Inflating Away The National Debt

[Stars]

And if he doesn't say those words, you've lost nothing.

That depends on the situation - an actor by deciding not to act when he earlier said he would, might indirectly cause quite a change in risk - and what happens as a result depends on the agreement and other things like laws

When the agreement concept meets the reality of it not happening, the agreement is thrown out, not the reality.

If the agreement has not happened, then there is no agreement.

Did you mean to say something else?

In a credit system, future events are traded as though they were past and already manifest. Which is impossible imaginary tosh, obviously.

You mean, like when somebody (say) pays a painter to paint a wall?

Is somebody paying you for this ?

[Injin]

That depends on the situation - an actor by deciding not to act when he earlier said he would, might indirectly cause quite a change in risk - and what happens as a result depends on the agreement

It won't change the risk - it doesn't change anything in reality because nothing has happened yet. What it will change is your ideas about reality which is somethign else altogether.

and other things like laws

You can't make something real by referring to another fantasy.

If the agreement has not happened, then there is no agreement.

Did you mean to say something else?

If the agreement has happened and none of the things which are agreed have been embarked upon, then nothing has happened but the agreement. As the agreement isn't releated to anything real, it's invalid.

You mean, like when somebody (say) pays a painter to paint a wall?

What's this got to do with credit?

Is somebody paying you for this ?

Not yet.

For some reason you still think that conceptions should override actual events.

[Guest Steve Cook]

All this talk of inflation is discussing the symptoms, not the causes. Financial assets, including cash, represent a call on someone else's output or on primary stuff (forms of energy - oil, coal, gas). You can increase the cash in circulation as much as you like - you can inflate house prices, promise yourselves bigger pensions, etc etc - but all it represents is a call on your kids' output and/or on energy. The mantra is:

High House Prices Are A Blank Cheque Drawn On Your Kids.

And the problem is they - we - can't pay it. End of.

The post-war "Golden Era" had it all. Fewer people thanks to wars, devastated countries to rebuild so lots of opportunities, a comparatively young and growing population, lots of brand new technologies developed at fantastic cost by governments ready to be transferred to the private sector, etc etc. And for oil all you had to do in large parts of the Middle East was stick a pipe in the ground.

Then we get business education and economics as it has developed during that period. Systematically exploit everything possible in the name of efficiency, and externalise all costs because then they're "free". Doesn't matter if you pollute the seas, atmosphere, etc etc, because that doesn't figure in the bottom line and whatever increases GDP is all good. Game theory is all.

We now live in a full world where we have to drill miles down for oil. If we manage to kill of the bees we'll have to redeploy our convicts with little brushes going round pollinating plants. And no, I'm not kidding. We are in the middle of a systemic catastrophe and we're systematically lying to ourselves with feel-good stories about a few years of austerity and then it will be BAU. Complete and utter sentimental twaddle.

The "wall of money" of savings and pension funds scouring the world in the quest for yield is a disaster that is slowly unfolding. This idea that people should earn more than they spend is a fantasy, because that "surplus" is nothing more than a demand on someone else in the future to support them. In the good old days it could be legitimately argued that a surplus was used to invest in productive businesses, so there would be more in the future. That model is broken. The idea that savings would be invested in making things better in the future has turned into a nightmare world where that "surplus" stalks the world blowing bubbles and accelerating the rate at which we are destroying our eco-system to "pay back" those "liabilities" from people who invented a fictitious surplus.

Inflation is a red herring. The reality is, energy is everything. Without it the Odyssey is dead. (It's a line from Apollo 13. The engineers are discussing how to get the crew home, and the electrical guy pipes up and says "Power is everything. Without power we can't run the systems, open the chutes, etc etc." It's a good metaphor - a self-contained system with limited resources that can't be substituted for. It emphasises the lie peddled by economists that when something runs out we can always substitute something else. There's no substitute for cheap energy other than fusion, perhaps, and I'll believe that one when I see it.)

bingo

[Guest Steve Cook]

If we already owe them everything, so what?

Print the debt, pass protectionist laws against foreigners owning anything important, sorted.

I think that's the point at which the troops get mobilised.

Unless you've got a bigger army, of course...

