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An Excellent Debate

progressivedem22
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6/20/2014 10:17:54 AM
Posted: 2 years ago
I'm not the biggest fan of Peter Schiff, but I think this was an excellent discussion that I highly advise you all to watch if you happen to have an hour and a half to spare.

In fact, I may actually post an RFD for this debate, or for some of the Intelligence Squared debates, which are also excellent.
wrichcirw
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6/23/2014 10:36:37 AM
Posted: 2 years ago
I haven't spent the hour and a half to watch this particular debate, but I have read a lot of stuff from Schiff and think his views are generally pretty spot-on. The problem is that he doesn't have a viable plan as to what to do to replace or correct what he sees as wrong-doing, and his own investment ventures have been generally lackluster. It could be that time will prove him right eventually, but in the meantime, people have been losing money acting upon his advice for several years now.

It's much easier to criticize an existing plan or system than it is to actually create a system that is resistant to criticism.
At 8/9/2013 9:41:24 AM, wrichcirw wrote:
If you are civil with me, I will be civil to you. If you decide to bring unreasonable animosity to bear in a reasonable discussion, then what would you expect other than to get flustered?
twocupcakes
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6/23/2014 7:18:27 PM
Posted: 2 years ago
At 6/23/2014 10:36:37 AM, wrichcirw wrote:
I haven't spent the hour and a half to watch this particular debate, but I have read a lot of stuff from Schiff and think his views are generally pretty spot-on. The problem is that he doesn't have a viable plan as to what to do to replace or correct what he sees as wrong-doing, and his own investment ventures have been generally lackluster. It could be that time will prove him right eventually, but in the meantime, people have been losing money acting upon his advice for several years now.

It's much easier to criticize an existing plan or system than it is to actually create a system that is resistant to criticism.

I did not watch the video either but I always got the vibe that Schiff was kinda a nut-job? Like saying the dollar would collapse and we should hoard gold and stuff...
wrichcirw
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6/24/2014 12:23:30 AM
Posted: 2 years ago
At 6/23/2014 7:18:27 PM, twocupcakes wrote:
At 6/23/2014 10:36:37 AM, wrichcirw wrote:
I haven't spent the hour and a half to watch this particular debate, but I have read a lot of stuff from Schiff and think his views are generally pretty spot-on. The problem is that he doesn't have a viable plan as to what to do to replace or correct what he sees as wrong-doing, and his own investment ventures have been generally lackluster. It could be that time will prove him right eventually, but in the meantime, people have been losing money acting upon his advice for several years now.

It's much easier to criticize an existing plan or system than it is to actually create a system that is resistant to criticism.

I did not watch the video either but I always got the vibe that Schiff was kinda a nut-job? Like saying the dollar would collapse and we should hoard gold and stuff...

Cassandras always sound like nut-jobs until what they say comes to pass.

Schiff has been correct on rather uncomfortable positions in the past, and his reasoning has been sound. His reasoning is sound on the dollar as well. Perhaps "collapse" is too strong a term, but pronounced inflation is predicated based upon current Fed policy. IMHO recent stock market success is a leading indicator of this eventual inflation; it is most certainly not a vote of confidence in the American economy.
At 8/9/2013 9:41:24 AM, wrichcirw wrote:
If you are civil with me, I will be civil to you. If you decide to bring unreasonable animosity to bear in a reasonable discussion, then what would you expect other than to get flustered?
JohnMaynardKeynes
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6/24/2014 12:54:43 AM
Posted: 2 years ago
At 6/24/2014 12:23:30 AM, wrichcirw wrote:
At 6/23/2014 7:18:27 PM, twocupcakes wrote:
At 6/23/2014 10:36:37 AM, wrichcirw wrote:
I haven't spent the hour and a half to watch this particular debate, but I have read a lot of stuff from Schiff and think his views are generally pretty spot-on. The problem is that he doesn't have a viable plan as to what to do to replace or correct what he sees as wrong-doing, and his own investment ventures have been generally lackluster. It could be that time will prove him right eventually, but in the meantime, people have been losing money acting upon his advice for several years now.

It's much easier to criticize an existing plan or system than it is to actually create a system that is resistant to criticism.

I did not watch the video either but I always got the vibe that Schiff was kinda a nut-job? Like saying the dollar would collapse and we should hoard gold and stuff...

Cassandras always sound like nut-jobs until what they say comes to pass.

Schiff has been correct on rather uncomfortable positions in the past, and his reasoning has been sound. His reasoning is sound on the dollar as well. Perhaps "collapse" is too strong a term, but pronounced inflation is predicated based upon current Fed policy. IMHO recent stock market success is a leading indicator of this eventual inflation; it is most certainly not a vote of confidence in the American economy.

I disagree with you quite a bit on Schiff, but I urge you to watch this video, as it puts things into perspective (sorry to hijack the thread):

htt://www.youtube.com...

