amazes me folks
miss the point about central banking

the credit system only works against the little guy
because its controled by the big guys

the answer is not to abolish it
old hickory style

but to sieze it

and run it according to our interests

examples of the long chain of class grifts
pulled off by the silk hat set

using their intrinsically costless credit creator

only makes my mouth water

———

the gist of a pure credit system is this

balance sheets can be change in an instant
if you can run a hose from the central bank to your balance sheet

there is no meaning to insolvency

native americans may have had a phase of awe and fear mixed with hatred about the white man's fire sticks

but soon enough …

Posted by pinky at 03:13 AM

goodwin's model
is pure peanut brittle

its tech change is disembodied

and its accumulation rate rigidly parametered

the prey is capitalist accumulation

like knight's crusonia plant

the predators ???

the wagery hogs
a parable of interdependence …very soc dem eh ??

if you believe the direct producer is best modeled
as a predator

u've strayed far from the classics

the extractor of value
is the predator

not the producer

and the humble point wage funds
limit accumulation hardly takes

necessary institutional form

as capitalism eh ??

the model of the reserve army can drop right out of efficiency wage models

varying system wide job rations

not to maintain social accumulation

but maximize surplus revenue

has detailed consequences not captured in godwins stick figure fable of orbiting class shares

so
not only is the cart placed firmly in front of the horse

the cart pulls the horse

and besides the cart and horse both

lack essential moving parts

for the record the godwin model

is an aesthetic delight

confession for the record:

in grad school back in the bogus end of the 70's
i tried to marxicate godwin's parable

by the simpletonian device

of turning it upside down

having the profiteers generate labor saving tech
to cut job hour demand and thus wage share

only to find profits falling slowing tech change

and blah blah blah

but i soon realized

i was operating with about 39 cards missing

out of the full deck

i needed to play

modeler of “der kampf”

Posted by pinky at 02:29 AM

“the models economists have been using do, in fact, help us find answers to some important questions. “

really ???

like what ???

monetary policy
in a time of

stagnant real wages

over priced dollars

industrial disintegration

wrecked pensions

wild climb medi costs

rampant asset prices

commodity voodoo

credit gluts

lot bubbles

ipo scams

assorted manias crazes and ponzis

you “think” u may have
kept the change rate

of product price levels

……. moderate

by using that hand axe tool

the taylor rule

i'm impressed

volcker did the heavy lifting
reagan the union busting

both by brute strangulation

add on

open border trade

massive payments deficits

trans nat scrambles and arbitrage

what's left for greenstain to do

besides trigger a needless

“i'm spooked ” recession

and allowing us job smurfs

to borrow what you kept from us in productivity

based wage increases

lets go back to identity politics
as in supply must equal demand

weages must equal marginal products

trade must reflect

comparative advantage

i prefer stilted tautology as dogma
to stupid rope tricks

…
don't blame algebra

blame class politics

buiter
btw is worse by far

then the ivy new keynesian guys

they're just timid middle way prufrocks

go ahead alfred eat the peach

i think the question u need to answer for yourself
is why “we” the main stream macroites

asked the wrong questions…for 35 years

after…after

ratex and the anti keynes posse rode into town

and “math up “-ed

uncle milty's curse

come on the wage price spiral was a serious problem in the late 40's
read abba lerner

full employment meant something like niaru or nairu
way back then

come on peace time full employment
as a macro target

died in 1946

again why was the main stream playing
— as bark e bark nicely sez —-

with toys that proved ratex consistent

with price/wage stickiness

why the love of monetary macro
and the retreat from fiscal macro??

late vickrey macro pre dates this catastrophe
by 17 years

and when the call to arms came
after all these years of comparative

ease and grace

global market reality

made the main frame woodfordites

with their expectational clap trap

look like

the french army at sadan

too bad no new york commune will come out of this

routing our academy ain't
quite like routing our military i'm afraid

” If the Fed could credibly commit to inflation at rates higher than the 2-ish percent target it’s already believed to have, that would be effective.”

