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Jerk
11/26/2008, 07:59 PM
I was wrong about Obama being the American version of Che. He appears to be more like Clinton II, minus the Blowjobs. I doubt we will see a moral fu**-up like this from Obama because his wife looks like he could beat his a.ss. He's smart, and right-wing people such as myself shouldn't under-estimate him, as if we already didn't. I think he learned the lesson from the blood-bath of 1994 and won't go hard left, for now. He'll throw a bone now and then to the hippies to keep them happy. I believe that his desire to steer this nation to the hard left will be subtle; in the form of judicial nominees, and he will pick his legislative battles wisely and chose to fight when he knows he can win. To sum it up, I expect a new version of Clinton who won't have a weaknees for young women wearing mini-skirts who can suck a golf-ball through a garden hose.

How could you blame me for thinking that he would be an american Che? The guy started his political career in William Aires' house and has associated himself with many far left nefarious dudes.

I think Obama's biggest problem will come from the masses who voted him in on high expectations. Peggy from Florida will be very upset when she realizes that there's no such thing as a "Yes We Can" mortgage payment coupon.

On the economy, this is more of a question: What is a debt-based monetary system? Is it like we're basing the value of our money on outstanding fixed-rate mortgages? If somehow inflation went sky-high (hyper-inflation) then wouldn't people with fixed-rate notes be able to pay off their debts rather easily? Well, I guess you wouldn't want stag-flation. I really don't understand this econ stuff... I think the .gov should just send all of these banks their own printing press.

Vaevictis
11/26/2008, 08:33 PM
How could you blame me for thinking that he would be an american Che? The guy started his political career in William Aires' house and has associated himself with many far left nefarious dudes.

Dude came out of Chicago. It's like faulting a politician in the old Soviet Union for having been a member of the communist party -- did he really have other options?

This is where I tell you I told you so ;)


On the economy, this is more of a question: What is a debt-based monetary system? Is it like we're basing the value of our money on outstanding fixed-rate mortgages?

Well, for one, the term is a perjorative, so I bet I can guess which sites you've been reading recently. ;)

The more typical term is 'fractional reserve.' What this refers to is the power of banks to create money through a combination of debt and deposits.

Abstract all of the "banks" in the world that accept dollar denominated deposits into one "banking system." Assume that across the system, the typical reserve rate is 10%. What this means is that for every $100 in deposits, the bank must keep $10 on hand ("in reserve").

The bank is free to lend out the remaining $90. The person who receives the loan spends the $90, and the person who receives it deposits it. The bank must keep $9 of this deposit, and may lend out the remaining $81. The money gets redeposited, and the bank must now keep $8.10, and may lend out the remaining.

This continues happening until there are a total of $100 of deposits and $1000 in loans. Essentially, the banks have created $900 additional dollars through the system.


If somehow inflation went sky-high (hyper-inflation) then wouldn't people with fixed-rate notes be able to pay off their debts rather easily?

Yes, and in fact, this is one of the reasons why governments under heavy debt burdens tend to create hyper-inflation. When your debt is denominated in your own currency, you can effectively reduce your debt by printing money and devaluing your currency.

In short, inflation helps debtors and hurts creditors. Reasonable inflation also helps businesses, as it allows them to reduce the "price" of sticky prices -- like wages. It's harder to give someone a pay cut than to not give them a raise... even though in an inflationary environment, a pay cut is essentially what's happening.

The inverse is why debtors and businesses tend to dislike deflation. It increases the value of debt, hurting people who owe money... and in the case of businesses, what they sell tends to decrease in price faster than their wages -- which obviously hurts.

Frozen Sooner
11/26/2008, 08:36 PM
Good explanation of the money multiplier effect there, Vaevictus. Kudos.

Jerk
11/26/2008, 08:41 PM
Well, it's still early, but so far I'm relieved; not that I am a liberal and wanted a liberal President, but I expected something worse, like a revolutionary.

Thanks for the reply, Vaev.

Jerk
11/26/2008, 08:43 PM
Good explanation of the money multiplier effect there, Vaevictus. Kudos.

It is interesting to me that money can be created out of thin-air.

Vaevictis
11/26/2008, 08:44 PM
Fair enough, it is still early. I just think Obama is smart enough not to turn hard left out of the gate -- and that assumes he wants to, and I'm not sure he really does.

Vaevictis
11/26/2008, 08:47 PM
It is interesting to me that money can be created out of thin-air.

Unless you're doing an asset backed currency, I'm pretty sure that's what you're always doing.

(And bluntly, the experience in the Great Depression tells you that you really, really don't want an asset backed currency.)

