We are a commune of inquiring, skeptical, politically centrist, capitalist, anglophile, traditionalist New England Yankee humans, humanoids, and animals with many interests beyond and above politics. Each of us has had a high-school education (or GED), but all had ADD so didn't pay attention very well, especially the dogs. Each one of us does "try my best to be just like I am," and none of us enjoys working for others, including for Maggie, from whom we receive neither a nickel nor a dime. Freedom from nags, cranks, government, do-gooders, control-freaks and idiots is all that we ask for.
Our Recent Essays Behind the Front Page
Wednesday, February 25. 2015
Continue reading "New York is a Dying City"
Friday, February 20. 2015
In our nation, we have taxation with representation. However, given the size of our current debt, and the length of financing being pushed out to 20 and 30 year bonds, much of the repayment will be provided by another generation.
This generation, of course, has no say in the introduction of debt, and this is a fairly common theme when the size of our debt is discussed. However, I've seen relatively few people discuss the political implications of forcing taxation without representation on these future generations.
Is there a moral issue related to deficit spending, over 20 to 30 years, since it is essentially taxation without representation? I think there can be a strong case made, though I've never seen it discussed. Has anyone else?
Wednesday, February 18. 2015
From my perspective, a college degree is good for a few things. These are not limited to: expanding one's view of the world, improving one's own process of inquiry and learning (my father's old line is you go to college to get an education, not to get a job), and to become technically proficient in a variety of specialized fields where proficiency is otherwise difficult to achieve. I'd toss in that it's also a means of networking and learning social skills to improve future prospects in both life and work.
College is not the only place to learn these things, though it's probably one of the better places to learn them. You could say the same for the military, in some respects. Be that as it may, limiting one's view of a person's potential and capabilities to very specialized qualifications, such as college or military backgrounds, is a bit odd.
Mike Rowe explains why:
Continue reading "Mike Rowe on Qualifications Versus Competency"
Monday, February 9. 2015
I never saw the need, or use, for Google Glass. People who had them were weird, a bit stuck-up, and their quirky behavior was not a selling point. It's no surprise to me that the entire project fell apart over differences in marketing, but the addition of an illicit affair just makes the story that much more interesting.
There are a few things to take away from a story like this. First, keep it platonic. I've never felt there is a good reason to get involved with anyone you work with. I have a hard enough time with people in my own industry, having to date someone at the same company would be murder. The old "Don't crap where you eat" are words to live by. Second, it's clear Google is not without its imperfections. Those who think Google is becoming a monopoly or overly dominant have some legitimate fears. Perhaps those fears are overblown, though. Back in the 1980's a friend of mine used to say "Someday, we'll all work for IBM." By 1995 it was "Someday, we'll all work for Microsoft." Today, you can figure out who we're all going to work for. I doubt it. Google is very good at what they do, but there are no guarantees they will take over everything. Finally, while I don't see any reason to dislike the idea of Google Glass, I just don't see the fit today. Apple's Newton was about 10 years ahead of its time, but there is clearly a market for handheld computing. Maybe computing glasses will make a comeback. I wouldn't be hopeful, but I don't see why they can't be the next thing, either.
Want an idea of how big Google is? Submitted for your approval, a video that has a tinge of conspiracy paranoia, but is completely clear in its intent to just show you everything Google is doing without making judgments.
Sunday, February 1. 2015
My fraternity had a summer paper that we mailed out to members. Its motto was "All the sh*t that fits, we print." This has been the motto of the IPCC for quite a long time.
Thursday, January 29. 2015
I am astounded that there are still people, even family members of mine, who truly believe government is here to do good things. I've ceased to be fooled by that illusion.
Wednesday, January 28. 2015
When they lived at home, I'd try to convince my less intrepid boys to do the same thing, to no avail (some of us have that entrepreneurial gene, others don't). As much as I enjoy the effort of digging and spending time outside, I was pleased to see younger folk scrambling for a buck. I paid them $30 and they cleared the walk and driveway in about 40 minutes. I don't even have to listen to people complain that I didn't pay minimum wage. Though if I'm ever up for public office this may haunt me as I didn't pay their taxes.
What really surprised me was they asked for my phone number, in case they get another snow day they can call to ask if I need to be shoveled. After checking with their parents, I agreed to give them the house number. Norman Rockwell is not dead, no matter how much our politicians try to kill his vision of our nation.
