Jump to content
House Price Crash Forum

Recommended Posts

another nutter gets it

link

Do you ever get the feeling that you are in some kind of weird dream, where someone is holding a pillow over your face so that you can't breathe, and you can dimly hear your children asking, "Is he dead yet, mom?" and I am thrashing around and yelling out, "No, I'm not dead, you morons!" but nobody is paying attention? Me, too!

And I get the same feeling watching the collapse of the economic system, as was always confidently predicted by the Austrian Business Cycle Theory and proudly on display at Mises.org, as my head is spinning, spinning, spinning around with wild conspiracy theories to try, desperately, to explain how a country that has so many colleges and universities, and which have graduated so many self-important alumni, for so long, has allowed this to happen!

And, as cold comfort as it is, it's not just us. Everybody, in every country, is in the same boat, a nice little yacht made of promises and paper instead of fiberglass and steel, now being tossed and battered by an angry sea of losses and bankruptcy instead of water and waves, which, if you have ever made a paper boat out of a sheet of paper and put it in the water, always results in disaster when it gets soggy and ends up as a wet, useless, misshapen lump of soggy paper, ending your dreams of building a paper boat big enough to hold you so that you could just sail away to someplace where you could stay up as late as you wanted, and you could eat cookies and cake for breakfast if you wanted, anytime you like, and you didn't have to listen to anybody tell you that Keynesian economics is not the piece of crap that it is, or that the Federal Reserve is not the treacherous, traitorous, ruination-by-inflation piece of crap that IT is.

Extending the metaphor (since I seem to be on somewhat of a roll), it is the euro that is in the part of the paper boat that is sinking fastest, although The Economist magazine is ever-optimistic, and says that "the euro's decline, in contrast, should bolster exports for big manufacturers (particularly in northern Europe) and luxury goods companies while boosting tourism across the continent" which makes me wonder where in the hell people are getting the money to go on a European vacation and buy luxury goods, because there is nobody around here like that.

Share this post


Link to post
Share on other sites

another nutter gets it

link

There are many heads in the sand at present. Pointing at improving numbers on the surface, derived from borrowed and printed money is a route to collapse. They all say, 'we can manage our debts' until one day the market will not play the game. Spain is the last participant in this farce. The markets are awaiting the 22nd June to see what they think of the Coalition plan. Cut too much and the fear of double dip will cause problems. Don't cut enough and they will not be taken seriously. Very difficult to be right when your deficit is so large that any meaningful cut will cause long term economic pain and lower living standards, not to mention downward presssure on the housing market.

Share this post


Link to post
Share on other sites

....They all say, 'we can manage our debts' until one day the market will not play the game.....

True. Slowly but surely the banks are stealing everything. Only a few more years to go now and they will own the very country itself.

Share this post


Link to post
Share on other sites

Keynesianism seems a lot like communism to me in that it might sound an OK theory, but is grossly naive about human nature in practice.

Politicians simply dont build up surpluses in the good times to cover the bad times, and even if they did, the voters would likely flock to Liebour, or some other party offering something for 'nothing'

Fact is, most people are irresponsible, I guess Keynes couldnt see this. Or maybe people were different back then.,

Share this post


Link to post
Share on other sites

Thick as p1gsh1t here - who is 'the market'? How come they've got money to lend? I'm not being entirely serious, but I genuinely don't quite understand how this market can lend back to us something they don't have - our future wealth - and have it mean anything. What is it we're borrowing, and why is it useful if it doesn't exist yet?

Share this post


Link to post
Share on other sites

Keynesianism seems a lot like communism to me in that it might sound an OK theory, but is grossly naive about human nature in practice.

Politicians simply dont build up surpluses in the good times to cover the bad times, and even if they did, the voters would likely flock to Liebour, or some other party offering something for 'nothing'

Fact is, most people are irresponsible, I guess Keynes couldnt see this. Or maybe people were different back then.,

If they're not building up the surpluses then they're not being Keynesian, so the issue is moot.

Keynes must've been able to see it. Saving for a rainy day is responsible common sense IMO. The fact that he considered it worth saying suggests that he saw what people are really like.