[Bloo Loo]

It is the second you claim a loss when tomorrows bread doesn't arrive.

Should be a clue for you that something not rational is occuring.

This is a very good point.

Bankers have been claiming profits, and indeed selling "assets", based on the promise by others to pay up tommorrow.

this works usually.

BUT, bankers have been selling loans (CREDIT) to people that are unlikely, and in many cases, impossible to play out.knowingly. They have turned a blind eye to LIAR LOANS.

They have sold CDOs promising a better return than Soveriegn debt, based on these same loans...

these are nothing but fraud.

A credit is not profit until its paid up in full. to claim otherwise is a fraud...if it were not so, there would be no credit crunch and the need for "real" cash to cover for these "assets".

And now, the ECB is taking the Greek "assets", which are unpayable..as collateral too.

[Injin]

This is a very good point.

Bankers have been claiming profits, and indeed selling "assets", based on the promise by others to pay up tommorrow.

this works usually.

BUT, bankers have been selling loans (CREDIT) to people that are unlikely, and in many cases, impossible to play out.knowingly. They have turned a blind eye to LIAR LOANS.

They have sold CDOs promising a better return than Soveriegn debt, based on these same loans...

these are nothing but fraud.

A credit is not profit until its paid up in full. to claim otherwise is a fraud...if it were not so, there would be no credit crunch and the need for "real" cash to cover for these "assets".

And now, the ECB is taking the Greek "assets", which are unpayable..as collateral too.

Bu8t that's exactly why ALL credit is fraud - it's a pretence that possible future actions are the same as actual past ones.

Even if it comes off it wea a lie.

If you give stuff away, you have given stuff away - even if you have a piece of paper with some scribbles on it and someone has told you you will get more back later.

Edited May 4, 2010 by Injin

[munro]

bingo

You'd think it would be obvious, wouldn't you...*sigh*

[Injin]

You'd think it would be obvious, wouldn't you...*sigh*

Freedom = productivity = predators = less freedom = less productivity = predators up their game to maintain their standard of living = less freedom

The standard cycle of "civilisation." All the oil and that stuff doesn't have much to do wiuth the thing that really powers society and economics, which is how it is organised and who gets the rewards.

[CokeSnortingTory]

The Government will attempt to keep inflation at the 4 to 5% level to halve the debt over a 10 to 15 year period.

This will be an attempt to monetise without creating too many shocks in the social sphere.

Expect inflation to stay at this level fairly consistently, with the BoE offering many words of "concern" about inflation "obstinately refusing to come into target" while doing their best to keep it there.

[Bloo Loo]

The Government will attempt to keep inflation at the 4 to 5% level to halve the debt over a 10 to 15 year period.

This will be an attempt to monetise without creating too many shocks in the social sphere.

Expect inflation to stay at this level fairly consistently, with the BoE offering many words of "concern" about inflation "obstinately refusing to come into target" while doing their best to keep it there.

just a mo...inflation means pay rises, means higher structural deficit...which means nothing is solved.

[CokeSnortingTory]

just a mo...inflation means pay rises, means higher structural deficit...which means nothing is solved.

Depends really on the level of unemployment, which I think will remain very high.

I'm not saying that this will actually work of course, I'm just saying that this is what they will attempt to do (are actually doing now).

[Bloo Loo]

Depends really on the level of unemployment, which I think will remain very high.

I'm not saying that this will actually work of course, I'm just saying that this is what they will attempt to do (are actually doing now).

the administrators that run things rely 100% on numbers, tables, graphs to see how things work.

they prioritise things and focus these days on GDP.

it matters not to them that GDP can be fiddled, indeed with no private sector at all, GDP could be running at 5, 10 100%, whatever, yet the country could be a barren rock.

course, those recieving the grace of handouts luv them....meanwhile, that huddled figure starving in the doorway could be you.

[Stars]

It won't change the risk - it doesn't change anything in reality because nothing has happened yet.

Yes, something did happen; somebody entered into an agreement to do something. If they also agree a penalty for not doing something (or one is implied) then that can change the risk experienced by somebody who might rely in some way on them doing this thing.

What's this got to do with credit?

