Is it time to replace the Federal Reserve with a computer?

[LegendKiller]

Originally posted by: yllus
I'm actually sitting here a little amazed that someone could be as thick-skulled as you. People aren't disagreeing with you because they're "scared of change". People are disagreeing with you because your idea is stupid.

LOL. Then he pulls out the Taylor....HAH!

"Hey guys, lets create a formula that explains how to operate a global economy by only taking GDP and inflation differentials!"

Man, what a fucking moron. I wonder what he'd say about the global inflation arbitrage, or the Fed having no control over rates due to massive capital influxes. How would inflation not tied to rates, such as Ethanol and speculation figure into it?

Dari reminds me of a few professors I had going through grad school. They thought they could explain the world through formulas that only performed in a vacuum.

If only the world were so simple.

 

[Dari]

Originally posted by: yllus

Originally posted by: CallMeJoe
So: all we need is a more powerful computer than currently exists, an entirely disinterested financial/statistical/computing genius to program it, an equally disinterested genius to define and quantify all the variables to be included, an army of entirely disinterested auditors to collect the real-time data to enter, and a guarantee that politicians won't figure a way to cook the books for their own or their favorite lobbyists' advantage.

It sounds simple enough. When can we start?

lol, brilliant. More like an army of all of the above, though.

Originally posted by: Dari
I'm not sure what is so difficult to understand here. Perhaps some are scared of change.

I'm actually sitting here a little amazed that someone could be as thick-skulled as you. People aren't disagreeing with you because they're "scared of change". People are disagreeing with you because your idea is stupid.

And why is it stupid?

 

[Dari]

Originally posted by: LegendKiller

Originally posted by: yllus
I'm actually sitting here a little amazed that someone could be as thick-skulled as you. People aren't disagreeing with you because they're "scared of change". People are disagreeing with you because your idea is stupid.

LOL. Then he pulls out the Taylor....HAH!

"Hey guys, lets create a formula that explains how to operate a global economy by only taking GDP and inflation differentials!"

Man, what a fucking moron. I wonder what he'd say about the global inflation arbitrage, or the Fed having no control over rates due to massive capital influxes. How would inflation not tied to rates, such as Ethanol and speculation figure into it?

Dari reminds me of a few professors I had going through grad school. They thought they could explain the world through formulas that only performed in a vacuum.

If only the world were so simple.

And you are dumber for failing at reading. I'm surprised you even passed grad school since your reading skills are on par with a gnat. You asked about capital influxes before and I answered it. Here you are bringing it up again. That U. of Phoenix degree is shining through.

 

[LegendKiller]

Originally posted by: Dari

Originally posted by: LegendKiller

Originally posted by: yllus
I'm actually sitting here a little amazed that someone could be as thick-skulled as you. People aren't disagreeing with you because they're "scared of change". People are disagreeing with you because your idea is stupid.

LOL. Then he pulls out the Taylor....HAH!

"Hey guys, lets create a formula that explains how to operate a global economy by only taking GDP and inflation differentials!"

Man, what a fucking moron. I wonder what he'd say about the global inflation arbitrage, or the Fed having no control over rates due to massive capital influxes. How would inflation not tied to rates, such as Ethanol and speculation figure into it?

Dari reminds me of a few professors I had going through grad school. They thought they could explain the world through formulas that only performed in a vacuum.

If only the world were so simple.

And you are dumber for failing at reading. I'm surprised you even passed grad school since your reading skills are on par with a gnat. You asked about capital influxes before and I answered it. Here you are bringing it up again. That U. of Phoenix degree is shining through.

No, you didn't address it. Again, as *ALL* people here have pointed out, the variables included in figuring out liquidity movements for the world's largest economy, in relation to all other economies, isn't as simple as the Taylor formula or what you are proposing.

Let me ask you, do you work for one of the biggest banks in the world? Do you work in NYC doing securitization, other Corp. Fin i-banking, trading, or anything like that? Do you have your CFA charter? do you build large financial models, or just talk about them? I am quite curious, because I do all of those things and do it pretty damn well. Do not question my experience or knowledge by shuffling me off, especially when nobody else agrees with you.

It seems to me you're in the minority. On a whim, I even posted your question on a CFA board I frequent, they all laughed at it.

 

[Dufusyte]

As Ron Paul said in the debate, the role of the gov in economics is to provide a stable and effective currency. Beyond that, the gov should not take upon itself the task of "ensuring maximum employment" nor fixing interest rates. These latter are best left to the marketplace, where they will work themselves out.

Gov intervention in economy is inefficient and ineffective.

Meanwhile the Fed is a private institution, whose main goal is to enrich itself at the cost of the workers of the United States.

 

[Dari]

Originally posted by: LegendKiller

Originally posted by: Dari

Originally posted by: LegendKiller

Originally posted by: yllus
I'm actually sitting here a little amazed that someone could be as thick-skulled as you. People aren't disagreeing with you because they're "scared of change". People are disagreeing with you because your idea is stupid.

LOL. Then he pulls out the Taylor....HAH!

"Hey guys, lets create a formula that explains how to operate a global economy by only taking GDP and inflation differentials!"

Man, what a fucking moron. I wonder what he'd say about the global inflation arbitrage, or the Fed having no control over rates due to massive capital influxes. How would inflation not tied to rates, such as Ethanol and speculation figure into it?

