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#41 hblask

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Posted 04 January 2012 - 06:31 PM

View Poststrategy, on Wednesday, January 4th, 2012, 12:52 PM, said:

this is SO META for this thread
LOLTo answer the question, I think it is clear that inflation hurts the poor and unsophisticated the most; many people seem unbothered by that, which I find to be a bit of a mystery. Deflation seems to be more harmful than inflation, though, so the optimal policy seems to be minimal inflation without suffering through periods of deflation. Obviously getting it exactly right would be the best policy, as would happen in a competitive commodity-based currency market, but the people who want to spend unchecked will never allow that, so 0-2% inflation as a goal is probably the best we'll get, as that only harms the poor a little.
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#42 Balloon guy

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Posted 04 January 2012 - 07:00 PM

View Posthblask, on Wednesday, January 4th, 2012, 6:31 PM, said:

LOLTo answer the question, I think it is clear that inflation hurts the poor and unsophisticated the most; many people seem unbothered by that, which I find to be a bit of a mystery. Deflation seems to be more harmful than inflation, though, so the optimal policy seems to be minimal inflation without suffering through periods of deflation. Obviously getting it exactly right would be the best policy, as would happen in a competitive commodity-based currency market, but the people who want to spend unchecked will never allow that, so 0-2% inflation as a goal is probably the best we'll get, as that only harms the poor a little.
And which school of economic thought will best accomplish this?Keynesian or Austrian?
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#43 hblask

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Posted 04 January 2012 - 07:14 PM

View PostBalloon guy, on Wednesday, January 4th, 2012, 9:00 PM, said:

And which school of economic thought will best accomplish this?Keynesian or Austrian?
I'm not sure Austrian school supports central banking in general, so probably Keynesian by default. What is the sound of one hand clapping?
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#44 strategy

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Posted 04 January 2012 - 07:25 PM

I apologize if you've already addressed this, but how does a commodity-based currency deal with population growth?I understand why you want to do it. wanting to take as much as possible away from the monkeys in washington is a reasonable desire.
QUOTE (ShakeZuma @ Wednesday, November 2nd, 2011, 4:25 AM) <{POST_SNAPBACK}>
seriously though, with that grammar it's really like, I mean it doesn't bother me as much that she gets beat, you know?


#45 hblask

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Posted 04 January 2012 - 07:51 PM

View Poststrategy, on Wednesday, January 4th, 2012, 9:25 PM, said:

I apologize if you've already addressed this, but how does a commodity-based currency deal with population growth?I understand why you want to do it. wanting to take as much as possible away from the monkeys in washington is a reasonable desire.
Competing commodity-based currencies promote stable prices because they have to compete to give the best value for both ends of a transaction. Both sides need to feel they are getting the best deal possible. If they inflate their currency, the person receiving the money goes somewhere else. If they deflate their currency, the person receiving the product goes somewhere else. They have to balance the two all the time better than their competitors.They don't deal with population growth directly, but instead "production growth" (which is obviously directly affected by population growth). The idea is if the economy produced 100 widgets one year and they printed 100 VisaBucks, and the next year the economy grew so that it produced 110 widgets, then they would print 110 VisaBucks (or, more accurately, have 110 in the economy). That way, a widget is always exactly one VisaBuck.If they instead print 200, the seller knows it is only worth half as much, and will not accept 100 anymore. They will either have to get 200 or go to AmEx and use their currency, which might still be worth $1.You wouldn't even need to get rid of or audit the Federal Reserve, because if the Fed screwed up, people would just stop using their money. Look at BitCoin... I'm not even sure it's legal and it's already attracting a lot of attention. It is basically a competing commodity-based currency. (If someone can explain the theory of how they create money and why that is optimal, that would be great....) The commodity, though, is sort of floating -- what the users are willing to trade for it. It seems like they are trading price stability for 'volume of money supply' stability... I haven't thought about it hard enough to think through the repercussions of that.
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#46 mk

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Posted 05 January 2012 - 07:21 AM

View Posthblask, on Wednesday, January 4th, 2012, 8:31 PM, said:

