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Guest Post: It's A Bit Early To Declare A Winner In The Economic Debate

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Submitted by Lance Roberts of Street Talk Live,

 


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Thu, 04/25/2013 - 22:30 | Link to Comment IridiumRebel
IridiumRebel's picture

typo: should read debase

Thu, 04/25/2013 - 22:32 | Link to Comment zorba THE GREEK
zorba THE GREEK's picture

We took a wrong turn years ago and it is doubtful now that we will ever find our way back.

Thu, 04/25/2013 - 22:44 | Link to Comment wee-weed up
wee-weed up's picture

There will be NO winners in today's dishonest economy!

Thu, 04/25/2013 - 23:18 | Link to Comment dasein211
dasein211's picture

Ummmmmmm.... Who is holding cyprus's gold? Does Cyprus have to take delivery to deliver it to their Eurolords? Maybe they can pay in BitGold?!

Thu, 04/25/2013 - 23:24 | Link to Comment knukles
knukles's picture

OK, so what's the hidden motive?
Henry the Economic Architect.
Nah...

Thu, 04/25/2013 - 23:27 | Link to Comment Muppet of the U...
Muppet of the Universe's picture

HEY YOU!  Just wanted to grab someone's attention on the way down - The world's supply of gold is not going to run out in the next few months.  This is nearly impossible.  This is called dip buying, and its nearly over as prices are back at 1500ish.

Don't bother responding, i no read, > 99% of ZH posters are not originals anymore.  Just muppets who piled in at end of bull nto bear cycle.  Maybe tht change one day - Prob not.  Still ZH descent material w/ clear bias.  For thse who are smart, read on, for those who are dumb as fuck - mark video like it matters and stfu.

Do not listen to ZH - They have become charlatans.  Do not let the dealers hoodwink you, they say they have no gold b/c they want you to pay insane premiums.  Why do all of you dunces buy silver eagles when you could buy engel or matthey for < half the over spot cost?  Its all metal - stop being stupid.  In 5-10 years, and more likely 15-30 years, there will be supply issues.  But the economy won't even last that long.  Don't let dealers hoodwink you.  You woke up and learned about investment and barely scratched the surface on finance and asset prices. 

& FFS, the comex isn't going to blow up.  Look at when JPM added its gold position to the comex and when it dumped it?

That would mean JPM lost a fuckshitton of money.  Guess what its actually for the comex reserves, which reflect the price.

Now whether Comex has the stuff or not?  I can't honestly say.  But I would bet a million to one, that you and all you buddies heard comex doesnt have the gold/silver from a bullion youtuber who is prob a phys dealer.

Phys dealers wnt you to think Comex will crash so you buy phys and not paper gold.  It makes them money.  They have a financial reason to make you believe comex = crash.  Remember the banks can print money in zirp environment, they can literally buy as much phys as they want and put in the comex, there was 10 million ounces produced in us alone last year.

China goes long metals b/c china wants a hedge against a us dollar blow up.  But china has to hold dollar if china wants us to buy all their worthless shit.  Its a mutual benefit that will net profit china immensely in 5-10 years.  But right now people just buy on dps and trade paper price in futures., so they can live comfortably.  Get it?

You aren't gonna crash shit by buying phys.  They can PRINT MONEY.   GET IT?  We will have hyperinflation b4 we run out of phys. Get it?  Asset prices and bubbles are everywhere begging you to participate, get it?

Do some more learning, and look to other commodities and assets for opportunity.  The goal is to make money, not sit on a bunch of metal thinking that when the sheeple lose their shit in the fan you'll be rich.  That's fucking stupid.  Money is mostly made b/c the sheeple haven't lost their shit, and you won't make any money if they do.  I know you hate the guy, but for fucks sakes if you had gone for the money bernanke would have made you a small fortune.  & guess what?  Its qe4eva.  They may at some point actually lessen qe, or go one talking about ending it but it will never stop, and even if lessened, will likely go right back to increasing. 

Think don't panic, and then zerohedge will stop posting retarded sht designed to make muppets panic.

HEY YOU!  Just wanted to grab someone's attention on the way down - The world's supply of gold is not going to run out in the next few months.  This is nearly impossible.  This is called dip buying, and its nearly over as prices are back at 1500ish.

Do not listen to ZH - They have become charlatans.  Do not let the dealers hoodwink you, they say they have no gold b/c they want you to pay insane premiums.  Why do all of you dunces buy silver eagles when you could buy engel or matthey for < half the over spot cost?  Its all metal - stop being stupid.  In 5-10 years, and more likely 15-30 years, there will be supply issues.  But the economy won't even last that long.  Don't let dealers hoodwink you.  You woke up and learned about investment and barely scratched the surface on finance and asset prices. 

& FFS, the comex isn't going to blow up.  Look at when JPM added its gold position to the comex and when it dumped it?

That would mean JPM lost a fuckshitton of money.  Guess what its actually for the comex reserves, which reflect the price.

Now whether Comex has the stuff or not?  I can't honestly say.  But I would bet a million to one, that you and all you buddies heard comex doesnt have the gold/silver from a bullion youtuber who is prob a phys dealer.

Phys dealers wnt you to think Comex will crash so you buy phys and not paper gold.  It makes them money.  They have a financial reason to make you believe comex = crash.  Remember the banks can print money in zirp environment, they can literally buy as much phys as they want and put in the comex, there was 10 million ounces produced in us alone last year.

China goes long metals b/c china wants a hedge against a us dollar blow up.  But china has to hold dollar if china wants us to buy all their worthless shit.  Its a mutual benefit that will net profit china immensely in 5-10 years.  But right now people just buy on dps and trade paper price in futures., so they can live comfortably.  Get it?

You aren't gonna crash shit by buying phys.  They can PRINT MONEY.   GET IT?  We will have hyperinflation b4 we run out of phys. Get it?  Asset prices and bubbles are everywhere begging you to participate, get it?

Do some more learning, and look to other commodities and assets for opportunity.  The goal is to make money, not sit on a bunch of metal thinking that when the sheeple lose their shit in the fan you'll be rich.  That's fucking stupid.  Money is mostly made b/c the sheeple haven't lost their shit, and you won't make any money if they do.  I know you hate the guy, but for fucks sakes if you had gone for the money bernanke would have made you a small fortune.  & guess what?  Its qe4eva.  They may at some point actually lessen qe, or go one talking about ending it but it will never stop, and even if lessened, will likely go right back to increasing. 

Think don't panic, and then zerohedge will stop posting retarded sht designed to make muppets panic.

Thu, 04/25/2013 - 23:34 | Link to Comment Muppet of the U...
Muppet of the Universe's picture

http://www.youtube.com/watch?v=OeLWW2o4LcI  now most of the posters here went down with the gold and silver ship just now and still think silver gooing to 5000 dollars.  Most peopple here are dumb as fuck.  Remember most poster here went long likee 1700 repeatedly and never cut losses.  I say this for like that random 1 guy in the clusterfuck of morons who wants to understand the market more.  phys is good to have position in, but minimal compared to futures potential.  everyone else, enjoy fantasy land.

Fri, 04/26/2013 - 00:11 | Link to Comment Diogenes
Diogenes's picture

Thanks for the view from Muppetville. I may be dumb as fuck but not dumb enough to listen to your bullshit.

