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Old 02-11-2016, 02:26 PM
 
18,506 posts, read 15,494,002 times
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Quote:
Originally Posted by Hoonose View Post
Although we have control over the rates, IMO they are bound to go up. Especially if our economy takes off and we get more inflation. But I don't see it strapping us any more nominally than today.

http://www.treasurydirect.gov/govt/r...ir_expense.htm
This would require running a significant surplus to pay down the debt before rates go up much. If rates go up much without having paid down the debt first, the interest cost will skyrocket!
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Old 02-11-2016, 02:36 PM
 
18,792 posts, read 8,409,237 times
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Quote:
Originally Posted by ncole1 View Post
This would require running a significant surplus to pay down the debt before rates go up much. If rates go up much without having paid down the debt first, the interest cost will skyrocket!
In 10 and 100 years our National Debt will be higher, as will our GDP. Will interest rates ever again approach the 10% range? Possibly. But not all our debt will be at that rate. And we can issue only short term paper where we have more control.

From “ticking time bomb” to “looming collapse.” «#Monetary Sovereignty - Mitchell #Monetary Sovereignty – Mitchell
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Old 02-11-2016, 03:07 PM
 
3,792 posts, read 2,373,824 times
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Quote:
Originally Posted by ncole1 View Post
$30/hour will push the low-skill jobs overseas.
Unless we require them to pay our minimum wage as well.
Quote:
Originally Posted by ncole1 View Post

Raising tax rates modestly, while also increasing spending modestly, is one way to push up the AD line without going deeper into debt.
Note in a deflationary macro economic environment.


Here is an example. If you have a ratio of fixed expenses to income 3:2 that is 1/3rd of your income is not already spent (disposable) 2/3 is leveraged, taxed or already committed And you have a 10% reduction in pay then you get a 30% reduction in disposable income. But a 10% increase in wages gets you a 36.67% increase in disposable income.


A 10% reduction in wages by taxes gets you 30% less spending with a disposable to committed income ratio of 1:2.


with the same ratio a 10% increase in wages gets you a 36.67% increase in disposable income.


In a deflationary economy people tend to sit on cash. Increasing wages and prices will get them to spend money now.

with wages being 45% of GDP then a 10% increase in taxes on wages will get you a 4.5% of GDP increase in spending for the government. For a 30% decrease in disposable income for a highly leveraged person. 70% of our economy is consumer spending based so a 30% reduction of 70% gets you a 21% reduction in GDP.


Up the taxes and implode the economy. Up the interest rates and implode the economy. Up wages and the economy will recover.
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Old 02-11-2016, 03:48 PM
 
20,622 posts, read 19,277,825 times
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Quote:
Originally Posted by ContrarianEcon View Post
Spending on infrastructure is good. But spending at all is what is really needed and the government has done that in droves.

That isn't really Keynesian economics. That's lying polticians and pork barrel swindle. Its specifically to build tangible useful infrastructure with surplus labour while consuming the labour pool enough to give the labour market buying and bargaining power. That is what Keynes said. Now granted, this can certainly be an excellent cover for theft....

However its really kind of funny to lament da guberment interference in any kind of context to put money in the hands of the middle class after welfare for bankers. I'd would certainly have preferred to allow the banks to go bankrupt and be turned over to new management. i would have certainly not minded to see the housing market fall to wage support. However after da guberment breaks someone's legs, its not really a free market race to follow. And given that there was no Keynesian stimulus , does it even come to mind. There is nothing Keynesian about unemployment extensions, welfare, Tarp or QE.
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Old 02-11-2016, 04:17 PM
 
