The Federal Reserve has been artificially preventing inflation by loaning out at 0%-2% interest which they plan to stop doing in 2014.
Printing money holds off inflation? I think I will use this statement as a standard to calibrate my assessment of your statements by.
That's the Feds logic not mine. They think by giving discounts it will encourage investments but all it does is risk hyperinflation. To undo the damage will require interest rates as high as 15% for years on end.
Assuming "artificially preventing inflation" was not a typo, are you confusing between the interest paid on reserves and the overnight interbank rate?
“@amieparnes: At a funder in Atlanta tonite, POTUS is interrupted by a ring tone of a guest: "Oh, you've got some Luda on there?" (Referring to Ludacris)”
The Federal Reserve has been artificially preventing inflation by loaning out at 0%-2% interest which they plan to stop doing in 2014.
Printing money holds off inflation? I think I will use this statement as a standard to calibrate my assessment of your statements by.
That's the Feds logic not mine. They think by giving discounts it will encourage investments but all it does is risk hyperinflation. To undo the damage will require interest rates as high as 15% for years on end.
Assuming "artificially preventing inflation" was not a typo, are you confusing between the interest paid on reserves and the overnight interbank rate?
I misspoke, they are keeping the interest rates low to encourage spending and investments.
In a market economy, resources tend to flow to activities that provide the greatest returns for the risks the lender bears. Interest rates (adjusted for expected inflation and other risks) serve as market signals of these rates of return. Although returns will differ across industries, the economy also has a natural rate of interest that depends on factors such as the nation’s saving and investment rates. When economic activity weakens, monetary policymakers can push the interest rate target (adjusted for inflation) temporarily below the economy’s natural rate, which lowers the real cost of borrowing. To most economists, the primary benefit of low interest rates is their stimulative effect on economic activity. By reducing interest rates, the Fed can help spur business spending on capital goods—which also helps the economy’s long-term performance—and can help spur household expenditures on homes or consumer durables like automobiles. For example, home sales are generally higher when mortgage rates are 5 percent than when they are 10 percent.
A second benefit of low interest rates is improving bank balance sheets and banks’ capacity to lend. During the financial crisis, many banks, particularly some of the largest banks, were found to have too little capital, which limited their ability to make loans during the initial stages of the recovery.
By keeping short-term interest rates low, the Fed helps recapitalize the banking system by helping to raise the industry’s net interest margin (NIM), which boosts its retained earnings and, thus, its capital. Between the fourth quarter of 2008, when the FOMC reduced its federal funds target rate to virtually zero, and the first quarter of 2010, the NIM increased by 21 percent, its highest level in more than seven years. Yet, the amount of commercial and industrial loans on bank balance sheets declined by nearly 25 percent from its peak in October 2008 to June 2010. This suggests that perhaps other factors were working to restrain bank lending.
A third benefit of low interest rates is that they can raise asset prices. When the Fed increases the money supply, the public finds itself with more money balances than it wants to hold. In response, people use these excess balances to increase their purchases of goods and services and of assets like houses or corporate equities. Increased demand for these assets, all else equal, raises their price.
The lowering of interest rates to raise asset prices can be a double-edged sword. On the one hand, higher asset prices increase the wealth of households (which can boost spending) and lower the cost of financing capital purchases for business. On the other hand, low interest rates encourage borrowing and higher debt levels.
Throughout the near-century examined in detail we have found that:
1. Changes in the behavior of the money stock have been closely associated with changes in economic activity, money income, and prices.
2. The interrelation between monetary and economic change has been highly stable.
3. Monetary changes have often had an independent origin; they have not been simply a reflection of changes in economic activity.
Translated into today-speak: the secular rate of inflation was, and remains, correlated with the real level of output. Insofar as we desire real employment and real output to remain high, we would like to fight deflation.
How does lower prices cause less production and fewer jobs?
