Thank you Mr Biden for letting me know that I along with most Americans are not longer worried or concerned about the economy, it gives me great peace of mind.
Thank you Mr Biden for letting me know that I along with most Americans are not longer worried or concerned about the economy, it gives me great peace of mind.
Right up there with his self defense advice for women. Open space is jealous of the vacuum between his ears.
That's not quite what he said:
The are no longer traumatized by what was a traumatizing event, the great collapse of 2008. They are no longer worried, I think, about our economy being overwhelmed either by Europe writ large, the EU, or China somehow swallowing up every bit of innovation that exists in the world. They're no longer, I think, worried about our economy being overwhelmed beyond our shores.
Everyone I know is pretty much convinced China does own us and will continue to own us, both competitively and literally through our issuance of debt. There is no faith that the US can compete globally in production of much of anything than pop culture and entertainment. Just as dumb a statement as any. Not his worst though, he's got a ton of those.
Technically he's right I guess. We're not worried. We've moved on to the acceptance stage.
Then everyone you know has a severe misunderstanding of the situation. However, given the jokes on late night about China and the US, it's not surprising that people think that way. Biden obviously believes the average American is better informed than they actually are.Originally Posted by CitizenBBN
Yes, I hang out with lots of uneducated morons.
Of course that's beside the point. the question isn't what is right but what people think, and that is what they think and thus Biden's statement is ignorant.
As for its accuracy, those people are right in that we have no hope whatsoever in the current economic structure of competing with anyone esp. China in production of actual things. Too much cheap energy, cheap labor, low overhead (including heavily pro-business near industrial fascism regulation) and not enough brain drain coming this way. China focuses on production, we focus on sucking every last penny out of our economic base to hand out free cellphones.
They're also right we're borrowing ourselves into being a 2nd class nation economically and politically. We can debate whether a country "owns us" b/c they hold US treasuries, but the people have nailed the guts of it, that we are borrowing money from other places b/c we don't have enough to borrow from ourselves and spending it in ways that will in no way improve our ability to make the money to pay it back.
They know credit card addiction when they see it apparently, and while they may not understand whether a bank or a card company holds the debt they know where the person who owes it all is headed.
I'll be sure and tell my friends they don't understand the international economic ties between us and China. They're going to laugh their a$$es off.
Competing in what industry? Exportation of manufactured goods? That's been going out the door for decades and is a side-effect of being a developed nation, but we are still the world's largest manufacturer of goods (in real output and real value). The US economy is still the world's largest by a LARGE margin (if you don't count the EU) and will continue to be for the foreseeable future because we lead in the industries of technology and health and still produce A LOT of stuff ourselves. China outpaces our annual growth rate currently, but that won't hold long enough for them to overtake us ever. Also, as a matter of fact, we focus on sucking every last penny out of our economic base to pay for Social Security, Medicare, and the Department of Defense. Your little barb about free cellphones is a relative pittance comparatively and is largely irrelevant as a result.
They are not right in that we're borrowing ourselves into being a 2nd class nation economically and politically because, again, they don't understand how our debt is serviced. Foreign ownership of US Treasury bonds is 32% of the total outstanding. The majority of US Treasury Bonds are held by federal government agencies, the Federal Treasury, and the American public. Of that 32%, China in particular only holds 8%. If China were to stop buying US Treasury bonds tomorrow (which they wouldn't do for a couple of reasons), the US could easily sell them to another foreign nation, albeit it may be at a slightly higher interest rate.
But China isn't going to stop buying US Treasury bonds because A) US Treasury bonds are one of the most sound investments on the planet and B) China's trade surplus with the US leaves them with a surplus of US Dollars, which they can only use to buy US goods, US Treasury bonds, or exchange into a foreign currency. China is far far more dependent on American consumers to buy lots of cheap crap than the US is dependent on China to finance our budget deficits.
Last edited by BigBlueBrock; 02-25-2013 at 09:20 PM.
