|
Read the rules in the OP before posting, please.In order to ensure that this thread continues to meet TL standards and follows the proper guidelines, we will be enforcing the rules in the OP more strictly. Be sure to give them a re-read to refresh your memory! The vast majority of you are contributing in a healthy way, keep it up! NOTE: When providing a source, explain why you feel it is relevant and what purpose it adds to the discussion if it's not obvious. Also take note that unsubstantiated tweets/posts meant only to rekindle old arguments can result in a mod action. |
Cash-starved legislators are seeing dollar signs in dime bags — with talk that a tax on marijuana could pump hundreds of millions or even billions into budgets still reeling from the recession.
“I’ve seen some estimates in the high tens of millions, as much as $100 million for [Colorado],” said Rep. Jared Polis (D-Colo.), who’s pushing a federal legalization in Congress. Money like that could make a big difference, he said — including a “substantial dent in needed school improvements, particularly in poorer districts.”
It’s long been a central argument of the pro-marijuana crowd: Get marijuana out of the hands of dope dealers, tax it like you do cigarettes, then sit back and watch the money pour in.
“We all know where the money from nonmedical marijuana sales is currently going,” said a narrator in a Colorado campaign ad from last year, nodding to Mexico. "It doesn't need to be that way. If we pass Amendment 64, Colorado businesses would profit, and tax revenues would pay for public services and the reconstruction of our schools."
Source
|
2012 attempt not the "Underwear bomber"
A would-be "underwear bomber" involved in a plot to attack a US-based jet was in fact working as an undercover informer with Saudi intelligence and the CIA, it has emerged.
The revelation is the latest twist in an increasingly bizarre story about the disruption of an apparent attempt by al-Qaida to strike at a high-profile American target using a sophisticated device hidden in the clothing of an attacker.
The plot, which the White House said on Monday had involved the seizing of an underwear bomb by authorities in the Middle East sometime in the last 10 days, had caused alarm throughout the US.
It has also been linked to a suspected US drone strike in Yemen where two Yemeni members of al-Qaida were killed by a missile attack on their car on Sunday, one of them a senior militant, Fahd Mohammed Ahmed al-Quso.
But the news that the individual at the heart of the bomb plot was in fact an informer for US intelligence is likely to raise just as many questions as it answers.
Citing US and Yemeni officials, Associated Press reported that the unnamed informant was working under cover for the Saudis and the CIA when he was given the bomb, which was of a new non-metallic type aimed at getting past airport security.
The informant then turned the device over to his handlers and has left Yemen, the officials told the news agency. The LA Times, which first broke the news that the plot had been a "sting operation", said that the bomb plan had also provided the intelligence leads that allowed the strike on Quso.
Source
|
I expect a Middle Eastern-themed "The Departed" take on the whole thing to come about shortly.
|
On March 30 2013 07:01 {CC}StealthBlue wrote:Show nested quote +Cash-starved legislators are seeing dollar signs in dime bags — with talk that a tax on marijuana could pump hundreds of millions or even billions into budgets still reeling from the recession.
“I’ve seen some estimates in the high tens of millions, as much as $100 million for [Colorado],” said Rep. Jared Polis (D-Colo.), who’s pushing a federal legalization in Congress. Money like that could make a big difference, he said — including a “substantial dent in needed school improvements, particularly in poorer districts.”
It’s long been a central argument of the pro-marijuana crowd: Get marijuana out of the hands of dope dealers, tax it like you do cigarettes, then sit back and watch the money pour in.
“We all know where the money from nonmedical marijuana sales is currently going,” said a narrator in a Colorado campaign ad from last year, nodding to Mexico. "It doesn't need to be that way. If we pass Amendment 64, Colorado businesses would profit, and tax revenues would pay for public services and the reconstruction of our schools." Source
Exactly why I think it's only a matter of time.. anywhere there is a buck to be made, you can be sure it will become legal. I'd be happy to just see it decriminalized myself.
|
The Price Is Wrong
But which price — that is the question.
It’s a slow morning on the economic news front, as we wait for various euro shoes to drop, so I thought I’d share a meditation I’ve been having on the diagnosis and misdiagnosis of the Lesser Depression. It’s not really different from what I’ve been saying all along, but maybe coming at it from a different angle is somewhat enlightening.
So, start with our big problem, which is mass unemployment. Basic supply and demand analysis says that things like that aren’t supposed to happen: prices are supposed to rise or fall to clear markets. So what’s with this apparent massive and persistent excess supply of labor?
In general, market disequilibrium is a sign of prices out of whack; and most people commenting on our mess accept the notion that one or more prices are for some reason not adjusting. The big divide comes over the question of which price is wrong.
As I see it, the whole structural/classical/Austrian/supply-side/whatever side of this debate basically believes that the problem lies in the labor market. (I know, the Austrians will deny it — but it doesn’t matter what you say about their position, any comprehensible statement leads to angry claims that you don’t understand their depths). For some reason, they would argue, wages are too high given the demand for labor. Some of them accept the notion that it’s because of downward nominal wage rigidity; more, I think, believe that workers are being encouraged to hold out for unsustainable wages by moocher-friendly programs like food stamps, unemployment benefits, disability insurance, and whatever.