Friday, January 23. 2015
I may have misinterpreted what Mr. Ma said, but his comment was something to the tune of "If you have a billion dollars, it's not just yours. It became yours because the people who gave it to you felt you would do better things with it than anyone else, like the government. This places a responsibility on the person with a billion dollars, and is why I will seek to do good with this money."
As I said, I may have not heard it precisely or interpreted it correctly. If I did, it is a view I agree with(although people didn't give him anything, they exchanged money for a product or service he provided which made everyone better off).
All told, I'd prefer to not have a billion dollars in wealth. Too much responsibility, too many headaches. People who amass fortunes like this, however, have made the world better and this is why I don't oppose or envy their wealth. As Ma intimated, they can do better with the money. This is one reason I enjoy watching shows like Shark Tank. Not only do I learn insights on how to manage a business, but I see wealth at work producing things people want or need.
People who believe the wealthy sit around pools drinking margaritas all day (I've had people say this to me) have no idea where wealth comes from or how it is made. Those people may exist, I'm certain they do. Their wealth, however, does not last as long as you'd think. Their money must be working at improving lives through exchange or production, somehow, for them to spend the rest of their lives poolside. Real wealth creators, however, are always doing good with their money, even if it's just managing their companies (which provide jobs, goods and services) or coming up with new ideas that people want or need.
By and large, I believe if you're smart enough to earn the money through productive or creative capacity, as Jack Ma did, you're likely to know what to do with it. If you lucked into it, you're unlikely to have a good idea of what to do without some professional help.
Then there is a third group I forgot to mention. Politicians. I believe they are more like lottery winners, though they believe they are producers. I see them as popularity contest winners who are handed a blank check and haven't a clue what to do.
Thursday, January 22. 2015
So when I think about what the President had to say, and specifically who he was speaking to (because he did not speak to me or people like me), I think of another movie, one involving an entrepreneur who built a business and was seeking to keep it running by giving jobs to disadvantaged folk who were willing to work for him because he recognized the value they provided and sought to protect them from harm while giving them a living 'wage'. Progressives believe this man is the government, which is why we were exhorted to "move forward together" even as the President sought to polarize us further.
We know the truth. We know this man doesn't exist. We know the best thing the government can say to Progressives is this:
On the other hand, these are the Progressives Obama spoke to:
Tuesday, January 20. 2015
A number of people, mostly born-and-bred New Yawkers, have recently been suggesting to me that New York is in decline. With Mayor Bill, I have a hard time refuting this. On the other hand, their 'evidence' is a host of articles and commentary about the closing of this deli or that dry cleaner, some other diner, or the changing cultural makeup of some community which they'd prefer never change.
"That deli was iconic, how horrible!" "Landlords forced them out by raising rents!" Oh the horror! To me, New York is cool because it doesn't stay the same.
Face it, who wants it to stay the same? Sure I love Carnegie Deli and Katz'. If they closed tomorrow, sad as I'd be, something else would come along. Jack Dempsey's was gone long before I arrived in 1985, should I regret it's passing (I'm sure many did)? Though I haven't been in McSorley's since our hike last fall, and only to use their restroom, I admit I'd fight tooth and nail to keep it open...though probably not. Better to have one last beer and let the past go, if I must.
Bond's is a great example of the idea that New York is improving rather than getting worse. I've eaten at Bond 45 a few times. The food is good, though I consider it comfort food. Still, for a business or friendly lunch in the heart of Times Square it's good to know there is a reliable and reasonable place to eat.
Even so, isn't it lamentable that Bond's is gone? Sort've. I mean, the clothing store and "international casino" are long gone. So is the concert venue, which was iconic because of The Clash in 1981. Well, really iconic because those 'greedy' concert promoters sought to fill overwhelming demand to see a red-hot band (everyone won in that transaction, if I remember correctly...fans like my brother-in-law got to say they 'were there', promoters made some good coin, Bond's made a pretty penny, and The Clash got their cut and made a name for themselves - wait, where was the "greed" again?)
I am reminded of a fellow at a recent event I attended for my alma mater, Syracuse University. This schmuck, after hearing of all the very positive changes the university was implementing, stood up and asked "But what are you doing to preserve traditions, places, and buildings from my past?" The chancellor gave a good, pat answer. As we walked out, I commented to my wife "I don't think that question has any meaning to me. I wonder how someone who graduated in 1880 would feel if he walked the campus today? Would he wish it looked and felt exactly the way it did in 1880, or are students better having things which suit them in this day and age?"
