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| The Strategy That Has NEVER Worked in forum [Market-Ticker]
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Iou
Posts: 1027
Incept: 2009-03-16
The Twilight Zone
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"When plunder becomes a way of life for a group of men living together in society, they create for themselves, in the course of time, a legal system that authorizes it and a moral code that glorifies it."- Frédéric Bastiat
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Fraudster
Posts: 4176
Incept: 2011-05-10
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Ok. I accept the premise. So how much GDP is going to have to come out? Seems like more than 30% and may be more like 50% or greater?
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"Let China sleep, for when she wakes, she will shake the world." - Napoleon Bonaparte
"Circulation ceases first at the outer edges [Europe and Japan]. It will take a while yet for the decay to reach the heart [America]." - Foundation & Empire by Isaac Asimov
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Genesis
Posts: 130798
Incept: 2007-06-26
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A lot.
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I don't care if it makes sense -- only if it makes money. -- Me
Bank (n): See scam, fraud and theft. Eat a bankster -- they're low-carb.
What part of "shall not be infringed" was unclear?
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Goforbroke
Posts: 5350
Incept: 2007-11-30
Just call me 'Comrade'
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Debt is a tool for enslaving the masses and for transferring money from those who don't have available capital into the hands of those who do.
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We have met the enemy and it is us. -- Pogo
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Mayorquimby
Posts: 13909
Incept: 2008-09-18
The Archaic Past
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Karl- You're kickin' ass with the latest charts. Rock on.
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They who wish to hurt you, work within the law.
- Morrissey
Gold is theft.
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Pika-steph
Posts: 54732
Incept: 2007-09-11
Live Free Or Die; US Army Est. 1775
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This is what always happens to sovereign debt-denominated monetary systems - thus the FFs didn't want the US to have to borrow money into existence.
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Stop the Looting; Start Prosecuting - http://www.FedUpUSA.org/ "The only regulation that really works is failure."--Rick Santelli
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Widgeon
Posts: 13481
Incept: 2007-08-30
Region formerly known as the United States
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eh, but Debt is a Great Tool for phooling the masses into Lifetime Servitude Contracts and buying favors w/ other peoples' money.
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Ssg263
Posts: 392
Incept: 2009-01-07
NY
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Can you explain how you compiled that chart Karl (which data did you look at)?
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Infidel
Posts: 5463
Incept: 2007-08-27
between here and there
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Giving a private corp the sole authority to create a nations money and then pay that same corp. interest to borrow your own money and the outcome is and was predictable.
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"DON'T BELIEVE THEM, DON'T FEAR THEM, DON'T ASK ANYTHING OF THEM." -ALEXANDER SOLZHENITSYN.
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Crzymorse
Posts: 1195
Incept: 2010-06-25
Maryland
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If that's the case we are in for some major deflation, GDP might subtract but the goods and services aren't going to be reduced dollar for dollar. The pyschlogical part of this is bigger than reality.
The financial sector of this economy needs to shrink in a big time way anyway. It's probably 20% of GDP and should be about 5-10%. It would be interesting to see what happened to Iceland financial sector as a % of their economy. Asset pruning at's its finest.
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Fraudster
Posts: 4176
Incept: 2011-05-10
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Crzy - Perhaps, but that does not exclude a 40-50% decline in GDP. Good luck with social stability in that outcome (unemployment, loss of government assistance, and general loss of affluence).
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"Let China sleep, for when she wakes, she will shake the world." - Napoleon Bonaparte
"Circulation ceases first at the outer edges [Europe and Japan]. It will take a while yet for the decay to reach the heart [America]." - Foundation & Empire by Isaac Asimov
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Themortgagedude
Posts: 8853
Incept: 2007-12-17
saint louis
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America needs a swift kick in the ass.
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I'm already visualizing you with duct tape over your mouth.
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Seriousslacker
Posts: 1482
Incept: 2008-09-30
Spinning Clockwise or Counter Clockwise?
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I saw Nicole Foss of the Automatic Earth speak this past Friday night. She had a lot of interesting parallels to Karl. Get your money out of the banks, learn valuable skills(repair things, grow food), get rid of all your debt, stash at least a years worth of cash, only hold precious metals if you can hang onto them for 15-20 years. She believes the financial ponzi scheme will blow up in the next 3 to 5 years. Most interesting thing was that she follows an economist in Australia named Steve Keen - another deflationary depression viewpoint. He is a serious number cruncher - here is his blog http://www.debtdeflation.com/blogs/ |
Jamesbond
Posts: 589
Incept: 2009-01-31
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Quote:Lending - that is, the increase in debt - is not additive to GDP, it is subtractive! Obama never got that memo ... neither did CONgress or Banana Ben ... |
Themortgagedude
Posts: 8853
Incept: 2007-12-17
saint louis
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Steve Keen makes many good points. Many here post his thoughts.
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I'm already visualizing you with duct tape over your mouth.
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Dashingdwl
Posts: 9764
Incept: 2007-06-26
los angeles
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And the advocates are out in force for what? More debt ponzi:
PIMCO
Gross: 2 weeks left for QE2. QE3 should be an informal program stressing extended period language which supports frontend yields.