Fri, 04/26/2013 - 03:54 | Link to Comment James_Cole
James_Cole's picture

now most of the posters here went down with the gold and silver ship just now and still think silver gooing to 5000 dollars.  Most peopple here are dumb as fuck.  Remember most poster here went long likee 1700 repeatedly and never cut losses.  I say this for like that random 1 guy in the clusterfuck of morons who wants to understand the market more. 

And being such a genius you're graciously hijacking threads to rant about how dumb everyone is on here ? Brilliant work. Nice to know them smart folks is usin they time wisely. 

Fri, 04/26/2013 - 04:18 | Link to Comment AldousHuxley
AldousHuxley's picture

 

WEAK Economy --> Increase in GOV DEBT --> WAR to steal oil to subdue inflation --> PRINT money to erase DEBT --> Economy stronger relative to other nation states who can do war or print

Fri, 04/26/2013 - 06:55 | Link to Comment negative rates
negative rates's picture

I'm pullin out of this potcorn stand.

Fri, 04/26/2013 - 07:25 | Link to Comment Flakmeister
Flakmeister's picture

Hemp is more versatile than I ever thought...

Fri, 04/26/2013 - 14:09 | Link to Comment Plausible Denia...
Plausible Deniability's picture

This guy blows my mind. I don't think he GETS IT. Gold and silver are currencies. Always have been, always will be. Hell, Solomon used both metals to pay for materials to build the temple. The fad is fiat currency. This too shall pass. The problem i have with guys like this and Buffett believers is that their premise is wrong. I'm not arguing that gold is a better "investment" than farmland or a well run profitable company. I am simply arguing that, in the future, I believe I will be able to buy more farmland and a greater stake in a profitable company with gold holdings as opposed to fiat currency. As to the Keynesian/Austrian debate, I believe both to be "correct". Keynesian economics, in an academic vacuum, presents a compelling analytic case. The problem is that the theory is made up of observations and calculations of a US centric global economy yet dedicates neither credit or calculations to account for the unprecedented backdrop of economic freedom and government constraint that served as the incubator for the US economy. So, Krugman and his ilk are making cause and reaction observations inside of an economy while failing to account for the construction of the economy. Over time, their theories erode the economic environment to the point that their theories, while previously effective and observable, no longer hold because the environment in which they are being administered has changed. This is precisely why virtually all of "their"projections have fallen woefully short. I would equate it with being a zoologist (sp?) and studying Yellowstone park. You would observe the incredible number of species and the quantity of each species that thrives in the area. You might test the soil and find high levels of ash and begin to conclude that in order to grow impressive wildlife populations the PTB should do everything possible to encourage heightened volcanic activity, maybe an Old Faithfulesque geyser or two, and all areas would be able to support such an impressive stock of wildlife. All the while, these observations have failed to take into account that Yellowstone is a federally protected wildlife reserve. Sure, the volcanic activity may have created a food rich environment that sustained the huge number of animals. However, it's nothing that a few unregulated hunting seasons couldn't correct.

Thu, 04/25/2013 - 23:38 | Link to Comment Oldwood
Oldwood's picture

So you are saying that because they are printing like mad to save their asses, our only option is to btfd? Regardless of the fact that they and obviously you are more than willing to burn the whole thing to the ground for personal profit. Its just a damn shame more people aren't actually producing things for a living rather that preying on sheep that have as their only option to buy the fucking dip.

Fri, 04/26/2013 - 00:06 | Link to Comment markovchainey
markovchainey's picture

This is what MDB would sound like after he suffered a massive head injury.

Fri, 04/26/2013 - 01:02 | Link to Comment dumpster
dumpster's picture

muppet

 

your a certified ding bat with out a pound to pizz in .. so you make pretend gestures of a squicking mouse .. or even a pouting guy in knee deep diapers

Fri, 04/26/2013 - 10:56 | Link to Comment Svendblaaskaeg
Svendblaaskaeg's picture

Goldenfreude much?

Thu, 04/25/2013 - 23:11 | Link to Comment daxtonbrown
daxtonbrown's picture

Henry Blodgett, who holds the distinction of being more stupid than Krugman. If you put Blodgett, Krugman and Jim Cramer in a bag, a box of rocks would be smarter.

Fri, 04/26/2013 - 06:57 | Link to Comment NoDebt
NoDebt's picture

They're not stupid, they have an agenda (they may be stupid on top of that, though).  I can't buy what they say because I've lived through the 2 prior bubbles in recent history:

1.  DotCom stock valuations don't matter because of the huge growth of the internet that will transform our lives.

2.  Housing valuations don't matter because house prices only go up and nobody would ever default on their mortgage.

And now:

3.  Government deficits don't matter because the government can never default and they can spend us back to prosperity.

I'm sorry, but I'm just too old to believe in anything that starts with the premise that some big thing you know is important "doesn't matter."  If it wasn't important, why measure it in the first place?

Last open car on the Bubble Train!  All Aboard!!

 

Fri, 04/26/2013 - 08:43 | Link to Comment Apocalicious
Apocalicious's picture

No, Blodget is stupid. He may not realize he's a pawn in the agenda of others. Kramer plays his role willingly, but moments of clarity highlight the congnative dissonance that accompanies his paycheck. Krugman is aware of his role, and also supremely confident in his "superior" intellect. But Blodget is a mind-numbingly idiotic dolt.

Fri, 04/26/2013 - 07:46 | Link to Comment smlbizman
smlbizman's picture

i would rather see blodget, john elway, john kerry and mister ed in a stable and see which one looks more like a horse.....

Fri, 04/26/2013 - 08:50 | Link to Comment Bendromeda Strain
Bendromeda Strain's picture

Drop Elway and make it a real challenge - the horse gets to face the opposite direction...

Thu, 04/25/2013 - 22:29 | Link to Comment Poqit
Poqit's picture

Yeah you gotta think about the long term...now back to these super important intra-day correlations.

Thu, 04/25/2013 - 22:32 | Link to Comment algol_dog
algol_dog's picture

Henry Blodget !!! That a-hole who was promoting all those nasdaq paper tigers in the late 90's. I watched him the day Facebook went public on CNBC proclaiming the stock was going to $100 if I recalll ... 

Thu, 04/25/2013 - 22:33 | Link to Comment Jim B
Jim B's picture

Krugman has the intellect of a child, borrowing from your future results in a very ugly future.

Yes, the petulant child president also has a Nobel prize! LOL! 

 

Thu, 04/25/2013 - 23:37 | Link to Comment GeorgeHayduke
GeorgeHayduke's picture

Politicians have borrowed from the future for decades now. However, it took off at full force once Ron Reagan's Morning in America arrived on the scene. That's when non-war borrow and spend government took on a whole new meaning. Every president since has followed his lead, with Clinton and Obama spending less than the Republicans. Here's the Forbes article showing it:

http://www.forbes.com/sites/rickungar/2012/05/24/who-is-the-smallest-gov...

Interesting how much money was spent in Bush the Lesser's 1st term in which he had a Republican Congress. As usual, the walk doesn't live up to the talk.

Yeah, I know, you conservatives and Republicans who want to blame everything on the liberals and Dems won't believe any facts that don't fit with your beliefs. but there it is anyway. Use whatever cognitive dissonance is needed to keep the facts from entering the thought process.

