OT: Goodbye to the American Dream

On Sun, 30 Aug 2015 10:05:05 -0700, John Larkin Gave us:

Nice try, retarded punk.

...or Enron.

I only bought IBM stock when it was unrealistically depressed. when I bought, I was never in for more than a year, or so. As you note, there is too much risk having one's whole life wrapped up in one company. ...even one that is a member of the Dow.

Ah, but the house doesn't cost more. The difference is the land and the two properties are *not* the same.

t they are richer than the rest of us, and this makes all the social gradie nts steeper, which doesn't seem to do anything good for the rest of us.

ealth and certainly do not say I am richer than the rest of us. For one th ing, I worked in the Seattle area and know several of Microsoft people. And while they do not emphasize their wealth, I am sure it is more than mine. I do try to point out that one can become rich without too much effort an d without needing a silver spoon.

That's not got anything to do with what I was claiming, and it's just more anecdotal evidence (and not a lot of it). You would need to read the book, though it doesn't look as if you've got the attention span to cope with any thing longer than a paragraph.

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Bill Sloman, Sydney

Haven't you just contradicted your own definition of 'rich'--having more than others?

I like this second definition better, money doesn't make unhappy people happy. It almost seems to make them unhappier, and more desperate. I've seen that, many times.

There's a third possibility too--I've been around the world, and spent almost nothing on it.

I've seen people struggling to eat (invariably due to defective notions of government and politics, e.g. Zimbabwe, devastated by 'redistribution').

We're all rich. Ask /them./

Cheers, James Arthur

So you are a proponent of wealth redistribution?

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Rick

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s luck, but mostly just recognizing what companies seemed to have their act together and buying their stock. I bought Texas Instruments, John Fluke, IBM, Hexcel, and others. And bought S & P 500 index funds in my 401K . I also bought a little Nucor stock when it was Nuclear Corp of America. Shou ld have lost my ass on that, but it turned out okay.

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Investors aren't entirely rational.

shared a Nobel Prize - admittedly in Economic - for spelling out how.

Keynes made the same point rather earlier, and made a very persuasive case for the Feds (and their ilk) to spend money on fooling investors into think ing they were richer than they were, during recessions, where everybody goe s around thinking that they are poorer than they are (with lethal effects o n economic growth).

You don't understand any of it, and have been known to claim that they thin k that fooling the investors into thinking they are richer works all the ti me (when more sophisticated observers are aware that once the economy has m oved out of recession, this delusion can become exaggerated to the point of blowing up a bubble).

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Bill Sloman, Sydney

I'm not sure what that means. Are you suggesting that without Bill Gates we would not have Windows?

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Rick

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The bill for the 1930's non-stimulus - the Great Depression - was a 25% red uction in GDP. Industrial production didn't get back to the 1929 level unti l 1937, then took another hit when James Arthur think-alikes prematurely cu t back the stimulus, after which it fell and didn't recover until 1939.

That was probably about one GDP*years worth of lost production.

You pay your money and you take your chances, but the US economy hasn't act ually shrunk (except for about one quarter, before the stimulus got going) since the GFC.

Bastiat wouldn't have liked it, so James Arthur doesn't believe in it.

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Bill Sloman, Sydney

I was there. At one point - around 1980- we told management that the 8086-based computer we were working on - as a communicating word processor - could sell well as a general-purpose office computer.

The sales guys looked into it, and figured that they could have sold about 150 to their usual customers. Since our hardware was a bit more powerful than the original IBM PC, and engineered for 10,000 per year production, they were probably wrong.

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Bill Sloman, Sydney

Without Xerox PARC we wouldn't have Windows. If I remember rightly, Steve Jobs copied that idea on a cheapish comnputer long before Bill Gates did his me-too.

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Bill Sloman, Sydney

Are you sure you didn't mean "large heavy things you could *depreciate*?" :-)

That much today can be done without those should be boosting innovation a lot more than is actually the case.

On the other hand it's considerably more daunting just to fill out all the government paperwork today, and potentially disastrous to fatal if you miss something.

A local business just got fined 2x its net worth for a technical infraction by the EPA, a year AFTER the business closed. Of course they're the agency whose administrator said their strategy was to crucify a victim or two, like the Romans

and the victim here was someone who'd opposed them.

That's the problem, or at least an aspect. The feds frighten people.

Sure. As is the value of organizing a group of good people, and the value of a good name, a reputation for quality, and doing what you say. All of these have real value--can even be estimated--and factor into a company's actual worth.

Where you can estimate these factors, you can tell if shares in a company are reasonably-priced, or not.

The heck you say! I follow Obamacare closely. The lack of good information and the geysers of misinformation and dissembling from the top are very damaging. The People can't make good decisions without honest information.

A lovely big-government, political response to a hobgoblin they mostly created themselves (Enron). Auditors for the auditors, overhead for all.

And of course the government offers no such disclosures, nor meets any such standard. (They don't list basic liabilities on their balance sheet, and routinely lie about future prospects!)

