StreetScooby 5 #76 July 16, 2012 Quote My understanding is financial institutions hired out of work physicists (people particularly good with differential equations), to invent the derivatives that directly lead to the creation of CDOs. Derivatives are best viewed as insurance policies, no more, no less. These physicists use what is basically a heat transfer equation to price derivative contracts. One of the main problems with applying engineering equations to finance is the lack of conservation principles in financial markets. Engineers can absolutely, and always, rely on conservation of mass, energy and momentum. There are no effective conservation principles in finance and economics, that I'm aware of.We are all engines of karma Quote Share this post Link to post Share on other sites
ShcShc11 0 #77 July 16, 2012 Quote Quote Most of the "economic theories" put forth so proudly by various schools of thought are reduced parameter models, linearized about a point of interest. The nonlinearities that arise when perturbations exceed their defined range, or when parameters that were not part of the model prevail, routinely leave economists scratching their heads. To the unwashed masses, who have to take off their shoes and socks to count over ten, Economists appear to be real whiz kids. Your average Economist, however, would be lost trying to wade through the kind of advanced math that is fundamental to any kind of hard science/engineering curriculum. +1 IMO, most liberal mathematicians really don't seem to understand inverse responses, except when they're arguing for more Keynesian spending. StreetScooby, the only source you ever come up with is the WSJ whom have been wrong time and time again especially after 2008. WSJ can be fine if you used it in combination to let's say the Tax Policy Center, the CBO, etc... But nope, you just like to stick to WSJ. Quote You seem to be contradicting yourself here... Paying down debt is still spending money. Saving it is not paying down debt. This really is macro 101. They both relate to money hoarding. An enlarged Private Debt Sector caused by the 2008 housing bubble led to money hoarding. Think of it in terms of Interest Rates. If people are hoarding, then interest rates has to go down except it is at near-zero (aka the zero bounds economics... aka lack of demand). I absolutely love that you keep calling it Keynesian when Milton Friedman himself advocated for the same policies in a zero-bound economy. Even the father of supply-sides economics is contradicting you lol. Blueskies my friend :) Cheers! Shc Quote Share this post Link to post Share on other sites
rehmwa 2 #78 July 16, 2012 Quote>Why are cigarette taxes to fund day care so popular? Partly because people feel that this is a tax that accomplishes two goals - funding something worthy (i.e. daycare) and discouraging something undesirable for the population in general (i.e. smoking.) except it's idiotic - and appeals to two classes of social engineering afficianados (I apologize for my spelling) tax a product and it goes into the revenue pool if an expenditure is high enough on the importance pool to be covered under the existing account - then it's funded, if it's not, then it's deleted anything else forces overspending - the only way to really balance is to look at it at a macro way. this level of detail is just a structure for deceit to rationalize bad budgeting habits targeted tax vs spend is simply just a way to fake out more taxes in general. just saying that we are spending it for specific purposes is the sales job to the ignorant to rationalize stealth tax increases. In the end, they take more money from us all - and then spend it however they want ... Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants Quote Share this post Link to post Share on other sites
billvon 2,400 #79 July 16, 2012 >and appeals to two classes of social engineering afficianados (I apologize for my spelling) It has an additional problem. Tobacco taxes in some places have funded medical mitigation of tobacco health problems including lung cancer, emphysema, COPD etc. Non-smokers benefit from these programs as well since lung cancer (for example) is not limited to smokers. In at least one case I know of, these taxes have been so "effective" that medical center administrators have tried to figure out how to encourage smoking in the general population to continue funding of their supported programs. Quote Share this post Link to post Share on other sites
rehmwa 2 #80 July 16, 2012 Quote> medical center administrators have tried to figure out how to encourage smoking in the general population to continue funding of their supported programs. proving our point of course on a slightly more micro level than my post ... Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants Quote Share this post Link to post Share on other sites