As regular readers know, I find this prima facie absurd — it’s essentially the claim that soup kitchens caused the Great Depression. But let’s stick with the economic logic for now.
So what’s the alternative view? It’s basically the notion that the interest rate is wrong — that given the overhang of debt and other factors depressing private demand, real interest rates would have to be deeply negative to match desired saving with desired investment at full employment. And real rates can’t go that negative because expected inflation is low and nominal rates can’t go below zero: we’re in a liquidity trap.
There are strong policy implications of these two views. If you think the problem is that wages are too high, your solution is that we need to meaner to workers — cut off their unemployment insurance, make them hungry by cutting off food stamps, so they have no alternative to do whatever it takes to get jobs, and wages fall. If you think the problem is the zero lower bound on interest rates, you think that this kind of solution wouldn’t just be cruel, it would make the economy worse, both because cutting workers’ incomes would reduce demand and because deflation would increase the burden of debt.
What my side of the debate would call for, instead, is a reduction in the real interest rate, if possible, by raising expected inflation; and failing that, more government spending to increase demand and put idle resources to work.
So how can you tell which side is right? Well, these differing views make differing predictions. If you believe that the problem is excessive wages, you believe that the economy is fundamentally suffering from a supply-side constraint. In that case government borrowing is competing with the private sector for a limited quantity of resources, so big budget deficits should lead to soaring interest rates; meanwhile, because the supply of goods is limited, large increases in the money supply should lead to soaring inflation. Oh, and cuts in government spending should, if anything, be expansionary, because they both release resources to the private sector and make life tougher for workers who try to live on public benefits.
If, on the other hand, you believe that the problem lies in a shortfall of demand due to the zero lower bound, you believe that government borrowing needn’t drive up rates, because it puts unemployed resources to work; that monetary expansion won’t be inflationary, because the money will just sit there; and that fiscal austerity will be strongly contractionary.
I leave the adjudication of these competing claims as an exercise for readers.
Oh, and one more thing: no, you can’t say “Well, there may be truth to both views”. Either the economy is supply-constrained or it’s demand-constrained. Of course even the most ardent demand-siders will admit that there are supply constraints in there somewhere, that if we had an economic boom we would, after some period of time, enter a regime where printing money is inflationary and government borrowing drive up interest rates. But not here, not now.
So yes, the price is wrong — but it’s a terrible, disastrous mistake to focus on the wrong wrong price.
Source
Slanted piece, but I feel it sums up the economic fundamentals at play right now.
|
ATLANTA — As more Republicans give in to President Barack Obama's health-care overhaul, an opposition bloc remains across the South, including from governors who lead some of the nation's poorest and unhealthiest states.
"Not in South Carolina," Gov. Nikki Haley declared at the recent Conservative Political Action Conference. "We will not expand Medicaid on President Obama's watch. We will not expand Medicaid ever."
Widening Medicaid insurance rolls, a joint federal-state program for low-income Americans, is an anchor of the law Obama signed in 2010. But states get to decide whether to take the deal, and from Virginia to Texas – a region encompassing the old Confederacy and Civil War border states – Florida's Rick Scott is the only Republican governor to endorse expansion, and he faces opposition from his GOP colleagues in the legislature. Tennessee's Bill Haslam, the Deep South's last governor to take a side, added his name to the opposition on Wednesday.
Haley offers the common explanation, saying expansion will "bust our budgets." But the policy reality is more complicated. The hospital industry and other advocacy groups continue to tell GOP governors that expansion would be a good arrangement, and there are signs that some Republicans are trying to find ways to expand insurance coverage under the law.
Haslam told Tennessee lawmakers that he'd rather use any new money to subsidize private insurance. That's actually the approach of another anchor of Obama's law: insurance exchanges where Americans can buy private policies with premium subsidies from taxpayers.
Source
|
On March 31 2013 13:18 aksfjh wrote:Show nested quote +The Price Is Wrong
But which price — that is the question.
It’s a slow morning on the economic news front, as we wait for various euro shoes to drop, so I thought I’d share a meditation I’ve been having on the diagnosis and misdiagnosis of the Lesser Depression. It’s not really different from what I’ve been saying all along, but maybe coming at it from a different angle is somewhat enlightening.
So, start with our big problem, which is mass unemployment. Basic supply and demand analysis says that things like that aren’t supposed to happen: prices are supposed to rise or fall to clear markets. So what’s with this apparent massive and persistent excess supply of labor?
In general, market disequilibrium is a sign of prices out of whack; and most people commenting on our mess accept the notion that one or more prices are for some reason not adjusting. The big divide comes over the question of which price is wrong.
As I see it, the whole structural/classical/Austrian/supply-side/whatever side of this debate basically believes that the problem lies in the labor market. (I know, the Austrians will deny it — but it doesn’t matter what you say about their position, any comprehensible statement leads to angry claims that you don’t understand their depths). For some reason, they would argue, wages are too high given the demand for labor. Some of them accept the notion that it’s because of downward nominal wage rigidity; more, I think, believe that workers are being encouraged to hold out for unsustainable wages by moocher-friendly programs like food stamps, unemployment benefits, disability insurance, and whatever.
As regular readers know, I find this prima facie absurd — it’s essentially the claim that soup kitchens caused the Great Depression. But let’s stick with the economic logic for now.
