Quote :

"The private sector doesn't give a fuck where spending comes from, whether it's from wages or from government spending doesn't matter at all to their bottom line."

We just ran that experiment. The government increased spending dramatically and unemployment just got worse. It seems the private sector cares deeply where spending comes from.

[Edited on August 17, 2011 at 12:51 PM. Reason : .,.]

8/17/2011 12:49:21 PM

The spending undertaken was far less than any liberal economist was saying would be necessary. As a result, we saw unemployment stabilize (rather than keep increasing, as it had been) and stall out as the spending dried up. The only people who thought the stimulus was actually what liberal and Keynesians thought necessary are conservatives, because as usually they don't even know what their opponents are saying, let alone how to refute it.

8/17/2011 1:25:40 PM

You know what we need? Another war...a big one. That would really get the economy going again!

8/17/2011 1:55:47 PM

^ Preferably with space aliens, according to Krugman.

^^ We spent enough to get the nation's debt downgraded and yet we find ourselves in the deepest and longest recession since the great depression, the previous time we tried to spend so much.

I'm sorry, every shred of anecdotal evidence is against you.

More debt is not going to fix a problem caused by excessive debt. The federal reserve needed to run the printing presses, no doubt, but government spending in no way facilitates that behavior.

8/17/2011 2:07:14 PM

Quote :

"The spending undertaken was far less than any liberal economist was saying would be necessary"

no, the spending wasn't actually focused on job-creation. It was focused on democrats pet projects that they hadn't been able to fund with an R in the white house. Had they put 700billion straight into infrastructure (which is what we were sold the stimulus would be), it might have had an actual effect. And now, what do we hear the liberals saying again? Oh, we need more infrastructure spending... WHY THE FUCK DIDN'T YOU DO IT 2 AND HALF FUCKING YEARS AGO WHEN YOU HAD THE GOD DAMN CHANCE TO DO THAT?

Quote :

"What? The lower class puts almost 100% of their income into consumption. The ultra rich mostly invest and save it. Are you fucking stupid or insane or both?"

yeeeeeeep. the ultra rich don't spend any money at all. ever. yep.

Quote :

"He doesn't just "want to pay more taxes". He thinks people in his class pay too little in taxes and it's bad for the country. If he just paid extra taxes himself, he'd drain his pockets, not make so much as a dent in the debt, and end up accomplishing absolutely nothing as Washington continues to tax the rich less than he believes they should. It'd be the most pointless gesture in history."

No, it wouldn't be pointless. It would give him a platform to stand on. When Bill Gates tells me I should be charitable, I believe him, because he spends a shit ton of his money on ostensibly charitable things. When Warren Buffett tells me the rich should pay more in taxes, I don't believe him, because he does everything he can do to avoid taxes. If he REALLY thought he should pay more taxes, then he would be fucking doing it already.

8/17/2011 5:55:40 PM

Quote :

"The spending undertaken was far less than any liberal economist was saying would be necessary"

It's not just that. It's the idea that they make these "guesses" based on models that over and over and over again show to be terribly bad at predicting outcomes to acceptable ranges.

Here is one example:
http://krugman.blogs.nytimes.com/2009/01/06/stimulus-arithmetic-wonkish-but-important/

Feel free to try and contort reality to show how Krugman was right and then we'll correct you.

8/17/2011 6:15:57 PM

Great article (minus his plug for Rick Perry, though not a favorable one by any means) by Matt Taibbi of Rolling Stone discussing why progressives/the American left are way, way behind on monetary policy:

Quote :

"The reason QE is “good for the rich and bad for the poor” is obvious: by pouring trillions in jet-fuel cash into the inequity engine that is the banking sector, we’ve seen massive increases in share prices and corporate profits, without any resulting increases in wages."

