esb
sorry i didn't get back here

GDP, CPI-U and core, PPI and PPI core??

(My working #s are 5.8, 0, 4.0 and 2.5, 5.0 and 3.0).

if it turns out as good as your numbers

i'll kiss km4's ass

by that i mean those ripe price rises

some serious commodity price drops ahead ???

if so
might send the product indexes

down faster then the main stream models suggest

reaction times increase in troubled waters eh ??

ps
i'm out of the numbers game

i peaked predicting interest rate turns
in the reagan era

btw
i missed the gold bug

this time

laughed off

the old elves gold crude ratio

there was money

to be made there

alas

i nailed the down turn on metals in the 70's
as a mere lad

but it was others made the green that round

my turn
the palm sweated the eyes blurred

the call came with a quaver

after that it was all

blue farts and fairy dust

Posted by js paine at 03:24 AM

bruce w :
“it is easy to falsely imagine a quick and easy re-flation of the 1930 economy, and things would go on as they were, with “confidence” restored. “

monetary policy is all you need
any and all liquidity traps can be sprung by fed skin rovers

what happens if …

it don't work
if …

its here comes the deflation trap time ???

and ain't that maybe
just the ticket we bought

when we buried ole faggy keynes

Posted by js paine at 02:53 AM

“paine, … There's no groping for the middle ground on this one.”

i agree
you either stay home here as johnny q advised

or you choose your foreign monster to fight

kt we agree on much else

but not on how to contain US hegemonic global ambition

i suspect you may have supported
the genocide pre empting bomb runs over serbia

am i correct ???

Posted by js paine at 02:42 AM

volkish story telling
by

ooonkle paul :

“What turned an ordinary recession into a civilization-threatening slump was the wave of bank runs that swept across America in 1930 and 1931”

if that was the cause
what explains the prior 100 years of cycles

NOT called great depressions

a purer gold standard system ???

if regs prevent 30 type runs apon runs

what worked its magic in say

1873 ????

1894 ???

regulations ???

silver strikes ???

or were we building all those years
from waterloo on

toward a cataclysmic finale

the final great smash up
to the unreg-ed global hi fi system

“solvency and liquidity issues can't be easily picked apart”

not in a full credit system
i was

touched by some wharton school egg face

talking about long flight capital

his words more or less

“if they'd been able to hold on
their bets would have won “

if they'd been able to hold out

ie credit lines were continued

once we have a credit system able to produce any amount of credit necessary
if it so chooses

we are not in a regime where the distinction between
l and s has much clarity

its like ahhh all relative man…ahh relative

to the credit flows

like these keep em alive machines

you gotta pull the f in plug fast
or they go on and on

till they err ….recover more or less

come on folks

why were regs not needed to pull the global economy
out of all the priors

the contractions panics and such b4 29 ??
come on

we austrians are waiting

Posted by: paine | Link to comment | March 21, 2008 at 07:48 AM

paine says…
16 %

face it anne
that was not as good as the unassisted recovery

from the serious contraction of 1894

even scaling up

are you claiming by implication
the great depression was a beast

of a different kind

from the n priors ?????

again i repeat
the von show

is waiting for your answer

The GI Bill was a brilliant stroke
i agree totally

we nedd a jobblers bill
just like the gi bill

for every citizen

who has worked a job in america

for more then 8000 paid hours

“The Depression was different from any recession or panic before in severity, but what else”
anne you always get my indirection

that is precisely what needs to be addressed
the qualitative difference between even the deepest

and most protracted victorian contractions

and

el biggo

i'd start by reverse engineering the hi fi system
like the austrians do

only not to create some gi mutt nik rose ringed picture of hard money jacksonianism

but for the brake down of the old global system
during the great war and its non reconstruction

