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Quote Of The Week
Presented without commentary:
"The central irony of financial crisis is that while it is caused by too much confidence, too much borrowing and lending and too much spending, it can only be resolved with more confidence, more borrowing and lending, and more spending."
Larry Summers, source
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Huh?
Larry Summers. Now there's a name you don't hear very often.
Unless you're standing by the water cooler talking about villages that are short staffed.
Not fair. Larry was able to look away from Timmy for not having the skills to drive turbotax. (Keynes said taxation had no other purpose than social engineering/data collection)
I doubt Obama(2nd term) or Ron Paul (1st term) will be so forgiving.
A jerk off said what.....?
I think he said somthing about confidence games ..............
Haha Professor Summers sums up the irony very well. In fact, this seeming paradox often confuses the less rigorous thinkers among us, who claim that Keynesian economics is not logically consistent. But of course, this realm of economics is reserved only for the most esteemed intellectuals and hence it is bound to escape the feeble minds of doomer libertarians. Those who can master this elite field of economics have proven themselves worthy of political power, so that they can tailor America’s economy for optimal prosperity.
Huh?
So you agree with Summers? The problem will be solved by doing more of what caused the problem?
If that is Keynesianism in a nutshell then I hope you like cake.
Your interpretation is wrong as usual. The principle of Keynesian economics is to correct the imbalances in the economy caused by ignorant free market participants who mis-allocate resources. The government is responsible for reallocating these resources more efficiently, under the guidance of top economists, in order to correct the mistakes of the market. For maximum prosperity, resources need to be distributed according to the preferences of PROFFESIONALS only.
Your sarcastic wit escapes some on ZH but there are plenty of us who are ROFLing!!!! Thanks MDB
Definition of sarchasm :.(sär'k?z'?m)
1. (n.) The abyss between the creator of witticisms and the intended recipient who does not find the humor in it.
I'm beginning to love this guy MDB.
I can get to bed earlier now and skip Kimmel. I get all the laughs I need from reading his posts.
Once you understand his MO, he's quite funny...and eloquent too!
The central irony of the financial crises is Larry Summers
Larry Summers "intellectual" insights are the black hole at the center of the universe from which there is no escape. The only hope humanity may have is to load Summers, Geithner, Greenspan and virtually any mainstream economists and politicians into a torpedo, eject the warp core towards the black hole and then fire said torpedo at the warp core and hope the blast will be sufficient enough to throw us clear of the soul crushing force of this horrible and otherwise inescapable feeding machine that is the global economy!
You are ALL WRONG.
Summers is correct.
Let me explain how- the ONLY way to fix the problem of not growing is to grow more. That is precisely what summers is referring to, whether he knows it or not. We're in an economic model that TOTALLY DEPENDS upon growth. All of the expectations that every one of you has is predicated upon a growth model. All that you have, are, and know comes from that.
The reality is that we cannot grow and that means there is no solution. Every person who thinks that there is some magic prosperity going to break out as a result of undoing all the bullshit over the past 40 years is a fool. We can't just go to a gold standard and have prosperity. We can't jail all the banksters and have prosperity. Confidence is down for GOOD REASON. It is because there is an undercurrent of collective point of recognition that there is contraction in the future, NOT growth.
Jailing bankers and gold standards and Glass-Steagal won't resurrect declining oil fields.
You're absolutely wrong; there's a very good solution to all the problems!...
Decrease global population to under 1 billion.
Ok. Just for fun and assuming that you are serious (God why doesn't someone invent an "Irony" font?) exactly which selected people will be lucky enough to increase the well being of the planet and its people, by no longer being a part of it?
Its very simple: those that can provide for themselves get to live; the rest die. I believe its called natural selection. The upcomming scramble for food, water, energy etc should provide an ample contest and a good contest...
Ok, so - 'First, and perhaps most fundamentally, credit standards for those seeking to buy homes are too high and rigorous in America today. This reduces demand for houses, lowers prices and increases foreclosures, leading to further tightening of credit standards and a vicious growth-destroying cycle.'
So tell me, how does credit standards being too high lead to INCREASED foreclosures?
this guy just makes it up as he goes along, and no one seems willing to stop him or even point out his infant grade errors...
Ok. Sounds good. According to your plan if I can provide for myself by being on the correct side of sufficient weaponry, and you are on the wrong side of my weaponry, I will provide for myself at the cost of your life and so on and so on until there are too few people left to try and take what is mine and then I get to live and you are dead!
What an unbelievable plan!
How do you find time to come up with all of this between your busy schedule of writing speeches for Summers, Paulson, Geithner and Michelle Bachman?
if you study animals they use many techniques to pass on their genes; some have shap teeth and amazing hunting skills; some out breed others; some have stength in numbers; some have great ways to find food. The crocodile has survived millions of years due to its amazing hunting skills and ability to defend its terretory, in spite of its small brain...
I foresee a stronger human race once the chaff has been cut away - natural selection is a poetic form of justice...let the stongest win!!!!!!!!
Utter horseshit. The solution to 'too much confidence, too much borrowing and lending and too much spending ' has historically always been BANKRUPTCY.
People on this site don't seem to think that undoing everything will bring prosperity as you say. They talk about buying guns andf holing up for christs sake. They know the system is dead, that it cannot perpetuate because no one can now make the payments. The solution to someone not being able to make the payments is not 'more confidence, more borrowing and lending and more spending, ' which makes you wrong, everybody else right and Summers a bloody fool...
