tag:blogger.com,1999:blog-2761684730989137546.post3172729055539581193..comments2024-03-28T07:50:06.102-04:00Comments on Mike Norman Economics: Which Part of "Dynamic Systems" Don’t These People Get?mike normanhttp://www.blogger.com/profile/03296006882513340747noreply@blogger.comBlogger85125tag:blogger.com,1999:blog-2761684730989137546.post-48539490313778921682012-07-28T14:51:12.880-04:002012-07-28T14:51:12.880-04:00Major I ddin't say there's anythingn wrong...Major I ddin't say there's anythingn wrong with it, you're a very cut couple. <br /><br /> If you compare my median comment to yours the only one compulsive is you. I'm able to make my point iwthout writing a dissertation. <br /><br /><br /> Even Bob Roddis is much less needlessly wordy than you. <br /><br /> What you don't get is that simplicity ispart of intelligence. That you can't make your point succinetly is part of your compulsively overleaded brain that can't think properly. <br /><br /> You fail even basic presentation which is why all your braying gets you nowhere. <br /><br /> On the other hand you are the biggest hypocrite in town. You all the time try to call people by saying their comment is falsified while you yourself try to pretend that your claims aren't also falsifiable.Mike Saxhttps://www.blogger.com/profile/01360689916550576484noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-82304167295373546132012-07-28T09:34:59.341-04:002012-07-28T09:34:59.341-04:00"I would agree that my goal of eliminating th..."I would agree that my goal of eliminating the initiation of violence against innocent people will probably fail"<br /><br />Ridiculous overblown sanctimonious disingenuous mindless rhetoric.ynoreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-66712555446800509682012-07-27T20:32:32.063-04:002012-07-27T20:32:32.063-04:00"Why not just rename the von Miser Inst as th...<i>"Why not just rename the von Miser Inst as the "Inst. for Paranoid Economics" ? ??"<br /><br />How about "the Inst. for Aztec Economics"?</i><br /><br />At some point, your inability to grasp even the simplest concepts overwhelms even me.Bob Roddishttps://www.blogger.com/profile/17263804608074597937noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-85064616489354249542012-07-27T19:03:54.051-04:002012-07-27T19:03:54.051-04:00I would agree that my goal of eliminating the init...<i>I would agree that my goal of eliminating the initiation of violence against innocent people will probably fail.</i><br /><br />Bob, I am willing to bet that everyone here has that goal. Most of us don't think that your solution is a viable one.Tom Hickeyhttps://www.blogger.com/profile/08454222098667643650noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-6287409279328734042012-07-27T17:54:09.949-04:002012-07-27T17:54:09.949-04:00"Why not just rename the von Miser Inst as th..."Why not just rename the von Miser Inst as the "Inst. for Paranoid Economics" ? ??"<br /><br />How about "the Inst. for Aztec Economics"?<br /><br />Sorry, this discussion is so wacky I couldn't resist!Letsgetitdonehttps://www.blogger.com/profile/07607539419260450949noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-81268023091634521532012-07-27T16:37:14.636-04:002012-07-27T16:37:14.636-04:00Bob, your world is an ideal world. It doesn't ...<i>Bob, your world is an ideal world. It doesn't exist on earth, and there is little reason to think that it will anytime soon.</i><br /><br />I would agree that my goal of eliminating the initiation of violence against innocent people will probably fail. But you guys shouldn’t be so outwardly joyous about the continuation of violence against the innocent. And I’m not at all sure what that has to do with the real world natural and universal limitation of human knowledge which is nothing but an unchanging given of the universe.Bob Roddishttps://www.blogger.com/profile/17263804608074597937noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-21774348610845849812012-07-27T16:04:13.917-04:002012-07-27T16:04:13.917-04:00"My world is real"