Orthodox explanation: downward nominal rigidity, especially in the short run. There is also debt overhang to consider.
e: both of these, of course, being instances of the phenomenon whereby people expect inflation to be at some level and it turns out to be at another, thus causing prices and wages to be wrong.
We have a perfectly good economy thread around somewhere and most community colleges offer reasonably price courses if you are interested.
Why be snarky? It helps to know this stuff in order to vote, and few have time to actually study it. Asking questions is a fast way to remedy ignorance of a topic.
We have a perfectly good economy thread around somewhere and most community colleges offer reasonably price courses if you are interested.
Why be snarky? It helps to know this stuff in order to vote, and few have time to actually study it. Asking questions is a fast way to remedy ignorance of a topic.
Because this is the Obama Admin thread, rather than the economy thread?
We have a perfectly good economy thread around somewhere and most community colleges offer reasonably price courses if you are interested.
Why be snarky? It helps to know this stuff in order to vote, and few have time to actually study it. Asking questions is a fast way to remedy ignorance of a topic.
Because asking "why is deflation bad?" indicates one of two things - either you are horribly uneducated/miseducated about economics, or you are not discussing the matter in good faith.
We have a perfectly good economy thread around somewhere and most community colleges offer reasonably price courses if you are interested.
Why be snarky? It helps to know this stuff in order to vote, and few have time to actually study it. Asking questions is a fast way to remedy ignorance of a topic.
Snark unintended.
He just needs to get some idea of how economics works to talk about it.
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HenroidMexican kicked from Immigration ThreadCentrism is Racism :3Registered Userregular
My favorite part was when he said "the All-of-the-Above approach." Because that's the most realistic answer to energy. We have more than one answer. We can use them all. TOGETHER.
Bills similar to this have existed for a while but has the president and his secretaries had this power before, or was it all with congress?
Yes. The powers of the government in a state of emergency is pretty widespread and always has been. Technically, every male over the age of 18 can be pressed into militia service at the drop of a hat.
Bills similar to this have existed for a while but has the president and his secretaries had this power before, or was it all with congress?
Governors have this power as well. My wife is a nurse and has been subpoenaed by the governor's office to stay at work during weather emergencies. The state then reimbursed the hospital for the staff's overtime so I'm not sure if it's exactly the same, but the sentiment is similar.
Bills similar to this have existed for a while but has the president and his secretaries had this power before, or was it all with congress?
Governors have this power as well. My wife is a nurse and has been subpoenaed by the governor's office to stay at work during weather emergencies. The state then reimbursed the hospital for the staff's overtime so I'm not sure if it's exactly the same, but the sentiment is similar.
Reading through this it seems like any seizure of resources is actually a compelled sale or a forced contract while the "labor" seizure involves specialists to be placed in executive positions or selective service drafts through the department of labor.
The areas laid out specifically are defense, energy, agriculture and transportation. And the government can make and subsidize loans in those sectors to help do this.
I don't know, all of this seems like things the federal government was already doing, just laid out in writing as policy and granting the powers directly to the secretaries in times of crisis.
He's a shy overambitious dog-catcher on the wrong side of the law. She's an orphaned psychic mercenary with the power to bend men's minds. They fight crime!
Bills similar to this have existed for a while but has the president and his secretaries had this power before, or was it all with congress?
Governors have this power as well. My wife is a nurse and has been subpoenaed by the governor's office to stay at work during weather emergencies. The state then reimbursed the hospital for the staff's overtime so I'm not sure if it's exactly the same, but the sentiment is similar.
Reading through this it seems like any seizure of resources is actually a compelled sale or a forced contract while the "labor" seizure involves specialists to be placed in executive positions or selective service drafts through the department of labor.
The areas laid out specifically are defense, energy, agriculture and transportation. And the government can make and subsidize loans in those sectors to help do this.
I don't know, all of this seems like things the federal government was already doing, just laid out in writing as policy and granting the powers directly to the secretaries in times of crisis.
