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(NPR)   New Jobs report: 96,000 jobs added and Unemployment down to 8.1%. November's Jobs report: Mitt Romney still unemployed   (npr.org) divider line 714
    More: Spiffy, Mitt Romney, Alan Krueger, a.m. ET, Bureau of Labor Statistics, unemployment  
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1194 clicks; posted to Politics » on 07 Sep 2012 at 11:10 AM (2 years ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2012-09-07 02:56:14 PM

WhyteRaven74: If the economy is so bad how come corporate profits are at an all time high?


Becasue they are holding on to revenue instead of SPENDING money on development and expansion. Was that a serious question?
 
2012-09-07 02:56:16 PM

BojanglesPaladin:

So we agree. They were wrong, and it didn't work.

Obama's plan were unsuccesful in turning the economy around.


Market above 13k, corporate profits at all time highs. Clearly the economy is in the shiatter
 
2012-09-07 02:56:31 PM

BojanglesPaladin: dericwater: Simple thing to do: vote out all the GOPs in congress who did everything they could to stymie Obama's plans.

Your vote is yours to do with as you see fit.

But as I pointed out above, Obama pretty much GOT what he asked for in the Stimulus Bill that was supposed to use Keynsian economics and hasten a recovery through the use of 800 BIllion tax dollars. He signed it about a month after he took office and while the democrats still had effective control of both houses. But even then, more Democrats voted against it than Republicans voted for it.

But regardless of the whys and wherefores, The Stimulus did not produce the desired or promised results, despite the cost.


So instead of a stimulus consisting of 33% tax cuts, what should've been done?
 
2012-09-07 02:56:31 PM

MattStafford: DamnYankees: MattStafford: If they paid you through debt, and you didn't do anything for them, it was bad.

This makes no sense at all. How is the fact that its debt relevant at all? If Google borrows the money from Jim Smith, how is that relevant? The existence of debt is merely a contractual relationship between the borrower and lender. It's completely irrelevant to whether or not the underlying transaction is a good idea.

Not via fractional reserve banking


Which has absolutely nothing to do with (i) the topic at hand or (ii) government borrowing.
 
2012-09-07 02:57:53 PM

BojanglesPaladin: But regardless of the whys and wherefores, The Stimulus did not produce the desired or promised results, despite the cost.


Because it turned out the economy was worse than we originally thought. When a band-aid fails to cure a gun shot wound, you don't conclude band-aids never work. Well you would.
 
2012-09-07 02:57:53 PM

MattStafford: Yeah, it utilized the fact that the rest of the industrialized world was in complete ruins,



And as such, weren't consumers. Economics is a two-way street. You know how we could recreate that? Economic isolationism. Pretend the rest of the world is completely destroyed.

I'm not advocating that, because it would be bad for the economy. I'm just pointing out your "if we go into debt, we can't grow our economy" is wrong - it's proven wrong. It's happened before.

Now you're just saying "well yeah the facts show I'm wrong, unless you ignore them!!! If you ignore them like I do, I can still be right!!!" No, you can't.
 
2012-09-07 02:58:58 PM

BojanglesPaladin: WhyteRaven74: If the economy is so bad how come corporate profits are at an all time high?

Becasue they are holding on to revenue instead of SPENDING money on development and expansion. Was that a serious question?


Folks, I think we have found the problem. Now if only we could get the right wingers to actually address it.
 
2012-09-07 02:59:31 PM

Mrtraveler01: So instead of a stimulus consisting of 33% tax cuts, what should've been done?


Who's talking about a 33% tax cut? Are you tying straw together for some reason?

CPennypacker: Market above 13k, corporate profits at all time highs. Clearly the economy is in the shiatter


Are you arguing that the economy HAS recovered?

I would be interested in the economic indicators you reference to arrive at that conclusion.
 
2012-09-07 02:59:40 PM

lennavan: BojanglesPaladin: But regardless of the whys and wherefores, The Stimulus did not produce the desired or promised results, despite the cost.

Because it turned out the economy was worse than we originally thought. When a band-aid fails to cure a gun shot wound, you don't conclude band-aids never work. Well you would.


