Tuesday, December 11, 2012

SAR #12345

We ought to try kindness, it is almost always the right thing to do. Ian Welsh

Codetalker: When Obama says he is ready to compromise “a little bit” what he means is he's ready to cut Medicare and Social Security, kiss extended unemployment benefits goodbye and let the payroll withholding tax 'holiday' end. so the rich will pay a tiny bit more in taxes and the rest of us will get austerity. And, of course, we'll get to say "Thank You, Sir."

Over, Over There: The Bundesbank forecasts German GDP to grow, if that's the word, a miserly 0.4% next year, down from it's 1.6% prediction six months ago. The bank did suggest that things will be better if the eurozone debt crisis doesn't get worse. If.

Working For The Man: Following a decades long trend, wages have risen less than inflation for the last 22 months. Tell me how we can have a recoveryTM if workers don't have the money be consumers? Yet corporate profits are at record levels. A neat trick, accomplished by taking ever increasing amounts from the workers' wages - best summed up by the antiquated phrase "monopoly power". A term you should learn: rentier, as in"We are becoming a rentier society." If that doesn't work, try "robber barons".

Efficiency: The Republicans say we have to deprive those 65 to 67 years old of Medicare coverage, even though they've paid for it for decades, because we are too poor to keep our promises. But the real costs come in the last year of two of life, so wouldn't it make more sense to throw the older folks, say those over 85 or so, off the program?

Taedia: Please contribute.

Annals of Religion: Why, in the face of countries full of evidence that austerity ruins economies and impoverishes citizens without any appreciable benefit to anyone but the looters who profit from privatization, do the EU leaders continue to insist on economic suicide? Oh, wait...

Our Gang: Five of the CEOs behind the “Fix the Debt” charade have over $150 million in their retirement accounts. They also, together, have overseen the elimination of over 100,000 jobs in the last 5 years while claiming $48 billion in tax credits. Those are the credentials that qualify them to tell the rest of us to suck it up.

Talking Points: Conservatives are less likely to accept ideas based on scientific evidence than they are the assertions by a consensus of those they view as authorities. This does not mean they are non-thinking conformists, easily led. They are, but this doesn't prove the case.

Reality Check: In August and September over a million more Americans signed up for food stamps - three times the number of new jobs crated during the same time. That 47.7 million are now receiving benefits is, of course, a record. In the 1970's about 1 out of 50 Americans received food stamps. Now it is about 1 out of six. Republicans maintain that people avoid going to work just so they can draw the average $134.29 a month. Living high.

Misunderestimating: The IPCC, fifth report - based on data collected a few years ago and already published in the journals - will begin published in 2013. And like the previous four, it will be out of date when printed and will consistently understate the impacts that global climate change will have. And the climate deniers will claim it is being alarmist.

Unmentioned & Unmentionable: The war on terror has lasted longer than the Civil War. Longer than World War I. Longer than World War II. Longer than all three together. And has cost immensely more – over $2 trillion so far - plus the loss of international prestige and the destruction of civil rights at home. Perhaps this would be a good time to stop. It would help with the deficit.

Senatorial Immunity: Lindsey Graham (R-SC), who wants to cut Medicare and Social Security, says that the President is a "small ball guy" who is afraid of "manning up". Ah, an enlightening and well-reasoned argument.

Porn O'Graph: More, or less.

The Parting Shot:

121211

30 comments:

Sukh Hayre said...

I think the wage increases below inflation have been offset by falling interest rates, and going forward, they are being offset by the fact that savers earn interest rates that are below inflation, with the savings being passed on to the indebted workers. Those that lose their job, will have to declare bankruptcy to wipe out their debt, but this also wipes out a saver's wealth/savings/asset.

Charles Kingsley Michaelson, III said...

Sukh -
How do falling interest rates affect hourly wage earners, whose main experience with credit is in payday loans and credit cards – neither of which has even a distant nodding relationship to interest rates of the banks/Fed/bonds and such.

How are the lower interest rates earned by savers passed on to the indebted? Who are these 'savers'? Certainly most of the real money is not tied up in deposit accounts – it is out stalking the world earning huge returns that have no relationship to any interest rates.

The last point is one the 1% of the 1% should have considered before they started pushing the whole austerity idea. As I recall, the Hoja's donkey died just as it was getting used to not eating at all.