Dari reminds me of a few professors I had going through grad school. They thought they could explain the world through formulas that only performed in a vacuum.

If only the world were so simple.

And you are dumber for failing at reading. I'm surprised you even passed grad school since your reading skills are on par with a gnat. You asked about capital influxes before and I answered it. Here you are bringing it up again. That U. of Phoenix degree is shining through.

No, you didn't address it. Again, as *ALL* people here have pointed out, the variables included in figuring out liquidity movements for the world's largest economy, in relation to all other economies, isn't as simple as the Taylor formula or what you are proposing.

Let me ask you, do you work for one of the biggest banks in the world? Do you work in NYC doing securitization, other Corp. Fin i-banking, trading, or anything like that? Do you have your CFA charter? do you build large financial models, or just talk about them? I am quite curious, because I do all of those things and do it pretty damn well. Do not question my experience or knowledge by shuffling me off, especially when nobody else agrees with you.

It seems to me you're in the minority. On a whim, I even posted your question on a CFA board I frequent, they all laughed at it.

You asked me and I said a special tax could be introduced to stop the influx without raising rates. Smart and simple.

OK. I'll give you the benefit of the doubt when it comes to the complexity of the national economy. But I ask (again), what can the Fed do that a computer cannot? If the Feds followed their own goals, they would've restricted money on a much faster basis than they did. We all know they're worry about employment but if you strip them of that duty their job would be a lot easier. Strip them of their political worries and their job would be even easier. That would leave them with only the data and rules to make a decision on where rates should be. A computer could easily do that.

I may not have your job experience but I'm a graduate from (soon to be) two ivy league universities. TBH, I've never been impressed with the working of the Federal Reserve. I've always believed that their job could be outsourced to computers. My friend interned there for several summers and the data he showed me validated my own thoughts. Now I'm hearing that there are computer programs for passing judgement on court cases. IMHO, if computers have come this far, I think they can do this.

And for the last time, I don't give a fuck about predictions. Interest rates are nothing more than a response to what the cost of money should be given the state of the economy. You guys are making this thing harder than it is. It's quite simple.

 

[BansheeX]

Originally posted by: LegendKiller

Originally posted by: BansheeX

Originally posted by: LegendKiller

Originally posted by: BansheeX
Not to mention that Wall Street is ahead of the working man in the inflation line when unbacked liquidity trickles down from the banks, meaning that Wall Street's disproportionate benefit is very much a result of the federal reserve and Keynesian policy.

Because these people standing in the soup line after they all lose their jobs after the financial markets collapse from a lack of liquidity.

I guess you didn't read anything about 1929.

Uhhh, Legend, don't look now but the Fed existed after 1913 and was the root cause of the great depression. Hyperinflation will have the same soup line result as mass deflation and too little money: too much money worth nothing. The great depression happened because of the Federal Reserve contracting the money supply and not following their own policies under the rules of the gold standard.

Was it the root cause of the GD? The Fed had marginal control over rates. The government effectively told them to drop them to allow GB's new gold backed currency to float without significant depreciation. The problem wasn't the Fed, it was the idea that we needed to be best buddies with GB.

The trigger point, contraction, was a reactionary measure demanded by politicians, agriculture groups, and bankers, because they didn't want the currency to depreciate against other currencies as the economy turned south.

They followed the rules of the gold standard quite well, protect value, limit inflation, at the cost of liquidity.

Aren't you arguing my case right there? The market wanted to do one thing, but a centralized decision maker under political pressure did another and it led to catastrophe. That is not possible without centralized pseudo-government control over the interest rate. By the way, the roaring 20s was a fed-created bubble in an effort to support the British pound. The trigger is the creation of the bubble, not the subsequent and inevitable correction that wanted to take place at the end of the decade. Don't confuse the two.

Also Friedman says that the gold from GB was supposed to create a new monetary structure but was simply sat on.

http://youtube.com/watch?v=O7pnjzCuSv8

Originally posted by: LegendKillerHow would inflation not tied to rates, such as Ethanol and speculation figure into it?

Inflation is purely a monetary phenomenon referring to an increase in the supply of money. Rising prices is the RESULT. As such, there is only one kind of inflation. There is no such thing as "asset-based inflation" etc. Common Keynesian mistake.

 

[LegendKiller]

Originally posted by: BansheeX
Aren't you arguing my case right there? The market wanted to do one thing, but a centralized decision maker under political pressure did another and it led to catastrophe. That is not possible without centralized pseudo-government control over the interest rate. By the way, the roaring 20s was a fed-created bubble in an effort to support the British pound. The trigger is the creation of the bubble, not the subsequent and inevitable correction that wanted to take place at the end of the decade. Don't confuse the two.

Also Friedman says that the gold from GB was supposed to create a new monetary structure but was simply sat on.

http://youtube.com/watch?v=O7pnjzCuSv8

Originally posted by: LegendKillerHow would inflation not tied to rates, such as Ethanol and speculation figure into it?

Inflation is purely a monetary phenomenon referring to an increase in the supply of money. Rising prices is the RESULT. As such, there is only one kind of inflation. There is no such thing as "asset-based inflation" etc. Common Keynesian mistake.