So what’s the alternative view? It’s basically the notion that the interest rate is wrong — that given the overhang of debt and other factors depressing private demand, real interest rates would have to be deeply negative to match desired saving with desired investment at full employment. And real rates can’t go that negative because expected inflation is low and nominal rates can’t go below zero: we’re in a liquidity trap.
There are strong policy implications of these two views. If you think the problem is that wages are too high, your solution is that we need to meaner to workers — cut off their unemployment insurance, make them hungry by cutting off food stamps, so they have no alternative to do whatever it takes to get jobs, and wages fall. If you think the problem is the zero lower bound on interest rates, you think that this kind of solution wouldn’t just be cruel, it would make the economy worse, both because cutting workers’ incomes would reduce demand and because deflation would increase the burden of debt.
What my side of the debate would call for, instead, is a reduction in the real interest rate, if possible, by raising expected inflation; and failing that, more government spending to increase demand and put idle resources to work.
So how can you tell which side is right? Well, these differing views make differing predictions. If you believe that the problem is excessive wages, you believe that the economy is fundamentally suffering from a supply-side constraint. In that case government borrowing is competing with the private sector for a limited quantity of resources, so big budget deficits should lead to soaring interest rates; meanwhile, because the supply of goods is limited, large increases in the money supply should lead to soaring inflation. Oh, and cuts in government spending should, if anything, be expansionary, because they both release resources to the private sector and make life tougher for workers who try to live on public benefits.
If, on the other hand, you believe that the problem lies in a shortfall of demand due to the zero lower bound, you believe that government borrowing needn’t drive up rates, because it puts unemployed resources to work; that monetary expansion won’t be inflationary, because the money will just sit there; and that fiscal austerity will be strongly contractionary.
I leave the adjudication of these competing claims as an exercise for readers.
Oh, and one more thing: no, you can’t say “Well, there may be truth to both views”. Either the economy is supply-constrained or it’s demand-constrained. Of course even the most ardent demand-siders will admit that there are supply constraints in there somewhere, that if we had an economic boom we would, after some period of time, enter a regime where printing money is inflationary and government borrowing drive up interest rates. But not here, not now.
So yes, the price is wrong — but it’s a terrible, disastrous mistake to focus on the wrong wrong price.
SourceSlanted piece, but I feel it sums up the economic fundamentals at play right now.
"So, start with our big problem, which is mass unemployment. Basic supply and demand analysis says that things like that aren’t supposed to happen: prices are supposed to rise or fall to clear markets. So what’s with this apparent massive and persistent excess supply of labor?"
People are very reluctant to buy houses if they don't need them. Lowering the price doesn't cut it (if the oversupply is large enough).
Cheers.
|
OKLAHOMA CITY -- Oklahoma's 50-year-old ban on horse slaughtering was lifted Friday when the governor signed a new law that will allow facilities to process and export horse meat, despite bitter opposition by animal rights activists.
Supporters argue that a horse slaughtering facility in Oklahoma will provide a humane alternative for aging or starving horses, many of which are abandoned in rural parts of the state by owners who can no longer afford to care for them. Gov. Mary Fallin also noted that horses are already being shipped out of the country, including to facilities in Mexico, where they are processed in potentially inhumane conditions.
According to the U.S. Department of Agriculture, more than 166,000 horses were sent to Canada and Mexico last year alone.
"In Oklahoma, as in other states, abuse is tragically common among horses that are reaching the end of their natural lives," the Republican governor said. "Those of us who care about the wellbeing of horses – and we all should – cannot be satisfied with a status quo that encourages abuse and neglect, or that rewards the potentially inhumane slaughter of animals in foreign countries."
She noted that law strictly prohibits the selling of horse meat for human consumption in the U.S.
Similar efforts are under way in other states, but not without controversy. In New Mexico, a processing plant has been fighting the U.S. Department of Agriculture for more than a year for approval to convert its former cattle slaughter operation into a horse slaughterhouse. In Nevada, state agriculture officials have discussed ways to muster support for the slaughter of free-roaming horses, stirring protests.
Source
|
On March 31 2013 14:06 {CC}StealthBlue wrote:Show nested quote +OKLAHOMA CITY -- Oklahoma's 50-year-old ban on horse slaughtering was lifted Friday when the governor signed a new law that will allow facilities to process and export horse meat, despite bitter opposition by animal rights activists.
Supporters argue that a horse slaughtering facility in Oklahoma will provide a humane alternative for aging or starving horses, many of which are abandoned in rural parts of the state by owners who can no longer afford to care for them. Gov. Mary Fallin also noted that horses are already being shipped out of the country, including to facilities in Mexico, where they are processed in potentially inhumane conditions.
According to the U.S. Department of Agriculture, more than 166,000 horses were sent to Canada and Mexico last year alone.
"In Oklahoma, as in other states, abuse is tragically common among horses that are reaching the end of their natural lives," the Republican governor said. "Those of us who care about the wellbeing of horses – and we all should – cannot be satisfied with a status quo that encourages abuse and neglect, or that rewards the potentially inhumane slaughter of animals in foreign countries."
She noted that law strictly prohibits the selling of horse meat for human consumption in the U.S.