of a consensus system

after versailles

in contrast note the post WWII
master piece of hi fi consensus

wall street and the city oughta
praise

the generalissimo stalin

the great ogre

for concentrating minds

bruce
nice thumb nail tale

i think you are empirically correct
about the sticky price versus sticky output

qualitative change occuring some where

sector by sector

and accelerated by 94

73 was among other things
—as you imply — a railroad bust

a bit like our recent internet bust

worth noting
the era of sticky prices

cartel formation

emerged out of

the gold standards

rigorous deflation tilt

in an era of high industrial output growth

all this being said
i find only results here not causation

when the simple question of why that when not this when
still requires an answer

i like your notion of insurance
you might note

gub sponsored insurance

is really socialization

by a false name

its really a recognition

that spontaneous market's left to themselves

will fail to develop adequate insurance markets

in some crucial areas of economic activity

that forced the new deal's hand

deposit insurance unemployment insurance …..
but regs matter

hour limits wage floors

price flooors and ceilings

are second best only in the sense

angels could do it all

by markets only

err unless there was a war in heaven

and one third of the angels

became ill … ill … and ill …

Posted by: paine | Link to comment | March 21, 2008 at 02:12 PM

paine says…
come to think of it

the sudden love affair with insurance
that struck the pri sec in waves from

about 80 on

all now busting open

like so many pretty easter eggs

dumped on the side walk

proves there is a line between
insurance and socialization

and some ” security type products ”

can only be…. reliably supplied

at gub-point

Posted by: paine | Link to comment | March 21, 2008 at 02:24 PM

says…
i predict this crisis

starts a new meme cluster

neo socialism
anne i figure

getting norte america out of the depression

would have been easy

if frank R had jumped directly

to the arsenal of democracy gig

in 33

after all
adolph was into it sraight off

and stalin had a five year lead

hey …..i really am a totalitarian
“Economic theory, hijacked by an anti-institutionalist libertarian bias sometimes seems more determined to forget what it used to know than to learn anything new”

determined to forget by means
of shrewd simplifying assumptions

ex - (and) im -plicit

chosen for “tractability ”

“it looked liked a determined effort
against all reason and evidence

to resurrect Say's Law

and a self-equilibrating system

ripe for laissez-faire”

exactly

as with most economic “discovery”
its class interest axiologic

the arrows that fail are ignored
those that hit the bull's eye

get published and referenced

the rat-x classical revival
of the 70's

clever stymie of keynes

even if like an african violet

it could only survive

in the hot house of academe

but in there among the secluded meme racks

it could play hob with sane policy notions

and its emergence right as i began the study quest

was all the proof i needed

that in living fact

this dismal science

was indeed a part

—-if an odd part—-

of the greater

class struggle

a contest
worthy of Demille

like moses and his staff

against pharoah's best

a battle waged

with magic tricks performed thru algebra

and whats more

the bad guys are smart
and never sleep

Posted by: paine | Link to comment | March 21, 2008 at 05:24 PM

paine says…
bruce

i was meant for history

but i like to make toy replicas

that appear to work like the real thing

and as my x told me just this after noon

“shit if we knew what really caused
the great depression

we'd already be livin'

in the next stage of human history

and it looks from the headlines

like we aren't “

Posted by: paine | Link to comment | March 21, 2008 at 05:34 PM

paine says…
“recovery” came by accident, and people learned little or nothing. “

sez it all ….most times anyway

Posted by: paine | Link to comment | March 21, 2008 at 05:37 PM

paine says…
“substantive reform came only after the bankers' panics of 1902 and 1907”

and the bankers themselves had a plan

the result
was indeed subsantive reform

the reform was sorta democratic
and looked to create a balance of power

between the people and the banks

much unlike the banker's own plan

but as to the substance
the fed went from

a dream of a people's overseer

to the bankers agency

in about three easy moves

the cycle has repeated itself since
during the depression the fed turned back

into an instrument of social progress

till truman cut it free

to raid with the bankers again

around the time of the korean war

lets hope its headed for another
run thru the peoples car wash

Posted by: paine | Link

Posted by js paine at 01:49 AM

jeff sachs
is so wrong so often…

i have to believe
he's on some evil elf's payroll

just who would wish
all these atrocious outcomes

he's produced or at least tried to produce ???

well it's way beyond me
butthen again as gerry knows

i'm not very clever am i

some one please
please

find out who's sponsoring

this self assured twit

and give him

an aweful tongue lashing

Posted by js paine at 11:01 PM

“expectations management”

once all else is “in the trap “
that's the final policy voodoo

levitate the price system
by telekinetic gab

talk about invisible hands …

u thought chasing the natural rate was a grail too far

wait till this puppy barks

…
horse feathers that fall like lead shot

“A truly stable dollar (average inflation rate 0% over time) would go a long way toward restoring balance between saving/borrowing in the US.”

