tag:blogger.com,1999:blog-7820485130017459619.post6749211166327658976..comments2023-10-24T01:46:47.151-07:00Comments on CynicusEconomicus: The UK Economy - A ReviewUnknownnoreply@blogger.comBlogger25125tag:blogger.com,1999:blog-7820485130017459619.post-38500132247196523512011-10-18T02:25:23.346-07:002011-10-18T02:25:23.346-07:00I think Andy CFC doesn't understand MMT either...I think Andy CFC doesn't understand MMT either! - because if he did, he would realise it is only part, and a small part at that, of the explanation of the global economy.<br /><br />MMT seems to be about trying to justify Government spending and essentially a 'large' state and trying to get people to believe that this is a benevolent process and should be trusted by the 'private' sector. <br /><br />Politically, I think this naive at best. Economically, is is too simplistic to make any sense of the global economy.<br /><br />Believe it if you like Andy CFC, but it doesn't seem to do the trick for me.Yorkienoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-445791073419106692011-10-08T09:15:02.140-07:002011-10-08T09:15:02.140-07:00There appears to be a growing group of people in t...There appears to be a growing group of people in the UK and the US who want to limit or stop the practice of fractional reserve banking. New money would not therefore be created as debt by the banks but simply by the central banks of each country. When created it would be passed directly to the treasury to be spent on the upkeep of national infrastructure, so reducing taxes. <br /><br />for a more in depth discussion please see http://prosperityuk.com/ <br />or <br />http://www.positivemoney.org.uk/ <br /><br />As I've not seen this challenged anywhere what would be the effect of this policy on the UK. Certainly I believe the positive money proposals would result in intrinsically safe banking. Can anyone counter these proposals??Dusty09noreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-11362204774797162102011-10-02T04:48:17.798-07:002011-10-02T04:48:17.798-07:00I would be interested to discover the age of the M...I would be interested to discover the age of the MMT enthusiasts. Because for anyone who can remember the 1970s their blythe assumptions that the all knowing State can simply print its way to prosperity, and then (at precisely the right point) remove the stimulus via the tax system in time to prevent runaway inflation are innocent in the extreme. <br /><br />People thought in the 60s and early 70s that they could fine tune the economy - a bit more demand here, and bit less here, and produce the perfect sweet spot of full employment and low inflation. Alas reality proved otherwise.<br /><br />The interactions of billions of people, buying and selling, are not predictable by the human mind, or even the electronic one, as the electronic one can only compute using human information and guidelines. The idea you can control an economy of millions of people by pulling on policy levers is very naive and extremely dangerous.Jimnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-68385353154410638102011-09-24T13:59:48.312-07:002011-09-24T13:59:48.312-07:00Please, ease up on any personal and insulting lang...Please, ease up on any personal and insulting language. One of the good points in the blog is that the tone of argument is largely good natured.Markhttps://www.blogger.com/profile/14983165364072918091noreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-58576719094436010802011-09-24T12:28:12.230-07:002011-09-24T12:28:12.230-07:00Andy CFC,
I have read all your posts and found no...Andy CFC,<br /><br />I have read all your posts and found no sense only nonsense.<br /><br />I have read Chris Cook on Alphaville and like you he spouts nonsense.<br /><br />Prag Cap is into MMT and he at least try's to make some sense.<br /><br />At the end of the day it comes down to whether you believe Financial Repression will work or we'll get Monetary Implosion.<br /><br />I'm going for MI, which is nicely summed up by Jens O Parsson:<br /><br />"Everyone loves an early inflation. The effects at the beginning of inflation are all good. There is steepened money expansion, rising government spending, increased government deficits, booming stock markets, and spectacular general prosperity, all in the midst of temporarily stable prices. Everyone benefits, and no one pays. That is the early part of the cycle. In the later inflation, on the other hand, the effects are all bad. The government may steadily increase the money inflation in order to stave off the latter effects, but the latter effects patiently wait. In the terminal inflation, there is faltering prosperity, tightness of money, falling stock markets, rising taxes, still larger government deficits, and still roaring money expansion, now accompanied by soaring prices, and an ineffectiveness of all traditional remedies. Everyone pays and no one benefits. That is the full cycle of every inflation."<br /><br />=====<br /><br />In my opinon:<br /><br />THE UK<br /><br />1997 to 2007 - early inflation.<br /><br />2007 to 20?? - later inflation.<br /><br />20?? to 20?? - terminal inflation.<br /><br />Yours<br /><br />Death to Bubble AddictsAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-86549477676937728032011-09-23T23:02:23.406-07:002011-09-23T23:02:23.406-07:00Andy cfc,
