evolution and economics
bpuharic
many economists are trying to integrate the ideas of evolutionary
biology into their subject (i avoid calling economics a 'science'):
http://www.newsweek.com/id/232111
in Atlanta earlier this month, the annual meeting of the American
Economic Association was home to more soul-searching than number
crunching. Hundreds of the profession's most eminent thinkers turned
out to hear panel after panel discuss how, exactly, they'd gotten
things so wrong. Why did most of the world's top economists fail to
forecast the financial crisis? Should the teaching of economics in
universities be entirely rethought? While past stars at the AEA have
been conservative, finance--oriented intellectuals like Eugene Fama,
this year's meeting belonged to the liberal realists�Paul Krugman,
Robert Shiller, and the man of the hour, Nobel laureate Joseph
Stiglitz. Stiglitz delivered a keynote debunking the profession's key
tenet�namely, that markets can be trusted. Leading into the crisis,
Stiglitz said, "markets were not efficient and not self-correcting,
and now huge costs in the trillions of dollars are being borne by
every part of society."
At least since Reagan, the consensus was that you just had to make the
pie grow, and the best way to do that was to unshackle markets and
investors, and then get out of the way. Wealth, and thus health,
happiness, and all other good things, would eventually trickle down to
all.
Now that this view has been proved false, a whole slew of new theories
are competing to take its place. All are based, to one extent or
another, on the idea that people are irrational actors, and that
markets aren't always efficient.
And in many cases, the new theories blend economics with entirely
different disciplines. The adaptive-markets hypothesis, for instance,
proposes a new way of looking at the economy, and in particular the
financial markets: through the prism of evolutionary biology. The idea
is simple enough: adherents view the economy and financial markets as
an ecosystem, with different "species" (hedge funds, investment banks)
vying for "natural resources" (profits). These species adapt to one
another, but also go through periods of sudden mutations (read:
crises), which dramatically alter the makeup of the ecosystem. To
advocates of this theory, cell biology could hold the key to a new,
unifying theory of economics; policymakers like Larry Summers can
craft better policy, they suggest, by considering all market players
as parts of a living organism.
Vend
> Why did most of the world's top economists fail to
> forecast the financial crisis?
I'm no world's top economist, but I don't think that the world
economic crisis was so difficult to forecast:
growing population + growing percentage of industrialized population +
growing income inequality + decreasing natural resources = ?
Burkhard
> with the collapse of the idea of the efficiency of the 'free market',
> many economists are trying to integrate the ideas of evolutionary
> biology into their subject (i avoid calling economics a 'science'):
>
> http://www.newsweek.com/id/232111
>
> Economic Association was home to more soul-searching than number
> crunching. Hundreds of the profession's most eminent thinkers turned
> out to hear panel after panel discuss how, exactly, they'd gotten
> things so wrong. Why did most of the world's top economists fail to
> forecast the financial crisis? Should the teaching of economics in
> universities be entirely rethought? While past stars at the AEA have
> been conservative, finance--oriented intellectuals like Eugene Fama,
> Robert Shiller, and the man of the hour, Nobel laureate Joseph
> Stiglitz. Stiglitz delivered a keynote debunking the profession's key
You means they are rediscovering Spencer?
bpuharic
wrote:
i think what really made it happen was, as alan greenspan said, greed,
pure and simple
the CDO's, the swaps, etc...wall street invented new financial
instruments and they spun out of control.
John Wilkins
<5d57914e-8e5b-4605...@22g2000yqr.googlegroups.com>,
Burkhard <b.sc...@ed.ac.uk> wrote:
> On 23 Jan, 22:51, bpuharic <w...@comcast.net> wrote:
> > with the collapse of the idea of the efficiency of the 'free market',
> > many economists are trying to integrate the ideas of evolutionary
> > biology into their subject (i avoid calling economics a 'science'):
> >
> > http://www.newsweek.com/id/232111
> >
> > �in Atlanta earlier this month, the annual meeting of the American
> > Economic Association was home to more soul-searching than number
> > crunching. Hundreds of the profession's most eminent thinkers turned
> > out to hear panel after panel discuss how, exactly, they'd gotten
> > things so wrong. Why did most of the world's top economists fail to
> > forecast the financial crisis? Should the teaching of economics in
> > universities be entirely rethought? While past stars at the AEA have
> > been conservative, finance--oriented intellectuals like Eugene Fama,
> > this year's meeting belonged to the liberal realists�Paul Krugman,
> > Robert Shiller, and the man of the hour, Nobel laureate Joseph
> > Stiglitz. Stiglitz delivered a keynote debunking the profession's key
> > tenet�namely, that markets can be trusted. Leading into the crisis,
Or evolutionary economics, anyway:
Boulding, Kenneth E. 1981. Evolutionary economics. Beverly Hills,
Calif.: Sage Publications.
Hamilton, David Boyce. 1991. Evolutionary economics: a study of change
in economic thought. New Brunswick, N.J., U.S.A.: Transaction
Publishers.
Hanappi, Hardy. 1994. Evolutionary economics: the evolutionary
revolution in the social sciences. Aldershot, England; Brookfield, Vt.,
USA: Avebury.
Leydesdorff, Loet, and Peter Van den Besselaar, eds. 1994. Evolutionary
economics and chaos theory: new directions in technology studies.
London: Pinter Publishers.
Magnusson, Lars, and Jan Ottosson, eds. 1997. Evolutionary economics
and path dependence. Cheltenham, UK; Brookfield, US: Edward Elgar.
Metcalfe, J. Stanley. 1998. Evolutionary economics and creative
destruction. London; New York: Routledge.
Weeks, John, and Charles Galunic. 2003. A Theory of the Cultural
Evolution of the Firm: The Intra-Organizational Ecology of Memes.
Organization Studies 24 (8):1309-1352.
Wilkins, John S. 2001. The appearance of Lamarckism in the evolution of
culture. In Darwinism and evolutionary economics, edited by J. Laurent
and J. Nightingale. Cheltenham UK: Edward Elgar:160-183.
bpuharic
wrote:
>>
>> You means they are rediscovering Spencer?
>>
>Or evolutionary economics, anyway:
>
>Wilkins, John S. 2001. The appearance of Lamarckism in the evolution of
>culture. In Darwinism and evolutionary economics, edited by J. Laurent
>and J. Nightingale. Cheltenham UK: Edward Elgar:160-183.
wilkins? geez that guy is everywhere...
chris thompson
Greenspan should STFU and crawl into a hole, and pull the top closed
over himself.
Chris
bpuharic
i think he and cheney are evil twins
Kalkidas
b9be5b...@e37g2000yqn.googlegroups.com:
+ human race under the sway of bogus ethic that the purpose of life is to
produce and consume material goods for sense gratification...
= society of two-legged beasts.
Paul J Gans
Not fully. Greenspan has admitted that he "misjudged" the situation
and basically that he screwed up the situation. I've seen nothing
from Cheney except the usual old stuff.
--
--- Paul J. Gans
bpuharic
probably true...plus i don't recall greenspan advocating torture for
wall street bankers...
perhaps he and cheney should have switched jobs
bpuharic
wrote:
one can only wonder where 'kalkidas' draws the conclusion that most
people think this way.
oh well...creaetionists never explain much of anything. the whole
system is an interlocking net of lies and fabrications.
JTEM
bpuharic <w...@comcast.net> wrote:
> with the collapse of the idea of the efficiency
> of the 'free market',
It never collapsed. It never truly existed, true,
but it certainly never collapsed.
What we have now, what we've had at least since the
1980s is a neo-mercantile system, where instead of
nation states, the lines are drawn at the feet of
elite families and the doors of international
corporations.
"Crony Capitalism" I've always called it,
Example: In a free market, the market decides the
value of every commodity, including labor. In the
crony capitalist U.S. market though, when the market
decided that jobs weren't paying enough, the cronies
imported illegal alien labor. The result is that those
jobs actually pay __Less__ today, when you take into
account inflation, then they did 30 or 40 years ago.
Market decides: Pay More.
Crony Capitalism: Pay Less.
It's no different than smuggling in, say, lumber or
wool to gain a competitive edge.
JTEM
bpuharic <w...@comcast.net> wrote:
> i think what really made it happen was, as
> alan greenspan said, greed, pure and simple
There's nothing to think about. It's energy. It's
100% energy. Anyone who doubts need look no further
than the 1970s, when it all happened before.
All of it.
The United States hit "Peak Oil" in the early 70s.
Mexico hit "Peak Oil" a couple of years ago:
http://en.wikipedia.org/wiki/Oil_reserves_in_Mexico
....and, at this point, most indications are that
even Saudi Arabia has hit "Peak Oil."
http://en.wikipedia.org/wiki/Peak_oil
Globally, by (wait for it) 2012 we will most definitely
be into global "Peak Oil."
This means that no matter how much demand rises from
that point onward, production will be declining.
The world will be producing __LESS__ oil every year
than the previous year.
And, yeah THAT is the source of all our global economic
problems right now.
el cid
> bpuharic <w...@comcast.net> wrote:
> >On Sat, 23 Jan 2010 16:49:08 -0800 (PST), chris thompson
> >>On Jan 23, 6:50锟絧m, bpuharic <w...@comcast.net> wrote:
> >>> On Sat, 23 Jan 2010 15:43:59 -0800 (PST), Vend <ven...@virgilio.it>
> >>> wrote:
>
> >>> >On 23 Gen, 23:51, bpuharic <w...@comcast.net> wrote:
> >>> >> Why did most of the world's top economists fail to
> >>> >> forecast the financial crisis?
>
> >>> >I'm no world's top economist, but I don't think that the world
> >>> >economic crisis was so difficult to forecast:
>
> >>> >growing population + growing percentage of industrialized population +
> >>> >growing income inequality + decreasing natural resources = ?
>
> >>> i think what really made it happen was, as alan greenspan said, greed,
> >>> pure and simple
>
> >>> the CDO's, the swaps, etc...wall street invented new financial
> >>> instruments and they spun out of control.
>
> >>Greenspan should STFU and crawl into a hole, and pull the top closed
> >>over himself.
> >i think he and cheney are evil twins
>
> and basically that he screwed up the situation. 锟絀've seen nothing
> from Cheney except the usual old stuff.
<rant on>
Isn't it more obvious than "greed" or "misjudging"?
It was a repeat bubble as a hangover to the internet/biotech bubble.
It's not just greed, it's economic delusions.
During the internet bubble valuations of shares soared beyond
_any_ remotely sane concept of value. By sane, I mean based
on tangible earnings as opposed to 'well some fool may pay
even more for this stock than I did so, order more'. The
greed factors in when you see others getting rich and decide,
even though you know it's all smoke and mirrors, you want some
too. But it's not just greed, it's greed fueled delusion.
