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Post by magellan on Dec 19, 2015 0:14:45 GMT
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Post by duwayne on Dec 19, 2015 1:36:43 GMT
Another possible take on the rate increase, and our populist tendency to criticize the Fed- QE ended about a year ago. For about one year, the Fed has not meddled in the economy, they have been watching and waiting like everyone else. Many people have been saying that i rates have been set unnaturally low by the Fed. But in saying that, aren't those people acknowledging the need for a central bank like the Fed? How can rates be "unnaturally" low. If the money supply has been fixed for a year, won't supply and demand for money govern the current interest rate? Isn't a Fed set interest rate a form of government intervention, and a brake on the economy, determined by whoever is in charge? I think I read Ben Bernanke say something to this effect a few months ago. And I had been thinking sort of the same thing. And so, who do we pick as that person smart enough to dictate the correct interest rates? Someone, or almost everyone, will be dissatisfied. Would we prefer that there was no Fed discount window? A truly fixed money supply governed only by how fast we can mine gold and silver? Walnut, maybe it's semantics, but I wonder about what you say here. 1) You said "QE ended about a year ago." The Fed via QE bought large amounts of long term government debt and other securities with money printed out of thin air. They haven't sold them. As the securities mature, they buy more to replace them. For QE to end these securities must be sold or mature without replacement. QE is a massive unconventional intervention which is still in place. 2)You said "For about 1 year the Fed has not meddled in the economy." The Fed constantly meddles by buying short term Treasuries to maintain short term interest rates at their target levels. This is in addition to QE. They will meddle slightly less in order to allow interest rates to float up by 0.25%. 3)You said "If the money supply has been fixed for a year...". The money supply hasn't been fixed for a year. It changes constantly and because much of the money supply is due to banks' lending policies (fractional reserves), it is not directly controlled by the Fed. And so on. The Fed has not been on vacation. It's actions are extraordinary and unprecedented. Just like the climate scientists, the Fed uses models which have minimal predictive power to justify their decisions which happen to enrich their banker friends and future employers at the expense of retirees and savers. And they are un-elected private individuals who act without restraint.
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Post by walnut on Dec 19, 2015 3:37:14 GMT
But, those bonds are not doing any harm sitting in a gov't account, and essentially factor out bonds which were sold at an earlier time. And eventually will expire. Correct? It simply amounts to an increase in the money supply, and bond buying was the vehicle used to accomplish that. You could say that those positions will need to be reversed, but why would they? The dollar has been very strong, and if the dollar were pushed any higher the stock market would suffer. I know that the Fed conducts open market activities on an ongoing basis, and wondered if anyone would catch that point when I wrote that. I was making a less specific point, that the absence of Fed created interest rates seems less artificial than arbitrary Fed interest rates. It is just a point to think about, I am not even sure I am right in my logic. The same people who argue that the Fed should be audited and abolished, are demanding that the Fed charge interest rates. It kinda reminds me when the people who talk about free market capitalism, get angry when the Shell station "gouges" them charging 15 cents more than the customer thinks they have a right to charge him. People are capitalists when it is convenient, or cheap for them, and they are populist libertarians until something frightens them away from it. I think if we go back on the gold standard, why not go all the way and let supply and demand for money determine interest rates. Another possible take on the rate increase, and our populist tendency to criticize the Fed- QE ended about a year ago. For about one year, the Fed has not meddled in the economy, they have been watching and waiting like everyone else. Many people have been saying that i rates have been set unnaturally low by the Fed. But in saying that, aren't those people acknowledging the need for a central bank like the Fed? How can rates be "unnaturally" low. If the money supply has been fixed for a year, won't supply and demand for money govern the current interest rate? Isn't a Fed set interest rate a form of government intervention, and a brake on the economy, determined by whoever is in charge? I think I read Ben Bernanke say something to this effect a few months ago. And I had been thinking sort of the same thing. And so, who do we pick as that person smart enough to dictate the correct interest rates? Someone, or almost everyone, will be dissatisfied. Would we prefer that there was no Fed discount window? A truly fixed money supply governed only by how fast we can mine gold and silver? Walnut, maybe it's semantics, but I wonder about what you say here. 1) You said "QE ended about a year ago." The Fed via QE bought large amounts of long term government debt and other securities with money printed out of thin air. They haven't sold them. As the securities mature, they buy more to replace them. For QE to end these securities must be sold or mature without replacement. QE is a massive unconventional intervention which is still in place. 2)You said "For about 1 year the Fed has not meddled in the economy." The Fed constantly meddles by buying short term Treasuries to maintain short term interest rates at their target levels. This is in addition to QE. They will meddle slightly less in order to allow interest rates to float up by 0.25%. 3)You said "If the money supply has been fixed for a year...". The money supply hasn't been fixed for a year. It changes constantly and because much of the money supply is due to banks' lending policies (fractional reserves), it is not directly controlled by the Fed. And so on. The Fed has not been on vacation. It's actions are extraordinary and unprecedented. Just like the climate scientists, the Fed uses models which have minimal predictive power to justify their decisions which happen to enrich their banker friends and future employers at the expense of retirees and savers. And they are un-elected private individuals who act without restraint.
