I am doing a thought experiment. Too much time on my hands!
Suppose, when Greenspan told Bush “surpluses were no good”, seemingly because they would drive down long term interest rates due to I think an excess incomes over consumption, saving. Aside; like in Japan?
Suppose instead of treasury selling T-Bills in the private market Greenspan bought them all at the interest rate he wished and kept them in the Fed?
What would have been different?
Either way the Fed printed lots of money, and the money chased the same cheap imports from a money controlled China.
And to throw in a kicker, suppose payroll taxes were on pay-go and workers held the money from reduced SS taxes to spend and save as they were wont?
Suppose instead of treasury selling T-Bills in the private market Greenspan bought them all at the interest rate he wished and kept them in the Fed?
Now you have a transaction operating without regard to marked determined rates, which could be either higher or lower than target. Surley this would be abberant behaviour. What would the intended and unintended consequences be? Anyone?
And to throw in a kicker, suppose payroll taxes were on pay-go and workers held the money from reduced SS taxes to spend and save as they were wont?
The liberal (labor) party has a one vote advantage over the conservative party in the parliamentary election. Neither party have the simple majority needed to form a Government. The conservative candidate, Tony Abbott, was expected to have NO CHANCE, but he campaigned upon: “Mr Abbott defied expectations, shedding his reputation for being a loose cannon to emerge as a viable alternative prime minister. He courted popularity with blunt pledges to “stop the [asylum seeker] boats, pay back the debt and stop the big new taxes”.”
On the whole issue of the US as a spendthrift nation. In the book Upstream Metropolis a history of Omaha, on P 216 there is a snippet from the Council Bluffs newspaper in 1910 saying that the american is the spendthrift of the world, who does not what frugality means. Its interesting to see this meme 100 years ago. (Here it was juxtaposed with bachelors from southern europe in terms of why there had just been riots). Ignoring the details of why the editorial was published, this may be correlated with our national desire to get rich quick. Recall that CA was founded by a get rich quick scheme (gold rush), as indeed was much of the west. Many of our founding fathers were land speculators, and sought to get rich quick on land west of the mountians. Both New York and Jamestown were get rich quick schemes at their founding. Being willing to participate in a get rich quick scheme may explain the willingness of americans to try something new, as well as their ability to fall for folks like Bernie Madoff.
“Climate Science™: We must act now, the end of the world is coming. Science minded individual: That’s scary, what do you mean? Climate Science™: The globe is warming from CO2 emissions, glaciers will melt, storms will strengthen, droughts will become commonplace, plantlife will die, the oceans will rise, the polar ice will melt, oceans will acidify, we must act now! Science minded individual: Wow, CO2 causes all that? How do you know? Climate Science™: We have dozens of lines of evidence, Models, measurements, paleoclimate data, environmental data, it’s all in agreement. We must act now. Science minded individual: Let’s see, I’ll start with the paleo reconstructions. Hmm, it seems that the unprecedentedness is due to your mathematical techniques and a few unique proxies, why is it that we can remove a couple of key data series and the whole thing turns to a flat line? Climate Science™: There is uncertainty in science, engineers and physicists have trouble understanding. These reconstructions don’t matter anyway, there are dozens of other branches and they are all in agreement. We must act before it’s too late! Science minded individual: But you agree the paleo reconstructions are in error? Climate Science™: They are unimportant, when you combine the whole of climatology the answer is clear. We must act to save mankind now!! Science minded individual: Then why have them? Climate Science™: Models project 4 C of warming by the end of the century, they agree with paleo reconstructions. Warming on this scale will bring destruction across the globe. Science minded individual: Ok, moving on, I see that models all seem to assume a positive feedback to a small temeprature rise. Climate Science™: It’s caused by water vapor in the atmosphere. The water vapor increases the global warming effect, crops will die, fish will shrink, people will starve if we don’t act. Science minded individual: I see also that there is quite a bit of uncertainty in the amount of feedback. Climate Science™: There is uncertainty in all science, perhaps