeds the rate of replacement. Welcome to FIRE.
Dems white folk, sportsfan.
alex black wrote:
The short answer is: there wasn't enough stimulus. Now, the economy has fallen into a deflationary trap.
In deflationary traps, there is a window of opportunity and, IMO, that window is now closed.
That all resulted in real growth that lasted for over two decades until everyone had the same weapons and stalemate was re-established.
interesting...
rich wrote:
That's exactly what i said...or tried to say.
sportsfan wrote:
Yeah if you're on prescription meds and don't question the source of the paper or the reason behind the paper
sportsfan:
Yeah, I see the same thing. But also see that there's a growing and probably permanent underclass.
rich wrote:
We'll see what happens with this new financial regulation bill. If he appoints Elizabeth Warren, I got high hopes.
homedad43 wrote:
YouTube - UB40 One In Ten 1981
The UK's past is our future.
dr munch wrote:
With really really big families - lotsa stuff to buy.
If he appoints Elizabeth Warren, I got high hopes.
On one hand, concur.
On other hand, sometimes easier to be the one who's gadflying than having to work within a bureaucracy that's rigged to minimize your effectiveness.
See: Paul Volcker
sportsfan
haven't spoken to you since that late night scuffle, it was not significant to me at the time, but i am never sure how my posts are ultimately absorbed, so i just wanted to say sorry in public because i would not want to maintain a divide even if polite and silent
dryfly wrote:
Well, about twelve to ten years, roughly when half of the boomers have retired into what will pass as their golden years.
I am sure the hiring line at Home Depot will only get longer for part time jobs with a chance at health care, until we go full Eurosocial.
After all, capitalism has failed in the traditional Republican Mantra- kill regulation, kill government, and kill taxes. We got jack all for that one. And the first one on the left with a big enough bullhorn to talk to the unemployed will get huge support.
I don't think too many at the Cato institute are going to be able to refudiate that thesis.
Someday this war's gonna end...
sportsfan wrote:
Um, I was up in Brian Head last winter, and they were definitely feeling the Great Recession- complete with foreclosures galore on ski properties- so that has turned? Because I was reading this week's Aspen online rag and they were all about the megasplats.
Someday this war's gonna end...
dryfly wrote:
I worked in a distribution center for a department store chain, college job, mid-70s. For each shipment that came in, I remember hand-writing what was actually received versus the amounts and models on a carbon of the PO, stapling the ship list to it and refiling it in a holding file until the next bit for that shipment came in. When everything was in, or nearly, the PO would move on to God know where and somebody would get paid.
Bar codes? Hah. Label guns and pin-taggers. And no fancy inventory conveyance system either. It was all housewares, but check, mark and reship several hundred cases of stoneware in a couple of hours and you'll get a new appreciation for the term "durable goods."
EvilHenryPaulson wrote:
EHP, I'm glad you did so.
homedad43 wrote:
The thing is - we had real growth - it just wasn't shared throughout all of society. I mean where do people think the huge wealth differential came from - it came from productivity gains that for the most part accrued to capital and NOT to labor. But the gains were there and real.
rich wrote:
I wonder about the great grandparents of the under 40s who lived thru the crash of the 1929-1939 period. It took a long time to get folks back in the market after that period (essentially 20 years ) and some financial innovations. I suspect most folks would like to change the name of Wall Street to Casino Alley. Its a good business where the house can adjust the odds to meet its requirements, a better deal than the Las Vegas Casinos.
homedad43 wrote:
That's only a fix if one assumes it was ever possible.
dryfly wrote:
Yup, absolutely.
dr munch wrote:
Great lead, but I wasn't going to comment on the social interaction.
Yeah, the good ol' days.
Let's let the college guy drive 1500 metal stakes. And then we'll let him run the diamond saw. And tote the 5 gallon igloo water container from the truck to the inaccessible back part of the site...
dryfly wrote:
Please do, it will help future generations understand how things were done. I recall reading one time how the phone company did bills in the 1930s and it was interesting.
Tommy Vu wrote:
Okay, trade the negativity for personal insults. Whatever makes you happy.
homedad43 wrote:
As do I, but that's been growing for decades. The important distinction in my mind is when do we call the formerly middle class the new working class because that will be the sea change in America.
homedad43 wrote:
I didn't even mention the semi-trailer full of broken store display mirrors....
ldmeier wrote:
I'll see what I can do - if I do I'll try to post it up in 'Community'.
mp wrote:
I think it's a mistake to believe that inflation would rescue us. Take Japan. People sometimes claim that Japan's big mistake was letting deflation get out of control. Look at the Japanese CPI stats. They have had stable prices for 15 years, with no net inflation or deflation. Stable prices are good for economic efficiency. What Japan failed to to was reform their most inefficient economic practices. They have very efficient, mostly export, sectors; and large unreformed hopelessly inefficient domestic sectors.
In the same way, we don't need inflation, if that just means a return to asset bubbles and debt growth. We need a shift in real resources. Less FIRE. Dramatic decreases in spending on medicine (without reducing life expectancy). More exports and fewer imports. A long term, and almost total, shift away from oil. Etc.
