Linking ≠ endorsement.
⇧ How Taxpayers Subsidize Rebuilding Homes After Flooding... Repeatedly
... nearly 37,000 properties from the Carolinas to California have repeatedly flooded and been rebuilt — some dozens of times — with help from a federal insurance program that is, itself, financially underwater.
Declare the repeatedly flooded properties total losses, and pay the owners to move.
⇧ PG&E Decided Not to Cut Power as Winds Raged Before California Wildfire
Could the system be retrofitted with sensors and automatic breakers at all towers so lines that break will instantaneously have no current? The sensor down the line signals there's no current, so the breaker up the line pops.
⇧ Highest number of unsold new homes on market since 2009: Report (Video)
Add your comment. Including the article/link number will help.
⇧ Stock market's selloff is only half-done, and final leg will come in 2019, warns Morgan Stanley strategist
... Fed Vice Chairman Richard Clarida on Tuesday confirmed that the central bank will press ahead with gradual rate increases but will remain flexible as "monetary policy is not on a preset course."
We knew that, but why are they planning to cause a downturn?
⇧ GM Announcement Confirms Tax Cuts Don't Prevent, May Encourage Layoffs
The corporate tax cuts pushed through by the Trump Administration last fall appear to have had little if any positive effect on the U.S. economy. In the 11 months since the so-called Tax Cuts and Jobs Act was enacted, publicly available data have shown that Fortune 500 corporations have used their tax cuts overwhelmingly to repurchase stock rather than to create new jobs or invest in capital infrastructure.
Matthew Gardner thinks those who pushed the cuts didn't know that's what would happen. He takes them at their word that they thought the cuts would boost investments and jobs. Well, the rest of us said what has happened would happen and that the reason for the cuts was the same as always: jack up the budget deficit and blame welfare, Social Security, Medicare, and Medicaid and call for massive privatization.
⇧ Getting Warmer: Insurance and Climate Change
Because the effects of climate change have the potential to cause significant disruption to the insurance industry, prominent members of the insurance industry have started taking climate change seriously.
As my readers know, I've been waving the global-warming red flag for a very long time.
⇧ Half of Colorado Population Faces Wildfire Risk
The Colorado State Forest Service said 2.9 million people now live in the wildland-urban interface, defined as places where homes are built in or near areas that are prone to wildland fire.
⇧ Fed warns that a 'particularly large' plunge in market prices is possible if risks materialize
It appears the Fed may finally be catching on. What took them so long, as if we didn't know.
⇧ Fed chair sends markets soaring with suggestion that rate hikes may slow
No mention of continuing labor-slack, very slow wage growth, and the corporate-tax cuts and share-buyback frenzy.
⇧ Pressure mounts to bury carbon emissions, but who will pay?
Regenerative-soil practices will capture a great deal more than will trees, but this carbon capture and storage (CCS) method is something we can't simply dismiss out of hand while so few "leaders" appear to appreciate the seriousness of global warming.
⇧ Experts aren't buying the White House's spin on an authoritative climate report
It's not my goal to hurt anyone's feelings with the following. It's depressing, even sickening, that so many people are stubbornly holding onto the position that carbon burning raising CO2 in the atmosphere isn't increasing warming and isn't causing greater weather extremes and damage, etc. I think for many, it may now be that their egos are getting in the way of reason. They simply don't want to admit they've been wrong. For others, they have vested economic interests in denying what I think many of them know to be true.
How long did it take the same people to admit that cigarettes cause lung cancer? The same thing is happening with global warming only worst. People started admitting cigarettes cause lung cancer once the internal documents of the tobacco industry leaked out showing that they knew all along. Well, internal documents from the carbon-fuel industry have leaked showing many have known that carbon burning causes global warming. So, what's different this time? The carbon-fuel industry never let up on the denial message. Why are the People putting up with it? I think it's ideology.
⇧ November 20, 2018: CoreLogic Reports Strong Employment Growth is Driving Low-to-Mid Tier Rent Price Increases
Low rental home inventory, relative to demand, fuels the growth of single-family rent prices. ...
Metro areas with limited new construction, low rental vacancies and strong local economies that attract new employees tend to have stronger rent growth. Both Phoenix and Orlando experienced high year-over-year rent growth in September 2018, driven by employment growth of 3.8 percent and 5.9 percent year over year respectively.