that is high octane new k think
by our boy at the corner

of times square and nassau hall

its inside out
and maybe upside down

string pushing magic act
levitate price tables

aby reanimating the corporate grr-animals

its hoodoo
because its expectational

voodoo

but if some one said

oh we can make that a fact
by

a massive 5 year deficit surge

ie
fiscal policy ….not monetary

that would be late vickrey and insane
it would be

win the war crusade in europe insane too btw

needles to say

monetary policy ie credit policy for pigeons

meant this

we can manage effective demand thru upping household credit purchases as easily as uncle
credit based purchases

only the fallacy of that is obvious
uncle can always pay the vig

no matter where it climbs to

but

we weebles can't

two points are typical corporate objectives

nominal wage control
and

wage share minimization

this left to spontaneous market forces
leads to chronic consumption deficits

the greater the shift in income shares
away from wage slingers

the greater the need for easing household credit

to maintain consumer demand

but where's the hostage where's the collateral
that the weeblers won't walk away from

a scheinvert prone house lot does the trick
or at least did the trick for 20 years

“just because you don't read about them in the WSJ or in blogs doesn't mean it is not done”

no but it prolly does mean
that type of analysis has been effectively marginalized

the list of existence proofs so to speak
with regards to published academic models

of

market incompleteness

expectational inconsistency

and lack of product and preference closure

of hi fi layers with defaults

or non market clearence or rationing or or or

scattered out there among the 50 top journals is probably the answers to todays quesztions

or at least the elements of those answers

so what

that

proves nothing in itself

absolutely nothing

beyond the possibilty of another course of main stream research
a course not taken

so why wasn't it

if policy ignored them
and followed other pathways

for 30 years …30 years that led

to this display of abject and total incompetence

a state of near shock

before the present earth wide debacle

are we to believe the leaders of the profession
felt to their toes

the present global market regime was unsinkable ???

i doubt that

where is the big time economist prepared to gasp

“my god i've wiasted my career i've failed totally
and its because i never ever thought

anything remotely like this

could actually happen”

no way
and its not just bluster and vanity

most good economists

simply played the game by the rules

and the rules said
don't model stuff that implies

any institutional crisis down the road

assume this system is stable forever

leave catastrophes
to the marginal creeps

again
if policy ignores the exceptions

and follows other pathways

for 30 years …why becomes the main question

“When things are going well, the opportunity costs of survival strategies appear unreasonably high.”

nice point
most cruise manpower oughta be directed to stuff other then sinking drills

that is

unless your in charge of the life boats

macro oughta have quite a contingent of life boat specialists

Posted by pinky at 12:30 AM

my peerless leader
snuffington j smiff

finds uncle in the land loan biz a perfect horror



well consider the following one and all

including u squire Allsmiffy

Okay so mr and. Mrs sprawl
need a place to store

Their household savings



well there's Precious metal

and there's land

the classic stores of wealth

We'll skip metal And go straight for land
Specifically

Land in the form of a house lot

as that's

Overwhemingly

The chosen path of

plebian

Folks like the sprawls

Particularly

Here in the land of amber fields and parking structures

As a store of wealth house lots are a pip
So long as a house holder

Sticks to the polonian way

And remains free and clear of debt

or at least strive to become

Polonians by paying their mortgage off

the free and clears come in at about one third

of our 75 million

Strong fleet of house lots these day

Now
Comes a big down market

And these small taters

are free and clear

Even if in real terms

They've taken a hit

to their stored wealth

gold would have survived

But the other two thirds

Face a bigger risk

if their lots market value falls Far enough…

Err since their mortgage's outstanding principal

of course

Doesn't adjust to drops in asset market values

…cometh the great panic …

And their suddenly operating out of

a sunken house wealth wise …A tethered submarine financially speaking

no longer
a store of wealth

but a mere hideous little debt sump



what now ???

The tale obvious starts and ends
with its genie

http://4.bp.blogspot.com/_iAh1gEL06ak/SZYcmPObTwI/AAAAAAAAETI/K4h5fGI9wE4/s320/genie.png



uncle is said genie one wish wonder :

the magic market trick called Capitalized Ground rent CGR for short …is CGR a Particle or a wave

rent or interest ???…well it's both …Capitalize ground rent or amortized lot value

Charge rent or interest… six of one half dozen of the other

Ground rent is the market value of a certain number

Of square feet of ground space in a certain location for a certain period of time

Its ultimately link to its use value of course which itself partakes of the intricacies
Better left to clio

The rent or its interst payment equivalent
Is a social product

Optimally captured by society and not left to Households anymore then

it oughta be left to the duke of westminster

Conjecture:

The episodic undulations
Of ground rent

Are best riden by the whole people together

With individual variations of guile and fortune

Playing a minimalized role

So how do we construct a quasi raft
for all of us ??