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Post by sigurdur on Dec 19, 2015 18:25:54 GMT
The late Barry Goldwater would agree with this:
John Locke in his Letter On Toleration, 1689:
… it does not follow, that because it is a sin it ought therefore to be punished by the magistrate. For it does not belong unto the magistrate to make use of his sword in punishing every thing, indifferently, that he takes to be a sin against God. Covetousness, uncharitableness, idleness, and many other things are sins, by the consent of all men, which yet no man ever said were to be punished by the magistrate. The reason is, because they are not prejudicial to other men’s rights, nor do they break the public peace of societies."
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Post by sigurdur on Dec 19, 2015 18:26:10 GMT
The present nut job Ted Cruz would disagree.
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Post by missouriboy on Dec 23, 2015 16:15:24 GMT
These Are the Emails Snowden Sent to First Introduce His Epic NSA Leaks
http://www.wired.com/2014/10/snowdens-first-emails-to-poitras/
We are building the greatest weapon for oppression in the history of man, yet its directors exempt themselves from accountability. NSA director Keith Alexander lied to congress, which I can prove.
I appreciate your concern for my safety, but I already know how this will end for me and I accept the risk.
From now, know that every border you cross, every purchase you make, every call you dial, every cell phone tower you pass, friend you keep, article you write, site you visit, subject line you type, and packet you route, is in the hands of a system whose reach is unlimited but whose safeguards are not. Your victimization by the NSA system means that you are well aware of the threat that unrestricted, secret abilities pose for democracies. This is a story that few but you can tell.
Where to view Citizenfour. www.bustle.com/articles/65810-where-to-watch-citizenfour-online-because-we-all-need-our-daily-dose-of-the-truth
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Post by sigurdur on Dec 23, 2015 16:20:42 GMT
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Post by sigurdur on Dec 23, 2015 17:01:28 GMT
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Post by magellan on Dec 24, 2015 3:38:18 GMT
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Post by sigurdur on Dec 24, 2015 4:32:20 GMT
Magellan: With all due respect, you have bought the new thinking. Word of advice, in regards to President Eisenhower. Look at the BUDGET numbers while he was President. President Eisenhower did NOT advocate a large standing Army. He did advocate nuclear weapons as the deterrent. He got the US out of Korea after Truman got us in. Even the Suez Canal, only stayed 3 weeks, and left. Eisenhower, if you read his memo's and visit his library, adhered to the advice of our founders. He did NOT think the US should be involved in foreign entanglements.
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Post by glennkoks on Dec 25, 2015 20:06:48 GMT
Ike was aware of the dangers of the military industrial complex. Now with Super PAC's the influence peddlers have more power than ever. Just how much has the American taxpayer paid for the so called "wars" in Afghanistan and Iraq? And more importantly what have we got for it? Is the region more stable or less?
Are the Iraqi people any better off now that we removed Saddam Hussein from power?
