A plan so cunning you could brush your teeth with it :)

ZTD

boredofbeingathome wrote: »

I also find i am forgetting things, so that is a sign that my brain is whirring around too much:o Or old age:eek::rotfl:

I've always forgotton things, so I can't blame old age.

boredofbeingathome wrote: »

I am sleeping well'ish' for me anyways..

Perhaps you're finally going deaf...

boredofbeingathome wrote: »

I just can't seem to escape the feeling that i 'should' be doing something. Knowing my luck it will be something i have forgotten.

Depends on what that something is - "streaking" may be best forgotton....

boredofbeingathome wrote: »

I also have to think what i am going to do with money spare from my own personal debt once paid off.

Strippers...

ZTD

savingwannabe wrote: »

I love keynes.:(:(:(:(:(

Look at little deeper at what he was saying.

Your task is to explain "Stagflation" using Keynesian ideology. Be sure to explain how something can be too hot and too cold simultaneously...

savingwannabe wrote: »

Are you a fascist undertaker?

Fascists love Keynes too, because he claims you can fund eternal war.

savingwannabe

With regard to my mate Mr Keynes, what's the alternative to aggregate demand boosting spending? Not all spending is on war (ok stupid point i know a tremendous amount is). This is the argument against the Philips curve right?

Well here is my illogical answer (allowed as i am having a stonking hypo and can't sleep) Keynes is all fluffy and nice. I love him. I dont like Milton Freedman it comes down to the fact that sometimes you have to think with your heart and not with your head. Bobster that is why Porge is my hero his job is to make me logical. I was never a logical economist, i teach right wing kiddos and it is distressing sometimes you want to hear their parents. I would rather spend our way out of recession than punish the rich. We might look at the argument between Monetarists and Keynesians i see a horrible short term gap between the rich and the rest of society and i know which solution i prefer.

It is black outside and cold too. Easter eggs next week.:o

Oooh i feel like i have had a shouty. Dont like shouties but Milton Friedman was not a nice man.

savingwannabe

What do you think will stop the UK/world recession? Sorry to hijack thread.

Just had lots of grapes, lucozade and Ginger nut biscuits. Why are there no naughty biccies in house when i can eat them?

ZTD

Mucho apologies to Bob for the length of this.

savingwannabe wrote: »

With regard to my mate Mr Keynes, what's the alternative to aggregate demand boosting spending?

Let people spend what they want on what they want without ripping them off so they spend how you want them to spend. You know, in that "personal freedom" kind of way as opposed to the "you will do what I want" kind of way.

Messing about with interest rates does mess with people's time horizon, but to what benefit? Look at the last time people's time horizons were messed about with; the change in VAT. December - bonanza time! Everyone buying. January - tumbleweed time.

People who would have bought in January, bought in December instead. When January came along, everyone had bought in December. At that point the shops were complaining about "cashflow" which is pretty important for them.

That's the thing about debt - it moves purchases from the future into the present, it does not copy them.

If you would save up to buy a car in 2 years time, then you can buy the car now on credit. But in two years time, you're not going to buy another car. You already have a car.

So when you get to the future where you would have purchased whatever item it was, you can see the hole where your planned purchase used to be. So what happens at that point? Simple, the Government drops interest rates even further and moves more things from the future into the present. And then we get to that future, and find a similar hole. So the Government drops them again and so on.

Interest rates have a problem. They have a lower bound of zero. But that's only nominal interest rates. Real interest rates are "nominal interest rate" minus "inflation rate". So the Government cranks up inflation by printing money in order to drop real interest rates to get people to spend money they would have spent anyway if the Government hadn't previously gamed the system for short-term popularity benefit.

Except it isn't called "printing money" any more, it "quantitative easing".

Theoretically, there is an unlimited amount of future you can bring forward, and an unlimited amount of debt you can accrue, so long as the payments are "manageable". In practical terms there is a limit as to how much future can be brought forwards. It does seem to correlate nicely with a Kondratieff cycle, but that may be coincidence.

I have no theory as to why that is - it's just a practical, real-world limit.

