Page 58 of 63 FirstFirst ... 8485657585960 ... LastLast
Results 571 to 580 of 628

Thread: LA Times: Obama stimulus spending: $246,436 per new job

  1. #571
    Traditionalist
    phattonez's Avatar
    Join Date
    Jun 2009
    Location
    Los Angeles, CA
    Last Seen
    12-05-17 @ 03:45 PM
    Gender
    Lean
    Other
    Posts
    20,072

    Re: LA Times: Obama stimulus spending: $246,436 per new job

    Quote Originally Posted by drz-400 View Post
    I am not so sure. It would seem to me it would just make faster losses. Not necesarily a faster correction.
    If you're making money you can still get loans right? But if you're not, then loans will be harder to come by. These loans would otherwise keep these companies afloat but now they will just fail faster if they can't get credit. This will help shift production toward what people are really demanding.

    Who shall ascend the hill of the Lord? And who shall stand in his holy place? He who has clean hands and a pure heart, who does not lift up his soul to what is false, and does not swear deceitfully. Psalm 24
    "True law is right reason in agreement with nature . . . Whoever is disobedient is fleeing from himself and denying his human nature [and] will suffer the worst penalties . . ." - Cicero

  2. #572
    I'm not-low all the time
    Kushinator's Avatar
    Join Date
    Jan 2006
    Location
    West Loop
    Last Seen
    Yesterday @ 11:41 PM
    Gender
    Lean
    Independent
    Posts
    16,251

    Re: LA Times: Obama stimulus spending: $246,436 per new job

    Quote Originally Posted by drz-400 View Post
    For the big picture I would agree with you. However, since obvouisly the entire economy has never been completely dismantled by a deflationary spiral, I am guessing something must break the chain. Possibly it is because not literally everything sees a drop in demand, despite a drop in AD. When looking at the macro level you need to be wary of the fallicy of composition, but also the fallacy of division.
    Regardless of recessions/depressed economic sentiment, there are aspects of our lives that are essential. Health care, waste disposal, death expenses, etc... are quite inelastic, meaning price volatility will have minimal response in regards to quantity demanded.

    Other aspects such as food, entertainment, transportation, etc... will be hit harder. Suffice to say, discretionary spending falls when income uncertainty arises.

    Of course, we could tie this together in a much neater package by referring to cross price elasticity of demand, but i am not sure talking economics will go over very well
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    "Wealth of Nations," Book V, Chapter II, Part II, Article I, pg.911

  3. #573
    I'm not-low all the time
    Kushinator's Avatar
    Join Date
    Jan 2006
    Location
    West Loop
    Last Seen
    Yesterday @ 11:41 PM
    Gender
    Lean
    Independent
    Posts
    16,251

    Re: LA Times: Obama stimulus spending: $246,436 per new job

    Quote Originally Posted by phattonez View Post
    There are still companies making money out there though. When credit is hard to come by, they will get the loans while the companies that aren't will have a much harder time of it. This speeds up the loss function, which is essential for an economy. The faster the losses the faster the correction.
    My issue is in the bold. Volatility has to be considered, and faster losses leads to the unleashing of animal spirits. Psychology and heuristics then render market actions inefficient as panic (quite the contagious ****) begins to spread.

    I've gone over this with you. 17x some arbitrary level means nothing. If the reserve ratio gets to 100% and there's still no lending then there may be a problem with what I'm saying.
    This is just a misunderstanding of basic finance. High levels of reserves is essentially a major symptom of a liquidity trap. BTW: 17x equates reserve ratio's at 170%
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    "Wealth of Nations," Book V, Chapter II, Part II, Article I, pg.911

  4. #574
    Traditionalist
    phattonez's Avatar
    Join Date
    Jun 2009
    Location
    Los Angeles, CA
    Last Seen
    12-05-17 @ 03:45 PM
    Gender
    Lean
    Other
    Posts
    20,072

    Re: LA Times: Obama stimulus spending: $246,436 per new job

    Quote Originally Posted by Goldenboy219 View Post
    My issue is in the bold. Volatility has to be considered, and faster losses leads to the unleashing of animal spirits. Psychology and heuristics then render market actions inefficient as panic (quite the contagious ****) begins to spread.
    Not everything fails though. You know this.

    This is just a misunderstanding of basic finance. High levels of reserves is essentially a major symptom of a liquidity trap. BTW: 17x equates reserve ratio's at 170%
    Of what is legally required.