What you say "feels" right to you because you believe we exist in a rational economy. And to be certain, most of what we see around is somewhat rational. There is nothing irrational about you going to work, your employer providing you with a paycheck, you using your paycheck to buy goods and services, etc. But the monetary system that supports that rational existence is completely irrational. And that is what Travis is talking about, and he's absolutely correct (as is Summers, whether he realizes it or not). The rather unholy combination of fiat/debt currency and fractional reserve banking (our monetary system) requires that aggregate debt be in a perpetual state of growth. When the system reaches terminal velocity, the system will crash. Everything our central bankers have done for the past X number of years is nothing more that prolonging the inevitable collapse (real collapse). What Travis says is 100% correct.
yes....and the reason "fiat" like we have is still worth something is because the debt is to be paid back with future growth. There is somewhat of a match between a debtdollar and some "thing" out there in the economy upon which a claim can be laid.
Take the economy away and the debts aren't worth much.
Afraid not chaps. What I say 'feels 'right because it is. You can lie about your assets for only so long, but then when someone wants their money out you are faced with the reality of having to return it.
Is Summers is correct then explain the bit where if an asset of house rises by 3% and the cost of borrowing is raised to 5% as Bernanke did then commercial borrowers are forced to produce an accounting loss and sell, even in a growth market. That has got nothing to do with what Summers says and in fact completely undermines it. There is no such thing as an infinite growth spiral which is inevitable if we follow Summer's logic.
and Trav, the debt will be defaulted either through write-off or debasement. there is no repayment from future growth, ever. Look around you at all this infrastructure. How much of it do you think has been paid for? None of it. The debt is simply sold on and traded for a margin by bankers because it cannot be repaid. It is utterly worthless and will be written off eventually. To say that a bankrupt can be made solvent by giving him more money is dreamworld stuff. Though I hear what you're both saying the logic is fundamentally flawed.
I can't speak for trav777, but I don't think you are disagreeing with us (with me anyway). My position is that what we face now is what we have always faced and is completely inevitable based on the system we have selected to facilitate economic growth. We can't avoid the total collapse of our monetary system. We can let it collapse now or continue to pretend (as suggested by Summers). Our monetary system is the very definition of a Ponzi scheme. There is a real economy in the middle of this, somewhere, but even that continues to be perverted by an irrational monetary system.
I think we do agree, but my position remains that we are in collapse now because we already have pushed it as far back as we can, and that it can now go no further.
Only a lunatic like Summers could suggest that this system is in anyway plausible. If you need to borrow this year to plug a deficit then you need to borrow next year to plug that same deficit AND pay the interest on this years debt. There's no way it can work...
You three were all making the same point. Trav was saying that the only possible fix was what summers said, a continuation of the fiat growth model, but this is impossible. He's only "right" insofar as he proposes the "correct" solution for a broken model.
I can't argue with the position you have explained us to be in currently, but NEVER say NEVER. It may not happen tomorrow, or even 10 years from now, but empires don't last forever. If the people continue to wake up and understand that there is no simple solution to the problem unless the entire system changes, they will eventually rise up and overthrow the system. All it would take would be an accelerated awakening and our military and police to stand down and stop listening to TPTB.
The ONLY way to fix the system so that it is fair for all, not just the super wealthy in positions of control, is to have debt forgiveness and reboot the system into something new. Talking only JPM and BOA, they have around ~150T toxic derivitives on their books alone (all US banks is probably double this, check the latest OCC report). US GDP is only 15T and all govt Debt can be paid off at 15T. All home mortgages in the US can be paid of for around 15-16T. All student debt can be paid off for about 1T. It becomes obvious for folks to see, this is a ponzi scheme beyond belief where profit is never shared, but losses are being piled onto the taxpayer at an alarming rate.
For Greece, the fact that PRIVATE investors had to take a 50% haircut this time shows the reality and is a step in the right direction. Just like Iceland has shown us...most of the debt is not the peoples debt, the debt lies in the mega banks because of thier risky financial instruments and they are simply looking for a way to lay it on the peoples backs. As long as we have central banks willing to keep peddling cheap crack money to keep these junkie institutions alive, the problem will contine. Let's hope the people are getting smarter and we will be able to eventually put a stop to it. Americans have generally been slobbering idiots following the propaganda fed to them, but many have woken up in the past decade or so, so that does give me some hope that we can't say NEVER.
@ Hidingfromhelis:
The frisson is measured by the gap between entertainment and the desire for political action. Not saying there can't be both...
There is a difference between loaning money at interest, and investing and receiving a dividend.
Money loaned at interest WILL be repaid PLUS interest, regardless if the borrower is profitable or not. Courts, governments and central banks guarantee that all loans will be reapid with interest, so if anything ever goes bad with the borrower the printers will print the money to give back to the lender. This is our current system in a nutshell.
Money invested may or may not be repaid and may or may not receive a dividend payment. If the borrower succeeds then the money put in as capital deserves to be rewarded, if the borrower fails then the money put in deserves to be diminished. That is capitalism in a nutshell.
While it seems like a no-brainer that our current usuary system where "failure is never an option" appears to be less risky than capitalism where your money is always at risk... the truth of the matter is that it when there is NO RISK you get people making stupid mistakes but society has to pay for those mistakes. With capitalim you still get people making mistakes, but they pay for their own mistakes - and then LEARN FROM THE MISTAKES! There is no learning from any mistakes in our current system - which is why it will blow itself up in one cataclysmic intergalactic explosion, taking down most of humanity. Now which is better?
Reading assignment:
HOW AN ECONOMY GROWS AND WHY IT CRASHES ~ PETER SCHIFF
http://www.amazon.com/How-Economy-Grows-Why-Crashes/dp/047052670X
Won't matter. Oil supply has peaked...if this is THE PEAK, then it is the peak for ALL TIME. Do people really have that much trouble accepting this?
What it means is that all of this crap, stimulus, economics, all of it, was a mfing MIRAGE, as was all of our "confidence," our expectations, what we thought was real, and our understanding of the "social compact."
We either hail mary with fusion power or we contract. The debt overhang will make that contraction severe but no more severe than when the next batch of demographics realize that there won't be a bigger pie to fight over, but a smaller one.