You must hang out with the same morons I do, all business owners like yourself and not he ones sucking off gov tit. Speaking of great spending I heard sen Paul of ky say this morning that while those who think all is fine and dandy that we are spending over $2 mil to study how goldfish get along. So yea I don't worry about our economy because I know it sucks. Of course the liberals all want everyone to believe it is all the fault of those mean old seniors and the benefits they get. Which of course is nothing more than their own money that the Feds unde dems force everyone to pay into while stealing it on the other side and making sure food stamps and Medicaid get all they want and then some. Lets make sure all the illegals get benefits for free. Special tuition rates. Then throw in 24 assts for Mrs Bangs all paid by taxpayers, and how many unauthorized czars......anyone ever heard of anything they actually did......and how many vacations does this family take at costs of millions. But the excuse will be that those amounts are small little expenditure. And chuck, in your business doesn't small expenditures amount to a lot when added together? Bet those park rangers Obama is planning to lay off could have been spared with the amount it cost us for Obama to play golf while bangs went skskiing why should any business owner worry with Obama in charge?
ask your business insurance agent what businesses think of ObamaObama
Your first accusation on everything is if they disagree with you they are "ignorant" or have a "severe misunderstanding" or to question someone's resume on the subject. Does it occur to you that other very educated people with far more experience in the related area than you might just disagree and have good reasons?
Foreign nations have always held substantial assets in the US. Britain in particular. However, there is a big difference now. Those nations were investing in the US, building our economy. Now they are investing in US treasuries, federal debt, and more than half of that goes to prop up our health care system. Almost none of it goes into developing the economy. Yes I know health care is more of the budget than cellphones, in fact it's more than half the total budget depending on how you try to audit the joke the government calls a budget. Add in defense and the rest and almost none of it goes to building anything that lets us service that debt. So we borrow more.
No the average citizen doesn't know how many assets are owned by foreign companies, and they are far too reactionary about it at times, but as I said they get the basics. We're spending more in interest than we do on defense, that number is only going to rise, and that money isn't being reinvested to build something that can pay that debt down without drastic spending cuts that clearly won't happen. More spending, more taxing, more borrowing is not a sound economic strategy, and any macroeconomic approach that defends it has detached from microeconomic reality.
I know some economic views just assume the train will never end, the US will always be a great investment, we can keep starving the goose that lays the golden eggs, but it's not true and historically no nation has survived the economic policy we are currently pursuing.
so no, they aren't ignorant and I seriously doubt they are confused about how our debt is services. FWIW i know how it is serviced as well, and I know where the "foreseeable future" train of thought ends and we don't want to be there.
Last edited by CitizenBBN; 02-25-2013 at 11:59 PM.
Jazy the $2 mil for her last vacation would have employed some of those folks a while longer no doubt.
Yeah, myself and my friends are just ignorant. Particularly ironic to be accused of not understanding economics or debt service given the project I'm working on tonight. One involving quantitative systems for bonds in fact.
The problem with a lot of this thinking is it detaches from microeconomics. It leaves the basics and it loses the trees to the forest. It's why I'm such a fan of the Chicago School, b/c it doesn't abandon basic micro principles. At the micro level things are measured at the margin, the point along a curve at which change can be measured.
So we can saddle the economy nearly endlessly, borrow money from others and yes even borrow it from our own government in this sick accounting shell game (like how Social Security buys Treasuries, Enron on a massive scale), spend it all on things that don't build back our ability to sell anything to anyone else, and all will be fine. Uh huh.
Now that the SS fund and others can't soak up enough Treasuries to cover the need to borrow the Fed is buying them up. A whole nation being run like Enron. This will end well.
It's one thing to disagree with the ultimate conclusion of current policies and another to entirely misrepresent the current situation. China does not "own" the US. They don't even come close to "owning" the US and, in fact, the US consumer actually "owns" China. Foreign nations are still investing in tangible US assets, to the tune of more than 20 trillion dollars. And US firms own more than 20 trillion in foreign assets. Anyone believing and stating that any foreign nation "owns" the US because they hold some of our debt is WRONG.