I know I'm dense, but I don't understand your argument about “offsets”. - ckm

Sukh Hayre, CGA said...

First off, let me just start by saying that I am a huge fan of Noam Chomsky and John Maynard Keynes.

Secondly, I see the world a lot differently than most.

1. I actually believe that the politicans at the top are doing what is in the best interest of the nation. The disfunction we see is nothing more like a WWF (wrestling) scripted plot that must be played out to keep the masses believing in democracy. This way they can say the country is screwed up because the "other" party keeps messing things up.

2. When a country is able to import cheap manufactured goods and oil from other countries for what will eventually become worthless IOU's, it is actually better to let the wealth of the nation become quite concentrated. This is because all the goods and services provided domestically will adjust cost-wise to the lower-level of income that the majority earn. BUT, an even bigger benefit is that it limits what this vast majority can pay for imported goods. If the wealth had been more evenly shared, the only place this additional wealth would have gone is to those that imported their goods to the country. They would have been able to extract a higher price for their goods.

This works exceptionally well for any country that has been lucky enough to be deemed the printer of the world's reserve currency. It allows them to run a huge trade balance, and in such a situation, it is best to keep the amount that can be paid for these imported goods as suppressed as possible by limiting how much the masses have in the way of disposable income to pay for these imported goods.

Everything consumed internally/domestically would not be affected. Therefore, the suppression of income actually screws those that are importing their goods into the country. The importers are forced to bite the bullet until they finally develop enough to not have to do this anymore. And this period is extended by keeping the amount that can be paid for imports suppressed.

And as this exorbitant privilege is coming to an end, the most beneficial thing a country can do (and you will find this impossible to believe) is to create a housing bubble. It is the last hooray, and it gets housing built that otherwise would not have been built.

This is all explained in the YouTube video I have posted: "You Don't Know What You Don't Know.

Sukh Hayre, CGA said...

I hope you'll take the time to visit my YouTube channel:

http://www.youtube.com/user/sukhhayre?feature=mhee

Sukh Hayre, CGA said...

In one of the posts above I said "importer" quite a few times when it should have been "exporter". Hopefully you picked up on that and read the post accordingly.

mistah charley, ph.d. said...

with regard to the topic of "kindness", Roberto Assagioli wrote:

There is in the universe, however we may conceive it, a great law of harmony, of equilibrium, of compensation; every action produces a re-action, and every violation of harmony and equilibrium rebounds, like a boomerang, against the transgressor. It is necessary, therefore, to curb our rebellions and learn to live in harmony and in tune with life. Just as the will has the power to develop itself and to control and direct the other psychological energies, so it has also the power to control and discipline itself, to confine itself within limits, to co-operate harmoniously with a group of other wills, to adhere and to subordinate itself to universal values, freely recognized and accepted.

This is the "will-to-good", and it is different from "goodwill". In "goodwill" the emphasis is on goodness. It is a benevolent attitude and disposition towards others. Goodwill is the prerequisite of understanding, the means of solving human problems; it brings about right relations; it expresses itself in co-operation; it has been called "the active principle of peace". In the will-to-good the emphasis is on the will. It is a strong determination to make the good triumph; therefore it is positive, active, dynamic. It is—-in the measure in which a human being can recognize and manifest it-—an expression of the Will of the Whole, of the Divine Will.

Robert Lowrey said...

Some of what Sukh says makes sense, however, when the Central bank managing the Reserve currency buys up the, let us say, compromised, collateral of the private banks with magic money, it keeps property values at a level that becomes disconnected from the wages of those who wish to buy, as well as increasing the overhead of all small businesses who need to pay the resulting rise in property taxes. Additionally, those big box stores that locate out in the boonies to avoid said taxes now rely on cheap fossil fuel transit to get their customer base to their football field parking lots. But low wages erode consumers' ability to afford not only the vehicle and its inexorably rising associated costs, such as insurance and maintenance, but the very real onus of rising fuel prices.

Anonymous said...

"..savers earn interest rates that are below inflation, with the savings being passed on to the indebted workers."

Only a person with absolutely NO understanding of economics or finances could ever reach such an outrageously obtuse conclusion.

Have you ever thought of working for the U.S. Fed? They'd simply L-O-V-E having you there!

Anonymous said...

"Some of what Sukh says makes sense"

Pass me the bong, so that I may understand it too.

Anonymous said...