Isn't that what I said about the interest rate environment? That it was created by our government to prop up GB's currency? Christ, thanks for the tape recorder.... The gold standard itself sucked in setting rates, especially when the relative risk spread was higher and the according funding rates were higher, as a result of more volatility. Risk-adjusted returns over the last 100 years since the Fed has been in place have improved dramatically.


The idea that prices are only driven by currency devaluation is the most fucking idiotic thing I have ever seen. How can you ignore the actual *FACTS* in front of you now? Whereby *EVERY* commodity in the world, regardless of currency denomination, is skyrocketing. Not because the dollar is falling relative to other currencies, repricing items in terms of dollars.

You are so fucking dense it's ridiculous. Supply and demand of a good itself is inflation if the good's demand is inelastic and the price skyrockets. That alone feeds back into the price of all goods when that good underlys many others.

As we can see, skyrocketing oil costs, denominated in other currencies, are not due to an increase in supply of the dollar or inflation of those currencies, since those adjustments are built into PPP. It has *EVERYTHING* to do with increased speculation and inflation *OUTSIDE* of monetary adjustments.

 

[LegendKiller]

Originally posted by: Dari
You asked me and I said a special tax could be introduced to stop the influx without raising rates. Smart and simple.

OK. I'll give you the benefit of the doubt when it comes to the complexity of the national economy. But I ask (again), what can the Fed do that a computer cannot? If the Feds followed their own goals, they would've restricted money on a much faster basis than they did. We all know they're worry about employment but if you strip them of that duty their job would be a lot easier. Strip them of their political worries and their job would be even easier. That would leave them with only the data and rules to make a decision on where rates should be. A computer could easily do that.

I may not have your job experience but I'm a graduate from (soon to be) two ivy league universities. TBH, I've never been impressed with the working of the Federal Reserve. I've always believed that their job could be outsourced to computers. My friend interned there for several summers and the data he showed me validated my own thoughts. Now I'm hearing that there are computer programs for passing judgement on court cases. IMHO, if computers have come this far, I think they can do this.

And for the last time, I don't give a fuck about predictions. Interest rates are nothing more than a response to what the cost of money should be given the state of the economy. You guys are making this thing harder than it is. It's quite simple.

Because taxation has proved so effective in stopping crowding into opportunities. Are capital gains taxes not in place? I guess you missed where they were in place during the .bombs, housing, and now commodities.

Once you get into the real world, where you actually build your own models, look at the entire financial market, and realize the complexity, let me know. Otherwise you're a fucking babe in the woods.

Everybody here has disagreed with you, except for a couple libertopian fools. Those who know reality know it's not feasable and the entire premise is laughable since programming decisions takes politicized decisions, leading to the same outcome.

Thus you not only fail in understanding statistics, but also finance, economics, *AND* programming.

 

[drinkmorejava]

Actually, the fed has six broader goals:

1) Low Unemployment
2) GDP Growth
3) Price Stability
4) Interest Rate Stability
5) Financial Market Stability
6) FEX Market Stability

and a dual mandate for price stability and full employment

whereas the ECB has price stability and once it has achieved this it may work on ?general economic policies?

then add on nominal anchor stuff and time inconsistencies

And dear god, getting into monetary policy and the rise reduced form models because we can?t explain the no less than 7 major transmission mechanisms accurately in any other way

To say the fed has any specific job beyond keeping the economy from screwing itself getting harder these days

 

[Dari]

Originally posted by: LegendKiller

Originally posted by: Dari
You asked me and I said a special tax could be introduced to stop the influx without raising rates. Smart and simple.

OK. I'll give you the benefit of the doubt when it comes to the complexity of the national economy. But I ask (again), what can the Fed do that a computer cannot? If the Feds followed their own goals, they would've restricted money on a much faster basis than they did. We all know they're worry about employment but if you strip them of that duty their job would be a lot easier. Strip them of their political worries and their job would be even easier. That would leave them with only the data and rules to make a decision on where rates should be. A computer could easily do that.

I may not have your job experience but I'm a graduate from (soon to be) two ivy league universities. TBH, I've never been impressed with the working of the Federal Reserve. I've always believed that their job could be outsourced to computers. My friend interned there for several summers and the data he showed me validated my own thoughts. Now I'm hearing that there are computer programs for passing judgement on court cases. IMHO, if computers have come this far, I think they can do this.

And for the last time, I don't give a fuck about predictions. Interest rates are nothing more than a response to what the cost of money should be given the state of the economy. You guys are making this thing harder than it is. It's quite simple.

Because taxation has proved so effective in stopping crowding into opportunities. Are capital gains taxes not in place? I guess you missed where they were in place during the .bombs, housing, and now commodities.

Once you get into the real world, where you actually build your own models, look at the entire financial market, and realize the complexity, let me know. Otherwise you're a fucking babe in the woods.

Everybody here has disagreed with you, except for a couple libertopian fools. Those who know reality know it's not feasable and the entire premise is laughable since programming decisions takes politicized decisions, leading to the same outcome.

Thus you not only fail in understanding statistics, but also finance, economics, *AND* programming.

Last time I checked, taxation wasn't even tried in America. Only place I can think of is India.

And your arrogance is impressive considering you've been proven wrong before in this thread and you ran to your buddies elsewhere to get psychological backup. You calling others who disagree with you fools is also remarkable. You must have a high confidence of yourself.

