Perspectives on the global economic meltdown (Jan 26 2010)

arnab · Post by **arnab** » 08 Sep 2010 12:23

Neshant wrote: In order for the productive to have the option of keeping money under their pillow, it should retain its purchasing power. Since the crooked middle man industry produces nothing, its only means of income is stealing it from others - hence the need for 'promoting' inflation. Now to stop the thievery, central banking would have to be disbanded. Except that won't happen because the middle man industry's primary means of looting the people of their wealth will be gone. So there's no option for me to keep it under my pillow.

I don't need it, but I have the option of having it if I agree to trade my hard earned money for it. When I do and Apple makes a sale. Its a reward for having produced a product somebody wants to have. Nobody opts to be scammed by banking crooks. Again where's the option to sign off?

Sounds good if the whole world be put in a free market. Why just cabbies?

So to retain purchasing power the market must also ensure that it is not creating artificial demand at artificially inflated prices for products that people do not need. Then there would be no need for any sector (private or public) to ask for wage increases. If the pvt sector does its bit and stops scamming the public in general by providing unnecessary goods and services - I'm sure the banks and govt would follow suit.

If someone 'needs' to buy an apple iphone and that is not construed as a 'scam' for the only reason that it originates in the private sector and therefore the market, then surely the govt (and banks) have the right to buy / sell products that they feel is required by their 'clients'.

Sure re cabbies - but then what do you think the US feels about free movement of labour? If there is no free labour market - then there is no 'free market', so why create useless strawmen arguing that 'markets are the true determinant of worth'?

I'm afraid 'sillyness' lies not only in the repository of the 'middleman' and banks. And lobbyists can reasonably argue that they are providing a service to direct govt buying / selling behaviour that is best suited to their clients who need it (just like private sector advertising).

Hari Seldon · Post by **Hari Seldon** » 08 Sep 2010 13:15

^^^Can't help but notice that we've filled up quite a lot of space on the 'what is productive' question. I have to wonder whether the phrase 'productive segment of society' or as moi had used earlier 'the productive economy' is really all that difficult for one so obviously well-versed in economics to comprehend. Or is it some of the more usual intellectual games used to fill up online space thread after thread?

Fact remains that there is a definite element of scamming and fraud going on. I doubt anybody here denies it. Turns out that if you or I indulge in fraud-scam artistgiri, we'd have our a$$es hauled to jail. Not so the banksters, for whom the law doesn't seem to apply. The effect such inaction (and at some level, complicity by the political, academic and regulatory class in the ongoing thievery) will have on the too-big-to-fails going forward can only be bad for the mango public, IMVVHO. That is the real tragedy.

Like some wise sage once said

Loss and failure become tragedy only when the lessons go unlearned

or something like that

ShivaS · Post by **ShivaS** » 08 Sep 2010 13:48

Quote:
Loss and failure become tragedy only when the lessons go unlearned

at public expense which all tragedies are by nature!

enqyoob · Post by **enqyoob** » 08 Sep 2010 16:48

The same for your banks - they provide a service.

AFAIK, only ppl who borrow money from the Fed at 0% and from me at -10% (see "fees" for keeping my pennies, above) and then deposit it back with the Feds at 5% or give it to ppl who buy a Mercedes (i.e. themselves) at 8%, can afford to ride in taxis.

So the taxi driver's ability to deliver a "productive service" depends entirely on the banker's ripping off the Treasury and hence it is the banker who provides the useful service. As for charging me $2, may the bank President's mansion sink into a sinkhole along with his Bentley. One caused by the city sewage dump collapsing.

ldev · Post by **ldev** » 08 Sep 2010 19:46

Fact remains that there is a definite element of scamming and fraud going on. I doubt anybody here denies it. Turns out that if you or I indulge in fraud-scam artistgiri, we'd have our a$$es hauled to jail. Not so the banksters, for whom the law doesn't seem to apply

Misleading advertisements by the private sector are a form of scamming - consider the antennae problems with the IPhone 4 - what has stirred the ire of people is when government money and/or money manufactured by Central Banks is used to bail out those who scam. That has been primarily the preserve of the financial sector worldwide, hence the angst directed towards the financial sector.

Also interesting is that during the 1950s and 1960s two of the fastest growth decades for the US manufacturing sector, the top personal marginal tax rate was above 80% (somebody can google to find out the exact rate). It did not stop growth then. Today there is massive hollering at any tax increase proposals in the US inspite of the the US government spending twice what it takes in tax revenues according to some recent monthly data.

SwamyG · Post by **SwamyG** » 08 Sep 2010 20:15

I dunno - maybe if he improved the US educational system by allowing people

Yeah, heck like closing down the Public Education System, right? Let us hand over the children's future to Corporations, that will do good. After all the Corproations will start grooming the toddlers to become even stupider consumers - which in turn is good for the environment and society onlee.

to go online for job re-training and earning degrees in their spare time, etc.

I ask again, retrained and earn degrees to do what kind of jobs? huh? Oh yeah, I forgot there are plenty of jobs at Walmart and there is always this rosy high paying job of being a truck driver. Oh no, silly me, USA will be a land of million scientists all judiciously working on flexible or nano electornics. Wait a minute....everybody will be visiting Mars and Moon for Summer vacation, no. No more Cancun. So we need more fuel researchers.

