Quantitative Easing Benefits the Super-Elite … And Hurts the Little Guy and the American Economy

[SD Realtor]

I think getting in good physical health is a good thing to do. I agree that the can has been kicked down the road so long that it is easy to form an illusion. Inflating our way out of the mess will not work given the quantity of debt we are carrying. While the value of the notes that are held decrease due to the currency approaching what will be turd wipe status, each bond auction will require a higher and higher interest rate. Similarly price inflation without wage inflation will be very tough to handle.

With very few exceptions, conditions will be much harsher for our children then they have been for us.

[scaredyclassic]

but they may be happier. in fact, I suspect there will be more happiness in the future.

and i am the most negative, pessimistic person in a 500 foot radius.

i am willing to bet that the average person will be happier 40 years from now in america than the average person was in 1994.

[ltsddd]

I am also pretty sure 40 years from now, the average adult will be complaining about how the “younger” generation are lazy, ungrateful, and have this sense of entitlement.

[scaredyclassic]

my kids are at least three time better adjusted than I was…yup the trendline is up

[Coronita]

[quote=ltsdd]I am also pretty sure 40 years from now, the average adult will be complaining about how the “younger” generation are lazy, ungrateful, and have this sense of entitlement.[/quote]

Yeah, but short of the generation that came before Baby Boomers, I’d say that’s the majority of america right now, including baby boomers.

[Coronita]

.

[ltsddd]

[quote=flu][quote=ltsdd]I am also pretty sure 40 years from now, the average adult will be complaining about how the “younger” generation are lazy, ungrateful, and have this sense of entitlement.[/quote]

Yeah, but short of the generation that came before Baby Boomers, I’d say that’s the majority of america right now, including baby boomers.[/quote]

What makes you believe that’s the case? The younger generation has more work cut out for them not because of their lack of motivation and laziness but rather due to the increased in competition both internally, due to population increase, and externally from other countries that only in recent years began to shed itself the effects of decades of wars and colonial rules.

During the 50’s what and who did we really have to compete against? Japan, Russia and Europe were in rebuilding mode after the war. China was still fighting a civil war. Korea was a backward third-world country in the midst of a civil war. India just barely got its independence. Most of the rest of the world were still under colonial rule.

I don’t want to take away the accomplishments of our previous generations. But at the same time let’s not be too harsh and sell the younger generation short, either.

[Coronita]

[quote=ltsdd][quote=flu][quote=ltsdd]I am also pretty sure 40 years from now, the average adult will be complaining about how the “younger” generation are lazy, ungrateful, and have this sense of entitlement.[/quote]

Yeah, but short of the generation that came before Baby Boomers, I’d say that’s the majority of america right now, including baby boomers.[/quote]

What makes you believe that’s the case? The younger generation has more work cut out for them not because of their lack of motivation and laziness but rather due to the increased in competition both internally, due to population increase, and externally from other countries that only in recent years began to shed itself the effects of decades of wars and colonial rules.

During the 50’s what and who did we really have to compete against? Japan, Russia and Europe were in rebuilding mode after the war. China was still fighting a civil war. Korea was a backward third-world country in the midst of a civil war. India just barely got its independence. Most of the rest of the world were still under colonial rule.

I don’t want to take away the accomplishments of our previous generations. But at the same time let’s not be too harsh and sell the younger generation short, either.[/quote]

Interviewing them…. Some of them really are still in la-la-la land…

I was phone screening some interns recently from college. No experience, and frankly sucky skills. and was asking some rudimentary technical questions (which they couldn’t answer BTW). But nevertheless, I thought…Ok local person, maybe the person will surprise me with some “mark of intelligence…” Well a few more minutes in the middle of the interview… I get a “can you hold on, someone is sending me a message on twitter?”…

I don’t know, but when I graduated and jobs were scarce, and I had limited work experience (which at the time was a hell of a lot more than some of these jokers), I took every opportunity I could to try to get every possible position rather than fvcking around on the BBS chatting to people at the same time…

Guy had the nerve to call back and ask when to start. I almost flipped out and was gonna say what I was thinking “are you fvcking kidding me?”, only to be held back with the flashes of the word “liability”…. hell no did I want to make this person a millionaire via some stupid lawsuit..
So I bit my tongue and referred him to HR to get an update on his/her status.

I hate to say this, there’s a reason why a lot of these high tech jobs are going to H1-B’s these days…Apparently a lot of them take their work more seriously. The economy is *that* bad , people are complaining they can’t find jobs. And yet you have still a lot of arrogant people who are still in la-la-la land, when they don’t know crap, and demand to be compensated as if they’re an expert with absolutely no experience. Great, I guess if they create facebook app, that will lead them on the road to riches…Like Zygna…Oh, wait…. nevermind.

[SD Realtor]

I love the logic. So let me get this straight. When our kids grow up they will have less opportunity to get quality jobs. They will live in a country that is riddled with debt and could have by then defaulted. They will live in a society that does not enjoy the same benefits as the society that their parents lived in at both the state and federal levels. They will have a currency that is worth less then it was when they were kids. They will have to compete much harder for jobs. They may have advance degrees but may have to settle for jobs that do not require them.

However your argument is that they will be happier? That logic is based on what? That they will be happier because they did not know what it was like to live in a better society?

So if you never got to live through better times, you will be happier living in crappier times.

Awesome logic man… just awesome.

