381–390 of 478 posts
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There's no such thing as fractional reserve banking. It's an urban myth that has been debunked by QE for over a decade. Lord only knows why people still believe it. Banks create money on demand by discounting collateral. Government creates money on demand by discounting the power to tax. Fiat money disappears by the drain to taxation, to repaying loans and to 'rainy day funds'.
Queen Elizabeth?
What this doesn’t really address is the why? Yeah there’s more money floating around, so perhaps more people want to spend it, but why? Most people aren’t getting materially more stuff or even need that much more stuff, consumption’s already god damn conspicuous. Maybe everyone can afford a jet ski all of a sudden? No, the stims didn’t really do /that/ kind of wealth expansion. To me, this still looks like the bullwh…
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>Some lockdown policies directly affect your 'need for stuff' I think this was the root cause of the toilet paper shortage. People who normally spend a large portion of the day at the office were now spending that time at home. There was a popular viral video at the time of a man driving around on a forklift in a warehouse full of toilet paper laughing about the shortage, but it was all commercial toilet paper not wh…
The root cause is that toilet paper is bulky and the stores simply didn’t carry as much of it as (say) tinned goods. It didn’t take a big demand increase to start seeing gaps in shelves, and once that happened a degree of panic took hold and even though there was plenty in stock in warehouses, it wasn’t able to be distributed fast enough. The difficulty is that the big supermarkets have got their supply chain down to…
Plus the commercial domestic imbalance.
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In the macro economic sense, fiat money isn't 'used up' or 'locked away' when you buy something like crypto, it's transferred from your account to someone else's bank account. Worse, it goes through the process of fractional reserve banking and multiplies about ~10x after changing hands repeatedly.
There's no such thing as fractional reserve banking. It's an urban myth that has been debunked by QE for over a decade. Lord only knows why people still believe it. Banks create money on demand by discounting collateral. Government creates money on demand by discounting the power to tax. Fiat money disappears by the drain to taxation, to repaying loans and to 'rainy day funds'.
Fractional reserve banking absolutely exists.
QE is so thinly related I can hardly imagine how you could contort it to have "disproved" something which is codified in law and taught in basic finance and economics courses.
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Organic demand growth is what we want, not this Frankenstein economy that's been created since at least 2008 if not earlier. Demand doesn't boost GDP, producing real goods and services boosts GDP. You can't spend your way to prosperity despite what any of the insane MMT economists might say. I agree that wage growth is good but not in the manner it's happening right now, through insanely easy money policies creating…
> Demand doesn't boost GDP, producing real goods and services boosts GDP. You can't spend your way to prosperity despite what any of the insane MMT economists might say. I appreciate that you feel strongly on this matter. However, the strength of your feelings are less relevant than the fact that different people (who all know quite a lot about this sort of thing) do not agree with you (or with each other). Calling M…
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Every year the goalposts move a little bit. Thirty years ago the goal was ca. 0° of global warming. Now we're debating whether we can muster the political will to limit warming to 2° (unlikely) or 3°.
Could it also be our understanding is gradually improving and the externalities are just lagging more than first thought?
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Solar is an excellent replacement for home heating oil during the Michigan winters. The vast majority of people in Michigan are already connected to an extremely efficient distribution network for electricity. The marginal cost of delivering additional energy through this network does not round to zero, it is zero. Meanwhile heating oil is delivered by trucks with a large cost in depreciation, labor, and fuel (furthe…
I live in Michigan. I have a 5.9kwh solar array. Spring/fall, I can produce over 40kwh/day. Summer heat lowers my production to upper 30-40kwh. January 2021, I produced 197kwh the entire month. I know this discussion is focused on heating. But from an electric vehicle perspective; 197kwh is not that much. In the winter, I don't think it would be enough electricity for a homes electric needs + EV or electric heat. I c…
Serious question, I’m debating a similar setup for myself.
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Meat can be easily substituted, so I'd consider that discretionary spending. Furthermore, producing meat consumes many times the plants, than if humans directly consumed those plants. So in an emergency, just stop producing meat and you'll have plenty of plant-based food left.
Can you eat grass? I know I can't... Yes, producing meat requires animals eating a ton of plants and they also need a lot of water. Except that can be mostly grass (that humans don't eat), and the water is just rainwater (that the animals in question will piss later, so it will end on the ground anyway). The reason why animal-based farming exists is because it is the only way we have to get any food in certain parts…
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How do they deal with insurance? I'm not sure I'd feel very comfortable trusting a random stranger to use my car for 5 days, unless I was sure I'd be paid out in full (or more) if they were to damage or total the vehicle.
Most companies like Airbnb, Turo, Boatsetter (airbnb for boats) offer some insurance they negotiate with an underwriter like Geico. Getting this sort of insurance individually is much more costly or next to impossible, which is why we don't see people short-term renting expensive assets to each other on Craigslist. I imagine negotiating the ability to dole out these sorts of policies at scale with Lloyd's of London o…
On the lessor's side, since the primary market prefers bona fide businesses you're left with the customers who cannot rent from the primary market. Meaning you're much more likely to end up on the receiving end of abuse (outright theft, vandalism, being an accessory to a crime), or at the very least problematic customers ("I know I rented it for one day but I have to pick up my kids tomorrow so I'll return it Thursday"). A business can absorb such variance, or at least create the illusion of doing so, whereas for an individual such events present a major hassle.
You can bundle all of that transactional risk up into a kind of insurance, but that only works if you're large enough that the insurance company can verify that you're not defrauding them.
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The government didn't even grant people a months worth of rent in my city. Not sure how that lead to such a huge infusion of demand that continues to persist, unless there are just that many people with very little rent who are driving this demand. Seems like such a small amount in the grand scheme of things considering most people even working a minimum wage job might see more money back on a tax return than the mea…
Not sure where you live, but a family of two adults and 3 kids got $13,900 in stimulus checks so far in the USA, not counting the expanded child tax credits (which would be another $5400 if the kids are young, dispersed in $900 monthly payments for the last 6 months of the year). Even a single adult with no kids would have gotten $3,200 so far. I mean, damn, how much is rent in your city? https://www.pgpf.org/blog/20…
(Now, I also don't qualify for the stimulus, and if I did, I would probably have been unable to afford a 1 bedroom apt. here.)