NP - St. Ralph Continues To Advance the Most Important Cause in American Politics, His Ego

Wed Nov 4 20:06:25 CST 2015

The basic drag on the World economy is lack of Consumer demand.  Money is
cheap, but wages are low.  Money needs to shift downward where it will be
spent. That goal is achievable via government.  The U.S. Should lead by
example. Bring back the New Deal.

David Morris

On Wednesday, November 4, 2015, David Morris <fqmorris at gmail.com> wrote:

> Ish,
>
> Your analogy makes no sense, or, more precisely, it doesn't prove your
> thesis. The glut of a commodity harming its producers and traders is
> analogous to cheap money how?  Cheap money does hurt the Banks (money
> suppliers), so I can see that parallel. But the glut of oil isn't a drag on
> the greater economy.  Cheap oil is actually a boon to almost all other
> markets. Without inflation, cheap money also helps practically all
> other markets.  So your analogy seems to support my point, not yours.
>
> David Morris
>
> On Wednesday, November 4, 2015, ish mailian <ishmailian at gmail.com
> <javascript:_e(%7B%7D,'cvml','ishmailian at gmail.com');>> wrote:
>
>> Let me give an example:
>>
>> Do you drive? If you do you know that gasoline is cheap.
>>
>>  Oil, the last of the commodities to burst its bubble is down from 120 to
>> 45 (wti).
>>
>> Demand for oil continues to go up.
>>
>> But the supply is going up much faster.
>>
>> How did so much supply suddenly flood the market?
>>
>> A combination of things: prices were high before the great contraction,
>> so there was an incentive to produce and increase supply.
>>
>> But after the crash, the new technology and increased production and
>> capacity in place, set off a market share battle between OPEC, mainly SA,
>> and the US shale producer, a battle for the US market, where super low
>> interest rates, or cheap loans, kept even the non-competitive producers in
>> business (though the rig count declined and the technology continued to
>> reduce cost), thus driving oil prices lower.
>>
>> Low rates, QE, is disrupting the supply and demad mechanism of major
>> markets like oil, and adding to global liquidity and deflation.
>>
>> Get it?
>>
>> On Tue, Nov 3, 2015 at 10:02 PM, David Morris <fqmorris at gmail.com> wrote:
>>
>>> How do you propose our present consumer Thrift Paradox is the result of
>>> Fed easy money? Government Austerity, pushed by Germans and Republicans
>>> fits that bill, but easy money? How does easy money fit your model of US
>>> consumer Thrift Paradox?
>>>
>>> Your cart leads your horse. US thrift isn't waiting for a better
>>> bargain, it is dragged down by low wages. That reality is too true to deny,
>>> unless you want to deny it.
>>>
>>> You haven't offered a thesis, just many conclusions.
>>>
>>> David Morris
>>>
>>>
>>> On Tuesday, November 3, 2015, ish mailian <ishmailian at gmail.com> wrote:
>>>
>>>> I did provide an answer: the US economy is caught in a thrift paradox
>>>> engineered by the Fed, and that paradox is compounded by the commodities
>>>> super-cycle bust.
>>>>
>>>> The paradox of thrift that was popularized by Keynes has not merely
>>>> dragged the consumer to the sidelines, as she waits to buy the ever cheaper
>>>> HDTV, but has stalled investment spending, as corporations borrow money for
>>>> free or on the cheap, buy back stock or, rather than fight the Fed, join
>>>> her in buying US securities and agency debt.
>>>>
>>>> This has been a favorable trade for years now, and when you count the
>>>> dollar's appreciation, against the Euro, Yen, etc.,  and consider that
>>>> large corporations have operations abroad, where imported products are
>>>> dear, and you can see why investment spending, along with the consumer, is
>>>> stalled by low rates. There is no incentive to invest in future growth.
>>>>
>>>>
>>>>
>>>> No, the textbook guys were wrong (on Fed policy), on monetary policy
>>>>  because zero rates did not cause inflation or the depreciation of the
>>>> dollar.
>>>>
>>>> Now you've shifted away from the Fed to fiscal policy. That's another