It is important to know your enemy. A large standing army will not help us in the modern world where are biggest threat comes from small terror cells. Our biggest national foreign opponent is clearly China. But they are not going to meet us on a battlefield. They will overthrow us economically and we are doing everything in our power to help them.
“There is no instance of a nation benefitting from prolonged warfare.” ― Sun Tzu, The Art of War
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Post by acidohm on Dec 25, 2015 20:51:58 GMT
I sometimes wonder, if we spent the resources we do on armies on bridges, schools and water supply instead.....would we be any worse off???
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Post by sigurdur on Dec 26, 2015 2:18:39 GMT
I sometimes wonder, if we spent the resources we do on armies on bridges, schools and water supply instead.....would we be any worse off??? We would be infinitely better off. The beauty, which our founders understood, of having the 2nd amendment was to TOTALLY avoid a large standing army. They knew, that if the call to arms was required, that the citizens would come prepared to defend the borders against an invasion. Even Admiral Yomoto understood this. Behind every tree, blade of grass etc someone would be shooting at you. We are destroying the US from within, based on fear of others. NOT remembering that there are oceans between the US and the rest of the world. Almost laughable how over taken the US has become........except it isn't laughable, it is down right sad.
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Post by glennkoks on Dec 26, 2015 4:51:28 GMT
I sometimes wonder, if we spent the resources we do on armies on bridges, schools and water supply instead.....would we be any worse off??? Economist's, historians and politicians have debated the pro's and con's of the New Deal forever. Personally I think some of the programs were great others not so much. However some of the WPA's projects have paid off dividends for well over eighty years. Infrastructure projects pay off for years and years in the form of increased efficiencies etc. Wars do just the opposite.
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Post by nautonnier on Dec 26, 2015 10:15:52 GMT
I sometimes wonder, if we spent the resources we do on armies on bridges, schools and water supply instead.....would we be any worse off??? Economist's, historians and politicians have debated the pro's and con's of the New Deal forever. Personally I think some of the programs were great others not so much. However some of the WPA's projects have paid off dividends for well over eighty years. Infrastructure projects pay off for years and years in the form of increased efficiencies etc. Wars do just the opposite. That all depends why you fight the war, and how you fight the war. The recent ' let's go into a functioning country and remove its government as we don't like how it is being run' - as with Libya, Syria and to some extent Egypt. Are not justifiable. Responding to a country that has attacked your interests or preempting such an attack can be forgivable as in Afghanistan and Iraq. However, the plan must include selection and maintenance of the Aim (which is actually the First Principle of War). A political system in which the 'commander in chief' stands down every so often and is replaced with someone who has diametrically opposite views of 'The Aim' will fail every time. There are other reasons for Iraq going bad but that is the main one. Libya went bad because there was no reason to go in there apart from a poorly veiled and failed attempt to assist in the building of a Caliphate based around the Muslim Brotherhood. It failed because Egypt is more secular than the clerics assumed so the MB were becoming extreme and killing off other religions such as Coptic Christians to attempt to move to 100% Sharia without support and the Egyptian army took over instead. Libyans were being fed arms to set up a similar Sharia state but for some reason the recipients of the Administration's largesse bit the hand that fed them in Benghazi. Libya that always was a nation made up of a loose coalition of warring tribes then reverted to type. Libya needed Qadaffi as Yugoslavia needed Tito and Iraq needed Sadaam. This entire Great Game redux has been restarted by the US, possibly because of the huge amount of oil found in the eastern Mediterranean Note the usage of ISIL - Islamic State In Levant - by the Administration tends to give this away. The support to the Iranian Shia does not really square with the support to ISIL Sunni. It looks like someone was trying to play ends against the middle None of this is based on Military Expenditure, which has dropped to extremely low levels such that the USA has lower level of armed forces than before the second world war. It could be argued that much of the problem is the reduced military expenditure together with an administration trying to get involved in a complex geopolitical game that the approach of the university professor common room is not only totally inept but creating huge problems leading to the deaths of many in the Middle East.
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