Share this post


Link to post
Share on other sites

another nutter gets it

link

The left is not really Keynesian. The man advocated for counter cyclical government budgeting: SAVING in good times, and then spending it in bad times. The left only remembers Keynes when the bad times arrives. :rolleyes: That is no Keynesianism. That is just opportunism, ignorance and short-sightedness, as it fecks with countries economies in the long term. And the poor suffers the most. What a left... :angry:

Share this post


Link to post
Share on other sites

The left is not really Keynesian. The man advocated for counter cyclical government budgeting: SAVING in good times, and then spending it in bad times. The left only remembers Keynes when the bad times arrives. :rolleyes: That is no Keynesianism. That is just opportunism, ignorance and short-sightedness, as it fecks with countries economies in the long term. And the poor suffers the most. What a left... :angry:

where do the savings come from

Share this post


Link to post
Share on other sites

The left is not really Keynesian. The man advocated for counter cyclical government budgeting: SAVING in good times, and then spending it in bad times. The left only remembers Keynes when the bad times arrives. :rolleyes: That is no Keynesianism. That is just opportunism, ignorance and short-sightedness, as it fecks with countries economies in the long term. And the poor suffers the most. What a left... :angry:

I too am wondering where the Keynesians are. Last government in this country borrowed and spent in the boom.

Share this post


Link to post
Share on other sites

Very interestingly I read in another thread on here today, a poster's view that the Keynesian thing to do would have been to limit LTV's to say 60% during the boom and after we hit dificulties, extend it to 75 percent. To allow a bit more borrowing to stimulate the economy in the bad times, and keeping a cap on it in the good times.

Share this post


Link to post
Share on other sites

Very interestingly I read in another thread on here today, a poster's view that the Keynesian thing to do would have been to limit LTV's to say 60% during the boom and after we hit dificulties, extend it to 75 percent. To allow a bit more borrowing to stimulate the economy in the bad times, and keeping a cap on it in the good times.

That was me, I think.

Keynsianism says you should tighten financial regulation during boom times and loosen them in a recession.

Also, public spending should be cut back during the boom times and increased during recessions.

Not only will this provide a counter-cyclical boost but also will get you better value for money. e.g Labor for capital projects will be a lot cheaper.

This is the exact opposite of what has happened.

A lot of people here don't know what Keynsianism means.

Share this post


Link to post
Share on other sites

Very interestingly I read in another thread on here today, a poster's view that the Keynesian thing to do would have been to limit LTV's to say 60% during the boom and after we hit dificulties, extend it to 75 percent. To allow a bit more borrowing to stimulate the economy in the bad times, and keeping a cap on it in the good times.

Yes, I saw that too. it was by "Barry", here:

Pity we didn't have Keynsians in charge for the last few decades.

They'd now be increasing the LTV from a low value held throughout the boom years to give the economy a counter-cyclical boost.

BTW not blaming the current lot for doing this or that it's the wrong thing to do it now. They've been dealt a raw hand by the previous idiots.

But he didn't suggested specific limits though. I think that 60-75 %s is too low. I would probably go from a 80 to 95 %s. For FTBs a deposit of 15% in always hard to save, even in good times, and 5% in a recession is not that easy either.

BTW, all this talk of LTV are only relevant for FTBs. People with equities usually have that.

Share this post


Link to post
Share on other sites

That was me, I think.

Keynsianism says you should tighten financial regulation during boom times and loosen them in a recession.

Also, public spending should be cut back during the boom times and increased during recessions.

Not only will this provide a counter-cyclical boost but also will get you better value for money. e.g Labor for capital projects will be a lot cheaper.

This is the exact opposite of what has happened.

There you are.

A lot of people here don't know what Keynsianism means.

Yep. I blame the BBC - the b@stards.

.

Edited by Tired of Waiting

Share this post


Link to post
Share on other sites
But let goods be homespun whenever it is reasonably and conveniently possible, and, above all, let finance be primarily national

reminds me of the candlemakers

link

You are on the right track. You reject abstract theories and have little regard for abundance and low prices. You concern yourselves mainly with the fate of the producer. You wish to free him from foreign competition, that is, to reserve the domestic market for domestic industry.