I love standing on campus, making note of the changes, and then commenting about what I did in that building, or how I used to sled down that hill, or how we once sneaked chickens into Bird Library (a feat unlikely to ever be duplicated). The past is the past, and keeping a building around simply because it's always been there isn't a winning idea anymore than it is for me to continue to wish I could still be on the Quad throwing a football.
Progress is painful, especially on our emotional ties to the past. But progress is a net positive, and we shouldn't simply let the past get in the way of progress. Even if it is because of some 'greedy' landlord in a city that epitomizes (or used to) progress. I like the fact I saw several games in the old Yankee Stadium or even Shea Stadium. But the new stadiums are still a great place to see a game, regardless of their limited history.
Thursday, January 8. 2015
I always wondered whatever happened to organ grinders. I'd never seen one in the US, except on cartoons or in old movies. I saw quite a few when I lived in London in 1983 (I have a picture of a particularly colorful one). I had no idea LaGuardia outlawed them, or his reasons for doing so. With the swipe of a pen, he outlawed a form of employment (beats the hell out of other forms of begging, if you ask me). But you can be assured, it was in the "best interest of the people" (and the monkeys!). I'm certain this is precisely how Mayor Bill feels about horse carriages. His views are the only ones that matter because nobody else really cares about those poor horses, right? It's in our best interest, of course. Below is a picture of one of the last legal organ grinders in NYC.
Wednesday, December 31. 2014
Then I realized I was riding on the train to work for about the 7,000th time in my life, and I was likely to do it over and over again for another 6,000 or so rides. It was at that point I asked, "Hey God, where's my miracle?"
Almost as soon as that popped into my head, I realized how stupid I was. I contemplated this a bit further, though. Plenty of people pray to God for the things they want. Love, money, enjoyment, even critical things like surviving a difficult situation or just simply living through a debilitating disease. We all hope for God, or whatever being or entity we believe in, to provide us a miracle at some point.
I say "we all" because the old phrase "There are no atheists in foxholes" rings true to me. At some point, in everyone's life, we've asked a higher power for something.
So here I was, just lazily asking God for a miracle to help me not have to ride this train into the city anymore. Hardly worth asking for. But I asked it because I was being mentally lazy.
Atheists sometimes use the 'fact' that God doesn't 'answer' prayers as a proof that there is no God. I've never found that particularly compelling, for one reason.
Continue reading "A Thought about God While on the Train"
Tuesday, December 30. 2014
From Wikipedia, where I was doing some background research on various football teams:
In 1930, there were still many who questioned the quality of the professional game, claiming the college "amateurs" played with more intensity than professionals. In December 1930, the Giants played a team of Notre Dame All Stars at the Polo Grounds to raise money for the unemployed of New York City. It was also an opportunity to establish the skill and prestige of the pro game. Knute Rockne reassembled his Four Horsemen along with the stars of his 1924 Championship squad and told them to score early, then defend. Rockne, like much of the public, thought little of pro football and expected an easy win. But from the beginning it was a one-way contest, with Friedman running for two Giant touchdowns and Hap Moran passing for another. Notre Dame failed to score. When it was all over, Coach Rockne told his team, "That was the greatest football machine I ever saw. I am glad none of you got hurt." The game raised $100,000 for the homeless, and is often credited with establishing the legitimacy of the professional game for those who were critical.
Not an insubstantial sum, it represented .6% of per capita government welfare spending in the New York area. Total government (federal, state, and local) spending in 1930 was $11.9bb and only $300mm was on welfare. By 1934, those totals were $12.8bb and $1.0bb. By 1940, the same figures were $20.4bb and $2.1bb.
For all the problems the NFL faces, there is still plenty to feel good about, though I don't think it would be easy to match that $1.4mm figure today, unless all the ticket receipts were just turned over.
Monday, December 29. 2014
The post I was writing was specific to the riots in Ferguson. Then Eric Garner's Grand Jury results came in and it morphed. Then my ultra-liberal sister posted an article about how white people simply can't understand the black narrative and we need to be sensitive to why they feel the way they do about cops. This was followed by a discussion over a post by my friend which supported the #crimingwhilewhite tweeters. Then I picked up my son from college and heard about how 'white privilege' is now a hot topic among his classmates. Finally, two cops were shot and buried in the last week. I spent time trying to decide whether this was a post about race, cops, or something else altogether. In the end, I realized it's probably a number of things, because there wasn't just one narrative here. Brown and Garner were not about race, no matter how much people wanted them to be. Nor were they only about how bad cops are, or can be. Nor was any of this about how poorly the media handles these topics, or how those who consider themselves the intellectual elite manage the discussion. It's really about all of these items, but none of them, either. Ultimately, in the end, it's about each of us and how we individually think about unconnected events which we try to connect through some kind of hive mentality. It's about whether we really care about these events, and how we care about them.
