tag:blogger.com,1999:blog-2761684730989137546.post4009422177953514409..comments2024-03-28T07:50:06.102-04:00Comments on Mike Norman Economics: Over-analysis of a flawed concept. Is the occurrence rising exponentially in our populace?mike normanhttp://www.blogger.com/profile/03296006882513340747noreply@blogger.comBlogger15125tag:blogger.com,1999:blog-2761684730989137546.post-1624376255285366052012-05-25T17:40:34.986-04:002012-05-25T17:40:34.986-04:00If the level of inflation is low and stable, then ...If the level of inflation is low and stable, then interest rates are also low, and saving is a real bummer.Tom Hickeyhttps://www.blogger.com/profile/08454222098667643650noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-16651337464698789182012-05-25T16:11:38.704-04:002012-05-25T16:11:38.704-04:00Right, but I'm still left with the question of...Right, but I'm still left with the question of whether people should have a reasonable expectation of being able to save in the national currency without exposing themselves to market risk. <br /><br />By that I mean earn at least enough risk free interest to stay even with a continuous low level of inflation.<br /><br />I take it the MMT answer is "no".Kennoreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-71133582613877509532012-05-25T15:21:32.523-04:002012-05-25T15:21:32.523-04:00I used to trade for my own account. It started as ...I used to trade for my own account. It started as a sideline, so to speak, and then as many traders have found, it starts consuming a lot of time, both in keeping up with events, studying, and developing strategy. At that point, I had to ask whether this was the best use of my time and what I really wanted to do. I decided that the qualitative return was much greater elsewhere, even if the quantitative was not. Looking back, I am satisfied that I got my time and energy's worth, if not my money's worth.<br /><br /> To clarify that, I differentiate trading (speculating) from portfolio management ( financial investment). Trading is about increasing income; it's a job. Portfolio management is about preserving and increasing net worth. While they are essentially very different, they are often confused. Generally speaking, one should only trade a portion of one's net worth that one can afford to lose. That's a distinction that can become blurred. I was not always clear on it, especially when things were going well.<br /><br />Anyone can manage their own portfolio part-time, likely at least as well as most professionals, unless one is fortunate enough to find someone that is genuinely qualified and delivers on a regular basis instead of just collecting fees. <br /><br />But to be a successful trader requires a different level of commitment of time and energy. One has to decide if that commitment to success is worth what it takes. After a while, I reconsidered and switched focus.Tom Hickeyhttps://www.blogger.com/profile/08454222098667643650noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-66040572983968009642012-05-25T14:29:28.102-04:002012-05-25T14:29:28.102-04:00There's no such thing as an asset that is guar...There's no such thing as an asset that is guaranteed to appreciate. <br /><br />So what you're saying is there should also be no such thing as risk free, non-depreciating savings option, even for small savers.<br /><br />Not necessarily agreeing or disagreeing ... just want to make sure I understand. It could be a tough sell though, if we ever hope to socialize MMT ideas to a wider public.Kennoreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-43530071602274043132012-05-25T14:16:09.015-04:002012-05-25T14:16:09.015-04:00Ken said:
> What is better than saving in fiat...Ken said:<br /><br />> What is better than saving in fiat currency, and what is a "coordination-option"?<br /><br />Any appreciating asset? Friendship, trust & recognition for instance. Ever seen the Godfather movies? Read about the American Revolution?<br /><br />In this case, a coordination option is when a human brain puts 2+2 together, and turns isolated tactics into a strategy of compounding value.Roger Ericksonhttps://www.blogger.com/profile/17515506247888521516noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-73881721723034294532012-05-24T17:24:18.866-04:002012-05-24T17:24:18.866-04:00What is better than saving in fiat currency, and w...What is better than saving in fiat currency, and what is a "coordination-option"?Kennoreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-87907693527535173942012-05-22T21:28:37.842-04:002012-05-22T21:28:37.842-04:00@Ken,
