tag:blogger.com,1999:blog-6616959642391988608.post8994218088364107532..comments2024-03-18T13:22:06.536-07:00Comments on Calafia Beach Pundit: The $1 trillion tax on cashScott Grannishttp://www.blogger.com/profile/14028519647946868684noreply@blogger.comBlogger12125tag:blogger.com,1999:blog-6616959642391988608.post-49504621224251284072014-07-26T14:48:52.847-07:002014-07-26T14:48:52.847-07:00scott, do us all a favor and permanently remove &q...scott, do us all a favor and permanently remove "theyenguy" from all further commentstevehttps://www.blogger.com/profile/07387986994469835875noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-30946026370548295262014-07-26T10:30:08.301-07:002014-07-26T10:30:08.301-07:00Larry Summers gave an insightful interview somewha...Larry Summers gave an insightful interview somewhat related to this discussion. The takeaway to me is that what we think of as historical normal levels of investment and willingness to hold cash, may be different because of the skewed wealth concentration, and the lower levels of capital required for investment today.<br /><br />http://www.newrepublic.com/article/118797/randyhttps://www.blogger.com/profile/16368254229927808998noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-34190761806959346732014-07-25T22:47:08.507-07:002014-07-25T22:47:08.507-07:00Evil savers, preventing inflation.Evil savers, preventing inflation.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-77410678202815592092014-07-25T19:53:44.576-07:002014-07-25T19:53:44.576-07:00Add on:
Central banks, which became independent p...Add on:<br /><br />Central banks, which became independent public agencies in the 1980-1990s (ECB, BoJ and effectively the Fed, under Volcker) act like independent public agencies.<br /><br />That is to say, they developed exalted mission statements, and ossify. These are public agencies, remember? <br /><br />The central banks of the developed world have been cast and then hardened into Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-2475488198361508232014-07-25T19:15:19.819-07:002014-07-25T19:15:19.819-07:00Scott:
I think you are right.
But Japan has had...Scott:<br /><br />I think you are right. <br /><br />But Japan has had little success in raising inflation, and Europe is going the other way, to deflation.<br /><br />As Milton Friedman said, it is hard to tighten your way to higher interest rates for long, Interest rates tend to go down---tight money means lower rates in the long run.<br /><br />But the Fed now is tightening up---so maybe Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-62109963414684594602014-07-25T18:14:06.909-07:002014-07-25T18:14:06.909-07:00The great disinflation started in the early 1980s,...The great disinflation started in the early 1980s, and it was the result of central banks in all major countries severely tightening monetary policy in response to the great inflation of the 1970s. <br /><br />Most central banks remained tight until the early 2000s, with the great exception being the BoJ, which tightened too much. The Fed began to ease in the early- to mid-2000s, and that fueled Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-54193060541372275732014-07-25T17:58:54.542-07:002014-07-25T17:58:54.542-07:00Thanks, Scott. Good points, all.Thanks, Scott. Good points, all.Grechsterhttps://www.blogger.com/profile/08898953158865778397noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-40383430353678477382014-07-25T17:55:03.347-07:002014-07-25T17:55:03.347-07:00To be sure, risk aversion is only beginning to dec...To be sure, risk aversion is only beginning to decline. The first evidence was the drop in gold prices in recent years, followed by the rise in real yields on 5-yr TIPS. C&I Loan growth has picked up quite a bit this year, and that is also good evidence of a decline in risk aversion. The growth of bank savings deposits has declined in recent years, though it still remains decidedly positive. Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-40036304540219092262014-07-25T17:13:56.033-07:002014-07-25T17:13:56.033-07:00Fascinating post, worth re-reading many times.
Bu...Fascinating post, worth re-reading many times.<br /> But we might not see higher interest rates ahead---see Europe and Japan. <br />Okay, I ask Scott Grannis this: infflation and interest rates have been in global secular swwon since the early 1980s. A 30-year trend towards not galloping inflation, but turtle inflation and even minor deflation in Japan.<br />What caused this massive and Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-49408378707002537992014-07-25T16:51:24.325-07:002014-07-25T16:51:24.325-07:00Scott: Isn't the M2 chart, the one showing an ...Scott: Isn't the M2 chart, the one showing an unrelenting rise at the same rate as the past few years, evidence that the demand for money is NOT receding? I'm as shocked as the next guy that the public seems perfectly willing to absorb the purchasing power tax which, as you note, is substantial. But there it is. M2 is not declining, or even rising at a reduced rate.<br /><br />The linkGrechsterhttps://www.blogger.com/profile/08898953158865778397noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-7549296665605378982014-07-25T16:34:16.045-07:002014-07-25T16:34:16.045-07:00I have estimated my interest loss over the two Fed...I have estimated my interest loss over the two FedZero in excess of $150.ooo...<br /><br />This is why I hate the FRB and pray for their demise.<br /><br />On the other hand, you have the big spenders and debtors whom are so glad to be subsidized by others. Hanshttps://www.blogger.com/profile/05183141792723754273noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-45983421741491373462014-07-25T16:01:47.977-07:002014-07-25T16:01:47.977-07:00The six year long enduring bull stock market ended...The six year long enduring bull stock market ended July 25, 2014. The prior financial system peak came in 2007, with the failure of what was thought to be “money good” sub prime debt.<br /><br />The world’s economy was regenerated in 2008 as investors came to trust in the US Federal Reserve monetary policy of QE 1, where Distressed Investments, like those traded in Fidelity Investments FAGIX theyenguyhttps://www.blogger.com/profile/08515095308836729043noreply@blogger.com