…
i hardly grow in resolve

as i cruise these figments

or better

these fragments of figments

Posted by js paine at 10:54 PM

come to think of it

the sudden love affair with insurance
that struck the pri sec in waves from

about 80 on

all now busting open

like so many pretty easter eggs

dumped on the side walk

proves there is a line between
insurance and socialization

and some ” security type products ”

can only be…. reliably supplied

at gub-point

i predict this crisis
starts a new meme cluster

neo socialism

Posted by js paine at 10:52 PM

killer

you run the credit system so close to the money line
you may have forgotten the ultimo commodity

shineful metalic money

locke the guy who said
personal property

naturally ends at spoilage

let the whole exploitation game

pass thru

by introducing

the product of that single mine shaft

money

money of real scarcity
imperishable money

homogenous money

evenly easily divisible money

have this money acting as medium of exchange
plus store of wealth

but not yet means of payment

still strictly avoids financial promises… credit

in god we trust everyone else pays cash
is a world rule

that preserves

the lockean 6 billion crusoe islands

Posted by js paine at 02:44 PM

marble ous steve
by implication

condemns the free and private enterpise system

“A credit crisis is a phenomena of unconsolidated balance sheets. “

jan tinbergen i think called this secondary uncertainty
ie

not part of …”that's life bub”

but part of

the carry cost of running

an opaque by design enterpise system

to wax karlian

the credit system is a partial sublation of capitalism

as with any partial solution
trouble abounds at the contradiction points

seems every time
the bridge building crew

are just about

to reach the far side of the river …

recall
penelope's loom and the suitors

Posted by js paine at 02:42 PM

“It would be nice if we could all live in Santa Barbara or Charlotte, but trying to pack large amounts of our population in a few areas is going to be a disaster on many levels”

combines several world views

my preference

hyper density

mile high towers
with three d bridging

and all job sites

up to a mile under ground

but i'm a martian
” the demands imposed by global warming and peak oil mean that the suburban drive-to-a-good-job, drive-to-cheap-shopping, drive-to-a-big-house model will have to be radically revised”

case of
imposing aesthetic values

on notional prices

in the name of hard science

…
however

all is redeemed by this aside

“The U.S., (if it doesn't accept the model of debt peonage to a rapacious plutocracy and foreign powers, which Alex Tabarrok no doubt favors)”

ecce
the artificial ground rent vampire

we've “produced “

in the cause

of zoning amenity

paid out
partly as real estate taxes

and

partly as lot value based mortgage

interest payments

…
” Why is that zoning regulation and population growth fundamentally changed the nature of the real estate market starting in 1997?”

brad delongeurs et al
had a way

suddenly bumping up against
the limit of ” rational job commute time”

anne
i think the optimal forex path

is a very complex critter to locate

indeed

all your plus points are gotten at by other means
then de industrialization

a post industrial policy for say …las vegas

is one thing

for north american —save mexico — quite another

beyond a dollar policy that rapidly leads
to an external balance

in the value of our material product trade

i submit
we need a more radical industrial policy

where its technically feasible
build it here

build it green/clean

build it right

and

build it for productivity max

warning this is hardly a jobs protection policy
to the extent we automate out

routine production jobs all the better

provided we the people of earth

rip away the trans nats

national can openers —-their control

thru IP barriers of fronteer techniques —-

the 2.5 billion souls of china plus india

can develop quite nicely without

de facto de industrializing the north of america and the west of europe by export trade booms

where we agree anne you cosmopolite u

i believe we need a statue of liberty immigration policy

every one please come here

now i caution the balance trade dollar will
reduce the “take back home ” value

of your compensation

but still…

citizen ship ????
to me this is the real

spartan / helot bug a boo

even full employment of a vickrey kind
prolly won't end effectively

our paleface fears of swamping

…
” too much is riding on the remnants of the strong dollar policy”

yes the north south capital export friendly
high vs south dollar policy

tasks us

with its haunting haughtiness

its a tans nat gig thru and thru

for those with
a balanced and rebalanceable portfolio

of trans nat issues

what me worry

but we the work a job day weebles
are fast losing our ability

to make our way up in the world by our own products

its detestible to think

this nation that was once the arsenal of democracy

might well become a nation of deputies

deputies
of the globe's self appointed sheriff

…
“are you saying that you would like to see global creative destruction of the currency regime, rebalancing etc.?”

i think what would be best for the planet and its people

is not possible without a total make over of

the trans nat hi fi system

and without a world governing body
a total make over is also not possible

up shot
“…it seems …that (any ad hoc posse of north nations ) rebalancing runs a high risk of war and famine.”

