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A Tale Of Two Inflations: Why US CPI Is Flawed And Why Bernanke Will Maintain ZIRP As Revolutions Rage

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Fri, 02/11/2011 - 11:30 | 952646 hedgeless_horseman
hedgeless_horseman's picture

The post is an excellent illustration of the calculus of food inflation as it relates to Fed policy.  However, it does not address the complex variables of food subsidy programs, like SNAP, which exacerbate the problem.

America could save more than $10 billion in 2011, and much more in subsequent healthcare costs in the years to follow.  How?  Simply require SNAP participants to qualify for benefits each month by stepping on a scale.  If a participant's Body Mass Index (BMI) is above CDC standards for obesity(1), then they would not be eligible to receive SNAP benefits for the month.

In 2010 the USA printed and taxed its citizens $64,704,466,071 to pay for the SNAP program (2).  At least 20% of Americans are overweight (3).  If 20% of the SNAP participants failed to qualify, then that equates to more than a $12 Billion savings each year.  I know may not seem like much money in today's Bernank-e-con-omy, but we need to start somewhere. 

The real savings come if people actually do lose weight.  In a study funded by the CDC it was determined that, "The annual healthcare cost of obesity in the US has doubled in less than a decade and may be as high as 147 billion dollars a year (4) says new government-sponsored research."

"Lead author Dr Eric Finkelstein, director of RTI's Public Health Economics Program, and colleagues analyzed data from the 1998 and 2006 Medical Expenditure Panel Surveys,"  according to Medical News Today.  They found that:

·         In 1998 the medical costs of obesity in the US were estimated at around 78.5 billion dollars a year, half of which was financed by Medicare and Medicaid (government health insurance for seniors and families on low incomes).

·         Between 1998 and 2006, the prevalence of obesity in the US went up by 37 per cent.

·         This rise in obesity prevalence added 40 billion dollars to the annual healthcare bill for obesity.

·         The annual healthcare costs of obesity could be as high as 147 billion dollars for 2008.

·         Obesity is now responsible for 9.1 per cent of annual medical costs compared with 6.5 per cent in 1998.

·         The medical costs for an obese person are 42 per cent higher than for a person of normal weight.

·         This equates to an additional 1,429 dollars per year: the costs for an obese person on Medicare are even greater.

·         Much of the additional Medicare cost for an obese person are the result of the added prescription drug benefit.

·         Medicare prescription drug payments for obese recipients are about 600 dollars a year more than for normal weight recipients.

·         Obesity accounts for 8.5 per cet of Medicare expenditure, 11.8 per cent of Medicaid expenditure, and 12.9 per cent of private insurance expenditure.
 
Finkelstein told the press that, "Although bariatric surgery and other treatments for obesity are increasing in popularity, in actuality these treatments remain rare.  As a result, the medical costs attributable to obesity are almost entirely a result of costs generated from treating the diseases that obesity promotes."

The FLOTUS with the toned arms and garden, Michelle Obama, and the USDA, both seem to believe this is an important issue.  From the First Lady's website, www.Letsmove.gov (5):

"The Dietary Guidelines for Americans, put forth by the U.S. Department of Agriculture (USDA), provide science-based advice for individuals over the age of two to promote health and reduce the risk of major chronic diseases. The current Dietary Guidelines, encourage most Americans to eat fewer calories, be more physically active, and make wiser food choices."

I sure wish the person we are paying to oversee our Nation's health, the Surgeon General of the United States of America, would throw her weight behind this idea.  I have not heard anything from her in two years in office.

 
Sources:
1.  http://www.cdc.gov/healthyweight/assessing/bmi/
2.  http://www.fns.usda.gov/pd/34SNAPmonthly.htm
3.  http://www.cdc.gov/obesity/data/trends.html
4.  http://www.medicalnewstoday.com/articles/158948.php
5.  http://www.letsmove.gov/eathealthy.php

Fri, 02/11/2011 - 11:35 | 952695 Stuck on Zero
Stuck on Zero's picture

Way too complicated.  Let the food subsidies be doled out from the twentieth floor of a high-rise with no elevators.