At first, I planned to discuss how far we'd come in race relations. We have come very far. It's impossible to look at how we deal with race today and say we are in the same place we were in any year from 1880-2000. My friend said that improvement is relative, that we have further to go. Perhaps we do. But I'm not benchmarking myself against an unclear ideal which no group of people fully agree on. What will represent the final 'best' format of race in our nation? Nobody knows. All we can do is be aware of ourselves, individually, and try to be better about how we treat people when it comes to race, gender, nationality and religion. I include all of these together because as a society we have issues in every single one of these categories. We need to stop letting one word, used out of place or out of context, produce rage. We need to ignore things like "trigger words", which are nothing more than words which certain people have designated for censorship because they lack the courage to accept that language is malleable and can sometimes offend even slightly. As a nation, we need a real dialogue. Not about race, in particular. We need a dialogue about values and what is truly important. Race may be part of that value structure, but it's only a small part. Individual responsibility is really the larger value structure we need to focus on. Responsibility for our own health, our own minds, our own speech and our own education. We can't let small parts of the 'society' value chain derail us from the goal of crafting a nation which is unified entirely by how different each person is.
Continue reading "I Do Care about race relations"
Wednesday, December 17. 2014
Today I had to discuss business with him at a designated time and arrived as the last biscuit was handed out.
A group of people entered just after me, and were told the last one had be served. One fellow responded "Well, good, because I was conflicted."
"Conflicted about what?" I asked.
"I hate that company and everything it stands for. So I wasn't sure I wanted a biscuit. I'm glad they are gone so I don't have any moral qualms."
I started laughing and said "They make a damn good chicken sandwich, and that's all I care about. I can't stand many Hollywood actors and their politics, but I'll still see their movies because I want to be entertained."
He replied, "Well, that's not an issue for me. I like most Hollywood actors."
I could hear my point whistling past his ears.
There aren't many purchases I make while considering the politics of those things. If I did, I probably wouldn't spend much money. I'd have a hard time buying clothes, food, and putting gas in my tank. I'm a fan of Pink Floyd, went to see Roger Waters perform in concert, with all his political nonsense, and simply told my boys "Enjoy the show and the music, pay no attention to the political diatribes and imagery. We didn't ask for that, he's just decided to force it on his fans, many of whom don't think for themselves, anyway. We are here for the art and the entertainment."
I loves me my Chick-fil-A. I don't agree with their stance on homosexuality. But I'm not convinced my not enjoying chicken will alter their stance. To be honest, I'm not sure what one has to do with the other.
Wednesday, December 10. 2014
Sometime in 1996, I was scuba diving off the Outer Banks. Between dives, the boat captain and I had a conversation. His view was that in 20 years, water would be big business. I found that humorous, but as time passed, it struck me it has become a major industry. Or has it?
We spend little time considering something so basic, so essential, to life. It seems like something we don't really have to think about. Water is, after all, plentiful. But it takes considerable work to make it as plentiful as it is.
While water is handled as a public utility, the reality is there is a huge market for it and it is, as the captain suggested, big business. But it's always been big business, we just don't pay much attention to it because it's always available.
I had no idea the NY Public Library was built on the remains of the Croton Reservoir...
Walsh: Forget it, Jake. It's Chinatown.
Monday, December 8. 2014
Last year, we were at a friend's and I was introduced to the Coquito. This is, basically, a Puerto Rican eggnog.
Very tasty, but also very fattening. Probably 10,000 calories per glass. Delicious as can be. After that party, I made some and brought them to our family Christmas party, where they were a hit. We all had to run marathons to burn off the calories, but it was worth it.
I decided to make them again this year and found another recipe to work with. Most of the recipes are similar, though there are minor variations which make it an interesting drink. This year's recipe called for egg yolks, last year's did not. Last year I added nutmeg and vanilla. This year I didn't.
I pour it into resealable bottles, and keep it cold. It needs to be shaken prior to pouring, and sometimes you have to warm the neck of the bottle a bit to loosen it up.
I don't usually like distilled liquors, but during the winter I'll have some whiskey or add rum to my drinks. Particularly when the temperature dips as it has lately.
Continue reading "Coquitos for holiday season"
Thursday, December 4. 2014
He then took each to the side for a personal word.
