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The Greek teachers are striking right when its Uni exam time. Because they have been asked to work an extra 2 hours per week.

I don't blame them. Who would put up with being asked to double the hours you work each week? w00t.gif

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I am missing something in this discussion, regarding the US.

I want to be very careful not to sound like a US cheerleader. I'm very concerned about US fiscal policies.

BUT there is one thing which could explain why the stock market could correctly go up while at the same time US consumers lose buying power.

That one thing is international trade. Even if you hate the US, it would be dishonest to not agree that many of the innovations which are driving the world economy came from the US. Many US corporations are making a fortune on that.

Might I mention Google as an example? How about the internet and the backbone that drives it, and MSN and Yahoo and Ebay and Amazon and Skype and...

Then there is software. We can't write or see many websites without Java. Microsoft? Photoshop? Pagemaker?

So many US corporations are making money worldwide, in other countries that I can't even quantify it.

There is hardware like CNC machines and 3D printers. There is Caterpillar and John Deere with their industrial divisions. Yes sales are down some but they are huge globally.

Walmart has about 1/2 of its stores located outside the US with room to grow. How about McDonalds and Burger King and KFC? They certainly aren't limiting themselves to the US consumer.

Boeing just sold another huge order of aircraft to overseas customers.

Much of the world's military units buy and use US designed and built hardware. India is the biggest customer for that. What does a fully equipped fighter jet cost these days?

Hate it, love it, or be neutral, it would surprise me if someone couldn't see that much of the US corporations, and therefore their values, have grown from overseas sales and growth, not from selling to the US consumer.

I think global revenues have buoyed the US exchanges, yes. But now the $USD is breaking out. I think that may affect profits in a qtr or two.

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I am missing something in this discussion, regarding the US.

I want to be very careful not to sound like a US cheerleader. I'm very concerned about US fiscal policies.

BUT there is one thing which could explain why the stock market could correctly go up while at the same time US consumers lose buying power.

That one thing is international trade. Even if you hate the US, it would be dishonest to not agree that many of the innovations which are driving the world economy came from the US. Many US corporations are making a fortune on that.

Might I mention Google as an example? How about the internet and the backbone that drives it, and MSN and Yahoo and Ebay and Amazon and Skype and...

Then there is software. We can't write or see many websites without Java. Microsoft? Photoshop? Pagemaker?

So many US corporations are making money worldwide, in other countries that I can't even quantify it.

There is hardware like CNC machines and 3D printers. There is Caterpillar and John Deere with their industrial divisions. Yes sales are down some but they are huge globally.

Walmart has about 1/2 of its stores located outside the US with room to grow. How about McDonalds and Burger King and KFC? They certainly aren't limiting themselves to the US consumer.

Boeing just sold another huge order of aircraft to overseas customers.

Much of the world's military units buy and use US designed and built hardware. India is the biggest customer for that. What does a fully equipped fighter jet cost these days?

Hate it, love it, or be neutral, it would surprise me if someone couldn't see that much of the US corporations, and therefore their values, have grown from overseas sales and growth, not from selling to the US consumer.

I think global revenues have buoyed the US exchanges, yes. But now the $USD is breaking out. I think that may affect profits in a qtr or two.

You may be right. I can't look at just a few weeks or even a quarter or two. If the USD breaks out too much, the fed will drive it down.

My concern is global and the debt and deficits of the leading nations. Europe isn't doing well. The Eurozone is in a world of hurts. All of these people are customers of Asia. Even China would go down if the West stopped buying its products and right now sales are down for them. We must never forget that China is communist and the government owns the means of production. If the means of production falter, so does the government.

The US is doing a bit better on the surface, but under the surface is a mountain of debt. The private sector is doing OK but the governments (federal, state, local) are busy driving deficits and debt. The governments don't produce any wealth; they consume wealth that must first be created in the private sector. Leaders seem to have forgotten that, or maybe they never knew it. They think that government spending can stimulate without answering the question "how will we ever pay for this?"

I don't know how the world ever came to believe that government spending could stimulate. Short term maybe, but the only long term stimulus is for the private sector to flourish, creating jobs and new wealth by producing goods and services of value, and then paying reasonable taxes on that. Current governments have it backwards. They think the government is the engine, and that they should tax and spend and even borrow. Government was never the engine. It was always the weight that the engine of commerce had to pull along.

I don't know where we're going. If my country, the US, is the safest place on earth to park money, we are all in trouble.

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NEWSFLASH

As pointed out on this forum a few weeks ago.....namely that the deficit was already down from $1.2T to $800 and something billion, Cheeryble is pleased to point out that the suggestion at that time....that higher revenue would reduce the deficit further......has now happened.

The new deficit is running at $642B.

If I remember my own post correctly it was said that if the deficit went down to $400+B it was sustainable. (Obviously as an economist of 0 years experience I was running on other people's figures)

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NEWSFLASH

As pointed out on this forum a few weeks ago.....namely that the deficit was already down from $1.2T to $800 and something billion, Cheeryble is pleased to point out that the suggestion at that time....that higher revenue would reduce the deficit further......has now happened.

