O.T. Moody’s Investor Service, might cut the US credit rating

Can you be a bit more specific? No I do not worry about that, I am more worried about the recent US attack in Syria. It is all about israel again, trump's son in law I'd think, his financiers. Well his lawyer is in jail for 3 years, maybe trump should be next.

trump is just a ruthless weapon sales man, that gives him support from corrupt generals who suck taxpayers for money for useless mil stuff, and THAT is why there is a deficit.

If you believe that you should be able to show it easily. Where are your numbers?

Rick C.

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John Larkin         Highland Technology, Inc 

lunatic fringe electronics

The sad fact is that if enough people make enough predictions, some of them will be right.

It is of course ludicrous that big-name economists missed the 2008 housing crisis, which was mostly caused by government policy.

Ecomomists are, on average, useless or probably less.

The world is chaotic so not very predictable.

Commentators are already complaining about the lack of short term "stimulus" from the tax changes. They don't understand time constants, specifically how long it takes to build a business. And why productivity matters.

They especially don't understand that business tax cuts might result in less visible savings and investment and not transient public consumption "stimulus", travel and restaurant meals and junk like that.

My company is saving most of the corporate tax reductions, which will tide us over any slow spots and enable future investments.

--

John Larkin         Highland Technology, Inc 

lunatic fringe electronics

Another useful rule of thumb is when you read something like, "a panel of

40 eminent economists have all agreed that...." You can bet your bottom dollar that whatever the prediction is, it'll be wrong. I can't remember a single time such predictions have ever came true during the last half- century. I concluded that these people are for hire and will say what ever whoever's paying them wants them to say. Same goes for climate science and a whole bunch of other things.

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And the liberal economists were right. Freddie and Fannie were backing loans made under the Community Reconstruction Act, and the investigations after the sub-prime mortgages crisis found that these loans hadn't gone bad.

What caused the sub-prime mortgage crisis was irresponsible lending by fringe banks, and the mortgages that those banks made went bad in droves.

James Arthur posted a lot of nonsense just after the sub-prime mortgage crisis blaming Freddie and Fanny, and I had lot of fun jeering at him a few years later after the investigations had been completed and published.

If you are as pig-ignorant as Tom Del Rosso you can make any number of absurd claims.

The nice thing about predictions is that there are always enough of them to allow you to find the one that suits your argument.

In fact it was tested - by Reagan - and proved wrong, but Tom Del Rosso is too disconnected from reality to be aware of this.

--
Bill Sloman, Sydney

In the sense that government didn't do anything to reign in irresponsible lending by fringe banks. The lending where the government did have a say - via the Community Reconstruction Act and Freddy and Fannie - didn't go bad in the same way.

As if John Larkin would know.

And there's no shortage of predictions - at least one for every possible outcome.

The reality that Tom Del Rosso has failed to perceive is that Reagan tested that prediction, and it didn't work.

None of which has anything to do with the consequences of a deficit-funded tax cut.

They might, but government spending still has to be paid for, and that money has to come from somewhere.

The slow spots which Trump is engineering with his trade war with China. That crimps the world economy (which does include the US). Investing to exploit a shrinking market isn't a popular activity.

--
Bill Sloman, Sydney

n

John Larkin doesn't know enough about economics to have any opinion worth r eading.

Cursitor Doom is even dumber and more gullible, and even less worthy of att ention.

g the last half- century.

Will Hutton's economics column in the Guardian had a whole string of predic tions that came true. It was an easy job - Thatcher monetarist economists w ere doing silly things that weren't going to have the effect they wanted to achieve, and Will Hutton's Keynesian academic friends didn't have any trou ble predicting the effect that they'd actually have.

Put a bull in a China shop makes it easy to predict breakages.

It's more that people who hire them chose who they hire on the basis that t hey like the particular kinds of predictions and advice they get.

Climate scientists aren't hired by politicians.

The kind of "scientist" hired by the people who churn out the denialist non sense that Cursitor Doom and John Larkin take seriously, are hired for thei r willingness to put together nonsense to delude the gullible, but that's a branch of public relations.

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Bill Sloman, Sydney

So, your response is NOT a 'boost to the economy', just padding a savings account. Guess that didn't work out like it was supposed to...

Savings, unless it's gold bars under a matress, becomes investment. You can't just spend your way to prosperity. Some proportion of production has to be deflected from consumption into investment, and businesses tend to do that better than individuals.

Run a business and see.

Stimulus is like shooting speed; the rush is short-term.

--

John Larkin         Highland Technology, Inc 

lunatic fringe electronics

I suppose you have no idea this statement invalidates everything you just p osted about building a business, time constants, etc. You are using the ta x cuts to maximize your personal wealth with little benefit to anyone else in the country. So why did we cut the taxes again?

Rick C.

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WHOOOSH!!!

(The sound of economics going over the left's head.)

If it directly benefits him then he's not the only one to benefit directly. It doesn't have to benefit others through him.

WHOOOOSH again!!!

Savings IS a boost to the ecomomy.

The left thinks they don't believe in Marxism, but you do believe that capital can't create wealth.

Tom Del Rosso isn't left wing, but most economic logic goes over his head too.

Make up your mind. If he's not the only one to benefit directly then others have to be benefiting through him.

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Bill Sloman, Sydney

Not unless they are invested. Leaving them in the bank is an investment of a sort - the bank can lend the money to other people - but the return is very low.

Capital has to be invested to create wealth. Marx was well aware of this but others had worked this out long before he got involved.

I'm afraid Tom Del Rosso's grasp of what Marxism might be is as weak as his grasp of every other aspect of economics.

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Bill Sloman, Sydney

The salient feature of savings, is that it's SLOW to become investment, because of reserve requirements. If you'd hired new help, or paid the tax and got roadwork improvements, there's be higher multiplier (turnover) this year for each dollar.

Snowstorms aren't always weather: you can create 'em with bafflegab. But you knew that...

Indeed, one of our finance politicians did that, predict (the wrong) interest rate change, he was promptly promoted to lead some US bank a few month later,

I did post about that at the time...

Actually, savings do boost the economy, many times over.

The "many times" used to be limited to 8, if I remember correctly from 40 years ago. More recently it has been up to 50.

The debate is what multiplier to choose/allow.

Almost all these kind of top jobs are granted to incompetent politicians as payback for political favours formerly rendered. The posts have no function; those who occupy them are only notionally required to 'work' for the institution concerned, typically for an hour a month as a "consultant" just to make it appear legitimate. I'll bet the Clintons - to take just one example - have a million different consultancy jobs between them. It's a racket.

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