economists are idiots

I consider workman's comp rates, and taxes on businesses, to be microeconomic issues. Microeconomics is what real individuals and real businesses, especially small businesses, see day to day, the things that determine whether they hire and fire, grow or die. Microeconomics is the checks that we have to write every month.

Few economists or bankers or politicians care about their citizens at that level. They mostly pass laws that discourage employment. They turn the big knobs and fling billions and trillions of dollars around with no attention to the thousands and millions that add up to the trillions.

Try clearing the airway.

Cheers

Phil Hobbs

The problem with borrowing money is that you have to pay it back.

The US has tried the same strategy to encourage banks to lend to businesses. It's mostly not working.

San Francisco is now the most expensive city in the USA. Lots of Asians are buying condos based on floor plans and wall paneling samples, for numbers around $2000 per square foot.

Here's a short video of what is happening in Frances because of Taxes.

Mikek

Den torsdag den 5. juni 2014 23.44.24 UTC+2 skrev John Larkin:

yes, but you need money to make money, unless a company has a pile of cash or can get customer to pay in advance the need credit

-Lasse

I consider it macroeconomic because this was clearly caused by political pandering to unions and lawyers. It affects a whole state of 30 million people.

That is one of them.

Like giving Calpers the keys to the vault and unfettered power to confiscate money. That will thoroughly destroy the minicipal bond investment climate in California. Who in their right mind would invest in that nowadays? Now it's only a matter of time until we see our own little Detroit here.

It does not encourage anything other than an outflow of money. How is that going to be good for European companies? Yeah, it can create jobs. In Asia.

Correct.

Not only in France, people from other countries have left as well.

But now with Obama it's not much better in the US except that we have the chance to prevent too much additional longterm damage with the next election, and then ultimately with the one in 2016. If voters still don't get it then we'll head in the same direction as France. And the Roman Empire. And ...

Hard as they try, the solutions aren't in the central bankers' domain. They're just papering over the problem. With paper.

To pierce through several layers of abstractions, at bottom the problem is that, for various reasons, people aren't making and doing stuff. The enterprise death rate has spiked up, and the birth rate is well below the death rate. People aren't trying. The country (America) is dour, morose, defensive. (Except me. I'm having fun! :)

It doesn't have be so--it's coming from the top.

The U.S. economy has been chomping at the bit to come galloping back, but keeps getting kicked in the teeth. Fracking, in spite of the govt's best efforts to squash it, is the *only* thing keeping us above water.

It wouldn't be hard to fix. Drop the corporate income tax rate, or eliminate it. Repeal Obamacare. Eliminate the IRS. Or just simplify the tax system to one or two flat rates, no nonsense.

Any one of those would do.

The real root of our problem (U.S.) is that the government has promised far more benefits than it can possibly ever pay, and things that are unsustainable do not go on forever--there will come a reckoning.

It could be orderly--a few extra points of inflation for a decade--or it could be disorderly, no one knows.

Cheers, James Arthur

Moreover the buyers driving this rise are cash on the nail types who have found the art market returns recently somewhat less reliable.

Not sure what Tokyo prices are like today but when I lived there our favourite noodle shack in downtown Nihonbashi was valued at 5MY /m^2 which at the time seemed an insane $4k5 per sq ft!

ogy, Inc jlarkin att highlandtechnology dott com http://www.highlandtechnol ogy.com

Works like a charm. The banks get richer every time. there is no downside f or the banks. It's like being staked in a poker game and you do not have to pay it back if you lose. Simple win-win.

They don't bother to look so good over here, they just take it, and then ta ke it again, and then take more. Your banks have to go through more shit be cause they haven't filed the governments with total fuckng idiots who would sell out the world for five bucks.

As far as the interactions between banks and central banks are concerned, there's nothing very special about the 0% deposit rate, and nothing fundamental changes when rates move from positive to negative.

There's an opportunity cost for banks when they don't lend money, in that they don't get interest on that money. Banks balance that against the risk of lending it (which is that the borrower never pays it back).

The central bank has reduced the deposit rate in order to increase the opportunity cost of not lending. As it happens, the reduction has moved the interest rate into the negative, but nothing in particular turns on that.

Whether it will have the desired economic effect is another matter, but that's always true of interest rate movements.

Sylvia.

Europe is many countries some doing well, some OK, some scraping by and a handful of basket cases. The Euro zone will wake up with a severe headache if Germany ever gets fed up with bankrolling the laggards.

It has always been like that since forever. The UK banks were never interested in small hitech start ups and US led venture capital was the best approach at least as far back as the 1980's. I got to meet Evans & Sutherland the simulator makers as a result of our initial funding.

We did actually have a good bank manager but he was never in a position to offer us a loan on better terms than our venture capital sponsors. Interest rates back then were well over 10% pa. ISTR peaking at 15%.

The present situation is perverse. Major players are sat on huge cash piles trying to decide what to do with it. Interest rates are low but perfectly good small businesses cannot obtain bank loans to invest in new kit and expand their business. It is a recipe for stagnation.

UK is doing well at the moment despite its miserable bankers who have been manipulating just about every market statistic for personal gain.

It has always bothered me how discontinuous and piecemeal all accounting and taxation is. It's almost like they want to add nonlinearities to make the system even harder to understand and more chaotic. From a controls engineering perspective, this is abhorrent.

Of course, they're all based on principles and traditions going back centuries, long before calculus was even invented, let alone understood in the context of markets and economics (such that our current economic understanding is).

On the plus side, at least there is *such a thing as* continuous compounding (i.e., mathematically continuous exponential growth). Not that it can be paid off in the same fashion...

There's a thought. Time-continuous banking. No problem for networking and computation today. A little harder to think about offhand, but the average person doesn't understand a lick of accounting anyway, so what difference does it make, right? Anyway, suppose as soon as I enter work and clock in, my account starts going up. At a rate fixed by contract. Well, that's what hourly wages do anyway, but those are integrated and sampled every couple weeks.

So why not sample daily, or even instantaneously? By telling the bank account you're earning money (or spending it, or both!) according to a particular specified function (and this could include most arithmetic and elemental functions), you don't need high bandwidth, just the communication of timestamped events. No need for recording hours manually, that's implicit in the system.

And with a Dirac delta option included, it's completely backwards compatible with the current system.

Of course, banks would have a much harder time rearranging your deposits and withdrawls so that they can say you've overdrawn.

How would such a system work? What does the tax man get out of it? Well obviously, it would have to be centralized, so they just take whatever fraction or function off whichever transactions they choose. No more need to report income and expenses, it's all done automatically online. Don't worry that the fed sees all your functions and timestamps, you can trust them...

Tim

The cash float goes away, is why not. I recall vividly when IBM went from weekly paycheques to semi-monthly. We were all being forced to give the company a loan of a week's pay, repayable theoretically when we left.

Cheers

Phil Hobbs

But it is precisely that sort of parasitism that saps the economy. 'Big finance' does it on an even grander scale --in fact, it's their

wealth.

Jeroen Belleman

Don't expect this to work. It would need a bankers can do real math. I have experienced several who cannot add up numbers with varying signs.