The new deficit is running at $642B.

If I remember my own post correctly it was said that if the deficit went down to $400+B it was sustainable. (Obviously as an economist of 0 years experience I was running on other people's figures)

Who's deficits, and what do the $ signs mean? What kind of dollars? What country are you discussing?

If you're talking about the US, the numbers are bogus as they are in most countries. "Figures don't lie, but liars figure."

Let's just discuss the disaster called Social Security. About 40 years ago the feds decided to take SS off the books as a debt. They then began to spend the income from payroll taxes in the general budget. They then made IOU's to the SS fund. But they also made a law that the debt to SS is not sovereign debt backed by the full faith of the government. They were supposed to be saving that money for the people who were paying it for their retirements.

So when we say that the US has 16 tril of debt or whatever, that doesn't include the money "owed" to those who paid into SS all of these years. And that amount of money is greater than the 16 tril. There is also no way in the world that future revenues for SS will be enough to pay for the now retiring baby boomers. Everyone knows there is a big bubble in the population known as the baby boomers. They are the children born for a couple of decades after WWII when the soldiers came home and the country had prosperity. The generations behind them are much smaller, but they are stuck actually paying for the SS of the boomers. The boomers' money has been blown in the general budget.

Of course having money that's borrowed off the books pouring into the general budget can make it appear that the budget balances, or at most that the deficit isn't bad. But they aren't accounting for the portion of their income that's called FICA which is borrowed. In the next ten years this is going to catch up with them because the first of the baby boomers just reached retirement age and are beginning to collect benefits. Those boomers will then also stop working and paying into the system.

Another loss is the knowledge and innovation of the boomers. First they were the hippies, and then they were the corporate leaders. They invented the personal computer and the internet, the cell phone and the software. They started the modern information age. They did things like start Ebay and Yahoo and many of today's large corporations which weren't heard of or needed before. I'll just mention Microsoft and, well, all of Silicon Valley.

Now they are dropping out, leaving it all to the next generation which got a lousy education from the deteriorating education system, and a poor work ethic from being spoiled in America.

We'll see just how much these "deficits" really are when we figure out how much the Fed is really printing to pay all of these bills.

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I don't know how the world ever came to believe that government spending could stimulate.

How about John Maynard Keynes...who, if alive, would urge Congress to ease off that austerity brake for awhile longer -- and to ponder the lessons of how too much, too soon austerity in Europe has backfired.

But, yeah, for sure we need to eventually bring deficits down to manageable levels -- but for now, timing is everything.

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SS in US and NHS etc pensions in UK and EU; its all totally unsustainable as it is and will get worse over next decades

"""Lamb said that the NHS is under huge pressure from an ageing population, with the number of elderly patients suffering chronic and complex health problems growing and that tackling it would be the challenge of the 21st century.

Accident and Emergency [A&E] units are under pressure, ambulances are carrying more patients than they should, significant numbers of people are in hospital who should be cared for elsewhere. The system is becoming dysfunctional and we need to do something about it, Lamb told the Telegraph.

While one of Britains most senior A&E doctors, Dr. Cliff Mann, from the College of Emergency Medicine, said that they had begun to feel like war zones, and that many doctors were turning their backs on emergency medicine."""""

-rt

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I don't know how the world ever came to believe that government spending could stimulate.

How about John Maynard Keynes...who, if alive, would urge Congress to ease off that austerity brake for awhile longer -- and to ponder the lessons of how too much, too soon austerity in Europe has backfired.

But, yeah, for sure we need to eventually bring deficits down to manageable levels -- but for now, timing is everything.

See below. What good does it do to create a temporary illusion of something, when the reality is bankruptcy?

Keynes was not only an idiot, but we're looking down the barrel of the disaster caused by those who believed him.

SS in US and NHS etc pensions in UK and EU; its all totally unsustainable as it is and will get worse over next decades

"""Lamb said that the NHS is under huge pressure from an ageing population, with the number of elderly patients suffering chronic and complex health problems growing and that tackling it would be the challenge of the 21st century.

Accident and Emergency [A&E] units are under pressure, ambulances are carrying more patients than they should, significant numbers of people are in hospital who should be cared for elsewhere. The system is becoming dysfunctional and we need to do something about it, Lamb told the Telegraph.

While one of Britains most senior A&E doctors, Dr. Cliff Mann, from the College of Emergency Medicine, said that they had begun to feel like war zones, and that many doctors were turning their backs on emergency medicine."""""

-rt

It is unsustainable. It was an illusion. No country has ever survived socialism or communism in a good way. The USSR had to disband and Russia now laughs at the West for adopting socialism instead of capitalism. China has had to turn part of its society to capitalism, that hated word in their communism. Others like Cuba drift along in poverty. Greece hasn't hit bottom, but they are the poster child for looking to the government for everything.