ie

how can we float

As one…all of… us… Together

above the Inevitable unforeseeable

Complexities 75 million lots

all being hit always

With these highly variable

Local value waves





by uncle making

each of us

an offer we can't refuse or confuse

a mortgage on our lot's market value
at a super sub market arm-ed interest rate

no principal payments until and unless sold

fully transferable etc etc etc

no risk as
principal value of mortgage adjusted

at time of sale

to prevailing market conditions



upshot uncle captures all the lots in amerika

as if he'd nationalized em

and became our landlord

a few yeoman hold outs ??? so what

i bet of the 25 milion free and clears we'd seduce most



point once uncle holds the paper on all the lots

uncle can control their value

in fact over time the sprawls will only think about what they borrowed on the house itself as a mortgage

the lot value will look like a land tax …yup george time in america folks



http://www.etsu.edu/cas/history/resources/Private/Faculty/Fac_From1877ChapterDoc/ChapterImages/Ch18HenryGeorge.jpg



ya ya there's much diabolical detail here

but trust me

the knots are all cut thru here

its merlin paine in mid season form



wooooow ..there owen what about the store of wealth bit ???

if the mortgage principal is market value adjusted
at sale time where's the store age

there's a whole in the bottom

you're right



just a teaser to draw in you scots pleb heads

and

monkish acolytes of the abstaining wet blanket cult



forget it forget saving like hair shirts its for suckers



given my ultra loose uncle backed credit systems



owen kills savings like mcbeth killed sleep

Posted by pinky at 06:41 PM

do u feel like the second shoe don't wanna drop ??
are u up nites wondering where's the final splatter ??

whats kept us suspended here betwixt the devil and the deep blue sea ???

well fans they call em built in stabilizers and they are what's left of the post Great Depression economic structure

these critters increase when all else decreases and decreases when all else increases

and by doing so tweak the market systems inherent dynamics …

buffer and boost in turn both tame the tiger and embolden the sheep



and in graver times times like these even in their weakened condition

they may keep collapse at bay

and soften the landing



automatic is the key word here without any discretionary act

a visible mechanical uber hand





but there's a fearful symmetry here

over all built in stabilizers

— at least to the extent their realization fits their name anyway—-

since they not only take the bust out of contraction

but also take the boom out of expansion ..

need i say more …

putting a governer on the upsides speed

leads to what else ..the inevitable chafing in times of gathering spontaneous acceleration

…times obivously quite opposite to ours now

but times like the ragin 70's



over the past 30 year reign of reagonomics

praises for our built ins went sung … well bug collecting academics might chant quietly a song of praise

now and again but even as discretionary gubmint measures retreated back inside the last bastion of fiat economics …the federal money temple the built ins did their work undaunted by the slaughter of their brethern

and there was much slaughter and yes the built ins of today are not the built ins of carters day

“but a tattered remnent “



like much else good and bad because the built ins were by their design

” automatic” ways and means

they tended in public discourse to fall into the unobserved back ground

when they were “helping ” us

but like uncle's fiscal deficits and the nasty union rump

the built ins come boom time were explicitly viewed as part of the systemic tyranny

in the public discourse the regs and rate structures joined

the rent guzzling monsters uncle grows in his fevered hot houses

the makings of that super imposition on society of concious anti-promethean institutions

that cripple the good life and kill the better life and yet year in year out scorned and decimated as they were

the built ins did their job



their quiet dispatch allowed a shared delusion to rise among us

the time before franklin R was a better time -so long as u were white —



back then when only ad hoc musterings countered our household perils

where we faced  one god damn  un co ordinated market herd move after another

all alone and even if unafraid totally without rights to recompense

we were better off ..freedom self respect discipline responsiblity

though struck down by forces beyond ourselves with the ability to resurect

ourselves thru the state we were better off  subject only to the tender mercy of the fortunate among us

no one actually believed this i suspect as events now will prove but …it was a nice alibi for selfishness eh ??



okay so in sum these critters

these built in stabilizers

now in place for up to 70 years

have born humble witness to the goodness of designed intentional institutionalized progress

like sumps in the cellar



needless to say

as with lots of clio's major developments

this system of built ins has evolved as much thru the on going destruction of received institutions

like the roman catholic church

as the installation of these new ones and often the old must be destroyed before the new can develop



enter the reagan ites and their mongolian harvest of all things new dealish hog tieing and Mom-ish

reaganism destroyed the welfare state as i knew it ..bravo

but okay the pricks had their deck clearing mission and they done it

that today is suddenly the political economy of yesterday



untill a second ago the hegemon among nations was devoted to freeing itself

and its sister nations large small rich or poor from the drawing strings of nannydom

but today in a flash we're all at once again all about each others welfare

we are entering a frenzy of restructuring all the way from the micro bevy of market specific quotas bans and other internal and cross border regs to credit re-gearings and even job site remakes —and of course the usual string sectioon

of taxes and subsidies—- a tidal wave of  mandatory… universal .. for everyone …” its the law madame ” type

this-ings and that-ings



but relax whoever u are and from what ever class perch you peer

folks lady's and grooms …its all part of Clio's travelling circus



the market policy reform cycle is fairly clear to anyone able to count past two

particularly now after the last couple three centuries of faustian cavorting followed by bovarian suicides



this all is no longer bold conjecture its now self evident banality



we moderns build new …state induced … institutional structures over our markets in times of bust

and remove scads of “old rotten defective “ institutional structures in times of boom

that's the concious deliberate socally co ordinated part at least of our market economy and its evolution



—-what we allow to institute itself spontaneously within markets themselves in good times

and watch explode spontaneously in bad times is another story of course ——



so how about now ???



well here's a maxim for starters:



product markets may and often do fail 

but asset  markets collapse 



and in the after math of a collapse

the state with its comulsions  to “do something..anything ”

becomes the vehicle of innovation here as much as blunder

not surprising this …is there any substitute for the state

when self-rescue requires of us as close as possible to universal conformity ??

okay — as one must expect — where interests are diverse and often rival

whatever we thru our gubmint ” choose ” to impose as 

the new deliberate mandatory superstructure can be seen by huge chunks of the polity

as bad bad bad ….naughty naughty naughty …mean mean mean

unlike any non spontaneous social process emerging as if by a …whatever

from within civil society itself

state action can't be made to look ..well …like a rebuke by god or mother nature 

state action's wounds to its society below are we or at least them inflicted

thus evil as in man made un nartural imposed inorganic mechanical rigid artificially induced confining

freedom starving violating civil liberty traducing god playing acts of the Devil's dsciples etc etc etc



come a crisis in the markets the state supervising those markets

can not only play devil with them and its “innocent participants “

but usually the state also discovers in a fluke of victim desperation

operating with much much more elbow room ie more playground to evilize in







well the old moles have been about their work preparing the path to  our next new jerusalem

—-what N point o are we at i wonder —-

and just as obviously  somewhere in our network of ivy basements

the new paradigm exists if only in toy alegbra form ..a model train version 

circling thru its circles 

well i think the chosen one or ones

are circling and looping and over and undering down  in joe stiglitz's below grade den

and they've been doing so since the late 70's



paine's brassy oracular declaration:





doctor stiglitz  model train sets capture the schein essence of our future popular mind set

the mind set that will sweep all before it in the next dozen years

the ” latest ” top selling take on how the whole damn market earth thing works 

whatever  conflicted bevy and briary of figure eight topospheric run arounds

is out there torturing and rewarding us helots

lambot joe S prolly crafted its latest set of id bracelets err if not remedies



to be contuinued





being part two of

from where i'm at this recent massive market failure looks like the end of everything i know





okay lets go back to the post war glory days when my world was entering its suave majority

we find submerged contradictions and patent ones too 

even as folks —like kindly dwarf ken arrow —tried to re-justify our lost faith in the invisible hand

with stupid model tricks and even as the highest level visions of a highest possible social welfare

emerge at least as easily thru the unhampered untutored ungoosed supremacy of the voluntary actions

of stateless spontaneous property based market systems

the freshly born America's earth on street level was playing keynesian catch up

in a phrase

folks of college attainment were learning samuelson

all seemed if not in celestial motion at least “takin care of bidness” thru ike and into the new fronteer

yes by jack time our export boom was on the fizzle but all the new deal rigged built in stabilizers were working

their mild miracles of melioration sooo the wigs that be believed …err so long as our fucking price level  behaved

we could sail on and on and on …

and yet when in the high 60's trouble came in battalions to america's earth

the dred price level demons came too

and dreams of switch back moves spread like wild fire among the board room cowboys

“we gotta get back to the 19th century and fast “



the balls behind this

the let it be …touch nothing … tear down thus regs …remove those stablizers …leave it to kismet 

no policy is the best policy restoration ???

well what else i mean that is besides uncle milty's blind boy of the south side gibbering

18th century old testement moses smith hymns and squeeking his

“i told u sos…freedom is the only choice ” in the face of the wage profit war

besides that the faith was justified by hand waves toward those wonderland proofs by arrow and company

that the surest author of the best of all possible social outcomes was free booting marketeering systems

give or take an occasional debt jubilee that is

needless to say clio ironist to the last had seen to it that this ark of the faith

was about to crumble into its own contradictions



yes that wholey mundane enlightenment substitute  for devine providence

was about to take a wicked savaging at the hands of some ivy wonks



to be continued



next time enter the stiglitz generation

Posted by pinky at 06:39 PM

the hi fi system circles market earth from above but not
from beyond

it transcends but is not transcendental

Posted by pinky at 06:37 PM

Toward a peoples fed


Note well the asset deflation needs to hit

Product prices to be a full fisher dive so long as product prices and wages—naturally— continue at level or better….

In this light one has to laugh at those raising. Inflation fears

Product wages or lots gents which fear-eth u?

Relief department

subject

Household mortgages

There are about
ten trillion in principal valuoutstanding. On america's home mortgages

I figure Interest payments at a high 7 percent would be
Around 700 billion per annum around 5 percent

Of gdp

Now obs 50 billion plan to modifying the principal on some fragment
—

Maybe 3-4 percent—

of these outstanding loans

Allegedly an estmate of the default flow up aheadmaybe uncle

Would serve us all better

If he makes it go a lot deeper into the troubled waters by

Paying 1/3 of the due damage for a year…on….what… ??

20 percent of all outstanding mortgages

Much closer to the total

underwater mortgages out there

Right now

But why not think bigger
And pull. Off a massive re fi

The federal land bank

The household mortgage
Total is around ten trillion dollars

The interest payments must be under 700 billion

But what if there was a holiday for interest payments

Presenting

the Federal land bank

A gubmint bank that loans money
Equal to one hundred percent of lot value of a primary residence

—- when owner carry costs / rental ratios renormalize. We'll need a housing credit

For renters too but that's another post——-

The key meme here is
lot value not house value

No reason for uncle to get into the house loan biz

Anymore then auto loans

Or domestic robot loans

See a mortgage on the full
Value of a lot

Amounts to capturing the present value of that lots

Estimated

Stream of ground rents

In other words the value of a certain chunk of land

Independent of what's

Built on it

but not

— notice I say not— independent of what governing zone codes Allow to be built on it

Now uncle can borrow for free so he can loan for. Free to
So a zero intro rate teeser oughta snag just about everyone borrowing on their homestead right

Now this would put private lenders eclusively in the

Comparatively Safe biz of house loans

———

facts scatter shot

median monthly housing costs for owners were $927 in 2007. For renters, housing costs were $755.  The median home value in 2007 was $191,471 and the median monthly payment for principal and interest was $852 for owner-occupied housing.

Half of the occupied units built since 2003 had a usable fireplace; 58 percent had a separate dining room.

Among the 75.6 million homes that were owner-occupied, 24.9 million units, or one in three, were owned free and clear without a mortgage.

3.75 million housing units had six people or more residing in the home.

From seasonal vacation homes to mobile homes, housing units in the United States increased from 124.4 million in 2005 to 128.2 million in 2007, according to the U.S. Census Bureau. The number of occupied housing units went from 108.9 million to 110.7 million.

Posted by pinky at 06:34 PM

help my fellow klavern members
with the paradox of grift

voluntary saving good

so called forced saving

or fiat saving bad

when and why

i note fear of reduced purchasing power per currency unit

inflation???
when ???

are we talking future fiat savings here

or a liquidity sponge that can soak up more much much more
without any effects even on asset prices

let alone product prices

some old crows need to try a new caw or two

“forced lowering of savings”

given our present perilous poise at position zero
ie

proto deflatio

that notion makes sense to me
sense of the policy

in light of the way it all works its way thru

….sinister sense
sense dripping the smegma of profiteer class cathexis

but

sense none the less

but what's the play
uncle buy up everything in site 

hold all the assets of the civil society

while civil society holds  the treasuries bonds and money

 can the sudden out pour of civilian money holdings get absorbed
into bondage so there isn't too much sudden effective demand

how is a revival of spontaneously increased effective demand on wanted when it comes
can't uncle reduce his roll fast enough ???

Posted by pinky at 06:26 PM