A striking, even stunning instance (FDO15 comment) of the culture of hostility to the very idea of governance that seems to have swept the disintegrating United States of America!
Witness this, today:
“EXCLUSIVE: Rep. Young Tells Constituent Who Gets Minimum Wage To ‘Get A Job’”
July 05, 2012 at 11:51 am
Regarding your link: maybe the fact that Rep. Young has spent 22 terms in Congress has something to do with his being “out of touch.” When you see something like that, it is real evidence for term limits.
Is MMR stll going?
Oh, absolutely. MMR has discovered the the big picture of “time” and its importance. Consider this: over the last 30 years productivity gains have soared and average wages have remained stagnant or even declined. Guess where those gains went, with income inequality levels not seen since 1929? But hey, guess what? You have a dishwasher and microwave. You now have more hours in the day to work longer hours (in the event you have a job), receive less pay, and retire later. Quit your whining while I (MMR) makes money off of money. Buck up!
Bottom-line: turns out there are still 24 hours in a day.
And the Higgs-Boson too.
phil and trixie, the fed has a monopoly over reserves and does set the price of reserves, ffr and dwr. given that the fed sets the price of reserves. it cannot control the quantity of reserves.
The folks who want to be in the flat earth society seem to have arrived in great force. The earth does look flat. So with money theories. The planet-world we inhabit is actually spherical in nature. MMT is not wishful thinking; like Galileo, MMT theorists describe what is, not what should be or what might be.
I have to say that I personally find this Libor scandal extremely difficult to understand.
Isn’t it something akin to our Federal Reserve, i.e., the banks clear their checks at night and if there is insufficient funds, they borrow from rival banks with more reserves? I think in this case, he said if the bank is perceived as weak, it gets charged a higher rate, and if strong a lower one. They then take a median average of rates of 8 banks and use that to establish the LIBOR. Now if any loan (not intra-bank loans but any loan) has an adjustable rate based on the LIBOR, you can see how the lowest rate or highest rate, used to calculate the rate monthly, weekly, or daily can increase or decrease profits. I think that was one of the obstacles Bernanke ran into in the housing market. Many rates in ARMs were not tied to the Federal Reserve rates, but rather to European rates (i.e. a contract might read “so many percentage points below/above LIBOR?’) and he ended up sending trillions to those banks for paper crap mortgages and derivatives therefrom because he could not get them to lower rates as he could banks in the Fed. I think Bill is saying that the top management has to be involved in manipulations because a detailed knowledge of the banks transactions at the time depends on whether high or low LIBOR benefits them the most. This is all speculation on my part and may be entirely wrong. It is ashamed that we can’t go on about our lives in whatever field we want to pursue. No! We gotta stop and try to figure out how the bankers are robbing us all today or how they robbed us yesterday!
Fraud at the highest levels will continue, http://market-ticker.org/akcs-www?post=208243
Especially when US and British governments decrease funding for regulatory oversight.
Pingback: US Bank regulator explains how Barclays manipulated the Libor Rates | Think Left
I’m not even going to try to disentangle the number of subjects you have conflated in your rambling, confused, incoherent jumble.
Commercial Banking entities setting interest rates is a separate series of topics from what the central bank does.
Are you still here? In the words of Scott Fullwiler a couple of weeks ago in response to another of your contentless head-bumps: don’t respond to this idiot.
A rant complaining about ranting.
“How can an entity have a monopoly when they do not set the price or quantity of the thing that they supposedly have a monopoly over?”
Right. MMT needs to get more in-line with MMR since their core foundation (and insight) is that the government can never “run out of money”. MMR shows this by proving ONLY “powerful facilitators” never “run out of money”. Money monopolists, on the other hand, “run out of money” like ALL the time.
Private entities controlling the money?
shall we all gather round the manor at harvest time as we turn in our offerings to the lord of the realm?
Strictly speaking, a monopolist doesn’t set the prices for the things he monopolizes, the prices are set almost entirely by the customer’s willingness/ability to pay. You can often tell a monopoly exists when there’s different prices for the exact same good/service depending on who you are or when you buy. Monopolists often auction their goods/services, because that way they can be sure they’re extracting the maximum amount of value from their customers for the good they supply. Look at it this way, if you were the monopoly car supplier, you could simply and arbitrarily set the price of cars at $1 million, but you won’t make much money because few people could afford to buy it. Or you could let the cars out for auction, at a rate that maintains their value to your customers, where the first car you sell might go for over $10 million, but the 99 millionth car you sell might go for little more than your costs of producing cars. The Federal Reserve bank creates dollars through auctions, exactly as one would expect a savvy monopolist would do.
It is vitally important that MMT describe what is above all. People have to understand the system before they can begin to understand how it works against them. They often “feel” that things aren’t right, that the system is rigged, yet at the same time they hold moral judgments about paying back loans to banks. I know of people who were underwater on a mortgage; they short-sold the house, and now the bank takes money out of their paycheck to supplement the payment of the new owners. Imagine that! There was a time when banks just repossessed the house and sold it for what the market would bear. Now, a bank gets to create credit for loans “out of thin air” and gets to charge interest on those digitally created funds–and if they repossess the house or convince people to “short sell,” they still get their pound of flesh from the previous homeowner. What a scam! If people realize that the money is all created out of thin air anyway, they suddenly feel no moral compunction to make sure the bank gets paid even before the children get shoes. But hey, they can work two or three jobs, can’t they? Bankers gotta eat too!
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