FabSwingers.com > Forums > Politics > The poverty of economic theory
The poverty of economic theory
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"Is there a link to it anywhwre online, I'd love to give it a read. "You can sort of read it on google books if you search the title and "peter drucker". It's only a short essay but it's golden in terms of straight to the point and not a word wasted. | |||
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"So are you saying that all the "experts" who predicted a massive crash after the brexit vote were talking bollocks? Or have you another point to make?" Let's no talk about Brexit! I made the point in another thread that some of the major election candidates for PM had made statements that showed how little they understand about economics. Most the politicians have some education in economics (PPE is a popular course for them) but I'm saying that what they've been taught is utter bollucks. I'm saying that our economy is in tatters and the 'experts' don't even have a functioning understanding of what the problem is, let alone how to solve it. | |||
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"Its only cyclical because human nature is. Just enough time needs to elapse for us to make all the same mistakes again and again and again and again. Human nature doesnt change that much really Adam? Smith hundreds of years ago was giving lectures on the wealthy having to pay for the state!. The reason that they couldnt see it coming wasnt that they couldnt see it coming.. They just didnt want to believe it, the evidence was all there pointing right at it. The maths guy in the big short was just going of maths, thats what the numbers were showing, the only reason he accepted the figures was his personality (some would say constraints). " I'm afraid i disagree. Some people who genuinely saw it coming (e.g. Warren Buffett) published articles predicting it. Search Google for "weapons of financial mass destruction". I don't believe any economist who seriously saw it coming wouldn't have simply published something on a website given the credentials that would come from predicting a crash of that size. They didn't see coming because most economists don't actually understand what economics is about. | |||
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"Perfect example of the horse shit that comes out of modern politics, moron of the first order John McDonnell is a self described "unapologetic marxist" wants to be a chancellor who makes decisions based on "fairness and equality". Firstly a marxist chancellor is an oxymoron, read the essay and you'll see why. Secondly, we dont need cock wombles talking about catch all terms like fairness. We need to have a long-term strategy for the effect of artificial intelligence on our economy, we need to have a plan for funding pensions when our population starts to decline and eventually we should have a clear policy on whether banks would be bailed out again in future. These are the real issues and instead we get drivel like that. Don't get it twisted, the tories are only a bit better, they've won two elections promising to eliminate the deficit and failed both times. " . We've had deficits for hundreds of years in fact I had a quick look. Since 1980 we've had 6 years out of 37 where we didn't 3 under Tories and 3 under labour. Its not debt thats the problem, its what you do with the debt. The guy who borrows ten grand and buys a big tv,a hifi, gadgets.. You don't see much return on your debt. However the guy who borrows ten grand and spends it on educating himself or tools or IT , his debt is working for him. So I dont get to worried about deficits or debt but what they spend it on.. Now Tories have a habit of spending less granted but they also have a habit of spending it on utter shit or stuff that just goes to their mates who then run off to a tax haven with it. | |||
"Perfect example of the horse shit that comes out of modern politics, moron of the first order John McDonnell is a self described "unapologetic marxist" wants to be a chancellor who makes decisions based on "fairness and equality". Firstly a marxist chancellor is an oxymoron, read the essay and you'll see why. Secondly, we dont need cock wombles talking about catch all terms like fairness. We need to have a long-term strategy for the effect of artificial intelligence on our economy, we need to have a plan for funding pensions when our population starts to decline and eventually we should have a clear policy on whether banks would be bailed out again in future. These are the real issues and instead we get drivel like that. Don't get it twisted, the tories are only a bit better, they've won two elections promising to eliminate the deficit and failed both times. . We've had deficits for hundreds of years in fact I had a quick look. Since 1980 we've had 6 years out of 37 where we didn't 3 under Tories and 3 under labour. Its not debt thats the problem, its what you do with the debt. The guy who borrows ten grand and buys a big tv,a hifi, gadgets.. You don't see much return on your debt. However the guy who borrows ten grand and spends it on educating himself or tools or IT , his debt is working for him. So I dont get to worried about deficits or debt but what they spend it on.. Now Tories have a habit of spending less granted but they also have a habit of spending it on utter shit or stuff that just goes to their mates who then run off to a tax haven with it. " I partially agree, our debt to GDP ratio is higher than any peace time period of the last 100 years so it's not like we've been running deficits without consequence. The Ministry of Defence is our 5th largest governmnet department, yet we now spend more on debt interest than we do on our entire defence budget. That's with interest rates at fuck all, what's going to happen if interest rates return to the long term average of 5.5%? | |||
"Perfect example of the horse shit that comes out of modern politics, moron of the first order John McDonnell is a self described "unapologetic marxist" wants to be a chancellor who makes decisions based on "fairness and equality". Firstly a marxist chancellor is an oxymoron, read the essay and you'll see why. Secondly, we dont need cock wombles talking about catch all terms like fairness. We need to have a long-term strategy for the effect of artificial intelligence on our economy, we need to have a plan for funding pensions when our population starts to decline and eventually we should have a clear policy on whether banks would be bailed out again in future. These are the real issues and instead we get drivel like that. Don't get it twisted, the tories are only a bit better, they've won two elections promising to eliminate the deficit and failed both times. . We've had deficits for hundreds of years in fact I had a quick look. Since 1980 we've had 6 years out of 37 where we didn't 3 under Tories and 3 under labour. Its not debt thats the problem, its what you do with the debt. The guy who borrows ten grand and buys a big tv,a hifi, gadgets.. You don't see much return on your debt. However the guy who borrows ten grand and spends it on educating himself or tools or IT , his debt is working for him. So I dont get to worried about deficits or debt but what they spend it on.. Now Tories have a habit of spending less granted but they also have a habit of spending it on utter shit or stuff that just goes to their mates who then run off to a tax haven with it. I partially agree, our debt to GDP ratio is higher than any peace time period of the last 100 years so it's not like we've been running deficits without consequence. The Ministry of Defence is our 5th largest governmnet department, yet we now spend more on debt interest than we do on our entire defence budget. That's with interest rates at fuck all, what's going to happen if interest rates return to the long term average of 5.5%? " who gives a shit ... it's all donkey wank apparently | |||