Expectations will have to adjust...we are proceeding toward a feudal society where social and economic strata become really more fixed than this "American Dream" crap led people to believe.
Trav, oil supply is about to go balistic.
Oil demand has peaked now that credit is contracting and prices are soon to rise.
The excess will soon flood a global market terminally prone now to over supply in the very near future.
uh...supply is falling, not rising. You may mean to say that there will be increasing slack capacity; if so, say that
same thing...
philgramm,
it appears Larry Summers never got the joke ;.
I've noticed before that many Americans don't seem to understand sarcasm. Might be because of the "Quality" of US sitcom "Humour"?
Most americans barely know how many states there are.
Even fewer non-Americans actually care...
Ditto.
Best "troll" ever...his material is classic, worthy of a book I'd say
Mr. Used Car Lot Auto Salesman (aka Lawrence Summers, PhD., MBA, BA, BS)
you cultivate a look that oozes Trust Me
Bud Light Real Men Of Genius Salutes YOU!
http://www.youtube.com/watch?v=yGY8wUEmws0
Lol! Good stuff!
Bravo ! this is your best post yet.....
MillionDollarBonus_
Your understanding of Keynes is a little thin my friend. Perhaps you should take up knitting.
MDB you have out trolled yourself, you have taken stupidity to new heights, you sir have gone "full retard".
The Bernak has shared his, Larry and Timmy's favorite song with the ECB, and no it's not Kumbaya:
http://www.youtube.com/watch?v=vdED3rVgIu4
@million....
Can't help it, I'll take the bait.
On your next colonoscopy, have the doc keep an eye peeled for a misplaced economic text book. Somehow, yours appeared to wind up in the wrong place.
How disappointing that twice as many ZH'ers miss it, vs. get it.
Get what?
i think the use of capital letters toward the end of the post is very deliberate... MDB has advanced training in marketing, more satire.
this is ricky gervais here.
You are scary. Can you see your tonsils, cause your head has got to be up your ass. The only reason the market ever misallocates is because of government regulations.
Who is to determine what prosperity should look like, and who is going to determine who these PROFESSIONALS are?
Almost NEVER post. Have seen your posts before. Am a BIG fan. Really witty. Well written. Always a giggle. Thank you!
MllionDollar Bonus,
Your lame Keynesian theory states the market does not make mistakes, the market is never wrong, it is the participants who do, but at the same time, the consumer is rational.
Keynesian theory is circular, at best.
Ha! Hair of the dog. Bitchez!
MillionDollarBonus_
Love the consistency of your reasoning. You and Larry should shack up together.
(A) One glass of water will slake your thirst.
(B) Ten glasses of water will give you a belly ache.
(C) Ergo- to cure the belly ache you drink a barrel of water.
What a fucking nitwit. Leo....
MDB...'Professional' MORON, no doubt!...not to forget Larry Summers as well.
The theory that debt can be paid off with debt has titillated & vexed Harvard economists for decades...lol.
Well.... passing their debt onto others... passing Bankster debt onto the public.... today's debt financed consumption passed forward to your children and grandchildren...
Of course, by this sleazy standard, more debt works... until it collapses.
There is always a price to pay today (devaluation/inflation) as well as the interest later. Unbacked currencies die these deaths very slowly.
Keep stackin ;-)
I do hope commonsense will prevail. One relative of mine went back to the land a few years ago. Gardening and fishing. And recently chickens. I asked her why she wasn't selling her excess eggs - but she is:
here has been a lot of controversy here lately about selling eggs. Supposed to be graded and what ever else. For the little guy it's too costly to buy all the equipment so small egg producers are getting away with it by selling the cartons and giving the eggs away.
I love it. Brilliant. And how capitalism is supposed to work.
But one big caveat - buying your food in a major store - yes I do think there should be some regulations because you don't know where it is coming from. Buying locally you can check out the producer.
"I do hope commonsense will prevail."
Same here...but it ain't lookin promisin...lol.
I moved to "the sticks" in the early 90's. Its a different lifestyle. The people are honest, they all know each other and look out for each other without "getting into your business". It took about five years to be accepted because I'm a little different ;-)
What you say is true. Its not for everybody. Some people just have to have that Grade AAA stamp to feel they are "protected"...when really all you have to do is cook properly. We have alot of farmers markets around here, the taste of the produce sets my friends back when they come up. The meat is the same way.
To get the very best involves getting dirty, smelly or sometimes even bloody, as it should be.
Agreed.
You might like this: http://www.ted.com/talks/gever_tulley_on_5_dangerous_things_for_kids.html
lol...there's a lot of truth in that.
Kids have to understand the consequence of their own actions., both sides of the consequence. The good & the bad. Its how they grow up to be responsible adults.
And believe me...there is nothing harder for a parent than watching them do something that can have a bad consequence so that they understand both the joy of accomplishment and the potential for it to turn out very bad at the same time.
Any parent who has ever simply watched their kids climb a tree goes through it...lol...you don't want them to get hurt...but you have to let them do it so they learn for themselves about their own agility, strength and endurance...their limits.
I feel I was lucky to grow up in a time and place where parents (honestly) ignored their kids. And yes my older brother did covince me that sledding down the garage roof would be fun. And it was until the broken ribs! But yes learned a lesson.
lol...the exhilaration of slipping the bonds, the pure freedom of knowing it, touching it almost, if for only for a few seconds...followed by the crashing reality and consequence of experiencing it.
Yes.
Sometimes its worth it ;-)
MDB
Your atomic number is 5
Due to the ennui or to the number of neutered brains he's captured?
It's kind of like Huntin' and Killin' with Jimbo and Ned:
"So you see, we have to kill animals or else they'll die."
http://www.southparkstudios.com/clips/150462/huntin-and-killin
Time-waster troll.
When you realize the "jerk off" was once the president of Havard University you start to understand why so many college graduates are too skillless to land a real world job.
snarc (to both of you): This is so not true. Timmay does not know how to do his taxes. Should he bow down and not take the position of cheif inspector of the IRS? of course not. Those were the old ways. We can make jobs anyway we want.
Tim Geitner knew how to do his taxes. Nothing wrong with Turbotax. Tim just decided to leave out the IMF income as many people there did, hoping the IRS wouldn't know the rules for that International Organization. Larry Summers: The great irony of the financial crisis is that Summers could come back to land a powerful job in the Obama administration after he, Rubin, Greenspan, and Leavitt together with Phil Gramm, set the crisis in motion back in Clinton II. Summers is Econ aristocracy, having Ken Arrow and Paul Samuelson as uncles. Yet his mathematical skills were never joined to a political wisdom beyond simple opportunism, a skill he mastered long ago.
See that starts to make sense to a (non-snarc) unsophisticated person like me.
Also, wasn't Gramm also one of these guys who also had a knack for charging forward as a part of government (Senator-TX) to create something that government had no way of possibly regulating (SEC vs. the end of Glass Stegal) and then not only absconding from his role as a sworn representative of the US Constitution, but also kinda ditching on his citizenship as well by taking a senior role in a swiss bank?
I am honestly not trying to be snarky. But I am trying to undertand what that nerdy guy meant about the "giant sucking sound" in the election vs Cinton and Bush I.
and what he meant by this 'First, and perhaps most fundamentally, credit standards for those seeking to buy homes are too high and rigorous in America today. This reduces demand for houses, lowers prices and increases foreclosures, leading to further tightening of credit standards and a vicious growth-destroying cycle. '. Stunning, absolutely stunning.
How the fuck does credit quality being to high lead to increased foreclosures?
and this guy still gets to go on telly...
When you realize the "jerk off" was once the president of Havard University you start to understand why....
...EVERYTHING highly respected is bullshit.
More Keynesian drool from Larry
This world's biggest fool is scary
With Greenspan and Rubin
Our butts they were lubin'
They would be so cool to bury
I was having a chat with my left nut earlier, and I very quickly realized that it was smarter than Larry Summers.
Good work.
But I thought the world's biggest fool was Barry.
AHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH! Summers is such a fucking douchebag!
It just dawned on me.
There's theory and there's practice. And sometimes, the theory is a little askew when applied in the real world, as in just doesn't work. To wit, an example Larry's logic applied real time....
http://www.huffingtonpost.com/2011/10/27/donkey-prostitute-zimbabwe_n_1035194.html?icid=maing-grid10%7Chtmlws-main-bb%7Cdl9%7Csec3_lnk2%7C108221
I'm glad you kept it humorous. For a moment there I thought you had sunk so low as to fact check his statement. The practice has no place in the real world and should remain a domain for the fringe lunatic blogs.
In my greatest tradidiotn of professional research, I didn't factcheck the article, either. But then again it is Zimbabawe and .....
"Is this your homework, Larry?"
"Do you see what happens, Larry? Do you see what happens when you fuck your country in the ass?!"
You want a toe? I can get you a toe, believe me. There are ways, Dude...
"I can get you a toe by three-thirty. With polish"
"I'm stayin. I'm finishing my coffee!"
Do you see what happens, Larry? Do you see what happens when you fuck your country in the assets?!
There, fixed it for you.
Not sure if that should be the definition of insanity or stupidity.
It is neither. As B9K9 describes below, the system is led by a series of Masters. Who knows if Larry is in the inner circle, but he cetainly is in the game. He's one of their spokespeople. While the system is in-place, spokespeople are paid well to carry the water of TPTB. It is a lucrative position. And it is always best to choose someone that actually believes some of the things that they say.
Remember, TPTB will do whatever it takes to keep the system in place. Murder, genocide, enslavement, are just the price the little people have to pay.
You could argue that he is evil, deceitful, etc., but he is neither insane or stupid. He is playiing his role to a "t".
Presumably the "t" stands for TWIT.
Substitute an "a" for the "i".
Fixed it for you
You mean TWAT?
TPTB will do whatever it takes to keep the system in place.
True, but their main job is to keep people thinking it is necessary.
Once people realize that the state itself is a scam, the game ends, no matter how many cops their try to order around.
Who knows if Larry is in the inner circle,
He's not. Apart from his obvious lack of savvy, he is quoted often. The inner circle is not made of household names/sock puppets. His spouting is a tell-tale sign he is NOT in the inner circle of anything, except maybe Million Dollar Bonus's inner circle j*rk.
That quote was from the master of bullshit, next question ...
This passage was actually translated from the Arabic, from Khalid Sheik Moharvard ( Wm. Banzai, I recall, has the mugshot ).
http://www.zerohedge.com/article/updated-al-ponzi-group-most-wanted-list
Ha! I missed that. One of WB7's best posts, IMHO.
Thanks.
Huh??? mm..
almost, better like that:
"The central irony of financial crisis is that while it is caused by too much fraud, too much confidence, too much borrowing and lending and too much spending, it can only be resolved with much LESS confidence, SOME borrowing and lending, SOME spending, and much LESS FRAUD."
With stupidity, the manner that Central banks tHINK, never will be out of THIS FRAUD CRISIS !!
snarc: I doubt you have a MBA,PhD or JD so I am going to junk you to make sure.
The central irony of the financial crisis is that Larry Summers isn't dumpster-diving for his meals.
If money is borrowed into existence at interest, where does the money to pay the interest come from?
Answer that question and you will know while a credit based economy is absolutely unsustainable. There will NEVER be enough money to pay off the debt. It's mathematically impossible.
- if by 'resolution' he means making whole the friends who lost money when the bubble popped
I'm constantly astounded that even at a place like ZH, many people still apparently don't understand what the PTB are all about. I believe the central problem is perspective; that is, viewing these events from the prison of their minds, which has been carefully constructed over each person's lifetime.