No, because the worl..."My world is real"<br /><br />No, because the world you describe has never existed.ynoreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-41774825567377320492012-07-27T14:30:25.052-04:002012-07-27T14:30:25.052-04:00Bob, your world is an ideal world. It doesn't ...Bob, your world is an ideal world. It doesn't exist on earth, and there is little reason to think that it will anytime soon.<br /><br />Meanwhile the world is moving on, SWAT teams and all.Tom Hickeyhttps://www.blogger.com/profile/08454222098667643650noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-17138364743165775412012-07-27T14:25:08.825-04:002012-07-27T14:25:08.825-04:00THERE IS NO SUCH THING AS FRACTIONAL RESERVE BANKI...<i>THERE IS NO SUCH THING AS FRACTIONAL RESERVE BANKING ANYMORE.</i><br /><br />Right. There is no fixed supply of real reserves and banks don't lend out nominal reserves or against nominal reserves.Tom Hickeyhttps://www.blogger.com/profile/08454222098667643650noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-2833702697866937222012-07-27T14:22:12.309-04:002012-07-27T14:22:12.309-04:00In your imaginary world economic calculation is al...<i>In your imaginary world economic calculation is always perfect.</i><br /><br />In the real world, nothing is perfect. In the real world, there is only one method to learn quasi-objectively about the subjective valuations of other humans beings and that is through the prices resulting from voluntary exchanges. State bureaucrats with their SWAT teams cannot gain such knowledge. Only in the imaginary worlds of "progressives" MMTers, Keynesians and other central planners can the planners obtain such knowledge.<br /><br />People act. People cannot read other people's minds. People have very limited knowledge of their circumstances. Central planners and their SWAT teams are people too. My world is real. Yours is a delusion.Bob Roddishttps://www.blogger.com/profile/17263804608074597937noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-24399726995539747402012-07-27T14:19:38.475-04:002012-07-27T14:19:38.475-04:00Major_Freedom said...
"Austrians want to adva...Major_Freedom said...<br />"Austrians want to advance to a more complex system of individual responsibility."<br /><br />Bob Roddis says:<br />(individuals will rise to accomplish all these infinitely scaling computations)<br /><br />Here's another place where you'd benefit from collaborating with people outside you're field. All living systems do NOT scale up by brilliance in individual computation. No matter the personal heroics, superheroes like predatory wasps are dwarfed by the accomplishments of social species. <br /><br />We're currently the pinnacle of social species evolution. Our peak return, by far, is always return-on-coordination. Ecologists call this "autocatalysis" - as does Gen. Systems Theory.<br /><br />Key point is that aggregates that can quickly converge to how few distributed calculations have to be processed in some unique context ... run circles around "single CPUs." <br /><br />The reason social species rule is the same reasons computing clusters outdo insane investments in individual computers. The agility of configurable clusters runs circles around the cost of continuously re-engineering individual CPUs.<br /><br />It's the same reasons humans are a network of several trillion cells, instead of one giant cell.<br /><br />It's boils down to the cost of scaling up individual CPU complexity, vs utilizing agile permutations of either cloned or diversified CPUs. Both approaches require incredibly dense engineering, but the cost of scaling the 2 approaches diverges radically, and the "social" approach won, hands down, millions of years ago.<br /><br />Your Austrian calculation theory simply does not scale. It's cost & latency of functioning are at least an order of magnitude larger (and diverging) than the cost of operating a networked system. The main savings is in forgoing things that don't have to be calculated at all, thereby transferring much redundant & hence useless CPU cycles away from individual processors.Roger Ericksonhttps://www.blogger.com/profile/17515506247888521516noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-14462601636528205512012-07-27T14:15:27.797-04:002012-07-27T14:15:27.797-04:00THERE IS NO SUCH THING AS FRACTIONAL RESERVE BANKI...<i>THERE IS NO SUCH THING AS FRACTIONAL RESERVE BANKING ANYMORE. Please repeat that 10x before every statement you make.</i><br /><br />We know that. We understand fiat funny money created out of nothing. We get it. But we were talking about the cause of bank runs under a sort of gold exchange standard or gold standard with fractional reserve lending and pointing out that the problems were caused by the fractional reserve lending which is not a valid criticism of gold, silver or Austrians. You're just trying to change the subject.<br /><br />MMTers and their Whac-a-Mole debating style.Bob Roddishttps://www.blogger.com/profile/17263804608074597937noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-49719090537487719902012-07-27T14:12:32.892-04:002012-07-27T14:12:32.892-04:00Bob,