"Perfect example of the horse shit that comes out of modern politics, moron of the first order John McDonnell is a self described "unapologetic marxist" wants to be a chancellor who makes decisions based on "fairness and equality". Firstly a marxist chancellor is an oxymoron, read the essay and you'll see why. Secondly, we dont need cock wombles talking about catch all terms like fairness. We need to have a long-term strategy for the effect of artificial intelligence on our economy, we need to have a plan for funding pensions when our population starts to decline and eventually we should have a clear policy on whether banks would be bailed out again in future. These are the real issues and instead we get drivel like that. Don't get it twisted, the tories are only a bit better, they've won two elections promising to eliminate the deficit and failed both times. " I agree that the ageing population pension time bomb is the elephant in the room that gets ignored and its coupled with adult social care which is going to be hugely expensive.At the same time this will be occurring we could be losing a large proportion of tax paying individuals to automisation and A.I it's a perfect storm.AI will solve as many problems as it creates initially. | |||
"Perfect example of the horse shit that comes out of modern politics, moron of the first order John McDonnell is a self described "unapologetic marxist" wants to be a chancellor who makes decisions based on "fairness and equality". Firstly a marxist chancellor is an oxymoron, read the essay and you'll see why. Secondly, we dont need cock wombles talking about catch all terms like fairness. We need to have a long-term strategy for the effect of artificial intelligence on our economy, we need to have a plan for funding pensions when our population starts to decline and eventually we should have a clear policy on whether banks would be bailed out again in future. These are the real issues and instead we get drivel like that. Don't get it twisted, the tories are only a bit better, they've won two elections promising to eliminate the deficit and failed both times. I agree that the ageing population pension time bomb is the elephant in the room that gets ignored and its coupled with adult social care which is going to be hugely expensive.At the same time this will be occurring we could be losing a large proportion of tax paying individuals to automisation and A.I it's a perfect storm.AI will solve as many problems as it creates initially. " It doesn't have to, but it will because there's no strategy. For example, we could benefit from a cheaper london underground by scrapping the £60k a year position of train driver but because there's no alternative £60k a year job (that the current employees are capable of and actually needs doing) then we just get political stalemate. Royal Mail has a similar problem where they just recruit a huge temporary workforce and halt recruitment of full time employees to get around the problem, but it's not a real solution. | |||
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"Perfect example of the horse shit that comes out of modern politics, moron of the first order John McDonnell is a self described "unapologetic marxist" wants to be a chancellor who makes decisions based on "fairness and equality". Firstly a marxist chancellor is an oxymoron, read the essay and you'll see why. Secondly, we dont need cock wombles talking about catch all terms like fairness. We need to have a long-term strategy for the effect of artificial intelligence on our economy, we need to have a plan for funding pensions when our population starts to decline and eventually we should have a clear policy on whether banks would be bailed out again in future. These are the real issues and instead we get drivel like that. Don't get it twisted, the tories are only a bit better, they've won two elections promising to eliminate the deficit and failed both times. I agree that the ageing population pension time bomb is the elephant in the room that gets ignored and its coupled with adult social care which is going to be hugely expensive.At the same time this will be occurring we could be losing a large proportion of tax paying individuals to automisation and A.I it's a perfect storm.AI will solve as many problems as it creates initially. It doesn't have to, but it will because there's no strategy. For example, we could benefit from a cheaper london underground by scrapping the £60k a year position of train driver but because there's no alternative £60k a year job (that the current employees are capable of and actually needs doing) then we just get political stalemate. Royal Mail has a similar problem where they just recruit a huge temporary workforce and halt recruitment of full time employees to get around the problem, but it's not a real solution. " During the industrial revolution the labour force moved from the field to the factory floor. I can't see where today's labour force is going to move too when their skills become superfluous when the machines take over.What do you think of UBI as a solution. | |||
"Perfect example of the horse shit that comes out of modern politics, moron of the first order John McDonnell is a self described "unapologetic marxist" wants to be a chancellor who makes decisions based on "fairness and equality". Firstly a marxist chancellor is an oxymoron, read the essay and you'll see why. Secondly, we dont need cock wombles talking about catch all terms like fairness. We need to have a long-term strategy for the effect of artificial intelligence on our economy, we need to have a plan for funding pensions when our population starts to decline and eventually we should have a clear policy on whether banks would be bailed out again in future. These are the real issues and instead we get drivel like that. Don't get it twisted, the tories are only a bit better, they've won two elections promising to eliminate the deficit and failed both times. I agree that the ageing population pension time bomb is the elephant in the room that gets ignored and its coupled with adult social care which is going to be hugely expensive.At the same time this will be occurring we could be losing a large proportion of tax paying individuals to automisation and A.I it's a perfect storm.AI will solve as many problems as it creates initially. It doesn't have to, but it will because there's no strategy. For example, we could benefit from a cheaper london underground by scrapping the £60k a year position of train driver but because there's no alternative £60k a year job (that the current employees are capable of and actually needs doing) then we just get political stalemate. Royal Mail has a similar problem where they just recruit a huge temporary workforce and halt recruitment of full time employees to get around the problem, but it's not a real solution. During the industrial revolution the labour force moved from the field to the factory floor. I can't see where today's labour force is going to move too when their skills become superfluous when the machines take over.What do you think of UBI as a solution." If it's done correctly then that could indeed be a partial solution. I think the obvious think to do is steadily reduce the average working week duration which would keep the absolute number of human jobs high. | |||