Quote :

"It should be obvious to anyone that printing two trillion new dollars and handing it to the corrupt financial sector to play with will not result in higher wages for ordinary people. This ought to be an issue for the left/progressives, but thanks to Barack Obama’s ownership of the program, it’s now turning into a campaign issue for Republicans. Most notably, Texa-creep Rick Perry came out recently with a uniquely thuggish criticism of QE, essentially threatening Bernanke with a Texan mob if he does what everyone expects him to do and enacts a third QE program:"

Quote :

"To me this whole issue encapsulates the basic failure of the Obama administration. It has surrendered to Wall Street interests, and in doing so has allowed lunatics like Rick Perry to step into legitimate roles as critics of corrupt policy."

http://www.rollingstone.com/politics/blogs/taibblog/rick-perry-vs-ben-bernanke-round-one-20110816

[Edited on August 17, 2011 at 7:03 PM. Reason : ]

8/17/2011 7:03:18 PM

clearly, the way out of our economic stresses is to tax the poor:

http://video.cnbc.com/gallery/?video=3000039206

8/18/2011 12:20:17 PM

http://finance.fortune.cnn.com/2011/08/18/how-washington-is-destroying-the-economy/?iid=HP_LN

Reasonable article by a reasonable analyst putting the blame squarely where it belongs (the Tea Party) and explaining how our problems are eminently solvable if the children in Washington would focus on solutions instead of just creating more problems.

8/18/2011 2:00:00 PM

He writes this:

Quote :

"Adding to the current sense of foreboding, at least for me, is the fact that the Federal Reserve, which rode to the rescue last time, is legally constrained by provisions of Dodd-Frank legislation little recognized outside the world of regulators and financial techies. Back in 2007, the Fed could invent programs to bail out solvent but illiquid institutions. It could also turn investment banks like Goldman Sachs and Morgan Stanley (MS) into bank holding companies with access to unlimited Fed funding -- and even infuse cash into nonbank basket case AIG (AIG) directly and indirectly to forestall an uncontrolled collapse, which could have made the Lehman Brothers disaster look like a mere rounding error. The Fed's actions had their own set of problems, which I've written about at length. But once the Fed began acting in the summer of 2007, you knew there was an institution around that could bail out the world, if needed. Now, at least in theory, the only government institution that's supposed to do this kind of thing is the Federal Deposit Insurance Corp. I respect the FDIC, but it's got nothing like the Fed's power and international clout. We've got this problem because our leaders rolled over to pressure from big companies instead of breaking them up into pieces small enough to be allowed to fail."

So, his problem is that the Federal Reserve is restrained by Dodd-Frank (lol). This guy is a complete doofus. Throughout the entire article, he never touches on any of the structural problems with our economy, until he talks about the Fed...and then gives them a pass and doesn't mention interest rates.

Another hit piece on the amorphous "Tea Party" masquerading as actual analysis. Cool.

8/18/2011 2:19:26 PM

What structural problems? None of those problems were problems until global investors decided to dump a bunch of money into the mortgage industry that was exploited by crooks. Crooks that were allowed to create a $2 trillion market of toxic securities by an administration that simply didn't care as long as everyone involved was making money. When that market eventually went boom in 2008 when those investors and crooks realized the jig was up and cashed out, the only thing that saved the rest of us from losing everything we had was the Fed. Now instead of actually tackling the problems that led to Fed having to save all our asses, the Tea Party wants to just destroy the whole system, put more money into the hands of the people that caused this mess in the first place, and sit back and hope they don't fuck us all over again. Yeah, that makes sense.

Please don't try and rewrite history. I'm not a Fox News viewer, I actually paid attention to the events of the past 3 years.

[Edited on August 18, 2011 at 3:13 PM. Reason : :]

8/18/2011 3:08:53 PM

Quote :

"yeeeeeeep. the ultra rich don't spend any money at all. ever. yep."

I think you misquoted, there's nothing in that post that says the rich don't spend any of their money?

8/18/2011 3:09:52 PM

Quote :

"What structural problems?"

Bro...you serious, bro?

-Zero percent interest rates being sustained over many years
-A housing bubble created by low interest rates in the early 2000s, and a resulting glut of housing that still hasn't cleared from the market
-A health care insurance model where health care is almost never paid by the consumer, and almost always paid for by the insurance company or the government, wildly distorting prices
-Inflation in both food and energy
-A world reserve currency that is quickly losing confidence among creditors and will be replaced within the next two decades
-A labor market completely wrecked by burdensome regulations
-A manufacturing industry on its last limb, and an increasingly service-sector dominated economy

And that's just a start. I could go on. The fact that you actually think our current situation can be blamed on "The Tea Party" (whoever the fuck that is) proves, beyond a shadow of a doubt, that you have bought into the partisan dog and pony show.