⇧ Money Manager Demand Is Expected to Set the Tone for Mortgages in 2019
Raising interest rates isn't the only headwind the Fed can create. Unwinding the Fed balance sheet in ways that can't be absorbed by the private sector can dampen growth and even cause a recession.
⇧ Report: Pennsylvania Fire, Rescue Services Face Crisis
... there were about 300,000 volunteer firefighters in the state in the 1970s, a number that's fallen to about 38,000 currently.
Plenty of volunteers in 1970 had solid middle-class incomes working at blue-collar jobs, but many of those jobs were exported solely so top executives could make 10 times more money, indexed for inflation too.
Pay fire fighters what they're worth to society: plenty. A single fighter's income should support an entire family at a decent standard of living.
Yes, robot fire-fighters will come on line, but we should pay the humans now and provide a solid safety net for when the bots take over the dangerous work.
⇧ North Carolina Requests $8.8B in Florence Recovery Funds from Congress
If approved, the federal funding would make up for about half the total $17 billion in damage from September's historic rains and flooding.
⇧ Key findings about U.S. immigrants
Are you an immigrant? How many of your tenants are immigrants? How much do you know about immigration into the US?
This polling and associated statistical data should help increase your knowledge.
⇧ What Is Money? Why Pay Taxes? [Solid article by J. David Stein]
When I start reading articles such as this one, I'm always wondering where it will end up. This one, pleasantly, is excellent. The only thing I'd tweak for the general public is that there are alternatives to taxes to adjust inflation. I'd also mention grassroots democracy as the means to keep things in balance while revving up real productivity.
Under the new tax code, they can expense (depreciate) all of their assets through 2022. So the new tax law gives businesses an incentive to invest in new projects.
They have real choices. They can invest in the economy, or they can continue to increase income inequality by using their higher after-tax income to pay shareholders more dividends or buy back stock, which they have done much of over the years.
They could do other things. They could lower prices, which would be a real benefit to their customers. They could help reduce income inequality by using their increased funds to pay their employees higher wages.
⇧ Climate Crisis Made Worse By Presidential Mis-Leadership Throughout This Century
Sometimes radicals are right. This is such a case:
As bad as previous presidents have been, President Trump's climate denial policies have reached a new low for presidential misleadership.
⇧ Things of Internet: How smart devices fail because of their Web dependence
And you thought (make that we) security was the major issue with the IoT.
Frankly, I don't understand designing anything quite yet that's for common household usage where you have to be connected to the Internet just to turn your lights on when you're standing right there looking at the light fixture.
⇧ Massive Earthquake Shakes Alaska, Hitting Roads And Bridges Hard
Building-code deniers remind me of global-warming deniers. That's why I like article such as this one.
Smart building codes always save more than they cost!
The fact that we went through something this significant with this minimal amount of damage says that we're a very well-prepared community, that our building codes and our building professionals have done a terrific job ....
⇧ Ranchers Combat Overgrazing to Protect Climate
"All your profit comes from the soil," he added.
He stood in a field where cattle had recently been grazing, but you'd never know it. The grass still stood tall. His neighbors don't understand why he doesn't let the cows graze it all the way down. They think he's wasting it.
"We get phone calls where people want to drive a bailer in here and bail up this grass, but they don't realize the positives that come by leaving it standing," he said.
The field grows more grass when cattle are moved off it sooner. That means Vance buys less feed.
Even if it's more profitable, it's not easy for people to change their ways, and ranchers are a conservative bunch.
"You realize things that you were raised doing, things that your dad and your granddad did, maybe weren't the best things to do," Vance said, "from an environmental perspective, maybe from even a profitability perspective."
There's overgrazing, but there's also undergrazing. Balance is the right approach.
⇧ Maria had $43B impact on Puerto Rico's economy
... the Category 4 storm hit in September 2017, causing more than an estimated $100 billion in damage.
⇧ California wildfire survivors face new challenge: rebuilding
Working out of truck trailers, temporary tents and recreational vehicles in mall parking lots, and equipped with generators and satellite communications, insurance adjusters say they have been stymied in part by a ban on flying drones over what is left of the town of 27,000.
Insurers responding to natural disasters typically use drones to obtain 360-degree views of damage when access is limited. But the drones have been restricted as crews work to clear downed trees and power lines, as well as burn debris and restore infrastructure.
It's very difficult to tell people to be patient while their lives are on hold, at best. Unfortunately, insurance companies are limited by what they can do in such major catastrophes. They are getting better at it, but they can never be fast enough when people are used to things happening instantly on the Internet.
