Curt Doolittle

Theme: Subsidy

  • QUALITATIVE EASING : INSURING ARTIFICIAL PRICE LEVELS CAUSED BY STATE MONETARY P

    http://blogs.wsj.com/economics/2013/12/19/how-to-stop-financial-panics-say-hello-to-qualitative-easingCONTRA QUALITATIVE EASING : INSURING ARTIFICIAL PRICE LEVELS CAUSED BY STATE MONETARY POLICY

    (un-libertarian) (recession insurance) (PSST) (insuring against busts)

    This solution in the paper that is referred to in the article is weaker than simply buying down debt on real property from consumers and SMB’s that do not have access to capital markets,in sectors of the economy undergoing crashes. Further, buying down debt by fiat allows the state to penalize lenders by paying them off at a discount, by fiat. This is a better incentive than regulation of inputs. Because consumers are protected by the state and lenders are harmed in terms profits but not balance sheets.

    Reasons are multiple, but mostly, that the preservation of false price levels is distortionary, while the redistribution of discounted debt restores balance sheets. And specific sectors can be addressed quickly, which reduces downward pressure on prices.

    In effect, by this method, the state insures large asset prices against booms and busts.

    I recommended this solution in 2008, and Galbraith did as well, before he died.

    And the longer I have worked on the problem the more certain I am that it is a MUCH MORE effective policy than either government spending or lowering interest rates. Neither of which help the PSST (pattern of sustainable specialization and trade) within a given sector.

    Prices are information. We can insure the quality of information. And this method insures that bottom end of the asset price even if all profit is wiped from the transaction.

    This puts cash in people’s pockets within a collapsing sector without allowing the repricing in that sector to easily spread to the broader economy.

    Imagine if every home owner had received a formulaic payment against his or her home’s debt, and contributions to 401K’s for any balance over their debt amount. This would rapidly have put cash in everyone’s hands, while adjusting balance sheets, and would have stopped the fear of prices falling.

    I’ve written enough about this. But the point is, libertarian or not, just or not, insuring state induced prices is the most effective technique for controlling the spread of relative price changes as they percolate through the economy and cause disruptions in additional patterns of sustainable specialization and trade.

    Cheers.

    Source date (UTC): 2013-12-20 03:09:00 UTC

  • WHY DID ICELAND DO IT RIGHT? A CRITIQUE OF CORPORATISM VS CAPITALISM Because cap

    WHY DID ICELAND DO IT RIGHT? A CRITIQUE OF CORPORATISM VS CAPITALISM

    Because capitalism requires, and is defined by, the fact that risk takers both win and lose, and they bear the burdens of both their wins and losses.

    There is nothing in capitalism that supports the privatizing of social gains, or the socialization of private losses. That isn’t CAPITALISM. That’s state CORPORATISM. The alliance between the state and the capitalists, AGAINST the general population.

    Without the counter-incentive of risk, only totalitarianism of rules and regulations can attempt to control natural human behavior to socialize risk and privatize reward. That is what free riding and rent seeking do.

    The purpose of competition in the market is to reward consumers by way of a competition between lenders, producers, distributors, and vendors. Whenever a competition exists, at least one party loses, but that is never the consumer – who always benefits. This is the most elegant form of redistribution ever created by man. It is a virtuous cycle.

    But if the state INSURES COMPETITORS, it breaks the virtuous cycle, and provides incentives for competitors to privatize gains, and to socialize losses.

    When you create debt of any kind, you are not in the clear with the profits until the debt is paid off. That is, you have earned only the right to USE the income from that debt, but it is not YOURS until the debt is paid off.

    This is counter to human loss aversion instincts. In our emotional machinery between our ears, we own what we have. But that is not true, and cannot be. A debt and corresponding credit function as a production cycle. The good is not MADE until it is paid off.

    Our legal system does not recognize this liability and that is why we fail to correctly adjudicate credit and debt, and why we fail to correctly implement policy to protect consumers and hold lenders accountable.

    The reason is quite simple: the state is trying to put credit out there all the time in every way possible so that it creates employment and taxes from employment.

    But the production cycles are lost in a sea of confusion and this immeasurable distortion in information is inconceivably complex, and impossible for economists to tease from the data.

    The left’s proposition is that ‘it will all work out’. The right’s proposition is that we are undermining the entire SCIENTIFIC nature of the anglo model of economy we call capitalism.

    Source date (UTC): 2013-12-15 07:55:00 UTC

  • DID IT RIGHT. And they keep doing it right. Fry bankers. Socialize the mortgages

    http://rt.com/op-edge/iceland-bank-sentence-model-246/ICELAND DID IT RIGHT.

    And they keep doing it right. Fry bankers. Socialize the mortgages. Burn the investors. I”m a capitalist. These guys are corrupt.

    Source date (UTC): 2013-12-14 19:17:00 UTC

  • BUDGET OFFICE: Top……40% Paid 106.2% of Income Taxes; Bottom 40% Paid -9.1%..

    http://cnsnews.com/news/article/terence-p-jeffrey/cbotop-40-paid-1062-income-taxes-bottom-40-paid-91-got-average-18950CONGRESSIONAL BUDGET OFFICE:

    Top……40% Paid 106.2% of Income Taxes;

    Bottom 40% Paid -9.1%…

    AND……Got an average of $18,950 in ‘Transfers’

    Of course, my preference is that we just GAVE THEM CASH rather than ‘transfers’. And it’s their preference too I assume.

