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No one really knows how the economy works.


spygirl

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No one really knows how the economy works. A Fed paper is the latest sign.

Or put much less politely, as Mr. Rudd writes in the first sentence of his paper, “Mainstream economics is replete with ideas that ‘everyone knows’ to be true, but that are actually arrant nonsense.”

https://www.mcezone.com/no-one-really-knows-how-the-economy-works-a-fed-paper-is-the-latest-sign/

https://www.federalreserve.gov/econres/feds/files/2021062pap.pdf

 

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I said this on another thread.

Economics can describe what is happening and explain events after they happen.

It is useless for predicting anything because they don't know the future states / new normal.

All that governments / central bank can do is to minimise changes, either internal or external, because the whole functioning of a developed economy relies upon people being confident that something similar to the status quo will continue through their lifetime so that they will then be prepared to work full time for forty years on the basis that they know what the rewards for doing that, whilst working and once retired, will be and accept the bargain.

If that confidence wobbles then the economy dives as everyone pulls their labour in order to simply gather or grow enough food or to deal in a localised barter economy independent of central control and taxation.

See Zimbabwe or South Africa for real life examples of this process at different stages of their collapses.

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16 minutes ago, Frank Hovis said:

If that confidence wobbles then the economy dives as everyone pulls their labour in order to simply gather or grow enough food or to deal in a localised barter economy independent of central control and taxation.

See Zimbabwe or South Africa for real life examples of this process at different stages of their collapses.

That's exactly where many parts of western civilisation are right now, in my view.

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7 minutes ago, wherebee said:

That's exactly where many parts of western civilisation are right now, in my view.

 

I see them more steadily transitioning into a serf / slave economy in the manner of the communist states.

You may "own nothing and be happy" but you will still be working forty hours a week for that nothing.

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7 hours ago, Frank Hovis said:

 

I see them more steadily transitioning into a serf / slave economy in the manner of the communist states.

You may "own nothing and be happy" but you will still be working forty hours a week for that nothing.

It'll be we pretend to work for 40 hours, and they pretend to pay us for 40 hours.

Several years ago i noted, that European MP's they were using the word "solidarity" in every other sentence, and to give credit to our lot they're cut from the same cloth as those 21st century commies.

 

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Just now, Hancock said:

It'll be we pretend to work for 40 hours, and they pretend to pay us for 40 hours.

Several years ago i noted, that European MP's they were using the word "solidarity" in every other sentence, and to give credit to our lot they're cut from the same cloth as those 21st century commies.

 

Solidarity in keeping us solitary

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3 minutes ago, Loki said:

Solidarity in keeping us solitary

Something they've succeeded at with flying colours, wonder if they put their minds to making the continent a better and nicer place to live if they'd be as successful.

Screwing the Greeks over seems to have been the good old days in comparison to whats gone on since.

Edited by Hancock
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On 05/10/2021 at 14:43, Frank Hovis said:

I said this on another thread.

Economics can describe what is happening and explain events after they happen.

It is useless for predicting anything because they don't know the future states / new normal.

All that governments / central bank can do is to minimise changes, either internal or external, because the whole functioning of a developed economy relies upon people being confident that something similar to the status quo will continue through their lifetime so that they will then be prepared to work full time for forty years on the basis that they know what the rewards for doing that, whilst working and once retired, will be and accept the bargain.

If that confidence wobbles then the economy dives as everyone pulls their labour in order to simply gather or grow enough food or to deal in a localised barter economy independent of central control and taxation.

See Zimbabwe or South Africa for real life examples of this process at different stages of their collapses.

Lebanon, Turkry, most African countries, South America.

The problem with macro economists is they spend sll their time on a few successful countries/economies.

And that success tends to be short lived.

 

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  • 1 month later...
On 05/10/2021 at 12:25, spygirl said:

No one really knows how the economy works. A Fed paper is the latest sign.

Or put much less politely, as Mr. Rudd writes in the first sentence of his paper, “Mainstream economics is replete with ideas that ‘everyone knows’ to be true, but that are actually arrant nonsense.”

https://www.mcezone.com/no-one-really-knows-how-the-economy-works-a-fed-paper-is-the-latest-sign/

https://www.federalreserve.gov/econres/feds/files/2021062pap.pdf

 

From what I can see people are loaned bags and bags of debt which is then used to buy assets(property) just ever so slightly more expensive than the huge debt you have taken on which in my eyes seems like delusional wealth but I am assured by all the people I know as they brag on Facebook how wealthy and better they are than everyone else as they withdraw the equity and buy dross.

That's how our economy works

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2 hours ago, haroldshand said:

From what I can see people are loaned bags and bags of debt which is then used to buy assets(property) just ever so slightly more expensive than the huge debt you have taken on which in my eyes seems like delusional wealth but I am assured by all the people I know as they brag on Facebook how wealthy and better they are than everyone else as they withdraw the equity and buy dross.

That's how our economy works

Again, you are putting far more importance of bank credit and housing as part of the UK economy.

In 2008, 80%_ plus of bank lending was going to real estate.

The real economy, the one that employs people and pays there wages had long moved away from banks.

Real estate is drifting further away from the real money earning economy - just look at the number of empty shops and offices.

 

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  • 4 weeks later...
On 05/10/2021 at 14:20, spunko said:

Someone must know how it works at the Fed.

I've been calling em cunts since 2007 lol AND I was working in a large bank at the time :ph34r:

if you think they're in control why has the balance sheet gone parabolic? In fact all CB balance sheets have gone parabolic

Watch 'Princes of the Yen', that's fresh in the mind cos I was talking to a hippy about it yesterday, tis a strange world we now live in...:S

Bernanke used to go on about 'shrinking the balance sheet' and some cunty economists used to agree with him BUT the mathematicians amongst us could see they'd never be able to do it :P

Edited by nirvana
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