I have no idea, you brought up the idiotic 'future events' concept, i'm humouring you and wondering at your capacity to add more and more gumpf to keep your religion intact

[Injin]

Yes, something did happen; somebody entered into an agreement to do something. If they also agree a penalty for not doing something (or one is implied) then that can change the risk experienced by somebody who might rely in some way on them doing this thing.

*headdesk*

If someone tells you they will do something then doesn't do it they are either mistaken or lying. in which case all they have done is prove you never had an agreement!

Stop putting words over actions, promises over events - it's mental.

I have no idea, you brought up the idiotic 'future events' concept, i'm humouring you and wondering at your capacity to add more and more gumpf to keep your religion intact

You are the one who thinks his ideas about the world and other peoples behaviour should be forced to happen when the world and other peoples behaviour doesn't conform.

i'm being empircial, you are being a fantasist. So much of a fantasist in fact that you are utterly rejecting actual events.

Edited May 4, 2010 by Injin

[Stars]

If someone tells you they will do something then doesn't do it they are either mistaken or lying. in which case all they have done is prove you never had an agreement!

Amusing but vacuous - you cannot be mistaken about whether you agree to something and so we are talking about somebody who is lying, right?

[Injin]

Amusing but vacuous - you cannot be mistaken about whether you agree to something and so we are talking about somebody who is lying, right?

You can be mistaken about delivery of the promise.

For example - you can promise to pay your mortgage, be totally committed to that route and then your firm goes bust out of the blue and you are simply unable.

Which is why all credit is fraud, obviously. It's an attempt to treat future events with the same certainty as passed ones and when the future events dont occur, saying that it's the real events that are deficient and not the agreement. I met this exact same problem on a thread about contracts a few weeks ago - pretty near everyone thought it was more important that there had been a promise made than the fact that the promise was impossible.

I'd love to know where it comes from, this mad rejection of actuality, though I suspect it's from small children being put in impossible positions by their parents and carrying it forward to adulthood.

[Stars]

You can be mistaken about delivery of the promise.

For example - you can promise to pay your mortgage, be totally committed to that route and then your firm goes bust out of the blue and you are simply unable.

Absolutely. or you might just piss it up a wall and not bother paying. The purpose of this apparent agreement thing is to assure both parties that the other party will only fail to undergo the apparently agreed future actions are if he is unable to do so. This allows the other party more easily to put a non-infinite number on the risk he is taking in entering the agreement

Which is why all credit is fraud, obviously.

keep praying

It's an attempt to treat future events with the same certainty as passed ones and when the future events dont occur, saying that it's the real events that are deficient and not the agreement.

But only as a secondary consequence of a rather gormless position.

You are saying that any arrangment governed by a contract is fraud if it refers to events that could happen in the future. Therefore credit is fraud because it involves an agreement to do something (as do most contracts)

Edited May 4, 2010 by Stars

[Injin]

Absolutely. or you might just piss it up a wall and not bother paying. The purpose of this apparent agreement thing is to assure both parties that the other party will only fail to undergo the apparently agreed future actions are if he is unable to do so. This allows the other party more easily to put a non-infinite number on the risk he is taking in entering the agreement

That number will be a fraud. Only fooling yourself.

keep praying

See above.

But only as a secondary consequence of a rather gormless position.

You are saying that any arrangment governed by a contract is fraud if it refers to events that could happen in the future. Therefore credit is fraud because it involves an agreement to do something (as do most contracts)

It's fraud if you want to treat it as equivalent to past events.

Credit is a mutual promise to do stuff at some point in the future. It's a fantasy until something actually happens.

Edited May 4, 2010 by Injin

[Stars]

That number will be a fraud. Only fooling yourself.

And now a number in sombody's head is fraud?

Are all numbers fraud as well?

It's fraud if you want to treat it as equivalent to past events.

ok..sigh..this is word salad

Credit is a mutual promise to do stuff at some point in the future. It's a fantasy until something actually happens.

As i pointed out, just about all contracts revolve around and refer to future actions. Can you think of an example of a contract revolving around past actions?

Edited May 4, 2010 by Stars

[Injin]

And now a number in sombody's head is fraud?

A numerical value assigned with certainty to what is actually an unknowable future event is, yes. Taleb has some interesting things to say about that, as do others.

Are all numbers fraud as well?