In the aftermath of the internet bubble bursting, we found
that the only strong tangible part of the economy was housing
and various people decided it should be promoted so something
could move mutual funds up and keep the spending going. So
of course people refinanced overinflated houses to support
otherwise unsubstanable lifestyles because they were so
delusional as to think it made sense. And of course you need
to remodel a kitchen every few years. Everyone knew housing
was too expensive but they ignored the ponzi scheme aspect
of it. It's all willing delusion. An economy can't be based
purely on moving money around or on spending but saying so
is taken as some sort of heresy. No real recovery will
happen until that changes. But the expectations have been
set that people who work in the finance industry actually
deserve big bucks and aren't just vampires sucking the
life out of actually productive parts of the economy.
</rant off>
JTEM
el cid <elcidbi...@gmail.com> wrote:
> Everyone knew housing was too expensive but they
> ignored the ponzi scheme aspect of it.
The loans which were a real problem -- the "Adjustables"
which saw there rates as much as triple -- only ever
made sense for a flipper.
Nobody, and I do mean NOBODY, believed for one moment
that these mortgages were sustainable. Nobody in the
private sector or the government believed that these
mortgages weren't a time bomb waiting to explode.
It was as much of a scam as the Tech Bubble. The insiders
loaned unsustainable mortgages to people they knew could
never afford them, then they immediately turned around
and sold them off, confident that the government would
pay off the damages.
You know, EXACTLY as they did with the last banking crisis.
People think that these things just happen, or that it's
stupidity or a lack of oversight. But, the example that
truly reveals the truth -- even better than the S&L crisis
or the mortgage crisis, was the tech bubble.
When the internet stocks first hit the market, they didn't
value them like any existing industry. "Oh!," they claimed,
"This is all brand new! We don't know how to value them!"
But it was all bullshit. There isn't an investment house
worth it's salt that doesn't know the difference between
a good company and a bad one, regardless of where or how
they get their revenue.
Anyhow, internet companies, for purposes of their initial
offerings, were valued at $1 thousand dollars per unique
"Hit" per month. So if a website received a million unique
hits a month, it was worth a billion dollars... even if it
had little or no assets to speak of, and no apparent means
for creating revenue let alone revenue enough to warrant a
billion dollars in value.
There isn't an investment house that didn't know this. There
wasn't a single person sitting on any market that didn't
know this. Every government regulator knew this.
The venture capitalists would find a popular website, invest
like $20 million dollars in them but effectively taking
control of the companies. They would then spend as much of
the money they could on advertisement, boosting the number
of monthly "Hits." When they got it high enough, they
issued their IPO, cashed in their 20% of their worthless
shares (presently worth about $200 million) and lived
happily ever after.
It was a swindle. It was legalized robbery. And, yes, the
mortgage crisis was created by the exact same thing: Legalized
robbery.
They sold a shit load of unsustainable mortgages and then
turned right around sold them.
The people who sold them knew they were selling worthless
pieces of paper to investors (just like in the case of the
internet stocks), the government understood the problem,
the people responsible for stopping it all are always
either bribed or bullied into sitting on their hands and
doing nothing.
There was never any delusions. There were no "Mistakes"
made. All the industry insiders, all the government
regulators knew exactly what was happening. They just
refused to stop it... like they refused to stop the
internet stock scam... like they refused to stop the
S&L madness...
In every case it had to implode before the government
stepped in, taxed the little guy and payed for the
mistakes made by the uber rich.
Google it. Nothing I've said is new or even a secret.
bpuharic
<elcid...@gmail.com> wrote:
>On Jan 23, 10:53�pm, Paul J Gans <gan...@panix.com> wrote:
>> bpuharic <w...@comcast.net> wrote:
>
>>
>> >>Greenspan should STFU and crawl into a hole, and pull the top closed
>> >>over himself.
>> >i think he and cheney are evil twins
>>
>> Not fully. �Greenspan has admitted that he "misjudged" the situation
>> and basically that he screwed up the situation. �I've seen nothing
>> from Cheney except the usual old stuff.
>
><rant on>
>Isn't it more obvious than "greed" or "misjudging"?
>
>It was a repeat bubble as a hangover to the internet/biotech bubble.
>It's not just greed, it's economic delusions.
>
>During the internet bubble valuations of shares soared beyond
>_any_ remotely sane concept of value. By sane, I mean based
>on tangible earnings as opposed to 'well some fool may pay
>even more for this stock than I did so, order more'. The
>greed factors in when you see others getting rich and decide,
>even though you know it's all smoke and mirrors, you want some
>too. But it's not just greed, it's greed fueled delusion.
>
what i found disquieting is the degree to which 'financial engineers'
invented all these finanical instrumentalities that they invented
'pricing models' for. they pretended these models were valid even
though the guy who invented the math behind asset pricing told them
they were mis-applying his model
they then sold these things over and over...
lack of regulation and belief in a 'free' and 'efficient' market,
unsubstantiated by evidence, caused this collapse. it's a good thing
the belief in an 'efficient' market is dying.
Mike Dworetsky
These factors had nothing to do with the 2007-09 crisis and subsquent
recession.
The theory that the free market is a solution to all our economic woes is
based on the [false] assumption that the decisions are rationally based on
correct and full information available to all (the reason why insider
dealing is a crime).
This was massively violated in the race to create all sorts of derivative
securities out of mortgage loans that turned out to have been made to very
doubtful customers. Those buying such securities, often repackaged at
second or third remove, had no clear idea of the true risks, nor did the
companies such as AIG who routinely insured them by providing credit ratings
for the bonds.
Once the crisis started there was little to stop the ball rolling downhill.
I could go on and on about greedy bankers but you get the idea.
If you look at China, all your above factors should be causing the country
to collapse but in fact it is the most rapidly growing economy in the world.
So I don't think these are the cause of the present situation. Though I
agree something needs to be done about the problems.
I can recall back in the late 70s and early 80s, banks were falling over
each other in a competition to see who could loan the most money to
third-world countries. Of course, most of that money went into the Swiss
bank accoutns of the local dictators and generals, the countries could not
pay back the loans, and there had to be a huge publicly funded bail-out.
The safest assumption at any time is to assume that bankers are no smarter
than anyone else, act on herd instincts, and often give customers and
shareholders poor advice. How else (in the UK) could you explain the
collapse of Royal Bank of Scotland? And the disaster that befell Lloyds TSB
bank when a top-level cocktail party decision was made to merge with the
failing Halifax Bank of Scotland? In both cases, ill-advised mergers with
banks that had massive exposure to "toxic loans" was the immediate cause.
--
Mike Dworetsky
(Remove pants sp*mbl*ck to reply)
Rolf
You only forgot greed. In contrast to the rest of life on this planet, man
isn't satsified with a full belly. He is in fact insatiable, as soon as he
have had his dinner and some sex he is ready for the stock market or poker
table or rock climbing or or or ad infinitum.
JTEM
bpuharic <w...@comcast.net> wrote:
> lack of regulation and belief in a 'free' and 'efficient'
> market, unsubstantiated by evidence, caused this collapse.
Utter bullshit.
You haven't the faintest clue. To demonstrate, map it out
for us. Point to real life examples. Thanks in advance for
nothing.
bpuharic
wrote:
go read about adaptive market theory
then c'mon back when you actually know something instead of thinking
you know something, OK?
Stephen
If you think it's utter bullshit, how 'bout providing the detailed
analysis as to why? Otherwise, why should anyone think _you_ have a
clue?
--
Paul J Gans
What? So that we could put mortgage defaulters in Guantanamo?
:-)
Paul J Gans
>bpuharic <w...@comcast.net> wrote:
>Utter bullshit.
I disagree. AIG is but one example. They were insolvent
for some time but did not collapse. It was like Wiyl E.
Coyote running off a cliff and not looking down.
Banks traded in junk, worthless securities. AIG *insured*
those banks against the failure of those securities.
There was no regulation of these markets at all. There were
calls for regulation, but (and you can google for this) the
response was that our "free market" system was working just
fine.
bobsyo...@yahoo.com
"bpuharic" <wf...@comcast.net> wrote in message
news:f5vml5583infk8gh1...@4ax.com...
> with the collapse of the idea of the efficiency of the 'free market',
> many economists are trying to integrate the ideas of evolutionary
> biology into their subject (i avoid calling economics a 'science'):
I recall, from my college days, a professor saying something like - the main
activity of economicists is to try to convince themselves, and others, that
it IS science.
yea .......... and so is creationism.
>
> http://www.newsweek.com/id/232111
>
> in Atlanta earlier this month, the annual meeting of the American
> Economic Association was home to more soul-searching than number
> crunching. Hundreds of the profession's most eminent thinkers turned
> out to hear panel after panel discuss how, exactly, they'd gotten
> things so wrong. Why did most of the world's top economists fail to
> forecast the financial crisis? Should the teaching of economics in
> universities be entirely rethought? While past stars at the AEA have
> been conservative, finance--oriented intellectuals like Eugene Fama,
> this year's meeting belonged to the liberal realists-Paul Krugman,
> Robert Shiller, and the man of the hour, Nobel laureate Joseph
> Stiglitz. Stiglitz delivered a keynote debunking the profession's key
> tenet-namely, that markets can be trusted. Leading into the crisis,
Paul J Gans
>Rolf wrote:
>I once saved this cartoon to my hard disk, which seems to express the
>same general idea:
><http://img62.imageshack.us/img62/2145/thehistoryoftechnology.gif>
<grin>
I agree!
James Beck
<elcid...@gmail.com> wrote:
>On Jan 23, 10:53�pm, Paul J Gans <gan...@panix.com> wrote:
>> bpuharic <w...@comcast.net> wrote:
>> >On Sat, 23 Jan 2010 16:49:08 -0800 (PST), chris thompson
>> ><chris.linthomp...@gmail.com> wrote:
>> >>On Jan 23, 6:50�pm, bpuharic <w...@comcast.net> wrote:
>> >>> On Sat, 23 Jan 2010 15:43:59 -0800 (PST), Vend <ven...@virgilio.it>
>> >>> wrote:
>>
>> >>> >On 23 Gen, 23:51, bpuharic <w...@comcast.net> wrote:
>> >>> >> Why did most of the world's top economists fail to
>> >>> >> forecast the financial crisis?
>>
>> >>> >I'm no world's top economist, but I don't think that the world
>> >>> >economic crisis was so difficult to forecast:
>>
>> >>> >growing population + growing percentage of industrialized population +
>> >>> >growing income inequality + decreasing natural resources = ?
>>
>> >>> i think what really made it happen was, as alan greenspan said, greed,
>> >>> pure and simple
>>
>> >>> the CDO's, the swaps, etc...wall street invented new financial
>> >>> instruments and they spun out of control.
>>
>> >>Greenspan should STFU and crawl into a hole, and pull the top closed
>> >>over himself.
>> >i think he and cheney are evil twins
>>
>> Not fully. �Greenspan has admitted that he "misjudged" the situation
>> and basically that he screwed up the situation. �I've seen nothing
Not too bad. It's hardly even a rant at all and you made some mileage
past the superficial press reports and toward a plausible story, but
you didn't take it back far enough in time.