It's the real economy, not the money illusion activity that comes from inflation or asset bubbles, that will improve our lot the most. Asset bubbles and inflation create economic activity, but that activity is ultimately no better at producing real wealth than ordering large groups of people to dig holes and fill them again. It allows us to record activity and growth, but all it's really doing is just preventing people from doing other things that are more useful.
ldmeier wrote:
The productivity gains were astronomical just like the resulting profits. The East still has ways to go to leverage them. The computing power commoditization has down wonders to level the potential playing field.
patientrenter wrote:
It would not be correct to say that I think inflation would rescue us. I'm not saying that at all.
I am saying that deflation could destroy the economy.
edit:
Regardless of whether it's severe inflation or deflation, both are perverse conditions.
and I think they have been very useful in forecasting.
Forecasting what? The price of tea in China?
Speaking of China...lets watch the
patientrenter wrote:
Does anybody know what is the real economy anymore? It's not FIRE... is it exporting endless goods overseas while the folks overseas send the same thing back at us?
My thought is that the new "real" economy doesn't exist yet, and it's not going to get going without a big kickstart from somebody with a big wallet. And who could that be?
patientrenter wrote:
I think the only way we manage that is for most of the country to become either Christian Scientists or Amish. Or both.
Hubris!
Quite a few politicians and economists said GD I was over in the early 30's as well.
bionics; lab grown organ, tissue, and bone replacements
we'll have pretty functional androids in a few decades, even if they're not smart, so long as the cost of production is low enough it really opens a new set of possibilities
how would society function without the bottom menial labor rung, a pure service/creative market economy?
Comrade Kristina wrote:
Excellent first comment, CK.
I'd say they're premature in their call.
Citizen AllenM wrote:
There's a development by the Jordan Landing Shopping Center in Sandy, Utah (a suburb south of SLC) that had five or six empty houses for sale in the space of a few blocks. Didn't look healthy to me.
Edit: 4th of July
EvilHenryPaulson wrote:
Hi EHP. My mistake that night was trying to engage you in conversation on a very lengthy and deeply thought comment of yours which I found to be overly academic and tried to bring down to earth and you found my comments politically motivated.
In fact they weren't (though I understand why others would think I had that disposition because some of my comments are).
I just felt bad that you came out with this massive set of issues and potential alternate resolutions so late at night and didn't want your comment to go with no replies, which is where it stood at the moment. However, after I thought we were conversing, I did sign off after a comment that I thought was beneath you and, for that comment only, of course the apology is accepted, nor would any be necessary or appropriate for the balance of your comments that night. Frankly, I wish I could keep up with your academic prowess, but I live a simple life and I'm stuck in my own reality so that is how I see things.
I always look forward to your comments. I hope you continue to find commenters engaging your thoughts.
W.C. Verones...lets not forget a chicken in every pot!
YouTube - Ben Selvin Happy Days Are Here Again 1930
Did the whole process work in the end?
Honestly, how many angels dance on the head of a pin? This is truly a case of choosing your poison.
Call me revolutionary anymore, but the question that I have after all of this is what does it matter? The paper is flowing, but the mechanism that created it remains in place. The bonuses continued to be culled and the FIRE continues to accrue benefits while the real economy continues to suffer.
It will only continue and ultimately occur again. At least had the system seized, there was the prospect of real change.
alex black wrote:
Like the French or Germans?
They spend half of what we spend on medicine, but are just as healthy. They use far less oil per unit of production. They have a much more closely balanced external trade.
You don't have to be Amish or a Christian Scientist to practice smart economics.
I think his point was that significant deflation is such a Mad Max scenario that paper money is no good.
I kind of agree. We are in moderate deflation now. If we get severe deflation, we'll have a breakdown of law and order and you'll want food, guns, and ammo. I'd rather hold gold and silver in that scenario than dollars, as the printing presses are inevitable.
PR - if you want stable prices for real goods in this deflationary environment then they are going to have to inflate [create money supply & boost velocity]. What you have pointed out - and many others here have as well - is the structural flaw that FIRE due to their proximity to the Fed window can capture the money & divert it to 'pre-existing bubbles of their own making' instead of into backfilling the collapsing economy on main street.
Until the structure is made sound printing more money won't help. I think a lot of us realize that now - both left & right - funny how few of the policy wonks acknowledge it. Something Upton Sinclair once said addresses that.
dryfly wrote:
Yup.
sportsfan wrote:
Yep, i see that now too. And India has the new real middle class. They are presently buying factories in England. They have arrived. We will eventually catch on.
patientrenter wrote:
IMO, the Japanese CPI is as much a lie as the U.S. one but in different direction for obvious reasons. Also, huge energy cost increases really mask the real world. I don't have the stats handy but when I monitored Japan closely between 2003 and 2007, month after month there were declining retail sales. That was the reality.
check out household food purchases from 2001-2009
http://www.stat.go.jp/english/data/getujidb/index.htm#h
71,770
71,210
69,910
69,640
68,699
68,111
68,536
69,001
68,322
Here is consumption:
309,054
305,953
301,841
302,975
300,531
294,943
297,782
296,932
291,737
Now that is deflation.
Citizen AllenM wrote:
Went to a concert in Deer Valley one night and was amazed at the crowd. They sold 6300 tickets. I don't think 6300 people live in Park City, but they probably came from the big city for the show.
Meanwhile not many of the ski resort type condos were occupied, but it's hard to tell if their owners just weren't there for some reason other than financial. The hotels were not booked solid, but they had decent occupancy.