"The problem with economists is most have never been in the real world where millions of real people make individual decisions, each different, they dont seem to grasp the fact that each person makes a decision based on their own situation, the same reason why accountants cant run a business because they dont understand how each decision can impact it. As has been pointed out we face two huge finacial issues pensions and health care/ care in old age, the trouble is as soon as the nhs is mentioned people start shouting hands off the nhs. It cant carry on as it is, we need a national debate without the politics and until the labour party in particular admit in public what they know, it cant carry on as it is, we cant move forward. The solutions to both problems are there but the longer we kick the can down the road the harder the change will be " I agree with what you said but the problem is deeper than just the background of the economists themselves. The mainstream tools and language they have at their disposal to even explore the problems are obsolete but entrenched. | |||
"The problem with economists is most have never been in the real world where millions of real people make individual decisions, each different, they dont seem to grasp the fact that each person makes a decision based on their own situation, the same reason why accountants cant run a business because they dont understand how each decision can impact it. As has been pointed out we face two huge finacial issues pensions and health care/ care in old age, the trouble is as soon as the nhs is mentioned people start shouting hands off the nhs. It cant carry on as it is, we need a national debate without the politics and until the labour party in particular admit in public what they know, it cant carry on as it is, we cant move forward. The solutions to both problems are there but the longer we kick the can down the road the harder the change will be I agree with what you said but the problem is deeper than just the background of the economists themselves. The mainstream tools and language they have at their disposal to even explore the problems are obsolete but entrenched. " I agree and of course they are protecting their own future at the same time,admit they were/are wrong and their cosy existance is done for,much like many politicians | |||
"The problem with economists is most have never been in the real world where millions of real people make individual decisions, each different, they dont seem to grasp the fact that each person makes a decision based on their own situation, the same reason why accountants cant run a business because they dont understand how each decision can impact it. As has been pointed out we face two huge finacial issues pensions and health care/ care in old age, the trouble is as soon as the nhs is mentioned people start shouting hands off the nhs. It cant carry on as it is, we need a national debate without the politics and until the labour party in particular admit in public what they know, it cant carry on as it is, we cant move forward. The solutions to both problems are there but the longer we kick the can down the road the harder the change will be I agree with what you said but the problem is deeper than just the background of the economists themselves. The mainstream tools and language they have at their disposal to even explore the problems are obsolete but entrenched. I agree and of course they are protecting their own future at the same time,admit they were/are wrong and their cosy existance is done for,much like many politicians" I remember dating a girl at uni who did economics once. I was stunned at how much of the course was maths vrs anything of practical value. That was my first suspicion of the subject. The financial crisis hit a year after i graduate and this paper perfected summed up what I'd been observing for some time. | |||
"The title of the thread is actually, in my opinion, one of the most under-rated essays of all time. Most of you probably haven't heard of it because it expertly explains why everything the mainstream economists have produced in the past 130 years has been utter donkey wank and failed to predict any of the financial bubbles and crisis. Naturally this is something many people have an incentive to surpress. What the essay explains so well is how "100 years ago the field of economics split in two. The mainstream simply gave up the search for any creation of wealth, became purely analytical, and stopped relating economics to the behaviour of people. Economics was a discipline that governed the behaviour of commodities". That's all fine and dandy except most things aren't commodities which explains why the vast majority of economic models have been so bad. When multiple nobel prize winning economists tried to put their theories into practice by starting a hedge fund, they quickly set a new world record for the largest bankruptcy. GDP is also an obsolete measure. It works well enough whilst a country is industrialising, but not in a service based economy. The problem is that GDP measures transactions not benefits. A pound spent on replacing a car after a fatal crash is as valuable in GDP terms as a pound spent on cancer research. Modern economic theory effectively states that if a bank takes money out your left pocket and puts it in your right pocket then you are better off. For those of you who still cling on to the idea that politicians and central banks know what they are doing, please explain to me how there are 15,000 economists employed in the U.S. alone and 99.999% of them didn't see the largest financial distaster of their lives coming? " Very wise words,I agree with you 100% | |||