…
that being now off my chest

“what would be the best case scenario in your view? What should the fed/government be doing?”

about everything
in the way of credit interventions

it can get to fly politically

both locally and globally

and right now

and multiplied by 100

“Doesn't the falling dollar act as a Smoot-Hawley tariff?”

yes but its only globe macro bad

if others try to counter it

by say

trying to re raise the dollar

or by a similar de-val attempt of their own

only if there;s a pandemic of devals
can we get the menace of chronic era long type

real cross border trade shrink

btw

my take

poor old smoot
and the industrial babbits behind him

get the horse collar

that far better

ought to be hung

around higher necks

hi fi necks

city and wall street necks

t'was the gathering effects of the draught
in cross border credit flows

not trade in real products per se

that killed the 20's boomlet

…
“This will force foreign central banks to buy our dollars in an effort to rebalance trade.”

yes if they choose not to allow the drop
vis a vis their currency

as the euro's have so far

for peggers t'is true

”.. in a way inflating the economy, with regard to foreign trade vis-a-vis
the U.S. is a heads I win, tails you loose situation.”

that pretty well covers the world reserve currency advantage the imperial dollar holds
regardless of global market conditions

add to it forex manipulation

of low ball traders like china

and we can

live beyond our real makings …so to speak

paradox by doing so we shrink our capacity for makings however

and must bust the pegs
or burden the non peggers

by a distorted exchange system like we have now

ps caution to exploiters of imperial privilege

the flow size of the advantage will vary

depending on
other nations trade gaps and reserve TARGETS

…
” Current policy does not differentiate between the two”

really ???

“Default can be very dangerous, as default can eliminate further extensions of credit”

if u'd turned over the present economy
maybe three or five years ago

i bet you'd;ve

found

the above line by price

on the warning label

…
price

its always a good working principle

to assume speculators exist

and have really good access

to credit lines

just when the shouldn't

speculators are not buying to use but to sell
or to hold

they are often called investors

its a name they like

like hoarders like the name savers

some folks like to say
investors by to hold on

speculators buy to sell out

in other words its all a matter of

how long you intend to

hold on

some say its whether you buy
for intrinsic value

or market fad

in my arrogant opinion

if any one is actually an investor

if one actually exists

she/he's only
not secretly a speculator

because they are either hapless rubes

primed for a skinning

or an even bigger thief

shooting fish in a barrel

like david m reubinstein

Posted by js paine at 12:36 AM

i love it

not just simple commodity price inflation
but even product price inflation

at the same time

as security and land lot price deflation

and of course wage stagnation

look at the slippery bald mountain top
revealed

when answering this basic question

“What is potential output? “

“…It is the level of output
that an economy can achieve

when prices and wages adjust

in a perfectly flexible way

to clear markets.”

what ???

oh a notional notion of never achieved
perfection

well no

not in practice in practice its

“Essentially … the level of output at which an economy tends to be on average”
ie

a post facto statistical artifact

its all there the evidence we need
to find yesterdays nat un-rate

hidden in the numbers boys and girls

however its
subject to

”.. structural changes…”

soooo looking ahead its

um …well we play it safe mostly
and stop well above the twilight zone

and how 'bout that 70's show

talk about a series of goofs !!!!

the potential output was over estimated
cause the trend increase in output per hour

slowed and …

well the fedskins plowed fearlessly

right smack dab into terrio inflatio

errrr …over and over again

till the days fabled in the opera cycle

der miller time

und

volckerlungenlied

und

der ride of der reaganwafffle

…
now comes gerry tight wire walking

“If potential output growth were slowing

or the natural rate rising….”

that double dip is just the beginish bit
therres a solid pair of paragraphs

ready to topple into thin-est gibberish

the logical floor under this stuff
is much too far below the wire

“…potential output growth ” ” slowing”