you don’t understand that concept. We know it’s bettween 2 and 6 C of warming in the next century alone. Science minded individual: Wow, that’s a lot of uncertainty. Why aren’t the measurements which show a negative feedback being used? Climate Science™: Consensus says that a positive feedback is correct we must act now. Science minded individual: But some believe the feedback is negative and what about the recent proofs on the internet and in publication that models have overshot measured data by 2 to 4 times? Climate Science™: The IPCC represents the whole of climate science, the bulk of the evidence is in favor of 2 to 4C of warming. The sea ice and ice caps will melt, the ocean is rising, low lying land will flood, storms will grow stronger. Science minded individual: Hurricanes haven’t grown stronger, they’ve weakened. Climate Science™: You don’t understand the difference between weather and climate. Science minded […]
Contd from above: “Climate Science™: We must act globally to stop burning fossil fuels, stop cutting trees and adopt renewable energy. Science minded individual: What is renewable energy? Climate Science™: Energy which can be created from things like biofuels, wind, solar, geothermal. Science minded individual: Won’t it be bad for humanity if we don’t produce enough electricity, or it comes at too high a cost? Climate Science™: Industry is destroying the planet, we must act now. We’ve calculated that the damage from global warming is much more serious than a tax on energy. Science minded individual: So you want to tax energy? Climate Science™: We need to limit and eventually stop fossil fuel usage before it’s too late. Science minded individual: Why biofuels? Chlorophyl can’t come close to catching enough energy to power even our cars. Climate Science™: We must explore all avenues to achieve our goals. Science minded individual: But biofuel doesn’t and can’t work, and a first year engineering student can calculate it? Also, solar power is several times higher cost than any other methods and we can’t store it for use at night. It will be horribly damaging to industry if we have electricity that’s several times higher in cost. Climate Science™: We must explore all avenues, we’re trying to save the world, if higher cost energy has a negative effect on industry it will be far better than what will happen if we don’t act now. Science minded individual: I notice that wind has similar problems and requires fast acting powerplants to offset when they aren’t turning. None of these solutions seems to work for our problem, what about nuclear. Climate Science™: Nuclear is part of the answer. Science minded individual: Nuclear seems to be the only working answer, and it doesn’t work for cars because we have no good batteries. I notice you didn’t mention nuclear above. Climate Science™: Everyone will have to make sacrifice for the good of the planet. Nuclear has problems with waste and safety so new technologies must be developed. Science minded individual: But it can prevent the disaster right, and we don’t have the technology to change to a different source. If we limit production the cost of everything will rise and people will starve? Climate Science™: We all must make sacrifices because not changing to renewable energy is far more dangerous than the damage to industry. We must form a global coalition to fight CO2 emission today, we don’t have time to wait. Science minded individual: With all the predictions and uncertainty, how are you so sure that something as severe as shutting down industry is the right idea? I mean, you recommend a global coalition to tax successful countries and send the money to unsuccessful ‘developing’ countries for the purpose of balancing economies, yet that seems to have nothing to do with solving global warming.? Climate Science™: Developing countries will be the worst polluters in the future, wealthy nations are known to be cleaner, so we must transfer the technology and ability to produce clean energy to developing nations. Science minded individual: But wait a minute, don’t modern and properly managed nations need to work to stop emitting, aren’t these the countries which are creating the problem? Why would modern society spend today’s resources on the repressed governments and the medieval cultures in developing nations which repress their people, technology and […]
I am doing a thought experiment. Too much time on my hands!
Suppose, when Greenspan told Bush “surpluses were no good”, seemingly because they would drive down long term interest rates due to I think an excess incomes over consumption, saving. Aside; like in Japan?
Suppose instead of treasury selling T-Bills in the private market Greenspan bought them all at the interest rate he wished and kept them in the Fed?
What would have been different?
