tag:blogger.com,1999:blog-6616959642391988608.post8911755556069506886..comments2024-03-28T00:18:25.641-07:00Comments on Calafia Beach Pundit: Booming pricesScott Grannishttp://www.blogger.com/profile/14028519647946868684noreply@blogger.comBlogger28125tag:blogger.com,1999:blog-6616959642391988608.post-69136515601535823112021-04-14T07:17:06.908-07:002021-04-14T07:17:06.908-07:00"Japan sidestepped the entire Great Depressio..."Japan sidestepped the entire Great Depression through MMT policies..."<br />i don't think this is correct.<br /><br />There were many factors involved, including abandoning the gold standard (currency devaluation) and 'investments' in productive purposes (productive public works, productive industrial policy and 'productive' investments in the military {productive Carlhttps://www.blogger.com/profile/01792779708580094262noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-44461550437946061132021-04-13T23:04:07.725-07:002021-04-13T23:04:07.725-07:00Unfortunately, in the US, MMT gets conflated with ...Unfortunately, in the US, MMT gets conflated with social liberal programs. In fact, Japan sidestepped the entire Great Depression through MMT policies but unfortunately they spent their money on military buildup and occupations.<br /><br />My favorite way to stimulate the economy is to cut taxes.<br /><br />By the way, some very strict and rigorous Libertarians actually call for the Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-38301630000354802032021-04-13T11:12:39.029-07:002021-04-13T11:12:39.029-07:00"There now is no constraint on spending relat..."There now is no constraint on spending related to deficit concerns. "<br /><br />I see the same thing. In fact, I can't figure out the rationale for tax increases at all. Is there even a rationale for taxes any more?<br /><br />In any case, this time isn't different and it will end in tears. No, you can't drop endless cataracts of money from helicopters here any more than K T Cathttps://www.blogger.com/profile/10259428595745509790noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-89344900810274678802021-04-13T09:53:38.561-07:002021-04-13T09:53:38.561-07:00Unknown:
"The other day, Dr. Kelton's ...Unknown: <br /><br />"The other day, Dr. Kelton's argument about MMT was that it was already here and i think she has a point. i used to think of MMT as a clear threshold but have come to appreciate how gradual the process can be."<br /><br />That seems 100% correct. There now is no constraint on spending related to deficit concerns. GOP has no credibility in this regard to be randyhttps://www.blogger.com/profile/16368254229927808998noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-62829377621590466662021-04-13T08:08:02.925-07:002021-04-13T08:08:02.925-07:00re: "Endogenous money creation from the moder...re: "Endogenous money creation from the modern fractional banking era has been an amazing proposition, with inevitable booms and busts along the way"<br /><br />Lending/investing by the Reserve and commercial banks is inflationary, whereas lending/investing by the nonbanks is noninflationary. Disintermediation is made in Washington.Salmo Truttahttps://www.blogger.com/profile/13910212017849902362noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-87865369158669298082021-04-13T04:44:18.974-07:002021-04-13T04:44:18.974-07:00Mr. Cole:
i've been mostly a surgeon in real l...Mr. Cole:<br />i've been mostly a surgeon in real life and thank you for this 'macro' discussion.<br />Endogenous money creation from the modern fractional banking era has been an amazing proposition, with inevitable booms and busts along the way. The government though has also become a major money creator through the issuance of debt (double entry accounting of bond and cash in the Carlhttps://www.blogger.com/profile/01792779708580094262noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-55595853613608882992021-04-12T19:57:19.887-07:002021-04-12T19:57:19.887-07:00Unknown:
I am beginning to think the right respon...Unknown:<br /><br />I am beginning to think the right response is mostly fiscal, mostly money-financed fiscal programs (aka helicopter drops) and mostly executed through tax cuts, not more spending.<br /><br />As in, a holiday on Social Security taxes, offset by the Fed buying Treasuries and stuffing them into the SS trust fund. <br /><br />Right now, the Fed wants commercial banks to lend more, Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-39703379011428889352021-04-11T20:53:09.046-07:002021-04-11T20:53:09.046-07:00Mr. Cole:
Fair enough.
