Yearly Archives: 2017

Clapper: Not all 17 intelligence agencies were in on assessment about Russian election interference

YouTube has the video Clapper: Not all 17 intelligence agencies were in on assessment about Russian election interference.

In a previous post, NBC’s Kelly Hits Putin with a Beloved Canard, I had included the video of this testimony. Upon going to that post today, I find that that version of the YouTube video is no longer available. SOmeone else must have posted this to YouTube again. If I were one of the corporate news media, I would make a big deal of the obvious conspiracy to suppress this video. Of course, I have no idea why the account that posted it originally was closed, nor why someone else posted the video. You see, I don;t find it necessary to speculate. It is enough for me to report what I can actually see.

In case C-SPAN has YouTube remove the video for copyright reasons, I can at least record here that the video comes from C-SPAN3 and was uploaded to YouTube by Washington Free Beacon on July 5, 2017.

In fact, I found the C-SPAN video dated May 8, 2017.

Russian Interference in 2016 Election Former Acting Attorney General Sally Yates and Former Director of National Intelligence James Clapper testified at a Senate subcommittee hearing on Russian interference in the 2016 election.

Clapper’s testimony from above starts at about 16 minutes into the C-SPAN video.

Economists Are Obsessed with “Job Creation.” How About Less Work?

I had just written a comment about this topic when I stumbled across an Evonomics article Economists Are Obsessed with “Job Creation.” How About Less Work?

Let’s get our economists thinking about how to create a world that maximizes play and minimizes work. It seems like a solvable problem. We’d all be better off if people doing useless or harmful jobs were playing, instead, and we all shared equally the necessary work and the benefits that accrue from it.

As corporations automate more and more work, we need to shift our thinking away from a social system that distributes wealth based on work. I don’t have the answer, but this article focuses on the thinking that needs to be done and why it can succeed.

The REAL Reason FedEx And UPS Are Fighting For Tax Cuts

YouTube has the video The REAL Reason FedEx And UPS Are Fighting For Tax Cuts.

This episode in a series being done by TYT Investigates gives the facts to backup what I have been saying about the need for tax cuts to create jobs. Well actually, there is a nuance here that I haven’t mentioned before. That is, that even if there is enough business to warrant business expansion, the money will be invested in automation, not in creating more jobs.

This is but one episode in a series. The page to see the links to the UPS and FedEx part of the series is the TYT Investigates Series: Tax Cuts & Job Creation – UPS & FedEx.

Somewhere in the late 1980s, I concluded that I would never become financially independent working for a salary. I needed to become an owner. That is when I started to learn more about investing in the stock market. I am very glad I did, This enabled me to retire shortly after I turned 62.

What Mainstream Economists Get Wrong About Secular Stagnation

The Institute of New Economic Thinking has the article What Mainstream Economists Get Wrong About Secular Stagnation. I came across this because it was reposted in Naked Capitalism under the title Debunking Mainstream Economists on Secular Stagnation and the Loanable Funds Fallacy.

The narrow focus on the ZLB [interest rate Zero Lower Bound] and powerless monetary policy within the framing of a loanable-funds financial system blocks out serious macroeconomic policy debate on how to revive aggregate demand in a sustainable manner. It will keep the U.S. economy on the slow-moving turtle — not because policymakers cannot do anything about it, but we choose to do so. The economic, social and political damage, fully self-inflicted, is going to be of historic proportions.
Due to our inability to free ourselves from the discredited loanable funds doctrine, we have lost the forest for the trees. We cannot see that the solution to the real problem underlying secular stagnation (a structural shortage of aggregate demand) is by no means difficult: use fiscal policy—a package of spending on infrastructure, green energy systems, public transportation and public services, and progressive income taxation—and raise (median) wages. The stagnation will soon be over, relegating all the scholastic talk about the ZLB to the dustbin of a Christmas past.

My Thoughts

As I was reading the article, I had various reactions to what I was reading.

I think one of the major problems of the theory of supply and demand is that it may be true as a static model (all other things being equal), but the economy (and life) are not static. Unless you can take dynamic effects into account, then this static or even quasi-static model will just not represent what actually happens. This is just another way of saying what this article says. Over time, the supply curve and the demand curve interact. There is hardly, if any, point in time when all other things aren’t changing.

In my world of simulating the behavior of integrated circuits, the problem involves non-linear differential equations, not just non-linear algebraic equations.
Here is another problem. “… by the national accounts[,] identity of saving and investment (for closed economies),”

Accounting is also a static snapshot of a dynamic system. A bank creates a loan payable in let’s say 30 years. The spending occurs immediately. In accounting terms these two items balance. However, on impact on the economy, they do not balance. Why else would capitalism have noticed the value of buy now, pay later?
This is no longer a chicken and egg problem of which came first, the chicken or the egg. In real life, there are lots of chickens and lots of eggs. Which came first is irrelevant. Chickens create eggs and eggs create chickens.
Models are a simplification of reality. They apply best when the things that were simplified away don’t matter much. They fail when the things that were simplified away become important. So, when does the loanable funds model apply?

IMHO, the loanable funds model applies when there is a run on the bank. When the fractional reserve banking system is running smoothly, the loanable funds model is irrelevant. That’s why banks have reserves and monetary systems have central reserve banks. These reserve systems let us ignore loanable funds models.

