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What happened to all of the doom and gloom economic threads?

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4est_4est_Gump said:
I tried to speak down to your level of comprehension.

You make Jesuits turn to Satan for succor...
Click to expand...

Aww, AJ's pullin' out all the big guns this mornin....first he's a victim...A VICTIM DAMMIT....then he's an Internet Tough Guy...and now he's goin' full Byron!
 
While the ship begins to list, merc strikes up the band and cues up "Happy Days are Here Again!"

Yesterday, the Federal Open Market Committee (FOMC) released the minutes from its June meeting, giving financial industry analysts a peek inside what our illustrious leaders at the Federal Reserve are thinking. Unfortunately, there is little agreement as to what the meeting notes mean—there's a near 50/50 split on whether the FOMC’s concerns about a deteriorating economy are proof positive that we’ll see QE3 or some other monetary stimulus program later this year.

QE—or quantitative easing—is a fancy way of saying create money out of thin air to put in a digital bank account and then spend on mortgage-backed securities or government debt in order to lower long-term interest rates. It's kind of like that Libor interest rate scandal you might have read about, except the Fed fixing interest rates is, well, sold as more of a market driven process for setting rates at a non-market established rate.

Beyond disagreement in the perennial guessing game of “What Will Bernanke Do Next?”, there is plenty of debate over whether monetary policy can even influence interest rates any further. Since QE2 and Operation Twist have not moved long-term interest rates much, a third round (fifth round if you could the two “twists”) of monetary stimulus is unlikely to have any additional impact.

Still, even if QE3 could substantively impact the market, there remains the question of whether the weak economy merits more monetary stimulus. For example, unemployment remains high, but it matters whether the problems in the labor market are structural or still remnant of the financial crisis. If unemployment is due to economic immobility, education gaps, and changes in growth sectors of the economy (i.e., more IT workers needed for cloud computing and fewer manufacturing workers needed to operate machinery) then more QE is not the prescription for the economy. If the problem is just that the economy needs a better jumpstart for borrowing to lead to consumption and investments, then leading to hiring, then QE could be warranted (from a neo-Keynesian perspective).

But all of this misses the point in the monetary policy debate.

While the mainstream coverage of the Fed has focused guessing what tie Bernanke will wear when he nexts argues with Rep. Ron Paul (R-Texas) during congressional hearings, or whether there is more room for monetary stimulus to continue aiding the economy, we’ve failed to ask a simple question: Is the current monetary policy paradigm actually helping economic growth?

...

In what ways are Federal Reserve monetary stimulus policies causing more harm than good?

First, monetary policy is creating a future asset bubble crisis. Consider that cheap money does inspire borrowing, even if not at the levels monetary policymakers would have preferred. Since the start of quantitative easing in 2010, equity prices have steadily grown with investors able to borrow for virtually nothing and take advantage of arbitrage opportunities in a volatile stock market. Commodities like gold, cotton, wheat, heating oil, and coffee are all higher as well, as traders have used cheap money to flood the future markets.

The fears of bubbles are well founded. Consider that unemployment remains high, economic growth stagnant to non-existent, and household debt still sky high. So how is it that the stock market can be 10 percent to 15 percent higher than in 2005 and 2006 at the height of the housing bubble and be seen as in anyway sustainable? And when the Fed does eventually decide to tighten policy from today’s levels this could suck the life out of commodities trades funded not with capital raised in normal markets, but with cheap capital funded by a manipulative Fed.

So when these asset bubbles eventually unwind, it could be very painful. Supporting asset prices masks problems on bank balance sheets, and we could see another example of the subprime crisis as toxic assets are revealed when prices decline.

Essentially we will have responded to the deflation of one bubble (housing) with another. Unfortunately, that would make for a trend. The Fed responded to the dot-com bubble’s bursting with policy that created another bubble, and congressional and regulatory policies channeled this into the housing market. In effect, this is an intentional cycle of boom, bubble, bust. A present crisis is solved by creating a future crisis.
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http://reason.com/archives/2012/07/12/the-harms-of-monetary-policy

But hey!

The stock market is over 12K...

12K A_J!!!