Teachers and academia have become a fat, bloated portion of their system which could easily be targeted for reform and competition.

All systems have the inherent characteristic to allow incompetence and laziness to creep in, but teachers, firemen, police, health specialists already get paid poorly and are the scapegoat for anything ill with the system. Hey the bridges are crumbling, yeah it is all the teachers fault. Hey the insurance premium is high, yeah it is the academia and school administration to be blamed. Hey the college tuition is obscene, yeah it is the high school teachers. Competition? Yeah, hand over the schools to Corporations, they will run it with efficiency with an eye on bottom-line. How about an IPO for a k-6 school. Splendid. Free market, no? Lets us get blokes to buy shares of a company that is grooming kindergartens to consume 100" TV, to watch their favorite football team (i.e. if they don't have the luxury to pay $200 for seeing them in Stadium - which in turn was built by public money. Why? Because these teams bring revenue to the city, no?), sipping their favorite carbonated drink and chewing 50lb turkey leg.

SwamyG · Post by **SwamyG** » 08 Sep 2010 20:18

ShivaS wrote:Like in Shiva’s case the Ganga spouting from his head, Acharya ji did the above post spout out of your hat or there is some other source I humbly ask?

What I do in such cases is take a big sentence out from the post and run a google search. And look at the results, omitting results that actually take us back to BRF.

For example:
http://www.google.com/search?ie=UTF-8&o ... 0+years%22

SwamyG · Post by **SwamyG** » 08 Sep 2010 20:43

Outsourcing jobs does not reflect Ohio values
India could ban Coca Cola as it does not reflect its values too. I mean drinking a tender coconut is more nutritious than guzzling Coca Cola, right? While at it, India could ban Arbys' and KFC as they stand no chance against nongu

Neshant · Post by **Neshant** » 08 Sep 2010 20:46

arnab wrote:So to retain purchasing power the market must also ensure that it is not creating artificial demand at artificially inflated prices for products that people do not need. If the pvt sector does its bit and stops scamming the public in general by providing unnecessary goods and services - I'm sure the banks and govt would follow suit.

I really don't know what point you are trying to make and your messages are making less and less sense. I find it typical of keynesian economists who confuse a simple issue to the point where they themselves get lost in the chaos.

If you don't want an iphone, you have the option to not buy it. A good/service cannot be unnecessary if people are willing to pay for it because they derive utility from it - be it entertainment, education, productivity enhancement..etc.

By contrast, there is no option but to pay for gold plated public sector pensions for the life of that person's retirement which in some cases is longer than the person worked! I cannot opt out of it, i sure as hell get nothing but poorer by paying for it. I cannot strike and not pay my taxes unlike the public sector which can strike and not work in leiu of salary/pension demands. I cannot get a gold plated pension plan myself and have it paid for by some sucker. I cannot refuse to pay for services I've never used. If I do any of the above, I go to jail. That is servitude.

arnab wrote:then surely the govt (and banks) have the right to buy / sell products that they feel is required by their 'clients'.

They have a right to sell stuff. They don't have a right to force me to eat their gambling losses. Nor the right to piss away my earnings through counterfeiting of money. How do I opt out of that?

Sure re cabbies - but then what do you think the US feels about free movement of labour?

It surely can't be any worse than the free movement of taxpayer's money to make good the losses of banking crooks.

For at least in the free movement of labor scenario, one gets a useful service/good at a lower price even if one earns less as a result of such a system. In the free movement of bailouts, there is no useful service provided, and yet I earn less by having to paying for a banking crook's gambling losses via taxation, printing, inflating, bailout-ing and scamming.

I'll take the free movement of goods & services over the free movement of my money to scammers.

Sanjay M · Post by **Sanjay M** » 08 Sep 2010 22:45

arnab wrote:So to retain purchasing power the market must also ensure that it is not creating artificial demand at artificially inflated prices for products that people do not need. Then there would be no need for any sector (private or public) to ask for wage increases. If the pvt sector does its bit and stops scamming the public in general by providing unnecessary goods and services - I'm sure the banks and govt would follow suit.

You are asking for a command economy. There is no one single mind governing the free markets. That's like saying, "if all pigeons flying over the city would just go to the bathroom at the same time in the same place, then it would be easier to clean up their poop." In your dreams.
I have a right to charge whatever I want for any product or service I'm offering. If I wish to charge $100 for a glass of lemonade, that's my choice and my right to do so. Others may not choose to buy lemonade from me at that price, but that's their freedom to do so.

If someone 'needs' to buy an apple iphone and that is not construed as a 'scam' for the only reason that it originates in the private sector and therefore the market, then surely the govt (and banks) have the right to buy / sell products that they feel is required by their 'clients'.

That's called free choice.

Sure re cabbies - but then what do you think the US feels about free movement of labour? If there is no free labour market - then there is no 'free market', so why create useless strawmen arguing that 'markets are the true determinant of worth'?

Well, today movement of labour can be done electronically, and this has led to outsourcing which India capitalizes upon.

I'm afraid 'sillyness' lies not only in the repository of the 'middleman' and banks. And lobbyists can reasonably argue that they are providing a service to direct govt buying / selling behaviour that is best suited to their clients who need it (just like private sector advertising).

The point about big banks in the US is that they are a cartel/monopoly through the US Federal Reserve. The only beneficiaries of this setup are the cartel members themselves.