StreetScooby 5 #81 July 16, 2012 Quote StreetScooby, the only source you ever come up with is the WSJ whom have been wrong time and time again especially after 2008. I admit that I read, and value, the WSJ daily, but I don't think it's fair to say that's my only source. Anyway, what has the WSJ been wrong on, and why? Just curious to further understand your perception. Quote money hoarding.... Are you referring to Say's law, or one of it's modern derivatives? http://en.wikipedia.org/wiki/Say%27s_lawWe are all engines of karma Quote Share this post Link to post Share on other sites
StreetScooby 5 #82 July 16, 2012 It's not so much the "rich" that are the engine of the economy as it is the entrepreneurs. Liberals seem to have a hard time understanding that, including our current president, IMO: http://www.dailymail.co.uk/news/article-2174160/Obama-says-wealthy-ARENT-responsible-success.html Quote America's leading small business association has slammed Barack Obama for showing 'an utter lack of understanding' of the country's entrepreneurs when he told them: 'If you've got a business - you didn't build that. Somebody else made that happen.' In a hard-hitting statement to Mail Online, the National Federation of Independent Businesses (NFIB) said: 'What a disappointment to hear President Obama's revealing comments challenging the significance of America's entrepreneurs. 'His unfortunate remarks over the weekend show an utter lack of understanding and appreciation for the people who take a huge personal risk and work endless hours to start a business and create jobs.' BTW, I deliberately used another source besides the WSJ just to demonstrate to ShcShc11 that I read more than that. In case you didn't know, the DailyMail is a liberal paper in England. To be honest, I usually just read them for their celebrity news and pictures We are all engines of karma Quote Share this post Link to post Share on other sites
kallend 1,623 #83 July 17, 2012 Quote It's not so much the "rich" that are the engine of the economy as it is the entrepreneurs. Liberals seem to have a hard time understanding that, including our current president, IMO: http://www.dailymail.co.uk/news/article-2174160/Obama-says-wealthy-ARENT-responsible-success.html Quote America's leading small business association has slammed Barack Obama for showing 'an utter lack of understanding' of the country's entrepreneurs when he told them: 'If you've got a business - you didn't build that. Somebody else made that happen.' In a hard-hitting statement to Mail Online, the National Federation of Independent Businesses (NFIB) said: 'What a disappointment to hear President Obama's revealing comments challenging the significance of America's entrepreneurs. 'His unfortunate remarks over the weekend show an utter lack of understanding and appreciation for the people who take a huge personal risk and work endless hours to start a business and create jobs.' BTW, I deliberately used another source besides the WSJ just to demonstrate to ShcShc11 that I read more than that. In case you didn't know, the DailyMail is a liberal paper in England. To be honest, I usually just read them for their celebrity news and pictures Daily Mail is not liberal by any means. It does have a serious interest in UFOs, however.... The only sure way to survive a canopy collision is not to have one. Quote Share this post Link to post Share on other sites
kallend 1,623 #84 July 17, 2012 Quote Get a clue, you worthless dumb fuck scholars. You can't spend unless you have a job. End rant..... indeed. You can inherit a fortune without having a job. You can be retired and have a fortune. No need to have a job if you're really wealthy. Of course, salting away your money in a Swiss, Bermuda or Cayman Islands bank (or all of the above) doesn't help the US economy or create US jobs.... The only sure way to survive a canopy collision is not to have one. Quote Share this post Link to post Share on other sites
ShcShc11 0 #85 July 18, 2012 Quote It's not so much the "rich" that are the engine of the economy as it is the entrepreneurs. Liberals seem to have a hard time understanding that, including our current president, IMO: http://www.dailymail.co.uk/news/article-2174160/Obama-says-wealthy-ARENT-responsible-success.html Quote America's leading small business association has slammed Barack Obama for showing 'an utter lack of understanding' of the country's entrepreneurs when he told them: 'If you've got a business - you didn't build that. Somebody else made that happen.' In a hard-hitting statement to Mail Online, the National Federation of Independent Businesses (NFIB) said: 'What a disappointment to hear President Obama's revealing comments challenging the significance of America's entrepreneurs. 