The solution is to look at the problem from a different angle - that is, the Chosen's point of view. From this angle, we can see that usury, in all its glory, is the one consistent tool in which to enslave men. Governments are no fools - on the contrary, they not only understand perfectly well what is transpiring, but in fact exact tribute via outright extortion. This relationship has been ongoing for thousands of years - it's completely SOP.
So now we have two parties, joined as co-conspirators to form a more perfect union, that is designed above all to WIN. By winning, I mean amassing the most money, nailing the best pussy, eating the best food, and, when bored, fucking with people's lives just for the sheer hell of it. But the one critical problem they face is that the system, which entirely vests their power, is inherently unstable. If it doesn't grow (ie debt expands) organically, then it must be massaged & managed to grow via artificial means.
That is the point that Summers is trying to make. Indeed, it is completely 100% accurate for him to say that the only way out for the PTB is that consumption & debt must, at all costs, begin to grow again. This is the danger they face around the globe - that we may have some how reached a terminal point in credit expansion. This cannot be allowed, for obvious reasons, so governments & bankers alike have no problems dropping the veil - at this critical juncture, it's all or nothing.
+1 B9
Well said.
Can someone explain a viable substitute for usury?
Not usury.
For the sake of clarity, when I say usury, I'm refering to normal, interest-bearing loans. Not loan sharking or anything like that.
So, are you against all usury? No loans? Or just certain types of loans? Can you clarify what you mean by "no usury"?
Without credit, how does capital diffuse itself into the masses? How would a civilization grow?
I'm just trying to understand how libertarians think, and the notion of a society with no credit is fascinating.
I personally am coming to the conclusion that credit/debt is a cancer on society, and socially destructive, counterproductive and fundamentally unnecessary probably 95-99% of the time, if not completely.
WHY should we unquestioningly accept the premise that credit/debt is good, and that it is healthy and productive to be shackled by debt? What is wrong with SAVING first, THEN producing --- why does debt automatically have to be a part of the economic equation? Isn't the widespread use of debt merely representative of short-term, pay-more-in-the-long-run irresponsibility --- as well as a method of exploitation and control by the power elite? I know that everyone today wants everything now, Now, NOW, but I feel that the increased use of credit/debt in our (American/Western) society is merely another reflection of the growing juvenilization and shirking of responsibility so widespread today, as well as just another symptom of the willingness of an increasingly apathetic and ignorant public to be victimized by a parasitic and sociopathic financial and political elite.
Akak,
You have repeatedly demonstrated a profound ignorance on matters involving the economy, especially the subjects of inflation and deflation. Fuck, you think deflation is a myth, which is amazingly retarded. If you can't even wrap your brain around the concept of deflation, what makes you think I'd care about your thoughts on credit?
Even here, in this discussion, you're being an idiot. For you to think credit has no place in society is just whacked-out stupid.
The only subject you've demonstrated any semblance of proficiency is low-brow vulgarity and run-on sentences.
After being soundly discredited in EVERY thread in which you have deigned to make a stab at an honest argument, much less shooting yourself in the foot by supplying data in our deflation debate which directly contradicted your own argument in support of said supposed deflation, I am almost surprised that you dare to show your metaphorical face in this forum. But after having changed your handle on numerous occasions, and then each time (at least initially) pretending to be a different poster instead of the same tired and hateful troll, perhaps I should not be too surprised at all.
Let's review some of your many troll sockpuppet handles here, shall we?
WilliamtheBastard
LongJuanSilver
RedneckRepugnicant
TexasGunslinger
LibertariansforProsperity
And I am probably missing one or two that I have since forgotten.
Now, let's ask ourselves, is this pattern of repeatedly trying to change identities within a single forum the mark of an honest and sincere poster? I think the answer to that question is rather clear, and not in the affirmative. And it is worthy of note that under at least two of those handles, you were banned from this forum (an almost unprecedented action) for your egregiously antagonistic, hate-filled, bitter and diversionary antics against other posters, notably tmosley, who called you out in your lies and trolling even more than I have, and whom you stalked outside of this forum and even directly threatened.
By the way, I notice that you did not even attempt to challenge my questions or points above, but merely resorted to your usual red herrings and ad hominem attacks. You truly are a profoundly stupid and disingenuous troll, whose only talent has been in getting under the skin of those who challenge your lies and misrepresentations. What a sad and pathetic loser you are.
Why do you allways attract the people that have just completely checked out of the reality hotel?
Good question. Yes, that does seem to be the case, just as it was with tmosley (who has mostly relinquished his role as Master troll-smiter here, to spend more time on Turd Ferguson's site where trolls are summarily banished). Perhaps because I have zero tolerance for their disingenuous and malicious tactics, and am not shy about challenging them and calling them out on their disinformation, falsehoods and juvenile bullshit.
Get him.
They have zero sensitivity to you. I'm talking fucking zero. They always go straight to ad-hominen attacks and they do them with all the precision of an 8 year old that has been locked in a closet since birth.
It's like you've really pissed somoene off and they are just tribecheting dead cows at you with zero prepping or training or information. Whoever it is is one ego extension surrounded by fucktards mother fucker.
I have no sensitivity to you. I can usually pick up a mars aspect that lays down a challenge but it's being entirely focused on this dead pool of fucktards. The only thing I can think of is you must of fucked some bullshit rappers head up because they are usually the ones carrying those energies and said rapper must have surrounded himself with the most clueless fucks ever.
Turd has Trolls? I hope he gets rid of them. I heard they can cause cancer.
Akak just gave you a concise statement about how loans are not needed, and how we could save our wealth before making purchases, and you ad hom attack him. You are a weak and disapointing fighter.
This was a reply to Lebertarians... on the first page. I have no idea how it got here, but there you go...