"Perfect example of the horse shit that comes out of modern politics, moron of the first order John McDonnell is a self described "unapologetic marxist" wants to be a chancellor who makes decisions based on "fairness and equality". Firstly a marxist chancellor is an oxymoron, read the essay and you'll see why. Secondly, we dont need cock wombles talking about catch all terms like fairness. We need to have a long-term strategy for the effect of artificial intelligence on our economy, we need to have a plan for funding pensions when our population starts to decline and eventually we should have a clear policy on whether banks would be bailed out again in future. These are the real issues and instead we get drivel like that. Don't get it twisted, the tories are only a bit better, they've won two elections promising to eliminate the deficit and failed both times. . We've had deficits for hundreds of years in fact I had a quick look. Since 1980 we've had 6 years out of 37 where we didn't 3 under Tories and 3 under labour. Its not debt thats the problem, its what you do with the debt. The guy who borrows ten grand and buys a big tv,a hifi, gadgets.. You don't see much return on your debt. However the guy who borrows ten grand and spends it on educating himself or tools or IT , his debt is working for him. So I dont get to worried about deficits or debt but what they spend it on.. Now Tories have a habit of spending less granted but they also have a habit of spending it on utter shit or stuff that just goes to their mates who then run off to a tax haven with it. I partially agree, our debt to GDP ratio is higher than any peace time period of the last 100 years so it's not like we've been running deficits without consequence. The Ministry of Defence is our 5th largest governmnet department, yet we now spend more on debt interest than we do on our entire defence budget. That's with interest rates at fuck all, what's going to happen if interest rates return to the long term average of 5.5%? " . Well firstly interest rates will never return to long term averages until the debt returns to long term averages, its not just us, its everybody so debt levels don't really matter. Pensions are actually the biggest loser from low interest rates because they're the biggest buyer of bonds, when you say we're spending more money on interest repayments its important to remember alot of that goes to pension holders. The world is overflowing with debt, its six times higher than trade, the maths just dont work unless you have practically zero interest rates the thinking being they could lower debt ratios while propping it up with zirp and nirp,I have no idea if it will work but I'm sure some smart arse in government will have a plan b if it dont, what that is, who knows but it wont be good  | |||
"The problem with economists is most have never been in the real world where millions of real people make individual decisions, each different, they dont seem to grasp the fact that each person makes a decision based on their own situation, the same reason why accountants cant run a business because they dont understand how each decision can impact it. As has been pointed out we face two huge finacial issues pensions and health care/ care in old age, the trouble is as soon as the nhs is mentioned people start shouting hands off the nhs. It cant carry on as it is, we need a national debate without the politics and until the labour party in particular admit in public what they know, it cant carry on as it is, we cant move forward. The solutions to both problems are there but the longer we kick the can down the road the harder the change will be " . Ahhh what to do when you got more people than you need and not enough money to look after them? What do you think the final solution will be?  | |||
 .
Global Hyper inflation is going to come for quite a few years, people without assets the type who live by the pay cheque will be probably no different, but the people due big pensions, the people with large amounts of cash.. They will lose a large amount of their wealth.
The debt ratios will be dropped substantially and the housing bubble will be dropped without crashing the banks.
15 or 20% Inflation for about 10 years should be enough  | |||
"Perfect example of the horse shit that comes out of modern politics, moron of the first order John McDonnell is a self described "unapologetic marxist" wants to be a chancellor who makes decisions based on "fairness and equality". Firstly a marxist chancellor is an oxymoron, read the essay and you'll see why. Secondly, we dont need cock wombles talking about catch all terms like fairness. We need to have a long-term strategy for the effect of artificial intelligence on our economy, we need to have a plan for funding pensions when our population starts to decline and eventually we should have a clear policy on whether banks would be bailed out again in future. These are the real issues and instead we get drivel like that. Don't get it twisted, the tories are only a bit better, they've won two elections promising to eliminate the deficit and failed both times. . We've had deficits for hundreds of years in fact I had a quick look. Since 1980 we've had 6 years out of 37 where we didn't 3 under Tories and 3 under labour. Its not debt thats the problem, its what you do with the debt. The guy who borrows ten grand and buys a big tv,a hifi, gadgets.. You don't see much return on your debt. However the guy who borrows ten grand and spends it on educating himself or tools or IT , his debt is working for him. So I dont get to worried about deficits or debt but what they spend it on.. Now Tories have a habit of spending less granted but they also have a habit of spending it on utter shit or stuff that just goes to their mates who then run off to a tax haven with it. I partially agree, our debt to GDP ratio is higher than any peace time period of the last 100 years so it's not like we've been running deficits without consequence. The Ministry of Defence is our 5th largest governmnet department, yet we now spend more on debt interest than we do on our entire defence budget. That's with interest rates at fuck all, what's going to happen if interest rates return to the long term average of 5.5%? . Well firstly interest rates will never return to long term averages until the debt returns to long term averages, its not just us, its everybody so debt levels don't really matter. Pensions are actually the biggest loser from low interest rates because they're the biggest buyer of bonds, when you say we're spending more money on interest repayments its important to remember alot of that goes to pension holders. The world is overflowing with debt, its six times higher than trade, the maths just dont work unless you have practically zero interest rates the thinking being they could lower debt ratios while propping it up with zirp and nirp,I have no idea if it will work but I'm sure some smart arse in government will have a plan b if it dont, what that is, who knows but it wont be good "Ok so firstly you acknowledged earlier the difference between investing money and just spending it, so saying it's ok to have huge debt repayments because it goes back into pensions is an example of the latter. Second it seems you are acknowledging that the governments of the world would be fucked at a 5.5% interest rate, you just hope to hell it doesn't happen. I don't see how low interest rates are sustainable because it's simply not worth a bank / hedge fund / pension fund lending money / buying bonds for such a poxy return when stock markets average 9% over the long run. It's only like it is because governments keep printing money, so either it ends up as inflation or banks will stop lending at those rates the minute they stop printing it. Notice the FTSE 100 is at a thoroughly undeserved 7,297. Ok course if we could actually have a discussion about the root cause of growth in an economy and make that happen, then we could grow our way out of the crisis but very few people, and even less politician's or economists, really understand where growth comes from. | |||
"No no there not going to gas you .
