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2116 [lbo-talk] Goodbye to the export of surplus capital? -- rank: 1000

On Feb 7, 2011, at 2:03 PM, SA wrote: > On 2/7/2011 1:49 PM, Doug Henwood wrote: > >> This stuff is circular and feeds on itself, so it's hard to identify a first cause. But financial assets were relatively minimal in the 1950s. And nonfin corps were transferring about 20% of internal funds to shareholders. Since 2000, it's more than three times that. >> >> Why was there pressure for dereg and innovation? > > Good question. See, this is why we need historians! I fee ...

Document Size:	5715
Author:	Doug Henwood
Date:	Mon Feb 7 11:18:36 PST 2011

2117 [lbo-talk] Goodbye to the export of surplus capital? -- rank: 1000

On Feb 7, 2011, at 1:26 PM, SA wrote: > So institutional investors want higher returns only when they have "too much money"? And bankers want to pump profitable garbage into the system only when the system has "too much money"? I thought these people were maximizers, not satisficers! Why didn't this stuff always go on? > > In the 50's interest rates were incredibly low across the spectrum. Thus, the banks were "awash with money." But that didn't lead to any ...

Document Size:	5785
Author:	Doug Henwood
Date:	Mon Feb 7 10:49:18 PST 2011

2118 [lbo-talk] Goodbye to the export of surplus capital? -- rank: 1000

On Feb 7, 2011, at 12:42 PM, Ted Winslow wrote: > Aggregate income in a period is identically equal to aggregate expenditure in the same period. To have some part of aggregate "saving" in a period accumulate as cash is to have aggregate income exceed aggregate expenditure by the amount of the accumulated cash. How is this possible? It explains the rise in consumption (mass and elite). And negative net exports. Doug

Document Size:	5118
Author:	Doug Henwood
Date:	Mon Feb 7 09:56:03 PST 2011

2119 [lbo-talk] Goodbye to the export of surplus capital? -- rank: 1000

On Feb 7, 2011, at 12:37 PM, brad wrote: > The > correlation of the two series suggests that the dramatic run-up in > household debt relative to income was largely driven by an increase in > the supply of credit over time. Exactly. And it also explains the long decline in the savings rate that the SF Fed paper modeled. Doug

Document Size:	5051
Author:	Doug Henwood
Date:	Mon Feb 7 09:55:00 PST 2011

2120 [lbo-talk] Goodbye to the export of surplus capital? -- rank: 1000

On Feb 7, 2011, at 12:22 PM, SA wrote: > On 2/7/2011 11:31 AM, Doug Henwood wrote: > >>> It was the hysterical forecast of price appreciation, not the "hiding" of risk >> Not exactly. Goldman and the rest packaged dud securities and sold them to clients at the same time they were shorting the crap. They even shorted Bear Stearns' stock after Bear bought one of those turkeys. Also, in a bubble, people often can't see what should be obvious - that the forecasts were ...

Document Size:	7942
Author:	Doug Henwood
Date:	Mon Feb 7 09:41:36 PST 2011

2121 [lbo-talk] The Donald for Pres? -- rank: 1000

[from The Note] Rep. Heath Schuler, D-N.C. is one of the 20 Blue Dog Democats who plan to meet with businessman Donald Trump today in New York City. The meeting with Trump, who has expressed interest in running for president in 2012, is set to last an hour. Sources say they will talk about the economy and ideas Trump has for improving it.

Document Size:	4843
Author:	Doug Henwood
Date:	Mon Feb 7 08:35:20 PST 2011

2122 [lbo-talk] Goodbye to the export of surplus capital? -- rank: 1000

On Feb 7, 2011, at 11:03 AM, SA wrote: > By the way, this note from the SF Fed presents a simple regression to explain the decline in the household saving rate since the early 80's. The two explanatory variables are household net worth and a measure of consumer credit availability (from a Fed loan officer survey). The two variables explain 90% of the variance. Yes, that's a nice model, and I recently repurposed it myself. But what explains the increased willingness to lend? A surplus of cash ...

Document Size:	5196
Author:	Doug Henwood
Date:	Mon Feb 7 08:32:51 PST 2011

2123 [lbo-talk] Goodbye to the export of surplus capital? -- rank: 1000

On Feb 7, 2011, at 8:15 AM, SA wrote: > It was the hysterical forecast of price appreciation, not the "hiding" of risk Not exactly. Goldman and the rest packaged dud securities and sold them to clients at the same time they were shorting the crap. They even shorted Bear Stearns' stock after Bear bought one of those turkeys. Also, in a bubble, people often can't see what should be obvious - that the forecasts were insane. Something like a negative amortization loan with low introduct ...