'His unfortunate remarks over the weekend show an utter lack of understanding and appreciation for the people who take a huge personal risk and work endless hours to start a business and create jobs.' BTW, I deliberately used another source besides the WSJ just to demonstrate to ShcShc11 that I read more than that. In case you didn't know, the DailyMail is a liberal paper in England. To be honest, I usually just read them for their celebrity news and pictures First, we both know the quote given by Obama on business was out of context (there's another topic on dz on it). But honestly, this "he said/she said" is just politics as usual and doesn't really interest me. In fact, its funny that you keep making this as a "Liberals vs Conservative" when what I'm really looking for is: numbers and proof. All mainstream media from CNN, Fox, Spiegel, dailymail, BBC have a very difficult time making the numbers talk. Jack from CNN still talks about the "U.S deficit clock/fiscal cliff" and has very little understanding of how an economy works. WSJ is an OK source if you become impartial and pair it with FT, Alphaville, Brad DeLong, etc... WSJ in 2009 warned us that: "U.S 10 years bonds was about to explode" and 3 years later, U.S bonds are at an historic low. David Frum who is a right-winger said: "Imagine, if you will, someone who read only the Wall Street Journal editorial page between 2000 and 2011, and someone in the same period who read the NYT. Which reader would have been better informed about the realities of the current economic crisis? The answer, I think, should give us pause. Can it be that our enemies were right?" (meaning the WSJ has often been wrong including the 2000 bubble) Quote "It's not so much the "rich" that are the engine of the economy as it is the entrepreneurs. Liberals seem to have a hard time understanding that, " And you don't seem to understand that these entrepreneurs need to have demand in the economy. Without demand, then there's no reason to invest/expand/or become an entrepreneur in the first place. Many companies including Apple has been sitting on a mountain of cash yet they are not using it. You know why? Because of a lack of demand. If you listen to mainstream media, you'l hear some righty say: "its because entrepreneurs are afraid of Obama and his socialist policies" . Anyway, we'l keep talking about "our debts" while we continue to live (and complain) in a sub-par economic engine. ...caused none other than our passive pessimism on debt. Cheers! Weather is absolutely a delight today. Shc Quote Share this post Link to post Share on other sites
StreetScooby 5 #86 July 18, 2012 Quote Because of a lack of demand. I understand the issue surrounding lack of demand. I see that as a result of a society that has become too dependent on government spending, and/or government activity in the markets (e.g., CRA and subsequent issues as described in the Pinto dissent here: http://www.gpo.gov/fdsys/pkg/GPO-FCIC/pdf/GPO-FCIC.pdf). Also, Obama is saying increasing taxes on the rich, and corporations, will solve everything. He's numbers don't come close to adding up. Even if he takes all of their money, it won't cover his deficit, much less deal with our country's debt problem. It is simply insane. Enjoy the weather today!We are all engines of karma Quote Share this post Link to post Share on other sites
DanG 1 #87 July 18, 2012 QuoteAlso, Obama is saying increasing taxes on the rich, and corporations, will solve everything. He's never said it will solve everything. You're projecting. He's said it needs to be combined with spending cuts, such as the automatic cuts that will be triggered due to Congresses failure to cut the budget themselves. - Dan G Quote Share this post Link to post Share on other sites
Bolas 5 #88 July 18, 2012 When the economy was "good" people and the government were spending like drunken sailors on a weekend pass. Most was fueled by credit. The people ran out of money and the credit sources turned off and are recovering from their hangovers now and spending less and saving more. Government however is still spending away and expanding. This not only angers the people but scares them too, which in turn makes them save even more. Cut spending, cut regulations on business starting with any affirmative action type quotas and consumer confidence will slowly return. The key will be consistency and global regulations, not local ones. We should not suggest that the fix is drunken sailor spending. Stupidity if left untreated is self-correcting If ya can't be good, look good, if that fails, make 'em laugh. Quote Share this post Link to post Share on other sites
billvon 2,400 #89 July 18, 2012 >When the economy was "good" people and the government were spending like >drunken sailors on a weekend pass. Most was fueled by credit. Exactly. And that's the time to make spending cuts and increase taxes to repay the debt - when we can afford to do so. However the drunken sailor meme has been going on for decades, and it's pretty much a given that when the economy improves everyone goes to Washington with their hands out. Quote Share this post Link to post Share on other sites