Useful lies. Where they match something that really exists, they are valid. You can have 5 rocks, but you can't have 5 without the rocks.

ok..sigh..this is word salad

No, it's your mixxing up of previous actions and future ones and wanting the future ones to have the same status in thought and behaviour.

As i pointed out, just about all contracts revolve around and refer to future actions. Can you think of an example of a contract revolving around past actions?

All valid contracts revolve around past actions.

Otherwise they aren't contracts, they are pieces of paper that refer to nothing real. you say that the contract is "broken" - by which you mean the real world has come up short on your expectations of it. I say you got it wrong - as the real world can never be wrong, only our thoughts about it can be.

Whether something is a contract or not is decided by actions in reality, not by the happy thoughts inside your head. You can thank me if you ever get your head around what I am saying by awarding yourself a nobel prize for potential thinking.

Edited May 4, 2010 by Injin

[Stars]

A numerical value assigned with certainty to what is actually an unknowable future event is, yes.

No, it's just a number in somebody's head.

If i assign a probability to an action you may do in the future, no fraud has taken place.

Useful lies. Where they match something that really exists, they are valid. You can have 5 rocks, but you can't have 5 without the rocks.

So, the words "i think there is a 50% chance of there being five rocks tommorow" amount to a 'fraudulant statement'?

Hilarious

All valid contracts revolve around past actions.

A valid contract is an agreement to do something in the past?

That is funny

I think that position qualifies as a contradiction..ie no valid contract exists; which was the point in my previous post.

Edited May 4, 2010 by Stars

[Injin]

No, it's just a number in somebody's head.

If i assign a probability to an action you may do in the future, no fraud has taken place.

Did you miss the "with certainty" bit again?

So, the words "i think there is a 50% chance of there being five rocks tommorow" amount to a 'fraudulant statement'?

Hilarious

Not at all. However, this isn't what credit does, is it?

"John has promised me 5 rocks tomorrow and therefore I have 5 rocks already." - that's credit.

A valid contract is an agreement to do something in the past?

That is funny

I think that position qualifies as a contradiction..ie no valid contract exists; which was the point in my previous post.

No (like all things) whether a contract is valid or not is found by actual performance.

You can't have a piece of paper where none of the events it describes have happened and then say it's a contract, crazy idea.

It's comical, you are accusing me of all the things you yourself are doing.

Edited May 4, 2010 by Injin

[Stars]

Did you miss the "with certainty" bit again?

I didn't miss it, i ignored it . You added 'with certainty' to a description of somebody evaluating the future. I have No idea why you did that as it has no bearing on any reality being described or any relevance to anything being fraud or not fraud.

Not at all. However, this isn't what credit does, is it?

Evaluations like "i think there is a 50% chance of there being five rocks tommorow", are one of the types of evaluations involved in credit.

You said earlier that this sort of statement is fraud....have you changed your position, now?

Can we now agree that evaluating the future is not commiting fraud?

"John has promised me 5 rocks tomorrow and therefore I have 5 rocks already." - that's credit.

Nope

"John has promised me five rocks tommorow, can i have four potatos now and you collect the five rocks, later?" or "Give me fuel and tractor now, and you can have x crops later" - that's credit.

There is nothing irrational about it at all, unless you cast aside our commonly accepted understandings of human nature and spacetime . Your 'starman' imitation lacks consistency; what you are doing is engaging in a rather complex and self deceptive form of lying

No (like all things) whether a contract is valid or not is found by actual performance.

A contract isn't a statement about the future, it is an agreement to do something in the future. The contract isn't invalid or 'incorrect' if parties do not perform certain actions mentioned in it, because the contract itself makes no assertions about what will actually happen.

You can't have a piece of paper where none of the events it describes have happened and then say it's a contract, crazy idea.

Then you can't have a contract; because you can't agree to do things in the past

[Injin]

I didn't miss it, i ignored it . You added 'with certainty' to a description of somebody evaluating the future. I have No idea why you did that as it has no bearing on any reality being described or any relevance to anything being fraud or not fraud.

Fraud or nto fraud is on/off. So is reality.

by saying your imagination about an on off state turns it into an analgoue is also a fraud. Or most probably in your case and a lot of others, the result of crap thinking, an error.

