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Herding Lizards - Doug French - Mises Daily: "The fact is, without the constant inflation of fiat money, people would (or have to) spend very little time thinking about their money or savings. Squirreling a little money out of every paycheck would suffice for retirement preparation."
"investors gravitate en masse to investments that are overpriced"
"Dopamine neurons are stimulated only if the rewards exceed the expectation. If investments work as planned, even if the result is good, there will be no rush at reward. And when results are less than expected, dopamine neurons are depressed — creating immense regret."
"Burnham points out that numerous studies show that people "reveal themselves to be proud. They are willing to lose money to retain their self-esteem." "
"Like thirsty animals on the African Savannah, humans are attracted to the speculative gains that financial markets promise. But, stopping for a drink is likely hazardous to our financial health."
Thursday, May 31, 2012
Cost Shifting Does Not Justify Obamacare | Jeffrey A. Singer | Cato Institute: Commentary
Cost Shifting Does Not Justify Obamacare | Jeffrey A. Singer | Cato Institute: Commentary: "when people don’t pay their medical bills, somebody has to bear that cost. But who?
A study from the National Bureau of Economic Research found that in many cases, it’s other uninsured patients. Many uninsured patients who do pay their bills wind up paying the “list prices” for the services they received. The list price is well above what any provider expects to receive from an insurance company. Physicians collect more from those uninsured patients than they would from insured patients. That extra money often covers the cost of uninsured patients who don’t pay."
"cost shifting due to the uninsured raised private insurance premiums 1.7% “at most.”"
"Much of the current uncompensated care problem is due to a 1986 law called EMTALA (the Emergency Medical Treatment and Labor Act). This law bans hospitals from transferring patients to facilities set up to provide care to the indigent. In the process, it encourages people not to purchase health insurance and to use emergency rooms for primary care. People know that hospital emergency rooms must treat them, and cannot transfer them, even if they have no intention of ever paying for their care. So, for many, the urgency to purchase health insurance becomes less acute."
A study from the National Bureau of Economic Research found that in many cases, it’s other uninsured patients. Many uninsured patients who do pay their bills wind up paying the “list prices” for the services they received. The list price is well above what any provider expects to receive from an insurance company. Physicians collect more from those uninsured patients than they would from insured patients. That extra money often covers the cost of uninsured patients who don’t pay."
"cost shifting due to the uninsured raised private insurance premiums 1.7% “at most.”"
"Much of the current uncompensated care problem is due to a 1986 law called EMTALA (the Emergency Medical Treatment and Labor Act). This law bans hospitals from transferring patients to facilities set up to provide care to the indigent. In the process, it encourages people not to purchase health insurance and to use emergency rooms for primary care. People know that hospital emergency rooms must treat them, and cannot transfer them, even if they have no intention of ever paying for their care. So, for many, the urgency to purchase health insurance becomes less acute."
Inflation Isn't the Point of Monetary Easing | Timothy B. Lee | Cato Institute: Commentary
Inflation Isn't the Point of Monetary Easing | Timothy B. Lee | Cato Institute: Commentary: "In late 2008, the Federal Reserve screwed up and allowed the left-hand side of the equation, MV, to decline sharply."
They only control M and AFAIK it hasn't declined sharply.
"while NGDP fell by much more than that. Math tells us the rest of the decline had to be absorbed Q declining."
Sounds backwards. Falling NGDP didn't cause production to drop -- dropping production cause NGDP to drop.
"In other words, because prices didn’t fall fast enough, we got layoffs instead."
The government artificially restricts falling prices (especially labor)
"by expanding the money supply (M), the Fed can increase MV, which will necessarily increase PQ"
Since the Fed doesn't control V, increasing M can decrease V and not increase MV. So increasing M doesn't necessarily increase PQ. This is basic math and logic...
"If the economy is already humming along nicely, there’s not much room for Q to increase"
Productivity increases constantly increase Q and decrease P even(especially?) in a good economy.
"But if the economy is in a recession, with lots of idle workers and factories sitting around, then monetary stimulus will cause an increase in Q"
Workers and factories aren't easily changed to drastically new uses. It isn't easy for idle construction resources to be moved to manufacturing.
"We just need to convince them that a bit of extra inflation is a price worth paying for getting people back to work."
Getting people back to work is easy (force labor, drop pay, etc) but increasing NGDP isn't easy to do by just increasing M.
They only control M and AFAIK it hasn't declined sharply.
"while NGDP fell by much more than that. Math tells us the rest of the decline had to be absorbed Q declining."
Sounds backwards. Falling NGDP didn't cause production to drop -- dropping production cause NGDP to drop.
"In other words, because prices didn’t fall fast enough, we got layoffs instead."
The government artificially restricts falling prices (especially labor)
"by expanding the money supply (M), the Fed can increase MV, which will necessarily increase PQ"
Since the Fed doesn't control V, increasing M can decrease V and not increase MV. So increasing M doesn't necessarily increase PQ. This is basic math and logic...
"If the economy is already humming along nicely, there’s not much room for Q to increase"
Productivity increases constantly increase Q and decrease P even(especially?) in a good economy.
