3 ms·
You may still be right, and I agree with a lot of what you say, but it is extremely difficult to see clearly through the rose-colored glasses of low interest ra
by mrslave 8y ago
You may still be right, and I agree with a lot of what you say, but it is extremely difficult to see clearly through the rose-colored glasses of low interest rates. And we have had very low interest rates for a very long time.
I tire of this very rarely being addressed. Both in boom and bust everyone is busy looking everywhere but the one single (central) policy that affects the value of half of every transaction conducted in an economy.
And GDP is overstated by the error in the proxy metrics for inflation (e.g. CPI) which I believe this is larger than most people estimate.
- Theodores 8y agoGDP is a funny measure. If an economy booms due to everyone thinking their houses are worth twice what they paid for them then is any 'product' grossly made domestically? I think that aliens would probably look on us much like we look on microbes in a petri dish. Ignoring the paper money there is energy and right now the taps are open and the oil is flowing. Thanks to fracking America now exports oil and we are not in some Mad Max world where oil is a scarce resource hoarded by those that have got it. The Peak Oil people were scared of twenty years ago is but a distant memory of a future that never happened. The 2008 QE printing of money kicked the can down the road. The reckoning still has to happen, capitalism cannot eat itself forever with GDP that is more to do with cannibalising industrial capitalism and becoming finance capitalism.
- sunir 8y agoGDP requires transactions. You can overvalue anything until you sell it. Then the reality is made bare.