That makes sense.
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Republicans don't understand Economics and it is killing the country
- Thread starter nitro
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I don't know, but as I recall their methodology is at least outlined on the website.Our gut feelings can easily be wrong. We have after all experienced a large decrease in gasoline prices. That could more than compensate for more modest increases elsewhere in the CPI.
Do you know if the MIT results incorporate hedonics? If they do then that could be a source of disconnect between our everyday experience and official figures. When we are at Safeway or Best Buy, or shopping on Amazon, or sitting in the Doctors Office, hedonics is the furthest thing from our minds.
Food is in fact up sharply, because demand is relentless and steadily growing, while supply has been hit hard lately. (If the trend in honeybee deaths continues I would expect food prices to rise still more.)
Its cool seeing a smart wall street guy clearly state what many of us non lefties have been saying for years.
I love how he says I not trying to blame the FED because they saved us... soft of... but then again it is their fault for the low interest rates prior.
I love how he says I not trying to blame the FED because they saved us... soft of... but then again it is their fault for the low interest rates prior.
The second half of the video is what is important. The first part is just an infomercial for Trump.
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you write as if greenspan or bernanke are not the puppet spokespeople for the shareholders who own the regional federal reserve banks. You should be analyzing this as a theatre critic not someone who thinks Greenspan was pulling on the levers of power. The levers were pushed on him.
Greenspan didn't mess up because of this philosophy. Greenspan was paid to allow wall street to make billions plus big bonuses by wrapping up increasingly risky loans as solid investments. They were selling premium and the Fed did what it could to be as irresponsible as possible as long as possible.
Bernanke and Yellen are also just paid spokespeople. They are media figure heads like Baghdad Bob with a banking background. The owners of the FED know what the Fed is going to do ahead of time because they tell them what to do.
Zero interest rates is their current trick to try and keep the party going. Ichan bus image is perfect. Yellen is being paid to push the bus with Fink. She is not going to stop pushing until Fink and the corny owners of the regional fed banks say so.
Greenspan didn't mess up because of this philosophy. Greenspan was paid to allow wall street to make billions plus big bonuses by wrapping up increasingly risky loans as solid investments. They were selling premium and the Fed did what it could to be as irresponsible as possible as long as possible.
Bernanke and Yellen are also just paid spokespeople. They are media figure heads like Baghdad Bob with a banking background. The owners of the FED know what the Fed is going to do ahead of time because they tell them what to do.
Zero interest rates is their current trick to try and keep the party going. Ichan bus image is perfect. Yellen is being paid to push the bus with Fink. She is not going to stop pushing until Fink and the corny owners of the regional fed banks say so.
Icahn is a smart guy, a guy with very good advice in my opinion, but maybe not as smart as he should be. I chalk that up to him being to busy with his own investment world to peel back enough layers of complexity to get down to the roots of problems. He mentions too low rates leading up to the financial crisis. And that is correct in my view. However raising rates has many side effects. Some desirable and others not so. Certainly a modest hike in rates was long in order before the crisis. But a combination of a small hike in rates coupled with tightening of mortgage underwriting [that's where the Fed failed us badly] was what was really needed no later than 2005. Also, the Fed should have left raising the margin requirement on the Table instead of taking it off, as Greenspan did. These tools should be used in a coordinated way.
In my personal opinion, the fundamental reason Bernanke was so much better than Greenspan as Fed Chairman, is that Bernanke knows well the difference between models and the real economy. If something was not working he was capable of rethinking the situation, whereas Greenspan was blinded by his ideology. He steadfastly believed that markets, if left alone, would correct excesses, more or less harmlessly, through market forces. He was horribly wrong! At least he has finally admitted some of his mistakes, but even there he's done a bad job of analyzing what went wrong. For example he has said that he was wrong to have thought that bankers would never act against their own self-interest. But at the time the bankers were getting rich securitizing and peddling junk mortgages as high quality CDOs it wasn't clear to them that they weren't acting in their best interests, and as a matter of fact it is still not clear. This statement by Greenspan stands as a confirmation of his belief in simple market equilibrium theory.
Nixon appointed Greenspan to his Council of Economic Advisors as a payoff for working on his election campaign. At the time of this appointment Greenspan was a competent professional musician, he had attended Julliard, studied economics, and was a partner in a NY investment advisory firm. His competence to serve on Nixon's Council was highly suspect. He moved quickly to cover up his embarrassing, on-paper deficiencies by earning a Ph.D. moonlighting at NYU. His mentor at NYU would have no doubt been happy to have Greenspan as his graduate student, as being the mentor to a member of the President's Council would have looked impressive on his own Vita. The real culprit was Reagan, who appointed Greenspan as Fed chairman. Just another in what proved to be unfortunate Reagan decisions regarding the economy. Here is a link to the most charitable article I could find re Greenspan's Ph.D. dissertation. http://www.barrons.com/articles/SB120917419049046805?mod=mktw#articleTabs_article=1
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He's got it somewhat backwards. Low rates at your corner bank were the result of oceans of petrodollars chasing returns.
No, you have it backwards. Investors 'chase' returns because they can't get a decent return on short term risk free money. That's what causes them to chase, dumby.
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Money is the result of production. It's what profits from production are retained in until it is either reinvested or used for consumption.
Then along comes a marxist with a better idea. Why not just give away money for free or create it out of thin air? That way there will be a lot more consumption.
Of course they never consider that people will grow tired of accumulating money the original way, by obtaining it from working and producing. Why would you work for money when they're giving it away for free elsewhere?
And thus an anemic economy is born. Why work.
Then along comes a marxist with a better idea. Why not just give away money for free or create it out of thin air? That way there will be a lot more consumption.
Of course they never consider that people will grow tired of accumulating money the original way, by obtaining it from working and producing. Why would you work for money when they're giving it away for free elsewhere?
And thus an anemic economy is born. Why work.
According to MIT's Billion Prices Project, which is basically an automated site scraper, the prices for goods and services advertised online, and the change in those, i.e. inflation, is quite close to that reported by the government CPI. Two different methods in use by two different entities arriving at the same conclusion.
That's interesting, but MIT gets a lot of government grants as well.