Are you paid by the word for obfuscatio...Andy cfc,<br /><br />Are you paid by the word for obfuscation or are you a moron?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-18186634300390739582011-09-23T16:34:05.147-07:002011-09-23T16:34:05.147-07:00Bertie
im not going to argue about Steve Keen from...Bertie<br />im not going to argue about Steve Keen from i admit little ive read its about too much private debt and hes right so dont understand yr point...if you think i think there isnt enough private debt yr nuts<br />this blog is mainly from what ive read about public "debt"Andy CFCnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-55486746655029891612011-09-23T16:06:56.522-07:002011-09-23T16:06:56.522-07:00ok Bertie
dont care if you buy it or not...its a d...ok Bertie<br />dont care if you buy it or not...its a description of a fiat system... whats yrs?<br />and i think i asked you how you were comparing a gold standard type system in the Euro to a Fiat system that we have.... and? <br /><br />so the BOE base rate is 0% is it? last time i looked its 0.5% but hey whats 0.5% difference eh...subtle i know but what makes you think MMT believes in ZIRP rates, <br /><br />so which Inflation index are you choosing? personally thought it was outreagous that the last government took housing out of it... the largest component and it was taken out..wtf?<br />lets put it back in...bet that 4% will drop somewhat..... oil price as well tanked today which is another major part of that inflation figure... <br />QE has caused a liquidity trap granted... i dont argue for QE i argue for fiscal stimulas not monetary... that was to keep the banks afloat<br /><br /><br />where will be in 10 years...dont know depends who wins the argument, the austrians or the MMTs... at the moment its the austrians and looks whats happening, austerity is taking the whole world down... congratsAndy CFCnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-17599684394094879092011-09-23T15:47:27.565-07:002011-09-23T15:47:27.565-07:00lastly mark because of this comment
"My timin...lastly mark because of this comment<br />"My timing is poor, but the problems nevertheless just keep oozing out of the cracks. Look back further into the blog, as I grappled with the questions, and see how much is now accepted in the 'mainstream'."<br /> <br />now that its accepted into the "mainstream" whats happening is we are now heading for depression because you refuse to believe the monetary system hasnt changed to a totally fiat system (ignore the eurozone..alhough the ECB could sort it but they refuse)<br />right wing governments are being voted in all over the place because of right wing rethoric like this that on the face of it sounds right but has no grounding in reality of the system<br /><br />enjoy yr depression youve earnt itAndy CFCnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-83156690228651215562011-09-23T14:39:44.414-07:002011-09-23T14:39:44.414-07:00anyway Mark, now ive gone on and on so sorry to bo...anyway Mark, now ive gone on and on so sorry to bore everyone time to answer yr original question<br /><br />whats gones wrong, policy makers etc etc<br /><br />can answer that all in 1 sentence<br /><br />They dont understand how modern money worksAndy CFCnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-59693317522933717002011-09-23T13:45:40.524-07:002011-09-23T13:45:40.524-07:00ctnd again
In conclusion i dont think youve taken...ctnd again<br /><br />In conclusion i dont think youve taken account of the fact we are not on the gold standard anymore and comparing the UK/US at times to the eurozone just doesnt work, you certainly can compare the eurozone to household spending though...personally think the germans are nuts dont they realise their economy will go down with it or do they realise the euro will tank and that helps their exports (intrestingly not all their exports ex the EU are manufactured in Germany, i know of an american pharma co, where the goods are manufactured in Ireland and UK which are then sent to Germany who then export ex the EU... the UK arm send approx a million pounds worth a couple of times a week to Germany)be careful what you read into trade figures all is not what it seems...in that case its showing an intra EU trade but Germany an ex EU trade<br /><br />finally things change, systems change, understanding changes...if yesterday someone had said to me things can travel faster than the speed of light would have thought they were barking, since 1971 when the US come off the gold standard the system whether you like or not has changed (yes i know the UK come off in the 30,s but as the US didnt until 71 we were all stuck with it due the US being the reserve currency)Andy CFCnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-18775606777518323942011-09-23T13:29:07.360-07:002011-09-23T13:29:07.360-07:00Anon (Neil Wilson?)