Did they do anything with this when Jindal & Sanford refused bailout funds from the stimulus for their states?
The explicit and overt goal of the Fed in a low-interest-rate policy is to raise the rate of inflation, not lower it, though.
Why fight deflation?
You should really take an economics course or something
I mean really, I've only taken 3 of them but why deflation is cancerous to capitalism, and why a small amount of inflation is beneficial, was week two. I mean there's no need to, but if you don't have the basic concepts of economics under your hat you probably shouldn't be trying to convert others to your worldview.
That Obama flag thing is stupid, I wonder when the liberal media is going to start finding isolated cases of cult of personality on the right? I've heard Ron Paul fans say that liberals and neocons should be hunted down and shot, where's the story on that?
I remember people being concerned about Obama's lack of financing in his reelection bid. Yes, even though he hadn't even started to campaign yet. Like the writing was on the wall that a Romney or Santorum presidency would be Actual Things.
Now it's a month later. And Obama just spent it campaigning.
Bills similar to this have existed for a while but has the president and his secretaries had this power before, or was it all with congress?
Governors have this power as well. My wife is a nurse and has been subpoenaed by the governor's office to stay at work during weather emergencies. The state then reimbursed the hospital for the staff's overtime so I'm not sure if it's exactly the same, but the sentiment is similar.
Reading through this it seems like any seizure of resources is actually a compelled sale or a forced contract while the "labor" seizure involves specialists to be placed in executive positions or selective service drafts through the department of labor.
The areas laid out specifically are defense, energy, agriculture and transportation. And the government can make and subsidize loans in those sectors to help do this.
I don't know, all of this seems like things the federal government was already doing, just laid out in writing as policy and granting the powers directly to the secretaries in times of crisis.
Did they do anything with this when Jindal & Sanford refused bailout funds from the stimulus for their states?
No, because it remains the right of a state to accept or refuse assistance like that. While it was an economic crisis, it was not a National Emergency (tm) so there was no legal right impress anyone into service. This sort of this is for like pandemics or war or natural disasters on the scale of Katrina or Fukushima and the like.
Long story short, this isn't the Obama Government Enslavement Act, nor is it a deviation from standard practice for the last 236 years.
I remember people being concerned about Obama's lack of financing in his reelection bid. Yes, even though he hadn't even started to campaign yet. Like the writing was on the wall that a Romney or Santorum presidency would be Actual Things.
Now it's a month later. And Obama just spent it campaigning.
That's a lot of money! To help visualize this, imagine you have a dollar. Now multiply that 300 million times!
Thank you, House Republican effort to kill the ACA that backfired hilariously. This wouldn't have been possible without you!
That's been a pretty normal month for him. While everyone's been focused on the asshat brigade, his fundraising has been plugging along and his pretty silly. Which is important because he's not going to quite have the same level of SuperPAC support.
Self-righteousness is incompatible with coalition building.
$300 million blown on advertising ... I'd rather that money went to charity or something since President Obama is already all but assured of a re-election victory against Romney.
$300 million blown on advertising ... I'd rather that money went to charity or something since President Obama is already all but assured of a re-election victory against Romney.
An gallon of prevention, I guess. Where would these excess funds go post election, I wonder.
$300 million blown on advertising ... I'd rather that money went to charity or something since President Obama is already all but assured of a re-election victory against Romney.
An gallon of prevention, I guess. Where would these excess funds go post election, I wonder.
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“@amieparnes: At a funder in Atlanta tonite, POTUS is interrupted by a ring tone of a guest: "Oh, you've got some Luda on there?" (Referring to Ludacris)”
So awesome. I want this video.
I misspoke, they are keeping the interest rates low to encourage spending and investments.
Why fight deflation?
We have a perfectly good economy thread around somewhere and most community colleges offer reasonably price courses if you are interested.