“the natural rate ” ” rising”

later there's

“rising ” “risk premia “

its a veritable
velspergustnochkle sandwitch

he's got stacked up here

spectral sensitives rally to the cause

such has
near twenty years of

non stop greenspanish

helped michael savage

our hi fi lingo

…
look

face it

the only inflation hard to steer

is wage profit supply side inflation

so are you interested in
nominal wage control ???

then apply
MAP TO THE BIG CORPS

attack
that algebra phobic

gallbreath guy's admin price sector

or planning sector

right by the short limited liability hairs

and

put it into a lerner type mark up market

ohhh sorry
that would be neo-socialist

never mind

“alternatively, throw sterilization to the wind, and print money, gosh darn it, as much as the bastards need, risking inflation and dollar collapse.”

i know you can be jaunty
so i risk seeming ponderous

but my premia are all paid up

ask gerry

so here goes three Q's in quest on an ..A

“throw sterilization to the wind “

not sure we use that word the same way
i use it to mean keep high powered money increases

from inflating

the product markets

“print money, gosh darn it, as much as the bastards need”

need or want ???
if its really need

plan for screwing

“risking inflation and dollar collapse.”

do u mean run away product inflation

because of wealth effect final demand
or because commodity prices filtering into

household operating cost

might trigger galloping nominal wage demands

if the secomnd type
now we're so globally open

i say

” man oh man

send it baby send it “

err but then

what is meant by a bruce wilder

when he prophetizers

dollar collapse

operation -ally better then sterilization

” ..toxic sludge which is Citigroup's balance sheet”

no way that's getting to the real economy any time soon

“a war in Iraq “

out right real destruction trumps sterilization

” tax refund checks for people

who don't really much need the money”

they might buy something new and real
so leakage here

“Maybe the Fed can open the discount window to hedge funds and large traders”

james
i knew you were a wall street spec tart

but … spreadin for hedge funds ….

Posted by: paine | Link to comment | March 20, 2008 at 01:28 PM

paine says…
spectator

that's catnip quoting mr K

Posted by: paine | Link to comment | March 20, 2008 at 01:30 PM

paine says…
case of

“never worry i see with my hands “

said by a blind man as he staggers down the hall

“There is no magical machine to print money - it comes at a cost to society”

could anything
contained in just two phrases and 15 words

be much more dangerously primitive and wrong headed

…

“Why can't you just come out and say that Wall St was involved in illegal fraudulent transactions?

Accepting this fact is the first step in your recovery from fantasy land”

precisely
orgeous george

precisely

okay i give in

these kids we're really talkin about

are from the village of the damned

btw
what in hell is barry burbling

marble ous steve

by implication

condemns the free and private enterpise system

“A credit crisis is a phenomena of unconsolidated balance sheets. “

jan tinbergen i think called this secondary uncertainty
ie

not part of …”that's life bub”

but part of

the carry cost of running

an opaque by design enterpise system

to wax karlian

the credit system is a partial sublation of capitalism

as with any partial solution
trouble abounds at the contradiction points

seems every time
the bridge building crew

are just about

to reach the far side of the river …

recall
penelope's loom and the suitors

…

“A few days ago, on the von Mises Instititute comment thread”

kill shot you poor dear if i'd known you needed
to talkso desperately you vamped for those ship in a bottle types

over at capin' von's con shop

i'da invited you

to my blog for a pranging

killer

you run the credit system so close to the money line
you may have forgotten the ultimo commodity

shineful metalic money

locke the guy who said posssess
ends at spoilage

let the whole exploitation game

pass thru

by introducing

that single mine shaft

money of real scarcity
acting as medium of exchange

plus store of wealth

and not yet means of payment

still strictly avoids promises

a in god we trust everyone else pays cash
world preserves

the lockean world of 6 billion crusoe islands

Posted by js paine at 10:22 PM

“In cooperation games, costly punishment is a detrimental and self-destructive behavior.”

ya but the exploiters of us jobbled ain't about co operation
but co optation

now the helots are enraged they're calling for sensible solutions
not samson pull down that temple on em shit

“Put simply, winners don’t punish,” says co-author David G. Rand of Harvard's Program for Evolutionary Dynamics and Department of Systems Biology. “Punishment can lead to a downward spiral of retaliation, with destructive outcomes for everybody involved. The people with the highest total payoffs do not use costly punishment.”

but then

you can beat up some useless bums

to get the anger out …right ???