Sanjay M · Post by **Sanjay M** » 09 Sep 2010 03:29

Tom Friedman talks about the US going from Superpower to Frugalpower:

NYT
Op-Ed Columnist
Superbroke, Superfrugal, Superpower?
By THOMAS L. FRIEDMAN
Published: September 4, 2010

--

This is why some prideful Indians should think twice before embracing the "superpower" title for themselves. A "superpower" is a large country that gets suckered by other smaller countries into fighting their battles for them, at great cost to itself. Usually, this suckering involves plenty of ego-stroking and flattery, including prolific use of the word "superpower". Indians should not seek to be a "superpower" - not if they know what's good for themselves.

arnab · Post by **arnab** » 09 Sep 2010 06:15

Neshant wrote:
By contrast, there is no option but to pay for gold plated public sector pensions for the life of that person's retirement which in some cases is longer than the person worked! I cannot opt out of it, i sure as hell get nothing but poorer by paying for it. I cannot strike and not pay my taxes unlike the public sector which can strike and not work in leiu of salary/pension demands. I cannot get a gold plated pension plan myself and have it paid for by some sucker. I cannot refuse to pay for services I've never used. If I do any of the above, I go to jail. That is servitude.

They have a right to sell stuff. They don't have a right to force me to eat their gambling losses. Nor the right to piss away my earnings through counterfeiting of money. How do I opt out of that?

It surely can't be any worse than the free movement of taxpayer's money to make good the losses of banking crooks.

For at least in the free movement of labor scenario, one gets a useful service/good at a lower price even if one earns less as a result of such a system. In the free movement of bailouts, there is no useful service provided, and yet I earn less by having to paying for a banking crook's gambling losses via taxation, printing, inflating, bailout-ing and scamming.

I'll take the free movement of goods & services over the free movement of my money to scammers.

If you are confused it simply means you do not read enough. Just like someone buys an iphone (because they derive an utility), others derive utility from public services provided by the government (and its faceless officials). And just like demand for iphones and other services that I do not really need, and this contributes to the rise in inflation, which I then have to pay for. Similarly you are expected to pay for the salary and pensions of govt servants who provide you the service (irrespective of whether you use it or not). You cannot refuse to pay taxes in the US because the taxes are not a quid pro quo for govt to provide you the exact amount of services for the amount of taxes you paid. Over his lifetime, a lower income person gets more help (even though he pays less taxes) from the govt than a richer person because he needs it more - that is the 'redistribution' effect.

There are bright public servants

who work on various policy alternatives dealing with various aspects of governance which touches your life in different ways. This is known as externalities. You have to give incentives to these highly skilled public servants to do their job. This means pensions. You might feel they are getting a huge salary (who decides worth anyway? an admiral commanding a fleet makes less salary than a plumbing business owner, why? ) - but then think of the public service as a club. You have to jump through hoops to get into the service. OTOH anybody can drive a cab ot sell goods at woolworths.

Incidentally you can refuse to pay taxes generally by voting with your feet - you could move to saudi arabia? Perhaps then you would realise what you are actually getting for the taxes you pay

Re 'gambling losses on punts taken by banks' - sure they have the right to redistribute their losses to you. You invested money in the banks and investment properties to make a quick profit (and beat the decline in value of money due to inflation caused by you because you were buying iphones which were not needed in the first place) through these institutions. Were you complaining when your asset value was supposedly rising at 20 % p.a?

So deal with the losses now.

Neshant · Post by **Neshant** » 09 Sep 2010 06:16

As the tsunami approaches - Most remain blissfully unaware

By 2010, the general public received a series of shocks. The first shock was the jobless recovery of the Great Recession that cost 8 million jobs. Most of the job losses occurred in the private sector yet the majority of the $800 billion Stimulus Bill went to “save and create” public sector employment. The second shock was learning that civil servants earned twice that of private workers. According to the Bureau of Economic Analysis, Federal workers received average pay and benefits of $123,049 while private workers made $61,051 in total compensation. The third shock was revelation of incredible retirement plans doled out by politicians since 1999. In 2002, California passed SB 183 that allowed police and safety workers to retire after 30 years on the job with 3% of salary for each year of service, or 90% of their last year’s pay. During the Great Recession, fireman began retiring with $150,000 pensions at age 52 despite a life expectancy approaching 80. In Orange County CA, lifeguards, deemed safety workers, retired with $147,000 annual pensions. The Orange County sheriff, recently convicted of witness tampering, will receive $215,000 annually while in jail. Bob Citron, the Treasurer of Orange County who pushed the county into bankruptcy in the 1990s, receives a pension of $150,000 per year. A tsunami of anger and resentment is building.

http://www.newgeography.com/content/001 ... nstruction

Sanjay M · Post by **Sanjay M** » 09 Sep 2010 06:19

^^^ But iPhones aren't legally required to be bought. Taxes, however, aren't optional because they are enforced under legal penalty. Certainly, if we could fill out checkboxes on tax forms to agree to pay for certain govt services while opting out of others, then this would be a more reasonable comparison to your iPhone analogy.

arnab · Post by **arnab** » 09 Sep 2010 06:24

Sanjay M wrote:^^^ But iPhones aren't legally required to be bought. Taxes, however, aren't optional because they are enforced under legal penalty. Certainly, if we could fill out checkboxes on tax forms to agree to pay for certain govt services while opting out of others, then this would be a more reasonable comparison to your iPhone analogy.