There were several (recent) causes. The one you're most likely to see
eventually is that the banks were over-regulated relative to other
financial entities. Note: that does not mean that banks were
over-regulated. If you squeeze the balloon in one place, it pops out
in another. Enormous pools of money have been largely unregulated,
e.g., hedge funds. It would be hard to deny that the opportunities in
real estate were very profitable. Profits attract both investors and
speculators.
OTOH, like most of the spin on both sides, that tells you a bit about
what happened, but not much about why. Here's a plausible story:
Whether the federal government taxes and spends (Democrats) or borrows
and spends (Republicans), when the government fails to meet its budget
constraint (runs deficits), you get inflation. Since Paul Volcker, the
Fed has been careful to control consumer price inflation, but that
doesn't mean that the money went away. Instead, it has been showing up
in equity (stocks/real estate) price bubbles.
Although Bush Sr. was excoriated for doing it, his tax increase is
widely thought to have headed off an earlier equity market bubble. It
also resulted in a nearly balanced budget. On the other hand, cutting
off that bubble may have contributed to the later problems in Japan.
The response to that was an increase in liquidity and stimulation of
the US economy to consume Japan's inventory overhang. That in turn led
to currency bubbles and the emerging markets collapse in 1998. The
response was again, more liquidity and stimulation of the US economy
to consume the emerging markets' inventory overhang. That further
puffed up the tech bubble that ended in 2000-still more liquidity.
Off-budget war combined with a tax cut? The expected bubble didn't
disappoint. ...
Why real estate? Two main factors (recently. This problem dates back
to when they broke the tax code in the early 1900s). China pegged the
yuan to the dollar at a low level. That heavily stimulated its exports
to the US. To maintain the peg they bought US assets. They started to
taper off their buying in early 2005. Under heavy pressure from the US
that started several years earlier, they floated their currency in
July 2005. That sequence coincides with the peak in US real estate
prices. Likewise, demand for US equity by countries in the Middle East
dropped off in mid-2005.
Several pundits predicted that the market would do poorly beginning in
2007. Their primary argument was that Bernanke's Fed was unwilling to
support the constant injections of liquidity that had been common
under Greenspan. Although there were plenty of opportunities in 2007,
the broad market didn't do very well. Things melted down from there.
Although it's a lot to wrap your head around, this is a complex
turducken (a chicken inside a duck inside a turkey). On the outer
layer, secular trends, especially global demographics, have been
deteriorating. The UN has a very nice map if you want to google it.
Oddly enough, quite a few people predicted the secular trough
(including me, in case you're wondering), but the earliest you're
likely to be able to find in writing is PIMCO's 1999 secular forecast.
Inside that, you have had monster deficits combined with a steady diet
of liquidity and constraints on consumer price inflation, aggressive
economic stimulus, and ongoing tax subsidies for real estate (health
care too, but that's another problem), US-China foreign policy, and a
tax cut during an off-budget, largely unilateral war.
Inside that, you have the highly uneven rubric of bank regulation
combined with huge pools of largely unregulated money. To that, you
could add that the commoditization of financial services resulted in a
broad brain drain from Wall Street toward higher-margin, less
regulated enterprises like hedge funds, i.e., Wall Street is dumber
today than it was when some of those sexy debt vehicles (they're
called 'first-to-fail vehicles for a reason) and their derivatives
were created. Add to that, the incremental deregulation of financial
institutions (something we've known is dangerous since the Middle
Ages).
There are some other factors, as well. For example, several years of
declining harvests left food supplies tight. The Bear and Lehman
failures were poorly handled. Nevertheless, the main causes are
secular and mismanagement of fiscal policy. Ultimately, it is very
difficult to trade in a bubble. Keep in mind that economic agents lack
perfect foresight and that they react to current conditions. Also,
psychologically it is very difficult for people to trade against a
bubble, even if they know that they're in one.
Further, it's hard to move out of the way fast enough. Hypothetically,
if you were the chairman of a major asset allocation committee and you
announced that the tech bubble was over in April 2000, it would still
take several months for the ship to start turning. Likewise, if you
correctly predicted the Russian default in the summer of 1998, the
events would bypass you before you ever got the ship moving. As a
regulatory matter, the financial system must be designed to hit
icebergs; it isn't going to miss any. Ultimately, the market is an
average and I think we understand that everyone can't be above
average.
By the way, if you wanted to, you could also wrap the whole Christmas
package in the available patchwork of geologic, climatic, and
ecological science/history. Human technology may be able to shift some
boundary conditions, but it's very difficult and costly to react
instantly to the underproduction of commodities like food or oil. At
some point (or historical points, if you like) man is no better than a
smear on a petri dish.
Vend
> Vend <ven...@virgilio.it> wrote in news:78180acb-0dde-469f-ae6b-
>
> > On 23 Gen, 23:51, bpuharic <w...@comcast.net> wrote:
> >> Why did most of the world's top economists fail to
> >> forecast the financial crisis?
>
> > I'm no world's top economist, but I don't think that the world
> > economic crisis was so difficult to forecast:
>
> > growing population + growing percentage of industrialized population +
> > growing income inequality + decreasing natural resources = ?
>
> + human race under the sway of bogus ethic that the purpose of life is to
> produce and consume material goods for sense gratification...
>
> = society of two-legged beasts.
Correct.
Vend
> On Sat, 23 Jan 2010 15:43:59 -0800 (PST), Vend <ven...@virgilio.it>
> wrote:
>
> >> Why did most of the world's top economists fail to
> >> forecast the financial crisis?
>
> >I'm no world's top economist, but I don't think that the world
> >economic crisis was so difficult to forecast:
>
> >growing population + growing percentage of industrialized population +
> >growing income inequality + decreasing natural resources = ?
>
> pure and simple
Humans are always been greedy. That isn't an explanation.
> the CDO's, the swaps, etc...wall street invented new financial
> instruments and they spun out of control.
Why?
Vend
> On Sun, 24 Jan 2010 03:31:46 +0000 (UTC), Kalkidas <e...@joes.pub>
> wrote:
>
>
>
> >Vend <ven...@virgilio.it> wrote in news:78180acb-0dde-469f-ae6b-
>
> >> On 23 Gen, 23:51, bpuharic <w...@comcast.net> wrote:
> >>> Why did most of the world's top economists fail to
> >>> forecast the financial crisis?
>
> >> I'm no world's top economist, but I don't think that the world
> >> economic crisis was so difficult to forecast:
>
> >> growing population + growing percentage of industrialized population +
> >> growing income inequality + decreasing natural resources = ?
>
> >+ human race under the sway of bogus ethic that the purpose of life is to
> >produce and consume material goods for sense gratification...
>
> >= society of two-legged beasts.
>
> one can only wonder where 'kalkidas' draws the conclusion that most
> people think this way.
Well, I think it is quite clear that most goods produced by modern
economy are made to satisfy artificially created needs.
Mitchell Coffey
You might start here:
http://www.nytimes.com/2009/09/06/magazine/06Economic-t.html
I might quibble with Bpuharic's use of the word "caused," but beyond
that his analysis is as far as I know correct. I'd be interested in
exactly what he wrote that you consider untrue and why.
Mitchell Coffey
James Beck
Not quite true. The SEC filed against AIG in 2005 (along with about
22? other plaintiffs). AIG appears to have been engaging in some shady
accounting practices to increase the level of its loss reserves. I'd
have to dig into their books, but that appears to have been necessary
because they were insuring too many liabilities.
The total settlement amount was $1.6 billion. In addition, AIG was
forced to replace its CEO and CFO, tighten up its internal code of
conduct, create a independent legal and regulator oversight committee
and take steps to increase transparency. The troubles at AIG were a
major factor in Congressional resistance to the bailout.
Vend
wrote:
> Vend wrote:
> > On 23 Gen, 23:51, bpuharic <w...@comcast.net> wrote:
> >> Why did most of the world's top economists fail to
> >> forecast the financial crisis?
>
> > I'm no world's top economist, but I don't think that the world
> > economic crisis was so difficult to forecast:
>
> > growing population + growing percentage of industrialized population +
> > growing income inequality + decreasing natural resources = ?
>
> These factors had nothing to do with the 2007-09 crisis and subsquent
> recession.
>
> The theory that the free market is a solution to all our economic woes is
> based on the [false] assumption that the decisions are rationally based on
> correct and full information available to all (the reason why insider
> dealing is a crime).
Right.
> This was massively violated in the race to create all sorts of derivative
> securities out of mortgage loans that turned out to have been made to very
> doubtful customers. �Those buying such securities, often repackaged at
> second or third remove, had no clear idea of the true risks, nor did the
> companies such as AIG who routinely insured them by providing credit ratings
> for the bonds.
Ok. But I'm skeptical about the notion that financial crises can cause
economic crises alone.
I think that during the last decade or so, the effective purchase
power of the salary of an average person in developed countries
decreased, due to the issues I mentioned and the moving of jobs to
developing countries (goods can freely cross the borders, but workers
can't, so production moves where labor costs less).
For some years, the financial system masked this purchase power loss
by providing a large amount of credit, using ill-regulated securities
like derivatives, which hid the actual risks.
This became a Ponzi/Pyramidal scheme, where wealthy people were
lending their money to average people, in order to buy products
produced by the same wealthy people, so eventually the system
collapsed.
Without easy access to credit, common people were forced to buy less,
so there was a sudden overproduction and consequently job loss.
> If you look at China, all your above factors should be causing the country
> to collapse but in fact it is the most rapidly growing economy in the world.
China is developing so fast because its labor costs much less than in
developed countries, both in terms of salary and in terms of worker
rights.
But labor cost is increasing in China and other developing countries,
and I suppose it's falling in developed countries. Possibly they will
become approximately equal, and then the economies will be similar.
el cid
> On Sat, 23 Jan 2010 21:29:45 -0800 (PST), el cid
My objection to your analysis is that it mostly skates past the
foundations of value (excepting your comments on food supplies).
I believe in a mostly zero sum game. Too few economic analyses
refer to the first law of thermodynamics. One can constipate or
relax the economy in various ways to retard or improve efficiencies.
Your macro analysis touches on that well enough. But at some point,
the ties to real value are real and will rear their heads. Deficit
spending, whether by governments, corporations or individuals
will manufacture bubbles. Trade deficits will manufacture bubbles.
Aggregated, unrealistic expectations create bubbles. And lastly,
all the talk about discouraging 'risky' behavior skates past the
key point --- unrealistic expectations. Our financial institutions
are effectively crafted to cater to a 'the sky is the limit'
fantasy of eternal growth which is sustained by the same basic
human failing that leads people to fall, again and again, for
ponzi schemes.
Still not full on ranting but annoyingly preachy nevertheless.
Free Lunch
wrote in talk.origins:
But they also had a whole bunch of unregulated non-insurance-company
speculation that pulled them down. Thank Congress for destroying the
state regulation that had kept companies from getting involved in that
speculation until the 'modernization' of regulation.
JTEM
bpuharic <w...@comcast.net> wrote:
> go read about adaptive market theory
Go read anything on Peak Oil.
Seriously, it really isn't a coincidence that this is coming
at a time when the planet just can't produce more & more oil
to feed economic growth.