jcd11235 0 #90 July 18, 2012 Quote>When the economy was "good" people and the government were spending like >drunken sailors on a weekend pass. Most was fueled by credit. Exactly. And that's the time to make spending cuts and increase taxes to repay the debt - when we can afford to do so. However the drunken sailor meme has been going on for decades, and it's pretty much a given that when the economy improves everyone goes to Washington with their hands out. Right now, the country has two economic problems. One is a slow economy caused by low demand. The other is a high deficit and increasing debt. Attempting to address the deficit before addressing the slow economy will only serve to slow the economy further. As you say, the best time to cut spending is when the economy is doing well.Math tutoring available. Only $6! per hour! First lesson: Factorials! Quote Share this post Link to post Share on other sites
kallend 1,623 #91 July 18, 2012 QuoteQuote>When the economy was "good" people and the government were spending like >drunken sailors on a weekend pass. Most was fueled by credit. Exactly. And that's the time to make spending cuts and increase taxes to repay the debt - when we can afford to do so. However the drunken sailor meme has been going on for decades, and it's pretty much a given that when the economy improves everyone goes to Washington with their hands out. Right now, the country has two economic problems. One is a slow economy caused by low demand. The other is a high deficit and increasing debt. Attempting to address the deficit before addressing the slow economy will only serve to slow the economy further. As you say, the best time to cut spending is when the economy is doing well. That idea went out the window when Reagan was elected and Voodoo replaced Keynes.... The only sure way to survive a canopy collision is not to have one. Quote Share this post Link to post Share on other sites
Bolas 5 #92 July 18, 2012 Quote Quote >When the economy was "good" people and the government were spending like >drunken sailors on a weekend pass. Most was fueled by credit. Exactly. And that's the time to make spending cuts and increase taxes to repay the debt - when we can afford to do so. However the drunken sailor meme has been going on for decades, and it's pretty much a given that when the economy improves everyone goes to Washington with their hands out. Right now, the country has two economic problems. One is a slow economy caused by low demand. The other is a high deficit and increasing debt. Attempting to address the deficit before addressing the slow economy will only serve to slow the economy further. As you say, the best time to cut spending is when the economy is doing well. But we didn't do that so we have to cut it now. It's not the best time but better late than never. Stupidity if left untreated is self-correcting If ya can't be good, look good, if that fails, make 'em laugh. Quote Share this post Link to post Share on other sites
jcd11235 0 #93 July 18, 2012 QuoteQuoteQuote>When the economy was "good" people and the government were spending like >drunken sailors on a weekend pass. Most was fueled by credit. Exactly. And that's the time to make spending cuts and increase taxes to repay the debt - when we can afford to do so. However the drunken sailor meme has been going on for decades, and it's pretty much a given that when the economy improves everyone goes to Washington with their hands out. Right now, the country has two economic problems. One is a slow economy caused by low demand. The other is a high deficit and increasing debt. Attempting to address the deficit before addressing the slow economy will only serve to slow the economy further. As you say, the best time to cut spending is when the economy is doing well. That idea went out the window when Reagan was elected and Voodoo replaced Keynes. How different might politics be today if the typical US voter (and politician) possessed basic mathematical literacy (i.e., basic understanding of algebra on the reals, trigonometry, and multivariate calculus)?Math tutoring available. Only $6! per hour! First lesson: Factorials! Quote Share this post Link to post Share on other sites
jcd11235 0 #94 July 18, 2012 QuoteBut we didn't do that so we have to cut it now. It's not the best time but better late than never. That's like saying that we didn't cut away this slow speed malfunction up high, so we should do it now, at 100 feet. Cutting spending now will only make things worse.Math tutoring available. Only $6! per hour! First lesson: Factorials! Quote Share this post Link to post Share on other sites