Similar efforts are under way in other states, but not without controversy. In New Mexico, a processing plant has been fighting the U.S. Department of Agriculture for more than a year for approval to convert its former cattle slaughter operation into a horse slaughterhouse. In Nevada, state agriculture officials have discussed ways to muster support for the slaughter of free-roaming horses, stirring protests. Source
Stop derailing my attempt to talk about current economic policy, dammit! 
On March 31 2013 13:55 JonnyBNoHo wrote:Show nested quote +On March 31 2013 13:18 aksfjh wrote:The Price Is Wrong
But which price — that is the question.
It’s a slow morning on the economic news front, as we wait for various euro shoes to drop, so I thought I’d share a meditation I’ve been having on the diagnosis and misdiagnosis of the Lesser Depression. It’s not really different from what I’ve been saying all along, but maybe coming at it from a different angle is somewhat enlightening.
So, start with our big problem, which is mass unemployment. Basic supply and demand analysis says that things like that aren’t supposed to happen: prices are supposed to rise or fall to clear markets. So what’s with this apparent massive and persistent excess supply of labor?
In general, market disequilibrium is a sign of prices out of whack; and most people commenting on our mess accept the notion that one or more prices are for some reason not adjusting. The big divide comes over the question of which price is wrong.
As I see it, the whole structural/classical/Austrian/supply-side/whatever side of this debate basically believes that the problem lies in the labor market. (I know, the Austrians will deny it — but it doesn’t matter what you say about their position, any comprehensible statement leads to angry claims that you don’t understand their depths). For some reason, they would argue, wages are too high given the demand for labor. Some of them accept the notion that it’s because of downward nominal wage rigidity; more, I think, believe that workers are being encouraged to hold out for unsustainable wages by moocher-friendly programs like food stamps, unemployment benefits, disability insurance, and whatever.
As regular readers know, I find this prima facie absurd — it’s essentially the claim that soup kitchens caused the Great Depression. But let’s stick with the economic logic for now.
So what’s the alternative view? It’s basically the notion that the interest rate is wrong — that given the overhang of debt and other factors depressing private demand, real interest rates would have to be deeply negative to match desired saving with desired investment at full employment. And real rates can’t go that negative because expected inflation is low and nominal rates can’t go below zero: we’re in a liquidity trap.
There are strong policy implications of these two views. If you think the problem is that wages are too high, your solution is that we need to meaner to workers — cut off their unemployment insurance, make them hungry by cutting off food stamps, so they have no alternative to do whatever it takes to get jobs, and wages fall. If you think the problem is the zero lower bound on interest rates, you think that this kind of solution wouldn’t just be cruel, it would make the economy worse, both because cutting workers’ incomes would reduce demand and because deflation would increase the burden of debt.
What my side of the debate would call for, instead, is a reduction in the real interest rate, if possible, by raising expected inflation; and failing that, more government spending to increase demand and put idle resources to work.
So how can you tell which side is right? Well, these differing views make differing predictions. If you believe that the problem is excessive wages, you believe that the economy is fundamentally suffering from a supply-side constraint. In that case government borrowing is competing with the private sector for a limited quantity of resources, so big budget deficits should lead to soaring interest rates; meanwhile, because the supply of goods is limited, large increases in the money supply should lead to soaring inflation. Oh, and cuts in government spending should, if anything, be expansionary, because they both release resources to the private sector and make life tougher for workers who try to live on public benefits.
If, on the other hand, you believe that the problem lies in a shortfall of demand due to the zero lower bound, you believe that government borrowing needn’t drive up rates, because it puts unemployed resources to work; that monetary expansion won’t be inflationary, because the money will just sit there; and that fiscal austerity will be strongly contractionary.
I leave the adjudication of these competing claims as an exercise for readers.
Oh, and one more thing: no, you can’t say “Well, there may be truth to both views”. Either the economy is supply-constrained or it’s demand-constrained. Of course even the most ardent demand-siders will admit that there are supply constraints in there somewhere, that if we had an economic boom we would, after some period of time, enter a regime where printing money is inflationary and government borrowing drive up interest rates. But not here, not now.
So yes, the price is wrong — but it’s a terrible, disastrous mistake to focus on the wrong wrong price.
SourceSlanted piece, but I feel it sums up the economic fundamentals at play right now. "So, start with our big problem, which is mass unemployment. Basic supply and demand analysis says that things like that aren’t supposed to happen: prices are supposed to rise or fall to clear markets. So what’s with this apparent massive and persistent excess supply of labor?" People are very reluctant to buy houses if they don't need them. Lowering the price doesn't cut it (if the oversupply is large enough). Cheers.
I'm not sure if you're trying to draw a parallel, or if you're saying unemployment is literally low because of too many houses on the market...
|
On March 31 2013 14:13 aksfjh wrote:Show nested quote +On March 31 2013 14:06 {CC}StealthBlue wrote:OKLAHOMA CITY -- Oklahoma's 50-year-old ban on horse slaughtering was lifted Friday when the governor signed a new law that will allow facilities to process and export horse meat, despite bitter opposition by animal rights activists.
Supporters argue that a horse slaughtering facility in Oklahoma will provide a humane alternative for aging or starving horses, many of which are abandoned in rural parts of the state by owners who can no longer afford to care for them. Gov. Mary Fallin also noted that horses are already being shipped out of the country, including to facilities in Mexico, where they are processed in potentially inhumane conditions.