That is because when you buy the iphone only you can derive its benefits. OTOH, if you do not pay taxes, the govt won't be able to remove you from say the defence security it provides to the US as whole. You get a lot of services just by being in the US and therefore you must pay for it.

Neshant · Post by **Neshant** » 09 Sep 2010 06:37

arnab wrote:Just like someone buys an iphone (because they derive an utility), others derive utility from public services provided by the government (and its faceless officials). .

If there was any utility from so called over-priced govt service with bloated salaries and life long pensions, it should be privatized to see how much the market is really willing to pay for it.

And just like demand for iphones and other services that I do not really need, and this contributes to the rise in inflation,

If you don't need it, don't buy it. Inflation is a result of an increase in money supply aka counterfeiting by banking crooks.

You cannot refuse to pay taxes in the US because the taxes are not a quid pro quo for govt to provide you the exact amount of services for the amount of taxes you paid.

Why not, I'd like to charge suckers who don't buy my product as well.

Over his lifetime, a lower income person gets more help (even though he pays less taxes) from the govt than a richer person because he needs it more - that is the 'redistribution' effect.

That's just politicians looking for votes. The real redistribution is occuring from the poor & middle class to banking crooks at the top via the printing press, bailouts and other scams. Its nothing more than a reverse robbin hood scheme.

There are bright public servants who work on various policy alternatives dealing with various aspects of governance which touches your life in different ways..

More like touches my wallet in different ways. Why don't they spread this brightness in the private sector and see how long they last? It is the best way to measure their worth. The fact that they resist privatization tells me a good number of them know they would be rolling tacos or selling hot dogs.

Incidentally you can refuse to pay taxes generally by voting with your feet - you could move to saudi arabia?

I don't intend to be run out by a bunch of crooks. I intend to run them out. Once the pension scams start collapsing and govt debt starts ballooning, things should get interesting.

Re 'gambling losses on punts taken by banks' - sure they have the right to redistribute their losses to you. You invested money in the banks and investment properties..

I didn't make any investment in banks or properties. Banking crooks did so they can eat their own gambling losses.

All of keynesian economics is nothing more than justifying a fraud and the above proves it!

arnab · Post by **arnab** » 09 Sep 2010 06:51

Neshant wrote:
If there was any utility from so called over-priced govt service with bloated salaries and life long pensions, it should be privatized to see how much the market is really willing to pay for it.

If you don't need it, don't buy it. Inflation is a result of an increase in money supply aka counterfeiting by banking crooks.

Why not, I'd like to charge suckers who don't buy my product as well.

That's just politicians looking for votes. The real redistribution is occuring from the poor & middle class to banking crooks at the top via the printing press, bailouts and other scams. Its nothing more than a reverse robbin hood scheme.

More like touches my wallet in different ways. Why don't they spread this brightness in the private sector and see how long they last? It is the best way to measure their worth.

I don't have to give anything. If they are worth what they claim, they should prove it in the private sector. But a good number of them would be selling hot dogs hence the reason they are strongly opposed to privatization.

I don't intend to be run out by a bunch of crooks. I intend to run them out. Once the pension scams start collapsing and govt debt starts ballooning, things should get interesting.

I didn't make any investment in banks or properties. Banking crooks did so they can eat their own gambling losses.

Why should the market or private sector decide the price of public service? All goods are not provided by the market or the private sector. While the Financial crisis was *gasp* caused by this much vaunted 'market' / private sector !!

Re inflation - look up CPI. If printing money was the cause of inflation, why is that with so much money printing going on the US - they are currently worried about deflation over there rather than inflation?

Sir you might not have invested in properties, you might be a complete peacenik and not believe in war - but you still gotta pay to upkeep the army

Sure - you can vote in whoever you want, but if you think things would be different then I'm afraid you would be sorely disappointed.

Neshant · Post by **Neshant** » 09 Sep 2010 07:33

arnab wrote:Why should the market or private sector decide the price of public service? .

Because the productive real economy pays for it. Banking & financing scammers are not the productive real economy.

arnab wrote:Re inflation - look up CPI. If printing money was the cause of inflation, why is that with so much money printing going on the US - they are currently worried about deflation over there rather than inflation?.

Because consumption is being destroyed at a faster rate than printing. The irony is a good portion of that destruction is itself due to printing. CPI is a bogus figure put out by govt. Look up John Williams shadow stats. Nothing except estate prices have gone down in price and that was over-priced to begin with. Everything else from groceries, to medical bills are up - and soon so will taxes in what is supposedly the greatest deflation since the great depression.

Prices need to be kept up as banking crooks are over-leveraged, insolvent and need price fixing measures to stay afloat. All the more reason it should sink.

Sir you might not have invested in properties, you might be a complete peacenik and not believe in war - but you still gotta pay to upkeep the army

There are no provisions for an income tax (let alone a printing or bailout tax) in the constitution. All services of govt are supposed to be paid for by an excise tax only.

Sure - you can vote in whoever you want, but if you think things would be different then I'm afraid you would be sorely disappointed.

It not me who will be sorely disappointed as I am prepared for what's to come. Its those who think the scam will continue indefinately. In the next 3 to 5 years, as living standards crash due to bloated govt, over-indebtedness and crooked banking, the mindset of the vast majority will change by itself once they see their livelyhoods & money evaporating.