JTEM
"Stephen" <ssan...@austin.rr.com> wrote:
> If you think it's utter bullshit, how 'bout providing
> the detailed analysis as to why?
I have, Peak Oil.
And this is nothing new. It's been talked about (including
by me) for years.
JTEM
Paul J Gans <gan...@panix.com> wrote:
> There was no regulation of these markets at all.
> There were calls for regulation, but (and you
> can google for this) the response was that our
> "free market" system was working just fine.
It was no different with the dot-com scam, or with the
S&L crisis... or Enron for that matter, or even MCI.
Neil Bush took the tax payers for a billion dollars with
the Silverado S&L, and that was only 1/500th of the cost
to the the U.S. treasury. Nobody so much as blinked until
AFTER the crisis hit.
But it's different now. It's a lot different now. Even if
all of the west remains in economic stagnation for the
next 50 years, there just won't be enough oil to go around.
There can't be. China & India are growing, but the planet's
oil production can't grow enough to cover their new "Needs."
JTEM
Mitchell Coffey <m.cof...@starpower.net> wrote:
> You might start here:
>
> http://www.nytimes.com/2009/09/06/magazine/06Economic-t.html
Okay, fine. It's a story that believes economists run our
economy.
They don't. At best they advise. At best. At the absolute very
best.
bpuharic
wrote:
>
where did you get the idea the only source of energy is oil?
and, this has nothing to do with efficient market theory
IOW you're full of shit.
James Beck
Well... it's not like I was making a case for value investing and you
can do whatever you like with the hypothetical ecological constraints,
but "the first law of thermodynamics?" It makes you sound kind of
kooky.
Now, some of the math associated with the second law can be massaged
to give you a sort of pseudo economic model. Economists are used to
sponging off of physics anyway. Irving Fisher's quantity theory of
money is just the ideal gas law and the Black-Scholes option pricing
model is just the heat transfer equation, to name a couple. Neither
one works all that well empirically, but they're okay for teaching.
Periodically (usually when there aren't enough jobs in their
respective fields), physicists, astronomers & the like poke around in
econ. The latest wave of that got started about 5-10 years ago, so far
be it from me to discourage you. If it interests you, go and enjoy.
Paul J Gans
What you seem to be saying is that if the economy did not
collapse in one area, it certainly would have done so in
another.
You also mention that tax increases almost gave Bush I a
balanced budget. Clinton had several budget surpluses. Do
those count?
I think that your analysis is ok on a global basis. But it
omits one very important point. The housing situation was
not a bubble. It was a Ponzi scheme, doomed from the start.
The entire thing was based on the notion that housing prices
would always go up. It was fueled by unsophisticated buyers
(and some sophisticated ones) who were urged on by banks and
mortgage lenders who actually lied to the potential buyers
by concealing the risk involved.
While all those other things you listed may be true, the
immediate cause of the bank "failures", the investment house
"failures" and the AIG "failure" was the onset of the mass
of mortgage defaults.
That is what is mainly driving the current depression. There
are more folks with mortgages in trouble NOW than there were
last year. Jobs are not appearing. Real wages (except in
certain select industries) are dropping, and we are waging
two wars off the books.
There's more, but that alone will do us in.
We are a far poorer nation than we were 20 years ago. We need
to raise taxes and raise government spending even more. Most
folks will have much reduced discretionary funds. That's a
reality now, though it isn't yet totally obious.
We can't wait for "nature" to take its course. If we try we will
find that nationals of other nations will have bought up what assets
remain in the US.
We also need to pull out of Iraq and Afghanistan NOW.
And we need a Constitutional change to allow majority rule in
the Congress of the US.
If we do not do those things (and others) we are facing a frozen
government, financial collapse, and a depression that will last
20 years.
Paul J Gans
What has that got to do with anything? They were *already*
technically bankrupt at that point in time, but the SEC either
did not care or had no jurisdiction.
el cid
It can't make sense to have median housing prices 8X median
annual household incomes. Leveraged investments are always
the culprit. When housing prices go up because housing prices
have been going up, you know you've past the tipping point.
> The entire thing was based on the notion that housing prices
> would always go up. �It was fueled by unsophisticated buyers
> (and some sophisticated ones) who were urged on by banks and
> mortgage lenders who actually lied to the potential buyers
> by concealing the risk involved.
>
> While all those other things you listed may be true, the
> immediate cause of the bank "failures", the investment house
> "failures" and the AIG "failure" was the onset of the mass
> of mortgage defaults.
>
> That is what is mainly driving the current depression. �There
> are more folks with mortgages in trouble NOW than there were
> last year. �Jobs are not appearing. �Real wages (except in
> certain select industries) are dropping, and we are waging
> two wars off the books.
>
> There's more, but that alone will do us in. �
>
> We are a far poorer nation than we were 20 years ago. �We need
> to raise taxes and raise government spending even more. �Most
> folks will have much reduced discretionary funds. �That's a
> reality now, though it isn't yet totally obious.
>
> We can't wait for "nature" to take its course. �If we try we will
> find that nationals of other nations will have bought up what assets
> remain in the US.
>
> We also need to pull out of Iraq and Afghanistan NOW.
I was with you until then.
We made some messes, we need to clean them up or they will
come back and bite us in the ass.
The Iraq withdraw need to continue, especially corporate
withdraw.
Afghanistan needs a policy change to get an alternative
populist movement going. In reality, this will have to
be driven by tribal leaders and will lead to some level
of civil war. But we can't install a government that
will survive. Afghans need to do that. We can choose
somewhat in which groups get to try but we need to
foster some level of internal revolution that is neither
Taliban nor the current bureaucratic thieves.
Paul J Gans
>Mitchell Coffey <m.cof...@starpower.net> wrote:
To the extent that the Fed runs our economy, economists, or
rather an economist, runs the economy.
Paul J Gans
That is so wrong. Five or ten years agon $BIGBANKS were hounding
physics and chemistry departments attempting to hire new PhD's.
They were interested in folks who could do math. Those folks
are the ones who coded up the programs as dictated by the economics.
They certainly didn't do much in the way of economics.
James Beck
<gan...@panix.com> wrote:
You may mean something by this that I'm not following. It is simply
not the case that there were no regulations against AIG's behavior.
The rules are old and have been around a long, long time.
The SEC went after AIG under the existing regulatory framework. It was
very effective. AIG was technically insolvent in 2000-2001 when the
fraud occurred. It was not technically insolvent in 2005-2006 when the
litigation was filed and the settlement occurred. As far as I know, no
one outside AIG knew that the corporation had been technically
insolvent in 2000-2001 until 2005, when the fraud was uncovered. The
SEC action forced them to disgorge the ill-gotten gains from the
fraud.
By the way, AIG would be a good counterexample on the 'hiding money
offshore' thread. ;>)
Paul J Gans
If we *can* clean them up. There is no guarantee.
>The Iraq withdraw need to continue, especially corporate
>withdraw.
Yes.
>Afghanistan needs a policy change to get an alternative
>populist movement going. In reality, this will have to
>be driven by tribal leaders and will lead to some level
>of civil war. But we can't install a government that
>will survive. Afghans need to do that. We can choose
>somewhat in which groups get to try but we need to
>foster some level of internal revolution that is neither
>Taliban nor the current bureaucratic thieves.
The Taliban will probably have to be involved in some
sort of unity government. What we need to do is to
separate the Taliban from al Qaeda. Actually, the
Taliban's interests don't extend much beyond Afghanistan
and so they are not al Qaeda's natural allies. Of so
it seems to me anyway.
el cid
> el cid <elcidbi...@gmail.com> wrote:
> >On Jan 24, 8:32�ｿｽpm, Paul J Gans <gan...@panix.com> wrote:
> >> We are a far poorer nation than we were 20 years ago. �ｿｽWe need
> >> to raise taxes and raise government spending even more. �ｿｽMost
> >> folks will have much reduced discretionary funds. �ｿｽThat's a
> >> reality now, though it isn't yet totally obious.
>
> >> find that nationals of other nations will have bought up what assets
> >> remain in the US.
>
> >> We also need to pull out of Iraq and Afghanistan NOW.
> >I was with you until then.
> >We made some messes, we need to clean them up or they will
> >come back and bite us in the ass.
>
>
> >The Iraq withdraw need to continue, especially corporate
> >withdraw.
>
> Yes.
>
> >Afghanistan needs a policy change to get an alternative
> >populist movement going. In reality, this will have to
> >be driven by tribal leaders and will lead to some level
> >of civil war. But we can't install a government that
> >will survive. Afghans need to do that. We can choose
> >somewhat in which groups get to try but we need to
> >foster some level of internal revolution that is neither
> >Taliban nor the current bureaucratic thieves.
>
> The Taliban will probably have to be involved in some
> separate the Taliban from al Qaeda. �ｿｽActually, the
> Taliban's interests don't extend much beyond Afghanistan
> it seems to me anyway.
I remain leery of the Taliban or any such fundamentalist
government. The Taliban are fundamentally totalitarians
at heart. Much of tribal Afghanistan is more rooted in
traders of a past era. Afghanistan remains a strong
candidate to be part of a geopolitically significant
cross-roads. The key is to outspend al Qaeda but not
with bullets and foot soldiers, theirs come much cheaper
than ours. ___I_F___ we can find channels to fund
reconstruction that do not feed the current institutional
corruption, and I think that means diversified funding
to tribal entities, it might work. We can't tie it
as closely to western reforms as we want. I'd love to see
female children in Afghanistan get equal access to education
but it won't happen by our dictating our cultural values.
That level of evangelizing simply doesn't work, no matter
how morally righteous it may be.
And I think we'll find it's cheaper to subsidize locals
to build roads than it is to send our own troups. We
can also train their soldiers for local security forces.
But our military doesn't like that way because we're stuck
with this Great White Father complex. Not sure how to
fix that.
James Beck
<gan...@panix.com> wrote:
That was particularly true in the late 1980s and early 1990s. The view
was that it would be easier to teach a physicist finance than to teach
a finance grad math. Even 10-15 years ago it was still true to some
extent. By 2002-2004? Nope. They were laying off or forcing out the
big brains to cut payroll. Though there are still some, you'll find
most of those people at hedge funds today because the margins are
still decent. Fees on traditional asset management have fallen
precipitously. A brokerage that might have made 135 basis points (bp,
1.35%) on assets in the late 1990s might make 10 bp on those assets
today. That's mostly a consequence of diffusion of technology and the
resulting commoditization of traditional asset management. That
process was well underway by the late 1990s.
Currently, financial services ranks fairly low on the list of
desirable careers. During the blowout beginning in 2007, another wave
of star managers left Wall Street, joined existing hedge funds or
started their own. PhDs are often used to create intellectual
property, but they don't usually get to control what they created.
Once it's created and more or less automated, it's commonly maintained
and traded by MBAs and let's just say that most of them can't do much
math.
Besides which, financial services isn't econ anyway. If you're
actually interested you can follow the recent wave by googling
"Econophysics."
