211–220 of 274 posts
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Keep reading the comment. Why do people buy iPhones today knowing that they can get a significant discount in 6-12m for that same iPhone
Because an iphone is a status symbol, and in 6-12m that same iphone won't grant the same status, a newer more expensive one will.
I'm not a gold bug but Alan was a proponent of the gold standard. He wrote about how the gold standard created responsible spending and more equality in the world: https://ritholtz.com/2008/11/gold-and-economic-freedom-by-al... The world we are in now, especially in the US, is one where there is near unlimited government credit but it is, according to many, papering over deep structural problems. At some point, these…
What happens in practice is that you set a conversion rate to account for this, and basically immediately things start to drift further and further out of whack leading to massive distortion. There's a reason the gold standard era was a cycle of big swings of inflation and deflation, with panics, recessions, crashes pretty continually.
It's the same with fixed or pegged exchange rates - you can set it to something reasonable at the start but it will always drift, usually until things are distorted that the system fails. That's why we don't have a gold standard anymore and why fixed exchange rates have all mostly failed and gone away too.
There's just no reason to believe that pegs to commodities or other currencies would ever correspond to the amount of money that the economy needs to be in circulation, so they always fail.
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There was a stimulus check that went out around that time. I felt it insane that I was receiving a check when nobody in my life was negatively impacted, the economy didn’t seem hurt (no more then when you’re up then down at a blackjack table), it was just a rebalancing of people’s portfolios values. Turns out that started the wave of completely untargeted stimulus/aide that would come at every economic faltering. I w…
> rebalancing of people’s portfolios values It's not just portfolio value. It's well accepted in the economics that wealth impact's people spending (see wealth effect and its cousin negative wealth effect)
Revisionist history will tell it differently, but I remember that from the mid 1990s until about 2000 when the economy was booming yet prices weren't rising, Greenspan publicly indicated that he wasn't sure exactly why that was. Or at least that the information economy had different performance characteristics than the industrial economy, since production wasn't limited by supply but by worker productivity multiplier…
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We have nearly doubled the federal budget over 10 years. It is a spending problem and a spending problem alone. https://news.ycombinator.com/item?id=48633650
This presumes that federal spending is a bad thing.
This is basic economics.
Yes, excessive federal spending is bad.
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EDIT: I see several comments suggesting that there is nothing left to cut. I'm not sure how anyone squares that perspective with this federal budget growth chart. The federal budget over time... 2026 - $7.5 trillion 2020 - $4.8 trillion 2015 - $3.9 trillion 2010 - $3.7 trillion https://fred.stlouisfed.org/series/FGEXPND We do not have a tax problem, we have a spending problem. There's no reason that the US federal go…
You should leave Social Security out of the calculations. It's supposed to be a self-funding program that has no impact on budget balance. That accounts for ~$0.5 trillion of the growth since 2020. Another ~$0.5 trillion is from higher interest payments. A large fraction of the budget consists of wages and actual spending. Inflation is 25–30% since 2020. Then there is healthcare spending, which can be expected to gro…
If we account for only these two things, it is catastrophic.
1. Interest on the debt when we don’t have a balanced budget to stop growing that debt will spiral out of control.
2. When any part of that spending which is creating inflation already must then increase to pay for the inflation that it is causing, we are circling the drain. That is a death spiral.
We need extreme, Javier Milei level cuts to the federal government.
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Per the link you provided https://usafacts.org/government-spending/ 2024 - $6.8 trillion in spending $1.3 trillion Defense, $323 billion of which is veteran support (pensions, retirement, medicare, etc). Discretionary spending is a misnomer that assumes all of the other spending levels just have to be maintained as is, are without fraud, run efficiently and impossible to reform. Cut 20% across the board from every ag…
>"Wealthy people" didn't cause the US government to spend an extra $3.5 trillion a year over a decade ago But... They did. Who do you think wanted Trump's tax cuts on wealthy businesses? Who do you think pushed for Reagan's tax cuts on wealthy businesses while also drastically increasing defense spending? Who do you think still is pushing reduced taxes for wealthy businesses? "We've cut all taxes from the wealthy and…
Spending is the only problem.
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Per the link you provided https://usafacts.org/government-spending/ 2024 - $6.8 trillion in spending $1.3 trillion Defense, $323 billion of which is veteran support (pensions, retirement, medicare, etc). Discretionary spending is a misnomer that assumes all of the other spending levels just have to be maintained as is, are without fraud, run efficiently and impossible to reform. Cut 20% across the board from every ag…
> Discretionary spending is a misnomer that assumes all of the other spending levels just have to be maintained as is, are without fraud, run efficiently and impossible to reform. We disagree on the fundamental problem, and I believe your solution is wildly irresponsible to "just keep cutting 20%." You say fraud; prove the fraud. DOGE couldn't find any, so "extraordinary claims require extraordinary evidence." Fraud…
I'm not a gold bug but Alan was a proponent of the gold standard. He wrote about how the gold standard created responsible spending and more equality in the world: https://ritholtz.com/2008/11/gold-and-economic-freedom-by-al... The world we are in now, especially in the US, is one where there is near unlimited government credit but it is, according to many, papering over deep structural problems. At some point, these…
> He wrote about how the gold standard created responsible spending and more equality in the world: The Gilded Age, which had quite high levels of inequality, occurred when the gold standard was active: * https://en.wikipedia.org/wiki/Gilded_Age It should also be noted that the gold standard did not bring any kind of price stability: * https://archive.is/https://www.theatlantic.com/business/arch... Further, sticking…