It's not exactly the worst thing for Schiff's reputation -- especially given his cultish following who think all government numbers are ipso facto flawed -- but he didn't exactly perform too well in this interview. The dialogue between Peter and Scott Sumner, the latter of whom actually is an expert on these topics, bore much resemblance to that which would occur between a student and a professor, respectively. Of course, Sumner actually is a prof, so why Mr. Kudlow would think it wise to match Peter with someone who can talk circles around him is another thing. Even Kudlow couldn't get behind Schiff this time. Not to mention, Schiff tried to pull a semantics game by equating inflation with an increase in the monetary base. Anyone who has ever seen the money multiplier formula can tell you that what he's saying was a hunk of crap.
~JohnMaynardKeynes

"The sight of my succulent backside acts as a sedative for the beholder. It soothes the pain of life and makes all which hurts seem like bliss. I urge all those stressed by ridiculous drama on DDO which will never affect your real life to gaze upon my cheeks for they will make you have an excitement and joy you've never felt before." -- Dr. Dennybug

Founder of the BSH-YYW Fan Club
Founder of the Barkalotti
Stand with Dogs and Economics
JohnMaynardKeynes
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6/24/2014 1:24:06 AM
Posted: 2 years ago
And Sumner elaborated a bit: http://www.themoneyillusion.com...
~JohnMaynardKeynes

"The sight of my succulent backside acts as a sedative for the beholder. It soothes the pain of life and makes all which hurts seem like bliss. I urge all those stressed by ridiculous drama on DDO which will never affect your real life to gaze upon my cheeks for they will make you have an excitement and joy you've never felt before." -- Dr. Dennybug

Founder of the BSH-YYW Fan Club
Founder of the Barkalotti
Stand with Dogs and Economics
twocupcakes
Posts: 2,749
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6/24/2014 6:39:32 PM
Posted: 2 years ago
At 6/24/2014 12:23:30 AM, wrichcirw wrote:
At 6/23/2014 7:18:27 PM, twocupcakes wrote:
At 6/23/2014 10:36:37 AM, wrichcirw wrote:
I haven't spent the hour and a half to watch this particular debate, but I have read a lot of stuff from Schiff and think his views are generally pretty spot-on. The problem is that he doesn't have a viable plan as to what to do to replace or correct what he sees as wrong-doing, and his own investment ventures have been generally lackluster. It could be that time will prove him right eventually, but in the meantime, people have been losing money acting upon his advice for several years now.

It's much easier to criticize an existing plan or system than it is to actually create a system that is resistant to criticism.

I did not watch the video either but I always got the vibe that Schiff was kinda a nut-job? Like saying the dollar would collapse and we should hoard gold and stuff...

Cassandras always sound like nut-jobs until what they say comes to pass.

Schiff has been correct on rather uncomfortable positions in the past, and his reasoning has been sound. His reasoning is sound on the dollar as well. Perhaps "collapse" is too strong a term, but pronounced inflation is predicated based upon current Fed policy. IMHO recent stock market success is a leading indicator of this eventual inflation; it is most certainly not a vote of confidence in the American economy.

Really? I always thought Schiff was bananas. Mind you, I have never followed him to closely. But, I always thought he was just an empty suit who blabbers nonsense on tv.

I know in oct 2012 he predicted the price of Gold to go from 1700 to 5000 in 2 years.

http://www.cnbc.com...

...And the price of gold is about 1300 today.

And, in 2009 he said...

"You know, look, I know inflation is going to get worse in 2010. Whether it"s going to run out of control or it"s going to take until 2011 or 2012, but I know we"re going to have a major currency crisis coming soon. It"s going to dwarf the financial crisis and it"s going to send consumer prices absolutely ballistic, as well as interest rates and unemployment."


http://krugman.blogs.nytimes.com...

Inflation has been as low as ever.

He is absolutely wrong about inflation. And, in a recession, expansionary FED policy is not much of a worry. The upward sloping yeild curve shows that a collapse should not be a concern.
wrichcirw
Posts: 11,196
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6/24/2014 11:46:13 PM
Posted: 2 years ago
At 6/24/2014 12:54:43 AM, JohnMaynardKeynes wrote:
At 6/24/2014 12:23:30 AM, wrichcirw wrote:
At 6/23/2014 7:18:27 PM, twocupcakes wrote:
At 6/23/2014 10:36:37 AM, wrichcirw wrote:
I haven't spent the hour and a half to watch this particular debate, but I have read a lot of stuff from Schiff and think his views are generally pretty spot-on. The problem is that he doesn't have a viable plan as to what to do to replace or correct what he sees as wrong-doing, and his own investment ventures have been generally lackluster. It could be that time will prove him right eventually, but in the meantime, people have been losing money acting upon his advice for several years now.

It's much easier to criticize an existing plan or system than it is to actually create a system that is resistant to criticism.

I did not watch the video either but I always got the vibe that Schiff was kinda a nut-job? Like saying the dollar would collapse and we should hoard gold and stuff...

Cassandras always sound like nut-jobs until what they say comes to pass.