And sorry, but "getting the basics" isn't good enough. Lots of people "get the basics" of lots of things, but that doesn't mean they can even come close to explaining how things work at a more complicated level. There's a reason there is microeconomic theory and macroeconomic theory, for the same reason there are theories of quantum mechanics and theories of general relativity - two schools that explain how things work on a small and large scale respectively, because principles of one generally do not apply to the other. That means that the principles that govern the spending and debt of an individual DO NOT APPLY to how governments (specifically the US) can spend and accrue debt. The same rules simply don't apply. People might like to think they do, because it simplifies the situation to a point that seems easier to understand, but that understanding would be incorrect and ultimately harmful.
However, I don't disagree that we should be spending less. I've said as much more than once. But instead of making overall meaningless cuts to non-DoD discretionary spending (that sum up to make very little difference to the overall budget), we should be looking at increasing the SS and Medicare age, and making massive cuts to defense spending - closing foreign bases; ending foreign aid to Israel, Pakistan, et al; stop buying multi-billion-dollar planes and navy vessels. Meaningful cuts that have a real impact going forward.
And historically, no nation has ever been like the United States, so using what happened in the past and applying it to the US doesn't make sense. Should we keep borrowing indefinitely? No, of course not. We should cut where we can afford to cut, invest in infrastructure in the meantime and, once the investment economy finally recovers, we cut some more. I don't believe we should engage in deficit spending indefinitely, but I also don't believe that we're teetering on the edge of some financial abyss that requires we cut spending to the bone. Do I believe in Keynesian economic principles? Yes. I'm sorry if I'm a little unwilling to run with Austrian economists and allow the economy to fall into a depression simply because they believe it's the best thing in the long-run. I don't buy that. Running policy on pure ideology is insane and dangerous.
On top of bangs last vacation was two stories on the front page of the Jackson paper this morning. Of course the first was about the budget cuts and how much it is going to hurt Americans and the state of Miss.
The second was yet another trip by bangs. She and her entourage are flying into Jackson today to meet Rachal Ray to visit a local elementary school in one of our county districts because that district is doing a good job of preparing healthier meals for trhe children, which is a great thing. So, with one article talking about furloughs for teachers, park rangers, air controllers, national guard units, etc, we also get to know bangs is spending several hundred thousand dollars to come watching the district chefs compete with the best tasting healthy lunch, while the city, country and hwy patrol have to beef up security while paying overtime to make sure bangs is safe. Take in what it costs to operate that plane, all her wonderful assts, secret service detail, the pilots of the plane, maintence of the plane, then the vehicles it takes to get them all there so she can the district great job of cooking.
And one last thing, not all the children of the school are allowed to attend. There are actually two schools side by side, lower and upper elementary, only 200 from each school are allowed, not the schools choice by told by the WH that is all that is allowed. And no parents are allowed. So which children are not allowed to witness bangs? They are being taught a valuable lesson today, only certain people count. The rest are pushed to the side.
Our day of economic reckoning is close.
And since we dont' have to worry about Europe and how it affects us, why did our stock market go down 200 plus pts yesterday because of political uncertainty in Italy?
Still not worried any longer because I have been reassured by Biden.
Like lambs before slaughter.
Cool as a rule, but sometimes bad is bad.
Biden thinks he is better informed than he actually is.
I know some economic views just assume the train will never end, the US will always be a great investment, we can keep starving the goose that lays the golden eggs, but it's not true and historically no nation has survived the economic policy we are currently pursuing.
That is a fact, and we have a few that have tried and are on the auction block today, Greece, Spain, and most recently France are up for bids.
seeya
dan
I'm just one stomach flu away from my goal weight.
The economies and governments of Greece, Spain, and France aren't relatable to the US in this case. Also, it bears mentioning that those three governments, in the face of economic disaster, instituted the same kind of austerity measures that Republicans have proposed the US implement since the Great Recession (tax cuts for the wealthy and cuts to government spending, including social welfare programs like unemployment). Whoops...