>>>> matter. Sure, the textbook would call for both fiscal deficit spending and
>>>> lower rates. And we did get some, not enough, but that's another matter.
>>>>
>>>> What I'm saying is that RD is correct: the Fed shoold raise rates to
>>>> help the retired, and the workers.
>>>>
>>>> We may find out if RN is right, if the Fed raises rates in December and
>>>> the economy continues to expand. The speed at which they normalize the
>>>> yield curve will prove more important that the nominal rate hikes, and I
>>>> guess that they will go very slow. A good plan, though it will not produce
>>>> robust growth. That's not something the Fed can engineer.
>>>>
>>>>
>>>>
>>>>
>>>>
>>>> On Tue, Nov 3, 2015 at 4:18 PM, David Morris <fqmorris at gmail.com>
>>>> wrote:
>>>>
>>>>> You haven't provided any rationale for your claim that raising
>>>>> interest rates will increase demand.
>>>>>
>>>>> You are also wrong that "People who agreed with that textbook view
>>>>> have been wrong about just about everything economic and financial since
>>>>> 2009." The textbook view was never given more than a weak try because of
>>>>> Republican opposition. But the US economy has improved the most in the
>>>>> World since the Recession because we at least shrugged off Austerity and
>>>>> tried a weak Stimulus for a while (but for only a very short while).  Print
>>>>> out free money and distribute it literally, and the consumer demand will
>>>>> instantly reappear.
>>>>>
>>>>> David Morris
>>>>>
>>>>> On Tue, Nov 3, 2015 at 2:50 PM, ish mailian <ishmailian at gmail.com>
>>>>> wrote:
>>>>>
>>>>>> David, you would be right if we could open an economic textbook and
>>>>>> make sense of the great contraction and QE, the broken Phillips Curve and
>>>>>> etc., but we can't. People who agreed with that texbookt view have been
>>>>>> wrong about just about everything economic and financial since 2009. Low
>>>>>> and negative rates and QE were supposed cause inflation, hyper-inflation
>>>>>> even. It was supposed to send gold flying and commodities up up and away
>>>>>> and the dollar down to the bottomless pit.
>>>>>>
>>>>>> In short, sir, with all do respect to you and your textbook view, you
>>>>>> are dead wrong, Hope you didn't lose your ass.
>>>>>>
>>>>>> The Fed can't deliver a robust economy.  A robust economy must be
>>>>>> driven by the consumer. But consumer, with the exception of the recent
>>>>>> appetite for new automobiles, is not consuming. Even after the great
>>>>>> de-leveraging, and zero rates, animal spirits are dead in the water.
>>>>>> Raising interest rates will get the consumer consuming, otherwise we will
>>>>>> need to get used to what Wall Street and the Gangsters have been peddling,
>>>>>> the new normal or secular stagnation, where the risks they are now
>>>>>> prevented from taking are foisted on us, as we have no other choice but to
>>>>>> take on bubbled assets. QE has gone on too long and has caused new kind of
>>>>>> thrift paradox wherein disinflation and deflation, compounded events such
>>>>>> as the reshoring of jobs to automation, the bust of the commodities super
>>>>>> cycle, the collapse of OPEC and oil...technological
>>>>>> innovations....etc...keeps wages down with productivity and keeps consumers
>>>>>> waiting for inflation that is never and never will be produced by low
>>>>>> rates.
>>>>>>
>>>>>> Raising rates will help banks in some respects and hurt the banks in
>>>>>> others, same goes for the wealthy who live off interest income and stock
>>>>>> dividends. But it will help the workers most because it will get that
>>>>>> robust economy, 3-4% on track.
>>>>>>
>>>>>> On Tue, Nov 3, 2015 at 3:07 PM, David Morris <fqmorris at gmail.com>
>>>>>> wrote:
>>>>>>
>>>>>>> Key point:  " As Jordan Weissmann at Slate points out, the entire
>>>>>>> argument doesn’t make a lot of sense, as “relatively few households
>>>>>>> actually survive on interest income.” Most ordinary people would benefit a
>>>>>>> lot more from a robust economy than a higher interest rate on their savings