I'm starting to feel sorry for you.

 

[LegendKiller]

Originally posted by: Dari

Originally posted by: LegendKiller

Originally posted by: Dari
You asked me and I said a special tax could be introduced to stop the influx without raising rates. Smart and simple.

OK. I'll give you the benefit of the doubt when it comes to the complexity of the national economy. But I ask (again), what can the Fed do that a computer cannot? If the Feds followed their own goals, they would've restricted money on a much faster basis than they did. We all know they're worry about employment but if you strip them of that duty their job would be a lot easier. Strip them of their political worries and their job would be even easier. That would leave them with only the data and rules to make a decision on where rates should be. A computer could easily do that.

I may not have your job experience but I'm a graduate from (soon to be) two ivy league universities. TBH, I've never been impressed with the working of the Federal Reserve. I've always believed that their job could be outsourced to computers. My friend interned there for several summers and the data he showed me validated my own thoughts. Now I'm hearing that there are computer programs for passing judgement on court cases. IMHO, if computers have come this far, I think they can do this.

And for the last time, I don't give a fuck about predictions. Interest rates are nothing more than a response to what the cost of money should be given the state of the economy. You guys are making this thing harder than it is. It's quite simple.

Because taxation has proved so effective in stopping crowding into opportunities. Are capital gains taxes not in place? I guess you missed where they were in place during the .bombs, housing, and now commodities.

Once you get into the real world, where you actually build your own models, look at the entire financial market, and realize the complexity, let me know. Otherwise you're a fucking babe in the woods.

Everybody here has disagreed with you, except for a couple libertopian fools. Those who know reality know it's not feasable and the entire premise is laughable since programming decisions takes politicized decisions, leading to the same outcome.

Thus you not only fail in understanding statistics, but also finance, economics, *AND* programming.

Last time I checked, taxation wasn't even tried in America. Only place I can think of is India.

And your arrogance is impressive considering you've been proven wrong before in this thread and you ran to your buddies elsewhere to get psychological backup. You calling others who disagree with you fools is also remarkable. You must have a high confidence of yourself.

I'm starting to feel sorry for you.

Cap gains and income taxes. What else do you want?

I don't need anybody else for "backup" nor did I invite anybody into the thread. They simply came because they smelled the blood of a fool in the water.

Thanks for feeling sorry for me, I needed the extra laugh. Although, it was a nice day in Manhattan, I ate a nice lunch on a sunny terrace and thought about how you're not even here, just for a split second though, I wouldn't waste any more energy on you than that.

 

[Dari]

Originally posted by: LegendKiller

Originally posted by: Dari

Originally posted by: LegendKiller

Originally posted by: Dari
You asked me and I said a special tax could be introduced to stop the influx without raising rates. Smart and simple.

OK. I'll give you the benefit of the doubt when it comes to the complexity of the national economy. But I ask (again), what can the Fed do that a computer cannot? If the Feds followed their own goals, they would've restricted money on a much faster basis than they did. We all know they're worry about employment but if you strip them of that duty their job would be a lot easier. Strip them of their political worries and their job would be even easier. That would leave them with only the data and rules to make a decision on where rates should be. A computer could easily do that.

I may not have your job experience but I'm a graduate from (soon to be) two ivy league universities. TBH, I've never been impressed with the working of the Federal Reserve. I've always believed that their job could be outsourced to computers. My friend interned there for several summers and the data he showed me validated my own thoughts. Now I'm hearing that there are computer programs for passing judgement on court cases. IMHO, if computers have come this far, I think they can do this.

And for the last time, I don't give a fuck about predictions. Interest rates are nothing more than a response to what the cost of money should be given the state of the economy. You guys are making this thing harder than it is. It's quite simple.

Because taxation has proved so effective in stopping crowding into opportunities. Are capital gains taxes not in place? I guess you missed where they were in place during the .bombs, housing, and now commodities.

Once you get into the real world, where you actually build your own models, look at the entire financial market, and realize the complexity, let me know. Otherwise you're a fucking babe in the woods.

Everybody here has disagreed with you, except for a couple libertopian fools. Those who know reality know it's not feasable and the entire premise is laughable since programming decisions takes politicized decisions, leading to the same outcome.

Thus you not only fail in understanding statistics, but also finance, economics, *AND* programming.

Last time I checked, taxation wasn't even tried in America. Only place I can think of is India.

And your arrogance is impressive considering you've been proven wrong before in this thread and you ran to your buddies elsewhere to get psychological backup. You calling others who disagree with you fools is also remarkable. You must have a high confidence of yourself.

I'm starting to feel sorry for you.

Cap gains and income taxes. What else do you want?

I don't need anybody else for "backup" nor did I invite anybody into the thread. They simply came because they smelled the blood of a fool in the water.

Thanks for feeling sorry for me, I needed the extra laugh. Although, it was a nice day in Manhattan, I ate a nice lunch on a sunny terrace and thought about how you're not even here, just for a split second though, I wouldn't waste any more energy on you than that.

I was referring to capital inflows. India taxed them and held them at bay. My university is also in Manhattan but I'm not there today. But that changes nothing.

