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Explaining Why Federal Deficits Are Needed[W:5330]

Kushinator.. it was already explained to you how that is incomplete. Government competes with private industry which crowds out.

Just because you lack the understanding to figure out that when the government say.. decides to build or support building healthcare clinics. that this competes with private interest. Or when it gives a special subsidy to a few large corn growers.. or a myriad of other things.. that this is also crowding out and is not captured by "interest rates".

You got schooled on this before. Heck.. I doubt you even understood that this can happen if I had not brought it up. And provided links of examples of such.

The only one in make believe land is you.. who think that interests rates are the only indicator of crowding out.

Your "logic" abandons the most basic IS/LM analysis. Do explain what occurs when savings increases, or there is a left shift on the IS curve. The length you will now go to wiggle out of your cereal box smart comment will be rather interesting.

:lol:

Edit: so that it cannot be denied

imgD.gif
 
It would cause inflation because it would outstrip the economy's ability to meet demand.

Inflation doesn't just happen to happen.

Nuh uh!!! Inflation happens because of inflation!!!!!!
 
Yes!!!!!!!!!!!!!

Giving the money to people with low or negative savings will ensure it is spent. Giving the money to fund foreign invasions is actually a negative; as it costs both lives and real resources that are not deployed within the country itself.



I understand that if Bill Gates has to pay an extra $50 million in taxes next year, it will have absolutely no impact on what he spends on himself next year.

Why haven't you responded to my point regarding inflation and printing? Do you lack the courage to admit you were wrong?

Spent on what? Spent on necessities which affects other industries and services taking away a lot of choice. This country was built on equal opportunity not equal outcome which is what you and the rest of the left seems to want, taking from the rich to pay for the poor when that does nothing to change personal behavior. Giving people a fish to eat doesn't teach them how to fish. Giving away someone else's money or trying to punish the wealth serves no purpose other than to grow govt. and dependence.

The more money individuals have, the more opportunities they have the less need they have for that massive federal govt. There aren't a lot of Bill Gates out there and certainly not enough to fund the liberal spending appetite but the message is clear today you don't have to work for what you want just expect someone else to give it to you
 
Well, then we must be crowding out less than ever, since the savings rate has been decreasing for decades.




Less money IS being saved.

Actually our savings rate has not been decreasing for decades. and our savings definitely not.

As far as less money is being saved.. Please link to your information. I think your may be using national rate.. and it includes government saving.. which is negative.

But even there.. our rate has gone up and down over the decades.

So not sure what you are seeing.
 
Spent on what? Spent on necessities which affects other industries and services taking away a lot of choice.

Spent on whatever they choose.

I see you wish to ignore my statements and attack imaginary men of straw. If you refuse to respond to my comments, this conversation is over.
 
It would cause inflation because it would outstrip the economy's ability to meet demand.

Inflation doesn't just happen to happen.

Right.. inflation doesn't just happen to happen.

It doesn't just happen when we have outstripped the economies ability to meet demand.

Tell me.. we have inflation right now. Do you contend that we have outstripped the worlds capacity to meet demand?

If not.. then please explain how we have inflation then. Heck.. we haven't even reached max capacity in the US.. (we are about 75%).. much less the worlds.

So please explain how we can have inflation NOW.
 
Right.. inflation doesn't just happen to happen.

It doesn't just happen when we have outstripped the economies ability to meet demand.

Tell me.. we have inflation right now. Do you contend that we have outstripped the worlds capacity to meet demand?

If not.. then please explain how we have inflation then. Heck.. we haven't even reached max capacity in the US.. (we are about 75%).. much less the worlds.

So please explain how we can have inflation NOW.

Again?
 
Your "logic" abandons the most basic IS/LM analysis. Do explain what occurs when savings increases, or there is a left shift on the IS curve. The length you will now go to wiggle out of your cereal box smart comment will be rather interesting.

:lol:

Edit: so that it cannot be denied

imgD.gif

Yawn...already explained why its not valid. because it does not capture all actions in the economy.
 

Okay.. I'll go slow.

We have inflation now.

We are not at max productive capacity.. (in other words we still can meet demand).

How can we have inflation if inflation only occurs when max productive capacity is reached (we have outstripped the economies ability to meet demand)
 
Yawn...already explained why its not valid. because it does not capture all actions in the economy.

Your premise (government spending causes interest rates to decrease) violates basic IS/LM analysis, without you even knowing it . I guess this is what happens when you engage with people who lack the education to discuss a topic in the depth they are attempting to discuss it.

:lol:
 
Okay.. I'll go slow.

We have inflation now.

We are not at max productive capacity.. (in other words we still can meet demand).

How can we have inflation if inflation only occurs when max productive capacity is reached (we have outstripped the economies ability to meet demand)

We are not at maximum capacity in everything, you're right.

There are areas where demand is rising faster than production can keep up, or supply chains get interrupted, or workers go on strike, that cause small amounts of inflation in some sectors of the economy.

Inflation has been so low in recent years as to be nearly non-existent, and in fact, has been in the negative in recent years when energy and food prices are taken into account.

https://www.weforum.org/agenda/2015/05/whats-causing-americas-low-inflation/

" ... The overall CPI is actually slightly lower now than it was a year ago, implying a negative inflation rate. A major reason is the decline in gasoline and other energy prices. The energy component of the CPI fell over the last 12 months by 19%. The so-called “core” CPI, which excludes volatile energy and food prices, rose (though only by 1.8%)."
 
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We are not at maximum capacity in everything, you're right.

There are areas where demand is rising faster than production can keep up, or supply chains get interrupted, or workers go on strike, that cause small amounts of inflation in some sectors of the economy.