Global Hyper inflation is going to come for quite a few years, people without assets the type who live by the pay cheque will be probably no different, but the people due big pensions, the people with large amounts of cash.. They will lose a large amount of their wealth.
The debt ratios will be dropped substantially and the housing bubble will be dropped without crashing the banks.
15 or 20% Inflation for about 10 years should be enough "It worked well for Germany | |||
"No no there not going to gas you .
Global Hyper inflation is going to come for quite a few years, people without assets the type who live by the pay cheque will be probably no different, but the people due big pensions, the people with large amounts of cash.. They will lose a large amount of their wealth.
The debt ratios will be dropped substantially and the housing bubble will be dropped without crashing the banks.
15 or 20% Inflation for about 10 years should be enough
It worked well for Germany". I cant see any other choice they have?. They cant out grow the debt because growth requires more debt, its that catch 22 situation. They've pumped about 14 trillion of printed money via QE into the system, in theory that should have created large inflation but instead it seemed to have caused deflation as banks didnt lend and people got scared and payed down debt. I have no clue how they think they will get out of it to be honest. | |||
"No no there not going to gas you .
Global Hyper inflation is going to come for quite a few years, people without assets the type who live by the pay cheque will be probably no different, but the people due big pensions, the people with large amounts of cash.. They will lose a large amount of their wealth.
The debt ratios will be dropped substantially and the housing bubble will be dropped without crashing the banks.
15 or 20% Inflation for about 10 years should be enough
It worked well for Germany.
I cant see any other choice they have?.
They cant out grow the debt because growth requires more debt, its that catch 22 situation.
They've pumped about 14 trillion of printed money via QE into the system, in theory that should have created large inflation but instead it seemed to have caused deflation as banks didnt lend and people got scared and payed down debt. I have no clue how they think they will get out of it to be honest."Growth doesn't require any debt, you've mentioned things like the money supply before - i think thats largely irrelevant. It's a bit like a sunday league footballer debating whether man or zone defence works better when they aren't remotely fit enough to play the game in the first place. Let me put it another way, look around you and how much inefficiency and waste do you see? If we got rid of that then the result would be real economic growth. I think we are about ~70% as efficient as we could be and that's being pessimistic. | |||
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"i think it's the same old donkey wank that you said it was in your opening gambit, only you've put some lippy on it and tarted it up a bit" I think the entire conversation has gone over your head which is why you haven't made a single constructive or objective insightful sentence. | |||
"How about this for a slightly crazy idea. We create a new meaure that governmnet and central banks use to make policy, It's called "Gross Demostic Value". To calculate it is pretty simple, you take every £ of GDP but give it one of four weightings: - If it is desirable to avoid the activity entires multiply by 1 (e.g. money spent on repairing car crashes) - if the activity is desirable to have but minimise then multipy by 2 (e.g. the cost of car insurance) - if the activity is a social good but consumed within 12 months then multiply by 4 (e.g. care for the elderly) -if the activity is an investment that will lower the future cost of goods or provide signigicant social good then multiply by 5 (e.g. cancer research) - divide all of the above by 3 and that's GDV and actual measure of whether people's lives are improving. What do y'all think? " An interesting idea, but god knows how you'd calculate it in reality. I mean how would you allocate the money to each category without dispute? What about things that are composite items? e.g. you car crash/insurance example... what happens when the cost of a crash puts up the cost of the insurance? Or un-intended research. e.g. money spent on military research that invents a new imaging technique that is subsequently found to be able to spot cancer much easier and sooner? -Matt | |||
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 And it wasn't just chance or a coincidence. | |||
"No no there not going to gas you .
Global Hyper inflation is going to come for quite a few years, people without assets the type who live by the pay cheque will be probably no different, but the people due big pensions, the people with large amounts of cash.. They will lose a large amount of their wealth.
The debt ratios will be dropped substantially and the housing bubble will be dropped without crashing the banks.
15 or 20% Inflation for about 10 years should be enough
It worked well for Germany.
I cant see any other choice they have?.
They cant out grow the debt because growth requires more debt, its that catch 22 situation.
They've pumped about 14 trillion of printed money via QE into the system, in theory that should have created large inflation but instead it seemed to have caused deflation as banks didnt lend and people got scared and payed down debt. I have no clue how they think they will get out of it to be honest.
Growth doesn't require any debt, you've mentioned things like the money supply before - i think thats largely irrelevant. It's a bit like a sunday league footballer debating whether man or zone defence works better when they aren't remotely fit enough to play the game in the first place.
Let me put it another way, look around you and how much inefficiency and waste do you see? If we got rid of that then the result would be real economic growth. I think we are about ~70% as efficient as we could be and that's being pessimistic. ". Ah I see, so your talking about growth without new money (debt) by increasing productivity!. Thats an interesting concept and I'll read along and try to follow | |||
"presume what you like luvvie .... can you skip the nest load of waffle about the latest thing you've read on the subject of experimental theological economic bollocks and get on with your usual closing argument about deng xiaoping being the politonomic saviour of the universe " No i'll say what i want on a thread i start. If you've got ideas then start your own thread instead of bringing this one down to pretty insults. | |||
" I saw plenty of poor and middle class people lose their homes and their jobs. I can't say the same for either politicians or CEOs. And it wasn't just chance or a coincidence.". Not only did they make money from the polices that brought about the problem but they made money from the polices that they designed (lets be honest, the banks designed the rescue not politicans) to save us!. Lloyd blankfeld the CEO for Goldman Sachs for instance since the bank crises has personally made billions from it. Yet we still listen to his advice over brexit and international finance. I mean what world am I living in!! Its like taking the advice of Jimmy saville on how to crack down on grooming while we see him groom more and more kids. What we should have done is let the banks go tits and started new ones and jailed anybody and everybody who had a hand in it | |||
"No no there not going to gas you .
