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Procopius
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"... people who value their own reputations should take care to avoid any kind of association with the scams ahead." I thought it had become clear over the last forty years that reputation is not a thing of value in the marketplace. Nobody knows any other party's reputation. It's lost in the fog of information asymmetry. This is especially true among the mega-rich where, in fact, a reputation for sharp dealing seems to be valued. Just look at Trump.
Toggle Commented Nov 22, 2016 on Paul Krugman: Build He Won’t at Economist's View
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Dems never had a "veto-proof majority" in the Senate. They never even had a filibuster-proof majority. A veto-proof majority is 67 or more Senators. A filibuster-proof majority requires 60 or more Senators. The Democrats never had more than 58, and that was before Ted Kennedy died. I'm sick to death of right-wingers claiming the Democrats had the clear ability to do whatever they wanted without regard to "minority rights." They always had to cater to Weepin' Joe Lieberman.
Toggle Commented Nov 13, 2016 on Links for 11-11-16 at Economist's View
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I've recently been reading Arthur M. Schlesinger, Jr.'s, The Coming of the New Deal. What FDR and many of his advisers recognized in 1932-3 was that people did not want welfare, they wanted jobs. Welfare, "the dole," is demoralizing. Public works turned out to be popular and also left us a great legacy of office buildings, schools, firehouses, roads, bridges, etc. It's not clear to me that Basic Income would not have the same deleterious effects as straight welfare. It would be critical that there be no reduction of the payments for people working and earning additional income. I don't think that's politically feasible yet. There are still people who want to means test Social Security, which is probably the Fourth or Fifth Worst Idea in Politics.
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Ok, so Romney was already rich by the time his father died and he gave all that inheritance to some university, but I seem to recall his wife mentioning, "Well, we did have this stock, and when things got tight we would sell a little of it ..." So he (they?) had a trust fund or something like it that relieved them of worry while they were at college and they didn't need to take out student loans and their tuition and books were paid for, and then there were Daddy's "connections," the people who owed him favors or hoped to owe him for favors in the future. Kind of like a higher level Megan McCardle.
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"... funds that can invest in high-risk investments, where transaction fees are much higher." ...and returns are somewhat lower than low-load index funds. There, fixed that for ya.
I have had the impression there is a civil war going on in the Deep State. It seems as though occasionally Obama is able to nudge things toward the vision he makes speeches about, and then in a day or to it's back to regime change in Moscow. If true, this would also help explain the apparent lack of any coherent goals that make sense (or make sense to me, I should say). Of course I may misunderstand which direction is the one he wants to go.
I need to dig up some data to try to see more clearly, but just working from memory... I find your view plausible, but I remember that at least by 2003 the Economist was printing articles every month about the insane housing bubble in the U.S. and (IIRC) Great Britain. They were giving very scary statistics about the ratio of housing prices to rents, and the rate of increase in house prices way above historic trend. I think the Bush tax cut may have added some to the housing bubble, but it didn't do much for the wider economy, which was puzzling (to me). It suggests to me that income tax rates are already so far below their optimum that further cuts must be counterproductive.
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Thanks for the detailed clarification. I think we're pretty much in agreement. My own opinion is that the appeal to geopolitical necessity is pure BS. I saw one article that claimed it was absolutely essential to cement relations with Malaysia because of the strategic choke point on the Andaman Straits, but that's a spurious argument. They would not refrain from closing the straits to please China just to retain the very small amount of trade they have with us (well, OK, I guess it's not small to them, but still ...). Also, too, this agreement is not going to prevent any of these partners from increasing trade with China, unless there are more secret annexes we haven't found out about (very possible).
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It seems they are not concerned with the evidence that wages have been decoupled from productivity increases since about 1972. Perhaps they are not aware of it? Or maybe they just don't believe it? The only period we've seen significant growth in real wages since then was 1994-2000, and that wasn't enough to offset the trend. This, by the way, is one reason I doubt the reality of NAIRU. We saw wage increases, but I wouldn't call the accompanying inflation significant. However, capitalism demands a large reserve army of the unemployed, so that's what they try to produce.
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Since I am not an economist I probably shouldn't comment on it, but if we cannot observe it, how does it differ from the hippogriff or the unicorn? By the way, even though we can't observe it I'm willing to believe there is a Wicksellian Natural Rate of interest -- as a hypothesis it seems to work well in many models. "But at some point you get accelerating inflation." I'm willing to change my opinion in response to evidence. In what years since 1983 have we seen this occur? I seem to recall that in 1999 the unemployment rate was 4.0%. In the year 2000 the inflation rate was 3.73%. That was higher than 1999 which was higher than 1998, but then we had a recession and in 2001 the rate was 1.14%. The data don't look very persuasive to me. What other years do you suggest? I'm willing to go further back then 1983, if you like, but I think that was the point where Volcker and Reagan had emasculated the unions and indexed wage rates were no longer common.
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I applaud your viewpoint, and mostly agree with it, although I don't quite know where to put Obama's revival of Star Chamber in that framework (drone killing anyone anywhere anytime on the President's acceptance of accusations without rule of law or outside overview). However, I am bothered by one phrase, "I suspect Obama's objectives are to try to provide legal protection to industries that benefit and are still strong in the U.S." It's difficult to judge given the incredible secrecy enforced, but that simply doesn't seem supported. What industries need legal protection, where? Do you mean the pharmaceutical industry? Big Tobacco? Hollywood? Because those are the industries that seem to be getting additional protection, based on the unauthorized leaks of drafts we've been able to see. Do you really think it is credible to argue that Malaysia, or Peru, would feel free to expropriate foreign investments?