Document Size:	5865
Author:	Doug Henwood
Date:	Mon Feb 7 08:31:58 PST 2011

2124 [lbo-talk] Goodbye to the export of surplus capital? -- rank: 1000

On Feb 7, 2011, at 7:38 AM, SA wrote: > Keynes would say that if corporations decide autonomously to invest less, the result will be a recession - unless there happens to be an autonomous increase in consumption at the same time. Obviously, the latter is what actually happened. Now, you're right, wages didn't cover the increase in consumption - a lot of it came from borrowing. But that's where the causal slippage happens: just because investors receiving payouts now have more cash to put &quo ...

Document Size:	8383
Author:	Doug Henwood
Date:	Mon Feb 7 08:25:16 PST 2011

2125 [lbo-talk] Definition of nation (was as if on cue) -- rank: 1000

On Feb 7, 2011, at 10:37 AM, Wendy Lyon wrote: > But, you know, the streets of London are as > cosmopolitan and multilingual as anywhere else in the EU - despite > their supposed insularity (and the fact they are not part of > Schengen). Yes, but that's not where the opposition to the EU comes from, is it? I thought it was more rural Tories. Doug

Document Size:	5068
Author:	Doug Henwood
Date:	Mon Feb 7 08:05:55 PST 2011

2126 [lbo-talk] Goodbye to the export of surplus capital? -- rank: 1000

On Feb 6, 2011, at 9:53 PM, SA wrote: > Yes, but the part I don't buy is the connection between bigger payouts and speculative fever. I can't see any causal link. The notion that a dividend payout (or buyback or whatever) represents money going "from" the real sector "to" the financial is true at a micro level, but I think this argument confuses the micro with the macro. At a macro level, lower investment/GDP means higher consumption/GDP (or govt, or exports), not larger f ...

Document Size:	6583
Author:	Doug Henwood
Date:	Sun Feb 6 19:41:28 PST 2011

2127 [lbo-talk] How Much Do College Students Learn, and Study? -- rank: 1000

On Feb 6, 2011, at 8:31 PM, Michael Smith wrote: > I personally had the schooling, and I'm still poor, isolated, > and confused. Life in Manhattan can do that to you, eh?

Document Size:	4922
Author:	Doug Henwood
Date:	Sun Feb 6 17:55:40 PST 2011

2128 [lbo-talk] Goodbye to the export of surplus capital? -- rank: 1000

On Feb 6, 2011, at 11:57 AM, SA wrote: > If there are fewer real investment opportunities, the result will be less real investment. It won't be more financial speculation. U.S. corps have accumulated vast amounts of cash over the last couple of decades, much of which they've passed along to shareholders through dividends, buybacks, and takeovers. So a lot of money has passed from the "real" sector to the financial. Part of the reason for this is that shareholders have demanded very ...

Document Size:	6001
Author:	Doug Henwood
Date:	Sun Feb 6 17:55:01 PST 2011

2129 [lbo-talk] How Much Do College Students Learn, and Study? -- rank: 1000

On Feb 6, 2011, at 5:33 PM, Dennis Claxton wrote: >> If it weren't for the schooling, where would you be? Probably poor, isolated, and confused. >> >> Doug > > > Maybe you should have counted to ten before pulling the trigger on that one. I don't see why. I'm tired of listening to all these highly educated people dismiss the value of good education. Doug

Document Size:	5180
Author:	Doug Henwood
Date:	Sun Feb 6 14:46:31 PST 2011

2130 [lbo-talk] How Much Do College Students Learn, and Study? -- rank: 1000

On Feb 6, 2011, at 2:57 PM, shag carpet bomb wrote: > so, are you answering my question or avoiding it? You had a question? > Is your strategy to improve schooling because this is a radical demand. It's not a strategy, but yes, it should be a demand. As I recall, "free education for all children" was one of the ten demands in the Communist Manifesto. > perhaps i didn't make myself clear: i don't think capital *wishes* anything. i think such vulgar functionalist metaphors and a ...

Document Size:	7041
Author:	Doug Henwood
Date:	Sun Feb 6 13:38:52 PST 2011