What blew me away was the new construction. It was like Las Vegas circa 2002, but I don't think it's a bubble, again because of who lives there.
idiots
Black Star Ranch wrote:
maybe so, or not;
but the pit would be much much deeper
This isn't just practicing smart economics. It's fundamentally altering a mindset that's been inculcated for decades.
Example: We finally caved in and bought a Blue-Ray along with one Blue-Ray disc. At the video store, the clerk - young mid-20s slacker dude - raved about how good they were and how he'd just "tossed out" his DVD collection and was now in process of rebuilding his collection of about 80 films with Blue-Ray.
I honestly didn't know what to say.
if we can avoid the misery of war / disease / famine while sorting out our economic/political/social problems
I'm looking forward to the 2020s, really excited about technological advances and that's enough time for everything to come together for a good wave. Materials, electrical, biological convergence on a very small scale
sportsfan, "As do I, but that's been growing for decades. The important distinction in my mind is when do we call the formerly middle class the new working class because that will be the sea change in America. "
sportsfan, be care full you do not miss the "sea change in America".
I'm not sure you see the society.......... the People the same way I do.
dryfly wrote:
I'd like to read that also, but I'll bet you're too young to remember when the greatest production/inventory/shipping innovation of all time was the 80 card column card.
I always wondered how those holes worked, back when they were holes and before they were chads.
dryfly wrote:
Yes, that is correct. I get a little more uppity than I should about the loose usage of the terms 'deflation' and 'inflation', dryfly. I see time and again people assume that Japan has deflation, when its own official stats say it doesn't. Or that the US has no inflation, when the official stats say it does.
People call certain things deflationary or inflationary because they tend to lead to deflation or inflation as results. The trouble is that, eventually, some people who don't understand the terms start to confuse the causes with the results. It's a pointless battle to correct that, I realize.
EHP, "Materials, electrical, biological convergence on a very small scale "
EHP, Think Big.
Thanks for a nice, cogent synopsis of the entire situation. That one paragraph is being passed on to multiple people that I know and don't quite see it no matter how I discuss.
sportsfan wrote:
Hah! I remember punching those damned things with what looked like a Braille machine and searching them with knitting needles.
Does that make me old enough?
Yeah, and groups like Insane Clown Posse will have music considered as "oldies" and playing in the grocery store.
patientrenter wrote:
I assume that you saw my post... That is real deflation not theoretical at all!
mp wrote:
We ran a 1000-person job-training program with those cards and needles. Watching MIS do a data pull was an thrill.
patientrenter wrote:
An exaggeration on my part. Mostly I was responding to your assertion that we need to export more, import less, and I think, "In a world of serious wage arbitrage, what can we possibly produce to export at a competitive price?" - and I come up with "Not much". So we have to go to the "reduce import" side of the equation, and I think, "What can we stop importing?" and I come up with "Almost every piece of crap we import." And then I think of the simple joys of the Amish.
I think a healthy dose of "Amishness" would be good for us - it's the Thoreau in me. The Christian Scientist remark was just me being dumb - but the cost of health care here vs Europe is a complex discussion......
EvilHenryPaulson wrote:
I'd like to live at least ten more years.
Bob Dobbs wrote:
I think the ones we used were made by Royal-McBee.
Remember those damned things?
Bad Dawg Bobby wrote:
I think the 'sea change' is happening now. I'm not sure how you see the society so I can't comment on the other.
homedad43 wrote:
He will be buying those old movies for pretty cheap. I see them for sale all the time for small dollars second hand now.
The ability to buy max detail intellectual property will be nice in the future. As I told my wife, when you buy online, you just get a "working copy"- but when you own the disk you can view it on anything, and blu ray is truly close enough to film that an upgrade will be very difficult for old video stuff.
Someday this war's gonna end...
I'd like to live at least ten more years.
Yeah, I've got at least that long to get Youngest through HS.
RE wrote:
A couple of comments:
Here is the full data set for Japan that I used: http://www.stat.go.jp/english/data/cpi/zuhyou/158ch4.xls
patientrenter wrote:
Not entirely,...I'm a little more careful now when I use those terms. And previously I would have dismissed the distinctions. So that's one convert.
mp, "Does that make me old enough?"
Damn your Old mp.
What Dinosaur did you ride to school.
mp wrote:
We didn't have them. Honest to god, they used hand punches.
But I have cranked a Gestetner in my time.
patientrenter wrote:
They also tend to discount the unintended consequences of what tends to lead to anything in particular.
One always has to realize that, when one has been misunderstood as a whole, it is not possible to correct a single misunderstanding. (ht Nietzsche)
I keep thinking.. 'Policy helped postpone the greater depression by kicking the can down the road with effective wallpapering over the systemic problems*'
~splat
edit: I'm sure there are a lot we could list...
sportsfan wrote:
The middle class was blue collar, working class. At least until 10 years ago.
And we all work, at some level.
mp wrote:
Anyone older than me is old enough. dryfly is still a kid in our world, but a smart kid. He could go places.
Bad Dawg Bobby wrote:
We didn't have dinosaurs then. We walked.
patientrenter wrote:
It is and we are generally on the opposite side of it - I could care less about 'prices' per se - they are a factor of both fundamental supply/demand AND of inflation/deflation [money supply & velocity]. Impossible to untangle those two completely.