That will be you telling everyone else that they're wrong again then. Surprised you didn't tell him he had scored an 'F'grade again, or that he was simply quoting cliche's and other jingoisms.
So once again the floor is yours, if you wouldn't mind sharing with us your enlightened explanations of why the contrary is true, but then you have no idea really, have you? Which is why you never take anybody up on the offer...
Floor's yours...
Debt is fine for "net producers" but not for "net consumers". Individuals/companies/countries who are net producers use debt to leverage (multiply) productive capacity. Debt used by those same entities for consumption works in the opposite direction. Meaning debt consumed without productivity results in greater multiples of debt -- i.e. Greece.
First, I don't even know if I'm a libertarian or not....I have my own views and opinions and form them independently, and will change them if new information requires......yada, yada.
No usury = no 24.99% penalty credit card rates, higher in some states. That's how I would define usury.
A mortgage at a competitive rate, what about 4% now....fine if you want the loan.
For myself, I don't need any credit and RARELY trade on margin. If I do, have agreed to pay the interest.
It's when credit is extended for "life support" that can't be lived without: food, medicine, shelter...and the lender can exact whatever rate he want's knowing the lendee will pay it to survuve that it becomes a problem. I'd just give them the cash, and I have.
There's a homeless guy on a freeway I drive pretty frequently. I give the dude $5 for the entertainment he provides. And he does. He once had a cardboard sign that read "Children stolen by ninja's. Need money for karate lessons." He always waves at people, guys been there for years, probably does pretty good. One time in traffic...line of cars passing by, I was behind a cop and he stood to attention and saluted him. Even the cop was laughing his ass off and gave him some cash.
If I expected that guy to pay me back at interest, that would be usurious.
imho.
.
Where are you from, the Middle Ages?
u·su·ry
1. the lending or practice of lending money at an exorbitant interest.
2. an exorbitant amount or rate of interest, especially in excess of the legal rate.
3. Obsolete. interest paid for the use of money.
civilization grew in the absence of interest banking, moron. The biggest scam perpetuated by economists is that banking and credit CAUSED this, when anybody who looks at a plot of "civilization vs. time" can see a gigantic spike at the onset of the Oil Age. Energy did this, not banking.
capital diffuses to the masses through wages.
You're really not this stupid but you do a good job of pretending to be.
@Trav7777
You're simply wrong. You cannot reduce everything to oil; it's far more complicated than that. To my original point, banking was/is absolutely fundamental to civilization's prosperity.
For virtually all of human history, prosperity and economic growth was non existent. At best, you could call it anemic. The only thing growing was populations which led to cycles of mass starvation. For thousands and thousands of years, humans slogged through life with very little success. Then, suddenly, in the early 1800's, civilization began flourishing in an ever-increasing, awe-inspiring string of successes. Around 1820, the world changed dramatically: the pace of technology accelerated, life spans doubled, education levels quadrupled, overall growth accelerated and the quality of life changed immensely.* So that begs the question, why? What happened in the early 1800's that made the paradigm shift?
Your answer to everything is oil. Oil did it, right? Wrong. The "Oil Age" didn't begin until the late 1800's, and didn't gain momentum until the 1900's. If you look at all the charts, modern civilization escaped the Malthusian trap in the early 1800's. World per capita GDP growth also broke out - massively - in the early 1800's. All of this happening far before the "Oil Age" from which you seem to pivot all of civilization.
While the Oil Age greased the wheels of prosperity, the wheels were already in motion before we stuck straws in the ground. So, what happened in the early 1800's that changed civilization?
According to William Bernstein* (sorry to quote a Jew), there's four major things that converged at about the same time: the securing of property rights; the scientific method; the ability to transport goods and people (steam engines); and - to my point - the development of capital markets. All of this coalesced in the early 1800's, before the Oil Age. Contrary to your point, oil was NOT part of the picture when civilization burst into the age of prosperity.
Now, back to the point at hand... the conversation was about usury and how loaning capital was instrumental to the growth and prosperity of civilization. Contrary to the simple-minded libertarians, I was making the point that banking was fundamental to the advancement of civilization, and I steadfastly maintain that. Capital markets are absolutely necessary to fund the research, development and large-scale manufacturing projects that helped pull humanity forward from the "breakout" of the early 1800's onward. Fuck, we wouldn't have had your precious oil without the capital markets that created the funds to get it. Furthermore, without mature capital markets, all the great innovators and thinkers from history didn't have the means to turn their dreams into reality. Sounds cheesy, but it's true.
All in all, banking and capital markets were fundamentally critical to the advancement of civilization before the "Oil Age" began. The real breakout of civilization was caused by the four aforementioned points. Oil - your ubiquitous answer to everything - was not the reason for the civilization's "breakout" in the early 1800's. As growth and prosperity continued throughout the 1900's, oil certainly has its rightful place in the conversation. But that's not what triggered the paradigm shift in the early 1800's - not at all.
Lastly, with regard to wages, I again must turn to banking. Without banking, capital stays in the hands of the aristocrats, and the aristocrats are free to pay us minimal bread crumbs. Banking - with all of its injustices - levels the playing field better than all the alternatives. It allows those without capital to take a shot at creating wealth, and it allows more opportunity for more prosperity for a larger percentage of the population. By doing so, it INCREASES wages. If there was no banking, and our only capital was the meager wages provided to us by our Kings and Queens, we'd barely get bread crumbs and shelter. However, banking and capital markets increase competition, diffuse capital more broadly, increase wages and lead to less oppression, when compared to a non-banking, aristocrat-ruled society.
* Go read, William Bernstein's The Birth of Plenty
You don't borrow capital dick head.
What happened at the start of the 1800s was the British Empire, which built trading posts all over the world built on debt. What you are seeing now, if you understood even a modicum of economics is the overhang of that system collapse now passed on to the rest of the worlds economies in all its glory. Enjoy the default idiot, because that's all that you get when you introduce credit into an economy. Now, back to school with you, sharpish...
banking didn't begin in the early 1800s.