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Gross is so matter of fact and nonchalant... "yeah, some more debt fueled printing is just the ticket...|
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When you are hard and disciplined, you can be principled. People fear you because they have no leverage against you. It's the truest form of Liberty.
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Grf
Posts: 1337
Incept: 2008-12-08
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Correlation isn't causation.
I think this graph is more indicative of our preferences on how we use debt are changing.
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"Every time we on TF talk about God and gays, God frees a banker and gives him a bonus." --me
"Your farts are interstate commerce and if they want to stick a muffler up your ass they will do it." --Boughtthefarm
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Amack
Posts: 303
Incept: 2008-11-26
food exporting nation
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you may approach the altar, slowly... http://www.frbatlanta.org/pubs/wp/11_10.....New Keynesian Dynamics in a Low Interest Rate Environment R. Anton Braun and Lena Mareen Körber Working Paper 2011-10 May 2011 Recent research has found that the dynamic properties of the New Keynesian model can be very different when the nominal interest rate is zero. Improvements in technology and reductions in the labor tax rate lower economic activity, and the size of the government purchase output multiplier can be well above one. This paper provides evidence that the focus on specifications of the New Keynesian model that produce unorthodox results in a liquidity trap may be misplaced. We show that a prototypical New Keynesian model fit to Japanese data exhibits orthodox dynamics during Japan's episode with zero interest rates. We then demonstrate that this specification is more consistent with outcomes in Japan than alternative specifications that have unorthodox properties. |
Etz
Posts: 13891
Incept: 2007-06-26
LA
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Quote:The Strategy That Has NEVER Worked That depends on how you look at it. It has worked beautifully for the criminal banking cartel and their cockroaches err... executives.
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Legal chicanery and beneficent darkness are the banker's stoutest allies - F.Pecora.
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Verredesoleil
Posts: 66
Incept: 2009-12-06
San Francisco
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So have we had monetary flat spin since 1981 and Good Ole Ronnie? I'm a newbie but CBW's(Chief Bottle Washer)little dittie about this topic has always intrigued me. Have we learned to defy gravity? If so, I want some -- especially that cool levitating "car" in Star Wars. Yeah, this one! Where can I get my car loan? Money for nothing and chicks for free, yeah that's the way you do it ...
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Mannfm11
Posts: 3556
Incept: 2009-02-28
DFW, Tx
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I'm going to question this one myself. If debt has gone up and GDP has gone up, how can the correlation be negative? That is either impossible or I am missing what chart is supposed to convey.
I do know this. If you put more debt into the system, it stimulates demand. If it is lets say 10% of GDP one year, then fail to put it in the next year, you have a recession. This is the chicken and egg effect in a sense. Did putting the debt in there in the first place cause the recession or taking it out?
There are some thoughts that occur to me. One of them is the economy can't exist on a fixed money supply and there be borrowing and lending and other activity, because of the friction between repayment, payment of interest and what is available. It is important to be able to assemble and accumulate capital, so this has to be a consideration. Problem is money or capital are represented as being someone else's debt. This would be true to some extent if we had a pure gold standard. So, either the government creates more money on one hand or it has to be borrowed into existence and supported by increasingly phony balance sheets on the other hand. It is hard to describe, but even in a fiat system, everything between the base and what appears in accounts is exponential fantasy. It is compound figures on one side and compound figures on the other side and neither actually existed. This is where we are, our bank accounts and debts being pure exponential fiction. Even with the Bernanke nonsense, there are about $4 in bank debt for every dollar that really exists. And the dollars that exist are based themselves on exponential government debt, the repayment of which would destroy the monetary base.
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The only function of economic forecasting is to make astrology look respectable.---John Kenneth Galbraith
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Mannfm11
Posts: 3556
Incept: 2009-02-28
DFW, Tx
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Amack, that appears to be written by someone with enough power that he needs to take a swim and catch a large rock he can't drop. Meaning drown. There is something inherently wrong with high interest rates and something more wrong with zeros. The people should withdraw their cash, every ****ing dime of it.
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The only function of economic forecasting is to make astrology look respectable.---John Kenneth Galbraith
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Bagbalm
Posts: 4263
Incept: 2009-03-19
Just North of Detroit
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Mannfm - It is like an attempt to make a perpetual motion machine. There is always less returned to the system than is generated. We use borrowed money to create depreciating assets. The bank draws off profit. Government draws off funds that go to no benefit at all. No matter how efficient and how much momentum the massive machine slowly grinds to a halt if nothing productive is generated. Farming and mining and manufacturing have not disappeared, but they are no longer sufficient to keep the return above unity. What is surprising is not that it fails but how long it can keep moving on sheer momentum.
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Rbnh
Posts: 44
Incept: 2010-10-07
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THANK YOU Karl!
Checking a 1984 "Basic Economics" book, here is what it says on page 4 (no, not p 200!):
"National wealth ... does NOT include ... debts owned internally, since wealth cannot be increased by printing more notes or increasing loans to one another."
Keep up the good work.
It's BASIC, school economics!
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