For example it is very possible to have prices of some goods increasing in a deflationary environment IF demand is fairly inelastic for those goods [like say for food & medicine & energy] but supply is collapsing because the system is imploding due to a deflationary spiral. In the 'long run' one would expect the increasing prices would draw in resources to re-start production & re-stock supply but that might not happen quickly or even at all IF the production capacity is terribly damaged and the start up & entry costs high. Supply of those necessary goods will be falling faster than the money supply and prices will actually be increasing even as money supply & velocity crash.
If you understand that paragraph then you get what Faber is worried about.
Got work to do tomorrow.
alex black wrote:
I tend to be ascetic, too. But I like my ac and heat and mobility, so I am not giving up on energy. I am just anxious to get it more sustainably and domestically.
Perhaps he will buy them for pretty cheap. But what made me shake my figurative head was the willingness to just throw all of the old stuff out and then spend that money on replacements. Even the 13 year-old thought that he was foolish (and he's the one who instigated the conversation after we left the store).
This is where Alex Black's "Amishness" comes into play.
josap wrote:
.....and secondly, they need to get past the "20-years ago, the Demos/Repubes ruined America with (fill in blank)"......We've learned nothing from GD1 and are repeating the same mistakes hoping for a different conclusion. I'm hoping this doesn't include an additional war. As it is, we'll be tied up in Afghanistan longer than the Soviet Union was 20-years ago, and the next one might start and end here and consist of mostly our citizens fighting each other - another 'not ever learning' experience....
Citizen AllenM wrote:
We may be poor, jobless, and eating cat food, but damn it, we'll do so in front of a bigscreen HD teevee watching the most expensive form of entertainment that our high bubble culture has ever managed to produce
mp wrote:
Rings a bell...
When I started out surveying, my party chief had a log rythem book. He didn't need it but he was just learning how to use a pre programed calculator. We learned solar shots together. My first mentor!
In Engineering.
dryfly wrote:
Dryfly, as per his usual, is firing on all 16 cylinders.
patientrenter wrote:
As I said, this is aggregate government speak likely hugely influenced by energy prices. I posted from here.
Individual household [consumption expenditures] going from 2000 - 2009 like this is not small. This is very significant!
317,328
309,054
305,953
301,841
302,975
300,531
294,943
297,782
296,932
291,737
Black Star Ranch wrote:
Time to start shrinking the empire.. The Brits were force to do it, so will we.
~splat
dryfly wrote:
Hmmmm....you don't by chance have one of those sitting in your garage getting dusty, do you?
mp,
Tell me more about this window of opportunity. Do you mean not enough stim the first go round and no political will for more now? Real earnest question -- wondering if I missing something in your comment.
I am seething at the hubris. The only cure is more hubris of my own.
The US Federal deficit is $1.47T. US GDP $14.7T. So borrowing 10% plus interest from the future bought us a supposed 6.5% additional GDP for a negative ROI. Maybe the intervention money was a different color than regular deficit spending. In that case neutral ROI. Was it worth it?
Okay now my real beef. Assuming that not bailing out the banks would depress the general economy. How would that work? Presumably because failed banks wouldn't lend to... oh wait. Never mind.
G'night folks. After last night's BS session, spent way too much time up and online looking at 529 plans and college funding stuff.
Educational tonight, however.
Thanks.
patientrenter wrote:
Move here to San Francisco. 70 degree high in summer, 45 degree low in winter. you just need fleece for the changes. And you can be anywhere worth being in 15 minutes by public transit.
But the social mores aren't exactly ascetic here.
Hackman wrote:
Krugman, as well as a number of others, wrote about this during the early '90s in connection with Japan.
If you do a Google search on Krugman and deflation, you should find a hit for a paper he wrote while at MIT. In fact, they still have his stuff online there.
He goes into more detail than you'll ever want to know.
RE, "This is very significant!"
Where did you get those #, Please post.
dryfly wrote:
Heh.. I've got some CRT yokes from 1983, 'made in the USA'. Course the kids will soon be saying "WTF is a CRT ?" and who'll even know what magnetic deflection even is... sigh
~splat
Citizen AllenM wrote:
Sure, until they "Colorize" it into 3D...
@Hackman
DEFLATIONARY SPIRALS
Japan is aging- and really old folks don't spend any money on anything past medicine, food, and basic household expenses. They can't use the fancy cellphones, and don't generally care about anything to do with fashion, consumption, or style.
That is true stagnation, where your over 65 population is fast growing, and sitting there doing nothing much.
Just like here- the over 80 population slows waaaaaay down.
Keep that in mind when you contemplate golden oldies.
Someday this war's gonna end...
Blackhalo wrote:
I hate 3D, you can't make up for s
t movies by throwing some lame "coming out of the screen' crap at you.
This will be a fad that I will be so glad when it's dead and buried.
~splat
RE wrote:
The delta in that series from beginning to end is more significant, RE. But:
Bad Dawg Bobby wrote:
The links are in my posts.
Citizen AllenM wrote:
They help stimulate health care like nothing on earth. Spending a few mill per oldie to squeeze out 3 or 4 extra years.