"I hope you'll take the time to visit my YouTube channel:

http://www.youtube.com/user/sukhhayre?feature=mhee"

I did. Now I hope that YOU'll take the time to visit MINE:

http://www.youtube.com/watch?v=DiTikduJ15Y

Sukh Hayre, CGA said...

Anonymous,

Let me start with:

"We ought to try kindness, it is almost always the right thing to do." Ian Welsh

I always find it amazing how many people believe that they are so much smarter than everyone at the Fed. Never once questioning that they might be missing a big piece of the puzzle in regards to why the Fed does what it does.

I'm sure one of the videos I've posted it Alan Greenspan quoting Milton Friedman in regards to the greatness of the Fed. But, you probably believe Friedman was an idiot too.

Now, let's get to the facts:

Savings in a society serve one of two purposes, they are either directed towards investment, or they are set aside to provide for retirement.

In regards to investment, whether you are an individual wanting to start up a business, a small or medium enterprise, the next Mark Zuckerberg, or a multi-national corporation, if you have credible business expansion idea, capital has never been cheaper to get. That is a plus.

Secondly, in regards to savers: In retirement most of people's living expenses and healthcare costs are going to be covered by government entitlements, be they social security or medicare. This probably holds true for 90% of the population. Therefore, in this regards, the government is the "saver" because they will be paying for these services. And the fact that interest rates are near zero, is a huge benefit for the biggest "saver" in the U.S. economy. Wrap your head around that.

I like to give people the benefit of the doubt because most are forming opinions on incorrect data. But, if you have taken the time to actually watch the information I have posted on my YouTube channel, and you still show such disrespect in the way you respond to the things I have posted, well then, sadly, you are one of those people that will never be convinced by any level of facts. You are someone who has an opinion, but CHOOSES to have no clue.

Cheers.

Sukh Hayre, CGA said...

Robert, in regards to the Central bank buying up the compromised collateral of the private banks. This was a trade-off that was agreed to well in advance. By making bad loans, the banks helped fuel the credit bubble, thereby maximizing the benefit the U.S. had as the printer of the world's reserve currency, before this benefit was lost forever.

Secondly, there is no "real" loss here because of the interest rate differential. If the Fed buys up $1 trillion of bad loans that where the borrowers paid say 5% on average, and they replace it with $1 trillion of treasury's that pay say 1%, even if the bad collateral they took on losses 1/2 its value, over time, the compounding of the remaining 1/2 at 5% will we worth the same as the $1 trillion that was exchanged for it that only pays 1% interest.

Does that make sense.

Sukh Hayre, CGA said...

Robert,

The decline in property values will be a slow, gradual one that allows people to adjust to the new reality.

Expections ("confidence") must be carefully managed to keep the economy functioning at the highest level possible. Otherwise, if it implodes dramatically, it is a lot more difficult to start up again.

If you have the time, I hope you will makee your way to my YouTube channel and watch as many of the videos as you can.

They are only there to help people better grasp the big picture so that they can come to more informed conclusions on a wide variety of issues.

Sukh Hayre, CGA said...

Anonymous,

Should have figured that you are someone who does not believe in having a central bank as the buyer of last resort.

And you say I have no understanding of economics or finance.

Wow.

If you have taken your life savings and bought gold and silver, there is a good chance that you will be wiped out worse than all the "idiots" who didn't follow your advice. Gold may rise, the problem is, you won't know when to sell it, and/or you won't be willing or able to sell it when the time is right.

Good luck, and I hope you are living a happy and fulfilling life, because you only live once. Or as John Maynard Keynes would say, "In the long run, we're all dead."

Anonymous said...

"If you have taken your life savings and bought gold and silver, there is a good chance that you will be wiped out worse than all the "idiots" who didn't follow your advice."

In 2008 I took my entire life savings of $75K and converted it all into PHYSICAL gold & silver bullion, NOT the worthless paper variety.
Back then gold was about $800 an oz and silver around $17. Today gold is hovering at $1700 (being artificially suppressed as it it) and silver is over $30.

So, you're WRONG ...I not only DIDN'T lose my life savings ...I MULTIPLIED it exponentially! And as the dollar continues its nosedive, I'm doin' all right & gettin' good grades ...the future's so BRIGHT ...I gotta wear shades!

http://www.youtube.com/watch?v=2UMUSxBZhjA

Anonymous said...

