My Tea Party Starts at 3:00pm

[Bob Larter]

Mortgage bubble: government was in-phase with the money supply.

Indeed.

 

[Bob Larter]

That may be only true for those of us who know a lot about control
loops. I doubt it would help a football player or a lawyer very much.

Even the way that we think about "noise" is different than folk in
other fields.

The professors I learned economics from used very different terms for
the same concepts as the engineering ones. They didn't even use the
term "partial derivative" for things that were clearly exactly that.

<nods> A former GF of mine was studying psychology, & they use all sorts
of weirdly different statistical terminology & techniques for no
apparent reason. Confusing as hell.

 

[Bob Larter]

On Thu, 30 Apr 2009 06:43:57 -0700 (PDT), MooseFET



MooseFET wrote:
[....]
Thinks like a sudden step in the income tax at $3 Million would be the
sort of thing needed. When a lot of people suddenly go above the $3
Million mark, it would cause the government to run a surplus and
reduce the money supply.
That would just cause people to earn less than $3M.
No if you look back to the Eisenhower era, you will see that adjusted
for inflation there was such a tax and people did make more than it
and they did pay the high tax.
We could also have a small tax on all stock
transactions. The bubbles are also marked by a large increase in the
volume of transactions. When things go in the other direction,
programs like unemployment insurance would add to the money supply.
The economy is very non-linear. The gain drops a great deal when the
economy slows down and increases during a boom. This is why there is
the tendency for it to stick at the bottom of the swing. whatever you
do needs to change the gain in the other direction.
It's not all that complicated. The government made a bunch of
changes to get loans for non-creditworthy people. Don't do
that.
This is not what caused even the bubble that you claim it did cause.
It most certainly isn't what caused the Clinton era bubble. Note that
the Clinton era one was less of a problem than the last one.
Don't be in the loan business, don't meddle with the incentives,
don't lend money to banks for nothing and let them leverage it
30:1. Don't.
Failure to regulate is what allows the instabilities in the free
market to be at there worst. It ensures that we have crash after
crash and that the crashes will be of the worst sort.
Obama's said he doesn't want an economy based on excess borrowing,
yet his every move is to facilitate returning to it as quickly as
possible, and make whole those who should be paying the price.
Right now we have a decreasing money supply. Injecting money right
now is the right thing to do. When the economy is doing well is when
to sharply reduce spending etc. It is basic economics.
That is one economic "school of thought".

The others involve throwing cats over your shoulder after running
around the stump three times. Think of the economy as a complex servo
system with the money supply as one of the nodes in it. If you think
about it that way, it should be obvious that the government should
work against changes in the money supply, which ever direction they go
in.

So you think politicians are in the business of stabilizing the
economy?

Of course. What do you think happens to an opamp circuit if you break
the feedback loop?

Do you think they should be making win/lose decisions?

What does that mean?

 

[James Arthur]

krw wrote:

Of course. What do you think happens to an opamp circuit if you break
the feedback loop?

But politicians did the opposite--they broke and overrode the
traditional, natural feedback loops:

o They pressured bankers to make loans they wouldn't normally make.

o They offered inducements to gain bankers' compliance.

o They isolated the loan-makers from the risk of loss:
- by buying the loans
- by guaranteeing the securities

o They protected the GSEs from reform

o They made money from the Treasury available at below-market
rates.

for just a few examples.

Cheers,
James Arthur

 

[krw]

MooseFET wrote:
[....]
Thinks like a sudden step in the income tax at $3 Million would be the
sort of thing needed.  When a lot of people suddenly go above the $3
Million mark, it would cause the government to run a surplus and
reduce the money supply.

That would just cause people to earn less than $3M.

No if you look back to the Eisenhower era, you will see that adjusted
for inflation there was such a tax and people did make more than it
and they did pay the high tax.

   We could also have a small tax on all stock
transactions.  The bubbles are also marked by a large increase in the
volume of transactions.  When things go in the other direction,
programs like unemployment insurance would add to the money supply.

The economy is very non-linear.  The gain drops a great deal when the
economy slows down and increases during a boom.  This is why there is
the tendency for it to stick at the bottom of the swing.  whatever you
do needs to change the gain in the other direction.

It's not all that complicated.  The government made a bunch of
changes to get loans for non-creditworthy people.  Don't do
that.

This is not what caused even the bubble that you claim it did cause.
It most certainly isn't what caused the Clinton era bubble.  Note that
the Clinton era one was less of a problem than the last one.

Don't be in the loan business, don't meddle with the incentives,
don't lend money to banks for nothing and let them leverage it
30:1.  Don't.

Failure to regulate is what allows the instabilities in the free
market to be at there worst.  It ensures that we have crash after
crash and that the crashes will be of the worst sort.

Obama's said he doesn't want an economy based on excess borrowing,
yet his every move is to facilitate returning to it as quickly as
possible, and make whole those who should be paying the price.

Right now we have a decreasing money supply.  Injecting money right
now is the right thing to do.  When the economy is doing well is when
to sharply reduce spending etc.  It is basic economics.

That is one economic "school of thought".

The others involve throwing cats over your shoulder after running
around the stump three times.  Think of the economy as a complex servo
system with the money supply as one of the nodes in it.  If you think
about it that way, it should be obvious that the government should
work against changes in the money supply, which ever direction they go
in.

So you think politicians are in the business of stabilizing the
economy?

I think that a well regulated currency and working for the general
welfare are the jobs of government. I seem to remember that some
others a while back thought the same and thought it important enough
to put it down on paper.

You're hopeless. Government's job is perpetuating government and will
always be. Your last sentence is so wrong that it's laughable.

No I don't think they should be making win/lose decisions. They set
the rules of the game. You can't have much of a game without rules.

Then why do you fawn over Obama and his crew of incompetent
communists?

 

[krw]

On Thu, 30 Apr 2009 06:43:57 -0700 (PDT), MooseFET



MooseFET wrote:
[....]
Thinks like a sudden step in the income tax at $3 Million would be the
sort of thing needed. When a lot of people suddenly go above the $3
Million mark, it would cause the government to run a surplus and
reduce the money supply.
That would just cause people to earn less than $3M.
No if you look back to the Eisenhower era, you will see that adjusted
for inflation there was such a tax and people did make more than it
and they did pay the high tax.
We could also have a small tax on all stock
transactions. The bubbles are also marked by a large increase in the
volume of transactions. When things go in the other direction,
programs like unemployment insurance would add to the money supply.
The economy is very non-linear. The gain drops a great deal when the
economy slows down and increases during a boom. This is why there is
the tendency for it to stick at the bottom of the swing. whatever you
do needs to change the gain in the other direction.
It's not all that complicated. The government made a bunch of
changes to get loans for non-creditworthy people. Don't do
that.
This is not what caused even the bubble that you claim it did cause.
It most certainly isn't what caused the Clinton era bubble. Note that
the Clinton era one was less of a problem than the last one.
Don't be in the loan business, don't meddle with the incentives,
don't lend money to banks for nothing and let them leverage it
30:1. Don't.
Failure to regulate is what allows the instabilities in the free
market to be at there worst. It ensures that we have crash after
crash and that the crashes will be of the worst sort.
Obama's said he doesn't want an economy based on excess borrowing,
yet his every move is to facilitate returning to it as quickly as
possible, and make whole those who should be paying the price.
Right now we have a decreasing money supply. Injecting money right
now is the right thing to do. When the economy is doing well is when
to sharply reduce spending etc. It is basic economics.
That is one economic "school of thought".
The others involve throwing cats over your shoulder after running
around the stump three times. Think of the economy as a complex servo
system with the money supply as one of the nodes in it. If you think
about it that way, it should be obvious that the government should
work against changes in the money supply, which ever direction they go
in.

So you think politicians are in the business of stabilizing the
economy?

Of course. What do you think happens to an opamp circuit if you break
the feedback loop?

DO you really think politicians have an interest in such? Evidence
please.

What does that mean?

Think about it. Maybe it'll come to you, comrade.

 

[MooseFET]