Bolas 5 #95 July 18, 2012 Quote Quote But we didn't do that so we have to cut it now. It's not the best time but better late than never. That's like saying that we didn't cut away this slow speed malfunction up high, so we should do it now, at 100 feet. Cutting spending now will only make things worse. This "malfunction" if landed as is is not survivable. Cutting spending is like firing the reserve at that altitude. It could save ya, but could also kill ya. Either way, ya at least tried something. Stupidity if left untreated is self-correcting If ya can't be good, look good, if that fails, make 'em laugh. Quote Share this post Link to post Share on other sites
Bolas 5 #96 July 18, 2012 Quote Quote Quote Quote >When the economy was "good" people and the government were spending like >drunken sailors on a weekend pass. Most was fueled by credit. Exactly. And that's the time to make spending cuts and increase taxes to repay the debt - when we can afford to do so. However the drunken sailor meme has been going on for decades, and it's pretty much a given that when the economy improves everyone goes to Washington with their hands out. Right now, the country has two economic problems. One is a slow economy caused by low demand. The other is a high deficit and increasing debt. Attempting to address the deficit before addressing the slow economy will only serve to slow the economy further. As you say, the best time to cut spending is when the economy is doing well. That idea went out the window when Reagan was elected and Voodoo replaced Keynes. How different might politics be today if the typical US voter (and politician) possessed basic mathematical literacy (i.e., basic understanding of algebra on the reals, trigonometry, and multivariate calculus)? This isn't all that complex. Cutting taxes some may lead to slightly more tax revenue, but a big tax cut combined with a HUGE increase in government spending is gonna cause the mess we're in now. The Repubs wanted a tax cut but the Dems would only agree if government spending was increased. The more one side demanded, the other side demanded the same. At the time it was viewed as a win by both parties. Stupidity if left untreated is self-correcting If ya can't be good, look good, if that fails, make 'em laugh. Quote Share this post Link to post Share on other sites
livendive 8 #97 July 18, 2012 Quote I didn't read the .pdf. it's from Berkley, I know where it's coming from. While the general leanings of the institution are certainly liberal, I'd guess that that qualifications of the authors to discuss the economy are substantially better than the average Speaker's Corner denizen, and the information conveyed in that report is likely much more reliable than anything you or I or anyone else here has to say. I laugh at the vocificerous statements shouted in this forum on the economy and the environment, as the loudest people are usually the least qualified to opine with any authority. Blues, Dave"I AM A PROFESSIONAL EXTREME ATHLETE!" (drink Mountain Dew) Quote Share this post Link to post Share on other sites
jcd11235 0 #98 July 18, 2012 QuoteCutting taxes some may lead to slightly more tax revenue … Uh, no. We're on the wrong side of the Laffer curve for that.Math tutoring available. Only $6! per hour! First lesson: Factorials! Quote Share this post Link to post Share on other sites
jcd11235 0 #99 July 18, 2012 Quote Quote Quote But we didn't do that so we have to cut it now. It's not the best time but better late than never. That's like saying that we didn't cut away this slow speed malfunction up high, so we should do it now, at 100 feet. Cutting spending now will only make things worse. This "malfunction" if landed as is is not survivable. Cutting spending is like firing the reserve at that altitude. It could save ya, but could also kill ya. Either way, ya at least tried something. It won't work. Cutting government spending to reduce a deficit means that there's no increase in private spending to offset the cuts. Economic growth is reduced, probably past zero. It's very important that, when government spending cuts are implemented, that private spending is at a level that can sustain economic growth.Math tutoring available. Only $6! per hour! First lesson: Factorials! Quote Share this post Link to post Share on other sites
Bolas 5 #100 July 18, 2012 Quote Quote Cutting taxes some may lead to slightly more tax revenue … Uh, no. We're on the wrong side of the Laffer curve for that. I meant to say slightly for both. Ran some numbers off of a base of 100, if taxes are extremely low to begin with it does take far more to break even or profit from a tax cut, but with a higher tax rate, a small decrease becomes more easy to compensate with additional growth. It's only possible with additional growth, which a tax cut can stimulate, but there's no way to show a direct correlation either way.Stupidity if left untreated is self-correcting If ya can't be good, look good, if that fails, make 'em laugh. Quote Share this post Link to post Share on other sites