LOLTo answer the question, I think it is clear that inflation hurts the poor and unsophisticated the most; many people seem unbothered by that, which I find to be a bit of a mystery. Deflation seems to be more harmful than inflation, though, so the optimal policy seems to be minimal inflation without suffering through periods of deflation. Obviously getting it exactly right would be the best policy, as would happen in a competitive commodity-based currency market, but the people who want to spend unchecked will never allow that, so 0-2% inflation as a goal is probably the best we'll get, as that only harms the poor a little.
Very glad to have not gotten a contemptuous, dismissive return here. In response:I certainly would be bothered by your premise if I thought it were true; I would argue that inflation is not merely a one-way street, harming the poor with the rising cost of goods and services. Inflation also, in effect, transfers wealth from lenders (the powerful) to borrowers (everyone else) because it lowers the real cost of making a fixed stream of payments, e.g. the real cost of repaying a 30y fixed goes down because its costs are locked in. Small levels of controlled inflation also benefit output and therefore employment, which helps everyone.Deflation results in major cutbacks in output and hiring, which is kind of a big problem if you have an expanding population. It also results in a major rise in collateral requirements, which attenuates borrowing power and thus the velocity of money within the economy even further and these effects become additive and extremely difficult to combat. A money supply fixed to the physical supply of a commodity compounds these effects dramatically, and many economic scholars have argued that the Great Depression was indeed lengthened unnecessarily by the gold standard.The Fed doesn't choose to not get it "exactly right" and shoot for 0% inflation because they want unchecked spending; this is tinfoil hattery. They shoot for 1-2% because 0% inflation means short term interest rates will very likely be 0%, and you have no wiggle room while sitting at a level (0) where a very small decline in prices/wages, which will often happen simply due to noise, can cause a deflationary spiral. It's essentially a buffer against noise in the economy.

#47 DJ Vu

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Posted 05 January 2012 - 02:35 PM

#5strategy says,I need to know that I'm not taking crazy pills

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He would move the U.S. to a so-called territorial system of taxation, in which the government taxes only domestically generated corporate income. Republican leaders in Congress have shown interest in this concept. House Ways and Means Chairman Dave Camp, a Michigan Republican, introduced a proposal in October that would shield 95 percent of profits earned offshore from taxation in the U.S.
aren't these the people worried about sending jobs+capital overseas, or is that the other side?

#48 hblask

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Posted 05 January 2012 - 06:28 PM

View Postmk, on Thursday, January 5th, 2012, 9:21 AM, said:

Very glad to have not gotten a contemptuous, dismissive return here. In response:I certainly would be bothered by your premise if I thought it were true; I would argue that inflation is not merely a one-way street, harming the poor with the rising cost of goods and services. Inflation also, in effect, transfers wealth from lenders (the powerful) to borrowers (everyone else) because it lowers the real cost of making a fixed stream of payments, e.g. the real cost of repaying a 30y fixed goes down because its costs are locked in. Small levels of controlled inflation also benefit output and therefore employment, which helps everyone.Deflation results in major cutbacks in output and hiring, which is kind of a big problem if you have an expanding population. It also results in a major rise in collateral requirements, which attenuates borrowing power and thus the velocity of money within the economy even further and these effects become additive and extremely difficult to combat. A money supply fixed to the physical supply of a commodity compounds these effects dramatically, and many economic scholars have argued that the Great Depression was indeed lengthened unnecessarily by the gold standard.The Fed doesn't choose to not get it "exactly right" and shoot for 0% inflation because they want unchecked spending; this is tinfoil hattery. They shoot for 1-2% because 0% inflation means short term interest rates will very likely be 0%, and you have no wiggle room while sitting at a level (0) where a very small decline in prices/wages, which will often happen simply due to noise, can cause a deflationary spiral. It's essentially a buffer against noise in the economy.
Ok, I figured this might be a reply to me, so I unblocked it and appreciate the serious response.
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#49 DJ Vu

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Posted 10 January 2012 - 10:30 AM

#6strategy says,lawrence summers had a piece in the FT yesterday (or the day before, depending on when I send this email).

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The nature of the transformation is highlighted by the 50 fold change in the relative price of a television set of a constant quality and a day in a hospital over the last generation. While it is often observed that wages for median workers have stagnated, this obscures an important aspect of what is occurring. Measured via items such as appliances or clothing or telephone services, where productivity growth has been rapid, wages have actually risen rapidly over the last generation. The problem is that they have stagnated or fallen measured relative to the price of food, housing, healthcare, energy and education. But at a deeper level, citizens of the industrial world who believe that they live in progressive societies are right to wonder why increasingly affluent societies need to roll back levels of social protection. Paradoxically, the answer lies in the very success of capitalism which has made the opportunity-cost of an individual teaching or nursing or administering that much more expensive
you can probably access the article for free through FT with this search. he's arguing that people (wrongly) look to make big changes to our system when the economy's doing poorly--today's pain distorts our expectations for the future. if you are in the mood to get a little dumber, check reddit's economy, economics, and business sections. the average person believes this slump is never going to end, or that it is actively getting worse. there's some rough-looking math in this paper, but it's relatively easy to understand what he's saying.