What we are finding out is ...Mr. Cole:<br />Fair enough.<br />What we are finding out is the fiscal space available. How can you know you've gone too far if you haven't gone too far? This question was irrelevant at the time the 1913 Federal Reserve Act was enacted. We may eventually find out and then macro experts will explain how obvious it was all along. :)Carlhttps://www.blogger.com/profile/01792779708580094262noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-64658519686600203572021-04-11T16:57:22.916-07:002021-04-11T16:57:22.916-07:00Unknown:
The world is enduring a pandemic (and a ...Unknown:<br /><br />The world is enduring a pandemic (and a very restrictive government response) yet the economy is doing okay. We did not sink into a global Great Depression.<br /><br />One viewpoint might be that central banks and fiscal authorities finally get it.<br /><br />Wide-scale liquidations could have had a Snowball Effect---all downhill.<br /><br />My reservation is that debt peonageBenjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-12398312742361892772021-04-11T06:16:09.897-07:002021-04-11T06:16:09.897-07:00@Benjamin Cole
"Well, who knows. If you belie...@Benjamin Cole<br />"Well, who knows. If you believe the market, 2021-2 is setting up for solid growth and low inflation, and not much in the way of bond defaults."<br />An interesting thought is that, for the typical "saver", in order to obtain similar yields offered by CDs about 10 to 15 years ago, one has to invest in high-yield (junk) bonds now.<br />Whatever thoughts on Carlhttps://www.blogger.com/profile/01792779708580094262noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-18104325827078209022021-04-11T00:34:02.052-07:002021-04-11T00:34:02.052-07:00More talk from John Lonki at Moody's:
"M...More talk from John Lonki at Moody's:<br /><br />"Market-Based Metrics of Default Risk Are the Lowest since 2007<br /><br />The market’s assessment of high-yield default risk now resides at its lowest level since the early summer of 2007. As mentioned earlier, the Bloomberg/Barclays high-yield bond spread trails each of its prior month-long averages going back to June 2007. In addition, Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-80855339060547909842021-04-10T06:47:21.498-07:002021-04-10T06:47:21.498-07:00@HDX
To focus on perceived ideological differences...@HDX<br />To focus on perceived ideological differences is not constructive.<br />It's interesting that you initiate the discussion from a country (compared to Canada) that is now promoting the Green New Deal, the equivalent of UBI etc etc and that spent, by far, the largest amount of funds (all government debt) per GDP for Covid-19 side effects, a virus that people recover from more than 99%Carlhttps://www.blogger.com/profile/01792779708580094262noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-6602958585472024012021-04-09T17:04:56.948-07:002021-04-09T17:04:56.948-07:00Unknown Canadian -
For your information, even a bl...Unknown Canadian -<br />For your information, even a blonde bimbo knew she had to go to the USA to make money. She is depleting that savings now, I guess in Canada but doesn't matter where she spends the money, she earned it in the USA not Canada.<br /><br />Thanks for noticing that the topic Scott wrote about is inflation. Since you are Canadian, I'll try to explain this in hockey, in HDXhttps://www.blogger.com/profile/01769249455015381260noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-81108020292772017482021-04-09T16:12:31.292-07:002021-04-09T16:12:31.292-07:00@HDX
You are quite funny.
Yes, Canada is dependent...@HDX<br />You are quite funny.<br />Yes, Canada is dependent on the US but it's not as if you don't have your own challenges!<br />For your information, Pamela Anderson (a productive Canadian LOL!) has moved back to Canada and wants to feed prisoners with vegan food.<br />Disclosure: i'm long CoreCivic.<br />BTW the topîc is inflation and money supply.Carlhttps://www.blogger.com/profile/01792779708580094262noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-86239049245242052692021-04-09T14:08:02.469-07:002021-04-09T14:08:02.469-07:00Unknown Canadian -- did you see the Bloomberg arti...Unknown Canadian -- did you see the Bloomberg article (which cited a Canadian source) that 53% of Canadian citizens are now technically <b>insolvent</b>? Over 60% of Canadian citizenry cannot afford a sudden CAD$ 200 expense?<br /><br />The Canadian government wasn't mentioned, but it isn't solvent either (and will soon be less so, given its failed tax base!).<br /><br />The most HDXhttps://www.blogger.com/profile/01769249455015381260noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-74626044480209448012021-04-09T07:37:43.565-07:002021-04-09T07:37:43.565-07:00Parse date; real-output; inflation