    Source date (UTC): 2013-12-09 17:59:00 UTC

  • SAID THE SAME THING. SO DID GALBRAITH BEFORE HE DIED. In the US case, 200K per m

    http://rt.com/news/iceland-debt-relief-measure-535/I SAID THE SAME THING. SO DID GALBRAITH BEFORE HE DIED.

    In the US case, 200K per mortgage, would have kept the world pricing system intact. As it was, the entire world had to reorganize production to adjust to new signals. And as far as I can tell, for no good reason. Instead of buying down homeowner debt with federal debt and forcing lenders to take drastic penalties. We destroyed the wealth of generations, and impoverished them.

    My estimate was 2-4T. And that was CHEAP by comparison.

    Source date (UTC): 2013-12-02 04:50:00 UTC

  • Eliminating the Corporation Insured by the State

    (Sketch) Eliminate the state sponsored corporation. A corporation is a partnership whose members are insured by a monopoly insurer insulated from competition: the state. All associations are, and only can be, partnerships. Restore right of suit for any and all involuntary transfers, outside of morally sanctioned competition, against any and all individuals within the partnership and their agents. Require insurance bonds be purchased by the partnership. Require all employees be bonded if they communicate with or act on behalf of, customers. (The incentives will favor truth telling and allocate money and status to truth-tellers.) Stock certificates shall not represent ownership, but a purchase of contractual rights to dividends that are guaranteed by the assets in the event of liquidation or sale. Control then shall not be democratic, but contractual.

  • The value of direct redistribution is (a) that the proletariat will greedily sta

    The value of direct redistribution is (a) that the proletariat will greedily starve the state, and (b) they will have money to spend to create demand. (c) if they are shareholders, and the market is a corporation, then they have standing to directly sue any individual, public or private within that market.

    It’s mandatory for us to transform political discourse from ‘morality’ to ‘voluntary transfers’ and property rights. Because only voluntary transfers are moral, and only the operational visibility of voluntary transfers allows scientific analysis of the voluntary and involuntary transfers.

    We must maintain that competition is intuitively an competition that is immoral to many, however, the outcome is virtuous – particularly if all competition can be pressed into the market.

    Source date (UTC): 2013-11-19 04:22:00 UTC

  • THE WHOLE THING WAS AN INCREMENTALIST CHARADE all we had to do was give people c

    http://mises.org/daily/6587/The-Economics-of-ObamaCareIT THE WHOLE THING WAS AN INCREMENTALIST CHARADE

    all we had to do was give people catastrophic insurance.

    Source date (UTC): 2013-11-14 08:05:00 UTC

  • HELPING OTHERS WITH OTHER PEOPLE’S MONEY…. … is just a cheap way to demonstr

    HELPING OTHERS WITH OTHER PEOPLE’S MONEY….

    … is just a cheap way to demonstrate conspicuous consumption because of your wealth. It’s Status seeking. It’s selfish. If you want to change the world, then pay for it yourself.

    It doesnt take much. Just a little self sacrifice.

    But everyone is a wanna-be. A pretender.

    “Artificial feel-good.”

    If it doesn’t cost it doesn’t have value.

    Source date (UTC): 2013-11-10 15:03:00 UTC

  • PROGRESSIVES ARE IN DENIAL…. ….over the immorality of GROWTH via CONSUMPTION

    http://charleshughsmith.blogspot.com/2013/11/the-generational-injustice-of-social.htmlWHY PROGRESSIVES ARE IN DENIAL….

    ….over the immorality of GROWTH via CONSUMPTION and IMMIGRATION, rather than GROWTH via CONSTANT POPULATION and INVENTION.

    Because if they don’t stay buried in denial, they have to admit that their greatest ‘achievement’ of the 20th century was a catastrophic failure that destroyed the inter-GENERATIONAL system of calculation, cooperation and incentives.

    You know, there isn’t much difference between the necessity of money and prices for temporal coordination, and for the necessity of credit and interest for short inter-temporal coordination, and for the accumulation of wealth, and borrowing for long term, intergenerational coordination. These means of calculating are necessary, not arbitrary.

    FACTS

    The following are true;

    (a) consumption requires that population increases.

    (b) growth requires that innovation increases

    (c) consumption is not growth it is expansion – there is a difference.

    (d) consumption can finance growth.

    (e) the limit of consumption to finance growth is determined by the rate of invention produced by the financing of consumption.

    (There is a tidy graph defined here, but I”m not interested enough to go draw it, so I’ll leave it up to your imagination.)

    I don’t need to bring up that growth via consumption is dysgenic, and growth via invention is eugenic. We have to think about THE PLANET after all.

    I also don’t need to bring up that growth via consumption is the (mindless) female reproductive strategy that depends on regulation by nature, and that growth via invention is the (mindful) male reproductive strategy, and that this largely provides the explanation for the differences in voting behavior.

    NO FREE LUNCH

    Source date (UTC): 2013-11-10 02:31:00 UTC