Yeah, I don't know how you can prove that the stimulus did/didn't work if you can see what would've happened if we didn't pass the Stimulus.
 
2012-09-07 02:59:42 PM

BojanglesPaladin: WhyteRaven74: If the economy is so bad how come corporate profits are at an all time high?

Becasue they are holding on to revenue instead of SPENDING money on development and expansion. Was that a serious question?


It's refreshing to hear people admit that trickle-down economics doesn't work. Thank you.
 
2012-09-07 02:59:44 PM

BojanglesPaladin: Obama pretty much GOT what he asked for in the Stimulus Bill


That depends on how you define "pretty much". There were a lot of compromises that dampened the effectiveness of the stimulus. Collins killed the part of the plan that renovated schools all across the country. Snowe demanded an inclusion of an annual fix that exempts the middle class from the AMT -- costing $70B while providing no stimulus. Just a couple of examples.
 
2012-09-07 03:00:00 PM

DamnYankees: MattStafford: DamnYankees: MattStafford: If they paid you through debt, and you didn't do anything for them, it was bad.

This makes no sense at all. How is the fact that its debt relevant at all? If Google borrows the money from Jim Smith, how is that relevant? The existence of debt is merely a contractual relationship between the borrower and lender. It's completely irrelevant to whether or not the underlying transaction is a good idea.

Not via fractional reserve banking

Which has absolutely nothing to do with (i) the topic at hand or (ii) government borrowing.


He meant the gold standard.
 
2012-09-07 03:00:15 PM

skullkrusher: you're missing the fact that ROI works differently for the government than it does for private entities.

The government hires 10 people at $10k a year. First of all, they get a portion of that back in taxes - we'll call it 10%.
Those people then spend that remaining $9k each, netting the government $900 on the total transactions.
Those people spend the remaining $8,100 raising $810 in revenues for the government...
until eventually the government has recouped the entire expenditure while ALSO stimulating economic demand to encourage organic economics growth which leads to future revenues


Well, your first assumption is that it isn't immediately spent on a Japanese TV. Second, you need to come up with the interest from somewhere, which your example does not account for. Finally, you have created an economy that never invests in anything. It is just straight consumption, no investment.
 
2012-09-07 03:00:50 PM

Pincy: BojanglesPaladin: WhyteRaven74: If the economy is so bad how come corporate profits are at an all time high?

Becasue they are holding on to revenue instead of SPENDING money on development and expansion. Was that a serious question?

It's refreshing to hear people admit that trickle-down economics doesn't work. Thank you.


I know, wasn't it? Especially from a right winger.
 
2012-09-07 03:01:13 PM

DamnYankees: No, it's basic economics. It's sort of like how if you lose your job, you might borrow money from your parents in order to go back to school and get a better degree, to get a better job and then pay your parents back.

This, to you, is insanity?


I have said, numerous times, that I am fine with going into debt for education.

If you lost your job, and borrowed money from your parents to party like your college days, then that would be a problem.
 
2012-09-07 03:01:24 PM

BojanglesPaladin: Mrtraveler01: So instead of a stimulus consisting of 33% tax cuts, what should've been done?

Who's talking about a 33% tax cut? Are you tying straw together for some reason?


Should've worded it better but the 33% of the Stimulus consisted of tax cuts. So if you're saying that the Stimulus failed, then tax cuts failed?

graphics8.nytimes.com
 
2012-09-07 03:02:14 PM

skullkrusher: MattStafford: The only thing I'm against is going into debt and using it to pay for things with an ROI less than one.

that's the thing. Virtually nothing the government spends on domestically will generate an ROI of less than 1. Some things will lead to greater productivity boosts (roads and bridges) than others (ditches and crop circles) but in the end the ROI will always be at least in the vicinity of 1


I should add that this is assuming a closed economy. Negative net exports does bleed money out
 
2012-09-07 03:02:58 PM

MattStafford: If you lost your job, and borrowed money from your parents to party like your college days, then that would be a problem.


So you are under the impression that giving money to poor, unemployed people is the financial/moral equivalent to giving money to partying college kids?
 
2012-09-07 03:03:01 PM

sprawl15: skullkrusher: CPennypacker: Wait, who said we should dig ditches in the middle of nowhere? Keynes?

the guy who first said "The world will always need ditch diggers". He has noticed a dearth in the level of ditchdigging worldwide and would hate to be proven wrong after all these years.

Clearly you've never read this book:

[img443.imageshack.us image 329x500]


I read it when it was written by the original author
 
2012-09-07 03:03:47 PM

lennavan: Because it turned out the economy was worse than we originally thought. When a band-aid fails to cure a gun shot wound, you don't conclude band-aids never work


And yet, If a doctor applied a band-aid to a gunshot wound and sent you home with aspirin, that Doctor would be fired, right?

lennavan: Folks, I think we have found the problem. Now if only we could get the right wingers to actually address it.


Be careful what you wish for.

One of the most often cited reasons for companies holding on to their cash reserves is that it is a response to an uncertain economic enviornment , regulatory uncertainty, and an unknown tax landscape. Right winger might very well "address" that problem by voting in Romney, and putting businesses at ease that their money is safer without Obama and over-regulation wil lbe eased and they will start spending again.
 
2012-09-07 03:04:26 PM

MattStafford: skullkrusher: you're missing the fact that ROI works differently for the government than it does for private entities.

The government hires 10 people at $10k a year. First of all, they get a portion of that back in taxes - we'll call it 10%.
Those people then spend that remaining $9k each, netting the government $900 on the total transactions.
Those people spend the remaining $8,100 raising $810 in revenues for the government...
until eventually the government has recouped the entire expenditure while ALSO stimulating economic demand to encourage organic economics growth which leads to future revenues

Well, your first assumption is that it isn't immediately spent on a Japanese TV. Second, you need to come up with the interest from somewhere, which your example does not account for. Finally, you have created an economy that never invests in anything. It is just straight consumption, no investment.


Interest paid to foreign creditors and imports is an issue in this scenario. Domestic investment is not.
 
2012-09-07 03:05:09 PM

Mrtraveler01: Should've worded it better


No, you shouldn't have.

Bojangles is a disingenuous concern troll.
 
2012-09-07 03:05:43 PM

Mrtraveler01: So if you're saying that the Stimulus failed, then tax cuts failed?


No. I said no such thing.

(Although 'tax cuts' is a very vague descriptor. Do you know what those were?)

Mrtraveler01: Yeah, I don't know how you can prove that the stimulus did/didn't work if you can see what would've happened if we didn't pass the Stimulus.


Good point. Would you like to buy my Tiger Preventing Rock? It will keep you safe from tiger attacks.
 
2012-09-07 03:05:46 PM

BojanglesPaladin: Right winger might very well "address" that problem by voting in Romney, and putting businesses at ease that their money is safer without Obama and over-regulation wil lbe eased and they will start spending again.


i2.kym-cdn.com
 
2012-09-07 03:05:58 PM

BojanglesPaladin: And yet, If a doctor applied a band-aid to a gunshot wound and sent you home with aspirin, that Doctor would be fired, right?


Not if everyone else in the room was yelling "LET HIM DIE" while they physically prevented you from getting anything other than a bandage to treat the guy.
 
2012-09-07 03:06:08 PM

sprawl15: Mrtraveler01: Should've worded it better

No, you shouldn't have.

Bojangles is a disingenuous concern troll.


Plus I imagine he looks like fred flinstone

I have him farkied as Herpa Derpa Doo!
 
2012-09-07 03:06:40 PM

BojanglesPaladin: Are you arguing that the economy HAS recovered?

I would be interested in the economic indicators you reference to arrive at that conclusion.


S&P?
research.stlouisfed.org

How about GDP?
research.stlouisfed.org

Corporate profits?
research.stlouisfed.org
 
2012-09-07 03:09:07 PM

impaler: How about GDP?


That's one that has merit. Let's look at it from 2006-20012. From before the downturn.
 
2012-09-07 03:10:42 PM

BojanglesPaladin: The Stimulus did not produce the desired or promised results, despite the cost.


Is your contention that it produced no beneficial results or that it didn't live up to the advertisement? You only need to watch 1 action figure commercial from the 80s to know it isn't as cool in real life as advertised.
 
2012-09-07 03:10:51 PM
if thoses damn seniors would just give up Social Security and rejoin the labor force then unemployment could be 11%. dang nabut Fartbongo!
 
2012-09-07 03:11:13 PM
Alright, I need to leave this thread for a little bit, but I do want to leave everyone of the following.

Going into debt to pay people to dig ditches and fill them back up creates long term growth.

Just think about all the parts of that statement. What exactly going into debt means. What happens when you are forced to pay off debt. What benefits you get from people digging ditches. How their economic actions relate to the rest of the economy. Let it all sink in.
 
2012-09-07 03:11:45 PM

BojanglesPaladin: impaler: How about GDP?

That's one that has merit. Let's look at it from 2006-20012. From before the downturn.


NOTE: This is in "chained dollars" - i.e. adjusted for inflation.
research.stlouisfed.org
 
2012-09-07 03:13:19 PM

MattStafford: Alright, I need to leave this thread for a little bit, but I do want to leave everyone of the following.

*STRAWMAN*


Can you at least leave a match?
 
2012-09-07 03:13:30 PM

MattStafford: Just think about all the parts of that statement. What exactly going into debt means. What happens when you are forced to pay off debt. What benefits you get from people digging ditches. How their economic actions relate to the rest of the economy. Let it all sink in.


Please do the same, and stop thinking about the productivity of the ditch digging (which is irrelevant) and think about the economic effect of "poor people having more money", which is really what we're talking about.
 
2012-09-07 03:13:41 PM

MattStafford: Going into debt to pay people to dig ditches and fill them back up creates long term growth.


You've said repeatedly you support spending on building roads and bridges yet every time you talk about going into debt the money is going into digging ditches and not on building roads and bridges. You make no sense. Please don't come back.
 
2012-09-07 03:13:55 PM

MFL: This jobs report was predictably horrible. Now we get another round of QE which is going to do nothing more than artificially prop up the stock market, raise food prices, raise gas prices, and stall out the economy again in a few months as all the middle class discretionary income gets eaten up. (like it has done every year for the last 3 farking years!)

Despite the drama over the last few days, this president's economic record is pathetic. We are not recovering, we are treading water. Only cool-aid drinkers and fools believe the nonsense about 4.5 million jobs he was selling. Hell we lost 5 million, so in reality we're not even back to go yet, which is absolutely pathetic if we are actually in this supposed recovery.

Lets break it down.

The Reagan recovery.
[www.nationalreview.com image 630x378]

The Clinton recovery
[www.nationalreview.com image 630x378]

the Oba-meh recovery
[www.nationalreview.com image 630x378]

You can polish turds, slay strawmen, and turn a convention into a big emotional Oprah rally, it doesn't negate the fact that Mr. Obama has no idea how to fix the economy and is floundering because his hype is wearing out.


OR it could be you can't compare apples to oranges and the Obama recovery is happening while the rest of the world is seeing the worst global recession we have ever seen?
 
2012-09-07 03:14:16 PM

DamnYankees: Debeo Summa Credo: Rather, I'm simply stating that issuing additional treasury securities will draw capital away from somewhere else.

And I'm arguing that the fact that people are willing to buy securities from the government at a negative real interest rate is evidence that there simply are no other viable opportunities for investment "somewhere else" where this money is willing to go.

Debeo Summa Credo: In order to buy the incremental treasuries that you think we should issue, those investors will have to liquidate other investments.

What other investments, exactly, do you think people have that they are turning away from in order to invest in a bond which offers a negative interest rate? Your theoretical construct makes sense and is nice, but its at odds with a reality where people are willingly investing in bonds at a negative rate.


The reality is that for the government to issue more debt, buyers of that debt will have to provide funds to the government in exchange for the debt. You get that, right?

So where do you think potential investors are currently keeping the funds that you expect them to use to buy the newly issued treasuries? I don't know how to put this more simply. They're not sitting on a pile of $100 bills.

Any money that might be used for additional treasury purchases is currently in some sort of investment or interest bearing account. They will have to liquidate those investments or withdraw from those interest bearing accounts (for instance bank deposits which fund loans) to buy the new treasuries.
 
2012-09-07 03:14:50 PM

BojanglesPaladin: One of the most often cited reasons for companies holding on to their cash reserves is that it is a response to an uncertain economic enviornment , regulatory uncertainty, and an unknown tax landscape. Right winger might very well "address" that problem by voting in Romney, and putting businesses at ease that their money is safer without Obama and over-regulation wil lbe eased and they will start spending again.


Except it's BS. Businesses spend their reserves to meet growing demand. Government spending is a proven method for stimulating demand.
 
2012-09-07 03:16:24 PM

Debeo Summa Credo: Any money that might be used for additional treasury purchases is currently in some sort of investment or interest bearing account.


Please explain why, if this was true, anyone would actually buy t-bills.
 
2012-09-07 03:17:17 PM

Dusk-You-n-Me: MattStafford: Going into debt to pay people to dig ditches and fill them back up creates long term growth.

You've said repeatedly you support spending on building roads and bridges yet every time you talk about going into debt the money is going into digging ditches and not on building roads and bridges. You make no sense. Please don't come back.


it makes perfect sense if you read the start of the conversation
 
2012-09-07 03:19:22 PM

Debeo Summa Credo: DamnYankees: Debeo Summa Credo: Rather, I'm simply stating that issuing additional treasury securities will draw capital away from somewhere else.

And I'm arguing that the fact that people are willing to buy securities from the government at a negative real interest rate is evidence that there simply are no other viable opportunities for investment "somewhere else" where this money is willing to go.

Debeo Summa Credo: In order to buy the incremental treasuries that you think we should issue, those investors will have to liquidate other investments.

What other investments, exactly, do you think people have that they are turning away from in order to invest in a bond which offers a negative interest rate? Your theoretical construct makes sense and is nice, but its at odds with a reality where people are willingly investing in bonds at a negative rate.

The reality is that for the government to issue more debt, buyers of that debt will have to provide funds to the government in exchange for the debt. You get that, right?

So where do you think potential investors are currently keeping the funds that you expect them to use to buy the newly issued treasuries? I don't know how to put this more simply. They're not sitting on a pile of $100 bills.

Any money that might be used for additional treasury purchases is currently in some sort of investment or interest bearing account. They will have to liquidate those investments or withdraw from those interest bearing accounts (for instance bank deposits which fund loans) to buy the new treasuries.


You realize the Bid to Cover ratio for treasuries is usually around 3 right? They will sell.
 
2012-09-07 03:20:21 PM

DamnYankees: Debeo Summa Credo: Any money that might be used for additional treasury purchases is currently in some sort of investment or interest bearing account.

Please explain why, if this was true, anyone would actually buy t-bills.


...to pay for their T-Bird?
 
2012-09-07 03:21:26 PM

Mrtraveler01: Here you go!

impaler: NOTE: This is in "chained dollars" - i.e. adjusted for inflation.


Thank you. I think that GDP growth is one of many trusted indicators of economic growth and/or recovery, and this mnetric shows some mesurable improvement, which is good. But it is only one of many all of which must be balanced together.So GDP is up, whch is good. Unemployment is still high, which is bad. Debt and Defecit is up, which is bad. Do you have other positive metrics?

Mitt Romneys Tax Return: Government spending is a proven method for stimulating demand.


'Proven'?Could you articulate that proof?

It is 'proven' that Businesses hold on to cash reserves during periods of economic uncertainty.
 
2012-09-07 03:30:36 PM

CPennypacker: Debeo Summa Credo: DamnYankees: Debeo Summa Credo: Rather, I'm simply stating that issuing additional treasury securities will draw capital away from somewhere else.

And I'm arguing that the fact that people are willing to buy securities from the government at a negative real interest rate is evidence that there simply are no other viable opportunities for investment "somewhere else" where this money is willing to go.

Debeo Summa Credo: In order to buy the incremental treasuries that you think we should issue, those investors will have to liquidate other investments.

What other investments, exactly, do you think people have that they are turning away from in order to invest in a bond which offers a negative interest rate? Your theoretical construct makes sense and is nice, but its at odds with a reality where people are willingly investing in bonds at a negative rate.

The reality is that for the government to issue more debt, buyers of that debt will have to provide funds to the government in exchange for the debt. You get that, right?