⇧ Economic chill dulls Chinese appetite for some luxury brands
When does this happen except for during a recession?
⇧ Dollar weak as U.S. Treasury yield curve inversion sparks recession fears
The Fed didn't cause this. The corporate-tax cuts did. However, the Fed could exacerbate it. Will it?
⇧ Employment outlook for occupations that don't require a formal educational credential
Just because they don't make a great deal of money or have a high level of formal education doesn't mean they don't work hard for what they earn.
⇧ New York's 10 biggest property owners
Vornado Realty Trust: With nearly 30 million square feet ....
⇧ Who owns what in nyc?
There's a movement against landlords being able to hide that they own specific properties. It may take some time before it filters through the system. However, a good rule of thumb is to engage only in landlord activities you'd not be ashamed of being made public.
⇧ California senator reintroduces contentious transit density bill
One of the most hotly contested issues was the perception that the bill didn't adequately take into consideration low-income citizens. Opponents argued the bill didn't offer "right to remain" guarantees to protect low-income residents from displacement when developers launch new building projects and an area suddenly gentrifies. It was feared that residents in rent-controlled buildings might especially get pushed out. The new bill has several pieces of language to prevent this phenomenon, including a ban on tearing down certain types of occupied apartment buildings. It also requires developers building taller structures to include affordable housing units.
⇧ US job creation slows to 155,000 in November; unemployment 3.7%
At the current rate, unemployment is likely to continue to fall, reaching as little as three percent by the end of next year, he said.
"No one at the Fed thinks that's sustainable."
The Fed overreacting will depress wage gains, which will depress people coming out to look for jobs, which will overly slow the economy, which, when coupled with the negatives of the corporate-tax cuts, will lead to recession.
⇧ Bad idea: "Landmark environmental protections being rolled back"
Environmental groups say more than a half-century of federal preservation of even remote, unloved and at times bone-dry creeks and wetlands has helped protect major downstream lakes and rivers from upstream pollutants, fertilizer runoffs and oil spills, helped clean up big water bodies including the Chesapeake Bay, and helped buffer humans against droughts, floods and hurricanes.
Money is more important? The road to environmental death is paved with money. There won't be enough money in the world to pay the premiums to insure against the loss of the global environment. Money is a blindfold on anti-environmentalists.
I wonder how much time President Trump has spent in nature, what's left of it anyway. Maybe he didn't like it.
Has he ever roughed it? Roughing it is good for the soul. He should try spending a few rustic weekends once in a while just walking in nature. It's not a guarantee, but it wouldn't hurt.
⇧ SF sues wealthy investors, alleges affordable-home scam
"The city's affordable housing program is not an investment scheme to be manipulated by would-be real estate moguls looking to profit off the housing crisis," said Herrera in a public statement.
⇧ Luxembourg to become first country to nix public transit fare
An idea like this would make owning rentals near public transit all the more profitable.
⇧ So Far, the Corporate Tax Changes Have Been a Bust
... the tax changes were a pointless transfer that simply gave companies more earnings to retain rather than spend.
⇧ Americans Will Pay Billions More For Climate Change, and That's the Best Case
... a best case-scenario will still leave Americans in a country where they are paying tens of billions of dollar[s] more annually to address the fallout of accelerating climate change. A scenario with dramatically less pollution could slash projected losses in 2090 by 48 percent ($75 billion) a year in labor costs, 58 percent ($80 billion) in heat-related deaths and 22 percent ($25 billion) in coastal real estate, according to the report.
⇧ Greige: Our Guide to the Color That's Taking Over Home Design
⇧ Investors managing $32 trillion in assets call for action on climate change
Among specific policy requests, the group called for governments to phase out thermal coal, put a "meaningful" price on carbon emissions and gradually get rid of subsidies for fossil fuels.
⇧ An Historic Opportunity To Transform Trade When We Stop NAFTA II
I opposed NAFTA because adequate labor and environmental standards were totally missing. I oppose what President Trump is proposing as a replacement for NAFTA for those same reasons and more.
This linked article may strike you as radical, but it's actually very practical. If we continue down the path of NAFTA and Trump's proposed replacement, we'll completely ruin the environment and economy.