Fri, 02/11/2011 - 11:50 | 952748 GoinFawr
GoinFawr's picture

hahaha!

Fri, 02/11/2011 - 14:22 | 953407 More Critical T...
More Critical Thinking Wanted's picture

hahaha indeed - but US food over-consumption is just a drop in the ocean compared to India's and China's increase in consumption.

And that is what is causing global food inflation, combined with supply shortages. So the whole premise of this article is false:

A Tale Of Two Inflations: Why US CPI Is Flawed And Why Bernanke Will Maintain ZIRP As Revolutions Rage

It has been pointed out again and again that global food price inflation has not been caused by dollar inflation.

For example see global food prices not going up during much of QE1 (from mid 2009 to mid 2010) and being decoupled from other commodity prices:

https://lh5.googleusercontent.com/_VgJQTp0Bsf0/TU6_YfTtTSI/AAAAAAAAAMU/2...

Instead they started going up last summer when key grain production areas in Europe were hit by record heat-waves ...

This kills the whole "dollars newly printed are moving up commodity prices" notion. Reality of global food prices of the past 2 years show that this is simply not true.

Or go to a 20 years history of dollar strength and see 40%+ dollar inflation during the Greenspan era of "printing dollars":

http://research.stlouisfed.org/fred2/graph/fredgraph.png?&chart_type=lin...

If Bernanke's 5% USD weakening caused 30% global food price increases then how come Greenspan's 40% USD weakening was not accompanied by 240% of global food prices increases?

So all the data suggests that the whole "the Fed is the cause of global food price increases" theory reported on ZH is a lie.

You may consider Bernanke the evil reborn, you may disagree with the concept of central banks - but you should not lie to make your points ...

As one of the Ten Commandments declared: "You shall not bear false witness against your neighbor".

 

Fri, 02/11/2011 - 14:24 | 953500 thedrickster
thedrickster's picture

Dear lying sack of shit who refuses to answer posts in which he is substantively challenged. I preempted your arrive to this thread two hours ago, see post #952724.

Are you really such a shilling sack of shit that you cannot address this chart:

http://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximize...

Was the Russell 2K also hit by a heat wave fucker?

 

 

Fri, 02/11/2011 - 15:10 | 953574 More Critical T...
More Critical Thinking Wanted's picture

 

Call me a dummy but have you posted this graph to support my position? If you pull the slider just a tad wider you will get the 'big picture':

https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximiz...

See how detached food prices in dollars (NYSE:DBA, the blue line) are from the other symbols you compared it to? See how QE1 'risk off' left food prices within a narrow channel from 2009 to mid 2010?

See how the blue line started rising in the summer of 2010, as record heat-waves started making it clear that the grain harvest in eastern Europe was in trouble?

Record heat like the first ever 100F temperature reading in Moscow in the summer of 2010, in hundreds of years of meteorological record-keeping:

http://news.nationalgeographic.com/news/2010/08/photogalleries/100810-ru...

2010 was also the hottest climate year on record:

http://data.giss.nasa.gov/gistemp/tabledata/GLB.Ts+dSST.txt

 

Here's an even better chart of the correlation, still using your NYSE:DBA global food prices chart but comparing it to dollar inflation (the dollar index):

https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximiz...

How come QE1 had no effect whatsoever, while global food prices started rising well before QE2 was started? Perhaps because in 2009 there was a good harvest while in 2010 we had a very poor harvest?

So yes, your own chart shows that you are wrong. Or are you one of those who does not take 'no' as an answer? :-)

 

Fri, 02/11/2011 - 15:21 | 953686 thedrickster
thedrickster's picture

I am beginning to think that I may have the damaged cortex, that or you are the most obtuse & dishonest fucker I have encountered.

How can you bring USDX in the discussion without addressing my actual point and the GLARING issue right there in front you.

DBA, QQQQ and the Russell 2K are PERFECTLY correlated from Aug (front running QE2) until risk off. This is a melt-up.

Then again you devolve back into pure conjecture that food prices were flat during QE1 and that somehow proves your point?