Inflation has been so low in recent years as to be nearly non-existent, and in fact, has been in the negative in recent years when energy and food prices are taken into account.

https://www.weforum.org/agenda/2015/05/whats-causing-americas-low-inflation/

" ... The overall CPI is actually slightly lower now than it was a year ago, implying a negative inflation rate. A major reason is the decline in gasoline and other energy prices. The energy component of the CPI fell over the last 12 months by 19%. The so-called “core” CPI, which excludes volatile energy and food prices, rose (though only by 1.8%)."

What continues never to be taken into account is human behavior and their reaction to govt. policies. What has happened today is that we have the left touting the job growth of Obama but ignoring that 6 million of those jobs are part time for economic reasons and we have historically high numbers of discouraged workers all of which affect the economy, inflation, and deficits. Until incentive is provided to change behavior all the charts in the world aren't going to truly reflect what is going on. All the deficit spending in the world isn't going to change that behavior either as the more money given the more money taken and the less change in attitude and behavior
 
We are not at maximum capacity in everything, you're right.

There are areas where demand is rising faster than production can keep up, or supply chains get interrupted, or workers go on strike, that cause small amounts of inflation in some sectors of the economy.

Inflation has been so low in recent years as to be nearly non-existent, and in fact, has been in the negative in recent years when energy and food prices are taken into account.

https://www.weforum.org/agenda/2015/05/whats-causing-americas-low-inflation/

" ... The overall CPI is actually slightly lower now than it was a year ago, implying a negative inflation rate. A major reason is the decline in gasoline and other energy prices. The energy component of the CPI fell over the last 12 months by 19%. The so-called “core” CPI, which excludes volatile energy and food prices, rose (though only by 1.8%)."

Point still stands.. (by the way.. u appear to be using 2015 data)

We still have inflation.. yet we are not even close to maximal capacity.

But if you think its because we have reached maximal capacity in some industries. Please detail exactly the industries that we have met maximal production in the US and world wide..

and its these industries that are maxed out that are causing inflammation.

I think you are going to find out.. that prices will still go up.. even though industries have more capacity.
 
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Point still stands.. (by the way.. u appear to be using 2015 data)

We still have inflation.. yet we are not even close to maximal capacity.

But if you think its because we have reached maximal capacity in some industries. Please detail exactly the industries that we have met maximal production in the US and world wide..
Yes, that's from 2015, but since we're talking about stuff from 2008-2016, I don't expect the historical analysis will change much.

I'll get back to you on those industries with demand sufficient to cause rising prices....

Hold your breath.

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Yes, again. Over and over and over until he gets it, adopts the idea as his own, then claims it was his position from the start.

Please explain to me John how we have inflation.. now.. and have had inflation for decades but have not reached maximal production.
 
Yes, that's from 2015, but since we're talking about stuff from 2008-2016, I don't expect the historical analysis will change much.

I'll get back to you on those industries with demand sufficient to cause rising prices....

Hold your breath.

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No Critter.. I asked for those industries that were maxed out.

According to Johns premise.inflation only occurs when production cannot meet demand.

So you need to provide those industries that have reached maximal capacity and that accounts for prices going up.
 
What continues never to be taken into account is human behavior and their reaction to govt. policies. What has happened today is that we have the left touting the job growth of Obama but ignoring that 6 million of those jobs are part time for economic reasons and we have historically high numbers of discouraged workers all of which affect the economy, inflation, and deficits. Until incentive is provided to change behavior all the charts in the world aren't going to truly reflect what is going on. All the deficit spending in the world isn't going to change that behavior either as the more money given the more money taken and the less change in attitude and behavior

that proves the crookedness of the media.. they help lie to cover up liberalism harm because that is how they make THEIR MONEY
 
No Critter.. I asked for those industries that were maxed out.

According to Johns premise.inflation only occurs when production cannot meet demand.

So you need to provide those industries that have reached maximal capacity and that accounts for prices going up.
Maxed out production is one way demand can be sufficient to cause an increase in prices. I'm not sure why you are making this distinction. It's not any sort of "ah-ha" like you are making it out to be.

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Please explain to me John how we have inflation.. now.. and have had inflation for decades but have not reached maximal production.

We have explained this ad nauseum. Are you just going back to this so you don't have to answer my post #1124? The one where you were going to tell me all about how savings actually worked? Or about all of those other avenues of demand injections, like innovation? I'm eager to learn.
 
No Critter.. I asked for those industries that were maxed out.

According to Johns premise.inflation only occurs when production cannot meet demand.

Nope. Wrong again. That's hyperinflation. Run-of-the-mill inflation happens for a lot of reasons, mostly leverage. If you can raise your price, and make more money doing so, you will.
 
Maxed out production is one way demand can be sufficient to cause an increase in prices. I'm not sure why you are making this distinction. It's not any sort of "ah-ha" like you are making it out to be.

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Sure its one way. Of course we have had inflation as a nation for a long time.. decades.. and yet have rarely even approached max production.. much less hit it.

So Johns premise.. that we can only have inflation when we reach maximal production (unable to meet demand).. is false.
 
Nope. Wrong again. That's hyperinflation. Run-of-the-mill inflation happens for a lot of reasons, mostly leverage. If you can raise your price, and make more money doing so, you will.

Sure..which means that your premise that we only have to worry about creating inflation when we outstrip capacity is incorrect..
 
We have explained this ad nauseum. Are you just going back to this so you don't have to answer my post #1124? The one where you were going to tell me all about how savings actually worked? Or about all of those other avenues of demand injections, like innovation? I'm eager to learn.

great.

Explain the mechanisms that allow and encourage us as a nation to net save.
 
Sure..which means that your premise that we only have to worry about creating inflation when we outstrip capacity is incorrect..

No, it means that you continually conflate hyperinflation with normal inflation. And I'm generally not worried about normal inflation. A little is a good thing.
 
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