[....]
Thinks like a sudden step in the income tax at $3 Million would be the
sort of thing needed.  When a lot of people suddenly go above the $3
Million mark, it would cause the government to run a surplus and
reduce the money supply.
That would just cause people to earn less than $3M.
No if you look back to the Eisenhower era, you will see that adjusted
for inflation there was such a tax and people did make more than it
and they did pay the high tax.
   We could also have a small tax on all stock
transactions.  The bubbles are also marked by a large increase in the
volume of transactions.  When things go in the other direction,
programs like unemployment insurance would add to the money supply.
The economy is very non-linear.  The gain drops a great dealwhen the
economy slows down and increases during a boom.  This is whythere is
the tendency for it to stick at the bottom of the swing.  whatever you
do needs to change the gain in the other direction.
It's not all that complicated.  The government made a bunch of
changes to get loans for non-creditworthy people.  Don't do
that.
This is not what caused even the bubble that you claim it did cause.
It most certainly isn't what caused the Clinton era bubble.  Note that
the Clinton era one was less of a problem than the last one.
Don't be in the loan business, don't meddle with the incentives,
don't lend money to banks for nothing and let them leverage it
30:1.  Don't.
Failure to regulate is what allows the instabilities in the free
market to be at there worst.  It ensures that we have crash after
crash and that the crashes will be of the worst sort.
Obama's said he doesn't want an economy based on excess borrowing,
yet his every move is to facilitate returning to it as quickly as
possible, and make whole those who should be paying the price.
Right now we have a decreasing money supply.  Injecting money right
now is the right thing to do.  When the economy is doing well iswhen
to sharply reduce spending etc.  It is basic economics.
That is one economic "school of thought".
The others involve throwing cats over your shoulder after running
around the stump three times.  Think of the economy as a complex servo
system with the money supply as one of the nodes in it.  If you think
about it that way, it should be obvious that the government should
work against changes in the money supply, which ever direction they go
in.
So you think politicians are in the business of stabilizing the
economy?

I think that a well regulated currency and working for the general
welfare are the jobs of government.  I seem to remember that some
others a while back thought the same and thought it important enough
to put it down on paper.

You're hopeless.  Government's job is perpetuating government and will
always be.  Your last sentence is so wrong that it's laughable.

I suggest you go read the writings of the "founding fathers" of the
US. You will find that they formed the government for the purpose of
ensuring the general welfare. This is the reason for governments to
exist. If this by your definition make the US a communist country,
you need to look a little more closely at how you define things.

 

[krw]

MooseFET wrote:
[....]
Thinks like a sudden step in the income tax at $3 Million would be the
sort of thing needed.  When a lot of people suddenly go above the $3
Million mark, it would cause the government to run a surplus and
reduce the money supply.

That would just cause people to earn less than $3M.

No if you look back to the Eisenhower era, you will see that adjusted
for inflation there was such a tax and people did make more than it
and they did pay the high tax.

   We could also have a small tax on all stock
transactions.  The bubbles are also marked by a large increase in the
volume of transactions.  When things go in the other direction,
programs like unemployment insurance would add to the money supply.

The economy is very non-linear.  The gain drops a great deal when the
economy slows down and increases during a boom.  This is why there is
the tendency for it to stick at the bottom of the swing.  whatever you
do needs to change the gain in the other direction.

It's not all that complicated.  The government made a bunch of
changes to get loans for non-creditworthy people.  Don't do
that.

This is not what caused even the bubble that you claim it did cause.
It most certainly isn't what caused the Clinton era bubble.  Note that
the Clinton era one was less of a problem than the last one.

Don't be in the loan business, don't meddle with the incentives,
don't lend money to banks for nothing and let them leverage it
30:1.  Don't.

Failure to regulate is what allows the instabilities in the free
market to be at there worst.  It ensures that we have crash after
crash and that the crashes will be of the worst sort.

Obama's said he doesn't want an economy based on excess borrowing,
yet his every move is to facilitate returning to it as quickly as
possible, and make whole those who should be paying the price.

Right now we have a decreasing money supply.  Injecting money right
now is the right thing to do.  When the economy is doing well is when
to sharply reduce spending etc.  It is basic economics.

That is one economic "school of thought".

The others involve throwing cats over your shoulder after running
around the stump three times.  Think of the economy as a complex servo
system with the money supply as one of the nodes in it.  If you think
about it that way, it should be obvious that the government should
work against changes in the money supply, which ever direction they go
in.

So you think politicians are in the business of stabilizing the
economy?

I think that a well regulated currency and working for the general
welfare are the jobs of government.  I seem to remember that some
others a while back thought the same and thought it important enough
to put it down on paper.

You're hopeless.  Government's job is perpetuating government and will
always be.  Your last sentence is so wrong that it's laughable.

I suggest you go read the writings of the "founding fathers" of the
US.

I suggest that *YOU* read them. The FF were very wary of government.
You've obviously read nothing of what you speak or you wouldn't be a
stateist either.

You will find that they formed the government for the purpose of
ensuring the general welfare. This is the reason for governments to
exist. If this by your definition make the US a communist country,
you need to look a little more closely at how you define things.

"General welfare" doesn't mean what *you* think it does.