I have no comeback for the Europeans who mock the US for not having national health care. Theirs will collapse leaving them with no health care. They limp along with no real industry, and not much military expense and now are mostly manufacturing for other countries. Prices are sky high to cover the taxes for what their government is trying hopelessly to do.

And the US is insisting in following along.

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I don't know how the world ever came to believe that government spending could stimulate.

How about John Maynard Keynes...who, if alive, would urge Congress to ease off that austerity brake for awhile longer -- and to ponder the lessons of how too much, too soon austerity in Europe has backfired.

But, yeah, for sure we need to eventually bring deficits down to manageable levels -- but for now, timing is everything.

See below. What good does it do to create a temporary illusion of something, when the reality is bankruptcy?

Keynes was not only an idiot, but we're looking down the barrel of the disaster caused by those who believed him.

>SS in US and NHS etc pensions in UK and EU; its all totally unsustainable as it is and will get worse over next decades

"""Lamb said that the NHS is under huge pressure from an ageing population, with the number of elderly patients suffering chronic and complex health problems growing and that tackling it would be the challenge of the 21st century.

Accident and Emergency [A&E] units are under pressure, ambulances are carrying more patients than they should, significant numbers of people are in hospital who should be cared for elsewhere. The system is becoming dysfunctional and we need to do something about it, Lamb told the Telegraph.

While one of Britains most senior A&E doctors, Dr. Cliff Mann, from the College of Emergency Medicine, said that they had begun to feel like war zones, and that many doctors were turning their backs on emergency medicine."""""

-rt

It is unsustainable. It was an illusion. No country has ever survived socialism or communism in a good way. The USSR had to disband and Russia now laughs at the West for adopting socialism instead of capitalism. China has had to turn part of its society to capitalism, that hated word in their communism. Others like Cuba drift along in poverty. Greece hasn't hit bottom, but they are the poster child for looking to the government for everything.

I have no comeback for the Europeans who mock the US for not having national health care. Theirs will collapse leaving them with no health care. They limp along with no real industry, and not much military expense and now are mostly manufacturing for other countries. Prices are sky high to cover the taxes for what their government is trying hopelessly to do.

And the US is insisting in following along.

IMO Keynes was actually a pretty good economist. I don't think he saw government spending as stimulative per se, given its low fiscal multiplier, so much as smoothing out the sharpness of a downturn. What almost everyone fails to cite with respect to Keynes is, the thing that makes the government spending work is building reserves in times of economic strength. Most people only follow the spending part and not the saving part of his theories.

Edited by lannarebirth
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IMO Keynes was actually a pretty good economist. I don't think he saw government spending as stimulative per se, given its low fiscal multiplier, so much as smoothing out the sharpness of a downturn. What almost everyone fails to cite with respect to Keynes is, the thing that makes the government spending work is building reserves in times of economic strength. Most people only follow the spending part and not the saving part of his theories.

If it's a low fiscal multiplier, how can it be a good use of money at any time?

The way to stimulate an economy is to have minimal government pulling a minimal amount of capital out of the private sector, and let capital grow for creating new wealth.

Again, government is never a creator of wealth. It is always a net consumer of wealth. Unlike private industry, government is also wasteful, spilling about 1/2 of the money it collects in bureaucracy and other unnecessary spending. It has no need to show a profit so it has no one to answer to.

If it needs more money, it just says it needs to raise taxes. If it was a private company and doing that, the stockholders would revolt. But since it's always "someone else's money," then people just line up at the trough.

Keynes had it wrong because the government should never have taxed enough to build up a surplus except for its own use to pay government bills during a time of low tax income.

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I don't know how the world ever came to believe that government spending could stimulate.

How about John Maynard Keynes...who, if alive, would urge Congress to ease off that austerity brake for awhile longer -- and to ponder the lessons of how too much, too soon austerity in Europe has backfired.

But, yeah, for sure we need to eventually bring deficits down to manageable levels -- but for now, timing is everything.

" but for now, timing is everything."

You mean time it so that the real problems from all this debt can be can just be passed on to future generations if we can just get by now with three wheels?rolleyes.gif

Will you still be here in another five years time Jim Grant , pushing the same old line without any hint of an answer as to how all this money can ever be paid back?ermm.gif

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IMO Keynes was actually a pretty good economist. I don't think he saw government spending as stimulative per se, given its low fiscal multiplier, so much as smoothing out the sharpness of a downturn. What almost everyone fails to cite with respect to Keynes is, the thing that makes the government spending work is building reserves in times of economic strength. Most people only follow the spending part and not the saving part of his theories.

If it's a low fiscal multiplier, how can it be a good use of money at any time?

The way to stimulate an economy is to have minimal government pulling a minimal amount of capital out of the private sector, and let capital grow for creating new wealth.

Again, government is never a creator of wealth. It is always a net consumer of wealth. Unlike private industry, government is also wasteful, spilling about 1/2 of the money it collects in bureaucracy and other unnecessary spending. It has no need to show a profit so it has no one to answer to.