Let's look again at the chart;

http://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=Linear&c...

What do you know, assets correlated again. From Nov 08 to Mar 10 look at the correlation between ag commods and the Russell 2K. Note it doesn't break down until the QE1 risk off in the first Q of 2010. Again anyone who operates in reality and doesn't spend all day on a Fed branch website knew this implicity, EVERYTHING WAS FUCKING CORRELATED.

I think there are plenty of theories out there as to where QE1 ended up, I'm not sure to which I subscribe. That said if you cannot see the melt-up from Aug 2010 on, I truly cannot help you. Rather than proposing a hypothesis other than the run up to and execution of QE2, hot money melting up every risk asset class in the world, YOU BLAME A FUCKING DROUGHT.

You are a fraud, go away.

Fri, 02/11/2011 - 16:03 | 953851 More Critical T...
More Critical Thinking Wanted's picture

 

DBA, QQQQ and the Russell 2K are PERFECTLY correlated from Aug (front running QE2) until risk off. This is a melt-up.

You are making a rookie mistake here and you are blaming me for it :-)

Do you know why their values are correlated? Because they are all priced in USD so (all other things being equal) their charts will obviously follow the ebb and flow of the dollar (DXY).

But if you want to see the real effective global food prices, the real prices non-US countries pay for food import, then you need to transform that chart to the USD-neutral 'global currency basket', i.e. you need to create an invariant chart like I did in the second chart I linked to:

https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximiz...

I posted a similar chart previously:

https://lh5.googleusercontent.com/_VgJQTp0Bsf0/TU6_YfTtTSI/AAAAAAAAAMU/2...

That shows the baseline of how those countries are seeing food import prices in their own currencies. And yes, this is basic stuff.

I even posted an example calculation of how this works in practice, I showed a sample commodities trade transaction between India and Russia:

http://www.zerohedge.com/article/did-wikileaks-confirm-peak-oil-saudi-sa...

But the ironic thing is that even if in the original USD-obscured chart you posted the big non-QE global food price surge starting in mid 2010 can be seen very clearly, if you widen the time-scale a bit:

https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximiz...

You have to be blind to not see the blue line of food prices going from sideways movement for more than a year to a straight +40% dash :-)

 

Fri, 02/11/2011 - 16:33 | 953965 Stimulus Billy
Stimulus Billy's picture

Please, all of you, do not confuse reality (the cost of eating) with the value of stock market indexes.

Fri, 02/11/2011 - 17:40 | 954213 thedrickster
thedrickster's picture

I am done with you but can't let this post go.

Are you really so focused on a summer weather induced food price spike obfuscation to not see the obvious here?

https://lh5.googleusercontent.com/_VgJQTp0Bsf0/TU6_YfTtTSI/AAAAAAAAAMU/2...

Look at the correlation, presumably all non-food commodities begin an upward move with food in July 10 (at perhaps an albiet SLIGHTLY lower rate given the relative slopes). What say you to this, drought? I say QE1 finally shows up in commodities pits.

Layer the baltic dry index on top of your charts, what does that look like?

Finally I don't see how a focus on USD denominated asset prices is a "rookie mistake". What is the topic of conversation here? What is the hypothesis? 

How does the lockstep rise in USD denominated risk asset prices absolve the Fed and QEx? What I see and what I am interested in is ANOTHER Fed blown asset bubble. This isn't ebb & flow, this is a move with conviction. 

So by all means tell those pegged to the USD and net food importers crossing in USD, that USD asset prices are irrelevant to the discussion.

 

Sat, 02/12/2011 - 05:58 | 955428 More Critical T...
More Critical Thinking Wanted's picture

 

Look at the correlation, presumably all non-food commodities begin an upward move with food in July 10 (at perhaps an albiet SLIGHTLY lower rate given the relative slopes). What say you to this, drought?

You misunderstood the graph, the blue line is all commodities - food included. It necessarily bears the characteristics of food price movement as well.