Schiff has been correct on rather uncomfortable positions in the past, and his reasoning has been sound. His reasoning is sound on the dollar as well. Perhaps "collapse" is too strong a term, but pronounced inflation is predicated based upon current Fed policy. IMHO recent stock market success is a leading indicator of this eventual inflation; it is most certainly not a vote of confidence in the American economy.

I disagree with you quite a bit on Schiff, but I urge you to watch this video, as it puts things into perspective (sorry to hijack the thread):

htt://www.youtube.com...

It's not exactly the worst thing for Schiff's reputation -- especially given his cultish following who think all government numbers are ipso facto flawed -- but he didn't exactly perform too well in this interview. The dialogue between Peter and Scott Sumner, the latter of whom actually is an expert on these topics, bore much resemblance to that which would occur between a student and a professor, respectively. Of course, Sumner actually is a prof, so why Mr. Kudlow would think it wise to match Peter with someone who can talk circles around him is another thing. Even Kudlow couldn't get behind Schiff this time. Not to mention, Schiff tried to pull a semantics game by equating inflation with an increase in the monetary base. Anyone who has ever seen the money multiplier formula can tell you that what he's saying was a hunk of crap.

Your first link didn't work, but I found the video in your second link.

1) We all know that regardless of the nominal rise in employment numbers, the labor force participation rate is shrinking, and the jobs added are not high quality jobs (http://www.latimes.com...). This does not point to any sort of recovery and supports Schiff's conclusion that we are still in a recession.

2) I agree with you that Schiff equating inflation to monetary easing is not correct, and that with a lower money multiplier, you can expand the monetary base without actual inflation. Still, my understanding of most inflation hawks' positions (not necessarily Schiff's here) is that expanding the monetary base is sowing the seeds for rampant inflation in the future. People like Buffett have been on record saying this almost verbatim back when QE was first being implemented (before it was even called QE):

"inflation could be a very -- is a likely consequence out of what's going on now. Right now, we are in effect making a -- to some extent, making a choice between future inflation and getting our -- getting off the floor. And we're likely -- we're likely to have more inflation in the future as a consequence of the things we do to fight the present situation."

http://www.cnbc.com...

I mean, he's just citing the basic consequences of Keynesian short-term policy on the long term.

3) Kudlow is a true hack. Anyone investing based on the advice or predilections of Kudlow or even worse Jim Cramer isn't really investing, IMHO.
At 8/9/2013 9:41:24 AM, wrichcirw wrote:
If you are civil with me, I will be civil to you. If you decide to bring unreasonable animosity to bear in a reasonable discussion, then what would you expect other than to get flustered?
wrichcirw
Posts: 11,196
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6/25/2014 12:01:16 AM
Posted: 2 years ago
At 6/24/2014 6:39:32 PM, twocupcakes wrote:
At 6/24/2014 12:23:30 AM, wrichcirw wrote:
At 6/23/2014 7:18:27 PM, twocupcakes wrote:
At 6/23/2014 10:36:37 AM, wrichcirw wrote:
I haven't spent the hour and a half to watch this particular debate, but I have read a lot of stuff from Schiff and think his views are generally pretty spot-on. The problem is that he doesn't have a viable plan as to what to do to replace or correct what he sees as wrong-doing, and his own investment ventures have been generally lackluster. It could be that time will prove him right eventually, but in the meantime, people have been losing money acting upon his advice for several years now.

It's much easier to criticize an existing plan or system than it is to actually create a system that is resistant to criticism.

I did not watch the video either but I always got the vibe that Schiff was kinda a nut-job? Like saying the dollar would collapse and we should hoard gold and stuff...

Cassandras always sound like nut-jobs until what they say comes to pass.

Schiff has been correct on rather uncomfortable positions in the past, and his reasoning has been sound. His reasoning is sound on the dollar as well. Perhaps "collapse" is too strong a term, but pronounced inflation is predicated based upon current Fed policy. IMHO recent stock market success is a leading indicator of this eventual inflation; it is most certainly not a vote of confidence in the American economy.


Really? I always thought Schiff was bananas. Mind you, I have never followed him to closely. But, I always thought he was just an empty suit who blabbers nonsense on tv.

I know in oct 2012 he predicted the price of Gold to go from 1700 to 5000 in 2 years.

http://www.cnbc.com...

...And the price of gold is about 1300 today.

Agree that Schiff's predictions tend to have a spotty track record, and anyone mirroring his portfolio is not going to have a comfortable retirement. That's not the argument I'm making in support of Schiff's position. I've already been candid that his investment advice is not the best.

And, in 2009 he said...

"You know, look, I know inflation is going to get worse in 2010. Whether it"s going to run out of control or it"s going to take until 2011 or 2012, but I know we"re going to have a major currency crisis coming soon. It"s going to dwarf the financial crisis and it"s going to send consumer prices absolutely ballistic, as well as interest rates and unemployment."


http://krugman.blogs.nytimes.com...


Inflation has been as low as ever.

Yeah, I think where Schiff goes wrong is when he tries to play Fed Chairman when he is not Fed Chairman.

He is absolutely wrong about inflation. And, in a recession, expansionary FED policy is not much of a worry. The upward sloping yeild curve shows that a collapse should not be a concern.