Fri, 04/26/2013 - 00:50 | Link to Comment Oldwood
Oldwood's picture

Yes you are right. It IS all Bush's fault. We just all forgot. But just for grins, what was the average economic growth under Reagan and Bush (the lesser as you call him) terms compared to Obama's? Just wondering.

Fri, 04/26/2013 - 09:53 | Link to Comment GeorgeHayduke
GeorgeHayduke's picture

Didn't say it was Bush's fault, you did. I just said the reality doesn't reflect the storyline. As for economic growth, are you implying that more government spending equals more economic growth? isn't that socialism according to most connedservatives?

Fri, 04/26/2013 - 05:59 | Link to Comment Roandavid
Roandavid's picture

Had you been there or new some history regarding the Reagan administration, you would remember that every Reagan budget was "dead on arrival" as silly little democrats would not allow for any spending cuts then, as now.

Your point is fiction.

Fri, 04/26/2013 - 09:57 | Link to Comment GeorgeHayduke
GeorgeHayduke's picture

Thanks for providing the cognitive dissonance I forecast. It also shows you didn't read the article as they talk about that too.

I'm not a pro-democrat liberal. I prefer looking at reality, which is something beyond the ability of most connedservatives I've ever encountered. Sure, hardcore liberals don't want to see it either, but there are so few of those that i ever run into in the real world.

Thu, 04/25/2013 - 22:48 | Link to Comment fonzannoon
fonzannoon's picture

deleted

Thu, 04/25/2013 - 23:29 | Link to Comment Unique Snowflake
Unique Snowflake's picture

I agree. I wish Krudman, Bersnake, Obomba and Bloggit ALL could be deleted.

Thu, 04/25/2013 - 22:45 | Link to Comment slimething
slimething's picture

Has Krugman ever had to meet a payroll? He and Obama should go into business together and see how their theories work in the real world.

Thu, 04/25/2013 - 22:49 | Link to Comment mayhem_korner
mayhem_korner's picture

 

 

The argument may not be over, but the result has long since been determined.  Debt loses.

A marathon is decided long before it is run; the race only reveals what has already been decided in the training regimens.

Thu, 04/25/2013 - 22:49 | Link to Comment ebworthen
ebworthen's picture

Henry Blodget - what a fucking tool - he will say whatever makes him a buck - that is the problem - too many worms like that and not enough adults.

Fuck off Blodget!

Thu, 04/25/2013 - 22:50 | Link to Comment disabledvet
disabledvet's picture

"driving up the value of liquidity." capitalism hasn't been vanquished...although it is striking to see how well it's doing in this VERY non keynesian world. this is about bailing out CAPITALISM not the State based upon "the Japanese experience" where as with the USA in the Depression and Europe right now "the liquidity was of insufficient quantity and timed too late" to have the desired "effect." this did not happen to the USA as Greenspan had been removed and the "plunge protection team" put in place by 2006. "the lodestar" as it were was Bernanke...but obviously so was the idea that "we had money to burn" in the first place (deficits were low at the time, there was ample Government largesse in the form of a war, "better to be safe than sorry.") obviously no one could have imagined the depths of the collapse...but with the bulk of all those emergency programs now withdrawn save one i really don't see where the "general gist" was wrong. imagine if nothing had been done as happened in the Great Depression...or worse what Europe is now doing. i do agree what's going on now is not good. but most of these issues relate to the financing of the State and State programs...not anything fundamental with the financial system or a general breakdown in order. and if the President is about to order some type of serious engagement with Syria...i say again...be wary of being caught short here. in ANYTHING. (i still think the collapse in gold and silver was caused by the Boston terror attack myself...the biggest terror attack since 9/11. interestingly the "fake tweet" on AP was claimed to be the result of some Syrian thing.) this will be the first "scaled" executive action this President has taken since being elected in the first place...let alone re-elected. so far the rhetoric has been anything BUT "militaristic" (downright lawyerly actually.) the rhetoric does have my attention though. http://seekingalpha.com/symbol/ba?source=search_general&s=ba not that i'm expecting this of course: https://en.wikipedia.org/wiki/Erwin_Rommel we shall see...

Thu, 04/25/2013 - 22:58 | Link to Comment Oldwood
Oldwood's picture

The great depression only became "great" AFTER they started doing something, and they did plenty, for years and years. FDR's own people complained about the dramatic amount of money that was spent with no effect. And the constitution was beat to hell in the process. This is where we got the current interpretation of the "commerce clause" which allows the government to intrude into virtually every financial transaction. Please, don't preach about the great successes of the great Depression policies. We would all be better off if they all did NOTHING at all. Please go home and leave us alone!

Fri, 04/26/2013 - 04:29 | Link to Comment Beam Me Up Scotty
Beam Me Up Scotty's picture

Fuck FDR. Big government prick!

Fri, 04/26/2013 - 07:31 | Link to Comment tip e. canoe
tip e. canoe's picture

This is where we got the current interpretation of the "commerce clause" which allows the government to intrude into virtually every financial transaction. 

and any virtually every single human interaction is interpreted as a "financial transaction" which allows guv to intrude into virtually every single human interaction.

Fri, 04/26/2013 - 08:59 | Link to Comment DOT
DOT's picture

Indeed, Tip e, the gobmint is trying to save "Financialism" not "Capitalism.

Thu, 04/25/2013 - 22:51 | Link to Comment W74
W74's picture

I've been seeing a lot of this kind of drivel lately.  They're trying to create a "narrative" to feed to the population.

Ooften they will to claim that the (nominal) upswing in the stox markets and "growth" (which I denounce as a concept) as evidence that big-government, Keynesian policies are working.

 It's sick because too many sheeple think of currency as wealth which is the whole basis for this fraudulent school of thought.

Thu, 04/25/2013 - 22:51 | Link to Comment Oldwood
Oldwood's picture

IF printing money works so well, why can't we all do it? The bastards pushing this drivel are the only ones getting fat while the rest of us starve. They might as well be beating me and telling me it for my own good! Obama flew over my house on his way from Waco to Dallas this evening and I was fully prepared to feel the mist on my face as he was peeing out the door on us all. The money spent for his little day trip would have probably rebuilt most of those people's homes that got blown away last week, not to mention his $10,000/plate dinner the night before. Two navy ones and three military transports. A sight like that years ago would have made me feel proud, but not anymore. Criminal elite.

Thu, 04/25/2013 - 23:12 | Link to Comment sbenard
sbenard's picture

You make a good point! If simply spending without restraint and monetizing ALL the resulting debt is such a glorious idea, then why not take it to an extreme!? Let's just print $1 million for every person in the world! Or let's throw caution to the wind. Why not $1 trillion for everyone!

The thought of such an absurdly destructive notion, carried to its extremities, exposes the true insanity of the idea that simply printing money somehow creates a "wealth effect", as Bubbles Bernanke hs expressed it. Only the first few in line become wealthy, and all at the expense of everyone else that tries to feed at the pig trough subsequently. A few get rich, but everyone else is impoverished!

Thu, 04/25/2013 - 23:34 | Link to Comment Bear
Bear's picture

You can print anything you want ... the secret is to tell enough lies so everyone thinks what you print is of value. 

Thu, 04/25/2013 - 23:41 | Link to Comment McMolotov
McMolotov's picture

Either that or get the power of the State behind you to force people to accept what you print as having value. At the end of the day, the dollar has value because the government threatens all of us with violence if we don't accept it.