Steven L.
news:f5vml5583infk8gh1...@4ax.com:
> with the collapse of the idea of the efficiency of the 'free market',
> many economists are trying to integrate the ideas of evolutionary
> biology into their subject (i avoid calling economics a 'science'):
>
> http://www.newsweek.com/id/232111
>
> in Atlanta earlier this month, the annual meeting of the American
> Economic Association was home to more soul-searching than number
> crunching. Hundreds of the profession's most eminent thinkers turned
> out to hear panel after panel discuss how, exactly, they'd gotten
> things so wrong. Why did most of the world's top economists fail to
> forecast the financial crisis?
Because a basic assumption of all these models is that the actors are
honest--following the rules of the game as modeled by these economists.
Obviously Al Capone and Don Corleone didn't follow the law of supply and
demand. They just bumped off their competitors, even if their
competitors' products were better and cheaper.
And a number of the key actors in the 2008 financial crisis were plain
dishonest too.
Investors in those securitized mortgages depended on the rating
agencies, like Moody's, to rate the instruments for safety. But Moody's
and Standard & Poor's were paid by the *issuers* of those instruments to
rate them--a clear conflict of interest.
Even worse, Moody's engaged in actual payola. When one issuer decided to
take his business elsewhere, Moody's deliberately downrated that
issuer's bonds in revenge. So you had a genuine "pay to play" scheme.
This is not a new problem.
Prior to this latest financial crisis, the CEOs of Enron had made a
fortune on Enron stock options. They knew their company was a hollow
shell ripe for collapse. But they never told the workers of Enron, even
though those workers had been given Enron stock in their retirement
plans. Indeed, the workers of Enron, by investing in company stock, had
helped sustain the stock price long after Enron's financial status had
turned poor.
Some of Commodore Vanderbilt's competitors in the railroad business made
plenty of money issuing worthless counterfeit stock certificates. But
Commodore Vanderbilt, unlike some blue-collar worker with a 401(k) plan,
had sufficient funds to ride through the market crashes caused by such
illegal manipulations.
--
--
Steven L.
sdli...@earthlinkNOSPAM.net
Remove the "NOSPAM" before sending to this email address.
James Beck
Not exactly. The combination of Bush I's and Clinton's tax increases
gave Clinton nearly balanced budgets. The net debt did decrease under
Clinton. The gross debt did not. The 'surplus' was a fiction, albeit a
minor one. The smallest dollar increase in the gross debt was between
1997 and 1998 (about $109 billion). The net debt declined because the
value of assets held by the US government appreciated. The ratio of
net debt to real GDP fell very sharply.
>I think that your analysis is ok on a global basis. But it
>omits one very important point. The housing situation was
>not a bubble. It was a Ponzi scheme, doomed from the start.
If you're going to toss around terms like 'Ponzi scheme' you should at
least try to find out what one is. Here's a hint: This ain't it.
>The entire thing was based on the notion that housing prices
>would always go up. It was fueled by unsophisticated buyers
>(and some sophisticated ones) who were urged on by banks and
>mortgage lenders who actually lied to the potential buyers
>by concealing the risk involved.
That's not entirely wrong, but it's a bit superficial. Anyone
interested can read the interim report to the Congress on the subprime
problem and the Bush Treasury's white paper on bank regulation. If you
find the full papers too long, the summaries are pretty good.
If you enjoy such things, banking offers an interesting game of 'spot
the loophole.' Technically, the OCC regulates the major commercial
banks under the National Bank Act, though federalism isn't uniformly
applied. For example, OCC ignored complaints about subprime from the
states' attorneys general and took only one enforcement action related
to subprime over 2000 through 2006. OCC claimed that it had no
evidence that "national banks are engaged in predatory and abusive
lending practices to any discernable degree." Strictly speaking, that
claim was likely true.
OCC, OTS and the states seem to have run a race to the bottom with the
banks for which entity would regulate them. The various banking
entities organized themselves to get the most attractive set of
regulations. So, � you have subsidiaries of the major commercial banks
that are organized under a different set of regulatory controls from
their parent corporations. Add to that the mortgage bankers, most of
which don't come under the National Bank Act. OTOH, it would be overly
simplistic to say that that implies a failure of local regulation,
because OCC apparently interfered in local regulation in what seems to
have been an ambitious reach for greater jurisdiction. That seems
consistent with the Bush administration's MO. Any way you look at it,
the patchwork of regulation let some bad loans into the pipeline.
Local regulatory failure appears to have been the main cause of the
problems in subprime.
Contrary to the spin, default rates among borrowers who received home
loans under the provisions of CRA appear to have been exceptionally
low (that is, those "unsophisticated" borrowers you mentioned"). Both
the rules they face and the process they go through to get qualified
are fairly tight. On average economic behavior tends to reflect
whatever the rules are. If, when the tide rolls out you find a lot of
people swimming naked, you are usually safe guessing that they were
following the rules as they saw them at the time. That's not to say
that there was any shortage of petty frauds and some serious ones, but
it can be quite difficult to distinguish between outright fraud and
behavior that falls within the rules, but reflects questionable
expectations.
>While all those other things you listed may be true, the
>immediate cause of the bank "failures", the investment house
>"failures" and the AIG "failure" was the onset of the mass
>of mortgage defaults.
No. The immediate cause was the rapid decline in market value. That
created huge amounts of negative equity in the housing markets and
subprime (and some fixed rate traditional) borrowers began to walk
away from their mortgages in the interest of their own long-term
financial health. Negative equity is an ongoing problem. Existing
federal programs have been reasonably successful at getting payments
reduced, but to the extent that they don't deal with negative equity,
they are probably doomed to fail.
>That is what is mainly driving the current depression. There
>are more folks with mortgages in trouble NOW than there were
>last year. Jobs are not appearing. Real wages (except in
>certain select industries) are dropping, and we are waging
>two wars off the books.
On the other hand, as I said last spring, the stock market exploded
upward and unemployment probably peaked around Christmas. We'll have
to see about that one, though. Historically unemployment continues to
rise for about 18 months after a recession/depression ends. That
occurred over the summer, also as predicted.
The massive deficits we have run already combined with the two off
budget wars and Chinese decision to re-peg to the dollar have set the
stage for another monster equity bubble. Our policy makers are likely
hoping that that will alleviate the negative equity problem.
Meanwhile, global demographics should start pushing us out of the
current secular trough.
>There's more, but that alone will do us in.
>
>We are a far poorer nation than we were 20 years ago. We need
>to raise taxes and raise government spending even more. Most
>folks will have much reduced discretionary funds. That's a
>reality now, though it isn't yet totally obious.
Which taxes? Personally, I would probably eliminate income taxes on
the bottom quartile of incomes (and give them a substantial earned
income tax credit; their GDP multiplier is the highest), cut them on
the middle two quartiles, raise them a little on the next 20% of the
population and increase them sharply on the top 5% of incomes. The
estate tax should be renewed; it's due to expire and expiration would
cripple the non-profits. I would probably also reinstate the capital
gains tax at the rate of ordinary income subject to a hurdle, i.e.,
you can trade as much as you want, but if you fail to outperform the
S&P 500 after transactions costs, fees and imputed taxes, you pay the
higher rate. Might as well clear out some of the untalented managers
while we're at it.
A lot of that will happen without a political battle when the Bush tax
cuts expire, by the way. My guess is that they'll wait until then.
>We can't wait for "nature" to take its course. If we try we will
>find that nationals of other nations will have bought up what assets
>remain in the US.
Even together they don't have enough money and they have their own
troubles to deal with. Don't be hysterical.
>We also need to pull out of Iraq and Afghanistan NOW.
Maybe. It's hard to guess what the consequences will be. Did you ever
suggest looking for a way to detect the leading edge of a minefield to
your students? Getting rid of the mines is still the cheapest way to
actually *fix* Afghanistan.
>And we need a Constitutional change to allow majority rule in
>the Congress of the US.
You already have that. What you probably mean is that you want a
Constitutional amendment to make a simple majority filibuster-proof
(force cloture) or amend the Constitution. I'm not sure that either is
a good idea. If you can't get 60 Senators to vote for something, it's
probably not a very good idea.
President Obama should have waited on healthcare until 2011. It would
have been easier with full coffers and they might have gone with a
better idea than the proposed disaster. You probably won't like it if
you get it.
>If we do not do those things (and others) we are facing a frozen
>government, financial collapse, and a depression that will last
>20 years.
That is extremely unlikely.
JTEM
bpuharic <w...@comcast.net> wrote:
> where did you get the idea the only source of
> energy is oil?
Please tell me that you're kidding. You are, right?
Go on, jackass, tell us which form of energy is
making up the difference.
JTEM
Paul J Gans <gan...@panix.com> wrote:
> To the extent that the Fed runs our economy,
> economists, or rather an economist, runs the
> economy.
The feds have had little or no input since Clinton.
Clinton: "What do I need to do for you to lower
interest rates?"
Bush: "Keep interest rates that low, below inflation,
despite my doing the opposite of what you told Clinton
to do."
bpuharic
wrote:
>
ROFLMAO!!! at one time people had your ideas about whale oil, too.
Mitchell Coffey
Furthermore, (1) a school of economic thought, arguing that markets
guaranteed that asset prices would always nearly reflect their real
value, gave cover to industry deregulation, and informed the decisions
of government and industry policy makers; and (2) the new financial
instruments that have proven so disastrous were not possible without
use of related theories and related practical mathematical devices.
That said, JTEM's response was only dustily related to my post.
Mitchell Coffey
Mitchell Coffey
Well done. These are accurate characterization of the relationship of
those respective administrations to the Fed. What is odd is that
you,, accurately, show both Presidents turning macroeconomic policy
over to the Fed, limiting their role to negotiating with the Fed over
general policy goals. This is rather the opposite to your claim,
above, that "The feds have had little or no input since Clinton."
To clarify a bit, the Bush Administration was much more independent
regarding the Fed than was Clinton; Bush was going to cut income taxes
whatever Greenspan's opinion was.
Mitchell Coffey
Paul J Gans
>> >> We are a far poorer nation than we were 20 years ago. We need
>> >> to raise taxes and raise government spending even more. Most
>> >> folks will have much reduced discretionary funds. That's a
>> >> reality now, though it isn't yet totally obious.
>>
>> >> find that nationals of other nations will have bought up what assets
>> >> remain in the US.
>>
>> >> We also need to pull out of Iraq and Afghanistan NOW.
>> >I was with you until then.
>> >We made some messes, we need to clean them up or they will
>> >come back and bite us in the ass.
>>
>>
>> >The Iraq withdraw need to continue, especially corporate
>> >withdraw.
>>
>> Yes.
>>
>> >Afghanistan needs a policy change to get an alternative
>> >populist movement going. In reality, this will have to
>> >be driven by tribal leaders and will lead to some level
>> >of civil war. But we can't install a government that
>> >will survive. Afghans need to do that. We can choose
>> >somewhat in which groups get to try but we need to
>> >foster some level of internal revolution that is neither
>> >Taliban nor the current bureaucratic thieves.