Evaluations like "i think there is a 50% chance of there being five rocks tommorow", are one of the types of evaluations involved in credit.

no, that's an evaluation about the risk of the credit, not the credit itself. if I loan you (for example) a stepladder - I might estimate you as having a 15% chance of returning it to me - but this doesn't say anything about the stepladder.

And ofc, in credit nothing is loaned, there is nothing there. No stepladder, just a naked conception, blissfully unattached to anything in reality.

You said earlier that this sort of statement is fraud....have you changed your position, now?

Can we now agree that evaluating the future is not commiting fraud?

I never said it was. I said that doing it and calling it certain was. Which means all credit is fraud because that's the entirety of what credit is about.

Nope

"John has promised me five rocks tommorow, can i have four potatos now and you collect the five rocks, later?" or "Give me fuel and tractor now, and you can have x crops later" - that's credit.

No, that's simple lending.

Credit is when you give john fuel and a tractor now because banker bill tells you he will pay you later - and john agrees to pay banker bill back if he does so. Credit requires 3 parties and is always a bo11ocks from the get go.

There is nothing irrational about it at all, unless you cast aside our commonly accepted understandings of human nature and spacetime . Your 'starman' imitation lacks consistency; what you are doing is engaging in a rather complex and self deceptive form of lying

I didn't say it was irrational. There are plenty of rational uses for irrational concepts. I just said it wasn't true.

A contract isn't a statement about the future, it is an agreement to do something in the future. The contract isn't invalid or 'incorrect' if parties do not perform certain actions mentioned in it, because the contract itself makes no assertions about what will actually happen.

An agreement to do something in the future IS a statement about the future.

Then you can't have a contract; because you can't agree to do things in the past

No, you can agree and then find out if you had a contract.

I really don't get why your sense of time is all over the place on this. What something is has to be found by measuring against real events.

Edit - Tho I can see where you are coming from if you think that credit = lending.

Edited May 4, 2010 by Injin

[Stars]

Fraud or nto fraud is on/off. So is reality.

by saying your imagination about an on off state turns it into an analgoue is also a fraud.

If i say i think a future event is less likely than another, i have not commited a fraud, i have offered an opinion.

Sorry to tangle your legs, but you really shouldn't talk such shit

no, that's an evaluation about the risk of the credit, not the credit itself. if I loan you (for example) a stepladder - I might estimate you as having a 15% chance of returning it to me - but this doesn't say anything about the stepladder.

I didn't say it was the credit, i said the evaluation may be involved in a credit arrangment..You appear to agree. The point being, the evaluation isn't fraud and you earlier claimed that it was.

The reason things have become so bizzare in the discussion is that you are calling more or less anything involved in a credit arrangment fraud in the hope of making one of them sound 'true' by word gamery. So we have idiotic concepts in the conversation, for instance all evaluation of the future is fraudulent..clearly not true, but presented by you (i imagine) to muddy and confuse communication and make nonsense less discernable

And ofc, in credit nothing is loaned, there is nothing there. No stepladder, just a naked conception, blissfully unattached to anything in reality.

In all credit arrangments, something is loaned.

I never said it was. I said that doing it and calling it certain was. Which means all credit is fraud because that's the entirety of what credit is about.

A credit arrangment isn't a factual statement about the future, doesn't involve a factual statement about the future and doesn't claim to be a factual statement about the future. Hopefully, that wil clear it up

No, that's simple lending.

It is also credit in it's most basic form; this is what credit reduces to when examined

Credit is when you give john fuel and a tractor now because banker bill tells you he will pay you later - and john agrees to pay banker bill back if he does so. Credit requires 3 parties and is always a bo11ocks from the get go.

Two people good, three people bad?

Ok, is this argument going to be use in addition to your idiotic "evaluating the future is fraudulent" argument, or do you now want this new argument to be the main route to your preferred conclusion?

An agreement to do something in the future IS a statement about the future.

Not in English it isn't. In English, an agreement makes no factual statement at all about what will happen, though it may infer intentions. An agreement to go on a picnic tomorrow is not the same thing as a record of tomorrow’s picnic and doesn’t claim to be.

Your argument doesn't seems rise much above the level of a word game