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Let's talk about Economics

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posted on Apr, 16 2018 @ 12:33 PM
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a reply to: Flyingclaydisk




In reality, if you watch the price of a big stock offering the price per share will drop initially immediately following the offering. This is the same principle.


Hmmm, you sure about that? What principle?

Big stock offerings (can only assume you consider an IPO the same?) are rarely underwritten in-house -- buyback plans or splits are entirely different -- and nominally underpriced by the underwriter. Several studies have shown that IPOs do incredibly well "initially immediately following the offering."

At any rate, this seems a lot less about "economics" and more like 'spit-balling' -- I ain't hating, but this is one of those instances where knowing a subject 3 miles wide but only 3 inches deep bites you...I like economics and nerdy conversation, so I am just saying.

Usufruct is something you may want to research, it worked for millennia and has always fascinated my interest.




posted on Apr, 16 2018 @ 09:42 PM
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originally posted by: ScepticScot
a reply to: BeefNoMeat

The money multiplier erect is largely a Myth. Money creation by banks is driven by demand for credit, reserves are taken care of after the fact.


No, it's not. Not even remotely. Want the multiplier effect of in-kind payments? The multiplier effect of defense spending? I could go on and on, but I'll let you present me with the "erect is largely a Myth"...



posted on Apr, 16 2018 @ 09:51 PM
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a reply to: Flyingclaydisk




That extra $100 was derived from 'perceived' value, not from 'actual' value.


And therein lies your problem: you haven't even defined 'value'. Is it utilitarian/functional value (e.g. investing in stocks such that a company could invest in physical capital)? Is it intrinsic value (e.g. a beautiful sunset on the beach)? Lots of holes here in your understanding of economics...just sayin. Want to understand it better, don't start with 'history of economics' (the whole barter economy to buying stocks economy spiel) and leave out mercantilism....and a helluva lot more that preceded the whole "keep the stock value at $1 and conversely you now have a company worth $200, right? But is it really "worth" $200?" fallacious argument.



posted on Apr, 16 2018 @ 10:06 PM
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a reply to: ScepticScot




Not having a backed currency makes it easier to deal with financial crises and minimise the effect on the real economy. That's why 2008 was a financial crises not a second great depression.


Lol, wut?

The US dollar is absolutely backed -- by explicit guarantees decreed by the US Treasury. So you assert that the '08 great recession was minimized because principals and agents' of the economy had zero confidence in the legal tender-ability of the US to make good...sound reasoning. You can still buy gold with dollars. As you did note, currency is simply a means of exchange, but 'fiat' currency was developed for all kinds of conspiratorial reasons, the biggest of those conspiracies is that of the efficiency of exchange. But hey, I did see where you can buy gold sold in one-ounce packages that you can break off (looks like a gold Mr Good candy bar) and present to your local florist selling those Dutch tulips.



posted on Apr, 17 2018 @ 12:58 AM
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That is the Keynesian multiplier which is a different concept from money multiplier. One describes the effect of fiscal spending the other deals with fractional reserve banking.



posted on Apr, 17 2018 @ 01:04 AM
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originally posted by: BeefNoMeat
a reply to: ScepticScot




Not having a backed currency makes it easier to deal with financial crises and minimise the effect on the real economy. That's why 2008 was a financial crises not a second great depression.


Lol, wut?

The US dollar is absolutely backed -- by explicit guarantees decreed by the US Treasury. So you assert that the '08 great recession was minimized because principals and agents' of the economy had zero confidence in the legal tender-ability of the US to make good...sound reasoning. You can still buy gold with dollars. As you did note, currency is simply a means of exchange, but 'fiat' currency was developed for all kinds of conspiratorial reasons, the biggest of those conspiracies is that of the efficiency of exchange. But hey, I did see where you can buy gold sold in one-ounce packages that you can break off (looks like a gold Mr Good candy bar) and present to your local florist selling those Dutch tulips.


No I didn't assert that at all. The 2008 financial was minimized by the ability of government to both directly spend and introduce liquidity into the financial system (they should have done more of the former). This was done without any constraint based on amounts of shiny metal.

I am reasonably sure you understand what is meant by a backed a currency and no it doesn't just mean you can by stuff with it.
edit on 17-4-2018 by ScepticScot because: (no reason given)



posted on Apr, 17 2018 @ 11:35 PM
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Where's that circular argument meme at when I need it? Ugh.

Carry on, remind me about the steady-state assumption that doesn't exist in reality and then remind me about the semantics of your 'Keynesian' versus 'Fractional Reserve Banking' multipliers.

Sorry, bucko, google is your friend, but it's also an indictment of your attempts to play semantics and duck the reality of true macroeconomics. I mean, we can talk about the dearth of first-order solutions in normative policy and what are the most cost-effective second-order solutions that we deal with in mixed-economies, or you can keep banging on google for simple retorts. I'd rather talk economics, but it's your move.



posted on Apr, 18 2018 @ 12:45 AM
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originally posted by: BeefNoMeat
Where's that circular argument meme at when I need it? Ugh.

