The "Big Economic Lie" and why rates matter...

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Re: The

Postby Indaswamp » Wed Oct 09, 2013 5:39 pm

beretta24 wrote:
aunt betty wrote:
beretta24 wrote:
aunt betty wrote:My personal economy would be awsome if I could simply go further and further into debt.
Why can't spinnerman admit that there is a finite limit and eventually the buck stops here?

He never said there wasn't. He just questions whether we've reached it or are near it. To me, the decreased rate of return on debt is evidence we're near the limit. The million dollar question is what is the magnitude of the pending correction.

Sounds like two oil men arguing over whether or not we passed "peak production" to me.

Nah, I gotta side with swamp on this one. When we pull back on QE I don't see how we avoid a 20 percent plus correction in the market. Some would argue >50 percent. Regardless, our standard of living has likely passed its peak won't be at that level for 10 plus years at least.
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Depends on the monetary system in play. If we stay on the dollar reserve standard, it could very well be 20 years...If they change the monetary system, they could possible roll back the clock a little and repeat the same BS again......but not without a lot of bumps along the way, and not without avoiding a severe crash.
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Re: The "Big Economic Lie" and why rates matter...

Postby beretta24 » Wed Oct 09, 2013 5:43 pm

Agreed
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Re: The

Postby SpinnerMan » Wed Oct 09, 2013 5:51 pm

beretta24 wrote:Nah, I gotta side with swamp on this one. When we pull back on QE I don't see how we avoid a 20 percent plus correction in the market.
The MARKET is not the ECONOMY. They are not the same thing. Long run positively correlated. Short term uncorrelated. Apples and Oranges.

Crony Capitalism, big government, basic Obamanomics is good for big business.

For example. Obamacare - big business no impact - small business gets hammered.

There is a huge economy of scale associated with dealing with big government and big bureaucracy. Who else can afford to buy politicians, hire an army of lawyers to deal with the bureaucracy, etc.

Look at Europe. Most industries are dominated by a single giant. Eventually, the line just gets so blurred they quit even pretending that it still exists.

Now, you might be on to something. Obama may not know the difference between the market and the economy. I believe he has conflated the two in the past.
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Re: The "Big Economic Lie" and why rates matter...

Postby beretta24 » Wed Oct 09, 2013 5:56 pm

The economy is already hosed...remove QE and instant recession. The market will just ignore it as long as the economy is being propped up.
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Re: The

Postby Indaswamp » Wed Oct 09, 2013 6:02 pm

SpinnerMan wrote:
beretta24 wrote:Nah, I gotta side with swamp on this one. When we pull back on QE I don't see how we avoid a 20 percent plus correction in the market.
The MARKET is not the ECONOMY. They are not the same thing. Long run positively correlated. Short term uncorrelated. Apples and Oranges.

Crony Capitalism, big government, basic Obamanomics is good for big business.

For example. Obamacare - big business no impact - small business gets hammered.

There is a huge economy of scale associated with dealing with big government and big bureaucracy. Who else can afford to buy politicians, hire an army of lawyers to deal with the bureaucracy, etc.

Look at Europe. Most industries are dominated by a single giant. Eventually, the line just gets so blurred they quit even pretending that it still exists.

Now, you might be on to something. Obama may not know the difference between the market and the economy. I believe he has conflated the two in the past.

The MONETARY SYSTEM affects BOTH!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! :hammer: :hammer: :hammer: :hammer: :hammer: :hammer: :hammer: :hammer:
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Re: The

Postby Indaswamp » Wed Oct 09, 2013 6:10 pm

beretta24 wrote:The economy is already hosed...remove QE and instant recession. The market will just ignore it as long as the economy is being propped up.

Yep....It's baked in the cake.
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Re: The "Big Economic Lie" and why rates matter...

Postby Indaswamp » Wed Oct 09, 2013 6:34 pm

Another little slice of truth:
http://market-ticker.org/akcs-www?post=224995
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Re: The "Big Economic Lie" and why rates matter...

Postby cartervj » Wed Oct 09, 2013 8:12 pm

Keep hearing that the automotive loan bubble is building rapidly.
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Re: The "Big Economic Lie" and why rates matter...

Postby Indaswamp » Wed Oct 09, 2013 10:13 pm

cartervj wrote:Keep hearing that the automotive subprime loan bubble is building rapidly.

FIFY...
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Re: The "Big Economic Lie" and why rates matter...

Postby beretta24 » Wed Oct 09, 2013 10:25 pm

No kidding, just bought a car for the wife this week. They looked at me like I was crazy to ask if they would drop the price to pay in cash. I mean, who the hell buys anything they have the money to purchase. In the end we financed because my wife had zero loan history, and I can make more investing the cash than we'll get charged in interest.

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Re: The

Postby SpinnerMan » Thu Oct 10, 2013 5:46 am

beretta24 wrote:The economy is already hosed...remove QE and instant recession. The market will just ignore it as long as the economy is being propped up.

So you believe that QE is working? :eek:

I think it works as well as the porkulus bill. It is bad policy and does harm and no good. These policies do not work. They don't prop up the economy. They hold it down. That's why we never hear how good things our, but only how they would be worse without them. If they worked, they would work. They don't work.
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Re: The "Big Economic Lie" and why rates matter...

Postby beretta24 » Thu Oct 10, 2013 6:53 am

No, its not working, but it is helping create the illusion of growth. As long as the Fed and Gov can tell a good story the masses will trudge along. Remove the stimulus and GDP goes negative along with the feel good story of a recovery that never happened.
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Re: The "Big Economic Lie" and why rates matter...

Postby SpinnerMan » Thu Oct 10, 2013 8:18 am

beretta24 wrote:No, its not working, but it is helping create the illusion of growth.
It's not doing that at all. The reason it does not work and it is not creating the illusion of growth, is that it is just a complex version of the free lunch fallacy.

Where does the money come from that they are using to buy the things they are buying?

Again, every single penny they spend, they had to take in some form from someone even if that person was unaware it was taken because they took it by devaluing their money. One more penny for them. One less penny for someone else. Who would have spent that penny more wisely?

Redistribution of wealth in every form does not create growth or the illusion of it. It creates fear and economic inefficiency because it nearly always takes from the productive and gives to the less productive. The fear is that they are going to take more. The inefficiency because they take from those that would have produced more and give it to those that will produce less.

This policies do not work. That's why you never hear them say, look how good things are. It's always, it would be worse, we can't stop, and if we had only done more, then things would have worked out this time.

beretta24 wrote:Remove the stimulus and GDP goes negative along with the feel good story of a recovery that never happened.
There is no more stimulus than any other welfare program. It is anti-growth and pro-centralized control. That is economic Ambien.

How long have they been doing it and there is still no end in sight? Maybe it does not work :huh:
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Re: The "Big Economic Lie" and why rates matter...

Postby Indaswamp » Mon Oct 14, 2013 9:48 pm

I wanted to post this before I left out of town...here ya go spinner:
http://market-ticker.org/akcs-www?post=225025
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Re: The "Big Economic Lie" and why rates matter...

Postby Indaswamp » Wed Oct 16, 2013 11:24 am

Some people are waking up and beginning to "get it"....
"So the debt increased twice as much as the economy over the last two years, the very definition of unsustainable. The growth of a nation’s debt cannot for long exceed the growth of its economy – which is precisely what is happening now."

http://market-ticker.org/akcs-www?post=225128
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