Bloodbath for Science

Post by brc » Tue, Feb 15, 2011, 10:14 AM UTC

po wrote: post #33

thematt wrote: post #25

Earlier quoted context omitted.

This is usual argument, but it's purely academic in nature. Yes, by law, the government can continue to print money indefinitely. But guess what? At some point people will stop buying that debt. So even though the government has a mandate to continue printing paper and by definition can't go "bankrupt", that's effectively meaningless when people no longer accept your currency.

If by academic in nature you mean grounded in reality instead of a bad analogy then yes it is. Now that we've decided not to view the problem through the lens of personal or corporate finance we can look at the problem as it is: macroeconomics. Luckily, we're in agreement! Yes, inflating away the problem is fraught with peril just as you say. But I will suggest to you that high unemployment is also very perilous. The…

One day you will realise that printing money does not increase wealth. Sure, it increases all sorts of economic indexes but nobody gets richer because more bits of paper are circulating around. It takes a while for the effect to take root, but sure as apples, take root it will.

Austerity programs are taking the medicine after the party. Printing money and borrowing more is hair of the dog. Guess which person ends up with the biggest hangover?

Post by po » Thu, Feb 17, 2011, 5:49 AM UTC

brc wrote: post #41

po wrote: post #33

Earlier quoted context omitted.

If by academic in nature you mean grounded in reality instead of a bad analogy then yes it is. Now that we've decided not to view the problem through the lens of personal or corporate finance we can look at the problem as it is: macroeconomics. Luckily, we're in agreement! Yes, inflating away the problem is fraught with peril just as you say. But I will suggest to you that high unemployment is also very perilous. The…

One day you will realise that printing money does not increase wealth. Sure, it increases all sorts of economic indexes but nobody gets richer because more bits of paper are circulating around. It takes a while for the effect to take root, but sure as apples, take root it will. Austerity programs are taking the medicine after the party. Printing money and borrowing more is hair of the dog. Guess which person ends up…

Roots, medicine, hangovers… adding more analogies to the conversation doesn't convince me of anything. If anything it throws up red flags that you're probably using a simplified model to analyze the problems. What takes root? What happens?

Where's the data? Ireland had a budget surplus before their current dilemma, was that a sign of health? Is a deficit a sign of weakness? I don't think printing money increases wealth; I've never even mentioned wealth.

You've clearly thought about this problem a lot because you care enough to post about it. The problem is that you still only understand about 5% of it (I sure as hell don't understand it as much as I would like to). You've filled in the rest with assumptions, wrapped a nice anecdote around it and are now going around smugly wagging your finger at people who say it's more complex than "surplus good/printing money bad". Drop the rhetoric and make me a convincing argument based on macroeconomics.

Re: Bloodbath for Science

Re: Bloodbath for Science