tag:blogger.com,1999:blog-6616959642391988608.post6579182901809273467..comments2024-03-18T13:22:06.536-07:00Comments on Calafia Beach Pundit: The counterintuitive relationship between money growth and inflationScott Grannishttp://www.blogger.com/profile/14028519647946868684noreply@blogger.comBlogger23125tag:blogger.com,1999:blog-6616959642391988608.post-64462671205513173952010-04-19T20:34:51.853-07:002010-04-19T20:34:51.853-07:00Mr. Grannis:
Excellent analysis.
Yes, it is cou...Mr. Grannis:<br /><br />Excellent analysis. <br /><br />Yes, it is counterintuitive like some many items in the field of economics. <br /><br />Velocity just doesn’t get headlines. However, velocity is a very, very interesting phenomena.W.E. Heasleyhttps://www.blogger.com/profile/00368333904571061995noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-78950311951635215202010-04-19T19:35:04.486-07:002010-04-19T19:35:04.486-07:00Benjamin: If you read the posts, they pose questio...Benjamin: If you read the posts, they pose questions, not assertions. What prompted the questions was the observation that the left and the right have an enourmous amount of people who are very vocal about what to do with other peoples money. The tea party wants supporters seem to support SS and Medicare and the Left seems to support new and expanding programs. The question is, why aren't dr. jhttps://www.blogger.com/profile/13109493108309557229noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-65840915931863420532010-04-19T16:08:12.268-07:002010-04-19T16:08:12.268-07:00My,
You have obviously lived a long, long time......My,<br /><br />You have obviously lived a long, long time....I'd say maybe..19. <br /><br />maybe.Johnhttps://www.blogger.com/profile/11652253509768573561noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-14360116907230328922010-04-19T09:56:19.904-07:002010-04-19T09:56:19.904-07:00Hahaha. This is from someone who is unable to pro...Hahaha. This is from someone who is unable to provide specifics when I ask your rationale behind your broad sweeping statements without any reasoning behind them. I guess ad hominem attacks work when you are unable to back up your statements with any detailed knowledge. <br /><br />Let's just say while you were busy counting your money, I was busy publicly calling all of the crises around Unknownhttps://www.blogger.com/profile/13933906293075024659noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-11478015065905146372010-04-19T09:07:21.186-07:002010-04-19T09:07:21.186-07:00Well, being a strict constructionist, I believe in...Well, being a strict constructionist, I believe in one man, one vote. For me, that is the end of the discussion.<br /><br />Beyond that, people do pay federal taxes, beyond income taxes, such as payroll and gasoline taxes. <br /><br />Beyond even that, would you deny stay-at-home housewives (with no income to report) the right to vote? Just exactly do you go about parsing this right to vote? <br Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-35461097053491499662010-04-19T09:06:22.514-07:002010-04-19T09:06:22.514-07:00My: you sound awfully confident for someone who do...My: you sound awfully confident for someone who doesn't know much, if anything, about the subject.Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-91944797776414868082010-04-19T08:59:12.320-07:002010-04-19T08:59:12.320-07:00M2 is too broad of a measurement when attempting t...M2 is too broad of a measurement when attempting to define velocity. What "research" leads you to believe M2 is tbe best measurement of money when talking about velocity? M1 is the only accurate money component when referring to velocity. It's no coincidence the Federal Reserve does not measure M2 velocity. It's an oxymoron. And so is the Mises TMS when talking about Unknownhttps://www.blogger.com/profile/13933906293075024659noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-42605652487972956272010-04-19T05:30:48.241-07:002010-04-19T05:30:48.241-07:00Thank you for such an illuminating contribution.Thank you for such an illuminating contribution.Johnhttps://www.blogger.com/profile/11652253509768573561noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-32953054615552842462010-04-18T19:06:18.206-07:002010-04-18T19:06:18.206-07:00Benjamin: What does being a Constructionist have ...Benjamin: What does being a Constructionist have to do with the question. If people pay SS and Medicare they have skin in that game. If they do not pay Income Taxes and will not be on the hook for the Federal debt, the question is, do they have a voice in those matters? Can tyranny be wielded by those who may noting into a given system, but have a say in that system? The question was dr. jhttps://www.blogger.com/profile/13109493108309557229noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-24871652756527485922010-04-18T12:17:21.875-07:002010-04-18T12:17:21.875-07:00Dr. J:
Many people pay payroll taxes, and excise ...Dr. J:<br /><br />Many people pay payroll taxes, and excise taxes, even if they pay no income taxes. Federal gasoline taxes. <br /><br />I see no Constitutional way to deprive people of representation in a democracy on the basis of how much income tax they pay. <br /><br />As a strict constructionist, I find such sentiments appalling. <br /><br />I would like to see the USA move to a system of Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-3677022306456415312010-04-18T11:14:01.337-07:002010-04-18T11:14:01.337-07:00Public Library,
Scott had a comment on your quest...Public Library,<br /><br />Scott had a comment on your question under the "more signs of a housing bottom" thread.Johnhttps://www.blogger.com/profile/11652253509768573561noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-59817915622161509012010-04-18T10:28:28.552-07:002010-04-18T10:28:28.552-07:00Scott,