I just don't buy MMT, in ...Anon (Neil Wilson?)<br /><br />I just don't buy MMT, in that I don't buy economics as a discipline. It functions as a post-hoc form of rationalisation of political choices rather than as any kind of reliable predictor. As for modern economists, I just about (with reservations) accept some of Steve Keen's work, but I think even he places too much trust in his models.<br /><br />So, I have made some predictions - inflation will be maintained at 4-5% over the next 10 years (unless an emergency requires greater inflation) via the mechanism of currency devaluation, and the base rate will be kept at 0%. I know there's an argument that QE is actually deflationary, in that interest-bearing bonds are exchanged for cash, but that ignores the fact that the recipients of QE will leverage said cash at many times its nominal value.<br /><br />So, if you disagree with my assessment, please don't bother attempting to do so with a blizzard of theory, and state your own preditions as to how the crisis will be dealt with, and where we can expect ourselves to be in 5-10 years. Neutral readers can then take on board our predictions, and make their own assessment going forwards.Bertienoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-13085636202365539532011-09-23T13:21:25.212-07:002011-09-23T13:21:25.212-07:00contd
Your use of the word government "borro...contd<br /><br />Your use of the word government "borrowing" is disingenius at best, if the government doesnt spend how can it tax? a bond market now is a monetary exercise it isnt a fiscal financing operation<br />We are now in the situation where the private sector is starting to delverege (quite rightly) we have a current account deficit, so if the government stop spending where is money going to come from if they do, it will trash the economy, and i will use the example of Greece they are stuck in basically a gold standardesq system <br />Now i do work in international trade (im a freight fowarder) so for instance the chinese (actually business is starting to go elsewhere to other cheaper countries who are quite happy to get the biz, Vietnam for instance, massive change in the percentage of imports we get from there from 5 years ago) are quite happy to accept our paper for their services, what are they going to do insist on gold.. oh wait bang export economy down the toilet and change of government 10 mins later bet they would scare the leaders to death (although i do take yr point from an earlier piece that a war would take the ppls minds off it)<br />The fact i do work as a freight fowarder and in intl trade was the nagging thought that sent me elsewhere and that was the cigarette lighter problem .... couple of things you fistly have this lighter manufactured but thats where you start, no raw materials, shipping raw materials in this case oil for the plastic casing, the machinery that drills for oil which surprisngly to you maybe a lot of which is manufactured here..i know we send loads of it <br />you said you didnt think shipping added value... i can tell you that i reckon shipping is a lot more expensive than you think, you probably just concentrate on the freight rate if you checked but actually the charges either side of the actual freighting are more expensive.... i can move by air from London to Shanghai at 0.15 per kg, but your final bill for everything else is going to come to at least 2.00 per kg... shanghai to london then treble that<br />btw got 3 chuckaway lighters at a market a couple of weeks ago for 0.35! mind you one didnt work...manufactured in Vietnam<br /><br />now to what you say here about governments spinning plates...no i dont agree and these problems are seeming to stem from the Eurozone not the UK or US and what is the difference between us and the Eurozone...simple they are in effect a gold standard economy<br />China is an intresting case as well we thought we had a credit bubble...have you looked at theirs with their demographics?<br />What the governments of currency sovereign nations dont get is what they can do they still work under gold standard thinking and that is why i think we have the mess we do <br /><br /><br /><br />Im going to go now to a newspaper that you like to quote from (which i admit i read as well) the daily telegraph<br />you have quoted Liam Halligan... christ does he not have a clue<br />Jeremy Warner.. cant quite make up my mind on him, i dont know whether its politcal or he is just a dinosaur<br />now Ambrose Pritchard Evans is intresting love reading his stuff.... personally think hes an MMTr but is trying to hide it, why i think hes trying to hide it is because it doesnt quite go with the political agenda of the DT... dont tell me it doesnt have an agenda because its obvious it does, the guardian does as well quite obviously the other way<br />cant find it now but there was also a bond trader in the DT who did a piece and he said "simply the national debt is a total of the deficits" wtf? i cant believe a bond trader would be so ignorant so im going to put it down to scare mongering or a politcal agenda<br /><br /><br />zerohedge... as some wit commented on at FTalphaville (which i love btw) the other day... said "what do people still read that?"