According to the U.S. Department of Agriculture, more than 166,000 horses were sent to Canada and Mexico last year alone.
"In Oklahoma, as in other states, abuse is tragically common among horses that are reaching the end of their natural lives," the Republican governor said. "Those of us who care about the wellbeing of horses – and we all should – cannot be satisfied with a status quo that encourages abuse and neglect, or that rewards the potentially inhumane slaughter of animals in foreign countries."
She noted that law strictly prohibits the selling of horse meat for human consumption in the U.S.
Similar efforts are under way in other states, but not without controversy. In New Mexico, a processing plant has been fighting the U.S. Department of Agriculture for more than a year for approval to convert its former cattle slaughter operation into a horse slaughterhouse. In Nevada, state agriculture officials have discussed ways to muster support for the slaughter of free-roaming horses, stirring protests. Source Stop derailing my attempt to talk about current economic policy, dammit! Show nested quote +On March 31 2013 13:55 JonnyBNoHo wrote:On March 31 2013 13:18 aksfjh wrote:The Price Is Wrong
But which price — that is the question.
It’s a slow morning on the economic news front, as we wait for various euro shoes to drop, so I thought I’d share a meditation I’ve been having on the diagnosis and misdiagnosis of the Lesser Depression. It’s not really different from what I’ve been saying all along, but maybe coming at it from a different angle is somewhat enlightening.
So, start with our big problem, which is mass unemployment. Basic supply and demand analysis says that things like that aren’t supposed to happen: prices are supposed to rise or fall to clear markets. So what’s with this apparent massive and persistent excess supply of labor?
In general, market disequilibrium is a sign of prices out of whack; and most people commenting on our mess accept the notion that one or more prices are for some reason not adjusting. The big divide comes over the question of which price is wrong.
As I see it, the whole structural/classical/Austrian/supply-side/whatever side of this debate basically believes that the problem lies in the labor market. (I know, the Austrians will deny it — but it doesn’t matter what you say about their position, any comprehensible statement leads to angry claims that you don’t understand their depths). For some reason, they would argue, wages are too high given the demand for labor. Some of them accept the notion that it’s because of downward nominal wage rigidity; more, I think, believe that workers are being encouraged to hold out for unsustainable wages by moocher-friendly programs like food stamps, unemployment benefits, disability insurance, and whatever.
As regular readers know, I find this prima facie absurd — it’s essentially the claim that soup kitchens caused the Great Depression. But let’s stick with the economic logic for now.
So what’s the alternative view? It’s basically the notion that the interest rate is wrong — that given the overhang of debt and other factors depressing private demand, real interest rates would have to be deeply negative to match desired saving with desired investment at full employment. And real rates can’t go that negative because expected inflation is low and nominal rates can’t go below zero: we’re in a liquidity trap.
There are strong policy implications of these two views. If you think the problem is that wages are too high, your solution is that we need to meaner to workers — cut off their unemployment insurance, make them hungry by cutting off food stamps, so they have no alternative to do whatever it takes to get jobs, and wages fall. If you think the problem is the zero lower bound on interest rates, you think that this kind of solution wouldn’t just be cruel, it would make the economy worse, both because cutting workers’ incomes would reduce demand and because deflation would increase the burden of debt.
What my side of the debate would call for, instead, is a reduction in the real interest rate, if possible, by raising expected inflation; and failing that, more government spending to increase demand and put idle resources to work.
So how can you tell which side is right? Well, these differing views make differing predictions. If you believe that the problem is excessive wages, you believe that the economy is fundamentally suffering from a supply-side constraint. In that case government borrowing is competing with the private sector for a limited quantity of resources, so big budget deficits should lead to soaring interest rates; meanwhile, because the supply of goods is limited, large increases in the money supply should lead to soaring inflation. Oh, and cuts in government spending should, if anything, be expansionary, because they both release resources to the private sector and make life tougher for workers who try to live on public benefits.
If, on the other hand, you believe that the problem lies in a shortfall of demand due to the zero lower bound, you believe that government borrowing needn’t drive up rates, because it puts unemployed resources to work; that monetary expansion won’t be inflationary, because the money will just sit there; and that fiscal austerity will be strongly contractionary.
I leave the adjudication of these competing claims as an exercise for readers.
Oh, and one more thing: no, you can’t say “Well, there may be truth to both views”. Either the economy is supply-constrained or it’s demand-constrained. Of course even the most ardent demand-siders will admit that there are supply constraints in there somewhere, that if we had an economic boom we would, after some period of time, enter a regime where printing money is inflationary and government borrowing drive up interest rates. But not here, not now.
So yes, the price is wrong — but it’s a terrible, disastrous mistake to focus on the wrong wrong price.
SourceSlanted piece, but I feel it sums up the economic fundamentals at play right now. "So, start with our big problem, which is mass unemployment. Basic supply and demand analysis says that things like that aren’t supposed to happen: prices are supposed to rise or fall to clear markets. So what’s with this apparent massive and persistent excess supply of labor?" People are very reluctant to buy houses if they don't need them. Lowering the price doesn't cut it (if the oversupply is large enough). Cheers. I'm not sure if you're trying to draw a parallel, or if you're saying unemployment is literally low because of too many houses on the market...