If it needs more money, it just says it needs to raise taxes. If it was a private company and doing that, the stockholders would revolt. But since it's always "someone else's money," then people just line up at the trough.

Keynes had it wrong because the government should never have taxed enough to build up a surplus except for its own use to pay government bills during a time of low tax income.

You cite the problem, though it's not with Keynes. During sunny weather governments never put anything by to save for that rainy day.Usually due to very short range thinking. You're also wrong in that if the government didn't spend it, poor multiplier and all, no one would, because they would hoard it riding out the down economy.

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You cite the problem, though it's not with Keynes. During sunny weather governments never put anything by to save for that rainy day.Usually due to very short range thinking. You're also wrong in that if the government didn't spend it, poor multiplier and all, no one would, because they would hoard it riding out the down economy.

You're kidding, right? People who have money invest it. Business people grow their businesses with it. If they bank it the bank loans it to someone else. When there is a down economy people look for somewhere else to invest. There are a lot of opportunities in a down economy if you have money. Few people just put it under a mattress.

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You cite the problem, though it's not with Keynes. During sunny weather governments never put anything by to save for that rainy day.Usually due to very short range thinking. You're also wrong in that if the government didn't spend it, poor multiplier and all, no one would, because they would hoard it riding out the down economy.

You're kidding, right? People who have money invest it. Business people grow their businesses with it. If they bank it the bank loans it to someone else. When there is a down economy people look for somewhere else to invest. There are a lot of opportunities in a down economy if you have money. Few people just put it under a mattress.

I made aqn investment in a down economy. I bought a house last year at 35% less than its 2003 tax assessment. Except for closing costs it didn't add a dime to GDP and someone took a big write down. You may have noticed starting back in 2008 that the savings rate shot back up from admittedly very low levels.

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You cite the problem, though it's not with Keynes. During sunny weather governments never put anything by to save for that rainy day.Usually due to very short range thinking. You're also wrong in that if the government didn't spend it, poor multiplier and all, no one would, because they would hoard it riding out the down economy.

You're kidding, right? People who have money invest it. Business people grow their businesses with it. If they bank it the bank loans it to someone else. When there is a down economy people look for somewhere else to invest. There are a lot of opportunities in a down economy if you have money. Few people just put it under a mattress.

I made aqn investment in a down economy. I bought a house last year at 35% less than its 2003 tax assessment. Except for closing costs it didn't add a dime to GDP and someone took a big write down. You may have noticed starting back in 2008 that the savings rate shot back up from admittedly very low levels.

I'll make one more attempt. The fact that there is an over supply of houses, selling for less than replacement cost was caused by the government. It started with Carter and was accelerated by Clinton. It became official policy of the US government that everyone should own a house. Lending rules were relaxed, to say the least.

"The National Homeownership Strategy began in 1994 when Clinton

directed HUD Secretary Henry Cisneros to come up with a plan, and

Cisneros convened what HUD called a "historic meeting" of private and

public housing-industry organizations in August 1994. The group

eventually produced a plan, of which Mason sent me a PDF of Chapter 4,

the one that argues for creative measures to promote homeownership.

The very worst idea in the plan, which fortunately never gained

approval, was to let first-time homebuyers freely tap their IRA and

401(k) retirement-savings plans with no penalty to scrounge up a

downpayment. That, HUD estimated, would have "benefited" 600,000

families in the first five years.

Plenty of other ideas in the plan did become reality, though. Knowing

what we know now about the housing bust, the earnest language in the

document seems faintly ridiculous. Here's an excerpt. Read it closely

and you can see the seeds of disaster being planted:" Read Business Week Article (emphasis mine)

So here's the government meddling in the private sector economy and promoting and aiding its collapse.

Now, that needs time to cure, because the government caused a massive over building.

Your investment took one of those parts of the mess out of the equation. It also is paying interest if you borrowed any money, to one of those investors we talked about. That investor might be a corporation with stockholders who benefit. If you paid cash then you put your own money to work. That home is wealth. You are increasing your wealth and new wealth is always welcome in the economy.

What you need to understand is that these losses and these write-downs need to be taken after the excesses. We need to get back to reality. The loss you mentioned that someone took wasn't due to your investment it was due to government interference in what should have been a free private market with real demand driving production. See the article above.

You still aren't addressing the massive deficits and debt that we are incurring, or how they are ever to be paid back. If government deficit stimulus would really permanently boost the economy, then later running surpluses to pay back the resultant debt would crash the economy. You can't have it just one way. That's silly.

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.

I have no comeback for the Europeans who mock the US for not having national health care. Theirs will collapse leaving them with no health care.

Britain's NHS started performing sterling service and giving good value in 1948.

That's 65 years ago,

Now it's going to collapse?

If, as you claim, after all that time, it for some reason "collapses", will it be because of any inbuilt deficiency in the NHS or it's relation to the economy......or because of general economic conditions which, considering the NHS is hardly inefficient spending half of US healthcare income wise, and delivering far greater peace of mind, cannot be blamed on the NHS in the way US healthcare can be said to be a major and growing cause of American economic malaise.