⇧ Landlord/Tenant Subrogation In All 50 States
This 50-state chart [actually, it's a 15 page PDF document] summarizes landlord tenant subrogation laws. Understanding when, where, and why subrogation actions by a landlord's insurer against a tenant are permitted or prohibited is critical to maximizing property subrogation recoveries.
The ability of a landlord's property insurer to subrogate against a tenant for property damage caused by the negligence of the tenant depends on which state the loss occurs in and the nature and language of the lease involved. There are generally three different approaches ....
⇧ Man Sentenced for New York Vacation Rental Home Scam
Authorities say he advertised the properties on internet rental websites. One of the rentals he offered was undergoing significant construction, while another was owned by a person who wasn't offering it for rent.
After receiving deposits from customers, Dean would cancel the reservations and refuse to refund the payments.
⇧ A Worldly Philosopher (or Two) at 100
... it was economics' aspirations to Science (which he capitalizes) that bothered him. A new vision was replacing the discipline's traditional commitment to the study of capitalism and it left him cold, along with economists' oft-proclaimed commitment to "objectivity." Social studies were different from natural sciences, he wrote; human behavior cannot be understood without the concept of volition.
Tastes change, he noted; so do values, norms, and rules. "If economics were in fact a science, we humans would be mere robots, no more capable of choosing what was to be our response to a price rise than is a particle of iron to the presence of a magnet." And as for objectivity, he wrote, "the social life of humankind is by its very nature political." What does it mean to be objective about inherited wealth or abject poverty?
⇧ Can anything hold back China's economy? [Yes]
I've disagreed with Larry Summers at times; but, on this subject of China, I couldn't disagree more.
Larry points out the dangers of anti-democratic China and then seems to turn around and say we should embrace it.
I say that we should gather the world to resist anti-democracy no matter what.
⇧ The Most Toxic Retailers on the Planet
Ten retailers — Lowe's, Sherwin-Williams, The Home Depot, Walmart, True Value, PPG Paints, AutoZone, Kelly-Moore Paints, Canadian Tire and Home Hardware — have all vowed to cease selling paint strippers containing methylene chloride and NMP by the end of 2018.
⇧ The Best Technology [technique] for Fighting Climate Change Isn't a Technology
... we are fighting a crisis of deforestation, much of it driven by conversion to agricultural lands to produce a handful of resource-intensive commodities, despite zero-deforestation commitments from companies and governments. With increasing atmospheric carbon dioxide, insufficient emissions reductions and continued high rates of deforestation, urgent action is needed to avoid the worst effects of climate change.
Now is the time to increase investment in and attention to forest protection and restoration.
⇧ It's worse than you think: "Climate policies put world on track for 3.3C warming: study"
... countries including the United States, Australia, Brazil, Indonesia, Russia and the United Arab Emirates have made either no progress or taken backward steps.
⇧ The Efficient Market Hypothesis Takes a Beating
There are reasons beyond the economic data that should give bulls hope, according to DataTrek Research. For one, the Federal Reserve is sounding less hawkish, suggesting it will not keep hiking interest rates blindly until some notion of "neutral" has been reached. Also, the big drop in Treasury yields over the last month should help support equity valuations. Plus, the dollar has stopped appreciating and has largely moved sideways in the past month, which should help exporters; 37 percent of S&P 500 revenues come from non-U.S. sources.
Well, yes. The Fed is the bull in the China shop. Has it already overtightened? I know that question runs completely contrary to public thinking, but the Fed is still only talking about slowing rate hikes, not stopping them right now.
They're spraying the roads in LA with this.
I haven't checked into competing products, but the concept is good.
NY paints roofs white for the same reason.
I remember cool decks worked really well in Phoenix.
⇧ Utilities to Cover Power Lines, Expand Weather Monitoring in High Risk Areas
Well, it's not the way I'd go about it, but it beats the status quo.
⇧ Democratic state senator blasts Amazon's HQ2 as a PR scam, saying 'New York fell for it'
I remember the saying, "What's good for GM is good for America." Was it really true? Is it true about Amazon no matter where Amazon has its various HQs? We'll have to see whether anyone really does a study on Long Island City and Amazon in a few years.
⇧ Aluminum tariffs have led to a strong recovery in employment, production, and investment in primary aluminum and downstream industries
As my readers know, I was pro-tariff right from the get go. Of course, I emphasize the anti-democratic nature of the Chinese Communist Party, the dictatorial nature of Xi, as my prime concern without deemphasizing the economic benefits to the US of the tariffs and without adding environmental damage here in the US and without increasing the impoverishment of the average Chinese citizen of China, not that poverty isn't still rampant in China. It is.