~splat
Rob Dawg wrote:
What Colour are your bits? - Ansuz - mskala's home page
A very good read, particularly in view of the Blu-Ray discussion.
alex black wrote:
LoL! Alex, that's a tough climate compared to what I am most accustomed to - Newport Beach, California. So SF probably wouldn't be my post-energy refuge. But it's not a bad place.
patientrenter wrote:
Then check this one out.
Family Income and Expenditure of All Households (2000 - 2009)
Income All households
508,984
496,983
488,115
478,096
482,490
473,260
476,159
480,074
486,805
464,649
That is REAL deflation right at home. This is real and cannot be wished away. Decline in incomes for everybody and therefore much lower consumption per person. Deflation at its best!
I would like to see that.
splat wrote:
Only in the USA is that common. And we still die younger than the Japanese.
Rob Dawg, "Okay now my real beef. Assuming that not bailing out the banks would depress the general economy. How would that work? Presumably because failed banks wouldn't lend to... oh wait. Never mind. "
Because if we didn't bail them out ..............THEN.......Waterfall (!)
We are in much better shape now.
I guess I'll have to read their paper, because I don't see much that has truly been fixed.
OTOH, the public debt sink hole that became a concern during W's two terms is now expanding at such a rate to collapse the entire country.
What did we get for this money? Not jobs, not improved J6P balance sheets, not even a new energy plan. No, we get rich bankers, corrupt & opaque government, and moral hazard writ humongous.
patientrenter wrote:
But our misery and depraved health condition supports a lot of high-status, high-paying jobs.
TJ and The Bear wrote:
patientrenter wrote:
So how much AC and heat do you need? Mobility I can see - I've had lots of tenants who moved here from Newport Beach - and they ain't never goin' back. Apparently your town breeds a lot of art students/rebels.
Thanks mp. Figured there was a lot more to that comment than I saw on the surface. I'll check it out.
RE wrote:
Lower household income is not deflation, RE, if it leads to lower real consumption. Deflation is defined as lower prices.
Suppose I live on an island with a 10-person hippy group that lives on coconuts, and we harvest 20 coconuts per day, two each, which we exchange with each other using seashells, exchanging one shell per coconut. Now suppose we all get lazy, or sick, and we harvest only 10 coconuts per day, consuming one each, and continue to exchange them at one coconut per shell. Have we all just experienced deflation? No. We have experienced income loss and a reduction in consumption.
Rob Dawg!
Tell me how many properties you've bought down by the sea, since values are surely going to skyrocket!
patientrenter wrote:
Deflationary for China, at least.
Hackman wrote:
My pleasure.
patientrenter wrote:
It is not. Most definitions are really a lower money supply. But in this context, lower expenditures and lower incomes are the perfect reflection of deflation. You are trying to escape with a technicality.
patienrenter
is CR/HCN popular in your circles?
sportsfan wrote:
LDS Church busy building more Ward Houses, Stake Centers & Temples?
RE wrote:
Yes, damn it, yes!
RE wrote:
Is so, neener, neener.
I appeal to the omniscient wikipedia.
Inflation - Wikipedia, the free encyclopedia
"In economics, inflation is a rise in the general level of prices of goods and services in an economy over a period of time."
Sorry if my attention to precision in language appears pedantic. My excuse is that sometimes precision is useful.
alex.."Apparently your town breeds a lot of art students/rebels. Newport Beach."
alex you clearly have know idea about Newport Beach.
YouTube - Bruce Hornsby - The Way It Is (piano and drums)
sportsfan wrote:
.....Utah was lower than Nevada re. Stimulus monies received (50th and 51st).......who would be paying for these projects - the church?
EvilHenryPaulson wrote:
Dunno, EHP. In real life, I am an insider. So it's not healthy for me to mix the two worlds.
TJ and The Bear wrote:
I care not a whit for appreciation. Positive cash flow is the bone I'm chasing. I'm also picky. I'm still waiting for the capitulation sale perhaps as early as this fall.
patientrenter wrote:
That definition is more a nod to J6P's understanding of inflation as oft-reported via the CPI.
Rob Dawg wrote:
Ah, Dawg, I was trying to draw out your opinion of the pending name change, which (by all reports) will turn the local beach town into Malibu north.
Bad Dawg Bobby wrote:
I only know the early 20-something kids who keep moving to SF from Newport Beach and rent from me. I assume they're not the typical resident, or they wouldn't be fleeing. And mocking.
Of course, lately after they finish their Art Masters, they can't find a job, and tail between legs, have been moving back in with the parents in NB.
Black Star Ranch wrote:
That's what I assumed. The conversations didn't progress very far in that context.
Okay, my personal comment. The folks there are not just homogeneous, they're all socially awkward.
But they seem to be happy with their lives. So, who am I to criticize. . . ?
Black Star Ranch wrote:
It has been a number of years since I lived in SLC but as I recall the Church did own most of the property directly surrounding temple square and seemed to have an interest in acquiring any it did not own. Downtown SLC is not the large, it wouldn't take much to acquire most of it.
patientrenter, RE
I think you're both right
The open question is how you compose an inflation index as quality/quantity/variety of purchases change
Even for a commodity like fuel. Is it proper not to account for the smaller amount of fuel necessary when engine efficiencies used within the economy significantly improve
Conversely when people try to use hedonics to the point where they discount the price of technology to the point where there is nothing available on the market at all for the price they are counting on
sportsfan wrote:
Sounds a bit like Japan.
patientrenter, "So it's not healthy for me to mix the two worlds."