Prior to oil came coal..same thing. Next time I'll say Hydrocarbon Age, which is a better, and more accurate shorthand.
The steam engine didn't run on banking or interest- it ran on HYDROCARBONS
Yes, I know banking didn't originate in the early 1800's - that's not what I was suggesting. I was suggesting two things.
First and foremost, banking was absolutely fundamental to the advancement of civilization. Take for example how the Medici banking family affected the Renaissance. Niall Ferguson, in The Ascent of Money, nearly credits the entire Renaissance on banking in general, and the Medici Bank in particular. In my prior post, I happened to focus on the massive paradigm shift that occurred in the early 1800's. That shift had nothing to do with hydrocarbons. The role of hydrocarbons took its role later and subsequently.
Second, as I just mentioned, I was suggesting that the modern capital markets were partly responsible for the life-changing paradigm shift that occurred in the early 1800's, when human civilization broke out of its historical doldrums and experienced prosperity like never before. I didn't give specific examples why only for the sake of brevity. But I did reference Bernstein's The Birth of Plenty which is several hundred pages of proof.
To your point about steam engines... they had been around for several hundred years before human civilization experienced its paradigm shift of the early 1800's, so its very difficult for me to accept that hydrocarbons in general can be credited with the awe-inspiring, historical leap of progress mankind experienced in the early 1800's. To quote Stephen Ambrose, by 1801, nothing on Earth moved faster than a horse. Hydrocarbons had been around forever, so what happened in the early 1800's that suddenly triggered the paradigm shift in human prosperity? Why where we suddenly able to harness the power of hydrocarbons to move goods and people from coast to coast in hours, rather than months?
Answer: modern capital markets and property (and intellectual) rights. People needed to be assured that they could prosper from their ideas - that their ideas wouldn't be stolen from them. And secondly, people needed the capital markets to turn dreams and ideas into reality - cheesy, but true.
Your hydrocarbons were nothing until mankind developed the capital markets and property rights to go after it and properly harness it. It's not even a chicken and egg argument. Now, obviously, the role of hydrocarbons is totally fundamental to our modern prosperity - but it was squarely subsequent.
Gotta a long Saturday in front of me.... gotta go.
Wow! Looks like our usual Redneck Repugnicant sockpuppeteer was pushed aside by senior troll persona #4 for these last couple of posts. Nice tag-teaming under a single handle --- but the substitution of the usual asshole who parades under your handle was rather obvious. Or are you simply back on your medication?
As for your laughable attempts to defend an increasingly criminal and parasitical bankster elite, while I would give you a "B+" for effort (compared to your usual flippant and hate-filled rants), I have to give you a "D-" for intellectual content. The sudden advancement of Western prosperity and technological progress in the 19th century was almost certainly due to a combination of factors, lead chiefly by a small thing you conveniently overlooked called the Industrial Revolution, aided by the end of the Napoleonic Wars, the rise of the United States, and the flowering of freedom and the diminishment of government interference in the economic sphere throughout that century. Oh, and not coincidentally, the universal dominance of hard money based on gold and silver. What do you know, the most rapid advancement in human history did NOT coincide with the use of fiat money, nor the dominance of central banks --- go figure!
The reason my posts have a different tone with Trav777 is because I have respect for his intelligence, despite the fact I don't like his racism and bigotry. I have no respect for you and your sphere of doomer goons like TMosley, which is why I typically resort to mockery and derision with you guys.
Second, for you to mention the Industrial Revolution in a manner that suggests I over-looked it or don't understand it is knee-buckling ridiculous. It proves YOUR stupidity, because my ENTIRE POST was about it. I was going a step further, and trying to explain WHY it happened when it did. WHY did the Industrial Revolution happen, when mankind had been basically dormant for all of history? That's what I was addressing, which totally flew over your head.
Returning to the original point, the development of modern capital markets (among other things) was absolutely fundamental to the paradigm shift of prosperity and growth which began in the early 1800's, i.e the Industrial Revolution. Of course, the libertarians think banking and interest is just pure evil which should be stopped, and that's ridiculous.
And that is just another of the innumerable strawmen with which you typically pepper your inane and insane posts. I have read NOBODY ever make such a claim, least of all any libertarians --- a label which you speciously dare to apply to yourself here, all evidence to the contrary.
It always amuses me to run across statists such as yourself who feel so violently threatened by those who advocate liberty and peaceful, voluntary social interaction. Now just why might that be?
PS: Can you please summarize your arguments again as to how we are currently supposedly suffering from "deflation", and just precisely how our costs of living are actually falling as our fiat currencies continue to appreciate in value, as you recently claimed in another recent thread? I am going to a party tonight, and need some good jokes.
The lack of it.
Inflation is CREATED. If it were not,, steady technological advance would engender, over time, a naturally deflationary environment. There would be no need for usury in that environment.
No, even in a sound money environment, it is reasonable to charge interest on loans. You're asking the lender to forego using his/her money for a period (possibly decades), as well as the risk of default.
No interest = no loans = difficult to raise money for large capital projects = poor levels of development = little or no civilisation.
Note that his question was towards usury. I tend to the classical definition of usury - excessive interest rates: http://en.wikipedia.org/wiki/Usury
Interest at a resonable rate is another matter entirely.
So I agree?
an interest rate greater than 0 on money you lent that you conjured from thin air is "excessive."
The ORIGINAL definition of usury was lending AT interest. In the Torah, there exist a couple commandments: one is to not lend to your "brother" (a triber) at interest. The other is a commandment to ALWAYS lend to a gentile at interest.
And, yes, this religious obligation is INTENDED because "god chose us to rule the planet." It doesn't matter if nobody still believes in God or has ever read this crap; it's part of the culture, the teachings, the society.