Democrats are not looking out for you. Republicans are not looking out for you. They are all trying to stay in office and will fuck the American people as hard as they need to in order to do that. Get your head out of the sand and recognize that we are living in a true kleptocracy.

[Edited on August 18, 2011 at 4:11 PM. Reason : I ALMOST FORGOT, WE HAD TO DESTROY THE FREE MARKET TO SAVE IT]

8/18/2011 4:07:13 PM

Cool, and exactly which of those problems would have been solved by not raising the debt ceiling? Which of those problems would have been solved by defaulting on our debt? How could either of those things done anything but make things worse? How can you possibly say that the Tea Party wasn't culpable in hindering any progress towards fixing those problems by distracting us with a completely unnecessary fight over what has historically been a procedural vote. How can you say that the GOP as a whole wasn't culpable when all they've done since blacky mchussein osama has taken office is say "no" to every single attempt to actually tackle any of those issues?

8/18/2011 4:34:04 PM

Quote :

"Cool, and exactly which of those problems would have been solved by not raising the debt ceiling?"

The point of resisting the debt ceiling increase was to seriously address our spending problems. The GOP didn't do a good job of that, but neither did the Democrats. No politicians are really talking about cutting where the cutting needs to be done.

The only thing raising the debt ceiling did was prolong the inevitable. It's more of a debt "target" than anything. If the politicians know they have money to "spend" (read: borrow), they will spend it. I mean, honestly, what in the fuck is the point of having a debt ceiling? It's been raised over 70 times. That's completely useless. Let's just destroy the currency already and start over.

8/18/2011 4:47:45 PM

Quote :

"The point of resisting the debt ceiling increase was to seriously address our spending problems. "

How can you say this? There was a deal on the table that cut our deficit by more than 4x what the bill that finally passed did. It included cuts to everything, including SS and Medicare. Of course, it also eliminated the Bush tax cuts, subsidies on things like corporate jets, and loop holes in our tax code. All things the Tea Party and the rest of the GOP resisted to the point where Boehner literally stood up and walked out of the room. So they had to pass this farce of bill that doesn't really address anything. Their actions simply don't jive with what you say their motives were. If they really cared about anything but getting Obama out of the White House, they wouldn't have done what they did.

And yeah, I agree that the whole concept of the debt ceiling is retarded. Who do you think created the need to even vote on whether or not to pay our bills? It wasn't democrats. It also has no bearing on how much money we plan on spending, that's a completely different vote. It's so that we can borrow enough money to pay for the things that we already bought or planned on buying,

http://www.gao.gov/products/GAO-11-203

Quote :

"The debt limit does not control or limit the ability of the federal government to run deficits or incur obligations. Rather, it is a limit on the ability to pay obligations already incurred."

[Edited on August 18, 2011 at 5:35 PM. Reason : :]

8/18/2011 5:28:06 PM

For the most part, the GOP is just playing politics, but so are Democrats. Don't feed me this shit about cuts to future projected spending and tell me it's a cut. It's not a cut. Nothing was being cut from this year or next year, at least nothing in substantial amounts.

Sooner or later, if we don't have serious reform, the government's hand will be forced and we'll get "draconian cuts," as they say. If politicians keep ignoring this reality so they can stay in office for another 2 or 4 years, then it will get ugly.

Quote :

"And yeah, I agree that the whole concept of the debt ceiling is retarded. Who do you think created the need to even vote on whether or not to pay our bills? It wasn't democrats. It also has no bearing on how much money we plan on spending, that's a completely different vote. It's so that we can borrow enough money to pay for the things that we already bought or planned on buying, "

If the national debt is all things that we are obligated to pay, then it's actually much, much higher than 15 trillion or whatever...by a factor of 10. Our unfunded liabilities are, for the people currently alive, somewhere in the range of 200-300 trillion. So, the system is fucked.

[Edited on August 18, 2011 at 5:39 PM. Reason : ]

8/18/2011 5:34:24 PM

Quote :

"Nothing was being cut from this year or next year, at least nothing in substantial amounts."

Nothing needed to be. That's the whole point. We weren't in any sort of immediate danger of not being able to meet our debt obligations. The problem we have today is 9.1% unemployment, not public debt. People in government were trying to solve unemployment. They were trying to solve our long term debt problem too. The Tea Party said "fuck all that, we'd rather just fight about a procedural vote that has no actual bearing on anything" and literally froze progress on everything else.