 

[MooseFET]

[....]
Thinks like a sudden step in the income tax at $3 Million would be the
sort of thing needed.  When a lot of people suddenly go above the $3
Million mark, it would cause the government to run a surplus and
reduce the money supply.
That would just cause people to earn less than $3M.
No if you look back to the Eisenhower era, you will see that adjusted
for inflation there was such a tax and people did make more than it
and they did pay the high tax.
   We could also have a small tax on all stock
transactions.  The bubbles are also marked by a large increase in the
volume of transactions.  When things go in the other direction,
programs like unemployment insurance would add to the moneysupply.
The economy is very non-linear.  The gain drops a great deal when the
economy slows down and increases during a boom.  This is why there is
the tendency for it to stick at the bottom of the swing.  whatever you
do needs to change the gain in the other direction.
It's not all that complicated.  The government made a bunchof
changes to get loans for non-creditworthy people.  Don't do
that.
This is not what caused even the bubble that you claim it did cause.
It most certainly isn't what caused the Clinton era bubble.  Note that
the Clinton era one was less of a problem than the last one.
Don't be in the loan business, don't meddle with the incentives,
don't lend money to banks for nothing and let them leverage it
30:1.  Don't.
Failure to regulate is what allows the instabilities in the free
market to be at there worst.  It ensures that we have crash after
crash and that the crashes will be of the worst sort.
Obama's said he doesn't want an economy based on excess borrowing,
yet his every move is to facilitate returning to it as quickly as
possible, and make whole those who should be paying the price..
Right now we have a decreasing money supply.  Injecting moneyright
now is the right thing to do.  When the economy is doing wellis when
to sharply reduce spending etc.  It is basic economics.
That is one economic "school of thought".
The others involve throwing cats over your shoulder after running
around the stump three times.  Think of the economy as a complexservo
system with the money supply as one of the nodes in it.  If you think
about it that way, it should be obvious that the government should
work against changes in the money supply, which ever direction they go
in.
So you think politicians are in the business of stabilizing the
economy?
I think that a well regulated currency and working for the general
welfare are the jobs of government.  I seem to remember that some
others a while back thought the same and thought it important enough
to put it down on paper.
You're hopeless.  Government's job is perpetuating government and will
always be.  Your last sentence is so wrong that it's laughable.

I suggest you go read the writings of the "founding fathers" of the
US.

I suggest that *YOU* read them.  The FF were very wary of government.
You've obviously read nothing of what you speak or you wouldn't be a
stateist either.

They formed a government for the purpose of seeing to the general
welfare. That you can't see the difference between that and what they
opposed is where you are missing the whole point. You have tried
"communist" as an insult but didn't think it was strong enough so you
added "incompetent". Now you are trying "stateist" as an insult.
This really won't impress anyone.

The simple fact is that a gold standard based currency won't work
because it hands the keys to the kingdom to an accident of geology.
No other metal backed currency will work for the same reasons.
Commodity backed currencies are not stable enough This means you are
stuck with a fiat currency. Fiat currencies are regulated by the
government. This means that the government must work against changes
in the money supply if they are to maintain anything like a table
economy. Since the purpose of government is the general welfare,
there is no choice in the matter.

 

[krw]

MooseFET wrote:
[....]
Thinks like a sudden step in the income tax at $3 Million would be the
sort of thing needed.  When a lot of people suddenly go above the $3
Million mark, it would cause the government to run a surplus and
reduce the money supply.

That would just cause people to earn less than $3M.

No if you look back to the Eisenhower era, you will see that adjusted
for inflation there was such a tax and people did make more than it
and they did pay the high tax.

   We could also have a small tax on all stock
transactions.  The bubbles are also marked by a large increase in the
volume of transactions.  When things go in the other direction,
programs like unemployment insurance would add to the money supply.

The economy is very non-linear.  The gain drops a great deal when the
economy slows down and increases during a boom.  This is why there is
the tendency for it to stick at the bottom of the swing.  whatever you
do needs to change the gain in the other direction.

It's not all that complicated.  The government made a bunch of
changes to get loans for non-creditworthy people.  Don't do
that.

This is not what caused even the bubble that you claim it did cause.
It most certainly isn't what caused the Clinton era bubble.  Note that
the Clinton era one was less of a problem than the last one.

Don't be in the loan business, don't meddle with the incentives,
don't lend money to banks for nothing and let them leverage it
30:1.  Don't.

Failure to regulate is what allows the instabilities in the free
market to be at there worst.  It ensures that we have crash after
crash and that the crashes will be of the worst sort.

Obama's said he doesn't want an economy based on excess borrowing,
yet his every move is to facilitate returning to it as quickly as
possible, and make whole those who should be paying the price.

