Glad to see someone else see the fatal flaws in Keynesian economics. Sadly, that's the bullshit they team in classes today.

Any prediction of economic collapse is inevitable. Timing is what makes the difference. In this case, they have both been wrong plenty (whatever the reason).

If you lost a lot of money on his advice you may feel differently. Maybe then you could admit he was wrong.

Being "right" is meaningless. Hence, Agent 488's comment. You have to be right at the right time!

50 phd's in common sense

Well, he was definitely right about the housing and financial collapses which put him in the 1% of intelligent economists in the world. I've made more than I lost with his predictions as well. I really messed up with those triple leveraged etfs because I thought we were overdue for a correction but we all underestimated the government's involvement and influence on the stupid and naive American public.

Yeah, I don't take anything away from him. I never had heard of him until you brought him up. I think he makes a lot of sense in a lot areas.

That said, I'm still partial to the deflation first scenario right now, but that could change.

Right now, I'm focused on shorting equity futures. I have mid August for timing. I would like to see 10,950 DJIA and 1144/esu, but whether it pokes its' head up more remains to be seen.

Yea, shorting equities is the way to go. I've taken advantage of the low volume trading and get high dividend paying stocks for now, obviously short term. With that said, I'm not partial to the deflation theory. I don't even see how it's possible. We're in a period of disinflation and QE right now but Bernanke would have to be dumber than he already is to introduce negative interest rates while contracting the money supply. I'm on the inflation/hyperinflation bandwagon. Deflation would just be a step before those but I doubt it would happen.

Actually, cheap and easy credit are what make the credit card companies the massive profits they are currently making. It's also the reason we are in this mess in the first place.

If credit card companies weren't making a fucking fortune from giving credit to people whom can't afford it, you wouldn't see them signing up broke college students at college campuses or at Spring Break events giving away CC's like it's candy.

Do away with cheap easy to get credit and it will only help the middle class but it will cause big business to crumble because they are the ones whom are sucking the blood out of the middle class and benefiting from all this.

The simple fact is our current economy is driven by people living out side their means.. You can thank deregulation and the guys at the top for this.. It's not just the morons whom couldn't afford to pay their bills because someone gave them the credit cards/loans they couldn't afford in the first place.

Deregulation is also the reason we hit out economic peak in the 50s-80s. It's the fault of the consumers for living beyond their means. IF they weren't stupid, the credit card companies would cease to exist. Try blaming the actual culprit. Government expansion and intervention is also why the Great Depression was prolonged. Get your facts straight.

Yeah, but haven't we been in a dis-inflationary environment since Volker?

A serious credit contraction combined with debt defaults is deflationary. That is evident and likely to continue -- both in the US and EZ.

What the government is trying to do is inflate... ie; to get the credit wagon going again. Hence the fiscal and monetary stimulus. Hence the fear of inflation / hyper-inflation. It's just not working because the deflationary forces are that large. Banks are not lending money and consumers are not borrowing or spending like before.

Look at all the austerity measures being introduced around the world. This is what the tea party, conservative crowd is also screaming for. Guess what... deflationary.

I think it is easy to see the possibility of deflation first. Doesn't mean it will happen, though.

I'm pretty sure we've had disinflation on and off for the past 10 years.

It depends on what you view deflation as. I view it as negative interest rates and a contraction of the money supply. The concept of quantitative easing contradicts that concept of deflation.

Actually, I think the banks ARE lending money but the consumers are neither borrowing nor spending. And it's not working because of the massive dollar debasement that has been plaguing this country since Obama became President, mostly because of the abuse of the printing press.

I think the tea party is screaming for deregulation, not necessary deflationary measures.

I would say almost 30 years, hence the Volker comment.

I view deflation as simply the decrease in the price level of goods and services.

The banks asses are puckered up beyond belief. They are not lending -- especially compared the the recent past.

I don't know where you come up with the dollar debasement starting when Obama became president stuff. I think that is just your strong political ideology run amok. I used to think you were just trolling, but maybe you really believe it.

The fact is the dollar index was at 125 in June 2001. It collapsed to 74 by March of 2008 (it is now 81.39/dxu10). Gold was under $300 in 2000 and got as high as $1075 in 2008 (it is now 1199/gcz10).

The DJIA peaked in October 2007 at 14,198. By the end of 2008, it was already down 50%. The beginning of the bailouts were already started. The housing bubble had already burst.

I'm not looking for a scapegoat to explain the devaluation of the dollar or slide in equities or home prices or whatever that occurred during the last decade. I just want to be on the right side of the markets.

But, if I was wanting to place blame, why would I point the finger at Obama and not equally (or more so) at Bush given the above chronology?

Of course they are not screaming for deflationary measures. They are, however, inadvertently promoting certain actions that are deflationary in the short run. These are the austerity measures I cited as an example.

Every time I hear her I think I fall a little more in love with her. The conclusion she draws in this lecture is amazing in its simplicity and the profound implications it has for American society. Thanks very much for posting it

My mistake



There are 2 different ways to view it, that's one way. The problem with that way is that it is very black and white, and doesn't take the middle ground(disinflation) into consideration.


Read carefully what I wrote. I didn't ever state that it started with Obama, I said it became crazy with Obama.

You should be looking at it from the "real" perspective, not nominal.

The scapegoat is usually the FED, whoever lets the fed run things, and the printing press.

Because while Bush fucked up, Obama managed to create a new level of fail within 2 years.


I suppose that's one way to look at it then.

Following the inflationary (stagflation) of the 1970's, disinflation seems to have been in force during the great credit expansion of the last few decades. I would think it is taken into consideration. Deflation is the other extreme from hyper-inflation.

I did read it carefully and that's not what you said....

Quote:

Originally Posted by The Demon And it's not working because of the massive dollar debasement that has been plaguing this country since Obama became President, mostly because of the abuse of the printing press.

I can look at it either way and it does not follow that it started with Obama.

Agreed. They are all addicted.

Well, that may or may not be true. I'm not arguing that either way. I'm just pointing out that the claim of "massive dollar debasement that has been plaguing this country since Obama became President" does not follow.

yep. I believe curtailing spending at any level at this point is deflationary. Everyone is curtailing spending and deleveraging.

Again, I never said it started with Obama, the assertion is that it skyrocketed with Obama's presidency, which it has.

The Greek debt crisis quickly sobered people up on Keynesian economics. Many European countries are now on an austerity program.

I think it started with Nixon. Going off the gold standard and the exponential explosion of funny fiat money.

Yup, was just about to say that. It started with the 1971 agreement and kinda went from there. Then people started living outside their means and wallah.

The Greek debt crisis shows what happens when you do not have control of your currency. :2 cents:

I would have figured you would have taken it back to 1913. :winkwink:

interesting video, thanks for the post!

Yea, as a true gold bug I should have but things weren't in the shitter then. Post WWI gold standard also contributed to the Great Depression.

Interestingly enough, Professor Warren is in one of the top watchdogs of Washington banking policy. And Washington is resisting her: http://www.huffingtonpost.com/2010/0..._n_680123.html