In your imaginary world economic calculation...Bob,<br /><br />In your imaginary world economic calculation is always perfect. There is no government or paper money and everyone somehow agrees to use gold as money and never to increase the supply of credit. Prices are always predictable and they always move downwards at a steady rate. Despite this people keep increasing output and everyone gets richer over time. How wonderful.<br /><br />Problem is, that's not the real world. It has never been the real world. It will never be the real world. It can't be the real world. That's not how the real world functions. The real world has never functioned like that. It never will.<br /><br />Stop basing your criticisms on an alternative imaginary world and come back to reality.ynoreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-27261760749409360082012-07-27T14:04:36.740-04:002012-07-27T14:04:36.740-04:00Bob Roddis/Major_Freedom/Leverage said: "sugg...Bob Roddis/Major_Freedom/Leverage said: "suggesting that fractional reserve notes should have explicit warnings on the face of the notes of their extreme difference from warehouse receipts for specie"<br /><br />"Bank runs are always caused by fractional reserve banking"<br /><br />"In my "personal" battle against fractional reserve"<br /><br />Guys. Fractional reserve is a concept of the gold-std. On a fiat currency system there is no such thing as fractional reserve banking - unless you can think of a way to fractionate public initiative (i.e., fiat). Banks are not currently reserve-restrained, but are instead (in theory) responsible for their credit-rating reports, via completely separable examiner ratings of risk management, and judged behavior.<br /><br />That distinction raises added complexities that we need novel, indirect solutions for (Glass-Steagall, etc, etc, etc). There's no going back to less agile paradigms.<br /><br />THERE IS NO SUCH THING AS FRACTIONAL RESERVE BANKING ANYMORE. Please repeat that 10x before every statement you make.Roger Ericksonhttps://www.blogger.com/profile/17515506247888521516noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-25289843638002407932012-07-27T13:16:51.842-04:002012-07-27T13:16:51.842-04:00`And this [is] the heave-offering which ye TAKE fr...`And this [is] the heave-offering which ye <b>TAKE</b> from them; gold, and silver, and copper," Exodus 25:3<br /><br />Looks like the first thing you may want to do is to remove all of the gold, silver and copper from circulation within the population.... this looks like it is at least a good start.....<br /><br />rsp,Matt Frankohttps://www.blogger.com/profile/11978352335097260145noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-54757268951557158832012-07-27T12:45:01.608-04:002012-07-27T12:45:01.608-04:00"He forced people off gold. He didn't do ..."He forced people off gold. He didn't do it with everyone's consent. It was an act of aggression."<br /><br />I have to agree with the Major's description of FDRs policy here.<br /><br />Also I agree with FDRs decision and dont see anything wrong with it....<br /><br />rsp,Matt Frankohttps://www.blogger.com/profile/11978352335097260145noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-47043796597245006992012-07-27T12:42:10.723-04:002012-07-27T12:42:10.723-04:00That's nonsense, Bob. I have often said that H...That's nonsense, Bob. I have often said that Hayek's "The Use of Knowledge in Society" is a favorite of mine, and its is a good reason to end the political independence of the cb's. WArren Mosler has proposed that the natural rate of interest is zero. This would leave interest rate setting to the market. MMT agrees that monetary policy is more trouble than it is worth, since it involves picking winners and losers by rewarding savers or investors.<br /><br />Still, fiscal policy is necessary in modern nation states since govt run budgets. Modern nations aren't closed endogenous systems. Govts play a huge role, if only due to the % of GDP that goes to defense, and so does external trade.<br /><br />This implies the sectoral balances and therefore the sectoral balance approach to macro modeling as a rationale for fiscal policy. Functional finance is simply the statement that for maximum effectiveness and efficiency, govt needs to run a full employment budget by offsetting non-govt saving desire.