You need to realize that inflation of any sort (to include rampant inflation) occurs with an upward-sloping yield curve. A downward sloping yield curve is indicative of deflation (or at least disinflation), as it signals a strong demand for cash.

Anyway, see comment #8 for why I think Schiff's views are generally sound (if not precisely correct).
At 8/9/2013 9:41:24 AM, wrichcirw wrote:
If you are civil with me, I will be civil to you. If you decide to bring unreasonable animosity to bear in a reasonable discussion, then what would you expect other than to get flustered?
wrichcirw
Posts: 11,196
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6/25/2014 12:12:54 AM
Posted: 2 years ago
At 6/24/2014 1:24:06 AM, JohnMaynardKeynes wrote:
And Sumner elaborated a bit: http://www.themoneyillusion.com...

One last thing - Schiff's point on exporting inflation is not unique to him. IMHO these chickens all come home to roost eventually. Timing it (or at least thinking you can time it) is ever the Faustian bargain, and guys like Schiff have IMHO paid the price for their arrogance. That doesn't mean however that his general economic predictions are wrong.

http://online.wsj.com...
At 8/9/2013 9:41:24 AM, wrichcirw wrote:
If you are civil with me, I will be civil to you. If you decide to bring unreasonable animosity to bear in a reasonable discussion, then what would you expect other than to get flustered?
JohnMaynardKeynes
Posts: 1,512
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6/25/2014 12:13:20 AM
Posted: 2 years ago
At 6/24/2014 11:46:13 PM, wrichcirw wrote:
At 6/24/2014 12:54:43 AM, JohnMaynardKeynes wrote:
At 6/24/2014 12:23:30 AM, wrichcirw wrote:
At 6/23/2014 7:18:27 PM, twocupcakes wrote:
At 6/23/2014 10:36:37 AM, wrichcirw wrote:
I haven't spent the hour and a half to watch this particular debate, but I have read a lot of stuff from Schiff and think his views are generally pretty spot-on. The problem is that he doesn't have a viable plan as to what to do to replace or correct what he sees as wrong-doing, and his own investment ventures have been generally lackluster. It could be that time will prove him right eventually, but in the meantime, people have been losing money acting upon his advice for several years now.

It's much easier to criticize an existing plan or system than it is to actually create a system that is resistant to criticism.

I did not watch the video either but I always got the vibe that Schiff was kinda a nut-job? Like saying the dollar would collapse and we should hoard gold and stuff...

Cassandras always sound like nut-jobs until what they say comes to pass.

Schiff has been correct on rather uncomfortable positions in the past, and his reasoning has been sound. His reasoning is sound on the dollar as well. Perhaps "collapse" is too strong a term, but pronounced inflation is predicated based upon current Fed policy. IMHO recent stock market success is a leading indicator of this eventual inflation; it is most certainly not a vote of confidence in the American economy.

I disagree with you quite a bit on Schiff, but I urge you to watch this video, as it puts things into perspective (sorry to hijack the thread):

htt://www.youtube.com...

It's not exactly the worst thing for Schiff's reputation -- especially given his cultish following who think all government numbers are ipso facto flawed -- but he didn't exactly perform too well in this interview. The dialogue between Peter and Scott Sumner, the latter of whom actually is an expert on these topics, bore much resemblance to that which would occur between a student and a professor, respectively. Of course, Sumner actually is a prof, so why Mr. Kudlow would think it wise to match Peter with someone who can talk circles around him is another thing. Even Kudlow couldn't get behind Schiff this time. Not to mention, Schiff tried to pull a semantics game by equating inflation with an increase in the monetary base. Anyone who has ever seen the money multiplier formula can tell you that what he's saying was a hunk of crap.

Your first link didn't work, but I found the video in your second link.

1) We all know that regardless of the nominal rise in employment numbers, the labor force participation rate is shrinking, and the jobs added are not high quality jobs (http://www.latimes.com...). This does not point to any sort of recovery and supports Schiff's conclusion that we are still in a recession.


It depends on how you define a recession, but Sumner is correct that we've been adding about 2 million jobs a year and do have some semblance of a recovery. A recession, as the NBER defines it, is two consecutive quarters of G.D.P. contraction.

Now, we completely agree on slack in the labor market. Heck, EPI agrees with you. Krugman calls it a "depression." You don't need to convince me that the economy still sucks. We're in complete agreement.

My problem with Schiff is that he, in order to attempt to prove a no-brainer like "the economy still sucks," is to literally deny reality and act as though government numbers are ipso facto fallacious. He actually did the same thing with productivity. Obviously productivity since 1968 has more than doubled. But Schiff has said, because we're running a (shrinking) trade deficit, the productivity numbers cannot possibly be right. Denying employment and inflation numbers is far different from arguing that the economy is still bad. Even Sumner hasn't denied that. In fact, that's why he wants NGDP targeting: because he thinks we're not growing quickly enough.