Frozen Sooner
11/26/2008, 08:55 PM
It is interesting to me that money can be created out of thin-air.

How else would it be created?

Any currency is created out of thin air, even those backed by an asset.

Jerk
11/26/2008, 08:56 PM
Fair enough, it is still early. I just think Obama is smart enough not to turn hard left out of the gate -- and that assumes he wants to, and I'm not sure he really does.

I'll give him a fair chance. I'm a right-wing libertarian who currently has no home because my party chickened out long ago when they got into a fight with Clinton on the issue of base-line budgeting, and lost. Because they had no balls. I have foolishly stuck with them as they spent our way into oblivion because they've always seemed better than the alternative. Now, I'm not sure who to support. If you vote for any of the basterds, all you do is encourage them.

Why is the concept of 'small and limited government' so unappealing to the masses?

Jerk
11/26/2008, 08:59 PM
How else would it be created?

Any currency is created out of thin air, even those backed by an asset.

Error. I don't compute. If the money is backed by an asset, how can it be from thin-air?

Jerk
11/26/2008, 09:00 PM
I have one more question:

Is it considered "cheating" to use control + Z whilst playing spider solitaire?

Vaevictis
11/26/2008, 09:07 PM
Why is the concept of 'small and limited government' so unappealing to the masses?

Because the masses aren't ideologically bound to small and limited government like some folks are. Likewise, they aren't ideologically bound to large interventionist government like some folks are.

What they are ideologically bound to is a society that puts them in the best position to have the best life they possibly can.

What ends up happening is that the masses perceive that the government is getting in their way -- so they clamor for deregulation. Well, deregulation leads to greedy corporate interests sucking up all the wealth... which gets in the way of the masses, and so they clamor for more regulation.

It's an endless cycle. Government and private interests are always looking out for themselves, and when one gets too powerful, 'the masses' will turn to the other to balance things out.

In my opinion, that's the way things work. And yes, it really is that simple.

Frozen Sooner
11/26/2008, 09:07 PM
Error. I don't compute. If the money is backed by an asset, how can it be from thin-air?

Because even when backed by an asset you're 1) assigning an arbitrary value to an asset and 2) creating a shared fiction in the market that a piece of paper is equivalent to some quantity of that asset.

To further expound on point one:

Say you back your currency with gold. Handy store of value, gold. People like it. It's pretty, and it has industrial uses. However, some people may not actually wish to take gold in trade. Some people may have no actual use for gold. However, since gold has been decreed to be of value, people will accept notes that puport to be backed by gold knowing that they can exchange those notes for other goods that they do actually value.

How's that different from what we do now? In both cases, you have a central government saying "That there note's gonna be worth something."

Jerk
11/26/2008, 09:09 PM
Because even when backed by an asset you're 1) assigning an arbitrary value to an asset and 2) creating a shared fiction in the market that a piece of paper is equivalent to some quantity of that asset.

To further expound on point one:

Say you back your currency with gold. Handy store of value, gold. People like it. It's pretty, and it has industrial uses. However, some people may not actually wish to take gold in trade. Some people may have no actual use for gold. However, since gold has been decreed to be of value, people will accept notes that puport to be backed by gold knowing that they can exchange those notes for other goods that they do actually value.

How's that different from what we do now? In both cases, you have a central government saying "That there note's gonna be worth something."

Ok, I get it now. Thanks.

Jerk
11/26/2008, 09:13 PM
Because the masses aren't ideologically bound to small and limited government like some folks are. Likewise, they aren't ideologically bound to large interventionist government like some folks are.

What they are ideologically bound to is a society that puts them in the best position to have the best life they possibly can.

What ends up happening is that the masses perceive that the government is getting in their way -- so they clamor for deregulation. Well, deregulation leads to greedy corporate interests sucking up all the wealth... which gets in the way of the masses, and so they clamor for more regulation.

It's an endless cycle. Government and private interests are always looking out for themselves, and when one gets too powerful, 'the masses' will turn to the other to balance things out.

In my opinion, that's the way things work. And yes, it really is that simple.

In a better world, we would have capitalism without corporations. Just a bunch of mom and pop stores who specialise. It would be like small town America, before Wal-Mart. The only way to go back to that, would be to use the power of government, which would then negate the purpose of the free market. Oh well.

I am more right wing than Atilla the Hun, but I HATE corporations.

Vaevictis
11/26/2008, 09:20 PM
Corporations aren't the only vehicle. Large proprietorships can just as easily fill that role... or guilds.

It doesn't matter what the organizational structure. Rich people will always seek more wealth, and because they're rich, they'll get it.