<br />if you can, try to catch some of Chris cooks comments on it, great stuffAndy CFCnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-14614561964351669142011-09-23T13:20:18.876-07:002011-09-23T13:20:18.876-07:00Mark thanks for taking the time to reply and yes s...Mark thanks for taking the time to reply and yes sorry did post as anonymous when i posted a link to MMT earlier and how modern money works my only excuse is fat fingers,noticed someone else say elsewhere here that its a theory but they are wrong its a misnomer its a description of how modern money works and when you read through then its yes thats right (as far as im concerned and lots more ppl are coming around to it)<br /><br />I actually was being honest when i thanked you as i said for opening my eyes, I dont agree now with a lot of what you say now but it was you that started me reading about economics because i didnt get it but seems i went off in a different direction to you, i went MMT <br /><br />much earlier in your blog you for instance you used an example where an 18th century aristocrat was giving out IOUs and yes at the time i was yes thats right and i agree with you.... but when i realised that we are in a totally FIAT system your example to todays money doesnt make sense, said aristo isnt the monopoly supplier of currencyAndy CFCnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-41356185391285529242011-09-23T03:02:22.986-07:002011-09-23T03:02:22.986-07:00Andy, what link? Have you posted anonymously befor...Andy, what link? Have you posted anonymously before?<br /><br />As for the comment on the 2011, downfall - well, how has it worked. The policy has kept the plates spinning, with ever more absurd measures, but the fundamental problems I noted - still there...<br /><br />Or do you argue with that point. Have the policy makers really 'fixed' the world economy, or did they just delay? <br /><br />My timing is poor, but the problems nevertheless just keep oozing out of the cracks. Look back further into the blog, as I grappled with the questions, and see how much is now accepted in the 'mainstream'. <br /><br />Make a substantive comment on how we got where we are now, and perhaps (time allowing) I will answer. I will quote you:<br /><br />"Anyway now its 2011 lets have a look at cynicus predictions... apparently 2009 was the downfall of the west... im sorry did i miss it, oh wait nope nothing has changed... did he get it wrong then, must have but why? "<br /><br />I got it wrong, because I simply thought that others would see what I saw, and I had not imagined the extreme and long term damaging actions of governments to try to keep the plates spinning. But now we are seeing the price of keeping the plates spinning - a bigger crisis. <br /><br />I am unable to predict the absurd lengths to which policy makers might resort, but I can see that there are fundamental problems. Take the Euro, for example... I argued against it, as it lacked political foundations and fiscal integration, but we now look at the price. Yep, they kept that plate spinning for a long while but, in the end, the absurdity emerges. <br /><br />Your comments identify only one point; enough political will, and we can delay. We can dress up pigs' ears as pearls. Look underneath, and the picture changes. As much as we would all like the pigs ears to be pearls, a pig's ear is a pig's ear. <br /><br />As time moves forwars, how many pearls now look like pig ears? I will leave this comment on that point.....Markhttps://www.blogger.com/profile/14983165364072918091noreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-29990479988267099062011-09-23T02:51:35.977-07:002011-09-23T02:51:35.977-07:00Question for Anonymous:
If someone presents thems...Question for Anonymous:<br /><br />If someone presents themselves as being unable to spell and use basic grammar correctly, how can other people be expected to believe that person has a sufficient grasp of classical economics in order to be able to debunk it?Jonnyhttps://www.blogger.com/profile/16119442844302447926noreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-7566479161592398892011-09-22T14:52:34.093-07:002011-09-22T14:52:34.093-07:00Anyway now its 2011 lets have a look at cynicus pr...Anyway now its 2011 lets have a look at cynicus predictions... apparently 2009 was the downfall of the west... im sorry did i miss it, oh wait nope nothing has changed... did he get it wrong then, must have but why?Andy CFCnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-47852306610467418102011-09-22T14:27:04.934-07:002011-09-22T14:27:04.934-07:00did you read the link? did you understand how it w...did you read the link? did you understand how it works... so im waiting for you to tell me whats wrong with it, if you didnt get it my post above was also me<br />I have no political ideology that blinds me.. I suggest cynicus reading matter does<br />lets see the Times, the daily telegraph, Zerohedge etc etc he did forget the daily mail so i think we know where hes coming from (ok sorry cheap shot there on the daily mail)... when i mentioned text books tbh i knew the answer.. the wealth of nations isnt it.. 1776 that was published..hey a 250 year old economics textbook well that must be right then, <br /><br /><br />I have been a bit unfair i admit, this was the first economics blog I read and made a lot of sense as I, like a lot I expect only had household spending to compare it to and at that