Economy, Banks, Gold, and other stuff.

[astralis]

DOR,

arguing with someone whom refuses to see the difference between keynesianism and monetarism; with someone whose idea of proof is a stock investment blog and youtube videos; with someone whom repeats the same conspiracy theories despite, or perhaps because of, all the evidence presented...

[snapper]

Of course Bernanke is incapable of error! He really is trying to help 'Main Street' (although he's unelected and has his salary payed by the banks). People only do bad things, or get things wrong, on the other side of Atlantic because that's where Orwell was born. I shall be sure to bear that in mind. Perhaps we know where it's going because we have more recent memories of this form 'Government'.

As to Keynesian-ism and this debt monetisation what was the purpose of Governments running a deficit in the 60's and 70's? To achieve "full employment" and what is the Fed's stated aim now? To reduce unemployment to 6.4%... Why stop there?

Even the IMF is now worried about bubbles;

"There is a risk of overheating of domestic economies, so we have to pay close attention to this risk," said IMF Deputy Managing Director Naoyuki Shinohara. "There are some warning signals, but it is not up to the level to ring alarm bells," he said.

Yuko Kinoshita, assistant to the director of the IMF's regional office for Asia and the Pacific, warned of a potential spike or "bubble trend" in asset prices.

"If these are not controlled, there could be a serious boom and bust cycle," she said.

Still I DO hope that you are right...

[DOR]

As to Keynesian-ism and this debt monetisation what was the purpose of Governments running a deficit in the 60's and 70's? To achieve "full employment" and what is the Fed's stated aim now? To reduce unemployment to 6.4%... Why stop there?

US Unemployment Rate and Budget Balance (average per annum)
_ _ _ _ _Unemployment _ _ Budget (% of GDP)
1951-55 _ _ 3.9% _ _ _ _ _ _ _-0.3%
1956-60 _ _ 5.3% _ _ _ _ _ _ _-0.3%
1961-65 _ _ 5.5% _ _ _ _ _ _ _-0.7%
1966-70 _ _ 3.9% _ _ _ _ _ _ _-0.8%
1971-75 _ _ 5.5% _ _ _ _ _ _ _-1.7%
1976-82 _ _ 6.8% _ _ _ _ _ _ _-2.7%

Now, what was it you were trying to argue?
At -0.3% budget deficit, unemployment can be 3.9% . . . or, 5.3%
More than double the deficit, and unemployment can be 3.9% . . . or, 5.5%.

My point is that looking at one policy item or economic indicator can lead you to whatever conclusion you might be predisposed to accept.

[edited to expand snapper's quote to more fully reflect the response, and to add the following:]


“somewhat more like the standards expected of business.”
That's not the same as "the government is a business."

[Doktor]

Isn't that the beauty of the stats? They have the data you want to see.

[DOR]

DOR,

arguing with someone whom refuses to see the difference between keynesianism and monetarism; with someone whose idea of proof is a stock investment blog and youtube videos; with someone whom repeats the same conspiracy theories despite, or perhaps because of, all the evidence presented...

Understood, my friend.
But, I'm on a mission to erase ignorance one post at a time . . .
:-)

[snapper]

My point is that looking at one policy item or economic indicator can lead you to whatever conclusion you might be predisposed to accept.

I would agree! However I am not sure why you only quote unemployment and deficit figures to illustrate such a point.

“somewhat more like the standards expected of business.”
That's not the same as "the government is a business."

Perhaps the Government and the Central Banks should stop trying to be business's then? The trouble is that edicts from both are compulsory on those trying to conduct private business.

Look it's all very well for astralis and BigFella to discount any other view other than their own; the 'mainstream view'. However it was precisely the practice of this 'mainstream' theory that resulted in the 2008 crash. We are NOT disputing 'facts' but the interpretation of the 'facts'. To my mind post 2008 the same policies and more have been used to try to 'resolve' the downturn... post 2000 rates dropped and nobody in charge foresaw the crash of 2008. Now they are repeating the methodology. I am not saying that the well known and fully researched alternative of the 'Austrian' school will necessarily fare any better - I don't know - however to dismiss it as worthless or unworthy of consideration is in my opinion rash to put it mildly.

As for 'conspiracy theories' have a go at these:

The Internal Revenue Service's scrutiny of conservative groups went beyond those with "tea party" or "patriot" in their names—as the agency admitted Friday—to also include ones worried about government spending, debt or taxes, and even ones that lobbied to "make America a better place to live," according to new details of a government probe.

Wider Problems Found at IRS - WSJ.com

The Justice Department secretly obtained two months of telephone records of reporters and editors for The Associated Press in what the news cooperative's top executive called a "massive and unprecedented intrusion" into how news organizations gather the news.

The records obtained by the Justice Department listed outgoing calls for the work and personal phone numbers of individual reporters, for general AP office numbers in New York, Washington and Hartford, Conn., and for the main number for the AP in the House of Representatives press gallery, according to attorneys for the AP. It was not clear if the records also included incoming calls or the duration of the calls.

Gov't obtains wide AP phone records in probe

[DOR]

snapper,

1.

As to Keynesian-ism and this debt monetisation what was the purpose of Governments running a deficit in the 60's and 70's? To achieve "full employment" and what is the Fed's stated aim now? To reduce unemployment to 6.4%... Why stop there?