“The house of cards is the more apt analogy. Any ideas of propping up same are daft. There was nothing behind the screen at Bear Stearns. How many other Bear Stearns? And, there is nothing behind this whole 'service'/'financial' economy”
i agree

the approach is wrong ended

gotta get the base fixed
by uncle buying up

all the original mortgages

any one wants to sell

at face value

will cost zillions but

money costs uncle nothing

inflation

hey the green toes were fearing inflation
from 1930 till 1940

meanwhile we ideled one third of a nation

on and off for ten years

the tumble down won't end till we 
force uncle to stand ready to buy up

all america's house lot debt 

———

steve waldman
a guy i can't get warm over

has this story to mirror

the basics of the present credit crisis

its our gang vintage

qutesy crap

about kids promising each other marbles

to do their chores for em

upshot promised marbles exceed real marbles …blah blah blah

its really tedious and whats more others
begin to embroider and restitch

so i rip it …some

———

god people of this site:

hark on to me

there are many solid
reasons the extended allegory

is today

as dead as the mid-eval catholic church

somethings are even more tedious then raw algebra

but mark as much as the fabric bores me
i commend your pains taking

reweave

======

is it really true

you can't punish people productively ???

that is unless you make their punishment
be more work

most economic punishment
job loss company bankruptcy

reduces the right now aggregate work put

and from a design of the whole persepective
we need to max the long run social work put right???

given the wild ride we call

progress thru corporate capitalism

with all its spells of idled real capacity

at what point

do we say

enough of this alibi for episodic slackery

forget the clever counter

to the venerable old adage

“a minute idle is a minute lost

to the great satan”

is it actually true

in a systemically unconstrained setting

that

“we lose long run work put

by following to closely this

homely heuristic

about full playgrounds

and empty job sites

the sack is costly punishment …eh ??

“Our finding has a very positive message:

In an extremely competitive setting, the winners are those who resist the temptation to escalate conflicts, while the losers punish and perish,”

the contemporary for profit corporation
must play a dominance game within a co operative game

thus its moliere like quality

punishment or simply rewardless outcomes
for one sort or other type of employee is de rigeur ..eh ???

to step outside the corporate veil
and start to call

any economic system as a whole

built primarily out of these components

a co operative venture ….

say what ….?????

“researchers have suggested that costly punishment can compel cooperation in one-time interactions “

that's not anymore relevent here
then repeated interactions

i think many people want to

single out a few big bad thumbs

for a last time interaction

poed portland

you sound like a fraud or a fool or both

reading your tale
leaves me kold

saving for a house
what amount how long

fear of inflation
get a non dollar fixed security

oh ya you want that all to go to hell so you can afford the house lot
with the credit props pulled out from under it

start with this simple heuristic
given the economy is so interconnected

you'll likely lose at one end what you gain at the other

“paine” the thing to remember is that savers, and people who have been paying down their mortgages, were minding their own business. They didn't make this trouble.”

rule one

first
punish the innocent

hey ” yet now you want us to cover you.”

no i want you to put “me ” in jail

Posted by js paine at 06:55 PM

note:

the consistent push for
monetary policy solutions

over fiscal policy solutions

to effective demand dirth

has a deep class conflict basis

if the direct effect of policy

is to say stimulate

“… aggregate demand

by raising other asset prices…”

ie provide a market demand

to prop asset prices

versus

job creation programs

put it another way
do u use policy to

effect “inflationary epectations “

or

to effect

employment expectations

which side are u on… pard ????