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"They keep pushing that number down as time goes on." Yes. Well, we saw in the late '90s that there was no raging inflation, no inflationary spiral, when unemployment was down to 4%. Yellen is now saying that was because of large productivity increases, but I find that explanation dubious. Personally, I think NAIRU is a myth, like the Loch Ness Monster, but I'm not an economist.
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I sometimes wish they would simply admit what they've been indirectly implying for years, 2% is a ceiling, not a goal. I don't suppose it would make any difference, because 2% is way too low anyway, but it would be a breath of refreshing honestly. All they would have to do is say their inflation goal is the same as the European Central Bank's, close to, but under, 2%. This is something everybody believes now anyway, given cryptic utterances from people like Lacker. This is the source of the inflation expectations that are well below 2%. I mean they keep saying they are trying to give "forward guidance," right? Well, they've succeeded. Also, it seems they are totally committed to Marx's insight, capitalism requires a large reserve army of unemployed.
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They're all firmly committed to the Phillips Curve, aren't they?
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The only problem with the F-35, aside from the fact that it can only carry one bomb at a time, is that it can only fly four hours a week. If it doesn't rain. Because the rest of the time is spent doing "maintenance," fixing all the things that were broken by normal usage. Oh, wait, "One of the problems ..."
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Could care less. That's what's called an idiom. Idiomatic speech and writing may not follow the rules of formal/academic writing. Don't like it? LOL.
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I am not an economist, which is probably why I do not understand, "In such an environment, financial accommodation needs to be withdrawn pre-emptively to avoid overshooting the targets." Why is it so imperative to avoid overshooting the "targets?" I know that over the last few years members of the FOMC have accidentally revealed that 2% is actually the ceiling, not a "target." Since we've been below target for so long I would think a year or two of 3% or 4% would be a good development. When I was a kid (under 40) we were used to annual inflation of 3.5-5%, and the country was mostly prospering. On a related note, why do members of the FOMC feel required to claim that 2% is their "target, not a ceiling?" Why can't they just do like the ECB and declare that their target is "close to but below 2%?"
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Why do people who are not Krugman keep telling us what Krugman wants? Also, what's wrong with large deficits when people are demanding, demanding, I tell you, safe investments (aka treasury bonds). Where do you think treasury bonds come from? High prices = low yield means there is a huge demand for more bonds because nobody sees profitable investment opportunities. It does not mean a bubble.
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I don't get it. Is this a joke? Is this supposed to be a parody? You write, "Cops really won't and don't stop kids from walking around -- but someone might like to pretend they do..." WTF? Of course they do. Didn't you ever run away from home when you were a kid? I did and I guarantee a cop stopped me and took me home. And look at Cleveland. Cops don't just stop kids from walking around, they kill them.
Toggle Commented Jan 19, 2015 on Rawhide at Whiskey Fire
Yes. Let's see, too, what other policy changes the Dems are going to make. I think withdrawal of support for the "trade" agreements, TPP and TPIP, would be a good start. It's widely recognized that these treaties are going to be disasters for working and middle class people, which is why they are being shrouded in secrecy. I've seen speculation beginning in several places that people are beginning to realize that the policies that produced the great wage stagnation and soaring inequality are Democratic policies starting with Carter and given a large impetus by Clinton and Obama. Of course they were also augmented by the Republicans, especially Reagan and Bush II.
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What the Obama administration has been using is the Espionage Act of 1914, a grossly excessive charge. They probably don't want to use such a strong charge against one of their own, even though he is said to have committed far worse offenses than the whistleblowers they are trying to put in prison for fifty years. I expect Holder is trying to avoid embarrassment at being so hypocritical and applying such an obvious double standard, although he is probably the only high administration official who is worried about feeling embarrassed. Most of them have no sense of shame.
Toggle Commented Jan 11, 2015 on Petraeus to be tried? at Sic Semper Tyrannis
Well, let's face it, George Catlett Marshall was an extraordinary man. We aren't likely to see his like for another two or three hundred years, worse luck for us. Same with (FD) Roosevelt. What we have now are pygmies. Well, LBJ had some heft to him, but it's been all downhill since Nixon. All the general officers visible to the general public are at best time-servers and at worst deeply corrupt. I think Frank Zinni was at least competent, but none of his contemporaries. OK, I'm probably too pessimistic, but since my disillusionment with Colin Powell my pendulum has swung the other way.
Toggle Commented Jan 11, 2015 on Petraeus to be tried? at Sic Semper Tyrannis
Yes, I think "not decisive from the strategic standpoint" suffers from a false understanding of strategy. Tet 1968 was hailed by the Army leadership as a great victory for the American side and their puppet forces, because they had taken back all the territory the VC had originally captured and inflicted large losses on the enemy. In fact some Army spokesmen claimed that VC losses were greater than the number of VC they had earlier claimed existed. In reality, it was a decisive strategic loss for the U.S. side, as the hollowness of their claims of "light at the end of the tunnel" was exposed. Nixon managed to keep the war going, but in the end had to accept a humiliating failure.
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