Literally (though unemployment is high because of it).
|
On March 31 2013 14:06 {CC}StealthBlue wrote:Show nested quote +OKLAHOMA CITY -- Oklahoma's 50-year-old ban on horse slaughtering was lifted Friday when the governor signed a new law that will allow facilities to process and export horse meat, despite bitter opposition by animal rights activists.
Supporters argue that a horse slaughtering facility in Oklahoma will provide a humane alternative for aging or starving horses, many of which are abandoned in rural parts of the state by owners who can no longer afford to care for them. Gov. Mary Fallin also noted that horses are already being shipped out of the country, including to facilities in Mexico, where they are processed in potentially inhumane conditions.
According to the U.S. Department of Agriculture, more than 166,000 horses were sent to Canada and Mexico last year alone.
"In Oklahoma, as in other states, abuse is tragically common among horses that are reaching the end of their natural lives," the Republican governor said. "Those of us who care about the wellbeing of horses – and we all should – cannot be satisfied with a status quo that encourages abuse and neglect, or that rewards the potentially inhumane slaughter of animals in foreign countries."
She noted that law strictly prohibits the selling of horse meat for human consumption in the U.S.
Similar efforts are under way in other states, but not without controversy. In New Mexico, a processing plant has been fighting the U.S. Department of Agriculture for more than a year for approval to convert its former cattle slaughter operation into a horse slaughterhouse. In Nevada, state agriculture officials have discussed ways to muster support for the slaughter of free-roaming horses, stirring protests. Source
Boxer is being sent to the glue factory, both figuratively and literally it seems.
|
Cayman Islands24199 Posts
|
It never ceases to amaze what people will get upset about 0.o. I read a few comments on that, it was a mistake to read those lol .
|
A bipartisan agreement on an immigration reform plan has been reached, Sen. Lindsey Graham (R-S.C.) said Sunday on CNN's "State of the Union."
Graham is a member of the bipartisan "gang of eight" tackling immigration reform , which hit roadblocks last week over the issue of worker visas. But Graham sounded a more optimistic note Sunday, telling CNN's Candy Crowley, "I think we've got a deal."
"We've got to write the legislation, but 2013, I hope, will be the year that we pass bipartisan immigration reform," he said.
Graham said the bill would have three goals: to prevent a "third wave" of undocumented immigrants moving into the United States, to allow employers who can't find American workers at competitive wages to hire guest workers and to weigh immigration decisions largely on merit rather than family relations.
Undocumented immigrants "will have a path to citizenship, but it will be earned, it will be long, and I think it will be fair," he said.
Graham said while a bill is yet to be drafted, there is broad agreement on its outlines, and he believed the resulting legislation would make it through the House.
“It’s got to be written up ... But conceptually, we have an agreement between business and labor, between ourselves," Graham said.
Another gang-of-eight member, Sen. Chuck Schumer (D-N.Y.), also said Sunday on "Meet the Press" that a deal was close at hand.
Source
|
On April 01 2013 06:25 BlueBird. wrote:It never ceases to amaze what people will get upset about 0.o. I read a few comments on that, it was a mistake to read those lol .
Ugh....it blows my mind that so many people are dumbfounded when their religion isn't acknowledged. Those comments.....
#furiated
|
On March 31 2013 13:55 JonnyBNoHo wrote:Show nested quote +On March 31 2013 13:18 aksfjh wrote:The Price Is Wrong
But which price — that is the question.
It’s a slow morning on the economic news front, as we wait for various euro shoes to drop, so I thought I’d share a meditation I’ve been having on the diagnosis and misdiagnosis of the Lesser Depression. It’s not really different from what I’ve been saying all along, but maybe coming at it from a different angle is somewhat enlightening.
So, start with our big problem, which is mass unemployment. Basic supply and demand analysis says that things like that aren’t supposed to happen: prices are supposed to rise or fall to clear markets. So what’s with this apparent massive and persistent excess supply of labor?
In general, market disequilibrium is a sign of prices out of whack; and most people commenting on our mess accept the notion that one or more prices are for some reason not adjusting. The big divide comes over the question of which price is wrong.
As I see it, the whole structural/classical/Austrian/supply-side/whatever side of this debate basically believes that the problem lies in the labor market. (I know, the Austrians will deny it — but it doesn’t matter what you say about their position, any comprehensible statement leads to angry claims that you don’t understand their depths). For some reason, they would argue, wages are too high given the demand for labor. Some of them accept the notion that it’s because of downward nominal wage rigidity; more, I think, believe that workers are being encouraged to hold out for unsustainable wages by moocher-friendly programs like food stamps, unemployment benefits, disability insurance, and whatever.
As regular readers know, I find this prima facie absurd — it’s essentially the claim that soup kitchens caused the Great Depression. But let’s stick with the economic logic for now.
So what’s the alternative view? It’s basically the notion that the interest rate is wrong — that given the overhang of debt and other factors depressing private demand, real interest rates would have to be deeply negative to match desired saving with desired investment at full employment. And real rates can’t go that negative because expected inflation is low and nominal rates can’t go below zero: we’re in a liquidity trap.