What are your thoughts on Goldman?Scott,<br /><br />What are your thoughts on Goldman?Public Libraryhttps://www.blogger.com/profile/00017383928897945054noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-1194155975453368252010-04-18T09:09:47.545-07:002010-04-18T09:09:47.545-07:00Tea Party Question: If 40% of the population does...Tea Party Question: If 40% of the population does not pay any Federal Income Tax, do they have any right to comment about what the government does or does not do with money? Bailouts and debt are not their burden. They are observers with absolutely no skin in the game or obligation to pay for the debt that is created. So, without taxation do they merit representation? Should they simply justdr. jhttps://www.blogger.com/profile/13109493108309557229noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-37272560779793692242010-04-18T06:44:21.151-07:002010-04-18T06:44:21.151-07:00Scott this supports your long term thesis that the...Scott this supports your long term thesis that the fed needs to raise short term rates in order to prevent inflation. I see inflation in the things that I buy. I do think though that there is some probability of a melt down of the financial system. If a meltdown happened, it wolud of course be deflationary. Then I think the government would be monetizing the debt to get out of it but who ronraschhttps://www.blogger.com/profile/14708698068353771219noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-187157439006169652010-04-18T04:32:47.224-07:002010-04-18T04:32:47.224-07:00Or maybe the inflation we had since 2002 or so had...Or maybe the inflation we had since 2002 or so had nothing to do with American monetary policy and everything to do with increasing emerging markets demand for raw materials and not enough supply. It would be interesting to aggregate money supply statistics from across the world and then look at inflation on a region-by-region basis. While we are not seeing inflation in the US with the expansion DaleWhttps://www.blogger.com/profile/16369657928022546882noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-8011782992815248782010-04-17T16:46:24.680-07:002010-04-17T16:46:24.680-07:00My: I think that the process I have described is o...My: I think that the process I have described is only of correlation: higher inflation, which usually means higher growth in nominal GDP, is possible without a corresponding increase in money, because velocity can make up the difference. <br /><br />There is no rule that says M1 is the best measure of money. My research over the years points me to M2 as the most reliable indicator. <br /><br />I Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-55584342588398213112010-04-17T16:42:10.281-07:002010-04-17T16:42:10.281-07:00Jake: that's almost exactly the way things are...Jake: that's almost exactly the way things are supposed to work. One exception: a proactive Fed shouldn't wait for inflation to rise before reducing bank reserves and thus raising short-term interest rates. Another exception: draining reserves doesn't always result in a reduced money supply. Another exception: inflation can go up even if money supply doesn't grow very much (Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-35470663119294169202010-04-17T07:56:37.471-07:002010-04-17T07:56:37.471-07:00There should be a money supply chain in the defini...There should be a money supply chain in the definition somewhere, long term money distributed down to short term money, and money can flow in reverse in this supply chain.<br />So when M(short term) builds up, it pushes back into M(longer term).<br /><br />This model should exist, but I mainly get confused definitions of Mx when I look.<br /><br />Right? Am I wrong?Matt Younghttps://www.blogger.com/profile/08404998406161097199noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-32067836200090430102010-04-16T17:15:33.379-07:002010-04-16T17:15:33.379-07:00My,
That is one hilarious comment. "Look dow...My,<br /><br />That is one hilarious comment. "Look down at your belly"<br /><br />Classic stuff!Public Libraryhttps://www.blogger.com/profile/00017383928897945054noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-6453288334275266672010-04-16T17:09:01.970-07:002010-04-16T17:09:01.970-07:00I have made this same point many times. M2 inclu...I have made this same point many times. M2 includes MMMFs which is definitely a reflection of money demand.<br /><br />Short term instruments when owned by banks don't get counted as money, but when owned by MMMFs, they do. Hence the M2 anomoly.<br /><br />A much better measure of money supply is TMS. Check it out http://is.gd/b4cIn .Fullcarryhttps://www.blogger.com/profile/01654174575386120137noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-62657217360868773562010-04-16T14:53:26.075-07:002010-04-16T14:53:26.075-07:00Hahaha. You succumb to the naive perspective that...Hahaha. You succumb to the naive perspective that correlation equals causation. First of all M1 is the best measurement of money because it is what is actually available for people to pay their bills. Secondly, we do not and have not had inflation by its true definition in this country for thirty years. Our economy has been deflating for over thirty years and it is simply that expansion of Unknownhttps://www.blogger.com/profile/13933906293075024659noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-43276835398535832062010-04-16T14:45:11.229-07:002010-04-16T14:45:11.229-07:00This chart reads like mud thrown on a dirt floor a...This chart reads like mud thrown on a dirt floor at night. <br /><br />You detect a pattern, or counterintuitive pattern, or chimera of a relationship?Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-84946422164053574172010-04-16T12:51:33.831-07:002010-04-16T12:51:33.831-07:00Scott- isn't another thought that money supply...Scott- isn't another thought that money supply is controlled by the Fed and the Fed has a mandate to target inflation in the 2% range. As a result when inflation rises, the Fed removes money (which raises rates) and when inflation falls the Fed supplies money (which reduces rates)?Jakehttps://www.blogger.com/profile/07946497592651234440noreply@blogger.com