"But if the economy is in a recession, with lots of idle workers and factories sitting around, then monetary stimulus will cause an increase in Q"
Workers and factories aren't easily changed to drastically new uses. It isn't easy for idle construction resources to be moved to manufacturing.
"We just need to convince them that a bit of extra inflation is a price worth paying for getting people back to work."
Getting people back to work is easy (force labor, drop pay, etc) but increasing NGDP isn't easy to do by just increasing M.
Lagarde expresses regret about Greece comments | Fox News
Lagarde expresses regret about Greece comments | Fox News: Rice says the IMF has "great respect for Greece and the people and the sacrifices that many are making to overcome the economic crisis."
Sacrifices?
Sacrifices?
Wednesday, May 30, 2012
This Is Happening in America? | Nat Hentoff | Cato Institute: Commentary
This Is Happening in America? | Nat Hentoff | Cato Institute: Commentary: "Attorney General Eric Holder, our chief law officer, along with Director of National Intelligence James Clapper Jr., agreed to "new guidelines allowing the National Counterterrorism Center (NCTC)... to hold on to information about Americans in no way known to be connected to terrorism — about you and me, that is — for up to five years." Its previous limit was 180 days.
So, you or I would be a "person of interest" to the FBI and other intelligence agencies for five years."
So, you or I would be a "person of interest" to the FBI and other intelligence agencies for five years."
Separation of Art And State | David Boaz | Cato Institute: Commentary
Separation of Art And State | David Boaz | Cato Institute: Commentary: "Government involves the organization of coercion. In a free society coercion should be reserved only for such essential functions of government as protecting rights and punishing criminals. People should not be forced to contribute money to artistic endeavors that they may not approve, nor should artists be forced to trim their sails to meet government standards.
Government funding of anything involves government control."
"the NEA’s budget is about 0.2 percent of the total amount spent on the nonprofit arts in the United States. The rapidly growing crowdfunding platform Kickstarter expects to direct more funding to the arts in its third year of operation than the NEA does."
Government funding of anything involves government control."
"the NEA’s budget is about 0.2 percent of the total amount spent on the nonprofit arts in the United States. The rapidly growing crowdfunding platform Kickstarter expects to direct more funding to the arts in its third year of operation than the NEA does."
Because Angels Don't Govern Us | Michael D. Tanner | Cato Institute: Commentary
Because Angels Don't Govern Us | Michael D. Tanner | Cato Institute: Commentary: "the damage that government can do is far greater than the damage that can be done by business or individuals, because ultimately the state holds a monopoly on the use of force. If I make a mistake, it affects my life and perhaps the lives of my family and a few others. If a business makes a mistake, it can affect thousands more. But if government makes a mistake, it can affect everyone. That is what makes the growing reach of government so dangerous.
That means that, necessary though some restraint on the freedom of individuals and businesses may be, it is even more important to have internal and external controls on the power of government."
That means that, necessary though some restraint on the freedom of individuals and businesses may be, it is even more important to have internal and external controls on the power of government."
Geithner's Willful Negligence | Richard W. Rahn | Cato Institute: Commentary
Geithner's Willful Negligence | Richard W. Rahn | Cato Institute: Commentary: "While the IRS minimizes potential security issues, nonresident aliens are unlikely to feel reassured by promises that their information won’t fall into the wrong hands. These pledges could be met with apprehension when countries with questionable human rights records remain on the recipient list. This rule gives nonresident aliens every incentive to pick up and move their deposits elsewhere."
"There is more than $10 trillion in foreign-portfolio (stocks and bonds) investment in the U.S. This is not counting direct investment by foreign corporations and others. Much of this $10 trillion-plus is managed by foreign financial institutions. Now many of them are saying they are going to leave the U.S. market because of these regulations, which means the potential loss of several million U.S. jobs."
"There is more than $10 trillion in foreign-portfolio (stocks and bonds) investment in the U.S. This is not counting direct investment by foreign corporations and others. Much of this $10 trillion-plus is managed by foreign financial institutions. Now many of them are saying they are going to leave the U.S. market because of these regulations, which means the potential loss of several million U.S. jobs."
Let Student Loan Interest Rates Rise | Neal McCluskey | Cato Institute: Commentary
Let Student Loan Interest Rates Rise | Neal McCluskey | Cato Institute: Commentary: "right now a third of bachelor's holders of all ages are in jobs which don't require their credentials."
"Give everyone $100 to pay for higher education and colleges will raise their prices by $100, negating the value of the aid"
"Give everyone $100 to pay for higher education and colleges will raise their prices by $100, negating the value of the aid"
Group raises more than $70G for Texas honor student jailed for truancy | Fox News
Group raises more than $70G for Texas honor student jailed for truancy | Fox News: "Judge Moriarty told KHOU 11 News that he intended to make an example of Tran by placing her in jail.
"If you let one run loose, what are you going to do with the rest of them? Let them go, too?" Moriarty told the station."
They might work hard to provide for their family -- oh the horrors!
"If you let one run loose, what are you going to do with the rest of them? Let them go, too?" Moriarty told the station."
They might work hard to provide for their family -- oh the horrors!
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