 

[CitizenKain]

Originally posted by: BansheeX

Known socialists and fed apologists: LegendKiller, Evan Lieb, rchiu

Can you add me to your list of fed apologists? Maybe you could also add something like EVIL ZOG Members or something on there. I'd feel good to be on a list like that. I'd take being called a socialist too. To help:

Originally posted by: Dari
I may not have your job experience but I'm a graduate from (soon to be) two ivy league universities. TBH, I've never been impressed with the working of the Federal Reserve. I've always believed that their job could be outsourced to computers. My friend interned there for several summers and the data he showed me validated my own thoughts. Now I'm hearing that there are computer programs for passing judgement on court cases. IMHO, if computers have come this far, I think they can do this.

And for the last time, I don't give a fuck about predictions. Interest rates are nothing more than a response to what the cost of money should be given the state of the economy. You guys are making this thing harder than it is. It's quite simple.

Yea, all those people with actual experience and degrees in the field, like they know what is going on. They are just waiting for that maverick to come from no where and wave the magic wand at a server room and SHAZAAM, computers run our economy. Nothing more is required, magic is all we need.

 

[Dari]

And another thing about you. I remember many moons ago when you were having those debates between HD-DVD and Blu-ray. I was watching the way you formulated your arguments. You went on to focus about fundamentals and purchases and the influence of certain companies in the electronics industry. You spoke like you were oozing with arrogance and we should be only so happy to listen to you.

But for me it was all amusing. You see, why you were running your mouth about the numbers you forgot one HUGE factor that you probably haven't realized to this day: the international market. Outside of America, namely Japan and Europe, Blu-ray was winning by at least 80%. But you ignored all of that and kept on talking as if you were the man. That's why I say I feel sorry for you. You are arrogant.

 

[LegendKiller]

Originally posted by: Dari
And another thing about you. I remember many moons ago when you were having those debates between HD-DVD and Blu-ray. I was watching the way you formulated your arguments. You went on to focus about fundamentals and purchases and the influence of certain companies in the electronics industry. You spoke like you were oozing with arrogance and we should be only so happy to listen to you.

But for me it was all amusing. You see, why you were running your mouth about the numbers you forgot one HUGE factor that you probably haven't realized to this day: the international market. Outside of America, namely Japan and Europe, Blu-ray was winning by at least 80%. But you ignored all of that and kept on talking as if you were the man. That's why I say I feel sorry for you. You are arrogant.

ROFL, if there was one thing I didn't count on, it was how desperate Sony was to make sure Blu-Ray didn't fail. How much money did they offer Fox to stay Blu (It was truth they were going neutral) and how much did they offer WB to go blu (It was truth they were going HD DVD exclusive)?

It's going to take years for Sony to recoup the costs of BD, they spent 4bn+. I doubt they'll even be able to recoup it before it's replaced by another medium. But hey, it is what it is.

I may be arrogant but that doesn't make me incorrect. Everybody else sees that you're wrong. If that's true, then who is really the arrogant one?

 

[Dari]

Originally posted by: LegendKiller

Originally posted by: Dari
And another thing about you. I remember many moons ago when you were having those debates between HD-DVD and Blu-ray. I was watching the way you formulated your arguments. You went on to focus about fundamentals and purchases and the influence of certain companies in the electronics industry. You spoke like you were oozing with arrogance and we should be only so happy to listen to you.

But for me it was all amusing. You see, why you were running your mouth about the numbers you forgot one HUGE factor that you probably haven't realized to this day: the international market. Outside of America, namely Japan and Europe, Blu-ray was winning by at least 80%. But you ignored all of that and kept on talking as if you were the man. That's why I say I feel sorry for you. You are arrogant.

ROFL, if there was one thing I didn't count on, it was how desperate Sony was to make sure Blu-Ray didn't fail. How much money did they offer Fox to stay Blu (It was truth they were going neutral) and how much did they offer WB to go blu (It was truth they were going HD DVD exclusive)?

It's going to take years for Sony to recoup the costs of BD, they spent 4bn+. I doubt they'll even be able to recoup it before it's replaced by another medium. But hey, it is what it is.

I may be arrogant but that doesn't make me incorrect. Everybody else sees that you're wrong. If that's true, then who is really the arrogant one?

Wow, and you keep ignoring what I said. It was the international market that pushed Time Warner in that direction. Many Americans didn't even think about this because they felt that they were the center of the universe. Arrogance is not good.

 

[Dari]

Originally posted by: LegendKiller

Originally posted by: Dari
And another thing about you. I remember many moons ago when you were having those debates between HD-DVD and Blu-ray. I was watching the way you formulated your arguments. You went on to focus about fundamentals and purchases and the influence of certain companies in the electronics industry. You spoke like you were oozing with arrogance and we should be only so happy to listen to you.

But for me it was all amusing. You see, why you were running your mouth about the numbers you forgot one HUGE factor that you probably haven't realized to this day: the international market. Outside of America, namely Japan and Europe, Blu-ray was winning by at least 80%. But you ignored all of that and kept on talking as if you were the man. That's why I say I feel sorry for you. You are arrogant.

ROFL, if there was one thing I didn't count on, it was how desperate Sony was to make sure Blu-Ray didn't fail. How much money did they offer Fox to stay Blu (It was truth they were going neutral) and how much did they offer WB to go blu (It was truth they were going HD DVD exclusive)?

