tag:blogger.com,1999:blog-6616959642391988608.post6433428878335696832..comments2024-03-28T00:18:25.641-07:00Comments on Calafia Beach Pundit: The bond market is waking upScott Grannishttp://www.blogger.com/profile/14028519647946868684noreply@blogger.comBlogger25125tag:blogger.com,1999:blog-6616959642391988608.post-78009370827511682002021-10-26T19:27:27.411-07:002021-10-26T19:27:27.411-07:00I think that the people who made the decisions to ...I think that the people who made the decisions to shut us down were familiar with laptops, but not big rigs.--KT Cat<br /><br />Amen. Elon Musk said that manufacturing is the hardest thing to do, much harder than anticipated. I was in simple manufacturing for 20 years (furniture), and even that was an endless challenge.<br /><br />Building, farming, manufacturing, transportation--this stuff is Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-35019414921872503522021-10-26T16:26:06.221-07:002021-10-26T16:26:06.221-07:00I think what we're seeing is like an egg going...I think what we're seeing is like an egg going through a snake. A very, very BIG egg. We shut things down for quite a while and now we're trying to go back to full speed. I think that the people who made the decisions to shut us down were familiar with laptops, but not big rigs.K T Cathttps://www.blogger.com/profile/10259428595745509790noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-62868468403086523202021-10-26T10:03:52.620-07:002021-10-26T10:03:52.620-07:00KT yeah, for me it does seem semi-normal. I was t...KT yeah, for me it does seem semi-normal. I was thinking about schools - perpetual masking, closures, coming pressure to vaccinate - I'm semi depressed. Glad I didn't have to raise my kids in this environment. randyhttps://www.blogger.com/profile/16368254229927808998noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-11213902286662493992021-10-26T08:51:17.927-07:002021-10-26T08:51:17.927-07:00Randy, it depends where you are. Many states are b...Randy, it depends where you are. Many states are back to normal. My own California, at least here in San Diego, to a great extent, is back to normal. If you turn off the TV and social media, I think things look a lot more normal.K T Cathttps://www.blogger.com/profile/10259428595745509790noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-32104862949026097302021-10-26T05:53:44.745-07:002021-10-26T05:53:44.745-07:00Benjamin: Is there any point where we can just go...Benjamin: Is there any point where we can just go back to normal?<br /><br />Not in the foreseeable future. The left has invested too much into the political position of appearing like the "serious experts", and demonizing anything else. It's also been too valuable to mask (pun intended) the failures in virtually every other policy domain. It seems it would take a new randyhttps://www.blogger.com/profile/16368254229927808998noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-62069122030348451292021-10-26T05:04:57.003-07:002021-10-26T05:04:57.003-07:00"OK...are the number of breakthrough cases hi..."OK...are the number of breakthrough cases high enough to warrant lockdowns and other measures?"<br />OK and i agree with smaller government to GDP.<br />But the idea is that decisions based on wrong assumptions or weak fundamentals are likely to be of lesser quality (at the individual and collective levels).<br />Smaller government doesn't mean more stupid government, something Carlhttps://www.blogger.com/profile/01792779708580094262noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-64629081581243540722021-10-26T01:30:29.045-07:002021-10-26T01:30:29.045-07:00"South Korea is set to gradually phase out co..."South Korea is set to gradually phase out coronavirus restrictions starting next month as the vaccination rate rises, joining a list of countries embracing a new scheme of returning to normal life with the coronavirus.<br /><br />The scheme, dubbed "Living with COVID-19," is set to take effect in early November. It means that COVID-19 will be treated as an infectious respiratory Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-21032012563641467392021-10-26T00:17:23.083-07:002021-10-26T00:17:23.083-07:00Lower vaccination rates in the younger cohorts wil...Lower vaccination rates in the younger cohorts will result, eventually, in higher rates of breakthrough cases in older cohorts. It's basic and biologic reasoning, uncontaminated by politics.--Carl<br /><br />OK...are the number of breakthrough cases high enough to warrant lockdowns and other measures? <br /><br />I get the sense of goalposts being moved...again. <br /><br />We are wearing Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-18626411681409834472021-10-25T20:11:06.849-07:002021-10-25T20:11:06.849-07:00"Math is a beautiful thing."