Compare oil to the dollar index for example, over the same time period:

http://chart.finance.yahoo.com/z?s=BNO&t=1y&q=l&l=on&z=l&c=UUP&p=s&a=v&p...

This shows you not only the inverse price correlation with the dollar index but will also tell you that during this period there was an about 20% increase in the real (global) value of oil, while food rose by 40%+.

It will also show you that the general macro pattern of oil price movement is different from that of food price movement: while food prices moved up by 40% almost in a straight line (as the supply worries increased in probability and started to sink in and play out) the oil price movements were in 'waves', as various supply worries and political instabilities in 2010 shaped it.

You can see key oil events there such as the rises and drops during the summer as worries about the BP oil-spill efforts were increasing / dropping.

In that graph you will also see much of the 20% rise in real oil prices happened after late November 2010. (the 'increase' in prices visible before that in the graph was mostly due to the weakening in the dollar [the green line]: global oil prices remained relatively unchanged.)

So under your theory, do you think that food prices started increasing in the summer, magically frontrunning the Fed's September QE2 decision (which was based on the catastrophic August 2010 core CPI reading) - while oil prices waited until December 2010??? Your theory of commodity price increases being linked to QE2 liquidity makes no sense at all :-)

So by all means tell those pegged to the USD

Do you mean those who voluntarily pegged themselves to the USD via selling the yuan and buying the dollar, despite the US asking them not to peg?

So you are mixing up cause and effect again: by all means I'm telling them to stop doing that if it hurts  ...

 

Fri, 02/11/2011 - 15:23 | 953695 thedrickster
Fri, 02/11/2011 - 16:11 | 953909 More Critical T...
More Critical Thinking Wanted's picture

 

This reply applies to your updated chart too:

http://www.zerohedge.com/article/tale-two-inflations-here-why-us-cpi-ind...

Note that you can still see the USD 'micro-structure' in pricing even in 2007-2008 - there was no QE back then ... :-)

And yes, USD micro-structure is a common property of pretty much all USD instruments that have some sort of foreign trade link. (and most of them have)

Btw., what we can see in the 2007-2011 chart is another interesting thing: the huge 2008 commodities supply squeeze.

In any case, my conclusion still stands: you are confusing the ages-old USD micro-structure/correlation of commodities prices (their inverse correlation with the dollar's strength) with a QE link. You need to look at 'global/currency-neutral' price charts if you want to see the real forces that move global commodity prices.

 

Fri, 02/11/2011 - 17:48 | 954243 thedrickster
thedrickster's picture

FYI it's not me junking you.

" you are confusing the ages-old USD micro-structure/correlation of commodities prices (their inverse correlation with the dollar's strength) with a QE link."

And what is driving USD strength at this point?

Fri, 02/11/2011 - 22:41 | 954970 More Critical T...
More Critical Thinking Wanted's picture

 

It does not matter, because when the dollar index ticks up, commodities tick down ...

They are in an inverse relationship. They compensate out. Commodities are priced globally, not by the USD. When the dollar weakens by 1% then oil goes up by 1% (all other things being equal). So the price of oil to India or Russia stays largely constant. And that's expected: nothing happened on the oil market, only the dollar got weaker, why should India pay less or more for Russian oil??

Do you really still not understand this simple concept?

This is why you see the Russell 2K or other indices correlating with commodities prices.

 

Sat, 02/12/2011 - 00:52 | 955180 thedrickster
thedrickster's picture

After nearly 12 hours I think I have won.

You concede the Russell 2K and the Qs tick along with commodities, in fact you readily assert inverse dollar correlation.

That said, why not just inflate down to nominal zero? Then obviously by your metrics the R2K would stand at 90K and I would be filthy rich beyond any parasite's wildest dreams.

Sat, 02/12/2011 - 01:07 | 955203 thedrickster
thedrickster's picture

Fundamentals?

Fuck that, do QE9, buy 20T in long bonds and ride the wealth effect to nirvana.