It's going to take years for Sony to recoup the costs of BD, they spent 4bn+. I doubt they'll even be able to recoup it before it's replaced by another medium. But hey, it is what it is.

I may be arrogant but that doesn't make me incorrect. Everybody else sees that you're wrong. If that's true, then who is really the arrogant one?

So you do admit to being arrogant. It's a start.

 

[LegendKiller]

Originally posted by: Dari

Originally posted by: LegendKiller

Originally posted by: Dari
And another thing about you. I remember many moons ago when you were having those debates between HD-DVD and Blu-ray. I was watching the way you formulated your arguments. You went on to focus about fundamentals and purchases and the influence of certain companies in the electronics industry. You spoke like you were oozing with arrogance and we should be only so happy to listen to you.

But for me it was all amusing. You see, why you were running your mouth about the numbers you forgot one HUGE factor that you probably haven't realized to this day: the international market. Outside of America, namely Japan and Europe, Blu-ray was winning by at least 80%. But you ignored all of that and kept on talking as if you were the man. That's why I say I feel sorry for you. You are arrogant.

ROFL, if there was one thing I didn't count on, it was how desperate Sony was to make sure Blu-Ray didn't fail. How much money did they offer Fox to stay Blu (It was truth they were going neutral) and how much did they offer WB to go blu (It was truth they were going HD DVD exclusive)?

It's going to take years for Sony to recoup the costs of BD, they spent 4bn+. I doubt they'll even be able to recoup it before it's replaced by another medium. But hey, it is what it is.

I may be arrogant but that doesn't make me incorrect. Everybody else sees that you're wrong. If that's true, then who is really the arrogant one?

Wow, and you keep ignoring what I said. It was the international market that pushed Time Warner in that direction. Many Americans didn't even think about this because they felt that they were the center of the universe. Arrogance is not good.

Yeah, let's see here....I could potentially make pittance on HD media (regardless of format) discs over the next 5 years if it wins, since it won't be a huge market for a long time (if at all). Or, I could make 150MM up-front, plus the pittance on Blu-Ray.

Hmmm, which to choose...which to choose.

I do like fact that you've lost this whole argument (everybody agrees with me, except your few Ron Paul loving libertopians), so you had to shift it to something else. An oblique attack, not to mention a decidedly personal one, in order to gain some shred of upper hand.

I don't need you to validate my existence, although it's nice you're trying. It's good to see you care enough. Thanks.

 

[Dari]

Originally posted by: LegendKiller

Originally posted by: Dari

Originally posted by: LegendKiller

Originally posted by: Dari
And another thing about you. I remember many moons ago when you were having those debates between HD-DVD and Blu-ray. I was watching the way you formulated your arguments. You went on to focus about fundamentals and purchases and the influence of certain companies in the electronics industry. You spoke like you were oozing with arrogance and we should be only so happy to listen to you.

But for me it was all amusing. You see, why you were running your mouth about the numbers you forgot one HUGE factor that you probably haven't realized to this day: the international market. Outside of America, namely Japan and Europe, Blu-ray was winning by at least 80%. But you ignored all of that and kept on talking as if you were the man. That's why I say I feel sorry for you. You are arrogant.

ROFL, if there was one thing I didn't count on, it was how desperate Sony was to make sure Blu-Ray didn't fail. How much money did they offer Fox to stay Blu (It was truth they were going neutral) and how much did they offer WB to go blu (It was truth they were going HD DVD exclusive)?

It's going to take years for Sony to recoup the costs of BD, they spent 4bn+. I doubt they'll even be able to recoup it before it's replaced by another medium. But hey, it is what it is.

I may be arrogant but that doesn't make me incorrect. Everybody else sees that you're wrong. If that's true, then who is really the arrogant one?

Wow, and you keep ignoring what I said. It was the international market that pushed Time Warner in that direction. Many Americans didn't even think about this because they felt that they were the center of the universe. Arrogance is not good.

Yeah, let's see here....I could potentially make pittance on HD media (regardless of format) discs over the next 5 years if it wins, since it won't be a huge market for a long time (if at all). Or, I could make 150MM up-front, plus the pittance on Blu-Ray.

Hmmm, which to choose...which to choose.

I don't need you to validate my existence, although it's nice you're trying. It's good to see you care enough. Thanks.

Oh I do care. And, like it or not, I may have the last laugh on this. Based on your posts I believe you work on Wall Street. Well, traders are becoming a rare breed aren't they? Electronic exchanges are taking their jobs. It may even take yours and the chairman of the Federal Reserve may have "intel inside."

I'll make you humble again.

 

[BansheeX]

Originally posted by: LegendKiller

Originally posted by: BansheeX
Aren't you arguing my case right there? The market wanted to do one thing, but a centralized decision maker under political pressure did another and it led to catastrophe. That is not possible without centralized pseudo-government control over the interest rate. By the way, the roaring 20s was a fed-created bubble in an effort to support the British pound. The trigger is the creation of the bubble, not the subsequent and inevitable correction that wanted to take place at the end of the decade. Don't confuse the two.

Also Friedman says that the gold from GB was supposed to create a new monetary structure but was simply sat on.

http://youtube.com/watch?v=O7pnjzCuSv8

Originally posted by: LegendKillerHow would inflation not tied to rates, such as Ethanol and speculation figure into it?

