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Harry Sacks

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Posts posted by Harry Sacks

  1. 43 minutes ago, Will! said:

    After reading the Surplus Energy Economics blog I had this thought:

    I like to think of money as the lubricant that allows the energy-driven engine of the economy to run more efficiently, but the lubricant only increases the engine’s efficiency up to a point. The engine has begun to burn fuel less efficiently (with a lower Energy Return On Energy Invested) and central bankers, seeing the engine’s falling performance but not understanding how it works, have added more lubricant in the hope that this will increase its performance. Instead the engine has developed problems of over-lubrication (bubbles) and is being damaged by this (malinvestment).

    And here's how it works in practice -
    "In France, and with all sums expressed in euros at constant 2017 values, GDP grew by 23% between 2000 and 2017. But this growth, whilst adding €433bn to GDP, was accompanied by a €3.07tn increase in aggregate debt. This means that each €1 of reported growth in the French economy has come at a cost of more than €7 in net new debt. Put another way, whilst French GDP is growing at between 1.5% and 2.0%, annual borrowing is running at about 9.5% of GDP. "

    https://surplusenergyeconomics.wordpress.com/2018/12/07/140-are-yellow-jackets-the-new-fashion/?fbclid=IwAR0wgAYjIK3y44qOtO7ZcVVQHHVxmeMC9uguR-IfQYd8zn7U7z8dFmOXmIk

     

  2. 5 hours ago, spyguy said:

    Cough zimbabwee cough.

    Its not printing money thats a problems.

    Its ensuring the currency has some value and can be traded.

    Its just p1ssing around with the denominator.

     

    Yep. It's like economists take what it is that gives currency value for granted - skilled labour, resources and the products when the two are combined. Reading the MMT you'd think the end game was no one lifting a finger, in reality it would be Zimbabwe. 

    Looking at the Euro zone, there's Germany making everything and the rest are pawning whatever they have to by it, with window guidance from the ECB.

  3. 3 hours ago, localhero1983 said:

    I am amazed at the man/woman on the street, so many people being screwed over since the late 1990's  and hardly a whimper, Brexit comes along and we are now each others throats

    One of the most common Remain arguments is the prospect of falling asset values. The irony is completely lost on them. The other one is blaming "Tory austerity". I wonder how keen they'd be to swap Osborne for Schäuble under the same circumstances?

    To be honest I would prefer to remain. However, I truly believe the Euro is toast and will take the EU down with it.

  4. https://surplusenergyeconomics.wordpress.com/2018/12/07/140-are-yellow-jackets-the-new-fashion/?fbclid=IwAR0Pi3ypdcq_PGv734rzFGjGle1YTxSfWGcRl8mAkOLdo9k7JQljaG2x1Vw

     

    In France, and with all sums expressed in euros at constant 2017 values, GDP grew by 23% between 2000 and 2017. But this growth, whilst adding €433bn to GDP, was accompanied by a €3.07tn increase in aggregate debt. This means that each €1 of reported growth in the French economy has come at a cost of more than €7 in net new debt. Put another way, whilst French GDP is growing at between 1.5% and 2.0%, annual borrowing is running at about 9.5% of GDP.

  5. 26 minutes ago, bushblairandbrown said:

    What does it even mean for an institution that can create money out of thin air to have savings/assets? That's a serious question. 

    Confidence. Banks buy and sell securities. They buy things like your mortgage, and sell the financial instruments they derive from them when they refinance, either from the commercial repo market or the central bank.

    The primary driver for our current situation was not real estate, it was a shortage of AAA rated securities for emerging markets to store their surpluses, around the turn of this century. Securities based on real estate happened to be the next best thing to gov debt.

  6. On 19/12/2018 at 09:43, warrior88 said:

    I told this to a friend who was planning to go to an auction and he was shocked at the audacity of these (legal) practices.

    If he doesn't know this stuff he really shouldn't be there without someone more experienced to guide him.

    On 19/12/2018 at 21:24, GreenDevil said:

    Another shady practice is bidding up a single bidder by taking bids off the wall. So the punter ends up bidding against himself. Obviously unfair for the bidder, but the reasoning behind is that the auctioneer is "trying to reach the reserve" which is always way above the low opening bid. In this case it pays to be standing on the back wall so you can see everyone in front of you.

    Yes. I've seen it happen many times to fresh faces at car auctions.

  7. 5 hours ago, reddog said:

    So you are saying the auctioneer can make up a few bids to limp something over the reserve threshold?

     

    If so, how can that be legal?  

     

    Seems like at every turn the market is rigged to make things go higher.

    It's called "taking bids off the wall". Someone enters a Lot with an unrealistic reserve, the auctioneer can keep dropping until the first bidder "starts in", he can then continue to conjure up new bids in rapid succession in an attempt to pick up a real bid that will see over the reserve. After you've been to a few auctions it becomes very obvious.

  8. 3 hours ago, Sour Mash said:

    If it follows the pattern of the UK, the Aussie Government/ Central Bank will see them right so long as they didn't buy at the peak and aren't forced to sell in a very narrow time window when prices are at their lowest.

    We went through this on a thread here before - based on average UK prices  if you bought practically any time in the last couple of decades you wouldn't have lost out ... only those who bought in 2007 and we forced to sell in 2008/9 (or thereabouts) would have made losses.  Obviously, that's based on the average price.  I'm sure that there are specific areas where that doesn't apply.

     

    By and large the Western 'economic model' depends in large part on consumer credit creation through mortgage lending.   The governments will do ANYTHING to prop this up.  Only  catastrophic collapse will force prices significantly down for a long period.

     

     

     

    These policies are still playing out. We have no idea what the outcome will be. The bailout is ongoing. If the market shits itself again, the liabilities will be too big to bail this time. Look at the consequences of the first bailout - Trump, Brexit, rise of populism and Europe on fire.

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