<div dir="ltr">Just raise wages. Sure, a good plan, Mark. Normally, the market drives wages higher as unemployment and slack are taken up during recovery, but, again, this is not a normal recovery, so the textbook model is useless. So, thinking out of the text, we need to raise wages anyway because wages will not go up even if the Fed keeps rates at zero for another 2 years and the unemployment rates is drive below the NAIRU, say to 2.5%. Wages won't budge. Why not? Because workers have no bargaining leverage in the new economy. It's that simple. While some minimum wage bargaining is having a small impact, the vast majority of workers have no leverage and can't collectively bargain for anything. The public sectors are under assault from without and within. And they are being dragged to the Supreme Court, again: <div><br></div><div>  <a href="http://www.reuters.com/article/2015/06/30/us-usa-court-unions-idUSKCN0PA1PD20150630">http://www.reuters.com/article/2015/06/30/us-usa-court-unions-idUSKCN0PA1PD20150630</a></div></div><div class="gmail_extra"><br><div class="gmail_quote">On Tue, Nov 3, 2015 at 4:52 PM, Mark Kohut <span dir="ltr"><<a href="mailto:mark.kohut@gmail.com" target="_blank">mark.kohut@gmail.com</a>></span> wrote:<br><blockquote class="gmail_quote" style="margin:0 0 0 .8ex;border-left:1px #ccc solid;padding-left:1ex">"pay to dig holes and fill them up" if necessary---Keynes, paraphrase.<br>
Late capitalism is SO RICH<br>
that maybe guaranteed money---guaranteed annual incomes---is the best<br>
way to counterbalance<br>
the movement of money to the biggest companies....a lot of which is<br>
happening with low interest rates.<br>
Somewhere the homeless or unemployed are being paid (I think 11.50 hr)<br>
to pick up stuff in communities...<br>
they're doing it. Just do it as you can and get a little 11.50<br>
self-respect again.<br>
<div class="HOEnZb"><div class="h5"><br>
<br>
On Tue, Nov 3, 2015 at 4:43 PM, David Morris <<a href="mailto:fqmorris@gmail.com">fqmorris@gmail.com</a>> wrote:<br>
> I meant to say: Print out free money and distribute it liberally, and the<br>
> consumer demand will instantly reappear.<br>
><br>
> On Tue, Nov 3, 2015 at 3:18 PM, David Morris <<a href="mailto:fqmorris@gmail.com">fqmorris@gmail.com</a>> wrote:<br>
>><br>
>> You haven't provided any rationale for your claim that raising interest<br>
>> rates will increase demand.<br>
>><br>
>> You are also wrong that "People who agreed with that textbook view have<br>
>> been wrong about just about everything economic and financial since 2009."<br>
>> The textbook view was never given more than a weak try because of Republican<br>
>> opposition. But the US economy has improved the most in the World since the<br>
>> Recession because we at least shrugged off Austerity and tried a weak<br>
>> Stimulus for a while (but for only a very short while). Print out free<br>
>> money and distribute it literally, and the consumer demand will instantly<br>
>> reappear.<br>
>><br>
>> David Morris<br>
>><br>
>> On Tue, Nov 3, 2015 at 2:50 PM, ish mailian <<a href="mailto:ishmailian@gmail.com">ishmailian@gmail.com</a>> wrote:<br>
>>><br>
>>> David, you would be right if we could open an economic textbook and make<br>
>>> sense of the great contraction and QE, the broken Phillips Curve and etc.,<br>
>>> but we can't. People who agreed with that texbookt view have been wrong<br>
>>> about just about everything economic and financial since 2009. Low and<br>
>>> negative rates and QE were supposed cause inflation, hyper-inflation even.<br>
>>> It was supposed to send gold flying and commodities up up and away and the<br>
>>> dollar down to the bottomless pit.<br>
>>><br>
>>> In short, sir, with all do respect to you and your textbook view, you are<br>
>>> dead wrong, Hope you didn't lose your ass.<br>
>>><br>
>>> The Fed can't deliver a robust economy. A robust economy must be driven<br>
>>> by the consumer. But consumer, with the exception of the recent appetite for<br>
>>> new automobiles, is not consuming. Even after the great de-leveraging, and<br>
>>> zero rates, animal spirits are dead in the water. Raising interest rates<br>
>>> will get the consumer consuming, otherwise we will need to get used to what<br>
>>> Wall Street and the Gangsters have been peddling, the new normal or secular<br>
>>> stagnation, where the risks they are now prevented from taking are foisted<br>
>>> on us, as we have no other choice but to take on bubbled assets. QE has gone<br>
>>> on too long and has caused new kind of thrift paradox wherein disinflation<br>
>>> and deflation, compounded events such as the reshoring of jobs to<br>
>>> automation, the bust of the commodities super cycle, the collapse of OPEC<br>
>>> and oil...technological innovations....etc...keeps wages down with<br>
>>> productivity and keeps consumers waiting for inflation that is never and<br>
>>> never will be produced by low rates.<br>
>>><br>
>>> Raising rates will help banks in some respects and hurt the banks in<br>