Perhaps not as meaningful as his farewell speech to the troops, but the depth of his relationships which grew from the war followed him for years to come. Many continued to visit him at Mount Vernon. For obvious reasons, he will remain the only US President elected unanimously by the Electoral College.
Wednesday, December 3. 2014
When we hear how terrible politics are today, we fail to understand just awful they were in the early 1800's. It's not so much that things are bad today, but we should consider as a nation we went through a period of relatively limited political differentiation for quite some time from the Depression until about 1980. The political turmoil we are experiencing today isn't too different from our early years as a nation, much of which was mimicked at the turn of the 19th century. Adams held office at a time of massive partisanship, bickering and outright slander, at times.
John Quincy's years in the White House were spent trying to find things to do to keep himself occupied, since nothing he would propose could ever make it through Congress, such was Andrew Jackson's chokehold on the legislative branch. He was often ridiculed in the press, and often the butt of jokes during his tenure. Yet he persevered and was the only president to ever return to the House of Representatives (Andrew Johnson returned to the Senate).
John Quincy accomplished more before, and after, his presidency than most individuals of any stripe are capable of achieving. He was a master negotiator, a magnificent statesman, and a strong believer in the rights of man. He campaigned relentlessly to free the slaves upon his return to Congress, which led to the famous "Gag Rule," named after one of his comments. Despite being gagged, Adams was an expert Parliamentarian and found ways to have his voice heard.
He was the first US ambassador to Russia, and well liked there due to his role as secretary, at the age of 14, to Francis Dana from 1780 to 1783 in St. Petersburg. He worked hard, along with his father, to gain independence from Britain.
Adams was a promoter of education and science. We can thank him for the development of the Smithsonian Institute. Adams prevented Smithson's funds from being divided for political spoils and putting them to work for the country and education.
He was the first president ever photographed (the first sitting president to be photographed was William Henry Harrison in 1841, Adams' original picture was destroyed and he had new ones taken in 1843).
We often overlook many of our presidents, for obvious reasons. Some are larger than life. It's possible John Quincy was larger than our imagination, mainly because his term in office left him as an asterisk for many schoolchildren. "The son of a founding father and first child of a president to attain that office" is how I learned about him. His lack of effectiveness in office may have led to him being overlooked after years had passed, but it doesn't diminish his impact on our nation. We owe quite a bit to him.
Thursday, November 20. 2014
Here is a recent article from Ephemeral New York on Five Points.
Monday, November 17. 2014
Relaxed and enjoyed the sound of waves, played dominoes with the in-laws, ate fish every day, did some surf-casting (caught plenty, but nothing big enough), read my book (The War That Ended Peace by Margaret MacMillan), and today I'm going kayaking or paddle-boarding. If I can, paddle-boarding, it's better for your core. But either is a good workout.
I had blackened lane snapper last night at a restaurant that didn't appear to be more than a hole in the wall, probably the best I've had. Sometimes it's best not to judge based on the superficial appearance. We had breaded hogfish the night before, at the in-laws'.
Flight home tomorrow in the early morning. This is the second year I took a mid-November vacation. It's a good time to go south. Not only do you stay warm when the rest of the country is chilling, but you get two shortened workweeks heading into Thanksgiving. Then you roll right into the Christmas holiday season.
Wednesday, November 12. 2014
Our urban hike just won't go away. Yesterday, Bird Dog posted pics of Trinity Church. Today I'm posting one location we didn't happen to visit. It was on the original agenda, by the time we got to Washington Square, taking a swing west would have added too much time to the walk. Spirits were high, but it seemed too much to ask. There's always next year.
As a young arrival in New York, I was single and had small amounts of cash to spend on entertainment. There were plenty of ways to find that entertainment at South Street Seaport, midtown in some of the (much more expensive) watering holes, Greenwich Village, and even portions of the West Village. In particular, The White Horse Tavern (warning - the full article, if you wish to read it, requires joining the site, but there is plenty in the portion I've linked to) was one of my favorite places to go after work on Thursday and Friday. For some reason, I never stopped in on the weekends.
Continue reading "The White Horse Tavern"
Saturday, November 8. 2014
Earlier this year, my son came home from school and asked me how hard it was to brew beer. This was not a surprising question from a boy who is 17. I still asked him why he wanted to know. His response was related to school (shocking). He said his Chemistry teacher brewed beer. I thought for a moment, and pointed out that cooking was a form of chemistry, so brewing seemed a natural extension.
At that point I mentioned a brew kit my brother had purchased for my birthday many years ago. It languished in an apartment closet until we moved to our house, and I never utilized it It was gone, but I asked would he be interested in learning to brew?