Thanks Cheeryble

Edited by cheeryble
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.

I have no comeback for the Europeans who mock the US for not having national health care. Theirs will collapse leaving them with no health care.

Britain's NHS started performing sterling service and giving good value in 1948.

That's 65 years ago,

Now it's going to collapse?

If, as you claim, after all that time, it for some reason "collapses", will it be because of any inbuilt deficiency in the NHS or it's relation to the economy......or because of general economic conditions which, considering the NHS is hardly inefficient spending half of US healthcare income wise, and delivering far greater peace of mind, cannot be blamed on the NHS in the way US healthcare can be said to be a major and growing cause of American economic malaise.

Thanks Cheeryble

Britain's Health Care System: Its Problems Continue

03/06/2013 06:38 PM ET Investor's Business Daily

Socialized Medicine: Missed the last horror story from Great Britain's government health care system? Don't worry, another alarming report will come soon. They just keep piling up like firewood in the fall.

On our minds right now is the story from the Daily Mail, which reported last week that nearly 40% of National Health Service workers — doctors, nurses and paramedics — said they would not recommend their own workplace to friends or family who need care.

More than 101,000 NHS workers responded to a survey that asked them if they agreed with the following statement:

"If a friend or relative needed treatment, I would be happy with the standard of care provided by this organization."

While 63% said they agreed or strongly agreed, 12% said they disagreed or strongly disagreed while a quarter, reports the Daily Mail, "did not 'express a preference.'"

"That left 37% of staff who did not recommend treatment."

This finding is a significant indictment. Even worse, at two of the system's worst hospitals, only 35% said they would recommend care at their workplace, and 17% overall said they "did not think patient care was their manager's top priority."

What would be a manager's focus, then? Saving money in a state-run system that can't tax enough to pay for the care it has promised?

Playing the bureaucratic game in a regime in which health care decisions are made by politics rather than by the patient and doctor working together?

One hospital within the NHS no longer subject to politics is Hinchingbrooke. The facility, located in Cambridgeshire, north of London, was privatized last year after, the Mail reports, being "on the verge of going bust."

More

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IMO Keynes was actually a pretty good economist. I don't think he saw government spending as stimulative per se, given its low fiscal multiplier, so much as smoothing out the sharpness of a downturn. What almost everyone fails to cite with respect to Keynes is, the thing that makes the government spending work is building reserves in times of economic strength. Most people only follow the spending part and not the saving part of his theories.

If it's a low fiscal multiplier, how can it be a good use of money at any time?

The way to stimulate an economy is to have minimal government pulling a minimal amount of capital out of the private sector, and let capital grow for creating new wealth.

Again, government is never a creator of wealth. It is always a net consumer of wealth. Unlike private industry, government is also wasteful, spilling about 1/2 of the money it collects in bureaucracy and other unnecessary spending. It has no need to show a profit so it has no one to answer to.

If it needs more money, it just says it needs to raise taxes. If it was a private company and doing that, the stockholders would revolt. But since it's always "someone else's money," then people just line up at the trough.

Keynes had it wrong because the government should never have taxed enough to build up a surplus except for its own use to pay government bills during a time of low tax income.

You cite the problem, though it's not with Keynes. During sunny weather governments never put anything by to save for that rainy day.Usually due to very short range thinking. You're also wrong in that if the government didn't spend it, poor multiplier and all, no one would, because they would hoard it riding out the down economy.

" Government always finds a need for whatever money it gets."

Ronald Reagan

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You mean time it so that the real problems from all this debt can be can just be passed on to future generations if we can just get by now with three wheels?rolleyes.gif

If too much austerity prevents a recovering economy, deficits (and resulting increased debt) will be higher than if we had laid off the brakes for a while longer. But, this thread has beaten to death stimulus vs. austerity -- and we're certainly never going to solve that argument on this forum. Guess we'll have to wait for the empirical data to eventually emerge -- although some in Europe are already beginning to question too much austerity....

Will you still be here in another five years time Jim Grant , pushing the same old line without any hint of an answer as to how all this money can ever be paid back?

sigh. Same old argument -- that retiring the debt is somehow a worthy cause. Just like in Business 101, where one studies how to arrive at optimum debt/equity ratios, debt isn't of its own a bad thing. Even households, carrying large mortgages, aren't viewed as flawed -- as long as they can service that debt.

And, of course, the most recent emphasis related to debt and deficits has been their ratios to GDP (and how faulty speadsheets can tip the balance). And, if such defined ratios can be met, the debt is effectively being 'serviced.' And, if during years of prosperity we can have balanced budgets, great. But a la Paul Ryan, dictating a balanced budget, without any regard to the state of the economy, is bad policy.