... right up until the masses do something about it. I don't know about you, but in terms of a mechanism effecting that, I personally prefer voting and income/estate taxes to the Reign of Terror.

StoopTroup
11/26/2008, 11:26 PM
Vaevictis....

I noticed that Citibank sent me an offer to start a Savings account this week. I thought it was kind of strange considering they and the others like them usually are either trying to sell Credit Card Protection or some sort of intro offer. When I saw that it wasn't either...I actually took time to read it and then realized what they were trying to get me to sign up for.

I'm guessing your statement on them having cash deposits is why they are doing this...thus allowing them to loosen up the offers for loans?

Frozen Sooner
11/26/2008, 11:50 PM
Vaevictis....

I noticed that Citibank sent me an offer to start a Savings account this week. I thought it was kind of strange considering they and the others like them usually are either trying to sell Credit Card Protection or some sort of intro offer. When I saw that it wasn't either...I actually took time to read it and then realized what they were trying to get me to sign up for.

I'm guessing your statement on them having cash deposits is why they are doing this...thus allowing them to loosen up the offers for loans?

In a nutshell, yes.

StoopTroup
11/27/2008, 12:21 AM
In a nutshell, yes.

I figured something was up.

I also know about them forgiving some educational loans for some students who were trying to learn to fly helicopters from a private company that went bankrupt this year.

I don't know what the amount was but I'm guessing the cost of recovery vs ligation would have just wasted time and money tying up resources leading to Citi not helping move forward in recovery.

I'm guessing the students have the luck of some good timing on their side too but who knows...it might have just been the right thing to do and they would have never recovered the dough anyway. Bad loans are Bad loans. Putting people in bankruptcy because of the misdealing of poorly managed companies doesn't probably help anything right now.

Rogue
11/27/2008, 07:30 AM
Wow.

Rogue
11/27/2008, 07:38 AM
Jerk, you feeling OK?
Lemme make sure I didn't take a wrong turn somewhere and that I understand this thread.

Jerk is very conservative AND hates corporations. I get it now that you say you're more Libertarian than Republican.

Jerk seems not just relieved, but satisfied with the notion that BO is more like Clinton than Jerk thought before. See, this is where I really thought BO was all along and where I thought Jerk took exception. Clintonomics were great for the time and I hope they are as useful now, but I'm not sure.

Am I reading too much into the point above? What is Jerk's take on another Clintonesque administration? See, other than blowjob-gate, I thought it was a great run for our country. And I'm not one to judge him about that. I expected him to lie about it, but I expected him to lie to his wife and not to the TeeVee camera. I expected him to just dodge the camera.

I hope we don't get 4-8 years of witch hunting like we did during the Clinton years.

What I'll never follow is the stuff Vaevictis and Froz seem to understand...the backwards pretzel-logic of economics. I had a macro prof at OU...guy was an alcoholic (and I swear Bipolar) genius in his 40s who still lived with his Mom. He tried to teach me. I tried to learn. We ended up agreeing that it was like trying to fill a burlap sack with water...wasn't gonna work, but perhaps the sack could absorb enough water to be wrung out at some point and have a small glass full.

Rogue
11/27/2008, 07:44 AM
Heading off to see what CTRL + Z does in spider solitaire.

Jerk
11/27/2008, 08:54 AM
Clinton lucked out by being a President in between the Cold War and the WoT. He didn't have to face a million red tanks on the boarder with Western Europe and he didn't have to respond to the WTC being destroyed, along with 3,000 Americans.

I think he got into office when the economy was in a recession and went into the Whitehouse as it began to recover. I can't tell you what Clinton did for the economy, but I will say that he didn't stand in it's way too much. As a partisan redneck I will also point out that the Republicans took the legislature in 1994 and together they did a lot of good (because back then "Republican" really meant something), like balancing the budget, welfare reform, certain state's rights, etc. We did well under split government (thread summary).

The AWB p.ssed me off and it would have only been the beginning had he kept control of Congress. He also appointed judges slightly right of Hugo Chavez, like that midget woman ACLU lawyer who voted that you do not have a constitutional right to own a gun for self defense in your own home.

As far as the scandals, I'm much more concerned with what may have happened with the selling of sensitive satellite / rocket technology to China than I am skirtgate.

Yes, I'm saying that if BHO is "another Clinton," then that's not bad. All I knew about him a month ago is that he was from Chicago who spent a lifetime hanging out with communist thugs, so yeah...I'll be relieved if he is just another Clinton.

Rogue
11/27/2008, 10:47 AM
OK, just relieved. That makes sense.
Welfare reform was pushed and signed by Bill C.