"I always find it amazing how many people believe that they are so much smarter than everyone at the Fed."

I, on the other hand, always find it amazing how many people believe that everyone at the Fed is so much smarter than they themselves are. Then again, considering the MORONITY of the average American, the point may be moot.

In any event; I encourage you to take charge of your OWN future & financial destiny! NO ONE will ever have your best interests at heart as keenly & faithfully as YOU YOURSELF.

Sukh Hayre, CGA said...

Anonymous,

You do know what exponentially means right?

You've done well with your "investment". But, your gain is only on "paper". At what price do you plan on selling your gold?

If you never sell it, how exactly are you further ahead?

Sukh Hayre, CGA said...

Anonymous,

How much of a nest egg do you believe you need to save up to fund your retirement?

Otherthan the one-time purchase in 2008, how much gold are you buying each year?

How will your living expenses and healthcare costs be funded in retirement? What percentage of the yearly costs will come directly from government entitlements?

I'm not looking for you to reply back to me. I'm just hoping you will give these questions some thought.

Sukh Hayre, CGA said...

Anonymous,

"NO ONE will ever have your best interests at heart as keenly & faithfully as YOU YOURSELF"

Tell that to all the seniors that rely on social security and medicare today.

Ask your parents if they are thankful that someone (government) thought ahead and planned for them considering how well their own plans worked out.

And you know what, they may be the exception to the norm, but the reality is, most retirees are thankful that someone else did have a plan.

Anonymous said...

"The decline in property values will be a slow, gradual one that allows people to adjust to the new reality."

Indeed. And that "new reality" will consist in a completely deteriorated quality of life & living standards for the rapidly shrinking middle class, as the American citizenry is pauperized into oblivion. Meanwhile, power & wealth CONTINUES to be monopolized & concentrated into the hands of a few select financial & corporate entities.

Simultaneously Constitutional rule of law is purposely eroded and openly violated as the judiciary becomes gradually irrelevant.

Draconian laws fostered by the overzealous Geheime Staatspolizei of today (think Homeland Security) are passed to ensure the continued "freedoms" of the American people ...even as these very same freedoms are DESTROYED in the process.

What is currently happening in the United States of America is a pivotal moment in history and these days that we are currently living thru are truly an incredibly unique & exciting experience, namely: to witness the COLLAPSE OF AN ENTIRE EMPIRE!!!

Got popcorn?

Charles Kingsley Michaelson, III said...

Hey, Gang. Not to interupt things, but could we please identify ourselves. You don't need to sign in, but just put a tag at the end of your Anonymous entry so I can keep track of whose serve it is. Like this.... ckm. (well, don't use ckm, use almost anything else...) Thanks.

Sukh Hayre, CGA said...

There is no country on earth that is richer than the U.S. (and Canada, because the two really do need to be seen as a whole) on a per capita basis.

There is no place on earth that is a better place to live than North America.

Yes, it is the end of empire. The U.S. has extracted as much as it can from the rest of the world, and that is now coming to an end. In return, the U.S. has provided the world a ton of intellectual property that other nations have, and are, using to leapfrog into the 21st century.

Homeland security is another Keynesian (and I mean it in a good way) make-work project that the free-market public would accept in the U.S.

Going forward, you will find that we, in North America, have actually gotten past the point of scarcity on which Adam Smith based many of his economic principals. Remember, he also wrote about moral sentiments.

So, we are now going through a period of adjustment. There will be more leisure time for everyone going forward because so much of the work we used to do has been automated. The key is to continue to produce these goods, which we are capable of producing, and provide people. This calls for a paradigm shift in our way of economic thinking. This shift will come, but it will be a slow process.

So, yes, life is going to be good, future is so bright, we do gotta where shades, but for a bunch of positive reasons, not the bleak world that you envision and are planning for.

You only live once. Make sure you enjoy the ride, and that enjoyment comes from the things you do, and not just waiting for other people's misery.

Sukh Hayre, CGA said...

Charles,

I've posted under my name, is that sufficient?

I think I've pretty much said all I wanted to say. Would love your thoughts.

Anonymous said...

"How much of a nest egg do you believe you need to save up to fund your retirement?"

Irrelevant question to any point of our conversation. But I'll respond to it anyway: AS MUCH AS I POSSIBLY CAN!