And,of course, to meet those ratios, deficits have to be reduced sometime in the future (and I guess the future is here, based on recent data -- hope it's not too much brake....). Social Security actually won't be too hard to fix -- if Congress can bite the bullet. Simpson-Boles pretty much got it right -- with means testing and raising (eliminating) the cap on FICA taxes. Health costs, unfortunately, will be the hard nut to crack.

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You mean time it so that the real problems from all this debt can be can just be passed on to future generations if we can just get by now with three wheels?rolleyes.gif

If too much austerity prevents a recovering economy, deficits (and resulting increased debt) will be higher than if we had laid off the brakes for a while longer. But, this thread has beaten to death stimulus vs. austerity -- and we're certainly never going to solve that argument on this forum. Guess we'll have to wait for the empirical data to eventually emerge -- although some in Europe are already beginning to question too much austerity....

>>>Will you still be here in another five years time Jim Grant , pushing the same old line without any hint of an answer as to how all this money can ever be paid back?

sigh. Same old argument -- that retiring the debt is somehow a worthy cause. Just like in Business 101, where one studies how to arrive at optimum debt/equity ratios, debt isn't of its own a bad thing. Even households, carrying large mortgages, aren't viewed as flawed -- as long as they can service that debt.

And, of course, the most recent emphasis related to debt and deficits has been their ratios to GDP (and how faulty speadsheets can tip the balance). And, if such defined ratios can be met, the debt is effectively being 'serviced.' And, if during years of prosperity we can have balanced budgets, great. But a la Paul Ryan, dictating a balanced budget, without any regard to the state of the economy, is bad policy.

And,of course, to meet those ratios, deficits have to be reduced sometime in the future (and I guess the future is here, based on recent data -- hope it's not too much brake....). Social Security actually won't be too hard to fix -- if Congress can bite the bullet. Simpson-Boles pretty much got it right -- with means testing and raising (eliminating) the cap on FICA taxes. Health costs, unfortunately, will be the hard nut to crack.

You fail to address a couple of issues. First is that the stimulus is partly the Fed holding interest rates at about zero. They are doing that by creating money to hold much of the new debt from deficit spending "in house." The standard method to control inflation, right or wrong, is to raise interest rates to cool things off. So if this massive "printing" of money that's happened causes inflation which it will if the economy picks up, the Fed will need to raise rates.

Have you even thought about what would happen to the US expenses and deficits if the interest on the national debt went to a more normal 5 percent? What is 5% of 17 trillion dollars? It couldn't be paid. It's about 1/2 the total income of the US government, gone in interest alone. The only option the Fed would have is to keep printing money in an already inflationary environment.

Inflation is just another way of saying that money lost value. That's it. If you print enough US dollars that they are blowing down the street and considered a nuisance because people have to pay someone to clean them out of their bushes, that's inflation.

Governments from Greece to the US have only so much control over this mess. At some point they totally lose control.

This is a law of economics: You can control the price of something but if you do you can't control the demand at that price. Or, you can control the supply of something, but if you do you can't control the price. In both cases the market will decide how much it will buy at a certain price, or how much it will pay at a given supply.

(Just think about how Thailand tried to control the price of rice by controlling the supply. Thailand is on its face over that.)

Major economies are going to find out that they eventually lose control by trying to control one side of the money supply.

Edited by NeverSure
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Rigged oil market- surprise ?

No

And the fines will be just % of profits, viewed as a cost of biz and probably make everything more expensive :(

The whole system is problem; austerity vs stimulus, both a flawed arguments. All that can happen is bump along until nature takes its course

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From sky news app:

Oil Firms Probed Over Suspected Price-Fixing

Last Updated 13:02 15/05/2013

The Government has said it would be "deeply worrying" if energy prices have been driven up through market manipulation amid an investigation into activities at BP and Shell.

Offices of Norwegian firm Statoil were also raided by officials on Tuesday, as the European Commission examined allegations of possible wrong-doing in the pricing of oil, petrol, biofuel and other refined products.

A Downing Street spokesman said: "The European Commission is investigating and we would expect any companies which it wants to talk to to fully comply with these investigations."

The Energy Secretary Ed Davey later told MPs that anyone found to have manipulated prices would face the "full force of the law."

MP On Oil Probe

The Commission said it had launched the investigation over suspected anti-competitive agreements related to the submission of prices to Platts, the world's leading oil pricing agency.

"Officials carried out unannounced inspections at the premises of several companies active in and providing services to the crude oil, refined oil products and biofuels sectors," the EU's executive arm said in a statement.

"The Commission has concerns that the companies may have colluded in reporting distorted prices to a price reporting agency to manipulate the published prices for a number of oil and biofuel products.

"Furthermore, the Commission has concerns that the companies may have prevented others from participating in the price assessment process, with a view to distorting published prices," it added.

The statement did not identify the companies involved, saying the inspections had taken place in two EU member states and one non-EU country.

The three companies confirmed they were subject to the inquiry.

A Royal Dutch Shell spokesperson said: "We can confirm that Shell companies are currently assisting the European Commission in an enquiry into trading activities.