Yes there i..."Math is a beautiful thing."<br />Yes there is some math involved but the post is framed to suggest conclusions that are not a balanced and transparent representation of underlying data, if put in proper perspective.<br />Look at the following:<br />https://www.kff.org/policy-watch/Carlhttps://www.blogger.com/profile/01792779708580094262noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-52282684032195790832021-10-25T17:44:56.170-07:002021-10-25T17:44:56.170-07:00Cliff Claven: I have no axe to grind.
I look at ...Cliff Claven: I have no axe to grind. <br /><br />I look at the numbers on Covid-19 and I can't make heads or tails of anything. <br /><br />My guess is there should be free vaccinations for anyone who wants one and we drop the matter.<br /><br />I thought the same thing a year ago.Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-28187573563794052152021-10-25T17:30:13.319-07:002021-10-25T17:30:13.319-07:00TEOTWAWKI...except the S&P 500 just struck a n...TEOTWAWKI...except the S&P 500 just struck a new all-time zenith. They say Wall Street is forward-looking.<br /><br />These are the good old days for corporate profits, much higher than even the Reagan days.(Biden gets a no credit for that and Trump a little).<br /><br />Washington? More guns and butter for the fat and safe.Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-25291245512543631332021-10-25T16:34:56.197-07:002021-10-25T16:34:56.197-07:00Grumpy Economist -- that's funny
Scott is the ...Grumpy Economist -- that's funny<br />Scott is the Happy Economist -- much more pleasant.<br />er <br />Nations with a high level of debt in the past have had slow rates of real economic growth than lower debt nations. I see no reason that relationship would have changed.<br />High levels of debt are often a symptom of reckless government spending. Kind of like the US in 2020 and 2021.<br />The Cliff Claven of Financehttps://www.blogger.com/profile/13541954550199246606noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-1467385690523433452021-10-25T16:31:23.912-07:002021-10-25T16:31:23.912-07:00K T Cat: that quote from John Cochrane is excellen...K T Cat: that quote from John Cochrane is excellent. I regard him as one of the best economists living today and I try to read everything he writes. <br /><br />https://johnhcochrane.blogspot.com/<br /><br />Sadly, the Democratic Party seems completely ignorant of supply-side fundamentals. That is one of the greatest threats our country faces today: economic ignorance. Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-21233819399173016102021-10-25T10:30:08.882-07:002021-10-25T10:30:08.882-07:00I think what's playing out is the effects of a...I think what's playing out is the effects of a new economic theory that is well-described by <a href="https://johnhcochrane.blogspot.com/2021/04/ip-on-bidenomics.html" rel="nofollow">The Grumpy Economist</a>. Here's a key snippet:<br /><br /><i>Growth<br /><br />Old view: Scarcity is the default condition of economies: the demand for goods, services, labor and capital is limitless, their K T Cathttps://www.blogger.com/profile/10259428595745509790noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-80989527137542996992021-10-25T07:25:16.289-07:002021-10-25T07:25:16.289-07:00" around 7% nominal GDP growth over thirty ye..." around 7% nominal GDP growth over thirty years(!)"; "If people bet only on financial repression to get out of this excess debt mess, perhaps people should expect more repression than just the financial kind."; "PS#3 It’s not only the longer growth potential that’s eroding. Q3 (and Q4) of this year’s growth expectations are also dwindling like snow melting away on a wkevinwhttps://www.blogger.com/profile/17600473578823788550noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-60140600013663377202021-10-25T03:51:43.759-07:002021-10-25T03:51:43.759-07:00^The average US government debt maturity is at aro...^The average US government debt maturity is at around 72 months, 31% of Treasury maturities are within 1 year and 54%, within 3 years, so there would be a lag but not that long. Longer term, inflation tends to correlate strongly to interest rates and the key figure to watch (whatever interest/inflation rates prevailing) is the ratio of public debt to GDP. Note: the trend has been poor. Since 2012Carlhttps://www.blogger.com/profile/01792779708580094262noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-67328049746666855592021-10-24T07:38:05.974-07:002021-10-24T07:38:05.974-07:00A good friend of mine blogged this bit a while bac...A good friend of mine blogged this bit a while back discussing how the US got out of a similar debt trap after WW II. <a