3,792 posts, read 2,373,824 times
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Quote:
Originally Posted by gwynedd1 View Post
That isn't really Keynesian economics.
It ain't what he preached but it does push the AD line up.
Quote:
Originally Posted by gwynedd1 View Post
That's lying polticians and pork barrel swindle. Its specifically to build tangible useful infrastructure with surplus labour while consuming the labour pool enough to give the labour market buying and bargaining power.
What can I say. No king beats crony capitalism any day. But a power vacuum invites a power hungry monster to step in.
Quote:
Originally Posted by gwynedd1 View Post
That is what Keynes said. Now granted, this can certainly be an excellent cover for theft....
Ya.
Quote:
Originally Posted by gwynedd1 View Post

However its really kind of funny to lament da guberment interference in any kind of context to put money in the hands of the middle class after welfare for bankers.
bottom up bailout. Good for everyone including the top.
Quote:
Originally Posted by gwynedd1 View Post
I'd would certainly have preferred to allow the banks to go bankrupt and be turned over to new management. i would have certainly not minded to see the housing market fall to wage support.
Well said. So if we wont let the housing market fall to wage support them move the wages to support the market.
Quote:
Originally Posted by gwynedd1 View Post
However after da guberment breaks someone's legs, its not really a free market race to follow. And given that there was no Keynesian stimulus , does it even come to mind. There is nothing Keynesian about unemployment extensions, welfare, Tarp or QE.
But it does push the AD line higher like K... should've.


All be it in a most undesirable way.
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Old 02-11-2016, 07:29 PM
 
Location: Silicon Valley
7,625 posts, read 4,543,947 times
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Quote:
Originally Posted by Hoonose View Post
Dollars can be created via the normal bank lending process, through Congress/Federal deficit spending, or via the Fed via QE out of thin air.

Compounding interest moves money around, does not produce it.
Thank you. I stand corrected. Yes, I'm ignoring the multiplier effect, which is where money comes from, which supplies the monetary amount to pay for the compound interest that increases the debt, but not the offsetting cash to pay said debt.

<sheepish> My only defense is I finally broke down and went to the doctor today midday. Fever of 102. Put an asterick by anything i wrote in the past 3 days.
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Old 02-11-2016, 07:40 PM
 
18,792 posts, read 8,409,237 times
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Quote:
Originally Posted by artillery77 View Post
Thank you. I stand corrected. Yes, I'm ignoring the multiplier effect, which is where money comes from, which supplies the monetary amount to pay for the compound interest that increases the debt, but not the offsetting cash to pay said debt.

<sheepish> My only defense is I finally broke down and went to the doctor today midday. Fever of 102. Put an asterick by anything i wrote in the past 3 days.
Take 2 aspirin and call me in the morning. (I am a doc)

(lol)
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Old 02-11-2016, 08:03 PM
 
Location: Silicon Valley
7,625 posts, read 4,543,947 times
Reputation: 12681
Quote:
Originally Posted by gwynedd1 View Post
What is classical Keynesian economics? Well, actually I can answer. what came close and that was Reagan that so called anti-Keynesian Conservatives cheer about when Reagan raised nominal GDP with huge deficits masquerading as defence spending. The only difference is there was little useful infrastructure built which is actually "Keynesian economics". The Hoover damn would be a the prime example. It created useful infrastructure and it added buying power to the private sector. I really don't think I have seen it since.
Wishing you would have added to this with a bit less cynicism. Canals, interstates, telephones, railroads etc were the past. People think of these as infrastructure, but speeding up the maintenance doesn't push costs down or increase possibilities like the first time they are constructed.

Today's infrastructure is mixed in with R&D. Satellites, robotics, internet, networks, sensors, solar panels...the problem is it lowers costs for everyone around the world, not just the US. But if the roads are rebuilt to allow driverless electric cars, that would be an infrastructure advantage unmatched in the world. Sometimes its a silver lining. While the US still loves its checks, Brazil's banks were the leaders in wired transactions to the masses due to their hyperinflation. That's a (albeit small) advantage of Brazilian entities vs the rest of the world.

Top Infrastructure Projects Now That Could Help the US.