Be careful, get so lost in yourself , you miss the move(!)
TJ and The Bear wrote:
You have my permission to keep your own unique definition of what words mean. It may be hard for everyone to understand you with precision, of course.
"It means whatever I say it means!"
--White Queen, 'Alice in Wonderland'
alex black wrote:
TJ and The Bear wrote:
Did you read the alternative suggestions? Hillarious. Oxnard IMO is a potential defaulter. They are aggressive off the books types. If they miss a payment due to the State budget troubles their street lease-back scam could blow up. Likewise their practice of shuffling funds internally is likely to get them in trouble.
sportsfan wrote:
Umm, I've been told they have an inferiority complex vis a vis Californians, so that might factor in.
Edit: Also the less homogeneous types aren't typically the upper levels,...did you go to the Costco off 54th? Plenty of Asians in there.
sdtfs, dunno.
Just wasn't there long enough to get any deeper.
Like I said, they seemed happy . . . or was that just being content . . . just dunno?
sdtfs, "sportsfan wrote:
The folks there are not just homogeneous, they're all socially awkward.
Umm, I've been told they have an inferiority complex vis a vis Californians, so that might factor in."
Keep that in mind should you venture up in the Cascades. Shit for brains assholes (!)
EvilHenryPaulson wrote:
I appreciate those aspects of different methods to measure price levels, and the potential for distortions and all. I just don't like going with the flow that the actual definition of inflation or deflation isn't the rate of change in general price levels. Like I say, years of loose language, and discussions of drivers of inflation or deflation that confuse the (money supply etc) drivers with the (price level) results, has led many people to forget the actual definition.
Anyway,
patientrenter wrote:
LOL. The "economics" meaning relates to monetary value (as affected by supply), not prices.
Rob Dawg wrote:
No, heard about it on the radio. You have a link?
sdtfs wrote:
Did not see many Asians. Did see more Hispanics than I expected.
I think Gladys Knight was the only black person there. (Yes, that's my lame attempt at a joke.)
A bratwurst with mustard and a beer would be really good right now.
No bratwurst, but the beer problem is solved.
Memo to Mrs mp: Stock up on bratwurst.
TJ and The Bear wrote:
Some residents reject idea of renaming Oxnard » Ventura County Star
Oxycontinard.
That's great. A guy with the Fed and the same economics department that gave us BB on his resume and someone from one of the ratings agencies that spent the past 15 years smoking
and collecting 
for spending five minutes a day with a big rubber 'AAA' stamp now assures us that it really, really was an emergency and throwing trillions at the likes of Jamie Dimon was the right call. I'm sure we all feel better now.
In Fresno County, unemployment inched up slightly to 16% in June from 15.9% a month before while Kings County went from 15.3% to 15.9%. Madera County unemployment rate fell slightly to 14.8% from 15% while Tulare County had 15.8% out of work, up from 15.5%.
TJ and The Bear wrote:
I am always curious where this stuff comes from. Do you have a link to a source? There must be at least one webpage in the world with the word "economics" on it that has your definition.
It seems to me, many of our giant homes will house multi-generational families both related and un........welcome to the 21st century solution to Medicare shortages - all convalescent care performed by family providers in-home..........it's the way it should be.
My fat cat friends, Listen to my heart break..as she turns away and runs away?
YouTube - Bruce Hornsby - Mandolin Rain
greenchutes wrote:
Keep putting up numbers like that and we'll be calling them Inland Empire North.
.
sportsfan wrote:
My wife's Utahn in-laws are Hispanic and there was plenty of diversity in the Bayou Brew Pub in downtown SLC on the 4th of July (I'm the designated driver when they go out) but I don't know about the general impression.
Note: For you beer drinkers it's supposed to be pretty good, they've got quite a selection.
Main Entry: in·fla·tion
Pronunciation: \in-ˈflā-shən\
Function: noun
Date: 14th century
1 : an act of inflating : a state of being inflated: as a : distension b : a hypothetical extremely brief period of very rapid expansion of the universe immediately following the big bang c : empty pretentiousness : pomposity
2 : a continuing rise in the general price level usually attributed to an increase in the volume of money and credit relative to available goods and services
I think MW strikes a nice balance with that one, although no "e" word.
When I think Utah, I definitely think
... Much as when I think Zandi, I think "insightful economic analysis".
TJ and The Bear wrote:
"Inflation is always and everywhere a monetary phenomenon."
---Milton Friedman
YouTube - SCTV 3 Dr Tongues 3D House of Stewardesses
sdtfs wrote:
Ate at the Red Rock Brewing Company in SLC one night and felt comfortable there.
The waitress was, well . . . awkward. (I'm just having too much fun with this.)
Milton Friedman - Wikipedia, the free encyclopedia
Friedman was the main proponent of the monetarist school of economics. He maintained that there is a close and stable association between inflation and the money supply, mainly that the phenomenon of inflation is to be regulated by controlling the amount of money put into the national economy by the Federal Reserve Bank. He famously quipped that deflation can be fought by "dropping money out of a helicopter". Friedman's arguments were designed to counter popular claims that inflation at the time was the result of increases in the oil price, or increases in wages: as he wrote,
Inflation is always and everywhere a monetary phenomenon.