Either way the Fed printed lots of money, and the money chased the same cheap imports from a money controlled China.
And to throw in a kicker, suppose payroll taxes were on pay-go and workers held the money from reduced SS taxes to spend and save as they were wont?
Is this just a trip down voodoo economics?
Suppose instead of treasury selling T-Bills in the private market Greenspan bought them all at the interest rate he wished and kept them in the Fed?
Now you have a transaction operating without regard to marked determined rates, which could be either higher or lower than target. Surley this would be abberant behaviour. What would the intended and unintended consequences be? Anyone?
And to throw in a kicker, suppose payroll taxes were on pay-go and workers held the money from reduced SS taxes to spend and save as they were wont?
Is this just a trip down voodoo economics?
Yes.
Cheers!
JzB
I’ll keep it simple. Greenspan is full of crap and don’t listen to anything he said or says.
Australian election results in deadlock
The liberal (labor) party has a one vote advantage over the conservative party in the parliamentary election. Neither party have the simple majority needed to form a Government. The conservative candidate, Tony Abbott, was expected to have NO CHANCE, but he campaigned upon: “Mr Abbott defied expectations, shedding his reputation for being a loose cannon to emerge as a viable alternative prime minister. He courted popularity with blunt pledges to “stop the [asylum seeker] boats, pay back the debt and stop the big new taxes”.”
Any of that sound familiar?????
Quote from here: http://www.telegraph.co.uk/news/worldnews/australiaandthepacific/australia/7957876/Australian-election-delivers-hung-parliament.html
On the whole issue of the US as a spendthrift nation. In the book Upstream Metropolis a history of Omaha, on P 216 there is a snippet from the Council Bluffs newspaper in 1910 saying that the american is the spendthrift of the world, who does not what frugality means. Its interesting to see this meme 100 years ago. (Here it was juxtaposed with bachelors from southern europe in terms of why there had just been riots). Ignoring the details of why the editorial was published, this may be correlated with our national desire to get rich quick. Recall that CA was founded by a get rich quick scheme (gold rush), as indeed was much of the west. Many of our founding fathers were land speculators, and sought to get rich quick on land west of the mountians. Both New York and Jamestown were get rich quick schemes at their founding. Being willing to participate in a get rich quick scheme may explain the willingness of americans to try something new, as well as their ability to fall for folks like Bernie Madoff.
I think the fed runs counter market, at least since Vlocker left.
I realize this comment won’t be up very long due to the roll down as new are added, but this farcical discussion cuts to the core of the Climate Change debate. From here: http://noconsensus.wordpress.com/2010/08/22/understanding-climate/#comments
“Climate Science™: We must act now, the end of the world is coming.
Science minded individual: That’s scary, what do you mean?
Climate Science™: The globe is warming from CO2 emissions, glaciers will melt, storms will strengthen, droughts will become commonplace, plantlife will die, the oceans will rise, the polar ice will melt, oceans will acidify, we must act now!
Science minded individual: Wow, CO2 causes all that? How do you know?
Climate Science™: We have dozens of lines of evidence, Models, measurements, paleoclimate data, environmental data, it’s all in agreement. We must act now.
Science minded individual: Let’s see, I’ll start with the paleo reconstructions. Hmm, it seems that the unprecedentedness is due to your mathematical techniques and a few unique proxies, why is it that we can remove a couple of key data series and the whole thing turns to a flat line?
Climate Science™: There is uncertainty in science, engineers and physicists have trouble understanding. These reconstructions don’t matter anyway, there are dozens of other branches and they are all in agreement. We must act before it’s too late!
Science minded individual: But you agree the paleo reconstructions are in error?
Climate Science™: They are unimportant, when you combine the whole of climatology the answer is clear. We must act to save mankind now!!
Science minded individual: Then why have them?
Climate Science™: Models project 4 C of warming by the end of the century, they agree with paleo reconstructions. Warming on this scale will bring destruction across the globe.