Neshant · Post by **Neshant** » 09 Sep 2010 07:41

People who are working better get ready to be taxed up the wazoo.

As if banking criminals weren't enough, and bloated govt, along with money counterfeiting central bankers and lieing keynesian economists, a demographic boom in old people are going to depend on their income.

What other solution will there be other than printing (aka devaluing the currency) and taxing? Its looking more and more that a big drop in living standards are on the cards.

----------

Too poor to retire: The over-55s with no pension, no savings, just massive debts

Read more: http://www.dailymail.co.uk/news/article ... debts.html

arnab · Post by **arnab** » 09 Sep 2010 07:47

Neshant wrote:
Because the productive real economy pays for it. Banking & financing scammers are not the productive real economy.

Because consumption is being destroyed at a faster rate than printing. The irony is a good portion of that destruction is itself due to printing. CPI is a bogus figure put out by govt.
There are no provisions for an income tax (let alone a printing or bailout tax) in the constitution. All services of govt are supposed to be paid for by an excise tax only.

It not me who will be sorely disappointed as I am prepared for what's to come. Its those who think the scam will continue indefinately. In the next 3 to 5 years, as living standards crash due to bloated govt, over-indebtedness and crooked banking, the mindset of the vast majority will change by itself once they see their livelyhoods & money evaporating.

Ok - shall we talk about the 'productive real economy' automobile sector in the US?

when the big 3 chairment came to washington to beg for handouts in their private airplanes?

Well I really can't argue with conspiracy theories about CPI stats, but why would consumption be destroyed if the value of money is going down? why would you save? wouldn't it make more sense to spend and increase consumption? why is it not happenning?

Not that it matters, but a simple google offers this: 16th Amendment to the U.S. Constitution: Federal Income Tax (1913)
Passed by Congress on July 2, 1909, and ratified February 3, 1913, the 16th amendment established Congress's right to impose a Federal income tax. (think of the constitution as an organic document).

ok - since you have circled your wagons and prepared to inherit the future what is the gripe all about? Let them pay and you can have the last laugh

Neshant · Post by **Neshant** » 09 Sep 2010 08:14

arnab wrote: Ok - shall we talk about the 'productive real economy' automobile sector in the US? when the big 3 chairment came to washington to beg for handouts in their private airplanes?

Who says that's the productive economy? Surely a one line definition cannot be that confusing. Its not a keynesian explaination.

To reiterate : A productive segment of society is one which profitably fulfills a demand in society.

If its not profitable, its not productive. If its not productive, it needs to be shut down.

why would consumption be destroyed if the value of money is going down? why would you save
wouldn't it make more sense to spend and increase consumption? why is it not happenning?

Because salaries are declining or non-existant and debt is blowing up at a faster rate than the printing -ironically caused by the same jokers now doing the printing. This is not going to end well.

Passed by Congress on July 2, 1909, and ratified February 3, 1913, the 16th amendment established Congress's right to impose a Federal income tax. (think of the constitution as an organic document).

Tacted on by the same banking goons who introduced the Federal Reserve in 1913.

Let them pay and you can have the last laugh

Just as soon as I can get their hands off my wallet, all will be well in the world.

Neshant · Post by **Neshant** » 09 Sep 2010 08:19

One of my favourite videos :

[youtube]<object width="640" height="385"><param name="movie" value="http://www.youtube.com/v/VxxWBiQXyxo&co ... ram><param name="allowFullScreen" value="true"></param><param name="allowScriptAccess" value="always"></param><embed src="http://www.youtube.com/v/VxxWBiQXyxo&co ... edded&fs=1" type="application/x-shockwave-flash" allowfullscreen="true" allowScriptAccess="always" width="640" height="385"></embed></object>[/youtube]

arnab · Post by **arnab** » 09 Sep 2010 08:38

Neshant wrote: Who says that's the productive economy? Surely a one line definition cannot be that confusing. Its not a keynesian explaination.

To reiterate : A productive segment of society is one which profitably fulfills a demand in society.

If its not profitable, its not productive. If its not productive, it needs to be shut down.

Because salaries are declining or non-existant and debt is blowing up at a faster rate than the printing -ironically caused by the same jokers now doing the printing. This is not going to end well.

Tacted on by the same banking goons who introduced the Federal Reserve in 1913.

Well the auto industry seems to be making a profit now - so would you now say that it might have been premature to shut them down? How about the 'productive' US agriculture sector which thrives on subsidies? Or the US military industrial complex - which thrives only because the hated US public service buys their goods (more defense expenditure than the next 10 nations put together)? So moral of the story: anything can be made profitable if you can get the lobbying or marketing right. There is nothing inherent the private sector which makes it any more productive.

But salaries are declining in the 'free market' scenario - right (too many people, too few jobs)? Can you show us how printing money is leading to decline in salaries (given that deflation seems to be the problem rather than inflation)? similarly, the govt is acquiring debt - why isn't the private sector investing?

But it is in the Constitution right? Ah that damned Fed - pity those happy days of slave trade ended or those halcyon days of 1907 panic. Or close to home, the easy days when East India Co was given monopoly to trade in India so long as they earned profits for the throne

Sanjay M · Post by **Sanjay M** » 09 Sep 2010 09:17

Neshant,

I'd like to hear a little more detail on just how the US plans to devaluate the dollar without suffering a runaway implosion effect. Success hinges on being able to achieve controlled devaluation, without a runaway collapse of the dollar. How exactly can the US do this?