The answer was robustly affirmative, and we began to look into the purchase of a brew kit.
If you have the desire, you can build your own brew kit for about $35. Two 6 gallon Home Depot buckets, a siphon, an airlock, some washers and a small plastic spigot and you're all set to build the kit on your own. The spigot, washers and airlock can all be purchased online. You'll need lids for the Home Depot buckets. You'll need drills to attach the spigot and the airlock. It will take a little time and effort, but would save a little cash. The alternative is to spend about $100, buy the kit ready made along with all the ingredients for your first batch of brew. I opted for the expensive, easier, route.
You'll also want to read up on brewing first, too.
Continue reading "Oktober Brew for November - reposted"
Thursday, November 6. 2014
How to Lie With Statistics was the first book I was required to read when I was studying for my Master's in Economics. The book wasn't designed to show us how to lie, but to make a point. It's easy to lie with statistics. 100% of the time. 60% of the time, lying works all the time. It's all about positioning. Al Franken cut his teeth by showing how Republicans lied using tricky graphing techniques, then started using his own special brand of lying to continue to hoodwink his constituents.
The book was really designed to get students to think about context. When I present data, I never present just data, I present context. It's not enough to say that Man-Made Global Warming correlates with the reduction in pirate activity. We all know correlation is not causation, the context of why the lack of piracy is causing Global Warming is critical.
I recently posted about why interest rates won't rise. Part of that discussion continued on in the comments section, regarding inflation and savings. Normally, interest rates are slightly higher than inflation (positive real interest rates), and typically fall below the rate of inflation when the economy is in a rut (negative real interest rates, when people spend more than they save, driving up inflation but eventually causing interest rates to rise in order to attract savings). Yet we have not seen a general rise in inflation or interest rates in the last few years. There are many reasons for this, and those reasons are helping to keep real interest rates negative and low. If we knew the truth, we'd probably see more consumers behave differently, and it's likely the Fed couldn't continue engaging its policy of printing more money. But hiding inflation is exceedingly easy to do. Especially if you utilize hedonic adjustments, which is one of many methods used to delude the populace.
Hedonic adjustments can be justifiable. For example, if a regular banana costs $1, but a banana that keeps you full all day and meets your minimum daily health needs is only $5, it would appear the 'cost' of a banana is 400% higher than it should be, if you want to live. However, if it takes 10 regular bananas to match what you can get from 1 $5 banana, then you've actually realized a 50% decrease in price! Hedonics DO make sense,when in the realm of productivity gains for the consumer.
However, as the linked article from Zero Hedge points out, you can use 'enjoyment quality' to make a 400% increase actually appear to be a 7.1% decrease. You get no real additional value out of a 42 inch plasma TV that you didn't get from a 27 inch LCD. But the government can quantify and justify that the price you paid was actually LESS for the big screen plasma, even if it wasn't. Voila! You've saved money by spending more! Looking at the list of areas where hedonic adjustments are applied show a variety of useless of price decreases, simply so the government can imply regularly that you are spending less than you really are. It helps our politicians maintain "the money illusion." This benefits them, allowing them to engage Keynes' famous quote, “Lenin (the founder of the former communist Soviet Union) was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose”.
So yes, technically our inflation rate has been far higher than you realize, and the Fed has been making your savings worth less and less each year. No, it probably won't end well, so enjoy it while you can, and remember to try and find the contextual support for any government data. There usually isn't any.
Tuesday, November 4. 2014
It's not uncommon to hear Fed officials and politicians deny that we are monetizing debt. Technically, we are not. We issue debt, the debt gets purchased, and the Fed (which is essentially a private institution, though it's really a quasi-governmental institution) buys it back. Normally government debt is held by the public, which is why economic analysis of the old "crowding out" problem was so prevalent.
By keeping interest rates low, and repurchasing debt, the appearance of private ownership is maintained, but it is a roundabout method of monetizing debt. Allowing rates to rise to any meaningful degree will have severe negative impacts, in the short term. Since we are in a politically driven economy, this cannot be allowed to occur, so interest rates must remain artificially low.
Of course, the long term ramifications of monetizing debt are inflation (followed by deflation) and severe misallocation of economic resources. In other words, bankruptcies, unemployment and a financial morass. Not to mention the end of an expectation of comfortable retirement (how can you retire on a fixed income if interest rates are below 1%?).
Don't expect interest rates to move up any time soon, and don't expect any reporting of realistic inflation. Just vote for the guy/gal who will shovel the most tax money toward you.
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