"Other than the one-time purchase in 2008, how much gold are you buying each year?"

Irrelevant question to any point of our conversation. But I'll respond to it anyway; SOME!

"How will your living expenses and healthcare costs be funded in retirement?"

Irrelevant question to any point of our conversation. But I'll respond to it anyway: SAVINGS!

"What percentage of the yearly costs will come directly from government entitlements?"

Irrelevant question to any point of our conversation, which by the way was originally about how people should EDUCATE & INFORM THEMSELVES REGARDING FINANCIAL MATTERS & ECONOMIC TRENDS, but I'll respond to it anyway: I EXPECT TO RECEIVE ABSOLUTLEY *NO* FINANCIAL HELP FROM *ANY* UNITED STATES GOVERNMENT AGENCY *EVER* in *ANY* shape or form, DESPITE my many years of Social Security contributions, mainly because I know that those funds have been RAIDED and they NO LONGER EXIST. Which is why I took my financial future into my own hands to begin with. If I get anything it would be icing on the cake. A cake that *I* baked & decorated with my own two li'l hands.

Wanna slice? Uh, uh, uh! Go ask your Uncle Obama for one!

Anonymous said...

"Hey, Gang. Not to interupt things, but could we please identify ourselves"

Good idea, if only because I'm a big fan of coherency. Will do! I'll add the handle of "Recoveryless Recovery" at the end of my posts. I think the sobriquet epitomizes my stance.

Charles Kingsley Michaelson, III said...

Okay, Recoveryless. And Sukh, in that you are using an established identity to post from you were in the right pew to begin with. ckm.

Anonymous said...

"Going forward, you will find that we, in North America, have actually gotten past the point of scarcity on which Adam Smith based many of his economic principals. Remember, he also wrote about moral sentiments."

The economic principles of Adam Smith are as dead as ol' Adam Smith himself ..or even DEADER ..if such a thing were possible.
TODAY we are living thru a period of MASSIVE & RAMPANT GOVERNMENT CORRUPTION, the likes of which have NEVER been seen before in the annals of American history. Sam would SPIN in his grave.

"So, we are now going through a period of adjustment. There will be more leisure time for everyone going forward because so much of the work we used to do has been automated. The key is to continue to produce these goods, which we are capable of producing, and provide people. This calls for a paradigm shift in our way of economic thinking. This shift will come, but it will be a slow process."

We're adjusting to a period of COLLAPSE. Of INEPTITUDE. Of CORRUPTION. Of MORAL & FINANCIAL IMPLOSION.
There will be more leisure time for everyone going forward because people will be UNEMPLOYED. HOMELESS. BROKE.
So much of the work we used to do has been EXPORTED.
Yes, the key is to continue to produce these goods, which we are capable of producing, but we DON'T produce anything. WE'RE CONSUMERS". We have a culture of GORGING ourselves which is why we have the most morbidly obese population of the world. The paradigmic shift in our way of economic thinking has ALREADY OCCURRED: we somehow think that we can payoff debt with yet MORE debt!
Crazy is the new norm.

"So, yes, life is going to be good, future is so bright, we do gotta where shades, but for a bunch of positive reasons, not the bleak world that you envision and are planning for."

Hold your horses thar partner: the future's gonna look bright ONLY for people like ME because of all the preventive measures & evasive action that we've taken in preparation, which in my personal case includes includes owning property overseas & a second passport. YOU & the people who think like you on the other hand are UTTERLY & COMPLETELY F'ed.

"You only live once. Make sure you enjoy the ride, and that enjoyment comes from the things you do, and not just waiting for other people's misery."

Blah, blah, blah. You live in a country that's guilty of massive war crimes, financial fraud, violations of Human Rights, murders, rape, torture, espionage, kidnapping ...ALL done as part of official government policy. YOU are the CAUSE of other people's misery! So save it for a Disney film.

RecoverylessRecovery

Sukh Hayre, CGA said...

I'll let you have the last word.

Sukh Hayre, CGA said...

And by the way, I'm Canadian.

So, you couldn't have watched the video I linked you to at the very beginning because the title of it was: You Don't Know What You Don't Know - What Middle-Class Canadians Need To Know.

Anonymous said...

"And by the way, I'm Canadian."

Ah, America's 51st state!

Washington DC says, 'Jump!" and the Canadian government responds, "How high?"

RecoverylessRecovery