Anything that impacts any economy in the world impacts us and our economy in some way. Biden is clueless.
BBB, the economies of those three countries were much further down the pike to ruination when the austerity measures were put in place than what we see in the USA TODAY. Their dead national productivity and unsupportable social programs had put them past the point of bankruptcy prior to them taking any sort of remedial action.
I would like you to tell me why they are not relatable to the USA. If your idea is that they are part of the EU and do not control their own currency, then do yourself and me a favor and save your fingers the time it takes to type a response.
seeya
dan
I'm just one stomach flu away from my goal weight.
It's more than that. Because the ECB controls their currency and because the ECB is only concerned with interest rates and because the ECB cannot institute a different interest rate for every country and because the ECB doesn't monetize the debt of countries in the Eurozone, then the economic calamities of Greece especially are not relatable to the US. The United States has far more economic policy tools available to it than countries in the Eurozone do because they don't have sovereign currencies or sovereign debt and because the ECB only seeks to control interest rates and not unemployment. The United States is also far far more productive as an economy than Greece, France, and Spain. Add in that austerity measures only make economic recessions WORSE, and you have a recipe for the Eurozone debt crises of Germany, France, and Spain.
Actually the austerity measures in place in those countries included, not tax breaks for the wealthy, but huge tax increases on their wealth. So much so, that those native sons who built the economies of those countries are fleeing those nations and taking their taxable income with them. Many are relinquishing their citizenship in those countries and adopting new homelands that will benefit from taxing their wealth at a much lower rate,
seeya
dan
I'm just one stomach flu away from my goal weight.
I'd misread, they actually cut taxes on low income earners. At any rate, cuts to government spending in the face of economic recession doesn't work.
Income taxation at the rates imposed by some of those European countries have accelerated their decline. Most of our states that are more economically stable have NO income taxes.
It has in the US in the recent past. When their was a slight recession in Bush I's tenure it was turned around when Clinton and Gingrich worked together to cut the budget and get a better handle on U.S. deficits.
Where does the money come from to continue to fund the government spending? Borrowing? If so, you mentioned that the ECB was only concerned about interest rates, but the problem is the borrower is at the mercy of the world market for currency and that supply sets the rates. The ECB can set their own rates much like the Fed is doing in the USA with ridiculously low rates in house, but new money has to come from somewhere to continue the operation.
Just like the countries I mentioned, the USA is playing a shell game with the money, and the only thing that will fix the malaise is private investment. Without it, we will be sold to the highest bidder.
seeya
dan
I'm just one stomach flu away from my goal weight.
You'll have to forgive my ignorance on that, as I was but a child at the time. But how did Clinton and Gingrich fix a recession that started and ended in the middle of Bush 41's presidency, nearly two years before Clinton would be sworn in?
Borrowing and taxes revenues are the only two ways you pay for government spending. And your problem with the ECB is correct, but that's only a Eurozone problem. The US doesn't have that problem because the Federal Treasury can, as it is colloquially known, print money. They monetize the debt (buy up US Treasury bonds) themselves, credit the government's account (for lack of a better way to put it), and that's how we partially finance deficit spending (the rest comes from foreign governments buying US Treasury bonds).
Keynesian economic policy (deficit spending during recessions) isn't meant to be taken into the future ad infinitum. PART of the reason why deficit spending seems so bad now is because Dubya racked up TONS of new debt when he cut taxes on the wealthy AND started spending out the wazoo on two wars and a horrible Rx program. You manage deficit spending during recessions because private investment isn't there and, to make up for it, you get public investment (in things like infrastructure, which the US badly needs). At the same time, you hold down interest rates and try to keep consumers spending (70% of the US economy) in order to kickstart private investment. Once private investment picks up, you reduce government spending as much as possible to run surpluses in order to pay off the debt you accrued previously. You also increase interest rates to keep inflation manageable once the economy is churning. All of that is what we should be doing, in my opinion.
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