Global Hyper inflation is going to come for quite a few years, people without assets the type who live by the pay cheque will be probably no different, but the people due big pensions, the people with large amounts of cash.. They will lose a large amount of their wealth.
The debt ratios will be dropped substantially and the housing bubble will be dropped without crashing the banks.
15 or 20% Inflation for about 10 years should be enough
It worked well for Germany.
I cant see any other choice they have?.
They cant out grow the debt because growth requires more debt, its that catch 22 situation.
They've pumped about 14 trillion of printed money via QE into the system, in theory that should have created large inflation but instead it seemed to have caused deflation as banks didnt lend and people got scared and payed down debt. I have no clue how they think they will get out of it to be honest.
Growth doesn't require any debt, you've mentioned things like the money supply before - i think thats largely irrelevant. It's a bit like a sunday league footballer debating whether man or zone defence works better when they aren't remotely fit enough to play the game in the first place.
Let me put it another way, look around you and how much inefficiency and waste do you see? If we got rid of that then the result would be real economic growth. I think we are about ~70% as efficient as we could be and that's being pessimistic. .
Ah I see, so your talking about growth without new money (debt) by increasing productivity!.
Thats an interesting concept and I'll read along and try to follow"Spolier alert, that's what the whole essay is about | |||
"presume what you like luvvie .... can you skip the nest load of waffle about the latest thing you've read on the subject of experimental theological economic bollocks and get on with your usual closing argument about deng xiaoping being the politonomic saviour of the universe No i'll say what i want on a thread i start. If you've got ideas then start your own thread instead of bringing this one down to pretty insults. " no ... you asked what everyone what they thought and i told you what i thought ... you didn't like it and made a dig .... deal with it | |||
" I saw plenty of poor and middle class people lose their homes and their jobs. I can't say the same for either politicians or CEOs. And it wasn't just chance or a coincidence..
Not only did they make money from the polices that brought about the problem but they made money from the polices that they designed (lets be honest, the banks designed the rescue not politicans) to save us!.
Lloyd blankfeld the CEO for Goldman Sachs for instance since the bank crises has personally made billions from it.
Yet we still listen to his advice over brexit and international finance.
I mean what world am I living in!!
Its like taking the advice of Jimmy saville on how to crack down on grooming while we see him groom more and more kids.
What we should have done is let the banks go tits and started new ones and jailed anybody and everybody who had a hand in it"Agreed.
I wonder why that didn't happen... | |||
"How about this for a slightly crazy idea. We create a new meaure that governmnet and central banks use to make policy, It's called "Gross Demostic Value". To calculate it is pretty simple, you take every £ of GDP but give it one of four weightings: - If it is desirable to avoid the activity entires multiply by 1 (e.g. money spent on repairing car crashes) - if the activity is desirable to have but minimise then multipy by 2 (e.g. the cost of car insurance) - if the activity is a social good but consumed within 12 months then multiply by 4 (e.g. care for the elderly) -if the activity is an investment that will lower the future cost of goods or provide signigicant social good then multiply by 5 (e.g. cancer research) - divide all of the above by 3 and that's GDV and actual measure of whether people's lives are improving. What do y'all think? An interesting idea, but god knows how you'd calculate it in reality. I mean how would you allocate the money to each category without dispute? What about things that are composite items? e.g. you car crash/insurance example... what happens when the cost of a crash puts up the cost of the insurance? Or un-intended research. e.g. money spent on military research that invents a new imaging technique that is subsequently found to be able to spot cancer much easier and sooner? -Matt" Any measure would have some disputes and it's not an exact science but i still think it would be a lot better than what we have today. | |||
"I agree with your assessment of economics as it stands today. The failure of many economists to predict large scale trends (leading to things like housing bubbles and economic crisis) is discouraging and problematic. However, I don't think it's all down to the tools at economists disposal. That's a bit of a cop-out, really. There were economists, lesser-known economists, who were on tv and in print before the latest economic crisis warning of bubbles and bad times to come. There was a whole issue of The Atlantic done on this issue far before the eventual crash. I also remember watching CNBC one morning before school and there was a young-ish economist warning of a housing bubble in 2006, and all of the seasoned pundits poo-pooed him and called him a doomsayer. My point, of course, is that the information, the good information, is out there but people decide who they listen to, what news they read...and when it comes to the economy, everyone would rather believe they're going to keep riding the high. But it isn't impossible to get good information and act accordingly. My aunt moved large sums of money out of the stock market before the crash because the information she valued indicated it wasn't going to keep being good... And I don't think that the answer is to come up with new buzzwords and terminology. We have the figures and information at our disposal to make good choices about the economy. Your suggestion of a GDV (or something similar) just fuses together information that is probably best looked at individually. I think the real problem is that politicians work for certain people and those people tend to have a great deal of power and money. The current state of affairs generally protects them from the harshest turns in the economy - their company may go under or need saving, but they personally got rich off of the policies that brought about the crash. What I'm saying is that I believe the information for a good understanding of the economy is at our disposal, but it is ignored in favor of the information that is going to make the real power players better off. And as long as the average person continues to pay the game according to the rules of the power players, and get their information from sources partial to them, the average player will continue to lose out. I saw plenty of poor and middle class people lose their homes and their jobs. I can't say the same for either politicians or CEOs. And it wasn't just chance or a coincidence."I agree with your sentiments but i think you gloss over some of the deep rooted problems in the information available. It gets back to the question in 1984 about whether people could ever think bad things about big brother if they didn't have the vocabulary to express it! What concerns me it quite how much of our wealth is actually created by debt and variable supply and demand functions rather than solid fundamentals. In other words it's illusory. The average wage in the UK is 5x more than in Poland but we don't have remotely close to 5x more stuff or 5x higher living standard, it's more like 20-30% better here. The rest is made up of currency, house prices and wages. Something about that situation seems unsustainable to me. | |||
" I saw plenty of poor and middle class people lose their homes and their jobs. I can't say the same for either politicians or CEOs. And it wasn't just chance or a coincidence..