time of my understanding quite rightly equated it too the same. I thought public debt was the same but something didnt seem right to me so I carried on reading elsewhere and for that I do have cynicus to thank, its certainly opened my eyes alas for a lot here its blinded you to an Austrian perspective that isnt reality as the gold standard is defunct.Andy CFCnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-50410413769918168912011-09-22T00:22:28.594-07:002011-09-22T00:22:28.594-07:00I feel much more enlightened having read 'patr...I feel much more enlightened having read 'patronising' Anonymous's nine line exposition. If only she had presented this analysis at the outset of Cynicus's project all those years ago, I would not have wasted so much of my precious time! <br /><br />Such are her pearls of wisdom, I'll wager she is a member of the Bank of England's MPC.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-51542089713932179872011-09-21T15:21:52.536-07:002011-09-21T15:21:52.536-07:00Bertie
how can you compare the UK a currency sover...Bertie<br />how can you compare the UK a currency sovereign government to the EU who arnt? simples you cant<br /><br />and what is the national debt? go on explain to me? and if you start comparing it to a household debt suggest you look again<br />In the UKs case its the amount outstanding on gilts (in the US its T-bills) suggest reading my link to find out how the bond market works instead of worrying about some imaginary bond vigilante! <br /><br /><br />And QE the rest of you have no clue...printing money? nope fail, im afraid look again <br /><br />hey chaps we arnt on a gold standard anymore... you need to understand that... sorry to sound patronising but thats how it isAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-62240405225770956132011-09-21T14:58:07.486-07:002011-09-21T14:58:07.486-07:00sigh
very poor modern economics...alas the net is...sigh <br />very poor modern economics...alas the net is full of it... ppl reading 60 year old text books<br />this is how money works<br />http://pragcap.com/resources/understanding-modern-monetary-systemAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-41909503071785140912011-09-18T13:21:38.887-07:002011-09-18T13:21:38.887-07:00Thought you might like to see this article:
http:/...Thought you might like to see this article:<br />http://www.spectator.co.uk/essays/all/7238833/this-is-going-to-hurt.thtml<br />It follows very much the same narrative you have been expounding for ages, except that it omits your point about Basel accords distorting risk judgements.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-25117761090528388012011-09-18T11:56:53.143-07:002011-09-18T11:56:53.143-07:00I think the 4-5% inflation rate is deliberate, and...I think the 4-5% inflation rate is deliberate, and the result of an attempt to devalue the currency by a similar annual percentage rate. Basically, 5% devaluation will halve the national debt over 12 years. It's a number high enough to erode debt without leading to a sense of out-of-control panic.<br /><br />Interest rates will be held at 0% by the BoE for the next 5 to 10 years, with the MPC meetings essentially acting as Kabuki theatre, until they are eventually edged off the news agenda as 0% becomes normalised. <br /><br />Welfare etc. will be cut following the example of other European countries who are in more difficulty - again it will become "normalised" over the EU area to remove benefits, and less of a stigma to individual governments.<br /><br />So basically, expect a creeping erosion of living standards across the EU and UK. What matters to the politicians is not that the decline is arrested, but that it is slow enough for the process to be accepted as a succession of new normals.Bertienoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-51308438682860999432011-09-17T05:17:05.969-07:002011-09-17T05:17:05.969-07:00I'm very glad to have found this blog. You see...I'm very glad to have found this blog. You seem to support TWOP's view on QE - I would have thought anyone who has a rudimentary knowledge of economics would know it's just the electronic version of printing money and throwing it into the air.<br />TWOP is not a political party, but we are trying to raise money to create one which will bring about True Democracy in Great Britain - see our website for more details, or mail me at twopforum@live.co.uk. <br />I wonder if you would be interested in supporting us? We're not after donations - although if you have large quantities of it going spare we won't say no - but we do ask for support via Easysearch.org.uk and Easyfundraising.org.uk.<br />By the way, our website is a bit tired and the 'innovative scrolling' area (as it has been described) is mostly irritating. We're currently working on reissuing it as a Wordpress site and will let you know when this is ready, if you wish. Meanwhile, if you would like any other information about TWOP please email us.<br />Congratulations on your blog. You're right about the need for reform; we think True Democracy is the only way it will every happen.David Georgehttp://www.twopforum.webs.comnoreply@blogger.comtag:blogger.com,1999:blog-7820485130017459619.post-66237720885095957332011-09-16T04:30:13.619-07:002011-09-16T04:30:13.619-07:00superb analysissuperb analysisdasvnoreply@blogger.com