> what option should be available for sm...@Ken,<br /><br />> what option should be available for small savers?<br /><br />The point is that it's pointless to save in a floating-value (i.e., depreciating) fiat currency as long as the issuing economy is growing. If the economy is growing, then there are always better options than saving fiat currency.<br /><br />Best approach for low-income citizens is to explore coordination-options, ala the typical college student. More time than currency, so invest the time with great care.Roger Ericksonhttps://www.blogger.com/profile/17515506247888521516noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-91416506738342735482012-05-22T17:08:20.323-04:002012-05-22T17:08:20.323-04:00OK, got it Roger. yes, its ridiculous to complain...OK, got it Roger. yes, its ridiculous to complain that poor people don't save enough when we have followed four decades of neoliberal policies aimed at driving their incomes down.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-21154275089884717782012-05-22T16:44:16.767-04:002012-05-22T16:44:16.767-04:00My question to all who advocate permanent zirp int...My question to all who advocate permanent zirp interest policy is what option should be available for small savers? <br /><br />Assuming that inflation is contained at two or three percent, that's still enough to eat into savings over time. <br /><br />Should ordinary people have an option to at least keep up with this, without having to take risks in stock markets?Kennoreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-82947634796276661902012-05-22T14:52:25.014-04:002012-05-22T14:52:25.014-04:00@DanKervick,
The details of how Japan's posta...@DanKervick,<br /> The details of how Japan's postal savings banks work there doesn't really matter. What does matter is Americans urging us to promote a specific use of a similar strategy here, targeted at helping more poor people "save" fiat currency.Roger Ericksonhttps://www.blogger.com/profile/17515506247888521516noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-59632562880358811182012-05-22T14:06:00.703-04:002012-05-22T14:06:00.703-04:00I lack some context here. Are postal savings bank...I lack some context here. Are postal savings banks really just institutions for the hoarding of currency - just big fiat currency vaults? My understanding was that in Japan the postal savings banks function more-or-less like commercial banks, lending funds for various projects as well as taking deposits.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-36426024521365472132012-05-22T12:55:40.987-04:002012-05-22T12:55:40.987-04:00And right here are the digits right on the spreads...And right here are the digits right on the spreadsheet:<br /><br />http://www.treasury.gov/resource-center/data-chart-center/tic/Documents/mfh.txt<br /><br /><br />Resp,Matt Frankohttps://www.blogger.com/profile/11978352335097260145noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-17503419798483779372012-05-22T12:18:24.762-04:002012-05-22T12:18:24.762-04:00What don't people like this get about saving b...What don't people like this get about saving being demand leakage, destruction really. That's Japan's problem. Too much saving and not enough spending. They've been fighting deflation for decades. Maybe Japan should try not making saving so convenient in order to increase spending.<br /><br />Japan is running an export economy, which means its workers are working for the ROW instead of fellow countrymen and they are shipping their real resources abroad so they can save more (increase digits on spreadsheets).Tom Hickeyhttps://www.blogger.com/profile/08454222098667643650noreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-29645065397913159972012-05-22T11:48:44.067-04:002012-05-22T11:48:44.067-04:00"It really does seem to be true that it's..."It really does seem to be true that it's easier to understand the constantly evolving operations & pace of real economies without any exposure to orthodox economics."<br /><br />And in light of a study I read about recently that 85% of economics PhD candidates felt they needed to know a lot of math, but only 13% felt they needed to know much about the economy itself, your Bozone Shield idea seems quite appropriate.John Zelnickernoreply@blogger.comtag:blogger.com,1999:blog-2761684730989137546.post-8655707397558193522012-05-22T10:58:37.944-04:002012-05-22T10:58:37.944-04:00Classic here Roger:
"People over 2000 years...Classic here Roger: <br /><br />"People over 2000 years ago could organize to do things we still can't imagine them being able to do, like Stone Henge & the Pyramids - not to mention complex tribal methods & strategies. <b>Yet our "sophisticated" electorate today can't do things we can already imagine, because we imagine we're not "saving" fiat currency, and are thereby running out of it? Preposterous!</b>"<br /><br />Resp,Matt Frankohttps://www.blogger.com/profile/11978352335097260145noreply@blogger.com