Final Comment

After reading the whole article, I think most of my points were covered in one way or another.

CNN’s Alisyn Camerota hammers Jill Stein for denying evidence of Russian election meddling

Rawstory has the article Watch: CNN’s Alisyn Camerota hammers Jill Stein for denying evidence of Russian election meddling. With all that hammering, Jill Stein came out without a dent. Alisyn Caemerota’s arms are probably still feeling the reverberations from the hammer blows bouncing off of Jill Stein.

The interviewer hammered, but Jill Stein had all the answers. I have more computer technical knowledge than Jill Stein does, so I have a better idea of how phony the “evidence” is about the Russian involvement in the DNC email leak. She is absolutely right in saying that the “proof” of Russian involvement is the mere assertion that the Russians did it by a small group in our “intelligence” community. What the so called report provided does more to exonerate the Russians than it does to prove they were involved, yet the intelligence people believe deep down in their hearts that the Russians did it.

See my previous post Election Hack Report FAQ: What You Need to Know for the reasons why I think Jill Stein was correct.

DSGE Dilettantes v. ADM God Devotees

New Economic Perspectives has the article DSGE Dilettantes v. ADM God Devotees.

The truly exceptional thing about ‘modern macroeconomics’ devotees is not that they are so consistently and horrifically wrong or that they persist in their errors – but their exceptional combination of arrogance and disdain for those who have dramatically better records and broader and more relevant expertise.

I don’t know if this can be considered part of failure of the DSGE “scientific” method. But here is something I observed about the collapse in 2008/2009. The back testing of the financial derivatives used the historical fact that mortgage defaults never rose above a certain level when responsible mortgage underwriting practices were employed. The banks then dumped all responsible mortgage underwriting principles and assumed that the safety of their back testing would still apply.

Before the age of these derivatives were ushered in based on the safety “intuition” from the mathematical model, it had never been profitable to make mortgage loans based on loose and deceptive underwriting principles. So the derivatives that supported the bubble ushered in the very conditions that had never existed when the mathematical model were derived under the assumption that these would never exist, based on past history.

I don’t know what kind of degree you have to get to be able to make such illogical assumptions and inappropriate fancy math. What is more surprising is that these people don’t even think about this obvious blunder that made such an epic fail to occur.

The REAL Reason This CORRUPT Senator Flip-Flopped On Trump’s Tax Cut Bill

YouTube has the video The REAL Reason This CORRUPT Senator Flip-Flopped On Trump’s Tax Cut Bill.

Corker claimed not to understand whether or not as a real estate investor he would benefit from this.

As an investor who is a pipsqueak compared to Corker, even I know what this provision is for. When I was invested in Real Estate Investment Trusts, I knew that these organization’s dividends that that they paid me were critically dependent on these loopholes. Apparently the tax code revision must have taken these loopholes out, and someone must have pointed out that they needed to be put back in.

I should point out that I had these REITs in an IRA so that I did not pay taxes on the dividends that were passed on to me.

The Destruction of Matt Taibbi

Paste Magazine has the article The Destruction of Matt Taibbi.

“These claims that Matt would do this stuff are ridiculous,” she said. “I left The eXile because we started dating, and Matt was worried about impropriety. He didn’t even ask me out at work! Matt is a fundamentally decent and kind person.”

I never knew that this had been done to Matt Taibbi. I was wondering why he seemed to have disappeared.

The right has found a new weapon that seems to have been first wielded by Democrats. When I first listened to the Trump tape, I was reminded of some of the stories guys would tell to boost their images. One never knew if any of it was true. In Taibbi’s case all the indentifiable women involved say that it was not true and was never meant to be taken as true.

This is why I have taken to using <sarcasm></sarcasm> or <satire></satire> flags around everything that I write that might not be recognized for what it is by some readers. It sort of spoils the joke to label it that flagrantly, but better to be safe than sorry.


Pragmatic Capitalism has the article IDGAF > FOMO.

We’re now entering silly season in the markets. People are buying cryptocurrencies that no one understands and have very little actual utility. People are chasing stocks higher on a daily basis. Emerging market stocks, tech stocks and all the other riskiest parts of the stock markets are the biggest winners of the year. And a large part of this is due to FOMO – Fear Of Missing Out. After 8 years of straight up stock market gains, rising home prices and now a crypto boom like the world has never seen, there is a palpable feeling of irrational exuberance overtaking the markets.

This is the thinking that kept me safe while others were going crazy over the tech bubble of the 1990s and the real estate bubble of the 2000s. I am trying like heck to keep myself safe in the current bubble. Only time will tell if I will succeed. Another name for what I try to do is called value investing.

Elasticity of Money is a Feature, not a Bug

Pragmatic Capitalism has the article Elasticity of Money is a Feature, not a Bug.

…this idea that a fixed money supply is good is not consistent with the history of money or even the basic facts about how modern money works. Worse, it constrains our economy in ways that make us worse off in the long-run.

Here is yet another way to explain what seems to me ought to be obvious.

It’s not that an artificially fixed money supply could not work. Deflation could offset the problem of a currency that does not grow with the economy. The trouble is that deflation is so far removed from our everyday experience of money that it would require major adaptations. Whereas inflation favors borrowers over lenders, deflation does the exact opposite. This has economic consequences that hinder the growth possibilities of an economy. They don’t prevent growth, but they do make it harder rather than easier.