Neshant · Post by **Neshant** » 09 Sep 2010 12:50

arnab wrote: Well the auto industry seems to be making a profit now - so would you now say that it might have been premature to shut them down?

Cash for clunkers, screwing bond holders and handing over tax payer dollars is not profit making. Its loss making for the productive economy and hence the nation.

arnab wrote:How about the 'productive' US agriculture sector which thrives on subsidies?

If anything is thriving, it does not need a subsidy to begin with.

arnab wrote:Or the US military industrial complex - which thrives only because the hated US public service buys their goods

Its not the public sector that buys the goods, its the taxpayer.

arnab wrote:So moral of the story: anything can be made profitable....

... at the expense of the productive economy. Amen.

arnab wrote:But salaries are declining in the 'free market' scenario - right (too many people, too few jobs)? Can you show us how printing money is leading to decline in salaries (given that deflation seems to be the problem rather than inflation)? similarly, the govt is acquiring debt - why isn't the private sector investing?

Deflation is not a problem, prices need to fall to afforable levels. Only banking crooks want prices to remain high because they foolishly bet their azz and are now insolvent. There is no free market when banking crooks in cooperation with govt start meddling and cause malinvestments. They should not be gambling in the market in the first place.

Printing money is nothing more than robbing the productive economy of its purchasing power. The less the productive economy has, the less it can research, develop, produce and hire. The less the profitability in real terms. The less the salary, the less the employment, the less tax collection, the more debt, the more taxation, the less employment....etc etc.

But it is in the Constitution right? Ah that damned Fed - pity those happy days of slave trade ended

Has it ended? Looks like its still in existance to me. Federal Reserve crooks counterfeiting money and passing on losses of their cronies to society is perpetuating slavery. Where can I opt out of this robbery scheme that will keep me working till I'm old so some banking crooks and govt workers can live comfortably?

Neshant · Post by **Neshant** » 09 Sep 2010 13:25

Sanjay M wrote:I'd like to hear a little more detail on just how the US plans to devaluate the dollar without suffering a runaway implosion effect.

Keeping in mind keynesian economics is a shell game, my guess is the debt will just be moved from one nutshell to another. Its almost certainly connected to the introduction an international currency with a good pack of lies spread as to the reason for it.

I'm just waiting for that shoe to drop even as the fleecing of the local flock gathers pace.

ShivaS · Post by **ShivaS** » 09 Sep 2010 13:52

As US economy becomes weaker the USD will get stronger.

enqyoob · Post by **enqyoob** » 09 Sep 2010 17:12

But it is in the Constitution right? Ah that damned Fed - pity those happy days of slave trade ended or those halcyon days of 1907 panic. Or close to home, the easy days when East India Co was given monopoly to trade in India so long as they earned profits for the throne

Finally, some good thinking in this dhaga.

As the US economy becomes weaker, the USD will get stronger.

Ah! NOW I c. So clearly, US economy has been getting weaker than the Indian economy since 1966, when the USD was worth only 5 INR. Today it is worth INR46.6, so the Indian economy has become over 900% stronger compared to US economy. Awesome.

Tanaji · Post by **Tanaji** » 09 Sep 2010 17:25

^^ I think he is referring to the fact that the USD actually rose during the financial crisis in 2009, when the economy was tanking in US and worldwide because investors flocked to buy US treasury bonds...

Sanjay M · Post by **Sanjay M** » 09 Sep 2010 18:01

Well, all those kids with bulging stomachs in the OxFam commercials then must not be malnourished, but extremely well-fed, according to the same logic.

But really, we can see American economic kwashiorkor when the dollar is ballooning due to rampant Chinese dollar-buying, as opposed to domestic economic activity.

ramana · Post by **ramana** » 09 Sep 2010 20:21

Its interesting to see lefties support khanomics.

Hari Seldon · Post by **Hari Seldon** » 09 Sep 2010 20:48

Interesting take on the sham-scam-damn large sporting events (CWG anyone?) have become...

Vancouver taxpayers on hook for $1-billion as most Olympic Village units unsold

Sixty-six per cent of Vancouver’s pricey Olympic Village condos remain unsold — a total of 483 units at the massive False Creek development that served as athletes’ housing during the two-week 2010 Games.

Vancouver Mayor Gregor Robertson, whose city remains on the hook for more than $1.03 billion of the cost of the project, predicts it will take a “full two-year term” to sell the remaining units.

The suites, which are priced anywhere from $400,000 to $5 million each, have been subject to the HST since July.

The city’s investment in the project includes a $750-million loan plus undisclosed interest payments, $120 million still owed to the city for the land and a $110-million outlay for 252 affordable housing units.

Today, six months after the 2010 Olympic Games, the village resembles a ghost town.

Walking down the empty streets last Saturday afternoon, it was hard to find anyone actually living in the $1.2-billion former Olympic Village.

Even the security guards conceded there’s not much to do at the “showcase” Millennium Water development, where only 254 condos have been sold.

IMO sri Mish puts it very well when he says:

Fortunately Chicago dodged a bullet as it was foolishly attempting to "win" the upcoming 2016 Olympics. In this game, winning the bid is a guaranteed loss for taxpayers.

jai ho and all that.