Posted by: paine | Link to comment | March 19, 2008 at 08:37 AM

paine says…
Sustainability

read carefully and pondered
thru a wage class persepective

you make a second or contradictory
“dual argument “

a non saving majority
ought to provide

a better electoral basis

for macro policy

that directly targets

wage and employment prospects

vs

“real” asset values

Posted by: paine | Link to comment | March 19, 2008 at 08:43 AM

paine says…
it is really absurd

to talk about belt tightening

lessons

aimed at

the bottom (half nots )

of amerika

these boobs rubes chumps

and do hickery docs

haven't seen a real “sustain-ble”

raise

in hourly pay

for almost 30 years

Posted by: paine | Link to comment | March 19, 2008 at 08:47 AM

paine says…
ddt :

“Here's the thing:

you have to actually let those asset prices fall and recognize losses in order to limit inflation”

make way for the somersault !!!!!

asset prices less -> product prices less

now i agree
to hell with

the great rentier bourgeois navel gaze…

to hell with

“where will this put my portfolio ??”

fine now house lots suck horse apples
let all other “unreal asset values ” plunge too

its a bifecta turning polyfecta

but
why fight to ” limit (product) inflation ” ???

the older u saw clearly
its like preparing

for a forest fire

in flood time

Posted by: paine | Link to comment | March 19, 2008 at 08:59 AM

paine says…
“Are we over-invested in the financial sector and under-invested in other areas? If so how do we correct the “national investment portfolio”? “

are you talking about large sectoral
asset price adjustments ..but among assets

or

large adjustments

between asset prices and product prices ??

Posted by: paine | Link to comment | March 19, 2008 at 09:03 AM

paine says…
james

put your “fiat ” money mania aside one moment
and help me see where you're coming from

which class of americans
need to take

the “real ” hit here

wage earners or rentiers ??

Posted by: paine | Link to comment | March 19, 2008 at 09:06 AM

paine says…
“Real rates are negative, even in some TIPS. Lenders are literally paying people to take loans “

howz that anything but a borrow now
deal ploy

no different then a prez day

” this weelend only

take an extra 30 % all our mattresses ”

Posted by: paine | Link to comment | March 19, 2008 at 09:09 AM

paine says…
Gerard MacDonell

credit volume is what
any deals really about

if the rates zero
but you don't get the loan ….

“But if you create a negative real interest rate, then people are forced into spending”

no they can save all they want
they are only forced to avoid unadjustable

fixed dollar pay out instruments

—- for that matter

you could buy any

real store of value ——

don't conflate the need to run a full employment
effective demand policy

with price level management

looked at on its own
its not necessary to maintain

price stablity

just price change predictablity

the policy vice is producing
unanticipated price level changes

blooms of inflation

that over turn

the expected value

of fixed rate dollar denominated instruments

ddt

look at euro commodity prces

is this domestic inflation just part
of the dollar drop price tsunami

if it is

welcome oh big wave welcome

i agree we ought to start working with
realistic “notional ” ground zero

dollar asset prices

not the present pro tem

proptronic fed

parachute make nice

sky floatin' 'values '

but i suspect the big boys already are

as the real value of the dollar declines
trillions start to look manageable

Posted by: paine | Link to comment | March 19, 2008 at 05:42 PM

paine says…
“Possibly I am thinking too much of Japan”

anne my dear one can never think to much about japan

for the rest of god's “advanced ” nations
japan's wacked out fate

during the past 15 years

acts like the column of smoke that led the hebrews

by day

thru the desert

40 years of wandering ???

yikes

Posted by: paine | Link to comment | March 19, 2008 at 05:46 PM

paine says…
“Ideology run amok. Till the Chicago mafia is usurped, there will be no change. The untold aim of the mafia is to usurp all laws that prevent pillage and looting, all in the name of “choice”, “free-markets”, “liberty” and what not”

i like your take billy

though i see the chicago types
more as a mad combo

of

temple priests and tent show preachers

then as the real wise guys

“Ideology run amok” indeed

but in the service of
the one and same ” chosen of God “

ie

the cross border

limited liability profiteers

released in stages

over the last 35 years ago

from the bindings

of the new deal / kold war

social contract

and Mammon looketh
apon their unboundedness

and saw it was good

Posted by: paine | “Doesn't the falling dollar act as a Smoot-Hawley tariff?”
yes but its only globe macro bad

if others try to counter it

by say

trying to re raise the dollar

or by a similar de-val attempt of their own

only if there;s a pandemic of devals
can we get the menace of chronic era long type

real cross border trade shrink

btw

my take

poor old smoot
and the industrial babbits behind him

get the horse collar

that far better

ought to be hung

around higher necks

hi fi necks

city and wall street necks

t'was the gathering effects of the draught
in cross border credit flows

not trade in real products per se

that killed the 20's boomlet

Posted by: paine | Link to comment | March 20, 2008 at 08:30 AM

paine says…
“This will force foreign central banks to buy our dollars in an effort to rebalance trade.”