Lower prices > less production > fewer jobs > lower prices .. repeat
As per M. Friedman and A. Schwartz, in 1963:
Translated into today-speak: the secular rate of inflation was, and remains, correlated with the real level of output. Insofar as we desire real employment and real output to remain high, we would like to fight deflation.
Orthodox explanation: downward nominal rigidity, especially in the short run. There is also debt overhang to consider.
e: both of these, of course, being instances of the phenomenon whereby people expect inflation to be at some level and it turns out to be at another, thus causing prices and wages to be wrong.
e#2: a post, from [chat].
But no really, I love him when he gets on things like this. Definitely my kind of president.
Why be snarky? It helps to know this stuff in order to vote, and few have time to actually study it. Asking questions is a fast way to remedy ignorance of a topic.
Because this is the Obama Admin thread, rather than the economy thread?
And there is, indeed, an economy thread.
Because asking "why is deflation bad?" indicates one of two things - either you are horribly uneducated/miseducated about economics, or you are not discussing the matter in good faith.
And he's going to put up for vote an end to the oil subsidies... This man really wants to continue being president
Are you saying he is stealing Romney's platform?
He said this today?! *bisonYESYES*
If this was in response to me, I was being 100% sincere up there.
Snark unintended.
He just needs to get some idea of how economics works to talk about it.
I left a pro-Obama comment somewhere in it and I managed to not have someone breathe down my back over it. It's a new record!
Bills similar to this have existed for a while but has the president and his secretaries had this power before, or was it all with congress?
Yes. The powers of the government in a state of emergency is pretty widespread and always has been. Technically, every male over the age of 18 can be pressed into militia service at the drop of a hat.
?
An example of some of the responses typical at the time amongst the far right.
Governors have this power as well. My wife is a nurse and has been subpoenaed by the governor's office to stay at work during weather emergencies. The state then reimbursed the hospital for the staff's overtime so I'm not sure if it's exactly the same, but the sentiment is similar.
Reading through this it seems like any seizure of resources is actually a compelled sale or a forced contract while the "labor" seizure involves specialists to be placed in executive positions or selective service drafts through the department of labor.
The areas laid out specifically are defense, energy, agriculture and transportation. And the government can make and subsidize loans in those sectors to help do this.
I don't know, all of this seems like things the federal government was already doing, just laid out in writing as policy and granting the powers directly to the secretaries in times of crisis.
Did they do anything with this when Jindal & Sanford refused bailout funds from the stimulus for their states?
You should really take an economics course or something
I mean really, I've only taken 3 of them but why deflation is cancerous to capitalism, and why a small amount of inflation is beneficial, was week two. I mean there's no need to, but if you don't have the basic concepts of economics under your hat you probably shouldn't be trying to convert others to your worldview.
That Obama flag thing is stupid, I wonder when the liberal media is going to start finding isolated cases of cult of personality on the right? I've heard Ron Paul fans say that liberals and neocons should be hunted down and shot, where's the story on that?
Now it's a month later. And Obama just spent it campaigning.
So what are the results?
President Obama raised $45 million in February, growing his war chest to $300 million+ and getting larger by the day.
That's a lot of money! To help visualize this, imagine you have a dollar. Now multiply that 300 million times!
Thank you, House Republican effort to kill the ACA that backfired hilariously. This wouldn't have been possible without you!
No, because it remains the right of a state to accept or refuse assistance like that. While it was an economic crisis, it was not a National Emergency (tm) so there was no legal right impress anyone into service. This sort of this is for like pandemics or war or natural disasters on the scale of Katrina or Fukushima and the like.
Long story short, this isn't the Obama Government Enslavement Act, nor is it a deviation from standard practice for the last 236 years.
That's been a pretty normal month for him. While everyone's been focused on the asshat brigade, his fundraising has been plugging along and his pretty silly. Which is important because he's not going to quite have the same level of SuperPAC support.
An gallon of prevention, I guess. Where would these excess funds go post election, I wonder.
Don't they generally go to the DNC, or something?