    Who shall ascend the hill of the Lord? And who shall stand in his holy place? He who has clean hands and a pure heart, who does not lift up his soul to what is false, and does not swear deceitfully. Psalm 24
    "True law is right reason in agreement with nature . . . Whoever is disobedient is fleeing from himself and denying his human nature [and] will suffer the worst penalties . . ." - Cicero

  5. #575
    I'm not-low all the time
    Kushinator's Avatar
    Join Date
    Jan 2006
    Location
    West Loop
    Last Seen
    Yesterday @ 11:41 PM
    Gender
    Lean
    Independent
    Posts
    16,251

    Re: LA Times: Obama stimulus spending: $246,436 per new job

    Quote Originally Posted by phattonez View Post
    If you're making money you can still get loans right? But if you're not, then loans will be harder to come by. These loans would otherwise keep these companies afloat but now they will just fail faster if they can't get credit. This will help shift production toward what people are really demanding.
    And to think that you might not want to talk economics To my surprise (even though you are probably unaware), cross price elasticity arises! Must be a good time for bankruptcy attorneys; as demand has clearly shifted in their favor.
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    "Wealth of Nations," Book V, Chapter II, Part II, Article I, pg.911

  6. #576
    I'm not-low all the time
    Kushinator's Avatar
    Join Date
    Jan 2006
    Location
    West Loop
    Last Seen
    Yesterday @ 11:41 PM
    Gender
    Lean
    Independent
    Posts
    16,251

    Re: LA Times: Obama stimulus spending: $246,436 per new job

    Quote Originally Posted by phattonez View Post
    Not everything fails though. You know this.
    Then why bring it up? The point was that panic leads to far more inefficient outcomes than anything you have offered up to this point.

    Of what is legally required.
    Better read up on fractional reserve banking and what reserve ratios mean!
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    "Wealth of Nations," Book V, Chapter II, Part II, Article I, pg.911

  7. #577
    Traditionalist
    phattonez's Avatar
    Join Date
    Jun 2009
    Location
    Los Angeles, CA
    Last Seen
    12-05-17 @ 03:45 PM
    Gender
    Lean
    Other
    Posts
    20,072

    Re: LA Times: Obama stimulus spending: $246,436 per new job

    Quote Originally Posted by Goldenboy219 View Post
    Then why bring it up? The point was that panic leads to far more inefficient outcomes than anything you have offered up to this point.
    How is it inefficient? The best succeed and the worst fail. That's capitalism.

    Better read up on fractional reserve banking and what reserve ratios mean!
    A 170% reserve ratio means that if everyone demands their savings right now that the bank will still have some extra money for themselves. You know that's not the case. It's 170% of the required reserves.

    Who shall ascend the hill of the Lord? And who shall stand in his holy place? He who has clean hands and a pure heart, who does not lift up his soul to what is false, and does not swear deceitfully. Psalm 24
    "True law is right reason in agreement with nature . . . Whoever is disobedient is fleeing from himself and denying his human nature [and] will suffer the worst penalties . . ." - Cicero

  8. #578
    Traditionalist
    phattonez's Avatar
    Join Date
    Jun 2009
    Location
    Los Angeles, CA
    Last Seen
    12-05-17 @ 03:45 PM
    Gender
    Lean
    Other
    Posts
    20,072

    Re: LA Times: Obama stimulus spending: $246,436 per new job

    Quote Originally Posted by Goldenboy219 View Post
    And to think that you might not want to talk economics To my surprise (even though you are probably unaware), cross price elasticity arises! Must be a good time for bankruptcy attorneys; as demand has clearly shifted in their favor.
    Sure has, but so what? Everyone knows that won't last.

    Who shall ascend the hill of the Lord? And who shall stand in his holy place? He who has clean hands and a pure heart, who does not lift up his soul to what is false, and does not swear deceitfully. Psalm 24
    "True law is right reason in agreement with nature . . . Whoever is disobedient is fleeing from himself and denying his human nature [and] will suffer the worst penalties . . ." - Cicero

  9. #579
    Sage
    misterman's Avatar
    Join Date
    Nov 2009
    Last Seen
    02-09-12 @ 08:41 AM
    Lean
    Undisclosed
    Posts
    12,913

    Re: LA Times: Obama stimulus spending: $246,436 per new job

    Quote Originally Posted by phattonez View Post
    How is it inefficient? The best succeed and the worst fail. That's capitalism.
    Doesn't mean it's not inefficient. We can have a more efficient version of capitalism.

  10. #580
    I'm not-low all the time
    Kushinator's Avatar
    Join Date
    Jan 2006
    Location
    West Loop
    Last Seen
    Yesterday @ 11:41 PM
    Gender
    Lean
    Independent
    Posts
    16,251

    Re: LA Times: Obama stimulus spending: $246,436 per new job

    Quote Originally Posted by phattonez View Post
    How is it inefficient? The best succeed and the worst fail. That's capitalism.
    Efficiency of market systems depends on competition to weed out the weak. Financial panics lead to heuristic herd behavior, which is neither efficient nor logical, hence the term animal spirits. The difference between a correction and a meltdown essentially depends on the level of market participants who are driven on fear. We know that the upward trend of asset values is very much real.

    A 170% reserve ratio means that if everyone demands their savings right now that the bank will still have some extra money for themselves. You know that's not the case. It's 170% of the required reserves.
    17 x the required reserve ratio does not equate to 170%. Given the current required reserve ratio being fractionally equivalent to 1/10: 1/10 x 17/1 = 17/10 which is 170%. 17x's = 1700% FWIW....
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    "Wealth of Nations," Book V, Chapter II, Part II, Article I, pg.911

Page 58 of 63 FirstFirst ... 8485657585960 ... LastLast

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •