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I'm not disagreeing on the point but you've failed to connect "track" to "rob". Also, Greenspan was clearly a Keynesian - and, IMO, rather/depressingly naive

by bmh_ca 9y ago

I'm not disagreeing on the point but you've failed to connect "track" to "rob". Also, Greenspan was clearly a Keynesian - and, IMO, rather/depressingly naive or proud, from his bio. Smart guy, horse blinders.

dnautics 9y ago
well inflation generally robs the poor (and everyone else[0]) of the value of their money. By rob, I mean 'nonconsensually alter in the negative direction relative to the natural state'. Technology is supposed to be the 'tide that lifts all boats'. What few people understand is that the primary mechanism by which it does this is by lower prices, because that doesn't fit the narrative of "deflation is bad for poor people" (it's not). I suppose it's a bit loose to say that the poor are entitled to ameliorative effects of technology - but they are entitled to not be cheated by the government, and if they weren't cheated by the government then they would be enjoying a higher quality of life from lower prices. Yes, obviously Greenspan acted as a Keynesian, but he was trained and continues to believe himself a monetarist. That's the point. Monetarism still believes in the seductive idea that stability can be achieved by fiddling with the money supply - they just would prefer to relegate it to some computer program or something algorithmic, but that STILL encodes the normative biases of the individuals who choose the criteria for the algorithms. So even if you could have a 'top man' in place that is so virtuous or autistic as to keep his hands off the dials during crises, it would STILL screw the poor. Point being: There's no categorical difference between a Keynesian and a Monetarist, just a matter of degree of recklessness. [0] but other people have means to protect themselves from inflation, mostly investments which yield higher than inflation. Really rich people benefit greatly from leveraged financial instruments, which are tougher in a deflationary regime. In other words, via inflation we are stealing from the poor to make it easier for the wealthy to get really wealthy, and it seems the recurring pattern when society gets overleveraged, the solution is to bail out the really wealthy - socializing the pain of risk.
- bmh_ca 9y ago
  > Monetarism still believes in the seductive idea that stability can be achieved by fiddling with the money supply I think you've hit the nail on the head. This is my belief as well; while it is apparent that monetary policy can be useful, the old adage goes "if all you have is a hammer, everything starts to look like a nail". It appears that instead of doing the correct (and politically difficult) thing from a fiscal, tax, and policy perspective, we just keep lowering the interest rates and waiting for the next upswing. Which where the Chilean experiment[1] with apolitical fiscal policies will be interesting to observe. I've not seen much on it since, but it'll certainly be tested in the not too distant future. [1] http://www.economist.com/blogs/freeexchange/2013/10/fiscal-policy-0 http://www.economist.com/blogs/freeexchange/2013/10/fiscal-p...

by bmh_ca 9y ago

dnautics 9y ago

well inflation generally robs the poor (and everyone else[0]) of the value of their money. By rob, I mean 'nonconsensually alter in the negative direction relative to the natural state'. Technology is supposed to be the 'tide that lifts all boats'. What few people understand is that the primary mechanism by which it does this is by lower prices, because that doesn't fit the narrative of "deflation is bad for poor people" (it's not). I suppose it's a bit loose to say that the poor are entitled to ameliorative effects of technology - but they are entitled to not be cheated by the government, and if they weren't cheated by the government then they would be enjoying a higher quality of life from lower prices. Yes, obviously Greenspan acted as a Keynesian, but he was trained and continues to believe himself a monetarist. That's the point. Monetarism still believes in the seductive idea that stability can be achieved by fiddling with the money supply - they just would prefer to relegate it to some computer program or something algorithmic, but that STILL encodes the normative biases of the individuals who choose the criteria for the algorithms. So even if you could have a 'top man' in place that is so virtuous or autistic as to keep his hands off the dials during crises, it would STILL screw the poor. Point being: There's no categorical difference between a Keynesian and a Monetarist, just a matter of degree of recklessness. [0] but other people have means to protect themselves from inflation, mostly investments which yield higher than inflation. Really rich people benefit greatly from leveraged financial instruments, which are tougher in a deflationary regime. In other words, via inflation we are stealing from the poor to make it easier for the wealthy to get really wealthy, and it seems the recurring pattern when society gets overleveraged, the solution is to bail out the really wealthy - socializing the pain of risk.

bmh_ca 9y ago
> Monetarism still believes in the seductive idea that stability can be achieved by fiddling with the money supply I think you've hit the nail on the head. This is my belief as well; while it is apparent that monetary policy can be useful, the old adage goes "if all you have is a hammer, everything starts to look like a nail". It appears that instead of doing the correct (and politically difficult) thing from a fiscal, tax, and policy perspective, we just keep lowering the interest rates and waiting for the next upswing. Which where the Chilean experiment[1] with apolitical fiscal policies will be interesting to observe. I've not seen much on it since, but it'll certainly be tested in the not too distant future. [1] http://www.economist.com/blogs/freeexchange/2013/10/fiscal-policy-0 http://www.economist.com/blogs/freeexchange/2013/10/fiscal-p...