>>>>>>> account, but Nader seems to assume a nation of people living on investments
>>>>>>> rather than on paychecks, which really undermines his
>>>>>>> spokesman-for-the-working-class schtick."
>>>>>>>
>>>>>>> Raising interest rates will only help the Banks and the rich.  What
>>>>>>> we really need is a massive increase of Federal spending to boost the
>>>>>>> economy, and/or a big boost in the minimum wage, to increase demand.  But,
>>>>>>> failing that, at least keep money cheap.  Increasing interest rates is
>>>>>>> insane when the economy is sluggish and inflation is zero.  A really simple
>>>>>>> point.  All the rest is shuck and jive.
>>>>>>>
>>>>>>> David Morris
>>>>>>>
>>>>>>> On Tue, Nov 3, 2015 at 12:38 PM, ish mailian <ishmailian at gmail.com>
>>>>>>> wrote:
>>>>>>>
>>>>>>>> I don't know much about RN's relationships with female academics or
>>>>>>>> their husbands but he may still claim to be supporting both a rate hike by
>>>>>>>> the Fed and working people, the poor, and the retired, most of whom are not
>>>>>>>> rich but nevertheless, live on investments, the great portion of which is
>>>>>>>> in fixed income securities.
>>>>>>>>
>>>>>>>> One need only give Nader the benefit of the broken Phillip's Curve.
>>>>>>>> There are a growing number of economists who now contend that the
>>>>>>>> continuance of the zero bound policy is hurting the economy and working
>>>>>>>> people because, while unemployment has been driven down to near NAIRU by
>>>>>>>> Fed policy, it will nothing to lift wages and will cost, not only those
>>>>>>>> retired to live on less, but those close to retirement to work longer
>>>>>>>> because investment in safe retirement assets is discouraged while bubbles
>>>>>>>> are made an popped, and, while those indebted must pay off loans with
>>>>>>>> non-inflated wages.
>>>>>>>>
>>>>>>>> The Fed has a triple mandate, though the press and the Fed and
>>>>>>>> Congress confuse things by calling it a duel mandate. The third part is
>>>>>>>> rates. The Fed is charged with keeping rates in a range that promotes
>>>>>>>> growth. It's no doing that now. It is fixated on the Phillips curve model
>>>>>>>> and it's not working now. JY did well to focus on the unemployed and the
>>>>>>>> participation rate and the quit rate etc..., in other words, employment and
>>>>>>>> wages, and ignore inflation. She should continue with that plan. The Fed
>>>>>>>> can't fight the world. At this point, RN is on to something....lift rates
>>>>>>>> to help the working people.
>>>>>>>>
>>>>>>>>
>>>>>>>>
>>>>>>>> On Tue, Nov 3, 2015 at 9:18 AM, David Morris <fqmorris at gmail.com>
>>>>>>>> wrote:
>>>>>>>>
>>>>>>>>> Ralph Nader, epic mansplainer, tells Janet Yellen to listen to her
>>>>>>>>> husband.
>>>>>>>>>
>>>>>>>>>
>>>>>>>>> http://www.salon.com/2015/11/02/ralph_nader_epic_mansplainer_tells_janet_yellen_to_listen_to_her_husband/
>>>>>>>>>
>>>>>>>>> Apparently, Ralph Nader is still talking, though in a way that
>>>>>>>>> certainly inspires a deep desire to go to Tumblr to find as many “shut up”
>>>>>>>>> gifs as one can find. Over the weekend, Nader published a nonsensical piece
>>>>>>>>> at the Huffington Post complaining that “humble savers” are getting screwed
>>>>>>>>> by the Federal Reserve’s unwillingness to raise the interest rate, which
>>>>>>>>> Nader seems to think is an elaborate plot to help the rich banks at the
>>>>>>>>> expense of working people.
>>>>>>>>>
>>>>>>>>> As Jordan Weissmann at Slate points out, the entire argument
>>>>>>>>> doesn’t make a lot of sense, as “relatively few households actually survive
>>>>>>>>> on interest income.” Most ordinary people would benefit a lot more from a
>>>>>>>>> robust economy than a higher interest rate on their savings account, but
>>>>>>>>> Nader seems to assume a nation of people living on investments rather than
>>>>>>>>> on paychecks, which really undermines his spokesman-for-the-working-class
>>>>>>>>> schtick.
>>>>>>>>>
>>>>>>>>
>>>>>>>>
>>>>>>>
>>>>>>
>>>>>
>>>>
>>
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