So where do you think potential investors are currently keeping the funds that you expect them to use to buy the newly issued treasuries? I don't know how to put this more simply. They're not sitting on a pile of $100 bills.

Any money that might be used for additional treasury purchases is currently in some sort of investment or interest bearing account. They will have to liquidate those investments or withdraw from those interest bearing accounts (for instance bank deposits which fund loans) to buy the new treasuries.

You realize the Bid to Cover ratio for treasuries is usually around 3 right? They will sell.


I'm not arguing that they won't sell. DamnYankees is correct that there is plenty of demand. What I'm arguing is that the funds used to buy the treasuries will need to come from somewhere else. It's not just conjured from nowhere. And although the additional govt spending funded by the incremental treasury sales will benefit the economy, whatever project/spending the cash used to buy treasuries would have funded absent the additional issuance will have a negative effect on the economy.
 
2012-09-07 03:30:59 PM

BojanglesPaladin: dericwater: Simple thing to do: vote out all the GOPs in congress who did everything they could to stymie Obama's plans.

Your vote is yours to do with as you see fit.

But as I pointed out above, Obama pretty much GOT what he asked for in the Stimulus Bill that was supposed to use Keynsian economics and hasten a recovery through the use of 800 BIllion tax dollars. He signed it about a month after he took office and while the democrats still had effective control of both houses. But even then, more Democrats voted against it than Republicans voted for it.

But regardless of the whys and wherefores, The Stimulus did not produce the desired or promised results, despite the cost.


It was watered down. Most economists suggested twice the amount. Obama tried compromising with the GOP.
 
2012-09-07 03:32:26 PM

BojanglesPaladin: Thank you. I think that GDP growth is one of many trusted indicators of economic growth and/or recovery, and this mnetric shows some mesurable improvement, which is good. But it is only one of many all of which must be balanced together.So GDP is up, whch is good. Unemployment is still high, which is bad. Debt and Defecit is up, which is bad. Do you have other positive metrics?


GDP performance during the Obama Administration has gone into positive growth.
www.tradingeconomics.com

US stock markets performance during the Obama Administration...
DOW in 01/20/2009: 7,949.09
DOW in 09/06/2012: 13,292.00
Rate of Return: 67.21%

S&P 500 in 01/20/2009: 805.22
S&P 500 in 09/06/2012: 1,432.12
Rate of Return: 77.85%

NASDAQ in 01/20/2009: 1,440.86
NASDAQ in 09/06/2012: 3,135.81
Rate of Return: 117.63%


Private jobs hemorrhage slowed down during the Obama Administration and eventually went into positive territory.
farm9.staticflickr.com

Comparing unemployment rate fluctuation between President Bush and President Obama.

Bush
1/20/2001: 4.2%
1/20/2009: 7.7%
Unemployment Rate Change: 83.33% increase

Obama
1/20/2009: 7.7%
Currently: 8.1%
Unemployment Rate Change: 5.19% increase

Unemployment rate has been trending down now during the Obama Administration...
i2.cdn.turner.com

...Even though the Tea Party Nation urged small business owners to not hire people in order to make Obama look bad

Or when a company with company policies about not hiring until Obama is gone based on nothing to do with the basic supply and demand process for his business goods.

Or having Mitch McConnell admit that Republicans took America hostage

Or having the GOP blocked a 10 percent tax break for small businesses that hires new employees

Even so, the job market did improve. Read all about it...

Private-sector job growth biggest in 3 years (new window)

Stealth signs of a stronger job market (new window)

Biggest unemployment rate improvement in nearly 28 years (new window)

Small businesses ramp up jobs (new window)

Jobs: 2 hopeful signs (new window)

The unemployment rate fell to 8.3%. That is the lowest since February 2009 (new window)

Stealth jobs boom: 6 months, 2 million jobs (new window)

Jobless claims plunged last week to a nearly four-year low (new window)

If you are unemployed or underemployed, you don't have a 4 year degree (or higher) and blame Obama for your situation, then maybe you should get a college degree. It is not the Government's fault you don't have the necessary skills to compete in today's world. The Government can even help you pay for it (via student loans, grants, GI Bill etc.).
farm8.staticflickr.com

Average weekly paychecks have improved.
i2.cdn.turner.com

Inflation has not been out of control.
i2.cdn.turner.com

Manufacturing has started to go up.
i2.cdn.turner.com

Consumer spending is up.
i2.cdn.turner.com
 
2012-09-07 03:32:43 PM

Debeo Summa Credo: CPennypacker: Debeo Summa Credo: DamnYankees: Debeo Summa Credo: Rather, I'm simply stating that issuing additional treasury securities will draw capital away from somewhere else.