So, here's a left-leaning economic study on the results of the aluminum tariffs against China that points out that all the handwringing before the tariffs really kicked in were completely misplaced. Frankly, I considered the vast majority of that handwringing to be deliberate hype used by those who were benefiting by trade with China at the expense of the US and the world in general. They were, in my view, putting themselves above democratization of China.
I do realize that President Trump does not mention democracy as a litmus test for trade with China. I count that a grave error on his part.
When the tariffs on steel and aluminum imports were imposed, critics claimed that while they would save thousands of jobs in primary metals industries, hundreds of thousands of jobs would be eliminated in the rest of the economy. These critics referenced a 2018 study by the Trade Partnership.3 I said at the time that the Trade Partnership forecast was wildly exaggerated and that the impacts of the tariffs would be quite minor.4 This report demonstrates that, to date, there is no evidence of the negative downstream effects claimed in the Trade Partnership study to be found anywhere in the U.S. economy. In total, the U.S. manufacturing sector has added approximately 176,000 jobs (including 2,700 in iron and steel production) since February 2018, the month before the tariffs took effect.5 In the rest of the economy, approximately 1.4 million jobs have been created in this same period. Looking more specifically at the industries aluminum producers supply, there remains no evidence that the imposition of tariffs on aluminum (or steel) have had the kinds of negative employment impacts—in downstream manufacturing or other parts of the economy—that were predicted by critics of aluminum tariffs.
... There is absolutely no evidence that the imposition of tariffs in the aluminum (or steel) industries have had the kinds of negative employment impacts—in downstream manufacturing or other parts of the economy—that were predicted by critics of the aluminum tariffs.
This report has demonstrated that, to date, the aluminum tariffs have had their intended effect: The domestic producers of both primary aluminum and downstream aluminum products have made commitments to create thousands of jobs, invest billions of dollars in aluminum production, and substantially increase domestic production since Section 232 tariffs were imposed on March 8, 2018.
⇧ Sweden's forests have doubled in size over the last 100 years
... how has Sweden managed to grow its timber industry as well as its level of tree cover?
The simple answer is that Sweden grows more trees than it chops down.
According to the Swedish Society for Nature Conservation, Sweden's model means that ancient or old growth forests are disappearing, replaced by clear-cutting, where all trees in an area are felled, to be replaced with monoculture tree plantations, where all the trees are of the same species.
So, Sweden has been smart but must become even smarter.
⇧ Europe must fight illiberal forces, Draghi warns
Large institutional reforms have essentially stalled in recent years, mostly due to resistance from Germany, which fears that its taxpayers could be asked to foot the bill for the fiscal irresponsibility and excesses of weaker euro members.
That's not even half the story. Draghi is much more correct than those to his German "ordoliberal" right, but Germany has unfairly benefited by the EU and euro since inception. Germany benefits vis-a-vis states such as Greece because Germany is much larger, has more resources, and Greece can't devalue the euro relative to Germany so Greece might become better able to export its own goods and services in competition with Germany. All economists worth their salt know this, as do all politicians worth theirs.
⇧ Our Plastic Addiction Has Reached A New Crisis Level
... what if a vanishing plastic product looked, felt and acted like a regular plastic product? What if it could also guarantee that it would truly biodegrade in any context, whether the product went to a landfill or escaped into the ocean?
At the London laboratory of British-based technology company Polymateria, researchers are working on this holy grail, a plastic that guarantees total biodegradation and a complete return to the biological cycle. They claim to be getting close.
Basically, Polymateria is working to alter plastic at a molecular level. The technology lies dormant when the product ? let's say it's a plastic cup ? is on a store shelf or in use by a consumer. The cup can even be recycled like normal. But if the cup escapes, becomes fugitive plastic, biodegradation is triggered. At this point, the technology opens up the polymer chain so the natural agents of decay ? ultraviolet light, moisture, air and microbes ? can set to work. Or if the plastic ends up in a recycling bin, that's fine too. Polymateria calls this "seat belt technology," reflecting the fact that every eventuality would be covered.
Polymateria's main hurdle will be to win trust. If it does persuade manufacturers to use its technology, then consumers could soon be handling products ? from hot drinks to chip bags to fruit netting ? that promise total biodegradability.