On the whole, I'm on the record as saying I wanted to see one party with power in Congress and the White House. Until one did. Now, I look back at the eras of prosperity and realize that the checks and balances between Congress and the POTUS are the best. As liberal as I am on most issues, I've been cured. I don't think the Dems will fare any better than the Pubs having their way in all areas.

Rogue
11/27/2008, 10:48 AM
Oh, and I hear now that "Priority Group 8" veterans, IOW those with income and insurance, will probably be enrolled in VA Healthcare again. VA is a decent model for gubmint run healthcare. Well, this "new VA" is anyhow.

Frozen Sooner
11/27/2008, 01:38 PM
Jerk, you feeling OK?
Lemme make sure I didn't take a wrong turn somewhere and that I understand this thread.

Jerk is very conservative AND hates corporations. I get it now that you say you're more Libertarian than Republican.

Jerk seems not just relieved, but satisfied with the notion that BO is more like Clinton than Jerk thought before. See, this is where I really thought BO was all along and where I thought Jerk took exception. Clintonomics were great for the time and I hope they are as useful now, but I'm not sure.

Am I reading too much into the point above? What is Jerk's take on another Clintonesque administration? See, other than blowjob-gate, I thought it was a great run for our country. And I'm not one to judge him about that. I expected him to lie about it, but I expected him to lie to his wife and not to the TeeVee camera. I expected him to just dodge the camera.

I hope we don't get 4-8 years of witch hunting like we did during the Clinton years.

What I'll never follow is the stuff Vaevictis and Froz seem to understand...the backwards pretzel-logic of economics. I had a macro prof at OU...guy was an alcoholic (and I swear Bipolar) genius in his 40s who still lived with his Mom. He tried to teach me. I tried to learn. We ended up agreeing that it was like trying to fill a burlap sack with water...wasn't gonna work, but perhaps the sack could absorb enough water to be wrung out at some point and have a small glass full.

Heh. That wasn't Shaun Ledgerwood, was it? I don't think he's quite in his 40s yet, but I can see how the rest would apply to him, possibly. Certainly the drinking and the genius part.

lexsooner
11/27/2008, 01:50 PM
I'll give him a fair chance. I'm a right-wing libertarian who currently has no home because my party chickened out long ago when they got into a fight with Clinton on the issue of base-line budgeting, and lost. Because they had no balls. I have foolishly stuck with them as they spent our way into oblivion because they've always seemed better than the alternative. Now, I'm not sure who to support. If you vote for any of the basterds, all you do is encourage them.

Why is the concept of 'small and limited government' so unappealing to the masses?

First of all, spek for giving objective analyses of Obama and how it appears he will govern. I give proper credit to anyone who rises above pure partisanship.

Second, to answer the last paragraph above, people want to have their cake and eat it too. The concept of limited government is appealing until you want something from the government or get taxed or get stopped in a road block or have your personal information looked over by the feds. Still, we want Daddy Sugar close by in case we need something, govt. services, a government contract or loan or entitlement, whatever. Maybe we are too nervous about the latter to favor limited government. And I think followers of both major parties are guilty of this attitude.

Rogue
11/27/2008, 01:56 PM
Heh. That wasn't Shaun Ledgerwood, was it? I don't think he's quite in his 40s yet, but I can see how the rest would apply to him, possibly. Certainly the drinking and the genius part.

I think that may have been him. Wild dark brownish hair, wore a trenchcoat or something. Chain-smoked during breaks. This woulda been 96-7 ish. Surely he was in his mid-late 30s by then?

Frozen Sooner
11/27/2008, 02:04 PM
Nope. Believe it or not, he was in his mid-late 20s if I recall. By that time he already had his JD from UT and was working on his PhD at OU.

Like I said, genius. I had him for Econ Capstone that year. Had him for Price Theory a couple years before that.

He's in some think-tank in Arlington, VA now.

Guy was also my favorite professor. Never got an A in his class, but dang it, you learned a ton of stuff. My personal fave was when he broke out Lagrange multipliers in Price Theory-in front of a bunch of people who'd at most taken Business Calc II.

Rogue
11/27/2008, 02:16 PM
Yeah, that was his name now that I've thought about it for a minute and, yes, he had a JD too so now I know that's him.

He was like a mad scientist. Glad to know his's in a think tank...one of those d00ds that was so smart I worried about him going to the dark side, LOL.

Funny the profs I learned the most from I didn't get A's in their classes. Other one was a Botany/Biology prof that moved to Nebraska...Estes. Ledgerwood was a good teacher, I just didn't get the backflips of logic involved in macro, but I learned a bunch about econ theory and history.

Rogue
11/27/2008, 02:27 PM
"I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs." - Thomas Jefferson