Thu, 04/25/2013 - 22:55 | Link to Comment pauhana
pauhana's picture

One marshmallow now or two marshmallows if you can delay your desire for instant gratification.  Gimme mine now.  I won't live long enough to collect later.  Besides, there won't be any left.   

Thu, 04/25/2013 - 22:57 | Link to Comment LetThemEatRand
LetThemEatRand's picture

This is a debate about nothing.  Let the oligarchs run the world and everything goes to shit.  Period.

Thu, 04/25/2013 - 22:56 | Link to Comment fonzannoon
fonzannoon's picture

There is something very weird going on tonight.

Thu, 04/25/2013 - 23:04 | Link to Comment LetThemEatRand
LetThemEatRand's picture

Just tonight?  I haven't really been paying attention until a few minutes ago.  What's the scoop?

Thu, 04/25/2013 - 23:00 | Link to Comment Oldwood
Oldwood's picture

Every day and every night seem only to get weirder. Thats probably why most old people seem to go mad. We just can't take it anymore.

Thu, 04/25/2013 - 23:06 | Link to Comment fonzannoon
fonzannoon's picture

I mean weird weird. I get home from dinner an hour ago and I am outside with my dog and some low flying aircraft shoots over my neighborhood with a red and green light flashing. Maybe a few hundred feet up. Does not make a noise. Then a helicopter just does a bunch of circles. Then one after the other after the other more of these aircrafts start coming over at all different altitudes. Almost all of them coming in from the ocean. I get my wife because I figure I have actually finally lost my mind. She stands there with her jaw dropped and watches too. There are still a bunch out there at higher altitudes now.

Thu, 04/25/2013 - 23:10 | Link to Comment LetThemEatRand
LetThemEatRand's picture

Are you near a military base?

Thu, 04/25/2013 - 23:09 | Link to Comment ekm
ekm's picture

Don't bother. Just get used to it.

Thu, 04/25/2013 - 23:15 | Link to Comment fonzannoon
fonzannoon's picture

There is a base about 30 miles east of me. I just went back outside. I feel like Ray Liotta in goodfellas looking at the helicopter. There are a large quantity of the same exact aircraft flying overhead. I guess it's military. Maybe it is normal but I have never seen anything like it.

My first thought was it's rich people on their private jets getting the fuck out of here but there are just too many of them.

This is Long Island, huge population. People just go out at night, especially when there is a full moon and just sit by the ocean. There has to be a whole lot of people with their minds blown right now

Thu, 04/25/2013 - 23:18 | Link to Comment ekm
ekm's picture

Believe me, unless something becomes a risk to life, this is the rule:

Any surprise lasts no longer than 3 days. 

 

Give it 72 hrs and it will be normal.

Thu, 04/25/2013 - 23:22 | Link to Comment McMolotov
McMolotov's picture

Unless some weirdo starts whistling "She'll be Comin' 'Round the Mountain," like that creepy guy from Close Encounters, he's probably in the clear.

Thu, 04/25/2013 - 23:25 | Link to Comment ekm
ekm's picture

LOL

Thu, 04/25/2013 - 23:26 | Link to Comment fonzannoon
fonzannoon's picture

LOL

Thu, 04/25/2013 - 23:19 | Link to Comment Go Tribe
Go Tribe's picture

Any drones overhead? It's not serious until the drones arrive.

Thu, 04/25/2013 - 23:34 | Link to Comment knukles
knukles's picture

Fonz...
Try. flightraware.com

If they're commercial, they'll show up
If military, not

Or UFOs
Giggle giggle snort snort

Thu, 04/25/2013 - 23:33 | Link to Comment knukles
knukles's picture

.

Thu, 04/25/2013 - 23:22 | Link to Comment LetThemEatRand
LetThemEatRand's picture

That is weird.   There are plenty of private jets in your part of the country to fill the sky, but hard to imagine they'd all get the message at once!  

Thu, 04/25/2013 - 23:22 | Link to Comment fonzannoon
fonzannoon's picture

LTER I have a small airport near me that a lot of single engine aricraft use but they would all be in a huge pile on the runway right now because the amount of flow I have seen is way beyond what they could handle.

I will leave it alone from here. But it's weird man. Even weirder that I can still walk out right now and see them.

Thu, 04/25/2013 - 23:25 | Link to Comment LetThemEatRand
LetThemEatRand's picture

I hope you're not the canary in the coal mine.  They don't fare so well.

Thu, 04/25/2013 - 23:30 | Link to Comment fonzannoon
fonzannoon's picture

funny....kind of like ekm mentioned...I am already kind of numb to it. It is probably rich family after rich family getting the fk outta dodge and I am on here scratching my ass...

Thu, 04/25/2013 - 23:32 | Link to Comment LetThemEatRand
LetThemEatRand's picture

I'm officially creeped out that so many people here (yes, we're all nuts but we're not nuts in that way) are seeing the same thing you are.

Thu, 04/25/2013 - 23:37 | Link to Comment Harbanger
Harbanger's picture

Maybe it's only some rich snowbirds coming back to the Hamptons.  You know Corzine alone probably has a small fleet of helicopters.

Thu, 04/25/2013 - 23:41 | Link to Comment LetThemEatRand
LetThemEatRand's picture

It always comes back to Red Team/Blue Team with you, doesn't it.   How about Jamie and Lloyd?

Thu, 04/25/2013 - 23:43 | Link to Comment Harbanger
Harbanger's picture

That was Rich/Poor! not red/blue! -Bitch, I can't ever make you happy.

Thu, 04/25/2013 - 23:45 | Link to Comment LetThemEatRand
LetThemEatRand's picture

Corzine in that context is pure blue.  Bitch.

Thu, 04/25/2013 - 23:49 | Link to Comment Harbanger
Harbanger's picture

You read way too much into things.  It's understandable. Now about your business.

Thu, 04/25/2013 - 23:53 | Link to Comment LetThemEatRand
LetThemEatRand's picture

It's okay to just say what you mean here.  Smoke and mirrors are for pussies.  And disingenuous types.

Thu, 04/25/2013 - 23:52 | Link to Comment Harbanger
Harbanger's picture

I'm ignoring you.

Thu, 04/25/2013 - 23:54 | Link to Comment LetThemEatRand
LetThemEatRand's picture

You're good at ignoring things that don't agree with your ideology, so I'll take that as a compliment.

Thu, 04/25/2013 - 23:58 | Link to Comment McMolotov
McMolotov's picture

We're up against purple fuckers. Purple's the color of royalty and every last one of these fuckers thinks they're kings. We're all on the same side, so stop fightin'.

Fri, 04/26/2013 - 00:12 | Link to Comment LetThemEatRand
LetThemEatRand's picture

Fukishima needs guys like you to stop the next meltdown.

Thu, 04/25/2013 - 23:12 | Link to Comment McMolotov
McMolotov's picture

I'm away for a few hours getting drunk because, honestly, what else am I going to do tonight? So I come to this topic to rip on Krugman (Special K, the Bearded Clam, etc.), only to land on weird shit that makes Fonz sound like he's seen a UFO. I won't lie, my sister claims she and a friend were "tailed" by something odd when they were out driving at night while in high school. So what exactly did you see? Was it planes or what? You ever see that movie Cloverfield? Cause the fucking alien landed in the ocean, dude...