Hari Seldon · Post by **Hari Seldon** » 09 Sep 2010 21:00

TAE tweets from the past few days...tell a story sorta, don't they...
http://twitter.com/AutomaticEarth

#Goldman Sachs to get fined a a near record sum by the UK's FSA. Probably on Thursday, for their fraud in the Abacus CDO deal.
[1 day later]
What a joke, UK's #FSA fines Goldman $27 Million for their fraudulent dealings in the Abacus CDO deal. GS shares up nearly 2pc.

More dark humor/rumor/tumor (take your pick)

To get U3 back to 5% would require the economy to generate about 17 million jobs — or about 285,000 a month for 5 years!

"Statistics are like bikinis. What they reveal is suggestive, but what they conceal is vital." Aaron Levenstein

Chu announces $40 million investment in Carbon Capture. The stuff's already captured; the problem is we're hell-bent on uncapturing it

Mkts went wild with joy (yet again) recently when BLS jobless figs came in better than expected. Then it was revealed that a full 9 states were yet to file their jobless claims reports only. Yet the mkts continued to party. Wow or what? Rigged is more like it.

9 states didn’t file claims data to the Labor Department in Washington because of the federal holiday earlier this week http://bit.ly/dCf2h4

So markets go up after a better than expected initial jobless claims report BUT 9 states just made up the data due to the Labor day holiday!

#Summer of discontent: Europe braces for anti-austerity strikes and protests http://bit.ly/b8YvBw

Consumer credit declined by $3.6 Billion for the month of July. The Government helped prop things up by being the biggest
lender.

TAE 7/11: The nation's four biggest lenders collectively hold about $7.5 trillion in assets, 48pc of total (BOFA, JPM, Citi and Wells Fargo)

Chalo, enough for aaj. Jai ho.

Neshant · Post by **Neshant** » 09 Sep 2010 21:08

Suckers in the private sector are desparately needed in California to fund the public sector as the graph goes exponential. The importance of suckers cannot be understated. A ready supply of suckers are needed to grease the wheels as they go under it.

---------

Here's the plain truth: California simply cannot solve its budgetary problems without addressing government-employee compensation and benefits.

Roughly 80 cents of every government dollar

in California goes to employee compensation and benefits. Those costs have been rising fast. Spending on California's state employees over the past decade rose at nearly three times the rate our revenues grew, crowding out programs of great importance to our citizens.

Much bigger increases in employee costs are on the horizon. Thanks to huge unfunded pension and retirement health-care promises granted by past governments, and also to deceptive accounting by state pension funds (such as unreasonable projections of investment returns), California is now saddled with $550 billion of retirement debt.

This year, retirement benefits—more than $6 billion—will exceed what the state is spending on higher education. Next year, retirement costs will rise another 15%. In fact, they are destined to grow so much faster than state revenues that they threaten to suck up the money for every other program in the state budget.

Few Californians in the private sector have $1 million in savings, but that's effectively the retirement account they guarantee to public employees who opt to retire at age 55 and are entitled to a monthly, inflation-protected check of $3,000 for the rest of their lives.

enqyoob · Post by **enqyoob** » 09 Sep 2010 21:21

Roughly 80 cents of every government dollar in California goes to employee compensation and benefits.

What else do you expect the guvrmand to do with THEIR dollars? Give them to the poor?

Besides, its hard work, enforcing all those laws passed by the (Republican..

) Governors and legislature in CA, to keep businesses from hiking the traffic, pollution and general crowding along Route 101, hain?

ldev · Post by **ldev** » 09 Sep 2010 23:09

Its almost certainly connected to the introduction an international currency

The US agreeing to give up control over its money supply in the current climate is farfetched. Remember for the US the dollar is supreme. If the Euro is regarded as competition how will they consider yuan issuers have defacto control over US money?

For the world's reserve currency there will never be a failed auction for US Treasuries because ultimately all dollar reserves whether created via QE or via the trade deficit end up with Fed member banks where the necessary exchange takes place. So the bellweather is USD value - and fortunately the only markets which are currently beyond manipulation because of their sheer volume are the FX markets.

svinayak · Post by **svinayak** » 10 Sep 2010 00:58

http://news.google.com/news/more?pz=1&c ... LiEhlRyloM

Global Housing Rebound Loses Momentum, OECD Says: Chart of the Day
Bloomberg - David Wilson - ‎2 hours ago‎
The housing market's recovery from its collapse two years ago is flagging worldwide, according to the Organization for Economic Cooperation and Development. The CHART OF THE DAY depicts the percentage of ...

OECD: Economy May Need More Stimulus
Wall Street Journal - William Horobin - ‎6 hours ago‎
PARIS—Central banks may have to provide additional stimulus, and in some cases governments may have to delay their plans to cut budget deficits to counter a slowdown in the global economy, the Organization for Economic Cooperation ...

Global economy slowing but recession unlikely says OECD
BBC News - ‎3 hours ago‎
The global economic recovery is slowing faster than forecast, but a return to recession is unlikely, a leading global economic group has said. The Organisation for Economic Co-operation and Development (OECD) said the slowdown had been more "pronounced

http://voices.washingtonpost.com/politi ... s_glo.html

Morning briefing: OECD says global recovery slowing faster than expected

Union members holds union flags during a protest against labor reforms in Madrid. Spanish lawmakers gave final approval to hotly disputed reforms, which could make it easier and cheaper for companies to fire workers but deemed essential for slashing the soaring jobless rate and reviving the fragile economy. Banner reads "Strike."