You're asking the lender to forego using his/her money for a period (possibly decades), as well as the risk of default.
I find it incomprehensible when the lender is a bank and they are loaning money that is created from the fractional reserve banking (basically created out of thin air) system then charging interest on that money that they don't have. Why aren't the banks paying for the free money they get to create? They can't even backstop their own bad loans so we have FDIC to protect depositors and bail them out. IMO there is no problem charging interest on money that you loan providing its not depositors money and its not fractionalized. I think this would put an end to bad loans and demand responsible loans. No leverage for the banks 1:1 ratio. Yes this would slow down the economy, but it would be a sustainable model. The other problem is the devaluing of our currency whereby it becomes almost neccessary to use credit. Its a system that feeds itself.
I probably should have explained that by 'sound money environment', I meant either no FRL, OR, banks issuing their own competing currencies - NOT our current system of banks issing the state-mandated legal tender via FRL.
It's a tricky word. For a long time it meant lending money for any kind of interest. Plato, and various Talmudic Judaic strictures against charging interest (though only to other Jews; it was ok to charge interest to goyim) kept the Christian West in knots over charging interest on lent money until well into the Renaissance. Now, of course, it just means 'unreasonably' high rates of interest... whatever that might mean.
Paying interest to a privileged cartel just to ensure the continued existance of our state-mandated currencies seems pretty usurious to me, though.
Which is why he was hired after co-authoring a revised edition of "Gibsons Paradox". Think of the havoc he has caused, yet to be recognized!
http://www.gata.org/files/gibson.pdf
Larry Summers...or Mr. Creosote ?
http://www.youtube.com/watch?v=BlK62rjQWLk
spot on.
Without an increase in aggregate energy inputs, how can consumption be expected to resume its increase? It cannot and will not.
The growth system has made the lizard usury palatable. It was acceptable to pay a fee to the chosen, eh what the hell, money was flowing like water. In times of crisis, this will reverse. Waste and parasitic drag like diversity and things like the ADA which mandate immense waste on the 1-in-10000 chance a person in a wheelchair actually needs to park their wheelchair van, become unacceptable in hard times just as wasting food or not eating the crusts is a whocares in prosperous times but verboten during famine.
This will provoke a low-level class war where the usurers, deprived of their steady income stream, begin to attack the pie itself to grab a larger fixed share. When incomes wane, you go after the producing assets.
Huh2...
http://theeconomiccollapseblog.com/archives/the-new-reality-for-u-s-citi...
But it is not just Detroit that is having a major problem. Over in Highland Park, Michigan the majority of the street lights have been repossessed because the city was not keeping up with the electricity bill.
Down in St. Louis, parents in some areas are carrying golf clubs with them as they walk their kids to school in order to fend off roving packs of wild dogs.
In an extraordinary article entitled "City of Ruins", Chris Hedges did an amazing job of documenting how bad things have gotten in Camden. Today it is estimated that the actual rate of unemployment in Camden is somewhere around 30 or 40 percent. For most young people in Camden, there are very few legitimate opportunities for a better life, so many of them have resorted to selling drugs or selling their bodies in a desperate attempt to survive.
The following is a brief excerpt from "City of Ruins"....
There are perhaps a hundred open-air drug markets, most run by gangs like the Bloods, the Latin Kings, Los Nietos and MS-13. Knots of young men in black leather jackets and baggy sweatshirts sell weed and crack to clients, many of whom drive in from the suburbs. The drug trade is one of the city's few thriving businesses. A weapon, police say, is never more than a few feet away, usually stashed behind a trash can, in the grass or on a porch.
All bullish.
Those fucking asswipes would have left those areas if welfare, food stamps, unemployment, and disability were stopped.
The market for labor could clear and these inefficient clusters of parasites (called ghettos) promoting more parasitism could clear up
no, they wouldn't have. They'd just squat on walls and streetcorners like they do whereever in the world they are.
dude, where ANYWHERE have blacks FAILED to destroy the civilizations they inhabited once they became beyond a sizable minority?
The crime, drugs, and degeneracy are ALWAYS there and eventually chase all the civilized people out.
The fuckers in Camden are not effing DESPERATE, they're just doing what they are gonna do ANYWAY. It is those types of BEHAVIORS that lead to the blight!
I mean, fuck, Iceland just went through an economic collapse and I didn't see that shit there.
Camden will become little Africa just like Detroit has
So this fuck just woke up?
I wouldn't call that waking up, myself.
Just soothing gibberish whispered in the ears of those still sleeping, those who don't want to wake up (you know, almost everyone) by an establishment frontman via a Reuters (MSM) blog.
Waking up entails thinking for oneself, at which point Summers' contradiction couched as an irony is all too apparent.
Just had to give you green for that.
Deep.
Summers has far from "woken up" ...in fact his discription just demonstrates (exposes) what fuking idiots populate the halls of Harvard passing themselves off as Professors
after periods of over-confidence, over-leverage and credit/debt expansion does not follow another phase of the same ...there follows pessmism, credit/debt implosion and 'Return to Base' (productive wealth)... contraction (winter)
Summers wants to live in permanent socialist sunshine LaLa Land no doubt ironing out the dips and depressions in good Statist Keynsian stylee.
Summers is delusional and more importantly exposes he knows fuk all about economics and the phases of capitalism (a fitting CV for Chief Economic Advisor to the disasterous village idiot, President Obumma)
I'm with B9K9 above, in that Summers knows exactly what he's saying, and why... and he's saying it because it really is all or nothing at this stage, and TPTB that he represents have an otherwise empty toolbox. Kicking the can for a few more minutes is better than not kicking it at all (for them, that is).
Summers doesn't want the illusions of the majority that they can "live in permanent socialist sunshine LaLa Land" shattered, and nor do his masters. He ain't stupid, just compromised.