8/18/2011 6:19:45 PM

In this thread Str8Foolish proves that his username is not a misnomer.


"The Shitty Beatles, are they any good? "

"They suck."


"Ah, then it's not just a clever name."


Seriously dude try reading a book not written by a Princeton economist sometime.

[Edited on August 18, 2011 at 6:32 PM. Reason : a]

8/18/2011 6:31:21 PM

Quote :

"The problem we have today is 9.1% unemployment, not public debt."

that's one of the problems. Massive debt and massive overspending is another.

8/19/2011 7:23:57 AM

Unemployment isn't really a problem, its a symptom of our real problems.

Putting people to imaginary work like Obama frequently does won't solve anything,

If we addressed our structural problems the jobs would be there.

The internet has created one of the biggest deflationary events in modern history because of the immense creative destruction. It's truly a beautiful thing, but its been hard on the lower class initially bc they are bearing the brunt of the job losses. On the flip side they should be enjoying savings on consumption from all the deflation. Unfortunately the sickos out there have decided to punish them by printing money to counter the deflation.

So they are experiencing lost wages and higher prices simultaneously. The ultimate double whammy.

And when you combine that with obamas oppression of the labor market, its really a triple whammy.

8/19/2011 8:22:25 AM

People wont have jobs wont be there until businesses create them.

Businesses wont create jobs until there is increased consumer demand.

There wont be increased consumer demand until people have jobs.


Is it really so hard for you guys to see that more government spending is *exactly* what we need right now?

8/22/2011 1:10:17 PM

Government spending is nothing more than a transfer of money from those buying government bonds to those receiving government contracts. It has no impact what-so-ever upon consumer demand.

What has stalled is not consumer demand. Consumer demand is higher today than it was before the recession. What is different today is that private investment is almost negative if you include depreciation, just as it was from 1929 to 1945.

8/22/2011 2:48:44 PM

Quote :

"Government spending is nothing more than a transfer of money from those buying government bonds to those receiving government contracts. It has no impact what-so-ever upon consumer demand."

Not true at all. If you transfer money from people who don't spend money to people who do spend money, you increase consumer demand.

Quote :

" What has stalled is not consumer demand. Consumer demand is higher today than it was before the recession."

Citation please. Here I gathered from stories like this http://money.cnn.com/2011/04/27/news/companies/walmart_ceo_consumers_under_pressure/index.htm that people were running a bit short on the stuff that creates demand, that they're pretty much already living paycheck to paycheck without affording non essentials.

Quote :

" What is different today is that private investment is almost negative if you include depreciation, just as it was from 1929 to 1945."

You admit right here that private investment is next to nothing. Yet you believe transferring their wealth to a class of people who often live paycheck to paycheck wont increase demand. Seriously is your brain incapable of relating and contrasting any two statements together or is it just a messy soup of facts floating around but never touching each other?

[Edited on August 22, 2011 at 3:07 PM. Reason : .]

8/22/2011 3:06:11 PM

Quote :

"Yet you believe transferring their wealth to a class of people who often live paycheck to paycheck wont increase demand."

I said government spending. We aren't talking about unemployment benefits here, we're talking about people that apply for and receive government contracts above and beyond current expeditures, which are the same class of people that buy government debt. So, no, transferring a dollar from paul to paul is not going to increase demand.

8/22/2011 3:19:39 PM

Quote :

" I said government spending. We aren't talking about unemployment benefits here,"

Okay, so we can agree that unemployment benefits stimulate demand then?

Quote :

"we're talking about people that apply for and receive government contracts above and beyond current expeditures, which are the same class of people that buy government debt. So, no, transferring a dollar from paul to paul is not going to increase demand."

Except a contract is work being done, investment being made, jobs being created, money being paid, thus demand created. Those people who receive contracts would otherwise be sitting on their cash and not investing, as they're doing now. You can't apply for a government contract, get it, then just sit on the money like the rest of your portfolio. It's essentially a forced investment. So of course it creates jobs, because it takes money, via taxes, from investors who'd otherwise do nothing with it, and devotes it to contracts that pay out to people who'd otherwise be unemployed.

8/22/2011 3:56:45 PM

Quote :

"it takes money, via taxes, from investors who'd otherwise do nothing with it"

Your assumption. No reason to believe it to be so. Even if all your assumptions are right, you are at best lessening the symptom, unemployment. You are at best not fixing the structural problems and most likely making them even worse, as even more money is poured into mal-investments through the government.