—Milton Friedman, A Monetary History of the United States 1867-1960 (1963)
THERE'S THAT "E" WORD!!!
Black Star Ranch wrote:
You're too old to be a starry-eyed ideologue...
Office on Aging: Elder Abuse and Neglect: In Search of Solutions
"Agnes, 85 years old, lost her husband last year. Because of her own problems with arthritis and congestive heart failure, Agnes moved in with her 55-year-old daughter, Emily. The situation is difficult for all of them. Sometimes Emily feels as if she's at the end of her rope, caring for her mother, worrying about her college-age son and about her husband, who is about to be forced into early retirement. Emily has caught herself calling her mother names and accusing her mother of ruining her life. Recently, she lost her temper and slapped her mother. In addition to feeling frightened and isolated, Agnes feels trapped and worthless."
mp wrote:
Damn, mp, beat me to it!
Awesome, we avoided another Great Depression.
So did Germany during the '30s.
TJ and The Bear wrote:
Thank you.
Inflation = "a continuing rise in the general price level"
What causes this inflation thing? Well, it is "usually attributed to an increase in the volume of money and credit relative to available goods and services".
Like I say, a confusion between a thing and its assumed cause. It's like confusing a gunshot and a gun.
TJ and The Bear wrote:
Oops.
W.C. Varones wrote:
"Gentleman, you have come sixty days too late. The depression is over."
- Herbert Hoover, June 1930
ghostfaceinvestah wrote:
Yeah but their final solution got them 10 years. I don't think we get that long.
Bob Dobbs, that's a bad situation, but one being repeated all over the country.
Just add that the college kid won't find a job and you have three generations SOL.
I agree that inflation is a change in price
I agree that Japan's Consumer Price Index has had low inflation with just flickers of deflation
Beyond that, there are several ways to measure changing relations relevant to any given actor, and I do hesitate to ascribe meaning from a CPI to the economy or asset values... the understanding or knowledge flows only one way even with an honest index
greenchutes wrote:
sdtfs's comment led me to google brew pubs in SLC (a friend of my son's is the brewmaster at one of them).
The Wasatch Brew pub has a brew called "Polygamy Porter" with the label sub-title being "Why have just one?"
Bob Dobbs wrote:
LOL.....they all seem to come back home when they're hungry......and the chores will still be here for them as well......
mp wrote:
Have we found the ultimate source of the problem?
Milton Friedman's famous thesis was that inflation has only one cause - money supply/velocity. He still defined inflation as an increase in the general level of prices. Otherwise, his thesis has no meaning (see the definition of tautology).
picosec wrote:
My wife gave me the T-Shirt. But they do love their micro-brews. Must be some sneaky way to get around the weird liquor laws.
EvilHenryPaulson wrote:
Oh, sure, I hesitate on all that analysis of cause and effect, too. I just want to make sure I know what I am talking about before I do the analysis.
patientrenter wrote:
Friedman's quote is apt, though, as prices can increase or decrease temporarily due to non-monetary influences, but overall they do not broadly march upward or downward without it.
sdtfs wrote:
......isn't it all 3.2 beer still? The kind they sold on-base at the enlisted clubs?
TJ and The Bear wrote:
Most people with any knowledge do ascribe to Friedman's theory of the causes of inflation, to at least some extent.
People are catching on to how flawed the CS index is. the power of the internet.
Housing markets: Up again | The Economist
First, index values are computed as a three-month moving average, and so May prices reflect the average of transactions in March, April, and May. These are also closed sales, with contracts concluded a month or two prior to May. Why is this relevant? Because the price data is based entirely on transactions originated before the government's housing tax credit expired. Most other housing market variables were also rising before the end of the credit, only to tumble back after its expiration. So the index will likely turn down in the months ahead.
Black Star Ranch wrote:
Had 3.2 clubs when I was a late teen in Colorado. Loved those places, especially on "Drown Night".
patientrenter wrote:
No one can claim that - our fiat experiment isn't even 40 years old. Least of all old man Milty (or, rather, his wife, who was the brains of the operation).
patientrenter wrote:
Are any of those people NOT part of the commentariat?
Austerity For The People!!!!
Beneath the thousands of teacher layoffs are stories of uncertain futures for Inland families | Local News | PE.com | Southern California News | News for Inland Southern California
Have a good nite, All........be safe.
If we have general price indices, should we have a general one for investment assets net of fees? RE, mutual funds, bonds, stocks, etfs, 401ks
TJ, "Are any of those people NOT part of the commentariat? "
Millions.
It was a BIG experiment.
I think I may have to reuse that one.
ghostfaceinvestah wrote:
Good question. I, for one, am getting tired of all these backward looking numbers.
Guess I never would have made a good economist.
Austerity For The People!!!
Layoff talk portends storm on Galveston Island | Houston & Texas News | Chron.com - Houston Chronicle
Black Star Ranch wrote:
Bingo! They had one beer listed at 12 percent! That's probably a selling point
EvilHenryPaulson wrote:
GAWD no!!! People would realize that FIRE burns them! Can't have that!
If your CFA throws in a shoulder rub, would that be a hedonic deflator?