href="https://www.wcvarones.com/2012/01/silicon-t-bill.html" rel="nofollow">https://www.wcvarones.com/2012/01/silicon-t-bill.html</a><br /><br />He also agrees with Scott and suggests that the Fed will deliberately keep inflation in the mid-single-digits to erode the debt.K T Cathttps://www.blogger.com/profile/10259428595745509790noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-79156935522478321862021-10-24T07:16:08.797-07:002021-10-24T07:16:08.797-07:00Scott - thanks so much for your thorough reply. I ...Scott - thanks so much for your thorough reply. I think I understand things a bit better now and see how the Fed actually has more room to maneuver than I thought.K T Cathttps://www.blogger.com/profile/10259428595745509790noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-86366944093368367412021-10-23T16:52:38.447-07:002021-10-23T16:52:38.447-07:00“Where are the funds the Fed spent to purchase tre...“Where are the funds the Fed spent to purchase treasuries? In reserves? Can the Fed sell treasuries back to banks?<br />What control does Fed have over the M2 funds? »<br />There is some confusion here and it’s helpful to think along a balance sheet model since even supply-siders don’t seem to realize that the US has entered the vicinity of MMT since the GFC, in an accelerating mode since 2016 Carlhttps://www.blogger.com/profile/01792779708580094262noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-69645411992515735572021-10-23T15:25:00.140-07:002021-10-23T15:25:00.140-07:00K T Cat: For the past several years, Treasury has ...K T Cat: For the past several years, Treasury has been selling debt with maturities skewed to longer maturities. That's one reason the Fed has had to step in and reverse that by being longer maturities and issuing short-term bank reserves (which pay interest, so they are in effect T-bill equivalents) in exchange. This was done to satisfy the market's craving for cash and cash equivalents.Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-31814753285026781752021-10-23T06:29:46.640-07:002021-10-23T06:29:46.640-07:00wkevinw - "socio-political/maleducation causi...wkevinw - "socio-political/maleducation causing low economic/business IQ in the general population." I've seen this in action, in my conversations with many people, particularly the younger generations, but I've never thought of it this way. Brilliant summation. Thanks!<br /><br />Scott - I still can't wrap my head around rising interest rates. As I understand it, governmentK T Cathttps://www.blogger.com/profile/10259428595745509790noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-25161951041127491342021-10-22T15:18:12.861-07:002021-10-22T15:18:12.861-07:00Re "Where are the funds the Fed spent to purc...Re "Where are the funds the Fed spent to purchase treasuries?"<br /><br />Tracing the money through all its stages is beyond my capabilities. But I can say that when the dust settled, this is what happened since the end of Feb. '20: (caveat: this is VERY approximate)<br /><br />1) The Fed bought about $2.5 trillion of Treasuries and mortgage-backed securities. These were "paid Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-36472544566526354492021-10-22T11:32:02.364-07:002021-10-22T11:32:02.364-07:00Where are the funds the Fed spent to purchase trea...Where are the funds the Fed spent to purchase treasuries? In reserves? Can the Fed sell treasuries back to banks? <br />What control does Fed have over the M2 funds?DJDhttps://www.blogger.com/profile/01634608128841501265noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-3620942160791685842021-10-22T09:51:56.148-07:002021-10-22T09:51:56.148-07:00I think a bunch of the long-term fundamentals in t...I think a bunch of the long-term fundamentals in the real economy remain under deflationary pressure in developed economies- low birth rates, government intervention/malinvestment causing lower GDP, socio-political/maleducation causing low economic/business IQ in the general population. <br /><br />The shorter/intermediate-term items caused by the pandemic, and on-going financial nonsense by wkevinwhttps://www.blogger.com/profile/17600473578823788550noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-22831726468239762322021-10-22T01:55:36.813-07:002021-10-22T01:55:36.813-07:00Great outlook.
Well, wait and see.
Everywhere ...Great outlook. <br /><br />Well, wait and see. <br /><br />Everywhere you look, capital looking for a home. This seems to be the era of permanent capital gluts. Uncle Sam is a safe home (at least we hope). <br /><br />I won't be surprised if in two years oil prices are lower, even with the Biden Administration. <br /><br />BTW, used Volkswagens went up 30% in price in the last year. You Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.com