Carry on, remind me about the steady-state assumption that doesn't exist in reality and then remind me about the semantics of your 'Keynesian' versus 'Fractional Reserve Banking' multipliers.

Sorry, bucko, google is your friend, but it's also an indictment of your attempts to play semantics and duck the reality of true macroeconomics. I mean, we can talk about the dearth of first-order solutions in normative policy and what are the most cost-effective second-order solutions that we deal with in mixed-economies, or you can keep banging on google for simple retorts. I'd rather talk economics, but it's your move.


Not a circular argument and not semantics. Keynesian and money multiplier are two entirely separate concepts, something you apparently didn't understand.

Likewise you don't seem clear on what is meant by a backed currency.

Also my reference to steady state economy was in context of why a fixed amount of currency is not a good thing because that isn't reality.

Quite happy to talk economics but not convinced you are following the conversation.



posted on Apr, 18 2018 @ 12:56 AM
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a reply to: BeefNoMeat

To return to the original point the money multiplier is not an accurate description of how banks create money.

Banks extend loans based on the demand for loans from credit worthy customers. Reserves are taken care of after the fact.

Endogenous rather than exogenous money supply if you want to get geeky.



posted on Apr, 20 2018 @ 11:37 PM
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originally posted by: ScepticScot
a reply to: BeefNoMeat

To return to the original point the money multiplier is not an accurate description of how banks create money.

Banks extend loans based on the demand for loans from credit worthy customers. Reserves are taken care of after the fact.

Endogenous rather than exogenous money supply if you want to get geeky.


Get geeky with me all you want. I encourage it. As I told someone else in a thread, "google 'China global savings glut 2005'"...it speaks exactly of your description, "Banks extend loans based on the demand for loans from credit worthy [sic] customers"...if you pay attention to the chronology of the thread, you'll recognize that the 'loanable supply of funds' is directly related to money supply (again, myriad reasons) and that is the exactly the 'insuation' (maybe the poster knew or didn't -- my guess, they didn't, but that's neither here or there) that was being made*.

I appreciate your response(s), but there are levels to this, and you're not on my level, with all due respect.

*I'll let your inner-John Maynard Keynesian's to figure out the 'claim'.



posted on Apr, 20 2018 @ 11:44 PM
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great work, people will always go where the action is the fastest. Danger is ok if efficiency is the prize. Instant gratification is more important and just like water, the public will chase there action to the path of least resistance. Crypto is a great example of this.



posted on Apr, 21 2018 @ 02:52 AM
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originally posted by: BeefNoMeat

originally posted by: ScepticScot
a reply to: BeefNoMeat

To return to the original point the money multiplier is not an accurate description of how banks create money.

Banks extend loans based on the demand for loans from credit worthy customers. Reserves are taken care of after the fact.

Endogenous rather than exogenous money supply if you want to get geeky.


Get geeky with me all you want. I encourage it. As I told someone else in a thread, "google 'China global savings glut 2005'"...it speaks exactly of your description, "Banks extend loans based on the demand for loans from credit worthy [sic] customers"...if you pay attention to the chronology of the thread, you'll recognize that the 'loanable supply of funds' is directly related to money supply (again, myriad reasons) and that is the exactly the 'insuation' (maybe the poster knew or didn't -- my guess, they didn't, but that's neither here or there) that was being made*.

I appreciate your response(s), but there are levels to this, and you're not on my level, with all due respect.

*I'll let your inner-John Maynard Keynesian's to figure out the 'claim'.



You are right I am not on your level as I actually understand the terminology.

The savings glut theory doesn't in any way support the money multiplier theory (are you sure you get what it is now?).

Tell me what happened to the money multiplier post 2008 with increase in the monetary base?

With all due respect if you are going to try and be as arrogant as you are you need something to back it up.



posted on Apr, 21 2018 @ 04:58 AM
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originally posted by: ScepticScot

originally posted by: BeefNoMeat

originally posted by: ScepticScot
a reply to: BeefNoMeat

To return to the original point the money multiplier is not an accurate description of how banks create money.

Banks extend loans based on the demand for loans from credit worthy customers. Reserves are taken care of after the fact.

Endogenous rather than exogenous money supply if you want to get geeky.


Get geeky with me all you want. I encourage it. As I told someone else in a thread, "google 'China global savings glut 2005'"...it speaks exactly of your description, "Banks extend loans based on the demand for loans from credit worthy [sic] customers"...if you pay attention to the chronology of the thread, you'll recognize that the 'loanable supply of funds' is directly related to money supply (again, myriad reasons) and that is the exactly the 'insuation' (maybe the poster knew or didn't -- my guess, they didn't, but that's neither here or there) that was being made*.

I appreciate your response(s), but there are levels to this, and you're not on my level, with all due respect.

*I'll let your inner-John Maynard Keynesian's to figure out the 'claim'.





With all due respect if you are going to try and be as arrogant as you are you need something to back it up.









That's gold.
....literally...



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