Thu, 04/25/2013 - 23:18 | Link to Comment fonzannoon
fonzannoon's picture

ekm is probably right.

Thu, 04/25/2013 - 23:20 | Link to Comment McMolotov
McMolotov's picture

Like I told another poster the other day, I live near an airport where the National Guard runs some kind of air support unit, and I've seen way more black helicopters than normal.

(Yes, I realize that makes me sound like I'm a loon, but the military does in fact literally use "black helicopters.")

I usually see a few a week, but I've been seeing a lot each day, doing training or whatever. Probably prepping for shit in Syria.

Thu, 04/25/2013 - 23:25 | Link to Comment dick cheneys ghost
dick cheneys ghost's picture

Ive seen the same thing where Im at. Military helicoptors twice in the last week......and we never see them......

check this out.....

http://www.dailymail.co.uk/news/article-2315007/Ukrainian-Rutgers-studen...

Thu, 04/25/2013 - 23:30 | Link to Comment McMolotov
McMolotov's picture

The official story has more holes in it than Sonny Corleone.

Thu, 04/25/2013 - 23:26 | Link to Comment Jena
Jena's picture

We live near a large Marine base.  Normally we're not in a flight path but the last few nights we've had helicopters flying low and fast overhead, sending vibrations strong enough to rattle stuff on the counters.  One just passed by, in fact.

We were sitting outside the first night it happened.  The dog went nuts barking.

Thu, 04/25/2013 - 23:33 | Link to Comment McMolotov
McMolotov's picture

I want to thank you guys for all this reassuring shit that makes me feel safe right before I go to bed....

Thu, 04/25/2013 - 23:39 | Link to Comment fonzannoon
fonzannoon's picture

I have not slept in a while, strange stretch.

Thu, 04/25/2013 - 23:41 | Link to Comment ekm
ekm's picture

It's because of the stocks you own, not the helicopter's fault.

 

When I used to own stocks I couldn't sleep either. Now I'm happily stockless.

 

This is what I'm really enjoying right now. Ahhh, life is good. Thank you God, thank you.

http://www.youtube.com/watch?v=l07oRR4u-rk

 

Thu, 04/25/2013 - 23:50 | Link to Comment fonzannoon
fonzannoon's picture

I've owned stocks forever. I'd lose sleep if i was stockless. Like Woody Harrelson said in Kingpin "I don't puke when i drink....I puke when I don't".

Thu, 04/25/2013 - 23:51 | Link to Comment ekm
ekm's picture

It's called ADDICTION.

 

I'm telling you, sleep is more important than food.

Thu, 04/25/2013 - 23:47 | Link to Comment McMolotov
McMolotov's picture

My mom would suggest warm milk, I suggest room temperature whiskey. No need to over do it, but sleep is more important than a temporary bout of insobriety. No one can function with insomnia. I've been there and it sucks ass.

Fri, 04/26/2013 - 00:17 | Link to Comment Jena
Jena's picture

Both of you are so right.  The brain can't function properly without sleep but it can go without food for extended periods of time.  Insomnia sucks.

Thu, 04/25/2013 - 23:45 | Link to Comment kito
kito's picture

full moon fonz.........................channel that weirdness into your bedroom with your wife......................

Thu, 04/25/2013 - 23:45 | Link to Comment fonzannoon
fonzannoon's picture

kito you are not that far away, take a good look out there.

Thu, 04/25/2013 - 23:50 | Link to Comment kito
kito's picture

im on the other side of the hudson...i just looked to humor myself...actually hoping to see something......but alas.....nothing................nothing on the social media sites about this???? you on the north shore or south shore??

Thu, 04/25/2013 - 23:56 | Link to Comment fonzannoon
fonzannoon's picture

Eh forget it. McMolotov is right I am putting my tin foil hat away and trying to crash for a bit. Catch u guys tomorrow. This cucumber bet must be stressing me out.

Thu, 04/25/2013 - 23:56 | Link to Comment kito
kito's picture

checking with my aunt in oceanside.........

Fri, 04/26/2013 - 00:02 | Link to Comment fonzannoon
fonzannoon's picture

unfortunately it's prob done by now. 

Thu, 04/25/2013 - 23:14 | Link to Comment sbenard
sbenard's picture

The Reinhart/Rogoff calc error was one cell in a spreadsheet that made a difference that was almost statistically insignificant. It was created long after the book This Time Is Different was written, and had NO effect on the vast amount of data and findings in that landmark tome. Just because we have not yet experienced a catastrophe doesn't mean one isn't on the horizon. Such an absurd assumption would be tantamount to saying that a woman having daily sex with a man will NEVER become pregnant, simply because she hasn't shown an increase in size THUS FAR!

Blodget and Krugman disregard these realities, declaring themselves the winner before the 2nd inning, thus not only revealing the true nature of their intellectual and academic prevarications, but also the vastly gaping hole in their characters as well. They are deceivers. There's no other way to say it!

We can not defy the laws of sound economics forever.

Eventually, one of two scenarios is certain. With our debt growing at 7-8% annually, and our economy barely breathing at a growth rate of .4% GDP, a day or reckoning is certain to arrive. Our all-consuming black hole of debt is 100% certain to create a house-of-cards event! Either:

1) the mounting interest cost will rise so high that it will eat us alive. We spent about $450 billion in interest last fiscal year, consuming about 1/4 of all individual income tax revenue, and about 20% of ALL federal revenue. that revenue has been largely flat for the past five eyars. At some point, we'll be paying so much interest that a crash in confidence will occur when global investors suddenly awaken to realize that we can't all run through the theater exit door safely. And/or...

2) inflation will rage out of control, crashing the bond and stock markets, as interest rates must rise to control it. But the rising interest cost will ultimately destroy us in this case also.

In either of their cases, a forced sharp cut in federal spending will suddenly be coerced rather than planned. The consequences will be calamitous, to put it mildly.

Reinhart and Rogoff will get the last laugh. Calamity is certainty. Plan and prepare accordingly.

Fri, 04/26/2013 - 07:34 | Link to Comment Flakmeister
Flakmeister's picture

You miss the point, R&R were simply another example right-wing fucks that *really* fudged the data to further their ideology. Making shit up is not a viable means of setting public policy and I don't doubt for a moment that their error was intentional...

The train that we are on ain't stopping even if you don't like the schedule or the seating arrangement...Get over it and try to enjoy the ride...

Thu, 04/25/2013 - 22:59 | Link to Comment Diogenes
Diogenes's picture

This morning I had a big breakfast then took a massive Krugman.

Thu, 04/25/2013 - 23:34 | Link to Comment Bear
Bear's picture

Those are some kinda vitamins ... the choke a horse kind

Fri, 04/26/2013 - 00:27 | Link to Comment LetThemEatRand
LetThemEatRand's picture

Krugman's biggest concern (that he won't admit) is low-flow toilets.

Thu, 04/25/2013 - 23:00 | Link to Comment Flakmeister
Flakmeister's picture

Face it, we are fucked no matter which course is chosen but I digress... 

I say print, cancer is best served with the opiates and those with physical should not care either way...

More than a few on the Right want austerity, it will help them shepard in a true police state sooner than otherwise....