Science minded individual: Ok, moving on, I see that models all seem to assume a positive feedback to a small temeprature rise.
Climate Science™: It’s caused by water vapor in the atmosphere. The water vapor increases the global warming effect, crops will die, fish will shrink, people will starve if we don’t act.
Science minded individual: I see also that there is quite a bit of uncertainty in the amount of feedback.
Climate Science™: There is uncertainty in all science, perhaps you don’t understand that concept. We know it’s bettween 2 and 6 C of warming in the next century alone.
Science minded individual: Wow, that’s a lot of uncertainty. Why aren’t the measurements which show a negative feedback being used?
Climate Science™: Consensus says that a positive feedback is correct we must act now.
Science minded individual: But some believe the feedback is negative and what about the recent proofs on the internet and in publication that models have overshot measured data by 2 to 4 times?
Climate Science™: The IPCC represents the whole of climate science, the bulk of the evidence is in favor of 2 to 4C of warming. The sea ice and ice caps will melt, the ocean is rising, low lying land will flood, storms will grow stronger.
Science minded individual: Hurricanes haven’t grown stronger, they’ve weakened.
Climate Science™: You don’t understand the difference between weather and climate.
Science minded […]
Contd from above:
“Climate Science™: We must act globally to stop burning fossil fuels, stop cutting trees and adopt renewable energy.
Science minded individual: What is renewable energy?
Climate Science™: Energy which can be created from things like biofuels, wind, solar, geothermal.
Science minded individual: Won’t it be bad for humanity if we don’t produce enough electricity, or it comes at too high a cost?
Climate Science™: Industry is destroying the planet, we must act now. We’ve calculated that the damage from global warming is much more serious than a tax on energy.
Science minded individual: So you want to tax energy?
Climate Science™: We need to limit and eventually stop fossil fuel usage before it’s too late.
Science minded individual: Why biofuels? Chlorophyl can’t come close to catching enough energy to power even our cars.
Climate Science™: We must explore all avenues to achieve our goals.
Science minded individual: But biofuel doesn’t and can’t work, and a first year engineering student can calculate it? Also, solar power is several times higher cost than any other methods and we can’t store it for use at night. It will be horribly damaging to industry if we have electricity that’s several times higher in cost.
Climate Science™: We must explore all avenues, we’re trying to save the world, if higher cost energy has a negative effect on industry it will be far better than what will happen if we don’t act now.
Science minded individual: I notice that wind has similar problems and requires fast acting powerplants to offset when they aren’t turning. None of these solutions seems to work for our problem, what about nuclear.
Climate Science™: Nuclear is part of the answer.
Science minded individual: Nuclear seems to be the only working answer, and it doesn’t work for cars because we have no good batteries. I notice you didn’t mention nuclear above.
Climate Science™: Everyone will have to make sacrifice for the good of the planet. Nuclear has problems with waste and safety so new technologies must be developed.
Science minded individual: But it can prevent the disaster right, and we don’t have the technology to change to a different source. If we limit production the cost of everything will rise and people will starve?
Climate Science™: We all must make sacrifices because not changing to renewable energy is far more dangerous than the damage to industry. We must form a global coalition to fight CO2 emission today, we don’t have time to wait.
Science minded individual: With all the predictions and uncertainty, how are you so sure that something as severe as shutting down industry is the right idea? I mean, you recommend a global coalition to tax successful countries and send the money to unsuccessful ‘developing’ countries for the purpose of balancing economies, yet that seems to have nothing to do with solving global warming.?
Climate Science™: Developing countries will be the worst polluters in the future, wealthy nations are known to be cleaner, so we must transfer the technology and ability to produce clean energy to developing nations.
Science minded individual: But wait a minute, don’t modern and properly managed nations need to work to stop emitting, aren’t these the countries which are creating the problem? Why would modern society spend today’s resources on the repressed governments and the medieval cultures in developing nations which repress their people, technology and […]