Inflation is purely a monetary phenomenon referring to an increase in the supply of money. Rising prices is the RESULT. As such, there is only one kind of inflation. There is no such thing as "asset-based inflation" etc. Common Keynesian mistake.

Isn't that what I said about the interest rate environment? That it was created by our government to prop up GB's currency? Christ, thanks for the tape recorder.... The gold standard itself sucked in setting rates, especially when the relative risk spread was higher and the according funding rates were higher, as a result of more volatility. Risk-adjusted returns over the last 100 years since the Fed has been in place have improved dramatically.


The idea that prices are only driven by currency devaluation is the most fucking idiotic thing I have ever seen. How can you ignore the actual *FACTS* in front of you now? Whereby *EVERY* commodity in the world, regardless of currency denomination, is skyrocketing. Not because the dollar is falling relative to other currencies, repricing items in terms of dollars.

You are so fucking dense it's ridiculous. Supply and demand of a good itself is inflation if the good's demand is inelastic and the price skyrockets. That alone feeds back into the price of all goods when that good underlys many others.

As we can see, skyrocketing oil costs, denominated in other currencies, are not due to an increase in supply of the dollar or inflation of those currencies, since those adjustments are built into PPP. It has *EVERYTHING* to do with increased speculation and inflation *OUTSIDE* of monetary adjustments.

http://inflationdata.com/Infla...ticles/Definitions.asp

The original definition of inflation quite clearly proves that I am correct in that inflation is referring specifically to an increase in the money supply. The influence of Keynesian economists lobbied and got it changed fairly recently to turn it on its head. Now government declared money in paper form, i.e. an easily created product backed by nothing with a coerced demand, can be lumped with all other goods so that they can better hide the price effects of manipulating its supply. See, there used to be a far clearer discrepancy between price fluctuations from actual market supply/demand and price fluctuations as a result of creating and contracting money.

 

[LegendKiller]

Originally posted by: BansheeX

Originally posted by: LegendKiller

Originally posted by: BansheeX
Aren't you arguing my case right there? The market wanted to do one thing, but a centralized decision maker under political pressure did another and it led to catastrophe. That is not possible without centralized pseudo-government control over the interest rate. By the way, the roaring 20s was a fed-created bubble in an effort to support the British pound. The trigger is the creation of the bubble, not the subsequent and inevitable correction that wanted to take place at the end of the decade. Don't confuse the two.

Also Friedman says that the gold from GB was supposed to create a new monetary structure but was simply sat on.

http://youtube.com/watch?v=O7pnjzCuSv8

Originally posted by: LegendKillerHow would inflation not tied to rates, such as Ethanol and speculation figure into it?

Inflation is purely a monetary phenomenon referring to an increase in the supply of money. Rising prices is the RESULT. As such, there is only one kind of inflation. There is no such thing as "asset-based inflation" etc. Common Keynesian mistake.

Isn't that what I said about the interest rate environment? That it was created by our government to prop up GB's currency? Christ, thanks for the tape recorder.... The gold standard itself sucked in setting rates, especially when the relative risk spread was higher and the according funding rates were higher, as a result of more volatility. Risk-adjusted returns over the last 100 years since the Fed has been in place have improved dramatically.


The idea that prices are only driven by currency devaluation is the most fucking idiotic thing I have ever seen. How can you ignore the actual *FACTS* in front of you now? Whereby *EVERY* commodity in the world, regardless of currency denomination, is skyrocketing. Not because the dollar is falling relative to other currencies, repricing items in terms of dollars.

You are so fucking dense it's ridiculous. Supply and demand of a good itself is inflation if the good's demand is inelastic and the price skyrockets. That alone feeds back into the price of all goods when that good underlys many others.

As we can see, skyrocketing oil costs, denominated in other currencies, are not due to an increase in supply of the dollar or inflation of those currencies, since those adjustments are built into PPP. It has *EVERYTHING* to do with increased speculation and inflation *OUTSIDE* of monetary adjustments.

http://inflationdata.com/Infla...ticles/Definitions.asp

The original definition of inflation quite clearly proves that I am correct in that inflation is referring specifically to an increase in the money supply. The influence of Keynesian economists lobbied and got it changed fairly recently to turn it on its head. Now government declared money in paper form, i.e. an easily created product backed by nothing with a coerced demand, can be lumped with all other goods so that they can better hide the price effects of manipulating its supply. See, there used to be a far clearer discrepancy between price fluctuations from actual market supply/demand and price fluctuations as a result of creating and contracting money.

Who sets the definitions and do they even understand the differentiation between input goods or services into inflation outside of traditional monetary inflation?

Ignoring inflation caused outside of monetary inflation is silly. It's plainly evident and should be counted.

You can live in the world of definitions and academia. I will live in reality.

 

[BansheeX]

Originally posted by: LegendKiller
Who sets the definitions and do they even understand the differentiation between input goods or services into inflation outside of traditional monetary inflation?

Ignoring inflation caused outside of monetary inflation is silly. It's plainly evident and should be counted.

You can live in the world of definitions and academia. I will live in reality.