⇧ The truth is harsh to those who hate it: "The Great American Tax Heist Turns One"
Scholarship is about the pursuit of truth. When scholars find that they have gotten something wrong, they ask themselves why, in order to improve their methodology and possibly get it less wrong in the future. The economists who predicted that tax cuts would spur a rapid increase in investment and sustained growth have now been proven wrong. If they were serious academics committed to their discipline, they would take this as a sign that they have something to learn. Sadly, they have not. They have remained silent, which suggests that they are not surprised to see investment fall far short of what they promised.
Everybody I trusted at the time agreed with me that the cuts would result in stock buybacks and not in much growth and certainly not in many jobs or higher wages. We were right and are not at all surprised. We all also knew and said that the reason for the cuts was to increase the deficit as an excuse to slash benefits and as an excuse to further privatize. Slashing benefits and increasing privatization will only further harm the economy. The greedy don't care. They just want more for themselves and to hell with others.
⇧ Invisible pollutants and the tipping point for endocrine disruption
How does the following impact your real estate investing?
What we now know, through rich and varied research from all over the world, is that among the hidden factors are environmental exposures to chemicals that have leached into our soil, farms, and food supply; cosmetics, hygiene products, and household furniture; and our outdoor spaces such as gardens, lawns, fields, and recreational parks.
The evidence linking cause and effect is strongest for four major categories of chemicals, but we know of at least a thousand more chemicals that are endocrine disruptors. And this is an underestimate; many chemicals have not been tested and so fly under the radar of both scientists and the medical community.
⇧ More Than 100 Buildings Found Unsafe After Alaska Quake
Factors affecting the level of damage during the earthquake include the type of construction used for a building, the geologic material it was built on and the way the shaking energy was focused or concentrated, Salisbury said.
⇧ Authorities: At Least $3B to Clear Debris from Homes Destroyed By California Wildfires
Keep the following in mind next time someone says government is inherently bad and that the private sector is always better.
California Office of Emergency Services Director Mark Ghilarducci said the state will manage cleanup contracts this time. Hundreds of Northern California homeowners complained contractors last year paid by the ton hauled away too much dirt and damaged unbroken driveways, sidewalks and pipes. The state OES spent millions of dollars repairing that damage.
⇧ Climate talks pass baton in race to stop global warming
President Trump is dead wrong about greenhouse gases. He is scientifically illiterate on the subject.
The United States, set to withdraw from the U.N. process at the behest of President Donald Trump, staged an event touting the benefits of burning fossil fuels, including coal, more efficiently, while back at home, Trump has termed the Paris deal "ridiculous".
A scientific report requested by the Paris signatories said the share of coal-fueled power would have to be cut to under 2 percent by 2050, along with big cuts to other fossil fuels, to stop temperatures rising more than 1.5C and causing devastating floods, storms, heat waves and drought.
Burning coal "more efficiently" is not a viable solution right now. Scrubbing coal emissions is not 100%. There are more issues with coal than simply CO2 emissions. Mining is dangerous, and mountain-top removal is terrible for the environment as well. Sequestration of CO2 is currently extremely inadequate to allow continued coal burning at nearly any level.
What's ridiculous is AGW denial. It's worse than ridiculous coming from a US President. It's downright genocidally negligent at best.
"Floods, storms, heat waves, and droughts" leaves out fires, ocean rising permanent land loss, earthquakes and groundwater pollution from fracking, AGW refugees, ocean acidification, species loss, potential runaway warming due to permafrost thawing and methane releases, and more, much more.
President Trump's approach is going to cost you more in insurance premiums if you'll be able to get coverage for your investment properties at all.
Even if we continually sequester enough CO2 to take us back to a pre-AGW climate, coal burning will remain a bad idea.
⇧ This Radical Plan to Fund the 'Green New Deal' Just Might Work
Again and again and again, we say:
Every hyperinflation in history has been caused by foreign debt service collapsing the exchange rate.
Therefore, don't borrow. Match the supply and velocity of money to real productivity and demand. That means removing private commercial banking as the primary source of US money. That means replacing the Fed with the US Treasury. That means replacing the Fed's board with the US legislature. That means replacing plutocracy with democracy if we hold the legislators to account. Doing that would require a vastly more direct-democracy system replacing the extremely limited-representative form we have now. It would mean instant recall of representatives for not doing the will of the electorate.