>>> others, same goes for the wealthy who live off interest income and stock<br>
>>> dividends. But it will help the workers most because it will get that robust<br>
>>> economy, 3-4% on track.<br>
>>><br>
>>> On Tue, Nov 3, 2015 at 3:07 PM, David Morris <<a href="mailto:fqmorris@gmail.com">fqmorris@gmail.com</a>> wrote:<br>
>>>><br>
>>>> Key point:Â " As Jordan Weissmann at Slate points out, the entire<br>
>>>> argument doesn’t make a lot of sense, as “relatively few households actually<br>
>>>> survive on interest income.†Most ordinary people would benefit a lot more<br>
>>>> from a robust economy than a higher interest rate on their savings account,<br>
>>>> but Nader seems to assume a nation of people living on investments rather<br>
>>>> than on paychecks, which really undermines his<br>
>>>> spokesman-for-the-working-class schtick."<br>
>>>><br>
>>>> Raising interest rates will only help the Banks and the rich. What we<br>
>>>> really need is a massive increase of Federal spending to boost the economy,<br>
>>>> and/or a big boost in the minimum wage, to increase demand. But, failing<br>
>>>> that, at least keep money cheap. Increasing interest rates is insane when<br>
>>>> the economy is sluggish and inflation is zero. A really simple point. All<br>
>>>> the rest is shuck and jive.<br>
>>>><br>
>>>> David Morris<br>
>>>><br>
>>>> On Tue, Nov 3, 2015 at 12:38 PM, ish mailian <<a href="mailto:ishmailian@gmail.com">ishmailian@gmail.com</a>><br>
>>>> wrote:<br>
>>>>><br>
>>>>> I don't know much about RN's relationships with female academics or<br>
>>>>> their husbands but he may still claim to be supporting both a rate hike by<br>
>>>>> the Fed and working people, the poor, and the retired, most of whom are not<br>
>>>>> rich but nevertheless, live on investments, the great portion of which is in<br>
>>>>> fixed income securities.<br>
>>>>><br>
>>>>> One need only give Nader the benefit of the broken Phillip's Curve.<br>
>>>>> There are a growing number of economists who now contend that the<br>
>>>>> continuance of the zero bound policy is hurting the economy and working<br>
>>>>> people because, while unemployment has been driven down to near NAIRU by Fed<br>
>>>>> policy, it will nothing to lift wages and will cost, not only those retired<br>
>>>>> to live on less, but those close to retirement to work longer because<br>
>>>>> investment in safe retirement assets is discouraged while bubbles are made<br>
>>>>> an popped, and, while those indebted must pay off loans with non-inflated<br>
>>>>> wages.<br>
>>>>><br>
>>>>> The Fed has a triple mandate, though the press and the Fed and Congress<br>
>>>>> confuse things by calling it a duel mandate. The third part is rates. The<br>
>>>>> Fed is charged with keeping rates in a range that promotes growth. It's no<br>
>>>>> doing that now. It is fixated on the Phillips curve model and it's not<br>
>>>>> working now. JY did well to focus on the unemployed and the participation<br>
>>>>> rate and the quit rate etc..., in other words, employment and wages, and<br>
>>>>> ignore inflation. She should continue with that plan. The Fed can't fight<br>
>>>>> the world. At this point, RN is on to something....lift rates to help the<br>
>>>>> working people.<br>
>>>>><br>
>>>>><br>
>>>>><br>
>>>>> On Tue, Nov 3, 2015 at 9:18 AM, David Morris <<a href="mailto:fqmorris@gmail.com">fqmorris@gmail.com</a>><br>
>>>>> wrote:<br>
>>>>>><br>
>>>>>> Ralph Nader, epic mansplainer, tells Janet Yellen to listen to her<br>
>>>>>> husband.<br>
>>>>>><br>
>>>>>><br>
>>>>>> <a href="http://www.salon.com/2015/11/02/ralph_nader_epic_mansplainer_tells_janet_yellen_to_listen_to_her_husband/" rel="noreferrer" target="_blank">http://www.salon.com/2015/11/02/ralph_nader_epic_mansplainer_tells_janet_yellen_to_listen_to_her_husband/</a><br>
>>>>>><br>
>>>>>> Apparently, Ralph Nader is still talking, though in a way that<br>
>>>>>> certainly inspires a deep desire to go to Tumblr to find as many “shut upâ€<br>
>>>>>> gifs as one can find. Over the weekend, Nader published a nonsensical piece<br>
>>>>>> at the Huffington Post complaining that “humble savers†are getting screwed<br>
>>>>>> by the Federal Reserve’s unwillingness to raise the interest rate, which<br>
>>>>>> Nader seems to think is an elaborate plot to help the rich banks at the<br>
>>>>>> expense of working people.<br>
>>>>>><br>
>>>>>> As Jordan Weissmann at Slate points out, the entire argument doesn’t<br>
>>>>>> make a lot of sense, as “relatively few households actually survive on<br>
>>>>>> interest income.†Most ordinary people would benefit a lot more from a<br>
>>>>>> robust economy than a higher interest rate on their savings account, but<br>
>>>>>> Nader seems to assume a nation of people living on investments rather than<br>
>>>>>> on paychecks, which really undermines his spokesman-for-the-working-class<br>
>>>>>> schtick.<br>
>>>>><br>
>>>>><br>
>>>><br>
>>><br>
>><br>
><br>
</div></div></blockquote></div><br></div>