Not only did they make money from the polices that brought about the problem but they made money from the polices that they designed (lets be honest, the banks designed the rescue not politicans) to save us!.
Lloyd blankfeld the CEO for Goldman Sachs for instance since the bank crises has personally made billions from it.
Yet we still listen to his advice over brexit and international finance.
I mean what world am I living in!!
Its like taking the advice of Jimmy saville on how to crack down on grooming while we see him groom more and more kids.
What we should have done is let the banks go tits and started new ones and jailed anybody and everybody who had a hand in it"There were banks that did not endulge and would have been fine. That's why i can never get my head around bailing out an investment bank, as a business it's all intangible assets. If it folded then another, better run, bank could pick up the pieces easily. I understand your Jimmy Saville anology but the problem is that many people are just starting to ignore all experts which isn't any better than being gullible and believing charlatans. But economics isn't really that complex for the average joe to make an informed decision on who to listen to, you just have to ask two simple questions: a. Where does true economic growth come from? b. How does what this person is saying contribute towards the answer to a? | |||
"I agree with your assessment of economics as it stands today. The failure of many economists to predict large scale trends (leading to things like housing bubbles and economic crisis) is discouraging and problematic. However, I don't think it's all down to the tools at economists disposal. That's a bit of a cop-out, really. There were economists, lesser-known economists, who were on tv and in print before the latest economic crisis warning of bubbles and bad times to come. There was a whole issue of The Atlantic done on this issue far before the eventual crash. I also remember watching CNBC one morning before school and there was a young-ish economist warning of a housing bubble in 2006, and all of the seasoned pundits poo-pooed him and called him a doomsayer. My point, of course, is that the information, the good information, is out there but people decide who they listen to, what news they read...and when it comes to the economy, everyone would rather believe they're going to keep riding the high. But it isn't impossible to get good information and act accordingly. My aunt moved large sums of money out of the stock market before the crash because the information she valued indicated it wasn't going to keep being good... And I don't think that the answer is to come up with new buzzwords and terminology. We have the figures and information at our disposal to make good choices about the economy. Your suggestion of a GDV (or something similar) just fuses together information that is probably best looked at individually. I think the real problem is that politicians work for certain people and those people tend to have a great deal of power and money. The current state of affairs generally protects them from the harshest turns in the economy - their company may go under or need saving, but they personally got rich off of the policies that brought about the crash. What I'm saying is that I believe the information for a good understanding of the economy is at our disposal, but it is ignored in favor of the information that is going to make the real power players better off. And as long as the average person continues to pay the game according to the rules of the power players, and get their information from sources partial to them, the average player will continue to lose out. I saw plenty of poor and middle class people lose their homes and their jobs. I can't say the same for either politicians or CEOs. And it wasn't just chance or a coincidence.
I agree with your sentiments but i think you gloss over some of the deep rooted problems in the information available. It gets back to the question in 1984 about whether people could ever think bad things about big brother if they didn't have the vocabulary to express it!
What concerns me it quite how much of our wealth is actually created by debt and variable supply and demand functions rather than solid fundamentals. In other words it's illusory. The average wage in the UK is 5x more than in Poland but we don't have remotely close to 5x more stuff or 5x higher living standard, it's more like 20-30% better here. The rest is made up of currency, house prices and wages. Something about that situation seems unsustainable to me. "I don't agree about the vocabulary analogy - theories of language have proven Orwellian linguistic restrictions untrue time and again....and that speaks directly to what I was saying above. We certainly do have the information, and the language, to express what is wrong with our economy. The problem isn't so much terminology as it is emphasis. For example, your second paragraph explains nicely what is wrong with the current set-up (or at least partly what is wrong). You didn't need new terminology or a different phraseology, you just needed to put emphasis on the things that are currently driving the economy, whether good or bad. I think the problem is that "successful" economists today put emphasis on what the wealthy people want to know. And that makes sense - after all, they are the ones with the majority of money invested. However, the majority of people, with the minority of money, are more greatly affected by other aspects of the economy. But no one cares about the people who only have $50,000 invested when there are people with millions and billions to worry about (apologies for using the dollar sign. My computer doesn't have the pound sign and I'm too lazy to look it up and copy and paste  ).