Fri, 02/11/2011 - 18:50 | 954421 meizu
meizu's picture

heat-waves, droughts, supply shocks can at most cause temporary price increase

Fri, 02/11/2011 - 14:30 | 953518 thedrickster
thedrickster's picture

" then how come Greenspan's 40% USD weakening was not accompanied by 240% of global food prices increases?"

Greenspan's asset bubble was in tech followed by housing. The Bernank's bubble is bringing every risk asset along for the ride.

I don't doubt that there is organic demand & supply crunch within the ag commodity future bubble but for you to discount the global risk asset bubble that is apparent to anyone that cares enough about their cerebral cortex to not spend all day on Fed Branch banks' websites, is just a fucking lie, period. Shilling, obfuscation, flat lying to protect your (likely) employer or benefactor.

Asshole.

 

Fri, 02/11/2011 - 14:37 | 953562 Sophist Economicus
Sophist Economicus's picture

Well done!   Now, for god's sake, take it easy.....So many more posts, so little time - gotta save yourself for things that matter - not stupid trolls

Fri, 02/11/2011 - 15:09 | 953594 More Critical T...
More Critical Thinking Wanted's picture

Greenspan's asset bubble was in tech followed by housing. The Bernank's bubble is bringing every risk asset along for the ride.

The hard data of global food prices over both QE1 and QE2 destroys that hypothesis quickly:

https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximiz...

(the blue line is 'global food prices', approximated via a food commodities fund and a dollar index fund.)

As ZH reported it so prominently in 2009, QE1 was a global 'risk off' all-out liquidity rush as well.

How come global food prices ... went down up until the middle of 2010?

Maybe this helps you understand what happened in the middle of 2010 (and QE2 only started months after the food uptick):

See how the blue line started rising in the summer of 2010, as record heat-wavesstarted making it clear that the grain harvest in eastern Europe was in trouble?

Record heat like the first ever 100F temperature reading in Moscow in the summer of 2010, in hundreds of years of meteorological record-keeping:

http://news.nationalgeographic.com/news/2010/08/photogalleries/100810-ru...

 

Fri, 02/11/2011 - 15:30 | 953727 thedrickster
thedrickster's picture

"See how the blue line started rising in the summer of 2010, as record heat-wavesstarted making it clear that the grain harvest in eastern Europe was in trouble?"

Magically QQQQ and the Russell 2K tick and the same time and show nice correlation. Again it must be another case of a drought induced tech bubble...I'm sure some asshole economist at the Fed has proven it conclusively.

Fri, 02/11/2011 - 16:19 | 953921 More Critical T...
More Critical Thinking Wanted's picture

 

Magically QQQQ and the Russell 2K tick and the same time and show nice correlation.

Of course, as all are priced in USD and all instruments involve a lot of foreign trade so their 'real price' correlates inversely with the USD's strength. What else did you expect?

This correlation is visible for decades going back, pretty much ever since commodities markets existed ...

If you want to see the real effective global food prices, the real prices non-US countries pay for food import, then you need to transform that chart to the USD-neutral 'global currency basket', i.e. you need to create an invariant chart like I did in the second chart I linked to:

https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximiz...

This chart shows the baseline of how those countries are seeing food import prices in their own currencies.

I've been trying to explain this to you ever since you started arguing this point.

I expected an eventual "indeed you are right, silly me!" reply from you - instead you are hurling insults at me. Could we please settle this question finally? It's not rocket science.

 

Fri, 02/11/2011 - 16:23 | 953937 thedrickster
thedrickster's picture

"the real effective global food prices, the real prices non-US countries pay for food import,"

Because net food importers buy food in their local currency? Oh wait.

Fri, 02/11/2011 - 17:26 | 954149 More Critical T...
More Critical Thinking Wanted's picture

 

Because net food importers buy food in their local currency?

Correct, they have their local currency to buy food with, and if you follow the link I gave you:

http://www.zerohedge.com/article/did-wikileaks-confirm-peak-oil-saudi-sa...

You'll see that that's precisely what happens in the end: they have their local currency which they convert to USD, which the seller of the commodity converts to its own local currency:

(X/Y) * (Y/Z) = X/Z

The 'Y' rate, USD, is largely eliminated from non-US trade transactions.