Relative value changing between goods as a result of supply and demand is not inflation. There is no magic term for that, it's just "rising/falling prices resultant of supply/demand." Inflation/deflation is referring (or used to) entirely on the money supply being issued by government. If you know the difference between fiat paper and a real commodity, then that's the first step to understanding this. Changing inflation to mean its most common result confounds the entire purpose of the original definition, because rising and falling prices can be caused from natural market occurrences as well. It effectively diverts attention away from what the government is creating and spending, so that dummies like you can go around blaming ethanol for everything. The fed also got rid of the M3, which was a money supply gauge, and changed the CPI in the 90s to understate inflation even further. They are trying to make what they're doing more confusing and less transparent. Because if no one knows wtf they are saying with roundabout nonsense like "cost-push" and "demand-pull" jargon, no average American is going to be able to decipher these people's explanations. They'll blame rising prices on the products themselves, lack of regulation, anyone but the fed and government spending debasing the dollar relative to everything else including foreign currencies.

 

[Dari]

I knew I was right:

Ludwig von Mises Institute

Austrian Business Cycle

Taking Hayek Seriously

 

[The-Noid]

Originally posted by: LegendKiller

Originally posted by: Dari

Originally posted by: LegendKiller

Originally posted by: Dari
I'm not even sure why you brought in the sub-prime mess into this topic and yet forget to mention the Feds' actions, which is precisely why I made this proposal. Look at the market before and after the subprime implosion. Before, the Feds was slow to cut rates. After, it's cutting it like there's no tomorrow. This is part of the problem and you fail to mention it. Easy money is part of the problem and the Fed is guilty of that. Take away the human factor (political pressure, worries about employment, and errors) and you'll have a more stable inflation targeting regime.

Oh, and try not to insult people when you don't even know who they are.

You simply don't get it. The Fed trying to cut rates in the face of $20TR flooding into the market is akin to pissing into the wind of a Cat5 hurricane. The Fed had absolutely no control over that money, it was risk-spreads that cut funding costs, not benchmark rates for short-term securities between banks, which is what the Fed sets.

Look at right now, if the Fed had control over long-term rates, then you'd see mortgage rates collapse. HOwever, they have barely moved. Why? Because risk-premium have skyrocketed. I know many funding deals which I have looked at which priced from 55bps last year to over 250bps this year. That's a funding increase of 190bps, which completely cancels the Fed's actions.

I know another consumer loan deal that funded at 50bps all-in last year and is now going to fund at 400bps this year, net-net, over swaps, that's a 200bps funding cost increase. That's passed onto consumers.

The Fed has no control over that, it's the global financial markets which provide liquidity that sets the market. Those markets cannot be predicted by simple regression. It'd require tens of thousands of variables, all adjusting within a moments notice, all plugged into the entire market's psychology.

There is a reason why the markets are called "random walks", it's because you can't predict the future. If you could, then systematic risk would be 0 and the returns on the market would collapse down to risk-free rates.

Take away the "human factor"? ROFL, the human factor is what MAKES this market variable, which is the exactly what you fail to understand.

Go read up on Behavioral Finance books, I have read dozens. I don't give a crap who you think you are, your ideas are parochial at best and anybody in a remedial financial analysis and modeling class would know you're barking up the wrong tree.

And you keep missing my point. If the Fed had been less politicised and less worried about employment, it would've put the squeeze when the economy was at it's hottest. Of course, basic economics also says that governments should raise taxes at such times as well to use them when the economy is in a recession, but people also ignore that. The whole point of a truly independent Federal Reserve would be to nip these problems in the bud before they are allowed to grow. If we let the Feds worry only about inflation and stable prices, the politicians worry about job creation, the treasury worry about debt, and various other agencies worry about regulation, then I'd believe we'd have a more sedate boom-bust cycle. It may not be interesting, but it shouldn't be.

An ounce of prevention is worth a pound of cure.

I see your point, but it's flat out wrong. The Fed could have raised rates to 6% and it wouldn't have mattered. Long-term rates set housing funding costs, not short-term rates. Long-term rates are set by the market, not by the Fed. If the market is flooded with capital it will drive down risk-spreads, as it did.

Not to mention that the biggest problem currently is not long-term rates themselves, but creative financing, which the Fed has no control over.

You blame the Fed and imagine a computer would solve the problem. I blame the market and say that a computer is as fallible, if not more, than humans.

Humans program computers, but adjust on a moments notice. Computers cannot adjust and still rely on humans to program. Thus you add in two levels of fallibility, not just one.

Boom/bust cycles have existed throughout humanity and cannot be controlled by funding rates. I would think that history has proven this to most people. Look at the Tulip case.

Via open market operations they could have purchased short term securities and sold long term securities thus causing spots to go up. They also can impact any part of the curve they want by splitting the 30-years they have into STRIPs and selling those to flood that part of the curve. These are short term solutions and have not been attempted in modern day times, but that does not mean it is not possible. On the run treasuries in the long end of the curve were still a small percentage of the overall market during the credit boom of 2003-2007. They could have theoretically moved the curve quite far without even stressing their at the time 500-700B balance sheet.

Obviously, you can also raise the curve very easy by levering up on the forward rate futures if you have that size balance sheet. Just because they chose not to and I agree there was no model in the world to say that CMO's and CDO's and other derivatives would explode, does not mean the central bank could not have.