And I'm arguing that the fact that people are willing to buy securities from the government at a negative real interest rate is evidence that there simply are no other viable opportunities for investment "somewhere else" where this money is willing to go.

Debeo Summa Credo: In order to buy the incremental treasuries that you think we should issue, those investors will have to liquidate other investments.

What other investments, exactly, do you think people have that they are turning away from in order to invest in a bond which offers a negative interest rate? Your theoretical construct makes sense and is nice, but its at odds with a reality where people are willingly investing in bonds at a negative rate.

The reality is that for the government to issue more debt, buyers of that debt will have to provide funds to the government in exchange for the debt. You get that, right?

So where do you think potential investors are currently keeping the funds that you expect them to use to buy the newly issued treasuries? I don't know how to put this more simply. They're not sitting on a pile of $100 bills.

Any money that might be used for additional treasury purchases is currently in some sort of investment or interest bearing account. They will have to liquidate those investments or withdraw from those interest bearing accounts (for instance bank deposits which fund loans) to buy the new treasuries.

You realize the Bid to Cover ratio for treasuries is usually around 3 right? They will sell.

I'm not arguing that they won't sell. DamnYankees is correct that there is plenty of demand. What I'm arguing is that the funds used to buy the treasuries will need to come from somewhere else. It's not just conjured from nowhere. And although the additional govt spending funded by the incremental trea ...


Please. That's not the case and you know it.
 
2012-09-07 03:35:45 PM

dericwater: Obama tried compromising with the GOP.


I think a review of coverage at that time would be a good idea. Obama famously told Republicans arguing about the Stimulus package touhg luck, saying "I Won".

Here's a quick recap from Politico
 
2012-09-07 03:39:07 PM

CPennypacker:
Debeo Summa Credo: In order to buy the incremental treasuries that you think we should issue, those investors will have to liquidate other investments.

What other investments, exactly, do you think people have that they are turning away from in order to invest in a bond which offers a negative interest rate? Your theoretical construct makes sense and is nice, but its at odds with a reality where people are willingly investing in bonds at a negative rate.

The reality is that for the government to issue more debt, buyers of that debt will have to provide funds to the government in exchange for the debt. You get that, right?

So where do you think potential investors are currently keeping the funds that you expect them to use to buy the newly issued treasuries? I don't know how to put this more simply. They're not sitting on a pile of $100 bills.

Any money that might be used for additional treasury purchases is currently in some sort of investment or interest bearing account. They will have to liquidate those investments or withdraw from those interest bearing accounts (for instance bank deposits which fund loans) to buy the new treasuries.

You realize the Bid to Cover ratio for treasuries is usually around 3 right? They will sell.

I'm not arguing that they won't sell. DamnYankees is correct that there is plenty of demand. What I'm arguing is that the funds used to buy the treasuries will need to come from somewhere else. It's not just conjured from nowhere. And although the additional govt spending funded by the incremental treasury sales will benefit the economy, whatever project/spending the cash used to buy treasuries would have funded absent the additional issuance will have a negative effect on the economy...

Please. That's not the case and you know it


By all means then explain where the cash comes from to buy incremental treasury debt?
 
2012-09-07 03:42:04 PM

hugram: Wall of data.


Lots to look at, thank you. I will review, but I notice that you take some pains to include some 'bbbut Bush' analysis which I generally could care less about. I'm more concerned about comparing Obama to the norms and looking at trends within the time frames he was able to exert influence.

Bottom line, I do not generally give much consideration to the line of reasoning that says basically "Compared to the bottom, Obama's gone straight up!". I find that to be kind of damning with faint praise.
 
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