We are now reaching the limits of the "aggregate demand boosting" of last century. How far we can stretch those limits remains to be seen, but the future is upon us, and it's not what we had planned.

savingwannabe wrote: »

Not all spending is on war (ok stupid point i know a tremendous amount is). This is the argument against the Philips curve right?

The argument against the Philips curve was the 70's. The 70's happened, the Philips curve was proven to be wrong. It was always wrong, the 30's proved it to be wrong, just Keynes came out with the "liquidity trap" guff to disguise it. The 70's proved it to be wrong again, but without any guff to hide it.

savingwannabe wrote: »

Well here is my illogical answer (allowed as i am having a stonking hypo and can't sleep) Keynes is all fluffy and nice. I love him. I dont like Milton Freedman it comes down to the fact that sometimes you have to think with your heart and not with your head.

"Sometimes". Keynes has been dead since the 40's. That's 70 years of not thinking with heads. Next time you go on holiday, look at the wings of the plane. Would you rather the people who designed them, and the people who stuck them on were thinking with their hearts, or their heads?

savingwannabe wrote: »

Bobster that is why Porge is my hero his job is to make me logical. I was never a logical economist, i teach right wing kiddos and it is distressing sometimes you want to hear their parents. I would rather spend our way out of recession than punish the rich.

If wishes were horses, beggars would ride. Neither would work.

savingwannabe wrote: »

We might look at the argument between Monetarists and Keynesians i see a horrible short term gap between the rich and the rest of society and i know which solution i prefer.

Curtail the power of the politicians so they can no longer inflate, and that gap will decrease.

savingwannabe wrote: »

It is black outside and cold too. Easter eggs next week.:o

Oooh i feel like i have had a shouty. Dont like shouties but Milton Friedman was not a nice man.

Doesn't matter if whoever was a nice man or not. It only depends if they were right. Those wings don't stay on through nicety. Milton Friedman was often wrong, but he was better than Keynes. I'll leave you with a couple of quotes where they were both right:

Lenin is said to have declared that the best way to destroy the capitalist system was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth. Those to whom the system brings windfalls, beyond their deserts and even beyond their expectations or desires, become 'profiteers,' who are the object of the hatred of the bourgeoisie, whom the inflationism has impoverished, not less than of the proletariat. As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery.
Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose. - Keynes

Inflation is always and everywhere a monetary phenomenon - Friedman

ZTD

savingwannabe wrote: »

What do you think will stop the UK/world recession?

A UK/world recession. It is its own cure.

Absolutely fill your lungs and hold your breath. After a while you'll feel an intense desire to exhale. What's the cure for that?

Exhaling.

Recessions are the economic system exhaling, and clearing the body of all the crap and dumb decisions. You can, however, put off exhaling, in which case you'll fall unconscious and exhale anyway.In economic terms "a depression".

Exchange a recession for a depression. Hmm...that seems worth it...

savingwannabe wrote: »

Sorry to hijack thread.

Me too....

savingwannabe

Oh my gosh i read last nights posts and i made a serious cockup think you were too polite to point it out but blood sugars were pants so am jolly grateful.

Bloody hell you sound just like Porge.

Why are you an undertaker? Am going to have a cup of tea and will read your posts.

Did you ever watch the story of stuff.com video?

Karmacat

Blimey. I can't think that hard ... and having gone back a bit in the thread to find out what the *dickens* people were talking about, no, I'm not talking about lightsabres :rotfl:

savingwannabe

Some sense here but i disagree with some of your inductive assumptions. One day i shall buy you a cake and a cup of tea and listen to your explanation and intercede too. Cool. Do people live to tell the tale? Do you know DVardyshadow? He and Porge and Firewalker are my heroes.

Bobster i think i like Mr Z. I was scared of you but you are ok. Helloooo. Feel genuinely sick after last night. Gonna have to go.

ZTD

Karmacat wrote: »

Blimey. I can't think that hard ...

It's not hard... Economics is just people and money - easy peasy...

Karmacat wrote: »

and having gone back a bit in the thread to find out what the *dickens* people were talking about, no, I'm not talking about lightsabres :rotfl:

Dickens and lightsabres don't seem to go well together. Though a Tale of Two Cities probably would have been livened up with lightsabres in it...