>>
>> The Taliban will probably have to be involved in some
>> separate the Taliban from al Qaeda. Actually, the
>> Taliban's interests don't extend much beyond Afghanistan
>> it seems to me anyway.
>I remain leery of the Taliban or any such fundamentalist
>government. The Taliban are fundamentally totalitarians
>at heart. Much of tribal Afghanistan is more rooted in
>traders of a past era. Afghanistan remains a strong
>candidate to be part of a geopolitically significant
>cross-roads. The key is to outspend al Qaeda but not
>with bullets and foot soldiers, theirs come much cheaper
>than ours. ___I_F___ we can find channels to fund
>reconstruction that do not feed the current institutional
>corruption, and I think that means diversified funding
>to tribal entities, it might work. We can't tie it
>as closely to western reforms as we want. I'd love to see
>female children in Afghanistan get equal access to education
>but it won't happen by our dictating our cultural values.
>That level of evangelizing simply doesn't work, no matter
>how morally righteous it may be.
>And I think we'll find it's cheaper to subsidize locals
>to build roads than it is to send our own troups. We
>can also train their soldiers for local security forces.
>But our military doesn't like that way because we're stuck
>with this Great White Father complex. Not sure how to
>fix that.
I agree with your feelings. But I can not think of a
successful effort to pull a nation, kicking and screaming,
into the 21st century. I don't think it has a chance without
the full and corruption free cooperation of the government
of Afghanistan and that ain't happening. And all this would
have to be done in the face of armed opposition willing to
blow up schools, dams, roads, etc., as fast as we build them.
And blowing them up is cheap.
We can't even fix Haiti, which is smaller in size and population,
right next door, and predisposed to wanting to be fixed.
So while I agree, as a practical matter I'd try to work out
some compromise with the Taliban and pull out.
As for Iraq, that's a dead issue. The situation there is
deteriorating but since few if any Americans are being killed,
it doesn't make the news here. If we pulled out, would the
Iraqis notice?
Paul J Gans
Of course. Economic theory dominates the activities of large
corporations who keep a number of economists on payroll just
because of that.
For example the notion of "too big to fail" is an economic theory
that has never been tested in practice. It may even be right,
but we don't *know* that.
Mitchell Coffey
>
>
>
> <elcidbi...@gmail.com> wrote:
> >On Jan 23, 10:53�pm, Paul J Gans <gan...@panix.com> wrote:
> >> bpuharic <w...@comcast.net> wrote:
> >> >On Sat, 23 Jan 2010 16:49:08 -0800 (PST), chris thompson
> >> ><chris.linthomp...@gmail.com> wrote:
> >> >>On Jan 23, 6:50�pm, bpuharic <w...@comcast.net> wrote:
> >> >>> On Sat, 23 Jan 2010 15:43:59 -0800 (PST), Vend <ven...@virgilio.it>
> >> >>> wrote:
>
> >> >>> >On 23 Gen, 23:51, bpuharic <w...@comcast.net> wrote:
> >> >>> >> forecast the financial crisis?
>
> past the superficial press reports and toward a plausible story, but
> you didn't take it back far enough in time.
>
> There were several (recent) causes. The one you're most likely to see
> eventually is that the banks were over-regulated relative to other
> financial entities. Note: that does not mean that banks were
> over-regulated. If you squeeze the balloon in one place, it pops out
> in another. Enormous pools of money have been largely unregulated,
> e.g., hedge funds. It would be hard to deny that the opportunities in
> real estate were very profitable. Profits attract both investors and
> speculators.
"If you squeeze the balloon in one place, it pops out in another."
How would this be the case if the Fed tightens back on liquidity?
Another way to ask my question would be, what exactly do you mean?
> OTOH, like most of the spin on both sides, that tells you a bit about
> what happened, but not much about why. Here's a plausible story:
> Whether the federal government taxes and spends (Democrats) or borrows
> and spends (Republicans), when the government fails to meet its budget
> constraint (runs deficits), you get inflation.
No, you don't: except possibly in the very short run, deficits don't
cause inflation, unless the Fed is simultaneously keeping up with an
inflationary monetary policy, and if the economy's capacity
utilization is rather tight; and in this case it's probably better to
say that the monetary policy is responsible for the inflation.
> Since Paul Volcker, the
> Fed has been careful to control consumer price inflation, but that
> doesn't mean that the money went away. Instead, it has been showing up
> in equity (stocks/real estate) price bubbles.
Why doesn't it mean that the money went away? That's pretty much what
the Fed has been doing since Volcker, not making the money go away,
but preventing it from growing fast enough to get price inflation out
of control; that what one does when one is being "careful to control
consumer price inflation."
> Although Bush Sr. was excoriated for doing it, his tax increase is
> widely thought to have headed off an earlier equity market bubble. It
> also resulted in a nearly balanced budget. On the other hand, cutting
> off that bubble may have contributed to the later problems in Japan.
> The response to that was an increase in liquidity and stimulation of
> the US economy to consume Japan's inventory overhang. That in turn led
> to currency bubbles and the emerging markets collapse in 1998. The
> response was again, more liquidity and stimulation of the US economy
> to consume the emerging markets' inventory overhang. That further
> puffed up the tech bubble that ended in 2000-still more liquidity.
> Off-budget war combined with a tax cut? The expected bubble didn't
> disappoint. ...
Though the Fed did disappoint to some extent, failing to pinch off
that bubble before it lost some people a lot of money; but more
importantly, the Fed did not disappoint and did pinch it off before it
lead to a near financial collapse of the sort it failed to get a
handle on in '08.
But, returning to the issue, liquidity isn't Godzilla, once allowed to
get out of hand it doesn't inevitably lead to general destruction. In
post war years we've had a pretty good record to keeping this sort of
thing from happening. We should look for reasons the Fed happened not
to, this particular time.
> Why real estate? Two main factors (recently. This problem dates back
> to when they broke the tax code in the early 1900s). China pegged the
> yuan to the dollar at a low level. That heavily stimulated its exports
> to the US. To maintain the peg they bought US assets. They started to
> taper off their buying in early 2005. Under heavy pressure from the US
> that started several years earlier, they floated their currency in
> July 2005. That sequence coincides with the peak in US real estate
> prices. Likewise, demand for US equity by countries in the Middle East
> dropped off in mid-2005.
So, why real estate?
You write as if bubbles or excess liquidity conditions are like giant
physical masses of, well, stone or something that, once created,
cannot be destroyed before inflicting themselves upon the economy in a
destructive cataclysm of letting ones' metaphors drive ones economic
analysis.
Look, what you have here is pretty much a narrative of bad economic
stuff that happened over the last thirty years, and maybe a little bit
before. It doesn't particularly help because since WWII we'd done a
pretty good job of preventing the sort of financial collapses that
turn serious recessions into depressions worthy of the title "Great."
Prior to the 1930s financial collapses of some seriousness occurred
every 15 years or whatever. They don't so much any more. What I'm
saying is, we know how to handle these things, or did until recently.
The real issue is why discrete human beings with PhDs from really
impressive econ. departments, some of whom had written extensively on
the causes of The Great Depression, and who dominated Fed policy,
decided to do certain things and not to do certain things.
Mitchell Coffey
JTEM
bpuharic <w...@comcast.net> wrote:
> ROFLMAO!!! at one time people had your
> ideas about whale oil, too.
And, ROFLMA!!!, here we have this cite, (19th
century whaling as a model for oil depletion
and price volatility)
http://www.theoildrum.com/node/3960
I mean, ROFLMA!!!, here you are introducing
whale oil, thinking it somehow counters me,
me, when it fact you point me to a cite that
does a damn good job of illustrating what I
was saying!
ROFLMA!!!
Let's try to hold back the laughter just long
to read some of it, shall me?
: First of all, neither whale oil nor whale bone were
: so crucial for life in 19th century as crude oil is
: today for us. [...]
:
:
: [...] In comparison, crude oil is such a basic
: commodity in our world that it is not surprising
: that prices have risen so steeply. Airlines, for
: instance, have no choice in between collapsing and
: buying oil at any price.
ROTFLMAO!!! You're a complete shit head! A moron!
An idiot who can't help but say something retarded
every time he makes the mistake of posting!
ROTFLMAO!!!
JTEM
Mitchell Coffey <m.cof...@starpower.net> wrote:
> Well done. �These are accurate characterization
> of the relationship of those respective
> administrations to the Fed.
[Bows]
> What is odd is that you,, accurately, show both
> Presidents turning macroeconomic policy over to
> the Fed, limiting their role to negotiating with
> the Fed over general policy goals. �This is rather
> the opposite to your claim, above, that "The feds
> have had little or no input since Clinton."
There's no contradiction, as I described a post-Clinton
fed that simply did what the Whitehouse told it to do,
rather than one that guided the Whitehouse.
> To clarify a bit, the Bush Administration was much
> more independent regarding the Fed than was Clinton;
Bush was going to do what he wanted to do, despite the
best advice he was given.
> Bush was going to cut income taxes whatever
> Greenspan's opinion was.
Cut taxes, explode spending and keep interest rates
artificially low.
Mitchell Coffey
> Mitchell Coffey <m.cof...@starpower.net> wrote:
> > Well done. �These are accurate characterization
> > of the relationship of those respective
> > administrations to the Fed.
>
> [Bows]
>
> > What is odd is that you,, accurately, show both
> > Presidents turning macroeconomic policy over to
> > the Fed, limiting their role to negotiating with
> > the Fed over general policy goals. �This is rather
> > the opposite to your claim, above, that "The feds
> > have had little or no input since Clinton."
>
> There's no contradiction, as I described a post-Clinton
> fed that simply did what the Whitehouse told it to do,
> rather than one that guided the Whitehouse.
Fair enough, I misread where you wrote "since Clinton."
> > To clarify a bit, the Bush Administration was much
> > more independent regarding the Fed than was Clinton;
>
> Bush was going to do what he wanted to do, despite the
> best advice he was given.
>
> > Bush was going to cut income taxes whatever
> > Greenspan's opinion was.
>
> Cut taxes, explode spending and keep interest rates
> artificially low.
That too.
Mitchell Coffey
bpuharic
wrote:
>
> bpuharic <w...@comcast.net> wrote:
>
>> ROFLMAO!!! at one time people had your
>> ideas about whale oil, too.
>
>And, ROFLMA!!!, here we have this cite, (19th
>century whaling as a model for oil depletion
>and price volatility)
yeah. because every time one of you geniuses say this crap you're
proven wrong.
we were running out of oil 50 years ago. 40 years ago
this is just the latter day version of 'christ is coming tomorrow'
JTEM
bpuharic <w...@comcast.net> wrote:
> yeah. because every time one of
Wait a minute. What happened to the subject?
....just kind of gave up on trying to sound
reasonable, huh?
Well, like I said, it's all about "Peak Oil."
And here I bet you all thought that 2012 wasn't
really the end of the world. It is. We should
be stuck in "Peak Oil" by then.