(Photo Credit: Dominque Faget/AFP/Getty Images)

1. The global economic recovery is slowing faster than anticipated, the Paris-based Organization for Economic Cooperation and Development said in its latest economic assessment. The OECD cut its growth forecasts for the second half of the year, estimating that the Group of Seven industrialized countries are predicted to grow by 1.5 percent on an annualized basis.

2. Japan announced it would sign a free trade pact with India that will end tariffs on 94 percent of goods that are traded over 10 years.

3. Spain gave the green light to labor market reforms that will help manage its deficit, a problem that prompted fears of another Greek-style debt crisis.

4. The Bank of England held interest rates steady at a record low of 0.5 percent as it has for the past year and a half.

5. The European Central Bank said in its monthly bulletin that the eurozone countries should be ready to "accelerate consolidation where necessary to correct their excessive deficits."

6. The Bank of Korea held rates steady for the second consecutive month.

7. The Organization of Petroleum Exporting Countries, which supplies 40 percent of the world's oil, cut its outlook for demand for crude in 2011. OPEC said in its monthly report that the world will need 28.8 million barrels of oil a day from its members next year, about 100,000 barrels a day less than in last month's report.

enqyoob · Post by **enqyoob** » 10 Sep 2010 01:43

It is very interesting to see the attitude of some of the postors here towards the promises made by employers to people whom they hired, and who devoted their entire careers to that organization - which is what defined-benefit retirement plans are.

It becomes utterly hilarious when these same people argue so stridently about the lack of honesty and ethics and backbone of various entities (except themselves, of course

) in doing things that benefited themselves, carefully staying within the laws created by the elected representatives of the people.

The time to whine about the outrageous nature of pensions plans, etc, is when the employee is hired, not 40 years later, in any system where ethics and honesty matter. But of course that would be a difficult concept....

But then they also endorse the types who argue that place of birth should not confer any right of citizenship... and it's fine to get caught lying in public... multiple times..

BTW, no, I don't have a guaranteed-benefit any plan, thanx.. I got out of it many years ago, reasoning that the brats I saw coming up as Political Leaders , I could see had absolutely no moral standards, ethics, backbone or the work ethic to succeed in any place that required honest effort. The stock market has done far worse than what the defined-benefit plan promises to do, but hey, all I have to do is read this dhaga and I commend myself on my good sense.

Then again, future retirees in the US can look forward to the prospect that $25Trillion won't be enough to buy a purse made in Shanghai, in a few years. With the present "T-partiers" doing the hard work and competing and

, there is not much else to hope for as outcome in global competition.

arnab · Post by **arnab** » 10 Sep 2010 04:46

enqyoob wrote:It is very interesting to see the attitude of some of the postors here towards the promises made by employers to people whom they hired, and who devoted their entire careers to that organization - which is what defined-benefit retirement plans are.

It becomes utterly hilarious when these same people argue so stridently about the lack of honesty and ethics and backbone of various entities (except themselves, of course ) in doing things that benefited themselves, carefully staying within the laws created by the elected representatives of the people.

True and add to this their definition of productivity - 'anything which profitably produces a demand in society'

So I guess child p0rn must be extremely productive since it is sure as hell profitable and there is a demand for it

arnab · Post by **arnab** » 10 Sep 2010 04:56

Neshant wrote:
Cash for clunkers, screwing bond holders and handing over tax payer dollars is not profit making. Its loss making for the productive economy and hence the nation.

If anything is thriving, it does not need a subsidy to begin with.

Its not the public sector that buys the goods, its the taxpayer.

... at the expense of the productive economy. Amen.

Deflation is not a problem, prices need to fall to afforable levels. Only banking crooks want prices to remain high because they foolishly bet their azz and are now insolvent. There is no free market when banking crooks in cooperation with govt start meddling and cause malinvestments. They should not be gambling in the market in the first place.

Printing money is nothing more than robbing the productive economy of its purchasing power. The less the productive economy has, the less it can research, develop, produce and hire. The less the profitability in real terms. The less the salary, the less the employment, the less tax collection, the more debt, the more taxation, the less employment....etc etc.

Has it ended? Looks like its still in existance to me. Federal Reserve crooks counterfeiting money and passing on losses of their cronies to society is perpetuating slavery. Where can I opt out of this robbery scheme that will keep me working till I'm old so some banking crooks and govt workers can live comfortably?

So your definition of productivity is linked to profits. Since a government is not in the job of making profits therefore by definition it must be unproductive. You keep talking about 'printing counterfiet money' but you still haven't shown me where the inflation due to all this money printing is coming from? Or what the appropriate level of money supply ought to be?

The public sector buys goods on behalf of the tax payer - so if you do not object to the PS using tax payer dollars for very expensive defence products which seems to keep increasing in price every year and thereby contributing to inflation, why object to other activities of the public service?

Re counterfeiting money to keep you working perpetually - I think you should be thankful you have a job to go to. If the 1939 policies of non-intervention were followed, and the unemployment rate hit 27 %, you could be out of a job as well, despite your thinking that you are contributing to society