There are strong policy implications of these two views. If you think the problem is that wages are too high, your solution is that we need to meaner to workers — cut off their unemployment insurance, make them hungry by cutting off food stamps, so they have no alternative to do whatever it takes to get jobs, and wages fall. If you think the problem is the zero lower bound on interest rates, you think that this kind of solution wouldn’t just be cruel, it would make the economy worse, both because cutting workers’ incomes would reduce demand and because deflation would increase the burden of debt.
What my side of the debate would call for, instead, is a reduction in the real interest rate, if possible, by raising expected inflation; and failing that, more government spending to increase demand and put idle resources to work.
So how can you tell which side is right? Well, these differing views make differing predictions. If you believe that the problem is excessive wages, you believe that the economy is fundamentally suffering from a supply-side constraint. In that case government borrowing is competing with the private sector for a limited quantity of resources, so big budget deficits should lead to soaring interest rates; meanwhile, because the supply of goods is limited, large increases in the money supply should lead to soaring inflation. Oh, and cuts in government spending should, if anything, be expansionary, because they both release resources to the private sector and make life tougher for workers who try to live on public benefits.
If, on the other hand, you believe that the problem lies in a shortfall of demand due to the zero lower bound, you believe that government borrowing needn’t drive up rates, because it puts unemployed resources to work; that monetary expansion won’t be inflationary, because the money will just sit there; and that fiscal austerity will be strongly contractionary.
I leave the adjudication of these competing claims as an exercise for readers.
Oh, and one more thing: no, you can’t say “Well, there may be truth to both views”. Either the economy is supply-constrained or it’s demand-constrained. Of course even the most ardent demand-siders will admit that there are supply constraints in there somewhere, that if we had an economic boom we would, after some period of time, enter a regime where printing money is inflationary and government borrowing drive up interest rates. But not here, not now.
So yes, the price is wrong — but it’s a terrible, disastrous mistake to focus on the wrong wrong price.
SourceSlanted piece, but I feel it sums up the economic fundamentals at play right now. "So, start with our big problem, which is mass unemployment. Basic supply and demand analysis says that things like that aren’t supposed to happen: prices are supposed to rise or fall to clear markets. So what’s with this apparent massive and persistent excess supply of labor?" People are very reluctant to buy houses if they don't need them. Lowering the price doesn't cut it (if the oversupply is large enough). Cheers.
So even if the price of a house reduces to $1, people still won't buy it because there's too many houses? I would think that if the price fell to $1 the opposite would occur: demand > supply.
Krugman is right that basic supply and demand says that at some price, probably between current prices and $1, we should hit a equilibrium where supply equals demand. He argues that basic supply and demand says the same thing about labor.
His point is that this obviously isn't happening, so the question is then: what rigidity is preventing the price of labor or houses or whatever, adjusting to a level where supply equals demand? In short, what is causing basic supply and demand to be wrong?
|
Cayman Islands24199 Posts
the basic supply and demand story makes use of instantaneously 'calculating' equations, whereas in the real world each demand event is quite complex. employers want to hire cheaper labor, always, but they don't really suddenly have the job positions open up because the price of labor is lowered.
wage stickiness on the supply part (idle workers holding out for positions with better pay/relative to their previous wage) is also not the entire story. the simple "if price of labor low, demand goes up" story is more true for low skill, low status jobs(and unpaid interns). for jobs with higher skill and status, wage itself is a status symbol that employees judge each other by. if you hire a bunch of guys at a cut rate wage with the same position status as existing workers, it'll reflect poorly on the company. it will make existing workers feel that they are expendable.
labor saving technology and pressure also let companies adjust to lower personnel levels after a down cycle. they'll expand only when the business is going well and expansion is strategically sound to fulfill future expansion opportunity. this is the previously mentioned 'demand instance,' and it isn't simply triggered by a lowering of the cost of labor.
|
On April 01 2013 12:12 paralleluniverse wrote:Show nested quote +On March 31 2013 13:55 JonnyBNoHo wrote:On March 31 2013 13:18 aksfjh wrote:The Price Is Wrong
But which price — that is the question.
It’s a slow morning on the economic news front, as we wait for various euro shoes to drop, so I thought I’d share a meditation I’ve been having on the diagnosis and misdiagnosis of the Lesser Depression. It’s not really different from what I’ve been saying all along, but maybe coming at it from a different angle is somewhat enlightening.
So, start with our big problem, which is mass unemployment. Basic supply and demand analysis says that things like that aren’t supposed to happen: prices are supposed to rise or fall to clear markets. So what’s with this apparent massive and persistent excess supply of labor?
In general, market disequilibrium is a sign of prices out of whack; and most people commenting on our mess accept the notion that one or more prices are for some reason not adjusting. The big divide comes over the question of which price is wrong.
As I see it, the whole structural/classical/Austrian/supply-side/whatever side of this debate basically believes that the problem lies in the labor market. (I know, the Austrians will deny it — but it doesn’t matter what you say about their position, any comprehensible statement leads to angry claims that you don’t understand their depths). For some reason, they would argue, wages are too high given the demand for labor. Some of them accept the notion that it’s because of downward nominal wage rigidity; more, I think, believe that workers are being encouraged to hold out for unsustainable wages by moocher-friendly programs like food stamps, unemployment benefits, disability insurance, and whatever.