Right now we have a decreasing money supply.  Injecting money right
now is the right thing to do.  When the economy is doing well is when
to sharply reduce spending etc.  It is basic economics.

That is one economic "school of thought".

The others involve throwing cats over your shoulder after running
around the stump three times.  Think of the economy as a complex servo
system with the money supply as one of the nodes in it.  If you think
about it that way, it should be obvious that the government should
work against changes in the money supply, which ever direction they go
in.

So you think politicians are in the business of stabilizing the
economy?

I think that a well regulated currency and working for the general
welfare are the jobs of government.  I seem to remember that some
others a while back thought the same and thought it important enough
to put it down on paper.

You're hopeless.  Government's job is perpetuating government and will
always be.  Your last sentence is so wrong that it's laughable.

I suggest you go read the writings of the "founding fathers" of the
US.

I suggest that *YOU* read them.  The FF were very wary of government.
You've obviously read nothing of what you speak or you wouldn't be a
stateist either.

They formed a government for the purpose of seeing to the general
welfare.

Wrong. They formed a government for the purpose of general defense.
The states and individuals were left to what you call "general
welfare".

That you can't see the difference between that and what they
opposed is where you are missing the whole point.

No it is *you* that misses the entire point. We are *not* a people of
government.

You have tried
"communist" as an insult but didn't think it was strong enough so you
added "incompetent". Now you are trying "stateist" as an insult.
This really won't impress anyone.

Obama is both incompetent and a communist. You are a statist and just
love it when government runs your life (evidently you are incapable).
Facts are facts. You can only be insulted if you don't like who you
are.

The simple fact is that a gold standard based currency won't work
because it hands the keys to the kingdom to an accident of geology.
No other metal backed currency will work for the same reasons.
Commodity backed currencies are not stable enough This means you are
stuck with a fiat currency. Fiat currencies are regulated by the
government. This means that the government must work against changes
in the money supply if they are to maintain anything like a table
economy. Since the purpose of government is the general welfare,
there is no choice in the matter.

What absurd logic. I didn't expect better though.

 

[MooseFET]

[... snip ....]

Here are the exact words that state the purpose:

"We the people of the United States, in order to form a more perfect
union, establish justice, insure domestic tranquility, provide for the
common defense, promote the general welfare, and secure the blessings
of liberty to ourselves and our posterity, do ordain and establish
this Constitution for the United States of America."

Notice "promote the general welfare". There it is right their in the
founding document.

I have something to do perhaps more later.

 

[krw]

[... snip ....]

Here are the exact words that state the purpose:

"We the people of the United States, in order to form a more perfect
union, establish justice, insure domestic tranquility, provide for the
common defense, promote the general welfare, and secure the blessings
of liberty to ourselves and our posterity, do ordain and establish
this Constitution for the United States of America."

Notice "promote the general welfare". There it is right their in the
founding document.

And I repeat, "general welfare" does *NOT* mean what you think it
does. If it did, the rest of the Constitution means nothing.

I have something to do perhaps more later.

I hope not.

 

[MooseFET]

[... snip ....]

Here are the exact words that state the purpose:

"We the people of the United States, in order to form a more perfect
union, establish justice, insure domestic tranquility, provide for the
common defense, promote the general welfare, and secure the blessings
of liberty to ourselves and our posterity, do ordain and establish
this Constitution for the United States of America."

Notice "promote the general welfare".  There it is right their in the
founding document.

And I repeat, "general welfare" does *NOT* mean what you think it
does.

Nonsense you are the one who doesn't seem to know what words mean.

Later in the constitution it says:

"To coin Money, regulate the Value thereof, and of foreign Coin, and
fix the Standard of Weights and Measures;"

Hence the requirement that they work to prevent changes in the money
supply, just like I said they should.

 

[Bob Larter]

[... snip ....]
Here are the exact words that state the purpose:
"We the people of the United States, in order to form a more perfect
union, establish justice, insure domestic tranquility, provide for the
common defense, promote the general welfare, and secure the blessings
of liberty to ourselves and our posterity, do ordain and establish
this Constitution for the United States of America."
Notice "promote the general welfare". There it is right their in the
founding document.
And I repeat, "general welfare" does *NOT* mean what you think it
does.

Nonsense you are the one who doesn't seem to know what words mean.

Later in the constitution it says:

"To coin Money, regulate the Value thereof, and of foreign Coin, and
fix the Standard of Weights and Measures;"

Hence the requirement that they work to prevent changes in the money
supply, just like I said they should.

And this exchange is exactly why i ignore krw.

Ayup. That seems pretty reasonable.