2) I agree with you that Schiff equating inflation to monetary easing is not correct, and that with a lower money multiplier, you can expand the monetary base without actual inflation. Still, my understanding of most inflation hawks' positions (not necessarily Schiff's here) is that expanding the monetary base is sowing the seeds for rampant inflation in the future. People like Buffett have been on record saying this almost verbatim back when QE was first being implemented (before it was even called QE):

That is quite true. They tend to argue that an accumulation of excess reserves -- now at about $2.5 trillion, more than the typical 2 billion or less -- is future inflation. I obviously don't quite buy that argument, but it's at least mildly reasonable. It's good that you acknowledge that Schiff's position on this is off-base.

"inflation could be a very -- is a likely consequence out of what's going on now. Right now, we are in effect making a -- to some extent, making a choice between future inflation and getting our -- getting off the floor. And we're likely -- we're likely to have more inflation in the future as a consequence of the things we do to fight the present situation."


http://www.cnbc.com...

I mean, he's just citing the basic consequences of Keynesian short-term policy on the long term.


Obviously I disagree both on how much inflation we're going to have and how much inflation we could actually tolerate, but that's a topic for another day. This was really intended to discuss Peter Schiff, and it seems we agree on everything that's relevant.

And I don't see that as the long-term effect of Keynesian policies, as all Keynesians -- who aren't MMT'ers, by the way; I think those guys are nuts -- will tell you that, during boom years, interest rates need to go up and spending needs to get cut. None of us want out-of-control inflation.

3) Kudlow is a true hack. Anyone investing based on the advice or predilections of Kudlow or even worse Jim Cramer isn't really investing, IMHO.

I don't know much about him, but from what I've heard, that seems spot-on.
~JohnMaynardKeynes

"The sight of my succulent backside acts as a sedative for the beholder. It soothes the pain of life and makes all which hurts seem like bliss. I urge all those stressed by ridiculous drama on DDO which will never affect your real life to gaze upon my cheeks for they will make you have an excitement and joy you've never felt before." -- Dr. Dennybug

Founder of the BSH-YYW Fan Club
Founder of the Barkalotti
Stand with Dogs and Economics
wrichcirw
Posts: 11,196
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6/25/2014 12:24:36 AM
Posted: 2 years ago
At 6/25/2014 12:13:20 AM, JohnMaynardKeynes wrote:
At 6/24/2014 11:46:13 PM, wrichcirw wrote:
At 6/24/2014 12:54:43 AM, JohnMaynardKeynes wrote:
At 6/24/2014 12:23:30 AM, wrichcirw wrote:
At 6/23/2014 7:18:27 PM, twocupcakes wrote:
At 6/23/2014 10:36:37 AM, wrichcirw wrote:
I haven't spent the hour and a half to watch this particular debate, but I have read a lot of stuff from Schiff and think his views are generally pretty spot-on. The problem is that he doesn't have a viable plan as to what to do to replace or correct what he sees as wrong-doing, and his own investment ventures have been generally lackluster. It could be that time will prove him right eventually, but in the meantime, people have been losing money acting upon his advice for several years now.

It's much easier to criticize an existing plan or system than it is to actually create a system that is resistant to criticism.

I did not watch the video either but I always got the vibe that Schiff was kinda a nut-job? Like saying the dollar would collapse and we should hoard gold and stuff...

Cassandras always sound like nut-jobs until what they say comes to pass.

Schiff has been correct on rather uncomfortable positions in the past, and his reasoning has been sound. His reasoning is sound on the dollar as well. Perhaps "collapse" is too strong a term, but pronounced inflation is predicated based upon current Fed policy. IMHO recent stock market success is a leading indicator of this eventual inflation; it is most certainly not a vote of confidence in the American economy.

I disagree with you quite a bit on Schiff, but I urge you to watch this video, as it puts things into perspective (sorry to hijack the thread):

htt://www.youtube.com...

It's not exactly the worst thing for Schiff's reputation -- especially given his cultish following who think all government numbers are ipso facto flawed -- but he didn't exactly perform too well in this interview. The dialogue between Peter and Scott Sumner, the latter of whom actually is an expert on these topics, bore much resemblance to that which would occur between a student and a professor, respectively. Of course, Sumner actually is a prof, so why Mr. Kudlow would think it wise to match Peter with someone who can talk circles around him is another thing. Even Kudlow couldn't get behind Schiff this time. Not to mention, Schiff tried to pull a semantics game by equating inflation with an increase in the monetary base. Anyone who has ever seen the money multiplier formula can tell you that what he's saying was a hunk of crap.

Your first link didn't work, but I found the video in your second link.

1) We all know that regardless of the nominal rise in employment numbers, the labor force participation rate is shrinking, and the jobs added are not high quality jobs (http://www.latimes.com...). This does not point to any sort of recovery and supports Schiff's conclusion that we are still in a recession.


It depends on how you define a recession, but Sumner is correct that we've been adding about 2 million jobs a year and do have some semblance of a recovery. A recession, as the NBER defines it, is two consecutive quarters of G.D.P. contraction.

