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The problem was that central planners reduced rates to near zero in the face of adversity, instead of using fiscal policy more aggressively as you suggest - exc

The problem was that central planners reduced rates to near zero in the face of adversity, instead of using fiscal policy more aggressively as you suggest - except instead of taxing negative externalities, they should have subsidized positive externalities so relying less on rates. Now we need to get rates back to a sensible place (roughly 5%) so that risk/time is correctly priced and we don't have exorbitant asset bubbles.

dragonwriter 4y ago
> The problem was that central planners reduced rates to near zero in the face of adversity, instead of using fiscal policy more aggressively as you suggest The people who make decisions about interest rates have no authority over fiscal policy, and the people that control fiscal policy (who theoretically could cobtrol monetary policy as well) have segregated themselves from interest rate decisions in large part to avoid fears that they will monetize the debt undermining confidence im the currency.
- somewhereoutth 4y ago
  Indeed, however governments could set the terms of reference for the central banks for rates to be more 'sticky'.
EGreg 4y ago
In my opinion, rates near zero and no bank bailouts allow the market to price the actual rates depending on how well a bank is doing. In fact I'd prefer everything to be on-chain rather than credit rating agencies being months behind. Especially if the Fed is raising rates so quickly! In fact, I'd prefer UBI to be phased in as an alternative to the banking system, together with corresponding taxes on negative externalities. Like this: https://en.wikipedia.org/wiki/Carbon_fee_and_dividend https://en.wikipedia.org/wiki/Carbon_fee_and_dividend When Andrew Yang ran, I met with his campaign and made https://yang2020.app https://yang2020.app for them. I really asked them to be a TWO-issue campaign, tying the UBI to carbon taxes, but he never did that. So he didn't have a good answer to "how are we going to pay for it". And to this day, the Forward Party needs to make a good case for it. I don't believe these kinds of things can be done at the national level, which is why I started Intercoin: https://community.intercoin.app/t/new-ubi-movement-mayors-cities-and-countries https://community.intercoin.app/t/new-ubi-movement-mayors-ci...
- somewhereoutth 4y ago
  I am also a supporter of UBI, however I think much of it should be benefits in kind (universal healthcare, free libraries, decent schools, etc, etc), and perhaps the rest can be structured as a Universal Basic Stake - kindof like a pension scheme that you are already paid into just by being born. Financed by swinging wealth taxes to form a sovereign wealth fund, that is then deployed in the usual capitalistic manner.
oarabbus_ 4y ago
>The problem was that central planners reduced rates to near zero in the face of adversity, instead of using fiscal policy more aggressively as you suggest Why was reducing rates in response to the COVID crisis a "problem"?

dragonwriter 4y ago

> The problem was that central planners reduced rates to near zero in the face of adversity, instead of using fiscal policy more aggressively as you suggest The people who make decisions about interest rates have no authority over fiscal policy, and the people that control fiscal policy (who theoretically could cobtrol monetary policy as well) have segregated themselves from interest rate decisions in large part to avoid fears that they will monetize the debt undermining confidence im the currency.

somewhereoutth 4y ago
Indeed, however governments could set the terms of reference for the central banks for rates to be more 'sticky'.

EGreg 4y ago

In my opinion, rates near zero and no bank bailouts allow the market to price the actual rates depending on how well a bank is doing. In fact I'd prefer everything to be on-chain rather than credit rating agencies being months behind. Especially if the Fed is raising rates so quickly! In fact, I'd prefer UBI to be phased in as an alternative to the banking system, together with corresponding taxes on negative externalities. Like this: https://en.wikipedia.org/wiki/Carbon_fee_and_dividend https://en.wikipedia.org/wiki/Carbon_fee_and_dividend When Andrew Yang ran, I met with his campaign and made https://yang2020.app https://yang2020.app for them. I really asked them to be a TWO-issue campaign, tying the UBI to carbon taxes, but he never did that. So he didn't have a good answer to "how are we going to pay for it". And to this day, the Forward Party needs to make a good case for it. I don't believe these kinds of things can be done at the national level, which is why I started Intercoin: https://community.intercoin.app/t/new-ubi-movement-mayors-cities-and-countries https://community.intercoin.app/t/new-ubi-movement-mayors-ci...

somewhereoutth 4y ago
I am also a supporter of UBI, however I think much of it should be benefits in kind (universal healthcare, free libraries, decent schools, etc, etc), and perhaps the rest can be structured as a Universal Basic Stake - kindof like a pension scheme that you are already paid into just by being born. Financed by swinging wealth taxes to form a sovereign wealth fund, that is then deployed in the usual capitalistic manner.

oarabbus_ 4y ago

>The problem was that central planners reduced rates to near zero in the face of adversity, instead of using fiscal policy more aggressively as you suggest Why was reducing rates in response to the COVID crisis a "problem"?