We come to offer you a wonderful opportunity for your — what shall we call it? Your theory? No, nothing is more deceptive than theory. Your doctrine? Your system? Your principle? But you dislike doctrines, you have a horror of systems, as for principles, you deny that there are any in political economy; therefore we shall call it your practice — your practice without theory and without principle.

We are suffering from the ruinous competition of a rival who apparently works under conditions so far superior to our own for the production of light that he is flooding the domestic market with it at an incredibly low price; for the moment he appears, our sales cease, all the consumers turn to him, and a branch of French industry whose ramifications are innumerable is all at once reduced to complete stagnation. This rival, which is none other than the sun, is waging war on us so mercilessly we suspect he is being stirred up against us by perfidious Albion (excellent diplomacy nowadays!), particularly because he has for that haughty island a respect that he does not show for us [1].

We ask you to be so good as to pass a law requiring the closing of all windows, dormers, skylights, inside and outside shutters, curtains, casements, bull's-eyes, deadlights, and blinds — in short, all openings, holes, chinks, and fissures through which the light of the sun is wont to enter houses, to the detriment of the fair industries with which, we are proud to say, we have endowed the country, a country that cannot, without betraying ingratitude, abandon us today to so unequal a combat.

Be good enough, honourable deputies, to take our request seriously, and do not reject it without at least hearing the reasons that we have to advance in its support.

First, if you shut off as much as possible all access to natural light, and thereby create a need for artificial light, what industry in France will not ultimately be encouraged?

and why should finance be national

but he was right sometimes

"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, government 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. – 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."

and

Markets can remain irrational longer than you can remain solvent

Should government refrain from regulation and taxation, the worthlessness of the money becomes apparent and the fraud can no longer be concealed

struggling for many more though

Share this post


Link to post
Share on other sites

Exactly. Most people attacking that man have no idea how thoughtful he actually was. They are typically attacking the idea of 'Keynesianism' not actual things he said.

One of the things that troubled him most was global imbalances which is at the root of our problems (not money printing nor frb).

I posted this elsewhere about how his ideas on international trade altered during the course of his life:

Keynes marvelling at the pre War (One) international trade (this cannot be separated from the Empire of course):

Keynes changing his mind about free trade in 1933:

That first line rings so true...the English free trade mantra is drummed into you from a very early age and only later may you actually stand back and question it.

http://www.businessi...ClusterStock%29

"As lately as 1923 I was writing that free trade was based on fundamental "truths"

(...)

But to-day at last, one-third of the way through the twentieth century (...)"

So he wrote that in the 1930s. Google 1930s protectionism, and see where it ended up.

Besides being and economist, Keynes was also part of the British elite of the day, inclined to defend the British Empire and its trading privileges. France was also happy with the colonial system. Both countries together controlled more than half of the planet. America (the industrialised east coast) didn't care much about it, as it was a continent in itself. But the newly industrialised countries - Germany, Japan and Italy - wanted free trade. But their requests were ignored, and the rest... is history, unfortunately.

BTW, America came to help, but with one big condition: free trade. WTO and all that, at Bretton Woods, 1944.

BTW 2: A few years later Britain tested the waters a bit, in 1956, at Suez...

C'mon hotairmail, today even Russia and China "make trade not war". "Give trade a chance". :)

Share this post


Link to post
Share on other sites

The left is not really Keynesian. The man advocated for counter cyclical government budgeting: SAVING in good times, and then spending it in bad times. The left only remembers Keynes when the bad times arrives. :rolleyes: That is no Keynesianism. That is just opportunism, ignorance and short-sightedness, as it fecks with countries economies in the long term. And the poor suffers the most. What a left... :angry:

Technically, the government never needs to balance the books - it just needs the budget deficit (in %) to be lower then economic growth in the good times and greater in recessions to balance overall - i.e. same % of GDP.