Kauai_Kahuna wrote:
I'll have yours... and your's and...
ghostfaceinvestah wrote:
Yeah, Inland Empire South isn't doing so well either.
ghostfaceinvestah wrote:
" Who knew we'd save prisoners, banks and car dealers over teachers?"
Kauai_Kahuna wrote:
I helped my BIL design his "cooler", fifty feet of 3/8 inch copper tubing, for his first foray into home brewing.
Bob Dobbs wrote:
Now, that's just downright depressing, . . . all the more so because it's so true.
Bob Dobbs wrote:
" Who knew we'd save prisoners, banks and car dealers over teachers?"
TEACHERS HAVE not PERFORMED.
Your doing OK. Look around you.
Bad Dawg Bobby wrote:
OTOH, your spelling could use some additional teaching.
A general investment return index would be:
- easier to measure
- more relevant to storage of wealth as the rates of return are normally a multiple of price indices
- more significant to the economy because assets are so much bigger than one year's GDP
- current market indices do suffer survivor bias and neglect the cost of fees which are significant and varying, they are also not reflective of median returns
sdtfs, I use a chiller plate for two lines for parties, at home I had to go with a 4 tap keggerator, but I spoil myself.
Bad Dawg Bobby wrote:
It's a broken system. Even the best are shackled. There are saints who prevail. But it's a pretty sad setup that only works with saints. Try making a law firm work that way, or a fire department...
I've been there, and I've seen it.
I hope Jas is alright. Big fire at Tehachapi. Dozens of homes destroyed, hundreds threatened.
TJ and The Bear, " Bad Dawg Bobby wrote:
Your doing OK.
OTOH, your spelling could use some additional teaching. "
Don't blame my teachers, trust me .....they did the best they could.
The thing about a sows eat.
That teacher story just confirmed what Elizabeth Warren has been saying. People just can't make it on one income, even if it's a decent job like a maths teacher. $1000 on childcare? WTF? And they have a house big enough for the mother and four kids. I don't want to come across as a hard ass, but people are going to be getting used to less.
I understand deflation to mean less money floating around. In our case, it is stuck in the banks, stuck in companies' balance sheets, and not out in the economy where it should be. Only US investment will create the jobs needed to funnel that money into the real economy.
In contrast to what we actually need, there's a chart floating around that shows the secular rising trend in free agents (versus regular employment) since the 80's. I bet that employment as we've known it isn't really coming back.
Jonathan wrote:
No, it's not.
It's not politically do-able.
jonathan, "In contrast to what we actually need, there's a chart floating around that shows the secular rising trend in free agents (versus regular employment) since the 80's. I bet that employment as we've known it isn't really coming back. "
I think you are right. I think there is not only less money floating around but less cash.
Deflationary, Inflation?
What?
No one has had CONTROL over this economy since............Kennedy and then I'm just "wishful thinking"
mp wrote:
You could've left it at simply "It's not doable".
Someone earlier stated that people have to accept we're not going back to "2005 normal". Hell, we're not even going back to "1995 normal". We may have an outside shot at "1985 normal"...
From up top - you don't want to hold cash at the end of catastrophic deflation. It's good to have just before you hit bottom though, then it's all hard assets.
So the bad news is that you probably can't depend on holding onto two middle-class incomes. These are the guts of the story.
So how do you break that to the American people? If these folks could just pare right back on expenses, sure some are toast, but many of them could make it as 'lower middle-class' and scrape by avoiding bankruptcy.
How do you communicate the need to downsize? By example of your neighbors?
Speed wrote:
I would agree with that.
gawd D
CR, your forecasting standards are mightly low!
Jonathan wrote:
Keeping down with the Joneses?
OMG, first comment, not only on topic, but rockin it! Go CK!
Losing the jones to keep up?
Regarding the prior topic... CR sees the homeownership rate going to 66%, but the chart screams 64% to me. Anyone else?
Austerity
For
The
People!!!!!!!!!!
Polk School Board Officials: Layoffs May Proceed Before Voting on A Property Tax Increase | TheLedger.com
it whispered 64.7 to me...
More like 46% - the graph really needs to go back to WW1.
Jonathan wrote:
mortgage & health care are probably the largest expenses. How do you cut back if you can't sell the house or find lower priced health care?
Jonathan, "How do you communicate the need to downsize? By example of your neighbors?"
A member for 4 years and 14 weeks and you seem to ......................Young.
I've got your lower priced health care right here...
I just posted a book recommendation: The Working Poor: Invisible in America (David K. Shipler)
edit...first post worked much better. DUH!
Wall Street gambled and lost, so of course, everyone else needs to cut back to make them whole again.
“There's class warfare, all right, but it's my class, the rich class, that's making war, and we're winning.”
-Buffett
Speed, "From up top - you don't want to hold cash at the end of catastrophic deflation. It's good to have just before you hit bottom though, then it's all hard assets."
I feel for my RICH brothers.
Fuck You!
TJ and The Bear wrote:
I keep thinking about the guy I knew in the 90's who inherited a house free and clear, plus 100K cash. After blowing through the cash, he mortgaged the house. I'm guessing he re-fied every chance he could. He seemed like a fairly normal type; 66 or 64, I don't know if those numbers really mean anything.
We could use some anger, outrage. Everyone is being so civil about the biggest robbery in history.
Watch people get angry when 4% hit the 99 week limit on benefits.