Thu, 04/25/2013 - 23:08 | Link to Comment LetThemEatRand
LetThemEatRand's picture

I'm not your downvote, but the printing is going straight to the MIC to buy ammo/drones, and to the banks to buy gold.

Thu, 04/25/2013 - 23:18 | Link to Comment DeadFred
DeadFred's picture

The sooner the reset the better. The MIC and fiends get the money anyway, just don't give them the extra time.

Thu, 04/25/2013 - 23:33 | Link to Comment mayhem_korner
mayhem_korner's picture

 

 

The "Right" aren't the promoters of the police state, Flak.  You know better than that.  The centerpiece of the liberal agenda is controlling others. 

Fri, 04/26/2013 - 05:40 | Link to Comment Acet
Acet's picture

If you think that, you've already been defeated. Statists come in all colors.

Do you really think that the crony sociopaths who do their outmost to gather power into their own hands would not use the speech of the Right to justify their efforts at centralisation and increase in State power!???

Here's one example: the repealing of Glass-Steagal was justified with the argument of "freeing the markets" and yet years later you have Government giving support to investment banks (that would otherwise be bankrupt due to excessive risk-taking) because those banks hold billions in Retail's money in their Retail Banking operations as ransom.

And the exact same think was done with the ideals and words of the left: for example in the UK Thatcher moved millions of unemployed into disability benifits (which is supposed to help those with real need) so as to make her unemployment numbers looks better and don't let me get started on Blair, supposedly a left-winger (yeah, right!).

Wake up man: the wolves are all around us!

Fri, 04/26/2013 - 08:39 | Link to Comment mayhem_korner
mayhem_korner's picture

 

 

Bugs...don't confuse people with ideas.  Conservatism and statism are polar opposites.  Try reading Mark Levin's Ameritopia and John Locke's Seconde Treatise.

Fri, 04/26/2013 - 16:06 | Link to Comment Flakmeister
Flakmeister's picture

Your naivety seemly knows no bounds.... Or you have a very twisted definition of conservatism....

Sat, 04/27/2013 - 11:32 | Link to Comment mayhem_korner
mayhem_korner's picture

 

 

Don't try to argue what is beyond your ability to understand, cap'n Lib.

Sun, 04/28/2013 - 05:30 | Link to Comment Acet
Acet's picture

Libertarianism (or, as is known in most countries but has been twisted in the US, Liberalism) is the contrary of Statism.

Conservativism is all about keeping things as they are (i.e. maintain the Status Quo) and is in a different axis altogether from Statism - the former is about change, the later is about centralisation of power.

Even the word "conservative" itself comes from the Latin for "preserve" or "keep".

The natural opposition of Conservatives are Revolutionarians.

Thu, 04/25/2013 - 23:33 | Link to Comment DaveyJones
DaveyJones's picture

printing is a lie, to ourselves and others

we've had enough lies

 

Thu, 04/25/2013 - 23:12 | Link to Comment DeadFred
DeadFred's picture

It's good to be told we are currently experiencing "bliss". I would have missed it otherwise.

Thu, 04/25/2013 - 23:16 | Link to Comment MFLTucson
MFLTucson's picture

Hey Partner, a 17 Trillion dollar deficit, you can talk all the bullshit you want, Kenyan (Keynesian) economics is a failure! 6 trillion spent for a 2% growth rate if we are lucky and real inflation including food and fuel at 7 to 9%, real unemployment at 15% and 50 million people on food stamps is a financial success?  If your plan is to destroy America, I guess this is a success, good job Krugman!

Fri, 04/26/2013 - 00:19 | Link to Comment Clowns on Acid
Clowns on Acid's picture

Ummm...that is the plan. Obama said so....he just called it something different that the MSM ran with like a new reality tv show. 

Obama called it Hope and Change, and that was all that was needed.

Thu, 04/25/2013 - 23:28 | Link to Comment Yen Cross
Yen Cross's picture

  You guys are are going to kill  me.   p.c.

 

Thu, 04/25/2013 - 23:26 | Link to Comment Arthur
Arthur's picture

It all depends on what the debt is used for.  Bond debt for a toll bridge that actually leads somewhere and facilitates commerce should help the economy grow and much faster then if one had to save for a paid in full cash outlay.

The problem is when the politicians effectively use debt expenditures for projects that are designed to keep them in office rather then promote the "greater good"

I am glad I could borrow funds to pay for my house at 3.75% rather then plunk down the whole price, I have other more productive things to do with my cash, such as invest in my business.  

That the big banks seem  use  debt to fund rank speculation (gambling) does not make all debt bad.

Not say'in Krugman's "spend now "theory is sound, but it might be if the money is well spent and clearly much of the money is being wasted.

Thu, 04/25/2013 - 23:34 | Link to Comment Pareto
Pareto's picture

wtf means Austri-Keynesianism?  And just when I thought it couldn't get more ridiculous.  Which part is the Austrian part, and which part is the Keynesian part is equal to some folks will have to do without while others get to enjoy the status quo.  How fucked up is that?  You don't elect for austerity measures.  Its not a choice or an option.  When did we decide to make a commitment to dropping accountability and stewardship for moral hazard and free rides in perpetuity?  Its fucking goofy!  Basic first year economics tells you that the path both government and central banks have put us on is simply unsustainable.  And why the fuck do we keep glorifying Krugman as if he is and always has been the answer to 21st century capitalism.  Because nowhere in Keynes' Theory of Employment, Interest and Money does he ever say to go batshit crazy on both the money supply and unsustainable government spending.  Nowhere.  I mean does anybody really believe the fucking debt will ever be repaid?  Its never going to happen.  So, I am sure that when Keynes wrote his book, he did not have this in mind.

So, lets just call it what it really is - a big fucking social experiment purposely engineered to benefit the few at the expense of the many.  This isn't capitalism.  This is government given way to much credibility to organize and effect and efficient functioning economy.  That is all this is.  And when they fuck it up, and the entire social science project blows up nobody will be held accountable and I guarantee you won't find Krugman anywhere.  It'll just be us trying to muddle through catastrophy and impoverishment.  Like cleaning up after a big drunk.  Fuckers.  

Fri, 04/26/2013 - 00:28 | Link to Comment Anusocracy
Anusocracy's picture

What's going on now is basically what has been going on since the beginning of government.

Different psychopathic rulers, different servile morons, same outcome.

Thu, 04/25/2013 - 23:37 | Link to Comment Random_Robert
Random_Robert's picture

The only REAL argument between the Keynesians and the Austrians is whether:

A) Personal savings

or

B) Goverment induced credit

Are more valid (or effective) forms of capital.

 

It's still all about the collectivists/communists/socialists/aggregate demanders versus the individualists/capitalists/private and free marketeers. The premise of the arguent is so stupid I could puke -

Paul Krugman- until you can demonstrate that economies can grow and maintain health without the incentive of individually applied free will, this debate will not be over ...

 

Thu, 04/25/2013 - 23:38 | Link to Comment Yen Cross
Yen Cross's picture

    Tyler! you have one dead pixel on your home page! It's driving me " rabid sewer rat in an empty garbage can" Crrazy!

  It's top 1/3rd quadrant, right lower corner. Fix it please?    

     Cordially Yours'

Thu, 04/25/2013 - 23:48 | Link to Comment q99x2
q99x2's picture

Idiotic debate since fraud is not quantifiable. Morons I say.