yes if they choose not to allow the drop
vis a vis their currency

as the euro's have so far

for peggers t'is true

”.. in a way inflating the economy, with regard to foreign trade vis-a-vis
the U.S. is a heads I win, tails you loose situation.”

that pretty well covers the world reserve currency advantage the imperial dollar holds
regardless of global market conditions

add to it forex manipulation

of low ball traders like china

and we can

live beyond our real makings …so to speak

paradox by doing so we shrink our capacity for makings however

and must bust the pegs
or burden the non peggers

by a distorted exchange system like we have now

ps caution to exploiters of imperial privilege

the flow size of the advantage will vary

depending on
other nations trade gaps and reserve TARGETS

Posted by: paine | Link to comment | March 20, 2008 at 08:41 AM

paine says…
” Current policy does not differentiate between the two”

really ???

“Default can be very dangerous, as default can eliminate further extensions of credit”

if u'd turned over the present economy
maybe three or five years ago

i bet you'd;ve

found

the above line by price

on the warning label

Posted by: paine | Link to comment | March 20, 2008 at 08:50 AM

paine says…
price

its always a good working principle

to assume speculators exist

and have really good access

to credit lines

just when the shouldn't

speculators are not buying to use but to sell
or to hold

they are often called investors

its a name they like

like hoarders like the name savers

some folks like to say
investors by to hold on

speculators buy to sell out

in other words its all a matter of

how long you intend to

hold on

some say its whether you buy
for intrinsic value

or market fad

in my arrogant opinion

if any one is actually an investor

if one actually exists

she/he's only
not secretly a speculator

because they are either hapless rubes

primed for a skinning

or an even bigger thief

shooting fish in a barrel

like david m reubinstein

anne
i think the optimal forex path

is a very complex critter to locate

indeed

all your plus points are gotten at by other means
then de industrialization

a post industrial policy for say …las vegas

is one thing

for north american —save mexico — quite another

beyond a dollar policy that rapidly leads
to an external balance

in the value of our material product trade

i submit
we need a more radical industrial policy

where its technically feasible
build it here

build it green/clean

build it right

and

build it for productivity max

warning this is hardly a jobs protection policy
to the extent we automate out

routine production jobs all the better

provided we the people of earth

rip away the trans nats

national can openers —-their control

thru IP barriers of fronteer techniques —-

the 2.5 billion souls of china plus india

can develop quite nicely without

de facto de industrializing the north of america and the west of europe by export trade booms

where we agree anne you cosmopolite u

i believe we need a statue of liberty immigration policy

every one please come here

now i caution the balance trade dollar will
reduce the “take back home ” value

of your compensation

but still…

citizen ship ????
to me this is the real

spartan / helot bug a boo

even full employment of a vickrey kind
prolly won't end effectively

our paleface fears of swamping

Posted by: paine | Link to comment | March 20, 2008 at 10:27 AM

paine says…
” too much is riding on the remnants of the strong dollar policy”

yes the north south capital export friendly
high vs south dollar policy

tasks us

with its haunting haughtiness

its a tans nat gig thru and thru

for those with
a balanced and rebalanceable portfolio

of trans nat issues

what me worry

but we the work a job day weebles
are fast losing our ability

to make our way up in the world by our own products

its detestible to think

this nation that was once the arsenal of democracy

might well become a nation of deputies

deputies
of the globe's self appointed sheriff

Posted by: paine | Link to comment | March 20, 2008 at 10:36 AM

paine says…
“are you saying that you would like to see global creative destruction of the currency regime, rebalancing etc.?”

i think what would be best for the planet and its people

is not possible without a total make over of

the trans nat hi fi system

and without a world governing body
a total make over is also not possible

up shot
“…it seems …that (any ad hoc posse of north nations ) rebalancing runs a high risk of war and famine.”

Posted by: paine | Link to comment | March 20, 2008 at 10:43 AM

paine says…
that being now off my chest

“what would be the best case scenario in your view? What should the fed/government be doing?”

about everything
in the way of credit interventions

it can get to fly politically

both locally and globally

and right now

and multiplied by 100

Posted by js paine at 06:02 PM