"We are fully cooperating with the investigation," the spokesperson said, declining to comment further for legal reasons.

Pump Prices Vs Crude Oil Costs

A BP statement also said the company was "cooperating fully" with the probe.

Statoil said the inspection, at its headquarters in Stavanger, Norway, had been carried out with the assistance of Norwegian antitrust officials. Norway is not part of the EU.

Statoil said the suspected violations may have been ongoing since 2002.

Platts said in a statement that "the European Commission has undertaken a review at its premises in London this morning in relation to the Platts price assessment process.

"Platts is cooperating fully with the European Commission's review."

The investigation - one of the biggest cross-border actions since the Libor rigging scandal - had no impact on the London-listed share prices of BP or Shell on Tuesday though Shell's value dipped by more than 1% early on Wednesday.

The Commission said even small distortions of assessed prices may have a huge impact on the prices of crude oil, refined oil products and biofuels purchases and sales, potentially harming final consumers.

It said EU officials were accompanied by their counterparts from the national competition authorities, and stressed that the fact such inspections had been carried out did not mean the companies were guilty of anti-competitive behaviour.

Speaking on Jeff Randall Live, Robert Halfon MP, who had previously expressed concern over possible market manipulation, said: "This is incredibly serious because the price of petrol and diesel has gone up by 60% over the last few years despite the fact that the Government has both cut and frozen fuel duty.

"This impacts on the lives of millions of people up and down our country, not just people who drive cars - it affects food prices and transport and business and everything else."

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Arrangements like this don't help either:

Amazon.com's main UK unit paid £2.4m in taxes in 2012 on sales of £4.3bn, newly-published accounts have revealed.

The accounts also showed the company received £2.5m in government grants over the course of the year.

It is believed the company was able to report the relatively small corporate income tax bill because its sales to British customers are routed through a Luxembourg affiliate, Amazon EU Sarl.

-sky

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.

I have no comeback for the Europeans who mock the US for not having national health care. Theirs will collapse leaving them with no health care.

Britain's NHS started performing sterling service and giving good value in 1948.

That's 65 years ago,

Now it's going to collapse?

If, as you claim, after all that time, it for some reason "collapses", will it be because of any inbuilt deficiency in the NHS or it's relation to the economy......or because of general economic conditions which, considering the NHS is hardly inefficient spending half of US healthcare income wise, and delivering far greater peace of mind, cannot be blamed on the NHS in the way US healthcare can be said to be a major and growing cause of American economic malaise.

Thanks Cheeryble

Britain's Health Care System: Its Problems Continue

03/06/2013 06:38 PM ET Investor's Business Daily

Socialized Medicine: Missed the last horror story from Great Britain's government health care system? Don't worry, another alarming report will come soon. They just keep piling up like firewood in the fall.

On our minds right now is the story from the Daily Mail, which reported last week that nearly 40% of National Health Service workers — doctors, nurses and paramedics — said they would not recommend their own workplace to friends or family who need care.

More than 101,000 NHS workers responded to a survey that asked them if they agreed with the following statement:

"If a friend or relative needed treatment, I would be happy with the standard of care provided by this organization."

While 63% said they agreed or strongly agreed, 12% said they disagreed or strongly disagreed while a quarter, reports the Daily Mail, "did not 'express a preference.'"

"That left 37% of staff who did not recommend treatment."

This finding is a significant indictment. Even worse, at two of the system's worst hospitals, only 35% said they would recommend care at their workplace, and 17% overall said they "did not think patient care was their manager's top priority."

What would be a manager's focus, then? Saving money in a state-run system that can't tax enough to pay for the care it has promised?

Playing the bureaucratic game in a regime in which health care decisions are made by politics rather than by the patient and doctor working together?

One hospital within the NHS no longer subject to politics is Hinchingbrooke. The facility, located in Cambridgeshire, north of London, was privatized last year after, the Mail reports, being "on the verge of going bust."

More

Nevermore:

1. Are you aware of how biased IBD is?

2. Are you aware of how biased the Daily Mail is?

.....yes yes I'll get on to substance:

3. Are you aware of selection bias, and do you see how it is relevant to the survey results?

4. Are you also aware that there were 202,000 people surveyed....but IBD chose not to mention this.

5. Are you aware that satisfied people tend not to answer questionnaires, which likely applies to the unmentioned 101,000?

6. Are you aware that the statement

"That left 37% of staff who did not recommend treatment." might be phrased

"94% of staff surveyed did not have any strong complaint, a low number in any occupation but remarkable given it;s a health service and the best of clinicians and medical staff and hospitals worldwide draw very regular complaints as their science is inexact and about judgements and the best judgements are stochastic and do not always work out".

7. Are you aware it is unlikely there would be no complaints when the NHS is a tradeoff where the British parliament in it's wisdom has decided to err towards the low budget end of the scale which of course brings benefits for other services in the country.

etc etc it's 2.20am.

ps: I don't need surveys, my sister worked in the NHS for 30 years.