2/1/2020 ,,,,,...Parse date; real-output; inflation<br /><br />2/1/2020 ,,,,, 0.05 ,,,,, 0.03<br />3/1/2020 ,,,,, 0.2 ,,,,, 0.21<br />4/1/2020 ,,,,, 0.33 ,,,,, 0.4<br />5/1/2020 ,,,,, 0.4 ,,,,, 0.45<br />6/1/2020 ,,,,, 0.44 ,,,,, 0.5<br />7/1/2020 ,,,,, 0.44 ,,,,, 0.53<br />8/1/2020 ,,,,, 0.45 ,,,,, 0.56<br />9/1/2020 ,,,,, 0.45 ,,,,, 0.61<br />10/1/2020 ,,,,, 0.53 ,,,,, 0.68<br />11/1/2020 ,,,,, 0.77 ,,,,, 0.79<Salmo Truttahttps://www.blogger.com/profile/13910212017849902362noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-20191915784314351752021-04-09T07:29:30.492-07:002021-04-09T07:29:30.492-07:00In 1987 the FED discontinued targeting the money s...In 1987 the FED discontinued targeting the money stock. This caused a lot more volatility.<br /><br />The only tool at the disposal of the monetary authority in a free capitalistic system through which the volume of money can be properly controlled is legal reserves (which have been discontinued March 26, 2020).Salmo Truttahttps://www.blogger.com/profile/13910212017849902362noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-84064261108612689962021-04-09T04:40:50.420-07:002021-04-09T04:40:50.420-07:00The net inflation number that is being reported ha...The net inflation number that is being reported has become the net result of diverging trends: many categories (healthcare, education, child care etc) going up way above average rates for decades now and this has been balanced by other categories with much lower inflation rates, some even deflating (various consumer products) and this has been going on for decades too.<br />The former category isCarlhttps://www.blogger.com/profile/01792779708580094262noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-40556755598783080142021-04-08T18:23:02.462-07:002021-04-08T18:23:02.462-07:00Arguing with academics (see above comments) is a p...Arguing with academics (see above comments) is a pointless activity. They see the world through their little models and theories, and they are convinced that its reality that is wrong, not their models.<br /><br />Holden Caulfield, each and every one of them.<br /><br />For those living in the real world, college tuition has climbed double digits for decades, despite the academics love of CPI.HDXhttps://www.blogger.com/profile/01769249455015381260noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-66188658492697117052021-04-08T07:07:43.639-07:002021-04-08T07:07:43.639-07:00Scott, Yes I agree the growth of M2 is something t...Scott, Yes I agree the growth of M2 is something to watch but is that the most accurate and predictive of inflation "money" growth. I'm not sure the correlation is there. As for Copper, I don't think that US policy is the culprit here, I think that is putting too much responsibility on the US as to the price of commodities. <br /><br />What companies have learned during the Frozen in the Northhttps://www.blogger.com/profile/04901959687094626879noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-84233242155585500702021-04-07T12:55:44.536-07:002021-04-07T12:55:44.536-07:00Inflation will happen similar to what happened in ...Inflation will happen similar to what happened in the 1970's. The question is where to park wealth in the mean time...McKibbinUSAhttps://www.blogger.com/profile/10545798495680527622noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-790067137385410062021-04-07T04:54:49.007-07:002021-04-07T04:54:49.007-07:00"The vast majority of the outsized increase i..."The vast majority of the outsized increase in M2 can be found in bank savings and deposit accounts at the retail level. The public, in other words, has been hoarding money like never before, likely as a response to all the uncertainties raised by the Covid crisis. I calculate that M2 currently is about $2.3 trillion above its long-term growth trend. That's an extra 12% increase in the Carlhttps://www.blogger.com/profile/01792779708580094262noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-73772062819995255922021-04-07T04:38:30.038-07:002021-04-07T04:38:30.038-07:00Benjamin - "Maybe we will see inflation"...Benjamin - "Maybe we will see inflation" - it sure seems to be happening right now in the real estate market and the SP500. Yeah, I know, those don't count towards the official numbers, but those price increases aren't phantasms and eventually that money is going to go somewhere else.K T Cathttps://www.blogger.com/profile/10259428595745509790noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-8358461611828424782021-04-06T19:20:04.510-07:002021-04-06T19:20:04.510-07:00Scott Grannis:
Actually, I erred; it was Moody...Scott Grannis:<br /><br />Actually, I erred; it was Moody's John Lonski who recently penned the thought that wage growth, in aggregate, is too feeble to set off or sustain inflation. <br /><br />Here is what Lonski wrote: <br /><br />"Recurring Climb by Price Inflation Requires Recurring Acceleration by Employment Income<br /><br />Apparently, few currently worry about a recurring climb Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-28244668307140688272021-04-06T17:00:05.783-07:002021-04-06T17:00:05.783-07:00I bought a 2021 vehicle back in October after visi...I bought a 2021 vehicle back in October after visiting numerous dealers... <br /><br />The inventory of new vehicles was generally low and dealers told me that production and shipments were down compared to typical years. So, while new vehicle sales may have been near normal, it was not a typical environment.<br /><br />I will speculate that the reason why used car prices jumped so much is that Andrewhttps://www.blogger.com/profile/01390035459036380103noreply@blogger.com