The USD is an intermediary currency and its numeric, exchange value is largely immaterial - what matters to the oil transaction I linked to is the Rupees->Rubles exchange rate and the price of the commodity (which compensates for USD fluctuations).

If you check the intraday charts you will see that most commodity prices will fluctuate up and down daily to eliminate the effects of the USD rate - inversely to the dollar index.

 

Fri, 02/11/2011 - 18:16 | 954334 thedrickster
thedrickster's picture

Algebraically in a vaccumm sure, unless X must equal Y. That would be CNY no?

Fri, 02/11/2011 - 22:46 | 954980 More Critical T...
More Critical Thinking Wanted's picture

 

CNY is not 'X equals Y' - China does not print dollars.

It is: "every time China sees the dollar weakening, it voluntarily (and against the US's express wishes) sells yuans and buys dollars - to undercut US export/production prices."

That is equivalent to: "Every time the dollar weakens I pull out a bit of hair. Do I get to blame Bernanke for my eventual baldness?"

 

Sat, 02/12/2011 - 01:05 | 955200 thedrickster
thedrickster's picture

"against the US's express wishes"

You are lying again.

It's not parasitism, in this case it is quite symbiotic. With the Fed having just past China in absolute holdings, without the peg demand for US Treasury securities at the current yield colllapses.

The peg is all the Empire has left and amazingly totalitarian collectivists like yourself condemn it, your salvation.

So am I correct in saying that 1) The Fed's actions have no impact on China's various bubbles and naturally without the Renimbi peg and the requisite demand for US treasuries, the US fiscal house of cards would come crashing down with the Fed already being the largest single holders of USTs and derived CNY demand having passed away.

Organic demand died 3 years ago.

Plug this into your model, the risk free asset is now toxic paper.

Fri, 02/11/2011 - 15:25 | 953697 thedrickster
thedrickster's picture

Sorry I just really hate the shilling ivory tower fed sycophant type.

That and this little bastard was one of the shrieking Giffords commissars.

I will be a grown-up now and forget he exists, I promise.

Fri, 02/11/2011 - 18:43 | 954403 meizu
meizu's picture

"Economists generally agree that high rates of inflation and hyperinflation are caused by an excessive growth of the money supply"

http://en.wikipedia.org/wiki/Inflation

crack open any Introductory Economics text book, it will tell you you can not generate sustained price inflation from supply shocks, you can only do it by increasing the money supply

Fri, 02/11/2011 - 18:46 | 954406 meizu
meizu's picture

"Economists generally agree that high rates of inflation and hyperinflation are caused by an excessive growth of the money supply"

http://en.wikipedia.org/wiki/Inflation

open any Introductory Economics text book, it will tell you you can not generate sustained price inflation from supply shocks, you can only do it by increasing the money supply

Fri, 02/11/2011 - 12:29 | 952947 THE DORK OF CORK
THE DORK OF CORK's picture

Never tasted banker - the flesh is perhaps a little too rich for my taste.

Fri, 02/11/2011 - 11:36 | 952700 Bob
Bob's picture

Fat chance of that!  Even conservatives will reject it as government intrusion. 

Fri, 02/11/2011 - 11:49 | 952745 Sean7k
Sean7k's picture

Well, we could also outlaw the sale of soft drinks and fast food as well. Let's get rid of snacks and ice cream- or we could put scales in the markets and let a person's BMI determine which foods they could buy as well. Actually, most "production" prepared foods contribute to this problem- therefore, we should outlaw all those as well and require people to cook from scratch. 

We probably should look into pesticide, herbicide and fertilizers used on food and livestock as these likely cause cancer and we all know the cost of cancer. Cigarettes would need to be outlawed as well- they kill more people than everything combined. 

We could really start saving money if we got rid of war...

Fri, 02/11/2011 - 11:51 | 952753 GoinFawr
GoinFawr's picture

tumours love their fructose!

Fri, 02/11/2011 - 11:57 | 952759 hedgeless_horseman
hedgeless_horseman's picture

You can have all of those things, just stop requiring me to pay for it now...

