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09-16-2011, 11:23 AM
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#161
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Administrator
Join Date: Jan 2008
Location: Chicagoland
Posts: 40,725
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Quote:
Originally Posted by Gone4Good
Which is exactly what we want.
Viewing economics as a morality tale often leads us to wrong conclusions. Market economies have one function, to allocate resources. As much as some would like to think otherwise, their purpose is not to reward the virtuous and punish the wicked. The economy doesn't care.
If only the indebted suffered, one could make the argument that doing nothing was just. But that isn't the case. As just one example, the unemployment rate for recent college graduates is at the highest level since the 1970's. 22 year-olds didn't cause this problem, and yet they suffer. And they'll continue to suffer if we pretend that the economy is dolling out justice, when all it is trying to do is allocate resources in the face of a broken pricing mechanisim.
My thoughts are that we need to fix the economy by fixing the pricing mechanism.
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No morality intended. We should avoid encouraging a behaviour which is destructive for overall economic performance. The "sufferers" should be those that borrowed beyond their capacity to pay and those that lent to uncreditworthy borrowers.
The 22 year olds, like everyone else, are out of work because there is insufficient aggregate demand in the US and their price of labor is globally uncompetitive. Borrowing to finance a fiscal deficit may employ them but it also returns us to the same behaviour that led to this problem in the first place. At some point the US, both households and public sector need to live within our means.
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09-16-2011, 12:18 PM
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#162
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Thinks s/he gets paid by the post
Join Date: Sep 2006
Posts: 1,691
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Quote:
Originally Posted by MichaelB
The 22 year olds, like everyone else, are out of work because ...
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If I was a 22 year old and couldn't find a job I would join the military.
You get paid, you get experience, and you get benefits for the rest of your life, not mention you can serve your country.
It's a win-win-win
TJ
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09-16-2011, 12:29 PM
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#163
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2005
Posts: 17,242
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Interesting article on deleveraging...
Households making progress on deleveraging - MarketWatch First Take - MarketWatch
"The root cause of the financial crisis and the great recession that followed was excessive household debt, which doubled from 2000 to 2008, peaking at nearly $14 trillion. Full recovery can’t occur until that debt is no longer excessive. "
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09-16-2011, 12:42 PM
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#164
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Sep 2005
Posts: 5,381
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Quote:
Originally Posted by teejayevans
If I was a 22 year old and couldn't find a job I would join the military.
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You aren't the only one . . .
Army Exceeds Recruiting Goals
Quote:
In the active component, the Army sought 54,200 recruitments through July. It gained 55,131 -- 102 percent of its goal. The active Navy, Marine Corps and Air Force all hit the 100-percent mark. The services are also on track to meet their yearly retention goals, according to the release.
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I'd like to see statistics on how many people applied and were turned away, versus say 2007.
__________________
Retired early, traveling perpetually.
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09-16-2011, 12:46 PM
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#165
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2005
Location: Lawn chair in Texas
Posts: 14,183
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Quote:
Originally Posted by teejayevans
If I was a 22 year old and couldn't find a job I would join the military.
You get paid, you get experience, and you get benefits for the rest of your life, not mention you can serve your country.
It's a win-win-win
TJ
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However short it may turn out to be...
__________________
Have Funds, Will Retire
...not doing anything of true substance...
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09-16-2011, 01:57 PM
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#166
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Thinks s/he gets paid by the post
Join Date: Oct 2010
Location: Waimanalo, HI
Posts: 1,881
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Quote:
Originally Posted by Texas Proud
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It is interesting. Rex asks:
Quote:
Remember the generation that wouldn’t even go into debt to buy a new car, much less a vente mocha latte with skim milk?
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Who is he talking about? Me? (Born in '42, and I've never bought a new car, nor gone into debt to buy any car. Hate debt.)
__________________
Greg (retired in 2010 at age 68, state pension)
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09-20-2011, 11:21 PM
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#167
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2008
Posts: 7,438
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09-21-2011, 06:15 AM
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#168
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Thinks s/he gets paid by the post
Join Date: Sep 2006
Posts: 1,691
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Quote:
Originally Posted by explanade
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The Nobel prize is a political award and is almost meaningless.
See latest news about the fed wanting to do more monetary trickery to get us to leverage up, while the rest of us are trying to de-leverage. Clearly we have a disconnect between us and the economists with PHDs from the ivy league schools.
TJ
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09-21-2011, 06:42 AM
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#169
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2006
Posts: 12,483
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Quote:
Originally Posted by teejayevans
The Nobel prize is a political award and is almost meaningless.
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+1
Quote:
See latest news about the fed wanting to do more monetary trickery to get us to leverage up, while the rest of us are trying to de-leverage. Clearly we have a disconnect between us and the economists with PHDs from the ivy league schools.
TJ
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The Fed is drunk with power..........
__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)
This Thread is USELESS without pics.........:)
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09-21-2011, 06:46 AM
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#170
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2006
Posts: 12,483
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__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)
This Thread is USELESS without pics.........:)
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09-21-2011, 07:35 AM
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#171
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2005
Location: Chicago
Posts: 13,186
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Quote:
Originally Posted by teejayevans
the fed wanting to do more monetary trickery to get us to leverage up, while the rest of us are trying to de-leverage.
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Yep...... Unless we have some unanticipated technological breakthough regarding energy or food production, it may be time to realize that the growth days here on planet earth are over and it's time to make the best of and conserve what we have left. Im content to see things level off in terms of both population and economic production. The fed seems intent on stimulating growth fueled by additional borrowing.
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"I wasn't born blue blood. I was born blue-collar." John Wort Hannam
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09-21-2011, 08:11 AM
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#172
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2005
Location: Lawn chair in Texas
Posts: 14,183
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Quote:
Originally Posted by youbet
Yep...... Unless we have some unanticipated technological breakthrough regarding energy or food production, it may be time to realize that the growth days here on planet earth are over and it's time to make the best of and conserve what we have left. Im content to see things level off in terms of both population and economic production. The fed seems intent on stimulating growth fueled by additional borrowing.
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Good luck with that...
I would argue, though, that the FRB is not so much trying to stimulate growth as it is trying to prevent disinflation.
__________________
Have Funds, Will Retire
...not doing anything of true substance...
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09-21-2011, 08:24 AM
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#173
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2005
Location: Chicago
Posts: 13,186
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Quote:
Originally Posted by HFWR
Good luck with that...
I would argue, though, that the FRB is not so much trying to stimulate growth as it is trying to prevent disinflation.
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I suppose you could make that case and I respect your opinion. I'll stick with my opinion that they're trying to stimulate growth and will likely become more and more aggressive in that regard unless political tides stop them.
__________________
"I wasn't born blue blood. I was born blue-collar." John Wort Hannam
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09-21-2011, 09:15 AM
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#174
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2006
Posts: 12,483
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Quote:
Originally Posted by youbet
I suppose you could make that case and I respect your opinion. I'll stick with my opinion that they're trying to stimulate growth and will likely become more and more aggressive in that regard unless political tides stop them.
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+1 Right now I think the Fed is more powerful than Congress, they act like we should all genuflect at the feet of Ben Brenanke and his "computer models".............
__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)
This Thread is USELESS without pics.........:)
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09-21-2011, 10:22 AM
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#175
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2007
Location: New Orleans
Posts: 47,500
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__________________
Already we are boldly launched upon the deep; but soon we shall be lost in its unshored, harbourless immensities. - - H. Melville, 1851.
Happily retired since 2009, at age 61. Best years of my life by far!
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