As regular readers know, I find this prima facie absurd — it’s essentially the claim that soup kitchens caused the Great Depression. But let’s stick with the economic logic for now.
So what’s the alternative view? It’s basically the notion that the interest rate is wrong — that given the overhang of debt and other factors depressing private demand, real interest rates would have to be deeply negative to match desired saving with desired investment at full employment. And real rates can’t go that negative because expected inflation is low and nominal rates can’t go below zero: we’re in a liquidity trap.
There are strong policy implications of these two views. If you think the problem is that wages are too high, your solution is that we need to meaner to workers — cut off their unemployment insurance, make them hungry by cutting off food stamps, so they have no alternative to do whatever it takes to get jobs, and wages fall. If you think the problem is the zero lower bound on interest rates, you think that this kind of solution wouldn’t just be cruel, it would make the economy worse, both because cutting workers’ incomes would reduce demand and because deflation would increase the burden of debt.
What my side of the debate would call for, instead, is a reduction in the real interest rate, if possible, by raising expected inflation; and failing that, more government spending to increase demand and put idle resources to work.
So how can you tell which side is right? Well, these differing views make differing predictions. If you believe that the problem is excessive wages, you believe that the economy is fundamentally suffering from a supply-side constraint. In that case government borrowing is competing with the private sector for a limited quantity of resources, so big budget deficits should lead to soaring interest rates; meanwhile, because the supply of goods is limited, large increases in the money supply should lead to soaring inflation. Oh, and cuts in government spending should, if anything, be expansionary, because they both release resources to the private sector and make life tougher for workers who try to live on public benefits.
If, on the other hand, you believe that the problem lies in a shortfall of demand due to the zero lower bound, you believe that government borrowing needn’t drive up rates, because it puts unemployed resources to work; that monetary expansion won’t be inflationary, because the money will just sit there; and that fiscal austerity will be strongly contractionary.
I leave the adjudication of these competing claims as an exercise for readers.
Oh, and one more thing: no, you can’t say “Well, there may be truth to both views”. Either the economy is supply-constrained or it’s demand-constrained. Of course even the most ardent demand-siders will admit that there are supply constraints in there somewhere, that if we had an economic boom we would, after some period of time, enter a regime where printing money is inflationary and government borrowing drive up interest rates. But not here, not now.
So yes, the price is wrong — but it’s a terrible, disastrous mistake to focus on the wrong wrong price.
SourceSlanted piece, but I feel it sums up the economic fundamentals at play right now. "So, start with our big problem, which is mass unemployment. Basic supply and demand analysis says that things like that aren’t supposed to happen: prices are supposed to rise or fall to clear markets. So what’s with this apparent massive and persistent excess supply of labor?" People are very reluctant to buy houses if they don't need them. Lowering the price doesn't cut it (if the oversupply is large enough). Cheers. So even if the price of a house reduces to $1, people still won't buy it because there's too many houses? I would think that if the price fell to $1 the opposite would occur: demand > supply. Krugman is right that basic supply and demand says that at some price, probably between current prices and $1, we should hit a equilibrium where supply equals demand. He argues that basic supply and demand says the same thing about labor. His point is that this obviously isn't happening, so the question is then: what rigidity is preventing the price of labor or houses or whatever, adjusting to a level where supply equals demand? In short, what is causing basic supply and demand to be wrong?
A house for $1 costs more than $1 (taxes, insurance, maintenance, vandalism, etc.). So you really want a reason for owning the house beyond the novelty. If you look at a market with a serious supply / demand issue the prices are silly low (ex. Detroit).
More importantly, if prices fall too low then builders won't build any more (building provides the jobs - selling existing homes not so much). You could argue that the entire supply chain should / could enact price reductions to firm up demand but the massive price reductions that would be necessary just aren't feasible.
So we've kinda just been waiting for the excess to clear. It looks like it finished clearing a few months ago and so there's finally a lot of excitement and hope that the sector will return to normal.
|
On April 01 2013 13:21 JonnyBNoHo wrote:
So we've kinda just been waiting for the excess to clear. It looks like it finished clearing a few months ago and so there's finally a lot of excitement and hope that the sector will return to normal.
i've never been able to explain to the five-year-old me why having too much of anything could ever possibly be a problem.
edit: now me - it's very bad, the economy is sad, it's because they made too many houses
five-year-old me - oh, well, jeez, that sucks  at least everyone can have a house tho
now me - no, that means people lose their houses
five-year-old me - ...?
the grown up world is too complicated tt
|
On April 01 2013 08:12 kmillz wrote:Show nested quote +On April 01 2013 06:25 BlueBird. wrote:It never ceases to amaze what people will get upset about 0.o. I read a few comments on that, it was a mistake to read those lol . Ugh....it blows my mind that so many people are dumbfounded when their religion isn't acknowledged. Those comments..... #furiated
The salvos go back and forth. I'm trying to remember the earliest known attack for this and it might be this one 2007. In defense of the guys getting picky, it isn't their first time raising eyebrows. In defense of Google you can't please everybody and its just a logo.
Google is famously associated with left-wing causes, which just paints a little bigger bullseye on them for the vocal fringe.
|
|
|
|
|
|
EPT