...$64,704,466,071 to pay for the SNAP program

...and later when you become ill:

Obesity accounts for 8.5 per cent of Medicare expenditure, 11.8 per cent of Medicaid expenditure...

Fri, 02/11/2011 - 12:05 | 952801 Sean7k
Sean7k's picture

I want to stop paying for EVERYTHING, but in the land of totalitarian centrally planned socialism it will require a revolution. I also suspect you are thin. Not that I'm obese, I'm not. Picking and choosing your favorite government expenditures merely pits one group against another.

Picking on the poor and hungry is somewhat cruel. Perhaps we can agree that the devastation practiced by the bankers is a bigger problem and either seize their assets to pay for this or just kill them all and start over. That seems like a fairer solution to me. 

Fri, 02/11/2011 - 12:07 | 952814 Bob
Bob's picture

Pragmatism ftw.

Fri, 02/11/2011 - 12:08 | 952826 hedgeless_horseman
hedgeless_horseman's picture

Picking on the poor and hungry is somewhat cruel.

Hungry people are not obese.

Fri, 02/11/2011 - 12:11 | 952832 Bob
Bob's picture

Social engineering just won't play well on this one. 

Fri, 02/11/2011 - 12:19 | 952862 hedgeless_horseman
hedgeless_horseman's picture

Then good luck with means testing on Medicare.  How is that not social engineering that selects spenders and slackers over savers and producers?

Furthermore, how is a progressive income tax not social engineering?

Fri, 02/11/2011 - 12:29 | 952942 Bob
Bob's picture

Just yanking your chain!  I just can't see trading good health for food as politically tenable.  That doesn't make it bad . . . just irrelevant.

Fri, 02/11/2011 - 12:28 | 952946 Sean7k
Sean7k's picture

Well, you could move somewhere everybody is hungry. Africa has some nice malnutrition, North Korea is probably a hot bed of thin people. 

You are selecting a slice of the population to practice complete social control. You aren't even interested in their health, only the cost to you. 

Until you're willing to call for the same control over all aspects of fiscal waste, you are just another authoritarian central planner. Who will be next? Is this not the basis of 1984? You want to promote tyranny? 

I've read your posts and that is not you. 

Fri, 02/11/2011 - 12:31 | 952961 Bob
Bob's picture

The poor will become the exemplars of all our highest ideals as they--unlike everyone else--will have to be perfect to earn their keep.  It'll be like an inspirational zoo!

Fri, 02/11/2011 - 13:13 | 953121 hedgeless_horseman
hedgeless_horseman's picture

The poor are fattened up, dumbed down, drugged out, and penned in. 

The poor are being farmed for votes.

 

Fri, 02/11/2011 - 14:28 | 953515 Bob
Bob's picture

Well said.  Of course, structural unemployment needed to maintain labor "liquidity" under the best of conditions will inevitably create an underclass over time. 

Fri, 02/11/2011 - 13:11 | 953157 piceridu
piceridu's picture

Hungry people are not obese.

Please read Good Calories, Bad Calories by Gary Taubes
This book will change the way you think about being fat and food.


Fri, 02/11/2011 - 13:27 | 953231 Diogenes
Diogenes's picture

But obese people are always hungry.

Fri, 02/11/2011 - 12:20 | 952871 GoinFawr
GoinFawr's picture

Love it Sean, but you can't kill bankers. They are like that broom Mickey conjured up in Fantasia: chop 'em up and they will rise a thousand fold more determined, self righteous and indignant than ever. No, best to hit 'em right where their skeevy little hearts lie, their assets. Knock their egos down and put 'em to work sweeping up at homeless shelters in bright orange jumpsuits.

Put 'em in the stocks and let people throw commodities (puns intended) at their heads; we'd soon see if they still wanted to include PM's in that basket!

IMHO, natch.

Fri, 02/11/2011 - 12:29 | 952951 Sean7k
Sean7k's picture

Lol. The entertainment value would be off the charts and the poor could work off a few pounds. Sounds like a win-win to me!

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