Ok, fair enough, whatever Schiff was using as a definition of "recession" is off, agree, and that was probably inaccurate for me to use as well.

Now, we completely agree on slack in the labor market. Heck, EPI agrees with you. Krugman calls it a "depression." You don't need to convince me that the economy still sucks. We're in complete agreement.

My problem with Schiff is that he, in order to attempt to prove a no-brainer like "the economy still sucks," is to literally deny reality and act as though government numbers are ipso facto fallacious. He actually did the same thing with productivity. Obviously productivity since 1968 has more than doubled. But Schiff has said, because we're running a (shrinking) trade deficit, the productivity numbers cannot possibly be right. Denying employment and inflation numbers is far different from arguing that the economy is still bad. Even Sumner hasn't denied that. In fact, that's why he wants NGDP targeting: because he thinks we're not growing quickly enough.

2) I agree with you that Schiff equating inflation to monetary easing is not correct, and that with a lower money multiplier, you can expand the monetary base without actual inflation. Still, my understanding of most inflation hawks' positions (not necessarily Schiff's here) is that expanding the monetary base is sowing the seeds for rampant inflation in the future. People like Buffett have been on record saying this almost verbatim back when QE was first being implemented (before it was even called QE):

That is quite true. They tend to argue that an accumulation of excess reserves -- now at about $2.5 trillion, more than the typical 2 billion or less -- is future inflation. I obviously don't quite buy that argument, but it's at least mildly reasonable. It's good that you acknowledge that Schiff's position on this is off-base.

"inflation could be a very -- is a likely consequence out of what's going on now. Right now, we are in effect making a -- to some extent, making a choice between future inflation and getting our -- getting off the floor. And we're likely -- we're likely to have more inflation in the future as a consequence of the things we do to fight the present situation."



http://www.cnbc.com...

I mean, he's just citing the basic consequences of Keynesian short-term policy on the long term.


Obviously I disagree both on how much inflation we're going to have and how much inflation we could actually tolerate, but that's a topic for another day. This was really intended to discuss Peter Schiff, and it seems we agree on everything that's relevant.

And I don't see that as the long-term effect of Keynesian policies, as all Keynesians -- who aren't MMT'ers, by the way; I think those guys are nuts -- will tell you that, during boom years, interest rates need to go up and spending needs to get cut. None of us want out-of-control inflation.

The question is whether or not the Fed in the past 20-30 years has had an actual track record of raising rates during boom times. Generally speaking, it has not. You have people like Alan Greenspan as Fed Chairman who was before and has subsequently been extremely bullish on gold.

3) Kudlow is a true hack. Anyone investing based on the advice or predilections of Kudlow or even worse Jim Cramer isn't really investing, IMHO.

I don't know much about him, but from what I've heard, that seems spot-on.

http://www.globaldashboard.org...

Predicted an economic recovery in 2007, for starters.
At 8/9/2013 9:41:24 AM, wrichcirw wrote:
If you are civil with me, I will be civil to you. If you decide to bring unreasonable animosity to bear in a reasonable discussion, then what would you expect other than to get flustered?
twocupcakes
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6/25/2014 7:41:22 PM
Posted: 2 years ago
At 6/25/2014 12:01:16 AM, wrichcirw wrote:
At 6/24/2014 6:39:32 PM, twocupcakes wrote:
At 6/24/2014 12:23:30 AM, wrichcirw wrote:
At 6/23/2014 7:18:27 PM, twocupcakes wrote:
At 6/23/2014 10:36:37 AM, wrichcirw wrote:
I haven't spent the hour and a half to watch this particular debate, but I have read a lot of stuff from Schiff and think his views are generally pretty spot-on. The problem is that he doesn't have a viable plan as to what to do to replace or correct what he sees as wrong-doing, and his own investment ventures have been generally lackluster. It could be that time will prove him right eventually, but in the meantime, people have been losing money acting upon his advice for several years now.

It's much easier to criticize an existing plan or system than it is to actually create a system that is resistant to criticism.

I did not watch the video either but I always got the vibe that Schiff was kinda a nut-job? Like saying the dollar would collapse and we should hoard gold and stuff...

Cassandras always sound like nut-jobs until what they say comes to pass.

Schiff has been correct on rather uncomfortable positions in the past, and his reasoning has been sound. His reasoning is sound on the dollar as well. Perhaps "collapse" is too strong a term, but pronounced inflation is predicated based upon current Fed policy. IMHO recent stock market success is a leading indicator of this eventual inflation; it is most certainly not a vote of confidence in the American economy.


Really? I always thought Schiff was bananas. Mind you, I have never followed him to closely. But, I always thought he was just an empty suit who blabbers nonsense on tv.

I know in oct 2012 he predicted the price of Gold to go from 1700 to 5000 in 2 years.

http://www.cnbc.com...

...And the price of gold is about 1300 today.

Agree that Schiff's predictions tend to have a spotty track record, and anyone mirroring his portfolio is not going to have a comfortable retirement. That's not the argument I'm making in support of Schiff's position. I've already been candid that his investment advice is not the best.