Thu, 04/25/2013 - 23:56 | Link to Comment kito
kito's picture

nothing....NOTHING...would work at this point......austerity crashes the system.....printing crashes the system....but at least the austrians are smart enough to SEE THE SHITSTORM COMING......dumbfuck blodget cant see past his nose.............................

Fri, 04/26/2013 - 00:08 | Link to Comment LetThemEatRand
LetThemEatRand's picture

Well said.  Damage is done.  The debate should be how to prevent it next time, and monetary policy is a footnote.

Fri, 04/26/2013 - 00:13 | Link to Comment Dr. Engali
Dr. Engali's picture

Blodget is an idiot felon who didn't know what he was talking about when he was an analyst , and he has no clue now. We've added 6 trillion in new debt and barely squeaked out 1% nominal GDP growth. You're right nothing will save the system;the best they can hope for is postponing the end with further debt. Which leads me to the parameters of our bet. Before we set our bet I have a question for you. What is a U.S. dollar in it's current form according to your view?

Fri, 04/26/2013 - 00:26 | Link to Comment ReactionToClose...
ReactionToClosedMinds's picture

Blodgett is a self-promoring propagandist ...... anyone who takes his 'paid for' analysis seriously deserves to be fleeced.   Caveat Emptor de Blodgett (let the buyer beware of Blodgett if my latin still holds up).  

Try reading Joseph Schumpeter Henry Blodgett ... or is that too time consuming for your quick-hit tastes!?

Fri, 04/26/2013 - 00:36 | Link to Comment AchtungAffen
AchtungAffen's picture

Well, people have to eat every day...

Fri, 04/26/2013 - 00:59 | Link to Comment Yen Cross
Yen Cross's picture

 LONG, Hedgeless Horseman.  I'm rigging some "solar electricity".

Fri, 04/26/2013 - 00:59 | Link to Comment Manipuflation
Manipuflation's picture

Is there an echo in here?

Fri, 04/26/2013 - 00:59 | Link to Comment moneymutt
moneymutt's picture

More important than govt debt is private debt....see Steve Keen, private debt swamps govt debt, not even in same league, private debt bubbles and busts economies....

Fri, 04/26/2013 - 05:00 | Link to Comment falak pema
falak pema's picture

thank you very much for reminding us all that what has fueled this capitalist conundrum is the rampage in private oligarchy debt unleashed by Reaganomics and big bang financialista "science" of rampant toxic kind since 30 years. 

As ZH has so explicitly pointed out the mega socialisation of private debt, the subsequent QE-infinity and all the CB shenanigans since then, accumulating in 27% unemployment in Spain, death of economy in Greece, 100 million poor in USA, unbridled austerity still to come in first world, is a result of the ruling Oligarchy NOT WANTING to reset private first world debt in order to protect their own ponzied 30 T stash in Caymanista land. And its going on from bad to worse this rip off.

That wealth is the equity icing generated on top of the 1 quadrillion nominal shadow banked derivative pile up, indicator of the consequent private banking debt tsunami that will be unleashed if we ever SQUARE the books of OTC shadow banking zero sum betting. No government ledger has the ability to socialise that level of private debt a second time.

Its this runaway train we are sitting on today, whose fatal destination neither CB temporary sleight of hand can avoid in Keynesian pump n dump inflation of reserve currency nor the impossible economic growth of first world out of current doldrums can resolve as all cheap energy sources are now peaking and international labour arbitrage model is now socially stinking; as time goes by.

The only way out is concerted governance by Big Government in first world to force debt write offs on private banking oligarchy world and recycling of that private wealth back into economy, all the while curtailing severely the casino economy and flushing out the shadow banking system bigtime. We need to tax the rich, Glass Steagall TBTF and stop all derivative banking culture, then prosecute past crony capitalism in the law courts.

That requires a cultural reset of "we the people" meme including massive infrastructure, alt energy and pollution control investment.

That or Oligarchy imposed war.

Fri, 04/26/2013 - 09:24 | Link to Comment Oldwood
Oldwood's picture

True enough. Everything was going incredibly well under Carter. I remember paying 17% on my used car loan. "winning"!

Fri, 04/26/2013 - 11:02 | Link to Comment falak pema
falak pema's picture

Carter was not the answer but the remedy was worse than the post BW print n inflation blues !

Life is never ideal, but a matter of choices...and the great manipulator took us down that blind alley like the piped piper! 

Fri, 04/26/2013 - 02:28 | Link to Comment AldoHux_IV
AldoHux_IV's picture

Funny thing is everyone's wrong-- nothing in this debate has to deal with real growth especially in a debt based monetary regime. The ony thig that Rogoff and Rhinehart debacle proved: models don't mean shit and are only used to create some semblance of viability behind shamanism. Won't get to a greater truth of econ theory unless we break the austerity vs stimulus debate and start relying upon better metrics/monetary regimes to meausure econ prosperity and opportunity.

Maybe ZH is better off writing prose trashing Bernanke/Geithner ;) rather than perpetuate the flawed debate.

Fri, 04/26/2013 - 02:53 | Link to Comment Yen Cross
Yen Cross's picture

 

       I don't know about the rest of you "clairvoyants" , but it's well past my " New Porn Time"...  

  Flick it hard girlz....

 

Fri, 04/26/2013 - 03:44 | Link to Comment Keyser Soze72
Keyser Soze72's picture

Isn't it obvious that Reinhart/Rogoff study holds the same Keynesian premise? The premise that government spending leads to wealth and economic prosperity.

 

Let's imagine that the US budget would only be 100 million dollars. In that case would it be an important factor if the deficit to GDp was over 90%? Or even 900%? Of course not. 

 

Reinhart/Rogoff and Krugman share the same premise. Governements can provide ecnomic growth. Therefore, Reinhart/Rogoff are certainly no Austrian economists.

Fri, 04/26/2013 - 03:48 | Link to Comment Keynesian Mess
Keynesian Mess's picture

Kooky Keynesians like Krugman and his Kronies are right about infinite debt creation not really being a problem, but for the wrong reason. It also will not turn out to be a hyper-inflationary event either because, even if they don't realize it yet, all of today's big borrowers, both corporate and sovereign world-wide, will never pay it back.

Like the little borrowers of past crises - S&Ls, Asia, Argentina, Russia, and property mortgage holders - they will simply default. But these giant debt holders won't default until they've first used this mountain of unsustainable debt as justification to "Cypress" all of us. Stocks and bonds will be worthless, digital fiat will be confiscated and all other assets will collapse into the resulting deflationary black hole.

Make up your own mind, but my investments going forward are going to include a private suppy of food and water, a stash of physical fiat currency from multiple countries, junk silver, and hardware from Smith & Wesson and Remington.

I hope to see you on the other side of this mess in the second half of this decade.