<br /><br />How the people choose to allocate fund to public purpose in a liberal democracy is not an economic question but a political one. Economics can inform the the debate but not settle it, since different value systems are operative.<br /><br />The sectoral balance identity show that not doing this will result is either continuously rising price level, where broad money is growing faster than the capacity of the economy to expand, or else economic contraction, rising unplanned inventory, and increasing unemployment.Tom Hickeyhttps://www.blogger.com/profile/08454222098667643650noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-58769953800977375312012-07-27T11:59:12.428-04:002012-07-27T11:59:12.428-04:00Along with all of their other problems, the MMTers...Along with all of their other problems, the MMTers do not seem to grasp the Austrian concept of economic calculation or how economic calculation is seriously impaired by fiat funny money.<br /><br />John Carney of CNBC wrote:<br /><br /><i>I'm not trying to shoot down the core insights of MMT. In fact, I find them extremely valuable to my reporting and analysis.<br /><br />But there are some statements coming out of MMT that are highly misleading or confusing to people. Much of this confusion stems from the impression people get reading MMT blogs and papers that saving requires deficit spending. This is wrong, of course. But many smart, intelligent folks think this is what MMT is claiming.<br /><br />So they dismiss it as nonsense.<br /><br />What I've been trying to do is explore what it is that makes people think this is an MMT claim and what must be said to clarify it. <br /><br />Furthermore, I do think there's a problem with MMT that cannot be confined to confusion. <br /><br />The problem is as follows: MMTer are so focused on sectoral balances and the interaction between the private domestic sector and the public sector that they often downplay the intra-sector dynamics. <br /><br />Finally, <b>MMTers do not seem to fully appreciate the problems of ignorance and calculation that inform Austrian economics. They seem to recoil at even thinking about them because of the implications for the limits of political action</b>. This also needs to be corrected.</i><br /><br />http://tinyurl.com/7sycbeyBob Roddishttps://www.blogger.com/profile/17263804608074597937noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-75726023275518181432012-07-27T11:22:32.937-04:002012-07-27T11:22:32.937-04:00y:
over the 19th century the US money supply incr...<b>y</b>:<br /><br /><i>over the 19th century the US money supply increased dramatically, both because the supply of gold and silver increased, and because commercial banks operated on a fractional reserve basis and massively expanded the supply of paper money relative to gold and silver.</i><br /><br />And the credit expansion (along with two central bank experiments, and state intervention that cartelized the major banks) is why there were periodic bank runs and recessions.<br /><br /><i>It's nonsense to say that a "free market" in money inevitably leads to a fixed supply strictly tied to the quantity of gold.</i><br /><br />Right, but then who is claiming that?<br /><br /><i>Banks aren't bullion warehouses. They exist to lend money, and as they do so the quantity of credit or deposit money in the economy necessarily increases.</i><br /><br />The question is not about what they do, but whether they should do it. Nobody is disputing the mechanics of credit expansion.<br /><br /><i>People keep their money in banks because they want it to be lent out and invested, so that they can earn interest.</i><br /><br />People ALSO keep their money in banks because they want to keep it safe and available at all times, and they don't expect to earn interest.Major_Freedomnoreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-34951286588058567962012-07-27T11:17:47.482-04:002012-07-27T11:17:47.482-04:00money4nothing:
What's counterfeit and what...<b>money4nothing</b>:<br /><br /><i>What's counterfeit and what's not is definitely not decided by the cult you belong to.</i><br /><br />Right. It's decided by the cult you belong to.<br /><br /><i>Most of the cult members don't understand money, how It is created, and how It works.</i><br /><br />Right, because you cult members abandon economic science when you prattle on about the accounting tautologies of state monopoly in money.<br /><br /><i>It wasn't too long ago when Bob Murphy was talking about money multiplier and how Fed reserve pumping is going to create so much more money in the future because banks are going to lend It out.</i><br /><br />Did he give a timeline?<br /><br /><i>You would have guessed Rothbard understood banking since he waged a war against fractional reserve banking but not so:</i><br /><br /><i>"Banks keep checking deposits at the Fed and these deposits constitute their reserves, on which they can and do pyramid ten times the amount in checkbook money."</i><br /><br />This is true. If bank reserves decreased by say half, then they could not loan as much as they could before.<br /><br />Any time money4nothing talks about economy, he should state: I am MMT, I know nothing about economics, I am talking about accounting tautologies and making false inferences about them.<br /><br />July 26, 2012 2:52 PMMajor_Freedomnoreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-41870396763211720182012-07-27T11:13:48.145-04:002012-07-27T11:13:48.145-04:00Tom Hickey:
"This was FDR. The same FDR who ...Tom Hickey:<br /><br /><i>"This was FDR. The same FDR who signed into law Glass Steagall that brought FDIC into existence."</i><br /><br /><i>And why did FDR do this?</i><br /><br /><i>Bank runs</i><br /><br />And why were there bank runs?<br /><br />Fractional reserve banking the mechanics of which most people did not understand and were mislead into believing was safer than it really was.Major_Freedomnoreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-57902293141016602432012-07-27T11:11:42.666-04:002012-07-27T11:11:42.666-04:00Tom Hickey:
Again the saving issue. FDR took the ...<b>Tom Hickey</b>:<br /><br /><i>Again the saving issue. FDR took the US off gold because of hoarding.</i><br /><br />No, FDR <i>stole</i> the people's gold via Executive Order 6102, because he couldn't otherwise enact his fascist economic policies that were modeled after his role model Mussolini.<br /><br />He forced people off gold. He didn't do it with everyone's consent. It was an act of aggression.<br /><br />Gold wasn't abandoned because of hoarding. It was forcefully abolished by elite power grabbers who wanted to spend more money on themselves and their friends than they could collect via taxing and borrowing only.<br /><br /><i>The countries that abandoned the gold standard earliest during the Great Depression did best in raising GDP.</i><br /><br />Not all GDP raises standard of living (especially if GDP is composed of government spending dollar for dollar), and the fact that countries which reneged on their promises to foreign lenders first, ended up recovering first, doesn't prove the benefits of fiat over gold. <br /><br />If I had an outstanding mortage, I too could "recover" if I reneged on my promise to pay in dollars, and paid back in blank pieces of paper with my picture on them.Major_Freedomnoreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-91386458983906466722012-07-27T11:05:45.885-04:002012-07-27T11:05:45.885-04:00Roger Erikson:
Austrians say to go back to a simp...<b>Roger Erikson</b>:<br /><br /><i>Austrians say to go back to a simpler system where you could rely on your own, personal experiences, accept the bounds, and stay as is.</i><br /><br />No, it's the exact opposite. Austrians want to advance to a more complex system of individual responsibility. Tribal societies of masters and subjects is what is old and simpler. In societies with individual responsibility, complexity skyrockets. It's precisely why innovation and technological advances that increase our standard of living are highest in countries with some functioning protection of individual private property rights, and individual contracting.<br /><br /><b>Mike Sax</b>:<br /><br /><i>Bob Roddis really has it in for you guys-he just tried to get his boyfriend, Major freedom to start babbling all night like the class A obssessive-compulsive that he is.</i><br /><br />So Mike has showed his true colors once again. A hypocrite (because he babbles all night like a class A obsessive-compulsive and yet he accuses others of doing so) AND a homophobic bigot (because he insinuates there is something wrong with it by treating it like the scarlett letter).Major_Freedomnoreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-75105627305760733792012-07-27T11:05:33.168-04:002012-07-27T11:05:33.168-04:00Dan Kervick:
Bob, suppose you and Major Freedom c...<b>Dan Kervick</b>:<br /><br /><i>Bob, suppose you and Major Freedom create some money instead - Austrian Bucks, carrying the image of Ludwig von Mises - and pass them out to your favorites. Assuming you can get the money accepted and people start using it, are Austrian Bucks "counterfeit" money? And if not, then what is wrong with the national government I support issuing its own form of money?</i><br /><br /><i>And if all of these forms of money are counterfeit, then where is the real money in this world? And what makes it real?</i><br /><br />Dan, you have to distinguish between HOW one can "get the money accepted." If I pointed a gun at you and said you must pay me a tax in MY issued currency, even if you don't ever accept it on your own volition because then I will just demand that you pay me the Major_Freedom Dollar "equivalent", then if I started printing off Major_Freedom Dollars for myself and my friends, then we would be exploiting everyone who we are threatened by force to accept.<br /><br />There is nothing wrong with people printing off their own money, provided that others are not forced to accept them via taxation and legal tender laws.<br /><br /><b>Mike Norman</b>:<br /><br /><i>So they audit the Fed. Big deal. What are they going to find? An accounting ledger? Debits, credits in our national unit of account?</i><br /><br /><i>You are so ridiculous.</i><br /><br />Keep sleeping, sheep, because if you were paying attention, you would known that 2003-2008, it was discovered via the watered down audit the Fed bill that the NY Fed secretly (at the time) sent $40 billion to Iraq to finance the war. <br /><br />A true Fed audit would probably expose things that would make even MMTers blush. If it's all just accounting ledger, and debits and credits, then you should not be at all concerned with an audit.<br /><br /><i>And purchasing power has NOT gone down. The labor required to buy a house, a car, a basket of groceries, etc, is less now than it was 40 years ago. Not to mention that the quality, selection and availability of those items has gone up exponentially since then. That's not lower purchasing power.</i><br /><br />Purchasing power HAS gone down, if you ever understood the standard from which this statement is made. The standard is not the past. The standard is what otherwise would have existed had inflation not taken place and money was produced in the free market, just like potatoes, computers, and shirts. This standard is grounded not in observation, but in economic first principles, a field of inquiry which is over your head.<br /><br />If I robbed from you, and yet your nominal income increased over time because I am robbing you at a pace that is less than the rate of your nominal income growth, then by your worldview, my robbing you has not made your standard of living go down, because your income is technically going up over time. Yet it would be asinine to believe that your purchasing power has not been negatively affected by my theft, because even MMTers can understand that you <i>would have otherwise have had higher purchasing power</i>. The world in which I didn't rob from you is unobservable, but we can still know that I reduced your purchasing power despite your purchasing going up <i>over time</i><br /><br />Nobody is saying that inflation has to result in absolutely declining purchasing power over time. If inflation did that, the people would rise up and revolt. But if the inflationists can print <i>juuuuuust</i> enough to result in positive real growth over time, then dimwitted yahoos who can't reason their way out of a paper bag might believe that the inflation is causing the positive real growth, as if without monopoly inflation, real growth would have been lower.Major_Freedomnoreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-45132511550978409162012-07-27T10:45:22.400-04:002012-07-27T10:45:22.400-04:00Bob Roddis: Bank runs are always caused by fractio...Bob Roddis: Bank runs are always caused by fractional reserve banking, time deposits masquerading as demand deposits."<br /><br />And your solution is go to bullion.<br /><br />Again the saving issue. FDR took the US off gold because of hoarding.<br /><br />The countries that abandoned the gold standard earliest during the Great Depression did best in raising GDP. <br /><br />But we have been through this at least once before. Probably several times now.Tom Hickeyhttps://www.blogger.com/profile/08454222098667643650noreply@blogger.com