:cool:
 
Hey merc, why can't you tell us why the economy is so good?



Why do you have to attack everyone who says it's not?
 
RobDownSouth said:
Aww, AJ's pullin' out all the big guns this mornin....first he's a victim...A VICTIM DAMMIT....then he's an Internet Tough Guy...and now he's goin' full Byron!
Click to expand...


Whenever I ask him a question he declares himself a victim of an attack. I seem to have a shit ton of power over him.
 
4est_4est_Gump said:
Hey merc, why can't you tell us why the economy is so good?



Why do you have to attack everyone who says it's not?
Click to expand...

Come on, put down the ad hominem, put on your big boy pants and give us your "expert, impartial" analysis on all the positive indicators showing us why there is no reason what-so-ever to feel gloomy about the economy because most of us are pretty sure you can't which is why all the patty hate, spite and quacking...
 
One Bear . . .


not a name to inspire shock and awe.


Except for some "awwwwwwww", maybe.
 
mercury14 said:
Apparently I'm some kind of ferocious bear to you.

Either that or you're very insecure.
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You're an outed liar.

You're an idiot to me and for the most part I love the way you display what passes for liberal...

You and Throb both.

mercury14 said:
While you're at it, could you come up with a plan to cancel out America's nigger amnesty policy? And who gave Pocahontas and her drunk-ass tribe citizenship?
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4est_4est_Gump said:
Come on, put down the ad hominem, put on your big boy pants and give us your "expert, impartial" analysis on all the positive indicators showing us why there is no reason what-so-ever to feel gloomy about the economy because most of us are pretty sure you can't which is why all the patty hate, spite and quacking...
Click to expand...


I didn't claim that there's no reason to feel gloomy about the economy. I simply echoed the broadly-held professional opinion that there has been a substantial recovery which has recently become tepid. I can understand why that would make some people feel gloomy.

What's the next position you'll assign to me?
 
mercury14 said:
I didn't claim that there's no reason to feel gloomy about the economy. I simply echoed the broadly-held professional opinion that there has been a substantial recovery which has recently become tepid. I can understand why that would make some people feel gloomy.

What's the next position you'll assign to me?
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You never claim anything...

Trying to say that we have had a substantial recovery is wishful partisan thinking. We understand why you're always so angry and confrontational.

Prove it's "broadly held."
 
4est_4est_Gump said:
You never claim anything...

Trying to say that we have had a substantial recovery is wishful partisan thinking. We understand why you're always so angry and confrontational.

Prove it's "broadly held."
Click to expand...

Keep Merc on the defensive, AJ! That way you'll never EVAR have to explain the flaws in your position!

It's teh GLIBERTARIAN WAY! Attack attack attack-ack-ack-ack!!
 
4est_4est_Gump said:
You never claim anything...

Trying to say that we have had a substantial recovery is wishful partisan thinking. We understand why you're always so angry and confrontational.
Click to expand...

I already proved that there's been a substantial recovery by every significant economic measure. You've countered my points with ad hominem. I won that debate.


4est_4est_Gump said:
Prove it's "broadly held."
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It's broadly held because every economist and business analyst realize that a +700,000 job-per-month swing and a +8.5% swing in the GDP counts as an improvement.
 
RobDownSouth said:
Keep Merc on the defensive, AJ! That way you'll never EVAR have to explain the flaws in your position!

It's teh GLIBERTARIAN WAY! Attack attack attack-ack-ack-ack!!
Click to expand...


It's okay, I keep backing this very point and sending AJ off to C&P land. It's easy peasy. AJ is left struggling against basic logic with distortion and partisanship as his only blunt weapons.
 
mercury14 said:
I already proved that there's been a substantial recovery by every significant economic measure. You've countered my points with ad hominem. I won that debate.




It's broadly held because every economist and business analyst realize that a +700,000 job-per-month swing and a +8.5% swing in the GDP counts as an improvement.
Click to expand...

No you didn't.

No you didn't.

You're cherry-picking your start point and ignoring the fact that we were purposely panicked into a lower state than we would have hit naturally for political gain by Democrats eager to win an election.

Also you have again delved into the system/sophism/fallacy of "every" economist.
 
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