She thinks the stenting treatment she had and her husband's decades long prostate treatment and her daughter's mental health problem has been "wonderful"...her words.....and they have always opted for NHS treatment knowing full well about it and yet having more than adequate funds for private.

Edited by cheeryble
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.

I have no comeback for the Europeans who mock the US for not having national health care. Theirs will collapse leaving them with no health care.

Britain's NHS started performing sterling service and giving good value in 1948.

That's 65 years ago,

Now it's going to collapse?

If, as you claim, after all that time, it for some reason "collapses", will it be because of any inbuilt deficiency in the NHS or it's relation to the economy......or because of general economic conditions which, considering the NHS is hardly inefficient spending half of US healthcare income wise, and delivering far greater peace of mind, cannot be blamed on the NHS in the way US healthcare can be said to be a major and growing cause of American economic malaise.

Thanks Cheeryble

Britain's Health Care System: Its Problems Continue

03/06/2013 06:38 PM ET Investor's Business Daily

Socialized Medicine: Missed the last horror story from Great Britain's government health care system? Don't worry, another alarming report will come soon. They just keep piling up like firewood in the fall.

On our minds right now is the story from the Daily Mail, which reported last week that nearly 40% of National Health Service workers — doctors, nurses and paramedics — said they would not recommend their own workplace to friends or family who need care.

More than 101,000 NHS workers responded to a survey that asked them if they agreed with the following statement:

"If a friend or relative needed treatment, I would be happy with the standard of care provided by this organization."

While 63% said they agreed or strongly agreed, 12% said they disagreed or strongly disagreed while a quarter, reports the Daily Mail, "did not 'express a preference.'"

"That left 37% of staff who did not recommend treatment."

This finding is a significant indictment. Even worse, at two of the system's worst hospitals, only 35% said they would recommend care at their workplace, and 17% overall said they "did not think patient care was their manager's top priority."

What would be a manager's focus, then? Saving money in a state-run system that can't tax enough to pay for the care it has promised?

Playing the bureaucratic game in a regime in which health care decisions are made by politics rather than by the patient and doctor working together?

One hospital within the NHS no longer subject to politics is Hinchingbrooke. The facility, located in Cambridgeshire, north of London, was privatized last year after, the Mail reports, being "on the verge of going bust."

More

Nevermore:

1. Are you aware of how biased IBD is?

2. Are you aware of how biased the Daily Mail is?

.....yes yes I'll get on to substance:

3. Are you aware of selection bias, and do you see how it is relevant to the survey results?

4. Are you also aware that there were 202,000 people surveyed....but IBD chose not to mention this.

5. Are you aware that satisfied people tend not to answer questionnaires, which likely applies to the unmentioned 101,000?

6. Are you aware that the statement

"That left 37% of staff who did not recommend treatment." might be phrased

"94% of staff surveyed did not have any strong complaint, a low number in any occupation but remarkable given it;s a health service and the best of clinicians and medical staff and hospitals worldwide draw very regular complaints".

etc etc it's 2.20am.

ps: I don't need surveys, my sister worked in the NHS for 30 years.

She thinks the stenting treatment she had and her husband's decades long prostate treatment and her daughter's mental health problem has been "wonderful"...her words.....and they have always opted for NHS treatment knowing full well about it and yet having more than adequate funds for private.

How about "approximately 1/2 of all of those queried failed to answer because they are disgusted with the system?" I can plug anything in there I'd like.

Here:

Administrator to cut services after takeover of ailing South London Healthcare Trust

Crackdown launched on 'hidden NHS waiting lists'

Struggling NHS trusts get £1.5bn bailout

South London NHS Trust put into administration

I could spend all day trying to copy all of the links from a simple google search of "NHS problems."

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How about "approximately 1/2 of all of those queried failed to answer because they are disgusted with the system?" I can plug anything in there I'd like.

Me illegitimately plug? Are you serious?

What a nerve....

You came up with the extremely selective interpretation from the well known politically motivated IBD (quoting the well known politically motivated Daily Mail rather than going direct to the source data).

I (that's a capital I for emphasis) merely pointed out the error of IBD's ways......and i listed them......and offered an alternative presentation of the facts which made the NHS suddenly look damn good.

I think that IBD article was absolute trash, and listed exactly why without resorting to the last resort of a failed argument.....selective anecdotes, which frankly is like kicking all the chess pieces over.

I think you should have known better that IBD article was unbalanced to the point of being disingenuous.

ps: if you'd like to criticize the TIME cover article I linked by all means do so. Again, it was one of the biggest selling TIME articles of all time, whichsays something about the concerns of the American people.

http://livingwithmcl.com/BitterPill.pdf

(Do bear in mind the dissatisfaction of the American people is twice as expensive as that of the British)

pps: I mentioned my sister, oddly enough she and her husband are economically quite right wing and are Daily Mail readers.

Despite that, like Margaret Thatcher, she says the NHS is far to important to be left to capitalism.

Edited by cheeryble
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