That’s why I quoted deficit and unemployment numbers.

.

2.

Perhaps the Government and the Central Banks should stop trying to be business's then?

If government were a business it would declare Chapter 11, default and resume operations. That’s happened in the past, but it has such horrific consequences that it is the least desired option.

.

3.

it was precisely the practice of this 'mainstream' theory that resulted in the 2008 crash.

Nonsense. In the 1990s we balanced the budget without wholesale asset destruction. W then doubled the national debt by giving unnecessary and disproportionate tax breaks to the wealthy and cutting benefits for those in need.

That’s not the ‘mainstream theory.’

.

4. RE: the IRS. Given the task of identifying political action committees, in 2010, that were hiding under tax-free status designed for social welfare organizations, what would your own search parameters have been?

Suggestions neatly printed on a 3x5 card, please.

.

5. AP phone records. News to me; any idea what they were investigating?

[Doktor]

What's the % of Bush cuts on the income side of the budget?

Are they higher then the deficit?

Would the spending be the same if the income side of the budget was higher?

Finally, would the tax base be the same? Or higher? Or lower?

[snapper]

1. That’s why I quoted deficit and unemployment numbers.

I don't disagree with your figures but given that your argument is "looking at one policy item or economic indicator can lead you to whatever conclusion you might be predisposed to accept" (with which I agree) how can printing alone cure the unemployment problem or the debt problem?
.

2. If government were a business it would declare Chapter 11, default and resume operations. That’s happened in the past, but it has such horrific consequences that it is the least desired option.

It should do so. Whatever consequences ensue in the short term should they do so will only be amplified by ignoring the problem until it strikes. QE, as you must be aware does NOT benefit the 'man on the Clapham omnibus'; it benefits the banks who he/she has been forced to 'bail out' (a form of 'bail in' by Government borrowing).
.

3. Nonsense. In the 1990s we balanced the budget without wholesale asset destruction. W then doubled the national debt by giving unnecessary and disproportionate tax breaks to the wealthy and cutting benefits for those in need.

That’s not the ‘mainstream theory.’

I was speaking of 2000 post 'dotcom bubble' to 2008 when Greenspan lowered rates and created a housing bubble.
.

4. RE: the IRS. Given the task of identifying political action committees, in 2010, that were hiding under tax-free status designed for social welfare organizations, what would your own search parameters have been?

Suggestions neatly printed on a 3x5 card, please.

How about "Not those a word search suggests might be politically opposed to the ruling Party"? Not sure that fits your card but the size of the card you stipulate doesn't really matter does it? The apparatus of the State has clearly been abused - at taxpayers expense - for political gain. Would you agree with me that such a thing is 'wrong'?
.

5. AP phone records. News to me; any idea what they were investigating?

I look forward to hearing.

Dok I shall try to answer the answers I can as best I may:

What's the % of Bush cuts on the income side of the budget?

I can't answer that off hand, perhaps David can.

Are they higher then the deficit?

No they certainly were not deficit x 2. The point is they were supposed to be 'stimulus' on the supply side whereas now the emphasis is on stimulating the demand side. Which is preferable short and long term is the point at discussion.

Would the spending be the same if the income side of the budget was higher?

That depends; maybe you would opt to keep spending the same and pay off some debt. Perhaps you would further lower taxes and hope that produced more revenue. Or perhaps you'd invade Iraq.

Finally, would the tax base be the same? Or higher? Or lower?

Certainly if you cut taxes then less tax gets payed short term. To cut the tax base equitably the poorest people should be exempted from income tax first. They would then have more to spend etc etc. That is one way of lowering the 'tax base'. Other options might be (in the UK) the abolition of Inheritance Tax or applying it only after a higher limit etc...

[astralis]

the AP phone record investigation had to do with a leaked account of a foiled Al-Qaeda plot. sorry, no grist for the conspiracy mill here.

[dalem]

the AP phone record investigation had to do with a leaked account of a foiled Al-Qaeda plot. sorry, no grist for the conspiracy mill here.

So I guess if Bush's AG had pulled phone records of the AP after any of the half dozen leaks by the NYT, etc., about their antiterror efforts, that wouldn't have been newsworthy.

Good to know.

-dale

[astralis]

and this has anything to do with the current thread how?

[dalem]

and this has anything to do with the current thread how?

It is a reply to part of one of your posts, in this-here current thread, in case you were wondering.

Which you were.

If you are truly concerned about thread drift then you should have not commented on that particular topic, brought up by snapper & DOR in the first place.

-dale

[astralis]

snapper used the AP investigation as evidence of government ability to pull off a conspiracy, which she believes was a reason why we had the 2008 economic crisis.

my comment was that there is no conspiracy.

your comment is just off-topic snark.

[astralis]

dale,

you used to have well-reasoned, thought out posts; posts i would often disagree with, but something that could be debated at length. along with the occasional (well, more than occasional) crude, snarky one-liner posts which we all know and accept to be part of the Dalem Posting Experience.

but if you're just going to do the latter, especially when it has nothing to do with the topic on hand, i have no compunction in deleting the posts in question-- as i'll do now.

and lest you start screeching "censorship" and try to strike a martyred pose, allow me to point out that despite my complete and utter disagreement with what snapper is saying, i've not interfered with her posting in the least because she is quite civil and will remain on topic.