We don't have any GDP growth to speak of, and real wages are down.

All that money 'created' is supposed to represent actual goods and services already produced, yet those goods and services were never produced. Therefore, people wanting to trade their dollars for goods and services must eventually discover their vouchers can't purchase what was never made--there's no avoiding that.

Debt's a big drag on a nation for the same reason it's a big drag on an individual--debt service siphons off part of your earnings, making them unavailable for investment, plus you owe interest too.

In WWII we went deep in debt to save civilization. Now we've done it... for nothing.

That's just another failed obfuscation. Do you disagree that funds are fungible? Or that the Ben Bernank's declared intention was to stimulate the economy? Which he then thwarted by paying interest on reserves, making banks billions for hiding his dirty laundry? What a web we weave...

Complicated. There are lots of extra funds due to meddling (QE), yet not circulating due to more meddling (interest on reserves, other regs., a.k.a. 'financial repression'.)

I think the panic-making arbitrariness of it all is as damaging as the stupid policies behind it, and the spending that made it necessary.

Oh, I think it's simpler than that. Businesses plainly see that all this spending and debt represent future taxes, lower earnings and growth, and are planning accordingly.

That's what happens when someone borrows a lot of money on your behalf that you'll soon have to start paying off over time, and the shell games don't change it.

Cheers, James Arthur

I agree with nearly all your comments on investing, but Yellen's dilemma is extremely obvious, public, widely discussed, confirmed, and anticipated.

How does anyone--even a government--pass $4 trillion dollars in funny money? That's the question.

Cheers, James

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Search on "hyperinflation". There have been plenty of examples of that.

The Feds "prevent the Great Depression" package doesn't yet seem to have pr oduced any inflation worthy of the name, and tapering it off seems unlikely to anything interesting either.

The James Arthur "rerun the Great Depression" scenario would have produced

25% deflation (to the great advantage of those - like James Arthur - with c apital reserves) but it would also have dismantled about 25% of the real ec onomy, which isn't a good idea, since you can't rely on the good stuff surv iving.

The real problem here is that James Arthur doesn't believe anything about e conomics that post-dates Bastiat (who died in 1850) and doesn't actually ha ve a clue about what's really going on.

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Bill Sloman, Sydney

Ya, especially if it's because millions buy a product with their money, the company does well financially and I get money because I own a part of that company. That's good wealth redistribution!

I think it's good for society when families can save and invest their money to make more money, so in retirement they can support themselves.

Your comment went over my head, so please explain how you pulled wealth redistribution from personal saving and investing.

Mikek

The 30's were nothing but 'stimulus' starting with Hoover (playing George W. Bush to Obama's FDR). That created the Great Depression from what should have been a transient panic. Rent-seeking, Smoot-Hawley, and chiefly, unstable lawless government & federal deficits, terrorizing production and borrowing from future prosperity. Same same.

Actually that's another myth. Stimulus, being artificial, never lit the fire it was supposed to light. As soon as the money stops, instant withdrawal and retraction, as you've just acknowledged. (If it had worked, it wouldn't have needed until 1937 to ignite a self-sustaining recovery.) We just had the same experience with Obama's wasteulous, and Japan's been mired in it since the late 1980's.

We've paid something like this time. We're roughly $2T GDP below trend from the resultant slow growth. Integrate over six years, then add the $4T in funny money piled up, and factor in the debt load against future prosperity. Completely unnecessarily, ineffective, and for nothing.

Nice work Barack!

Hey, you learned to spell Bastiat! Maybe some day you'll be able to formulate a criticism, and won't need to depend so heavily on plain slander.

Cheers, James Arthur

Why would you even express an opinion when you haven't a clue when I bought my house. Seems to me your dumb to do it and then you showed your dumb because you were wrong. That's kinda dumb. Think before you write next time, Dummy, Sheesh.

Mikek

It's actually not wealth distribution. Rick's confused wealth creation with redistribution.

If you have a pile of axe-handles and I have a pile of axe-heads, just about anything that acts to combine or facilitate combining those *creates* something new, additional, and valuable--axes. Wealth.

If I paid you for some axe handles, we're both better off. Wealth has been

*created*, and the benefits of the increase split between the parties according to their mutual agreements.

If you or I started a company dedicated to that--assembling, combining, or producing axes--and people wanted to invest in owning part of our ventures, we all benefit if our venture succeeds.

Wealth redistribution is when a strongman of one sort or another empties your wallet and spreads it amongst his friends. That's zero-sum. Less than zero-sum, actually, as the second-order effects terrorize and discourage wealth producers from producing.

Cheers, James

I just wanted to be sure you are pro-wealth redistribution.

Your comments seem to be that it is good for families to make money. Why is saving and investment a necessary condition for this to be good? Aren't there other ways to make money? How about if families get training in card counting and make lots of money at casinos, enough before they get banned that they can retire early? Would that also be a "good" way to redistribute wealth?

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Rick