Fri, 04/26/2013 - 19:53 | Link to Comment malek
malek's picture

You're mixing up your theories.

all of today's big borrowers, both corporate and sovereign world-wide, will never pay it back. Fully agreed.

they will simply default. Not agreed.
If it would really happen that way, yes it would be highly deflationary, as the remaining unencumbered dollars (or whatever currency) would rise immensely in value compared to the majority of defaulted dollar claims.
However, give me an example where that happened large scale especially for sovereigns. As you can currently see the proposed "solution" is to print more money, not default. There are no practical limits how much the Fed can print. There seem to be no political limits either, to the contrary it seems that's always the path of least resistance for politicians.
Result: very high inflation, potentially (but not guaranteed) hyperinflation.

all other assets will collapse into the resulting deflationary black hole. Define "all other assets". Many deflationists seem to have the fallback position that if the dollar doesn't run into deflation then exchange the yardstick and declare "but we meant deflation in other assets" (such as gold?).
So how would a deflationary explosion in the purchasing power of gold be different from a inflationary implosion in the dollar, exactly?

Fri, 04/26/2013 - 03:54 | Link to Comment luckylongshot
luckylongshot's picture

Throughout history there have been debt bubbles and as compound interest grows exponentially they did not get better over time. The only way these bubbles are resolved historically is through debt write offs. The Pharoahs learned this the hard way as those that did not write off debt were killed. That there are still arguments going on about which school of economics is right shows we still have a way to with this debt bubble. As austerity will not work and creating more debt will also not work arguing about which of these approaches is best is arguing about rearranging the deck chairs on the Titanic, ultimately pointless.

Fri, 04/26/2013 - 03:53 | Link to Comment luckylongshot
luckylongshot's picture

Throughout history there have been debt bubbles and as compound interest grows exponentially they did not get better over time. The only way these bubbles are resolved historically is through debt write offs. The Pharoahs learned this the hard way as those that did not write off debt were killed. That there are still arguments going on about which school of economics is right shows we still have a way to with this debt bubble. As austerity will not work and creating more debt will also not work arguing about which of these approaches is best is arguing about rearranging the deck chairs on the Titanic, ultimately pointless.

Fri, 04/26/2013 - 04:49 | Link to Comment css1971
css1971's picture

More debt just means more money.

Isn't it simply a case that because government debt is what we're talking about here, government is borrowing and spending in larger proportion to the private sector and therefore the "growth" in private debt (which is what growth is) is reduced proportionately.

Everyone keeps saying they want growth, but that literally means growth in private debt. Meanwhile, public+private continues to hit a perfect exponential curve. Who cares if it's public or private? The result is more debt and more inflation.

Seems like a shell game to me.

Fri, 04/26/2013 - 05:07 | Link to Comment XRAYD
XRAYD's picture

FAIR enough. But the real question in a democracy is - WHO suffers any pain because of "austerity" or benefits from Keynesisn spending, or Bernanke printing?

Alas, in dysfunctional democracies, such questions are never resolved in a "fair" and rational way. So the only out come is when for some reason and some how, what cannot continue comes to an end. How, when, and why exactly, is anybody's guess.

In the meantiime - may we please go onto DOW 36,000? I need to retire before the stuff hits the fan.

Fri, 04/26/2013 - 06:12 | Link to Comment Debugas
Debugas's picture

please define what is "excessive debt" !!!

when you borrow money at zero interest AND invest it productively it definately helps to grow the economy

on the other hand if you borrow at interest for pure consumption then the hangover is inevitable

Fri, 04/26/2013 - 07:04 | Link to Comment wonderatitall
wonderatitall's picture

this is bliss?... oh i forgot , obama is king, off with our heads

Fri, 04/26/2013 - 07:16 | Link to Comment MyBrothersKeeper
MyBrothersKeeper's picture

I agree that article was a joke.  To say Krugman has won is just plain stupid as we are now pumping 2 T with the Fed and govt deficit spending.  And what has it gotten us?  Record low labor participation rates, still stagnant employment numbers, higher gas/food/education/healthcare despite the official "no inflation" bs, and record levels of debt.....which, btw, stands at over 16.8 T and growing exponentially.  The media and others will have you believe this drop in bucket sequestration cuts is having a meaningful impact on spending....it isn't.  All the hype about furloughs etc is utter bs for mass consumption.  They coulnd cut 100 things and more than cover those cuts without impacting anything but they want people to believe the cuts are "devastating".

The govt still has no idea about how to prioritize spending and that 2 T a year is nothing but almost complete malinvestment.  I mean even if 15% was going into the real economy it would amount to about 300 B...which is 2% of GDP.  Take that away and we are on verge of recession.  So where is the other 85% going?  Malinvestment that is going to banks and other special interests...certainly not the middle class or anywhere where it's generating job growth.

Fri, 04/26/2013 - 07:31 | Link to Comment esum
esum's picture

why would one expect politicians to be interested in anything but short term solutions.... to any problem??. Their only interest is in enriching themselves at the expense of the taxpayer as fast as possible, throw out the diversionary issue like a magician does to divert the majority uninformed voters and repeat... term limits woudl be nice. one term and out. no lifetime pension. no exception from the law of the land... But its not going to happen... we are fucked unless people wake up..

Fri, 04/26/2013 - 08:22 | Link to Comment RaceToTheBottom
RaceToTheBottom's picture

Blodget?  Why should we listen to that criminal?

Fri, 04/26/2013 - 08:37 | Link to Comment ginunn
ginunn's picture

Debt/GDP is a reb herring. What matters is debt sevicing cost/GDP. It's all in interest rates.

Fri, 04/26/2013 - 08:58 | Link to Comment MyBrothersKeeper
MyBrothersKeeper's picture

Which is why, despite the jawboning and talk of bond bubbles, the Fed isn't going to be raising interest rates.  They can't.  But that won't stop them from alluding to it to try and get people into more riskier assets.  With unemployment treading water the Keynesians are out of ammo.  Their manipulations are not driving rates sustainably higher.  What happens when there is no longer any money to pump equities directly or indirectly? Gold is likely to head lower again as the dollar will stay inflated vs Yen/Euro etc.  They are trying everything but nothing is working mostly due to the fact that they have no idea what the real problems are. The Gov't see themselves as the solution without realizing they are the biggest part of the problem.  But the chances of them ever admitting it are zero....so on and on it goes.

Fri, 04/26/2013 - 08:55 | Link to Comment neutrinoman
neutrinoman's picture

Yes, the debate is over -- Reinhardt and Rogoff are still right. Their charts and tables (in the book) show it very clearly, and you don't need Excel spreadsheets to get their major points.

They use several metrics to gauge debt levels; public debt-to-GDP is only one. Actually, the most compelling and strongest metric is debt-owed-to-foreigners versus capital account surplus/deficit. Here, the US gets away with its debt levels only because of the dollar's reserve status and special status of US Treasuries as the basic asset of the debt-based, post-Bretton Woods system. No other country can get away with this, not even Japan.

It's tiresome to keep hearing Krugman and the other neo-Keynesian cranks trumpeted as geniues or experts. Neo-Keynesianism was discredited 30+ years ago. It survives on today for strictly political reasons, not economic. The austerity situation in Europe has nothing to do with Reinhardt and Rogoff, in any case. It's come about because the surplus northern countries can no longer extend growing credit to the peripherals. All the major European banks are insolvent, and Germany can underwrite no more, essentially. Bankrupt sovereigns lean on bankrupt banks, and vice versa. R&R's work is irrelevant to this situation, although it does provide yet another example of what they were talking about.

BTW, Reinhardt and Rogoff are not Austrians, and the debate isn't as bipolar as A vs. K. The Austrians have contributed their theories of bubbles and misallocation of resources (malinvestment), which many non-Austrians use even if they don't accept the full Austrian theory.

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