[CA renter]

[quote=SK in CV][quote=SD Realtor]Obviously Bush is behind all of this, even QE4, 5, 6 and 7![/quote]

I’m quite sure nobody has ever claimed that Bush is behind it. It’s as ridiculous a claim as that which charges this is Keynesian economics at work. It’s not. Keynes, at most, was agnostic on monetary manipulation as a means of economic stimulus.

I’m not so sure that it doesn’t benefit the economy as a whole, but there’s no question that the biggest beneficiaries are debt holders. That’s the big banks. Is there a better way to do the same thing or better for the economy as a whole without particularly benefitting the banking industry? I could be convinced, but I haven’t seen any ideas that meet the requirements.[/quote]

If we had allowed deflation to work its magic back in 2008, I think we’d be better off today. Jobs would have been lost, wages would have fallen, but asset prices would probably have fallen faster and further, leaving Joe Sixpack with more purchasing power. It would also have reduced the income/wage gap that is destroying our economy.

Debtors would lose their homes, but they would also be freed from thousands, or hundreds of thousands, of dollars in debt. Creditors would lose, but higher interest rates going forward would help mitigate some of the pain.

Interest rates would be higher, rewarding savers and making spenders think more wisely about their purchases. The government could have avoided taking on all this debt and we would have a smaller the debt burden, one that cripple us for many, many years to come since we took on so much debt to save the bankers/wealthy — especially when (if) interest rates rise.

We could have stimulated the economy by putting more money into our infrastructure and R&D funding. Stimulus is good, but not when it’s directed at keeping asset prices abnormally high.

Just MHO.

[Coronita]

[quote=CA renter][quote=SK in CV][quote=SD Realtor]Obviously Bush is behind all of this, even QE4, 5, 6 and 7![/quote]

I’m quite sure nobody has ever claimed that Bush is behind it. It’s as ridiculous a claim as that which charges this is Keynesian economics at work. It’s not. Keynes, at most, was agnostic on monetary manipulation as a means of economic stimulus.

I’m not so sure that it doesn’t benefit the economy as a whole, but there’s no question that the biggest beneficiaries are debt holders. That’s the big banks. Is there a better way to do the same thing or better for the economy as a whole without particularly benefitting the banking industry? I could be convinced, but I haven’t seen any ideas that meet the requirements.[/quote]

If we had allowed deflation to work its magic back in 2008, I think we’d be better off today. Jobs would have been lost, wages would have fallen, but asset prices would probably have fallen faster and further, leaving Joe Sixpack with more purchasing power. It would also have reduced the income/wage gap that is destroying our economy.

Debtors would lose their homes, but they would also be freed from thousands, or hundreds of thousands, of dollars in debt. Creditors would lose, but higher interest rates going forward would help mitigate some of the pain.

Interest rates would be higher, rewarding savers and making spenders think more wisely about their purchases. The government could have avoided taking on all this debt and we would have a smaller the debt burden, one that cripple us for many, many years to come since we took on so much debt to save the bankers/wealthy — especially when (if) interest rates rise.

We could have stimulated the economy by putting more money into our infrastructure and R&D funding. Stimulus is good, but not when it’s directed at keeping asset prices abnormally high.

Just MHO.[/quote]

um…How does deflation help a nation that is so knee deep in debt? Those IOU’s sure end up costing a lot more when things are in a deflationary environment. And with that much credit the our government keeps spending on, how can we possibly be deflationary in the long term?

I don’t get it.

[CA renter]

Mass default.

In my scenario, the government would not have taken on all that debt — certainly not to prop up asset prices, which is totally unproductive and does nothing to grow the economy in a sustainable way. It was a choice that was made to benefit the few at the expense of many.

What ultimately matters is the purchasing power of those at the bottom of the economic pyramid. When wealth is concentrated at the top, everything crumbles.

The Fed/govt has only been addressing asset prices, increasing the purchasing power/control of resources of the most wealthy, while those at the bottom steadily lose more ground. The only reason Joe Sixpack isn’t taking on even more debt in order to maintain purchasing power (what the Fed has been trying to push) is because he can’t. All income is being spent, and there is nothing left over from which he can make new purchase or take on more debt. That’s why interest rates are so low right now — to make the debt burden a little lighter for J6 so that he can take on even more debt so he can spend more. This is not sustainable, and will end up making our problems much, much worse (which they already have, IMHO).

BTW, the only kind of inflation that makes payments less burdensome is wage inflation. We are not getting that outside of a few industries. Cost inflation, without wage inflation, is very, very destructive…far more destructive than deflation, IMO.

[scaredyclassic]

[quote=SD Realtor]I love the logic. So let me get this straight. When our kids grow up they will have less opportunity to get quality jobs. They will live in a country that is riddled with debt and could have by then defaulted. They will live in a society that does not enjoy the same benefits as the society that their parents lived in at both the state and federal levels. They will have a currency that is worth less then it was when they were kids. They will have to compete much harder for jobs. They may have advance degrees but may have to settle for jobs that do not require them.

However your argument is that they will be happier? That logic is based on what? That they will be happier because they did not know what it was like to live in a better society?

So if you never got to live through better times, you will be happier living in crappier times.

Awesome logic man… just awesome.[/quote]

Money doesn’t buy happiness.

We have a currency worth a lot less than when we were kids.

And things are better.

I don’t have any particular argument why they will be happier. Just a feeling. A hunch.

Could just be dumb optimism.

[scaredyclassic]

A man will be far happier with a loaf of bread, some cheese he brought home to loving children by bicycle than steaks served by a bitter wife and eaten with ungrateful welps he picked up in a Ferrari.

[scaredyclassic]

I’m not sure what makes one nations people happier than another.

Expectations?

[Author]

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