And, in 2009 he said...

"You know, look, I know inflation is going to get worse in 2010. Whether it"s going to run out of control or it"s going to take until 2011 or 2012, but I know we"re going to have a major currency crisis coming soon. It"s going to dwarf the financial crisis and it"s going to send consumer prices absolutely ballistic, as well as interest rates and unemployment."


http://krugman.blogs.nytimes.com...


Inflation has been as low as ever.

Yeah, I think where Schiff goes wrong is when he tries to play Fed Chairman when he is not Fed Chairman.

He is absolutely wrong about inflation. And, in a recession, expansionary FED policy is not much of a worry. The upward sloping yeild curve shows that a collapse should not be a concern.

You need to realize that inflation of any sort (to include rampant inflation) occurs with an upward-sloping yield curve. A downward sloping yield curve is indicative of deflation (or at least disinflation), as it signals a strong demand for cash.

Anyway, see comment #8 for why I think Schiff's views are generally sound (if not precisely correct).

I agree that bond buying will cause some inflation in the future, that is to be expected and it is worth it to help the economy in a recession. I don't like Schiff because he makes it seem like the sky is falling( I suspect just so he can get tv time that his intellect dos not warrant).

The upward sloping yield curve predicts a growing economy as well as inflation, so shiff is pulling his high inflation dropping GDP idea out of his @ss.

I would agree inflation would be a concern if the FED misses their inflation target, and would be worried if they miss it a couple of times in a row. But, the FED can always sell bonds if they need to to cool the economy down.
wrichcirw
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6/26/2014 2:34:49 AM
Posted: 2 years ago
At 6/25/2014 7:41:22 PM, twocupcakes wrote:
At 6/25/2014 12:01:16 AM, wrichcirw wrote:
At 6/24/2014 6:39:32 PM, twocupcakes wrote:
At 6/24/2014 12:23:30 AM, wrichcirw wrote:
At 6/23/2014 7:18:27 PM, twocupcakes wrote:
At 6/23/2014 10:36:37 AM, wrichcirw wrote:
I haven't spent the hour and a half to watch this particular debate, but I have read a lot of stuff from Schiff and think his views are generally pretty spot-on. The problem is that he doesn't have a viable plan as to what to do to replace or correct what he sees as wrong-doing, and his own investment ventures have been generally lackluster. It could be that time will prove him right eventually, but in the meantime, people have been losing money acting upon his advice for several years now.

It's much easier to criticize an existing plan or system than it is to actually create a system that is resistant to criticism.

I did not watch the video either but I always got the vibe that Schiff was kinda a nut-job? Like saying the dollar would collapse and we should hoard gold and stuff...

Cassandras always sound like nut-jobs until what they say comes to pass.

Schiff has been correct on rather uncomfortable positions in the past, and his reasoning has been sound. His reasoning is sound on the dollar as well. Perhaps "collapse" is too strong a term, but pronounced inflation is predicated based upon current Fed policy. IMHO recent stock market success is a leading indicator of this eventual inflation; it is most certainly not a vote of confidence in the American economy.


Really? I always thought Schiff was bananas. Mind you, I have never followed him to closely. But, I always thought he was just an empty suit who blabbers nonsense on tv.

I know in oct 2012 he predicted the price of Gold to go from 1700 to 5000 in 2 years.

http://www.cnbc.com...

...And the price of gold is about 1300 today.

Agree that Schiff's predictions tend to have a spotty track record, and anyone mirroring his portfolio is not going to have a comfortable retirement. That's not the argument I'm making in support of Schiff's position. I've already been candid that his investment advice is not the best.

And, in 2009 he said...

"You know, look, I know inflation is going to get worse in 2010. Whether it"s going to run out of control or it"s going to take until 2011 or 2012, but I know we"re going to have a major currency crisis coming soon. It"s going to dwarf the financial crisis and it"s going to send consumer prices absolutely ballistic, as well as interest rates and unemployment."


http://krugman.blogs.nytimes.com...


Inflation has been as low as ever.

Yeah, I think where Schiff goes wrong is when he tries to play Fed Chairman when he is not Fed Chairman.

He is absolutely wrong about inflation. And, in a recession, expansionary FED policy is not much of a worry. The upward sloping yeild curve shows that a collapse should not be a concern.

You need to realize that inflation of any sort (to include rampant inflation) occurs with an upward-sloping yield curve. A downward sloping yield curve is indicative of deflation (or at least disinflation), as it signals a strong demand for cash.

Anyway, see comment #8 for why I think Schiff's views are generally sound (if not precisely correct).

I agree that bond buying will cause some inflation in the future, that is to be expected and it is worth it to help the economy in a recession. I don't like Schiff because he makes it seem like the sky is falling( I suspect just so he can get tv time that his intellect dos not warrant).

The upward sloping yield curve predicts a growing economy as well as inflation, so shiff is pulling his high inflation dropping GDP idea out of his @ss.