⇧ Paradigm shifts: The Great crash of 2008 revisited
... approach was taken up by the Roosevelt administration when it came to office in 1933. At that time unemployment in the US stood at the alarming figure of 25%. A raft of policy measures Works Programme Administration (WPA), National Recovery Act (NRA), Tennessee Valley Authority (TVA) Civilian Conservation Corps, were implemented. Unemployment fell to 14% by 1936, but then rose again during a new recession in 1937/38 to 20%. So, the track record of Keynes policies seems patchy to say the least.
That completely misses the history, which is that fiscal spending was deliberately contracted at the insistence of the deficit hawks at the time. When unemployment began rising again, Roosevelt reversed course by going back to increased fiscal spending. The recovery resumed. Keynes' policies were not at all patchy but spot on.
... there are high levels of unemployment on both sides of the pond. Official figures for US unemployment, as found in the Bureau of Labour Statistics, are completely fraudulent since whole swathes of de facto unemployed have been disappeared off the register simply by definition. The same disappearing trick was used with the core inflation figures. The Bureau of Labour Statistics uses U3 but the figure for U6 is double. And if the same definition was applied as used to be the case then unemployment would be almost 4 times the official account. The same statistical ledger main is used when defining inflation. Each redefinition gives a lower figure.
This manipulation of statistics is the same for inflation, GDP growth and various other economic data. These are not measurements of objective facts, but simply political constructions. (See John Williams Shadow Government Statistics).
John Williams is someone I've read at length. He predicted runaway inflation due to fiscal spending. Obviously, he was completely wrong. I too predicted inflation, but I made the mistake of thinking government would jump on Keynesian stimulus about 20-fold what it did. 10-fold would have been just about right. As for the current unemployment rates used by the BLS, the one and only issue that matters is labor slack. The question concerns how many people would come out of unemployment were more jobs available and higher wages. The BLS is not misrepresenting unemployment, but policy makers, such as at the Fed, have been underestimating slack ever since the 2008 crash.
The poster child for the Keynesians was United States which has thrown everything but the kitchen sink at the problem in both fiscal and monetary terms. This has produced some low growth — mostly stock buy-backs, which is not growth but asset-price inflation — stimulated by the Fed's free money policy of historically low interest rates and QE. The fall in unemployment was massively overstated (sometimes genuine but more often by massive massaged by the usual statistical and definitional jiggery-pokery) but each additional stimulus has had less of an impact than the one preceding it. A sort of diminishing returns has set in, whereby more and more of the 'fix' is needed to get any sort of result.
That's a complete misunderstanding of Keynes. Keynes was not a monetarist. Keynes advocated fiscal spending. Keynes would have spent a great deal more and in shorter order than happened in the US. What little fiscal stimulus there was is exactly why the US didn't fall into a worse depression than the 1930s. The stock buybacks weren't due to Keynesianism but corporate-tax cuts, cuts exactly at the wrong time in terms of anti-cyclical Keynesianism.
... where did the Fed get its money from? Out of thin air apparently, it simply printed the stuff! When the stage is reached where governments have to pay their current expenditures by printing money then the alarm bells should start ringing. ...
That's completely wrong. The one and only concern is price inflation. We haven't had much of it at all. Price inflation is exactly what lowers unemployment. The balance is the issue, not how the money is created.
Over the next 20 years, the Social Security Trust Fund won't have enough funds to cover the retirement benefits promised to Baby Boomers. That means higher taxes, since the high U.S. debt rules out further loans from other countries. Unfortunately, it's most likely that these benefits will be curtailed, either to retirees younger than 70, or to those who are high income and therefore aren't as dependent on Social Security payments to fund their retirement.
That's not true. The government can simply create the funds to pay the benefits. It can do that without borrowing a dime, something the author appears to ignore. Again, the only issue is price inflation.
... a system which cannot go on in its present form for the simple reason that it needs to grow at a compound rate of 3% forever — infinite growth in a finite world, which is, however, not possible. ...
That's a fallacy on several fronts. First, the economy doesn't have to grow at that rate to survive. There are many variables that can reduce costs and do. Second, the world isn't finite in the sense meant there. Our economy will definitely include what we call outer space. In fact, it already does.
... On the real left even public spending on work creation programmes, investment in green technology, a national investment bank — will only provide a temporary fix, and may well have negative downsides, such as inflation.
If productivity, demand, and free-money supply match, there won't be any issue.