10. Driverless roads with Electric Grid (Decreases input costs, reduces stand alone power transmission costs, 2nd chance to drive out one of larges import areas)
9. Economically viable solar power or fusion power (Decreases energy cost/gives negotiating edge against dirty power rivals, chance to eliminate imported raw materials)
8. Desalination Plants - (Run by said power in 9) (Increases arable land - Stops depletion of aquifers)
7. Development of Robotic/Programming Curricula and infrastructure in the school systems (Increases potential workforce)
6. Universal Health Care without the red tape (Keeps workforce healthy and not a cost to businesses)
5. Low cost Advanced Training (Increases Educated Workforce)
4. Low cost/tiny marks for tracing capital goods (Eliminates Capital Goods Crime)
3. Genetic biome of engineered plants (Surplus Food, Materials, Synthetic Materials)
2. All electric currency and VAT adoption- (Eliminates Tax Fraud/promotes transaction efficiency)
1. Expansive infrastructure for undersea or space development similar to promoting the railroads that went across the US before. (Gives growth avenues for all industries for products in new environments.)

Ok, shooting gallery begins.
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Old 02-12-2016, 03:38 AM
 
4,231 posts, read 3,540,570 times
Reputation: 2207
Quote:
Originally Posted by artillery77 View Post
Wishing you would have added to this with a bit less cynicism. Canals, interstates, telephones, railroads etc were the past. People think of these as infrastructure, but speeding up the maintenance doesn't push costs down or increase possibilities like the first time they are constructed.

Today's infrastructure is mixed in with R&D. Satellites, robotics, internet, networks, sensors, solar panels...the problem is it lowers costs for everyone around the world, not just the US. But if the roads are rebuilt to allow driverless electric cars, that would be an infrastructure advantage unmatched in the world. Sometimes its a silver lining. While the US still loves its checks, Brazil's banks were the leaders in wired transactions to the masses due to their hyperinflation. That's a (albeit small) advantage of Brazilian entities vs the rest of the world.

Top Infrastructure Projects Now That Could Help the US.

10. Driverless roads with Electric Grid (Decreases input costs, reduces stand alone power transmission costs, 2nd chance to drive out one of larges import areas)
9. Economically viable solar power or fusion power (Decreases energy cost/gives negotiating edge against dirty power rivals, chance to eliminate imported raw materials)
8. Desalination Plants - (Run by said power in 9) (Increases arable land - Stops depletion of aquifers)
7. Development of Robotic/Programming Curricula and infrastructure in the school systems (Increases potential workforce)
6. Universal Health Care without the red tape (Keeps workforce healthy and not a cost to businesses)
5. Low cost Advanced Training (Increases Educated Workforce)
4. Low cost/tiny marks for tracing capital goods (Eliminates Capital Goods Crime)
3. Genetic biome of engineered plants (Surplus Food, Materials, Synthetic Materials)
2. All electric currency and VAT adoption- (Eliminates Tax Fraud/promotes transaction efficiency)
1. Expansive infrastructure for undersea or space development similar to promoting the railroads that went across the US before. (Gives growth avenues for all industries for products in new environments.)

Ok, shooting gallery begins.
These are actually good but the problem is how do we pay??

Maybe private industry can be lead to this direction but i doubt that

Future of energy is nuclear btw stop with this solar, wind BS.
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Old 02-12-2016, 05:19 AM
 
18,506 posts, read 15,494,002 times
Reputation: 16183
Quote:
Originally Posted by Hoonose View Post
In 10 and 100 years our National Debt will be higher, as will our GDP. Will interest rates ever again approach the 10% range? Possibly. But not all our debt will be at that rate. And we can issue only short term paper where we have more control.

From “ticking time bomb” to “looming collapse.” «#Monetary Sovereignty - Mitchell #Monetary Sovereignty – Mitchell
70 percent of the debt is due within 5 years:

The real reasons why the US Treasury’s debt maturity has been rising | FT Alphaville
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