None of the "Alternatives" kicked around is
capable of replacing what even a modest economic
growth would require, never mind an actual decline
in oil production.
bpuharic
wrote:
>
> bpuharic <w...@comcast.net> wrote:
>
>> yeah. because every time one of
>
>Wait a minute. What happened to the subject?
>
> ....just kind of gave up on trying to sound
>reasonable, huh?
2 possibilities:
-we dont run out of oil
-we do run out
if 1. then no problem
if 2, then no problem. we find something else to replace it. just as
we did whale oil
now, crawl back into your barrel
>
>Well, like I said, it's all about "Peak Oil."
>
>And here I bet you all thought that 2012 wasn't
>really the end of the world. It is. We should
>be stuck in "Peak Oil" by then.
ah well. sucks to be you
>
>None of the "Alternatives" kicked around is
>capable of replacing what even a modest economic
>growth would require, never mind an actual decline
>in oil production.
yeah. and in 1980 semiconductor engineers said silicon was dead and
this was the end of the computer chip as we knew it.
how's that work out?
Mike Lyle
[...]
>
> Look, what you have here is pretty much a narrative of bad economic
> stuff that happened over the last thirty years, and maybe a little bit
I'm reluctant to advertise Kipling as an authority on economics or
anything else, but sometimes he resonates:
"...
Then the Gods of the Market tumbled, and their smooth-tongued wizards
withdrew
And the hearts of the meanest were humbled and began to believe it was
true
That All is not Gold that Glitters, and Two and Two make Four
And the Gods of the Copybook Headings limped up to explain it once more.
As it will be in the future, it was at the birth of Man
There are only four things certain since Social Progress began.
That the Dog returns to his Vomit and the Sow returns to her Mire,
And the burnt Fool's bandaged finger goes wabbling back to the Fire;
And that after this is accomplished, and the brave new world begins
When all men are paid for existing and no man must pay for his sins,
As surely as Water will wet us, as surely as Fire will burn,
The Gods of the Copybook Headings with terror and slaughter return!"
--
Mike.
Paul J Gans
Thanks. We needed a good Kipple.
John Wilkins
<mike_l...@REMOVETHISyahoo.co.uk> wrote:
Actually, I would tend to recommend Kipling as an authority on quite a
lot. Especially the behaviour of human beings in positions of power.
John Wilkins
<gan...@panix.com> wrote:
I was Kipling in the sun one day
In the merry merry month of May...
JTEM
bpuharic <w...@comcast.net> wrote:
> 2 possibilities:
>
> -we dont run out of oil
> -we do run out
Not quite. We will definitely run out of oil, it's
only a matter of time. The real question is if, before
that arrives, we have...
-very little time
-a decent amount of time (maybe a decade)
Now, which one of these is the case I honestly
don't know for absolute certain. I do know that
several models place "Peak Oil" at around 2010,
which would mean we'd start feeling it, for sure,
maybe around 2012.
The variable that I __can't__ speak with even the
slightest bit of knowledge on: China & India.
In other words: How well did the models predict the
economic growth in these two giants?
> if 1. then no problem
>
> if 2, then no problem. we find something else to replace
> it. just as we did whale oil
You remind me of the famous advice on how to become rich
and famous...
"First, become very rich. Next, become famous."
As that was to subtle for you, let me spell it out: You're
a brainless simpleton.
Ken Shackleton
> �bpuharic <w...@comcast.net> wrote:
> > 2 possibilities:
>
> > -we dont run out of oil
> > -we do run out
>
> Not quite. We will definitely run out of oil, it's
> only a matter of time. The real question is if, before
> that arrives, we have...
>
> �-very little time
> �-a decent amount of time (maybe a decade)
>
> Now, which one of these is the case I honestly
> don't know for absolute certain. I do know that
> several models place "Peak Oil" at around 2010,
> which would mean we'd start feeling it, for sure,
> maybe around 2012.
>
> The variable that I __can't__ speak with even the
> slightest bit of knowledge on: �China & India.
>
> In other words: �How well did the models predict the
> economic growth in these two giants?
This is why I don't understand why there is not a lot more investment
in alternative energy technologies. The oil will definitely run out,
it's an issue of timing; and before that happens it will get very
expensive. If we have already developed viable alternatives, then we
can sell those technologies to other nations that have not.....if we
are last out of the gate, not only will we have to buy expensive oil,
we will also have to buy the alternative rather than sell it to
others.
bpuharic
wrote:
>
> bpuharic <w...@comcast.net> wrote:
>
>> 2 possibilities:
>>
>> -we dont run out of oil
>> -we do run out
>
>Not quite. We will definitely run out of oil, it's
>only a matter of time. The real question is if, before
>that arrives, we have...
well that depends. you do realize (i said humbly) that the geniuses
known as 'chemists' are working on ways to use bioprocesses to make
oil, right?
oh. you've never head of 'chemists'.
we chemists are shocked...
>
> -very little time
> -a decent amount of time (maybe a decade)
>
>Now, which one of these is the case I honestly
>don't know for absolute certain. I do know that
>several models place "Peak Oil" at around 2010,
>which would mean we'd start feeling it, for sure,
>maybe around 2012.
when in trouble
when in doubt
run in circles
scream and shout
>
>The variable that I __can't__ speak with even the
>slightest bit of knowledge on: China & India.
>
>In other words: How well did the models predict the
>economic growth in these two giants?
>
>> if 1. then no problem
>>
>> if 2, then no problem. we find something else to replace
>> it. just as we did whale oil
>
>You remind me of the famous advice on how to become rich
>and famous...
>
>"First, become very rich. Next, become famous."
>
>As that was to subtle for you, let me spell it out: You're
>a brainless simpleton.
and you remind me of the guy who said 'man will never fly'...
JTEM
bpuharic <w...@comcast.net> wrote:
> you do realize (i said humbly) that the
> geniuses known as 'chemists' are working
> on ways to use bioprocesses to make
> oil, right?
Well I do know that it took nature several
hundred million years to turn endless
acreage upon acreage into the fossil fuels
which we have managed to all but deplete in
about 100 years.
There simply isn't biomass enough. Period.
> oh. you've never head of 'chemists'.
Now my math really sucks, and you are so utterly
superior, so you help me out on this...
Let's say 400,000 cars driving 10,000 miles a
year, averaging 30MPG between highway & city
driving.
(and I'm serious about being bad a math. Not the
concepts, but I'm so damn sloppy...)
Anyhow, I figure that's 4,000,000,000 miles per
year... @ 30 MPG that's 133,333,333 gallons of
fuel... we get about 439 gallons of biofuel per
acre of corn... that would require 303,720.576
acres of corn... roughly 1/4th of the state of
Rhode Island.
Oh. All this wouldn't even cover the brand new
Camrys Toyota sold last year. We'd have to take
arable land equivalent to 1/4th the size of the
state of Rhode Island AWAY from food production,
and move it to energy production, just to cover
most of the fuel needs for the brand new Camrys
that Toyota sold last year... and we'd STILL
need to find fuel elsewhere.
Then we add all the other cars Toyota sold last
year... plus the Fords... the Chevys... the
Buicks... the Mercedes... etc, etc, etc...
The amount of arable land necessary JUST TO COVER
THE INCREASE IN DEMAND is __Staggering__, never
mind what it would take to cover a decrease in
oil production PLUS growth in demand.
> we chemists are shocked...
More like "fucked," if they think they're going
to replace crude oil with biomass...
JTEM
Ken Shackleton <ken.shackle...@shaw.ca> wrote:
> This is why I don't understand why there is not
> a lot more investment in alternative energy
> technologies.
Look at "bpuharic's" reply. Most of the word is
insane, believing that there isn't even a problem,
never mind work that needs to be done.
> The oil will definitely run out, it's an issue of
> timing; and before that happens it will get very
> expensive.
To me, the worst part is that it will not only get
more expensive, but production will start dropping
___Long___ before it drops out. So it's be a slow
death, where every year there will be more people,
but less oil. There will very quickly come a point
where the issue isn't price, it'll be availability.
You won't find fuel at any price.
bpuharic
wrote:
>
> Ken Shackleton <ken.shackle...@shaw.ca> wrote:
>
>> This is why I don't understand why there is not
>> a lot more investment in alternative energy
>> technologies.
>
>Look at "bpuharic's" reply. Most of the word is
>insane, believing that there isn't even a problem,
>never mind work that needs to be done.
and jtem's recipe?
when in trouble
when in doubt
run in circles
scream and shout
if i thought nothing needed to be done
i wouldnt be discussing alternative methods
but our resident 'chicken little' just has more fun wetting his
diapers than in thinking logically
>
>> The oil will definitely run out, it's an issue of
>> timing; and before that happens it will get very
>> expensive.
>
>To me, the worst part is that it will not only get
>more expensive, but production will start dropping
>___Long___ before it drops out. So it's be a slow
>death, where every year there will be more people,
>but less oil. There will very quickly come a point
>where the issue isn't price, it'll be availability.
>
>You won't find fuel at any price.
and man will never fly
>
>
bpuharic
wrote:
>
>bpuharic <w...@comcast.net> wrote:
>
>> you do realize (i said humbly) that the
>> geniuses known as 'chemists' are working
>> on ways to use bioprocesses to make
>> oil, right?
>
>Well I do know that it took nature several
>hundred million years to turn endless
>acreage upon acreage into the fossil fuels
>which we have managed to all but deplete in
>about 100 years.
now let's see. it took nature millions of years to make birds from
dinosaurs
so your argument is we had to wait millions of years to learn how to
fly??
that your argument?
we can't make oil faster 'cuz nature didn't make it that way?
you want organic oil? no fertilizers?
>
>There simply isn't biomass enough. Period.
>
>> oh. you've never head of 'chemists'.
>
>Now my math really sucks, and you are so utterly
>superior, so you help me out on this...
>
>Anyhow, I figure that's 4,000,000,000 miles per
>year... @ 30 MPG that's 133,333,333 gallons of
>fuel... we get about 439 gallons of biofuel per
>acre of corn... that would require 303,720.576
>acres of corn... roughly 1/4th of the state of
>Rhode Island.
now let's see.
wilbur and orville wright flew a few hundred feet. on saturday i'm
flying to korea from JFK nonstop
your argument is that my flight is impossible because there's never
any progress or advancements in techology.
that your argument?
>
>The amount of arable land necessary JUST TO COVER
>THE INCREASE IN DEMAND is __Staggering__, never
>mind what it would take to cover a decrease in
>oil production PLUS growth in demand.
uh, what makes you think we have to use land?
>
>> we chemists are shocked...
>
>More like "fucked," if they think they're going
>to replace crude oil with biomass...
uh huh.
JTEM
bpuharic <w...@comcast.net> wrote:
> and jtem's recipe?
You'll have to point out where you imagine me
posting a solution.
No, seriously, you are quite insane. You're
actually stooping to replying to things I
never said.
JTEM
bpuharic <w...@comcast.net> wrote:
> now let's see. it took nature millions of
> years to make birds from dinosaurs
That's nice. There isn't enough arable land
to provide the biofuel to run the cars and
trucks which are expected to be sold over the
next few years, much less enough to keep
the cars & trucks which are already on the
road running.