Share this post


Link to post
Share on other sites

So he wrote that in the 1930s. Google 1930s protectionism, and see where it ended up.

Besides being and economist, Keynes was also part of the British elite of the day, inclined to defend the British Empire and its trading privileges. France was also happy with the colonial system. Both countries together controlled more than half of the planet. America (the industrialised east coast) didn't care much about it, as it was a continent in itself. But the newly industrialised countries - Germany, Japan and Italy - wanted free trade. But their requests were ignored, and the rest... is history, unfortunately.

BTW, America came to help, but with one big condition: free trade. WTO and all that, at Bretton Woods, 1944.

BTW 2: A few years later Britain tested the waters a bit, in 1956, at Suez...

C'mon hotairmail, today even Russia and China "make trade not war". "Give trade a chance". :)

C'mon, even you must have noticed China peg their currency, or perhaps that eludes you too.

Shame the so-called 'free traders' :lol: favour protectionism so long as it fits their own personal prejudices.

Edited by Red Karma

Share this post


Link to post
Share on other sites

I am not for war. I am not jingoistic. But I do recognise we need to do something to protect our fellow citizens and stop the nonsense of today's mercantilist battles that others are fighting us with.

get the regulators/taxes out of the way and let people compete without being tied up

and lets sort out the bankers at the same time

Share this post


Link to post
Share on other sites

Keynesianism per se is not the problem.........

because Keynesian economics involves borrowing during a downturn to stimulate the economy......and running surpluses in the good years to even things out....

Prior to Keynes governments had always slashed spending during slumps to try and keep a balanced budget.......

The problem now is that Brown's government was running deficits in the good years because of his absurd spending.....meaning during a downturn the deficit would run out of control

..

Share this post


Link to post
Share on other sites

get the regulators/taxes out of the way and let people compete without being tied up

and lets sort out the bankers at the same time

China competes. Unfortunately their workers kill themselves as a result.

You really think the 'rich' are going to feed, educate and heal you? Any evidence they'll do this? They never have in the past (with a few exceptions notable for being exceptions but only once they were already rich eyond their wildest avarice).

Slavery doesn't work - it's been tried remember.

Your Somalian utopia really isn't the solution. At least not one I'd favour.

Share this post


Link to post
Share on other sites

China competes. Unfortunately their workers kill themselves as a result.

You really think the 'rich' are going to feed, educate and heal you? Any evidence they'll do this? They never have in the past (with a few exceptions notable for being exceptions but only once they were already rich eyond their wildest avarice).

Slavery doesn't work - it's been tried remember.

Your Somalian utopia really isn't the solution. At least not one I'd favour.

i dont expect anyone to feed educate and heal me - do you

slavery is what we have now - the state and bankers controlling the slaves

Share this post


Link to post
Share on other sites

Very interestingly I read in another thread on here today, a poster's view that the Keynesian thing to do would have been to limit LTV's to say 60% during the boom and after we hit dificulties, extend it to 75 percent. To allow a bit more borrowing to stimulate the economy in the bad times, and keeping a cap on it in the good times.

Ah, the fabled 'taking away the punch bowl when the party gets too rowdy'. The problem is, no political party wants to kill off the golden goose.

While it's a good idea in principle, I have no faith in politicians doing it.

Besides, if we didn't have a centrally planned financial system and massive government borrowing, there wouldn't be half the problems anyway; credit bubbles can only get so large, when you don't have some central bank sending the wrong signals out.

BTW, was it Keynes who came up with the idea of inflation targeting with interest rates or is that another person's idea? (EDIT: Just googled and it was) Maybe this is another idea of his which has been butchered, but trying to track exponential growth of 2% seems like a recipe for disaster. With 0%, I can at least understand the concept, but 2%? Where is this inflation to come from, if it isn't ultimately from the printers? You can't borrow more and more indefinitely.

EDIT2: It seems to me that economics has been made far more complex and distorted than it need be, by people like Keynes and other control freaks. The idea that a few clever men can make better decisions than millions, seems entirely flawed.

Edited by Traktion

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 259 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.