The terminology already exists, but until the majority of people with small sums of money start realizing that they are being supplied with the wrong information and policies are being framed for the bigger players, the economists have little incentive to change their tactics.... | |||
"I agree with your assessment of economics as it stands today. The failure of many economists to predict large scale trends (leading to things like housing bubbles and economic crisis) is discouraging and problematic. However, I don't think it's all down to the tools at economists disposal. That's a bit of a cop-out, really. There were economists, lesser-known economists, who were on tv and in print before the latest economic crisis warning of bubbles and bad times to come. There was a whole issue of The Atlantic done on this issue far before the eventual crash. I also remember watching CNBC one morning before school and there was a young-ish economist warning of a housing bubble in 2006, and all of the seasoned pundits poo-pooed him and called him a doomsayer. My point, of course, is that the information, the good information, is out there but people decide who they listen to, what news they read...and when it comes to the economy, everyone would rather believe they're going to keep riding the high. But it isn't impossible to get good information and act accordingly. My aunt moved large sums of money out of the stock market before the crash because the information she valued indicated it wasn't going to keep being good... And I don't think that the answer is to come up with new buzzwords and terminology. We have the figures and information at our disposal to make good choices about the economy. Your suggestion of a GDV (or something similar) just fuses together information that is probably best looked at individually. I think the real problem is that politicians work for certain people and those people tend to have a great deal of power and money. The current state of affairs generally protects them from the harshest turns in the economy - their company may go under or need saving, but they personally got rich off of the policies that brought about the crash. What I'm saying is that I believe the information for a good understanding of the economy is at our disposal, but it is ignored in favor of the information that is going to make the real power players better off. And as long as the average person continues to pay the game according to the rules of the power players, and get their information from sources partial to them, the average player will continue to lose out. I saw plenty of poor and middle class people lose their homes and their jobs. I can't say the same for either politicians or CEOs. And it wasn't just chance or a coincidence.
I agree with your sentiments but i think you gloss over some of the deep rooted problems in the information available. It gets back to the question in 1984 about whether people could ever think bad things about big brother if they didn't have the vocabulary to express it!
What concerns me it quite how much of our wealth is actually created by debt and variable supply and demand functions rather than solid fundamentals. In other words it's illusory. The average wage in the UK is 5x more than in Poland but we don't have remotely close to 5x more stuff or 5x higher living standard, it's more like 20-30% better here. The rest is made up of currency, house prices and wages. Something about that situation seems unsustainable to me.
I don't agree about the vocabulary analogy - theories of language have proven Orwellian linguistic restrictions untrue time and again....and that speaks directly to what I was saying above. We certainly do have the information, and the language, to express what is wrong with our economy. The problem isn't so much terminology as it is emphasis. For example, your second paragraph explains nicely what is wrong with the current set-up (or at least partly what is wrong). You didn't need new terminology or a different phraseology, you just needed to put emphasis on the things that are currently driving the economy, whether good or bad.
I think the problem is that "successful" economists today put emphasis on what the wealthy people want to know. And that makes sense - after all, they are the ones with the majority of money invested. However, the majority of people, with the minority of money, are more greatly affected by other aspects of the economy. But no one cares about the people who only have $50,000 invested when there are people with millions and billions to worry about (apologies for using the dollar sign. My computer doesn't have the pound sign and I'm too lazy to look it up and copy and paste ).
The terminology already exists, but until the majority of people with small sums of money start realizing that they are being supplied with the wrong information and policies are being framed for the bigger players, the economists have little incentive to change their tactics...."We have the vocabulary to explain what's wrong, but not to explain what it should look like. GDP is just about transactions, there's not a measure that actually quantifies to what extent the average person is better or worse off than last year. This is why people get hysterical saying things like "this is the first generation to be worse off than their parents". It's utter horse crap, it's because amazing things like medical advancements are a tiny proportion of GDP whilst shoes and car accidents are a significant part. | |||
" I saw plenty of poor and middle class people lose their homes and their jobs. I can't say the same for either politicians or CEOs. And it wasn't just chance or a coincidence..
Not only did they make money from the polices that brought about the problem but they made money from the polices that they designed (lets be honest, the banks designed the rescue not politicans) to save us!.
Lloyd blankfeld the CEO for Goldman Sachs for instance since the bank crises has personally made billions from it.
Yet we still listen to his advice over brexit and international finance.
I mean what world am I living in!!
Its like taking the advice of Jimmy saville on how to crack down on grooming while we see him groom more and more kids.
What we should have done is let the banks go tits and started new ones and jailed anybody and everybody who had a hand in it
There were banks that did not endulge and would have been fine. That's why i can never get my head around bailing out an investment bank, as a business it's all intangible assets. If it folded then another, better run, bank could pick up the pieces easily.
I understand your Jimmy Saville anology but the problem is that many people are just starting to ignore all experts which isn't any better than being gullible and believing charlatans. But economics isn't really that complex for the average joe to make an informed decision on who to listen to, you just have to ask two simple questions:
a. Where does true economic growth come from?
b. How does what this person is saying contribute towards the answer to a? ". I'm not saying round up all bankers, I'm not saying everybody who works in banking is a con artist. However there should be some mechanism to punish the ones who broke laws and honestly there was a shit load who did break laws and regulations and lied to through their teeth and worst still, there the actual ones the politicans then went to decide what to do, now this is my argument with you about where actual power lies, it would be overlooking the obvious to imagine the banks and CEOs werent in charge of the bailout, they created the problem for which they profited nicely from and created the bailout for which they profited nicely from and there even now today manipulating the situation that gives us QE and nirp and zirp and tarp.. China doesn't run its own independent banking system for no reason??. Its utterly corrupt. At the end of the film the big short theres a small but very relevant point that most people completely missed, the maths guy and the hedge fund shorter were losing shit loads of money every week and they couldnt figure out why the CDOs they had shorted hadn't collapsed because even they banking insiders hadn't realised how corrupt the banking market was | |||