8/22/2011 4:11:01 PM

Not an assumption at all. Corporations have been pulling in record profits the past few years

http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm

And companies are investing less than ever and sitting on massive capital reserves

http://www.washingtonpost.com/wp-dyn/content/article/2011/03/10/AR2011031005151.html

Another rundown on the situation: http://www.slate.com/id/2289619/

It only seems like an assumption to you because you have no fucking idea what's going on and are projecting that cluelessness onto me.

Quote :

"Even if all your assumptions are right, you are at best lessening the symptom, unemployment"

Unemployment isn't just the symptom, it's a pretty key part of the cycle we're stuck in. How do you expect business to expand without consumer demand rising again? How do you expect consumer demand to rise again if unemployment stays high? How do you expect unemployment to go down if businesses don't expand?


[Edited on August 24, 2011 at 3:34 PM. Reason : .]

8/24/2011 3:32:39 PM

Quote :

"And companies are investing less than ever and sitting on massive capital reserves"

Uncertainty has caused the economic engine to slow. Continued experimentation is not going to reduce uncertainty.

8/24/2011 4:24:48 PM

Quote :

" Uncertainty has caused the economic engine to slow. Continued experimentation is not going to reduce uncertainty."

Luckily for you "uncertainty" is an almost entirely unquantifiable specter that can always be pointed to until the end of time. I offer unemployment and consumer spending, two very concrete metrics that can be pointed to and be shown to be consistent with what I'm asserting. Can you point to any concrete metric that backs up your claim that it's just "uncertainty"? I'm just proving to see if your theory is at all falsifiable.

8/25/2011 10:01:16 AM

8/25/2011 10:42:22 AM

Quote :

"I offer unemployment and consumer spending, two very concrete metrics that can be pointed to and be shown to be consistent with what I'm asserting. Can you point to any concrete metric that backs up your claim that it's just "uncertainty"? I'm just proving to see if your theory is at all falsifiable."

And I offer net private investment, a very concrete metric that can be pointed to and be shown to be consistent with what I'm asserting.

Meanwhile, your metrics are not consistent with your position. Consumer spending recovered fairly quickly, yet the recession drags on.

8/26/2011 11:02:32 AM

Quote :

" And I offer net private investment, a very concrete metric that can be pointed to and be shown to be consistent with what I'm asserting."

We both agree that private investment is low you twit, both of our assertions are supported by that fact.

Quote :

" Meanwhile, your metrics are not consistent with your position."

How the fuck so? My position is that private investors are not investing because consumer spending is low, consumer spending is low because unemployment is high, unemployment is high because private investing is low. The metrics are: Private investment, unemployment, consumer spending -- all of which are in line with my assertions, and I've provided links to back them up.

Quote :

"Consumer spending recovered fairly quickly, yet the recession drags on."

Citation, now, or shut the fuck up forever.

8/29/2011 1:36:48 PM

bump

8/30/2011 10:43:04 AM

Quote :

"Citation, now, or shut the fuck up forever."

Now will you shut the fuck up?

Quote :

"My position is that private investors are not investing because consumer spending is low, consumer spending is low because unemployment is high, unemployment is high because private investing is low"

A grain of truth is not the whole truth. Private investment takes place for more reasons than just "demand is unmet." Investment takes place for many reasons: to more profitably produce what consumers are already buying, to produce products consumers never had the opportunity to buy, to enter new markets and take existing market share from other companies, to replace worn out machines producing for existing customers. All these forms of investment have dried up on net, not just investment in greater supply of existing output. Any explanation of the economy that does not address all these forms is clearly incomplete.

As such, manufacturers are not just afraid of producing more and losing money, they are clearly frightened they are going to keep producing the same amount and wind up with losses. A complex fear to have when profits on existing production is approaching record levels. In a sense, the high profits are a product of the collapse of investment, as investment often takes the form of competition over existing consumers spending. They clearly accept that just because a business is profitable today, even on the other side of the recession, is no protection against the uncertain future. Given this, even more consumer spending and the resultant even higher profitability today is not going to change net private investment tomorrow.

[Edited on August 30, 2011 at 4:05 PM. Reason : .,.]

8/30/2011 4:01:18 PM