Ok, so we agree that a growing economy and rampant inflation are not mutually exclusive. IMHO that is exactly the future we have to look forward to. It supports Schiff's commodity thesis (if not the rather extreme nature of his predictions and bets).

I don't know exactly where I stand with the whole "shadow stats" part of Schiff's argument, and I'll just leave it at that. What I will say though is that I do see inflation in the grocery aisle, and wonder about the quality of this "recovery", and see advocacy of QE to stoke a recovery as being an advocacy for future inflation.

I would agree inflation would be a concern if the FED misses their inflation target, and would be worried if they miss it a couple of times in a row. But, the FED can always sell bonds if they need to to cool the economy down.

This goes back to my comment to JMK on what the Fed typically does during an actual economic recovery. Does the Fed have a good track record of staving off "animal spirits"? Over the last 20-30 years, the record has been abysmal, and that people like Greenspan and Bernanke have instead exacerbated these spirits (i.e. attempted to foster a protracted boom) without regard for the consequences. We had various credit-induced bouts of recession (90-91, 2008-present) that were concomitant with Fed easy money policy. Then there's the whole dot-com boom, which while Greenspan is on record citing "irrational exuberance", it's questionable whether or not his actions were enough to mitigate the consequences. Or, we can put the blame on Bernanke for that one.
At 8/9/2013 9:41:24 AM, wrichcirw wrote:
If you are civil with me, I will be civil to you. If you decide to bring unreasonable animosity to bear in a reasonable discussion, then what would you expect other than to get flustered?
suttichart.denpruektham
Posts: 1,115
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8/3/2014 2:30:16 AM
Posted: 2 years ago
At 6/23/2014 10:36:37 AM, wrichcirw wrote:
I haven't spent the hour and a half to watch this particular debate, but I have read a lot of stuff from Schiff and think his views are generally pretty spot-on. The problem is that he doesn't have a viable plan as to what to do to replace or correct what he sees as wrong-doing, and his own investment ventures have been generally lackluster. It could be that time will prove him right eventually, but in the meantime, people have been losing money acting upon his advice for several years now.

It's much easier to criticize an existing plan or system than it is to actually create a system that is resistant to criticism.

I would prefer to read up his material instead of watching this... rather ling.. video as well. Can you post me a link?
wrichcirw
Posts: 11,196
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8/3/2014 3:40:36 AM
Posted: 2 years ago
At 8/3/2014 2:30:16 AM, suttichart.denpruektham wrote:
At 6/23/2014 10:36:37 AM, wrichcirw wrote:
I haven't spent the hour and a half to watch this particular debate, but I have read a lot of stuff from Schiff and think his views are generally pretty spot-on. The problem is that he doesn't have a viable plan as to what to do to replace or correct what he sees as wrong-doing, and his own investment ventures have been generally lackluster. It could be that time will prove him right eventually, but in the meantime, people have been losing money acting upon his advice for several years now.

It's much easier to criticize an existing plan or system than it is to actually create a system that is resistant to criticism.

I would prefer to read up his material instead of watching this... rather ling.. video as well. Can you post me a link?

Here's a collection of articles that Schiff wrote on an investment website:
http://seekingalpha.com...

Again, his investment advice is not particularly noteworthy other than that it does not match his reputation. It's mainly his macro thesis that IMHO has a good amount of truth to it...but exactly how to play that thesis Schiff himself has had trouble figuring out.

IMHO if he's right, then just holding normal stocks should be the most prudent course of action, as stock values will rise with the tide of inflation. This isn't taking international currency fluctuations into account.
At 8/9/2013 9:41:24 AM, wrichcirw wrote:
If you are civil with me, I will be civil to you. If you decide to bring unreasonable animosity to bear in a reasonable discussion, then what would you expect other than to get flustered?
suttichart.denpruektham
Posts: 1,115
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8/3/2014 10:52:34 AM
Posted: 2 years ago
At 8/3/2014 3:40:36 AM, wrichcirw wrote:
At 8/3/2014 2:30:16 AM, suttichart.denpruektham wrote:
At 6/23/2014 10:36:37 AM, wrichcirw wrote:
I haven't spent the hour and a half to watch this particular debate, but I have read a lot of stuff from Schiff and think his views are generally pretty spot-on. The problem is that he doesn't have a viable plan as to what to do to replace or correct what he sees as wrong-doing, and his own investment ventures have been generally lackluster. It could be that time will prove him right eventually, but in the meantime, people have been losing money acting upon his advice for several years now.

It's much easier to criticize an existing plan or system than it is to actually create a system that is resistant to criticism.

I would prefer to read up his material instead of watching this... rather ling.. video as well. Can you post me a link?

Here's a collection of articles that Schiff wrote on an investment website:
http://seekingalpha.com...

Again, his investment advice is not particularly noteworthy other than that it does not match his reputation. It's mainly his macro thesis that IMHO has a good amount of truth to it...but exactly how to play that thesis Schiff himself has had trouble figuring out.

IMHO if he's right, then just holding normal stocks should be the most prudent course of action, as stock values will rise with the tide of inflation. This isn't taking international currency fluctuations into account.

thanks