Quote

For instance, making a mistake between a bet and a payoff (binary) that depends on the full distribution is extremely common among sophisticated people, which led high ranking social scientists to start the so called "prediction markets" grounded in the idea that binary bets on markets going higher or lower are hedges (they are not, as was asserted in Taleb (1997) yet the incidence of such confusion has increased since).Trivial perhaps, but serious. Very serious. Otherwise we would not have had the crisis that started in 2008 in spite of thousands of PhDs in quantitative fields missing the point and similar ones staring at them. Indeed the probabilistic mistakes that led the the collapse of the banking system were trivial and remain uncured: banks focusing on "probability" of profit and loss, causing them to engage in negative Black Swan exposures, a high probability of "mildly profitable", low probability of disaster, and a negative overall expected return while being convinced that “being profitable most of the time” is their mission.
reading this almost makes me want to go back to school.

#50 DJ Vu

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Posted 12 January 2012 - 09:40 AM

#7strategy says,something really neat from krugmanhe fit a linear equation to the fed's decisions from 1988-2008 he doesn't think it'll be very accurate going forward :club: question: does the smaller end of the tie need to go through the inner tie-loop thing, or do I just need to buy longer ties?

#51 mk

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Posted 12 January 2012 - 10:40 AM

View PostDJ Vu, on Thursday, January 12th, 2012, 11:40 AM, said:

question: does the smaller end of the tie need to go through the inner tie-loop thing, or do I just need to buy longer ties?
yesmaybe

#52 strategy

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Posted 12 January 2012 - 11:27 AM

mine just touches my belt buckle and comfortably fits through the loop. so maybe I got it just right.
QUOTE (ShakeZuma @ Wednesday, November 2nd, 2011, 4:25 AM) <{POST_SNAPBACK}>
seriously though, with that grammar it's really like, I mean it doesn't bother me as much that she gets beat, you know?


#53 iZuma

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Posted 12 January 2012 - 12:18 PM

is strategy like 6'10" or something?

#54 strategy

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Posted 12 January 2012 - 04:16 PM

View PostiZuma, on Thursday, January 12th, 2012, 2:18 PM, said:

is strategy like 6'10" or something?
5'10" and FAT
QUOTE (ShakeZuma @ Wednesday, November 2nd, 2011, 4:25 AM) <{POST_SNAPBACK}>
seriously though, with that grammar it's really like, I mean it doesn't bother me as much that she gets beat, you know?


#55 Balloon guy

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Posted 12 January 2012 - 05:01 PM

View Poststrategy, on Thursday, January 12th, 2012, 4:16 PM, said:

5'10" and FAT
I used to be 5'10"In the 5th grade I think
I use my cigar smoke as idiot repellent

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#56 ahosang

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Posted 12 January 2012 - 11:29 PM

View Poststrategy, on Thursday, January 12th, 2012, 7:27 PM, said:

mine just touches my belt buckle and comfortably fits through the loop. so maybe I got it just right.
That's ma boy!! And if you have a really good wrap style, then when finished work, you can simply loosen the tie, and remove it without having to unravel the whole thing, yes?? That way you don't have to keep tying it anew each morning.
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#57 strategy

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Posted 12 January 2012 - 11:46 PM

the knot gradually gets worse as you tighten/loosen it over and over, and it wrinkles the crap out of the tie when you finally undo it. I finally broke down and had my dad teach me a month ago, but never thought to ask if it was actually necessary to have it looped through. I think I'll eventually just nail it with the perfect length every time.actually, I'm probably pretty close to quitting this job, so maybe no tie needed going forward? best-case.
QUOTE (ShakeZuma @ Wednesday, November 2nd, 2011, 4:25 AM) <{POST_SNAPBACK}>
seriously though, with that grammar it's really like, I mean it doesn't bother me as much that she gets beat, you know?


#58 Balloon guy

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Posted 13 January 2012 - 08:18 AM

View Poststrategy, on Thursday, January 12th, 2012, 11:46 PM, said:

the knot gradually gets worse as you tighten/loosen it over and over, and it wrinkles the crap out of the tie when you finally undo it. I finally broke down and had my dad teach me a month ago, but never thought to ask if it was actually necessary to have it looped through. I think I'll eventually just nail it with the perfect length every time.actually, I'm probably pretty close to quitting this job, so maybe no tie needed going forward? best-case.
Rush Limbaugh tiesare extra long for us 'husky fellas'Being 6'5" and 270 I can't wear regular ties.My wife brought me a really nice silk tie from Thailand....it couldn't reach my belly button.
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#59 mk

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Posted 13 January 2012 - 08:58 AM

View PostBalloon guy, on Friday, January 13th, 2012, 10:18 AM, said:

My wife brought me a really nice silk tie from Thailand....it couldn't reach my belly button.
sounds like you didn't get the intended message there b

#60 DJ Vu

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Posted 13 January 2012 - 02:10 PM

#8strategy says,hungary actually sounds pretty screwedthis was not written by krugman and is thus BG-safe.




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