Moron.
bpuharic
wrote:
>
> bpuharic <w...@comcast.net> wrote:
>
>> and jtem's recipe?
>
>You'll have to point out where you imagine me
>posting a solution.
ROFLMAO!! hey genius...that's my POINT. you HAVE no solution except to
whimper like a long tailed puppy in a room full of rockin chairs.
>
>No, seriously, you are quite insane. You're
>actually stooping to replying to things I
>never said.
me? i'm an engineer. i've seen solutions to technical problems.
you? you're a child who looks at the wright bros, and laughs saying
'that will NEVER fly'.
good luck with that
bpuharic
wrote:
>
now let's see. he says that, because the wright bros flew 800 feet in
the early 20th century
that it's impossible for aircraft to fly across the atlantic.
technology doesn't develop. we have the same technology we did in 1910
uh huh.
TomS
<270120100811103235%jo...@wilkins.id.au>, John Wilkins stated..."
I just looked in vain for the original for what is always referred
to as "the old joke":
Do you enjoy Kipling?
I don't know, you naughty boy, I've never kippled!
Can anyone tell me where it first appeared?
--
---Tom S.
the failure to nail currant jelly to a wall is not due to the nail; it is due to
the currant jelly.
Theodore Roosevelt, Letter to William Thayer, 1915 July 2
John Wilkins
Mike Lyle
> In article <274597471.000...@drn.newsguy.com>, TomS
> <TomS_...@newsguy.com> wrote:
>
>> "On Wed, 27 Jan 2010 08:11:10 +1000, in article
>> <270120100811103235%jo...@wilkins.id.au>, John Wilkins stated..."
>>>
>>> In article <hjn963$3tl$5...@reader1.panix.com>, Paul J Gans
>>> <gan...@panix.com> wrote:
>>>
>>>> Mike Lyle <mike_l...@removethisyahoo.co.uk> wrote:
[...]
>>>>
>>>>> I'm reluctant to advertise Kipling as an authority on economics or
>>>>> anything else, but sometimes he resonates:
>>>>
>>>>> "...
>>>>> Then the Gods of the Market tumbled, and their smooth-tongued
>>>>> wizards withdrew
>>>>> And the hearts of the meanest were humbled and began to believe
>>>>> it was true
>>>>> That All is not Gold that Glitters, and Two and Two make Four
>>>>
>>>> Thanks. We needed a good Kipple.
>>>
>>> I was Kipling in the sun one day
>>> In the merry merry month of May...
>>>
>> I just looked in vain for the original for what is always referred
>> to as "the old joke":
>>
>> Do you enjoy Kipling?
>> I don't know, you naughty boy, I've never kippled!
>>
>> Can anyone tell me where it first appeared?
>
> http://en.wikipedia.org/wiki/Donald_McGill
I was once shocked and amused in unequal measure when I heard somebody
on BBC radio, no less, say that the saucy postcards were by Eric Gill.
Had they gone on to claim that Auntie's Broadcasting House was designed
by Donald McGill, I might have had a seizure (whatever that is: nice
expression, though).
And, re your other post, Kipling was certainly right about some things,
but I'm not convinced that makes him an authority on any of them. (I am
almost certain I know what that means.)
--
Mike.
Paul J Gans
> Ken Shackleton <ken.shackle...@shaw.ca> wrote:
That's partially self-correcting. Other mechanisms will
be pressed into service. Wind power, nuclear, solar,
etc., will be used.
And, as the late Shah of Iran once famously said: "Oil
is too important to be burned", meaning that we need
oil as a base for many many of the products we need,
from food to plastics, from clothing to chemicals.
JTEM
Paul J Gans <gan...@panix.com> wrote:
> That's partially self-correcting. �Other mechanisms will
> be pressed into service. �Wind power, nuclear, solar,
> etc., will be used.
Read what you just wrote. Read it again, and again.
It is completely unscientific and fails miserably
to live up to the standards of evidence required of
this group.
Nuclear energy:
: The yellow stuff that drives almost every reactor in
: the world � uranium � has reached a supply gap that
: dwarfs the wildest dreams of the most successful oil
: or coal investors. In fact, worldwide uranium demand
: already exceeds supply by 139%, and it could take a
: decade or more before mines are able to crank up
: production.
http://www.investmentu.com/research/uranium-investing.html
This one is a bit more iffy, but you get the picture:
http://www.theoildrum.com/node/2379
As for wind & solar, well, it's pretty obvious to even
the causal planner that unless a quantum leap in the
art of energy storage is made, wind & solar still require
us to maintain the means to generate all the electricity
we need without wind & solar. Wind is susceptible to
everything from mechanical failure to, well, even the wind!
And solar, of course, is always useless during the night,
in addition to weather patterns and the usual human errors.
But what bothers me the most is the total lack of anything
so much as resembling a scientific argument. Where's the
numbers?
This is probably due to the fact that there is only a small
amount of oil they can actually replace. They produce
electricity, and we don't use a lot of oil to produce
electricity. And if we used these things to replace, say,
coal, and then use the coal as a solid-to-liquid oil
replacement, that requires still MORE energy for the
processing of that coal.
So, how much energy is going to be produced by these
methods? How much energy is it going to take to manufacture,
install & maintain these systems? Where does the savings
come from? Where are these things going to be located?
JTEM
bpuharic <w...@comcast.net> wrote:
> JTEM <jte...@gmail.com> wrote:
>
> >That's nice. There isn't enough arable land
> >to provide the biofuel to run the cars and
> >trucks which are expected to be sold over the
> >next few years, much less enough to keep
> >the cars & trucks which are already on the
> >road running.
>
> >Moron.
>
> now let's see. he says that, because the wright
> bros flew 800 feet in the early 20th century
I've said it before and I'll say it again: You
need to Google "Fallacious Arguments."
And study hard, you brain dead baffoon.
bpuharic
wrote:
>
telll me again how planes can't fly the atlantic because wilbur and
orville flew 900 feet, m'kay?
bpuharic
wrote:
>
>Paul J Gans <gan...@panix.com> wrote:
>
>> That's partially self-correcting. �Other mechanisms will
>> be pressed into service. �Wind power, nuclear, solar,
>> etc., will be used.
>
>Read what you just wrote. Read it again, and again.
>
>It is completely unscientific and fails miserably
>to live up to the standards of evidence required of
>this group.
really? that's a meaningless statement.
>
>Nuclear energy:
>
>: The yellow stuff that drives almost every reactor in
>: the world � uranium � has reached a supply gap that
>: dwarfs the wildest dreams of the most successful oil
>: or coal investors. In fact, worldwide uranium demand
>: already exceeds supply by 139%, and it could take a
>: decade or more before mines are able to crank up
>: production.
>http://www.investmentu.com/research/uranium-investing.html
>
>This one is a bit more iffy, but you get the picture:
except, of course there are breeder reactors, fusion reactors
he continues with his 'man will never fly' routine
JTEM
bpuharic <w...@comcast.net> wrote:
> except, of course there are
How many are there? Where are they? How much
energy are they producing?
JTEM
bpuharic <w...@comcast.net> wrote:
> telll me again
Okay: You're a goddamn fool who isn't man enough
to slink off, never mind admit error, and you're
such a loser that you'd resort to this kind of
nonsense.
Seriously, shit head, what's your point here? What
is it you hope to accomplish with the retard schtick?
John Wilkins
<mike_l...@REMOVETHISyahoo.co.uk> wrote:
We he *did* design McGill Sands...
>
> And, re your other post, Kipling was certainly right about some things,
> but I'm not convinced that makes him an authority on any of them. (I am
> almost certain I know what that means.)
He was the world leading authority on Kipling's views, I think.
bpuharic
wrote:
>
there are solutions
you just are having more fun with your jeremiads. which are bland,
boring and wrong
bpuharic
wrote:
>
my point is peed your pants and are now sitting in it.
whining is fashionable. but technology exists. to say that our CURRENT
technology is the technology of the future is idiotic
>
>
Mike Lyle
> In article <hjpsph$2lj$1...@news.eternal-september.org>, Mike Lyle
> <mike_l...@REMOVETHISyahoo.co.uk> wrote:
>> I was once shocked and amused in unequal measure when I heard
>> somebody on BBC radio, no less, say that the saucy postcards were by
>> Eric Gill. Had they gone on to claim that Auntie's Broadcasting
>> House was designed by Donald McGill, I might have had a seizure
>> (whatever that is: nice expression, though).
>
> We he *did* design McGill Sands...
>
[...]
--
Mike.
John Wilkins
<mike_l...@REMOVETHISyahoo.co.uk> wrote:
> John Wilkins wrote:
> > In article <hjpsph$2lj$1...@news.eternal-september.org>, Mike Lyle
> > <mike_l...@REMOVETHISyahoo.co.uk> wrote:
> [...]
> >> I was once shocked and amused in unequal measure when I heard
> >> somebody on BBC radio, no less, say that the saucy postcards were by
> >> Eric Gill. Had they gone on to claim that Auntie's Broadcasting
> >> House was designed by Donald McGill, I might have had a seizure
> >> (whatever that is: nice expression, though).
> >
> > We he *did* design McGill Sands...
> >
> That's grotesque.
>
> [...]
I'm just the type to make that claim. Puns are ascending everywhere.
Don't have a down stroke.
JTEM
bpuharic <w...@comcast.net> wrote:
> my point is
Yeah, sure...
Anyhow, shit head here denied "Peak Oil," pointing
to methods we don''t have which can extract ten
times the energy from oil than we currently get.
Of course, when speaking of methods we don't have,
why not one that extracts 100 times the energy, or
even a thousand? We don;t even have a method to
extract 1 million times the energy, so the sky is
the limit here! Why did base his rambling on methods
we don';t have which on extract ten times the energy?
I guess that's a question only the severely mentally
ill can answer...
bpuharic
wrote:
>
>bpuharic <w...@comcast.net> wrote:
>
>> my point is
>
>Yeah, sure...
>
>Anyhow, shit head here denied "Peak Oil," pointing
>to methods we don''t have which can extract ten
>times the energy from oil than we currently get.
can we extract more oil from the ground than we did 50 years ago?
yes.
he says no.
i rest my case
>
>I guess that's a question only the severely mentally
>ill can answer...
tell your mom to change your diaper.
Nick Keighley
> On 23 Gen, 23:51, bpuharic <w...@comcast.net> wrote:
>
> > Why did most of the world's top economists fail to
> > forecast the financial crisis?
>
> I'm no world's top economist, but I don't think that the world
> economic crisis was so difficult to forecast:
>
> growing population + growing percentage of industrialized population +
> growing income inequality + decreasing natural resources = ?
I hadn't seen much sign that it was resource depletion that caused the
banking system to go belly up. Yes, third world countries are
suffering and turning food into fuel does them no favours. And will
probably be our turn some time (eg. "peak oil"). But I don't see how
problems in Africa affected the US morgage market. One theory I've
come across is the massive savings imbalance between the US and other
parts of the world (not just china but japan and germany as well)
caused the problem.