Krugminator2
Member

"Economist Milton Friedman at one time advocated a 100% reserve requirement for checking accounts, and economist Laurence Kotlikoff has also called for an end to fractional-reserve banking. Austrian School economist Murray Rothbard has written that reserves of less than 100% constitute fraud on the part of banks and should be illegal, and that full-reserve banking would eliminate the risk of bank runs. Jesús Huerta de Soto, another economist of the Austrian school, has also strongly argued in favor of full-reserve banking and the outlawing of fractional reserve banking. " https://en.wikipedia.org/wiki/Full-reserve_banking

GME is just not that important. Big night tomorrow though. Does GME finally collapse to where it belongs in the single digits? Or does it get a stay of execution for a little longer? It sure looks like it is in the death spiral. A gap down and perhaps it is lights out. Would be a healthy sign for the market to see the last bit of bubble excess wiped out

Inflation is 6% not 30%. The post I responded to was about who pays tax revenues. I agree spending is the measure of total tax but not sure how it changes anything. Direct taxation is how most spending is paid for. https://www.visualcapitalist.com/cp/us-federal-spending-versus-revenue-2021/ Stocks have their worst performance during high inflation and have negative returns when inflation is over 10% Best performance during low inflation. Inflation is bad for everyone.

The US has the most steeply progressive income tax system in the Western world. Top income earners not only pay an unfairly disproportionate amount of income taxes but pay a disproportionate amount and higher rate even when you factor in payroll taxes which affect lower income earners the most (though they shouldn't be included because they are forced savings people get back) and when you factor in the lower rate on capital gains and dividends. The reason people think "the rich" pay a lower rate is by citing sources that count unrealized capital gains as if they are income. That's it. No tax tricks. No loop holes. No secret offshore accounts. Just simply acting as if having an ownership stake in a business that increases in value over time is income. Hardly right wing sources saying the same thing. "America's Taxes are the Most Progressive in the World" https://www.washingtonpost.com/news/wonk/wp/2013/04/05/americas-taxes-are-the-most-progressive-in-the-world-its-government-is-among-the-least/ U.S. Taxes Really Are Unusually Progressive https://www.theatlantic.com/business/archive/2012/02/us-taxes-really-are-unusually-progressive/252917/

I didn't realize you wrote it. I shouldn't have been so snarky and apologize. I just assumed it was some random blog publishing a fear piece.

Didn't read. But I like how you went out of your way to call perhaps the least mainstream thing posted in the history of Ron Paul Forums mainstream. "The Ridgewood blog is written for and about Ridgewood New Jersey . It is a local event and opinion blog with a pro free market point of view. We publish local points of view about local, state and national issues." As of the 2020 United States census, the village's population was 25,979,

Russell down 2.4%. Short term March 17th (St. Patrick's Day) is the 4th most bullish day of the year. It is also Operations Expiration day which after a big up day has a bull bias. Decent odds of an intraday rally. Over the next week or two, market has a big bull bias. Biggest equity fund outflows since April 2020. https://www.lipperusfundflows.com/#create:home:Home:/php/signup_trial.php Edit: Closed flat without a rally from the original post. Kind of surprised Probably a lot of people not wanting to hold over the weekend and maybe somebody knows something. Maybe a few more percent down.

Russell has been a laggard and continues to lag which is a good lesson to not buy things that lag. But the general idea worked. 2.5% gain in the Russell from yesterday's open. Taking off half Seems like a decent chance there is new bull market in tech given how it has held up.

https://dailyspeculations.com/Letter/cane.htm Took the canes out today in the Russell on the open. We'll see.

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1. Wasn't even close to too late. Inflation expectations were still low single digits. The Fed eased for another 14 months after I wrote that. Expectations have a large influence on inflation. You live on an isolated island society with $1 million in circulation. Someone drops another $1 million on the island. Is that always inflationary? If the people on the island think that new money is permanently in circulation prices will double quickly. If people think someone will take back the $1million they dropped on the island in a few months it will have no impact on prices. 2. I have no idea what inflation will be years down the road. That is impacted by future policy decisions. Hanke thinks 2-5% by year end. https://www.wsj.com/articles/high-inflation-will-end-soon-money-supply-fed-recession-economy-growth-forecast-prediction-e2259a30 3. The official CPI numbers that had already been released would have been either 1.4% or 1.7%. What more do you want? Not only that, it was based off this article which was written in February of that year which is when I first mentioned it. 1364044709849612289

Not that it matters couldn't have been more right. It almost reads like I had a crystal ball. And it wasn't me. I just listened to a handful of monetarists Jeremy Siegel, Steve Hanke and Scott Sumner and ripped their ideas off. It isn't even worth arguing. From March 2021 when inflation was 2% (responding to your posts from then)

SVB and Signature bank went under. Equity and bond holders are getting zero. Management lost their jobs. So there isn't an incentive to go full retard. There is moral hazard for depositors who won't be as discerning at looking at banks. But that is whole problem with fractional reserve banking. There is no free market solution. It is why Rothbard thought fractional reserve banking should be outlawed as the least bad option. You had three bank failures this week. If you don't take action now, there is going to be infinitely more costly action taken later when people panic pull money out. Interest rates have gone up rapidly and most bank assets are at lower rates. How many other vulnerable banks would there be if people want to cash out in mass and those other banks have to sell assets at a loss? It sounds great to just let the world go to hell. That's how you end up with a stock market that drops 95% and people waiting in soup lines like the Great Depression. Banks should probably be treated like utilities and be a boring heavily regulated business under the current system. If you have an alternative free market solution that works, I would love to hear. Rothbard thought every action by government was socialism. But he made one pretty big exception with banking.

I am hypervigilant about these kinds of risks. I don't hold other people to the same standard. I don't think too many ever thought about a large bank that was listed as one of the best companies would go from being sound to bankrupt in two days based on a bank run. Not that Cramer should be taken seriously, but he isn't stupid either. 1634958608722169856 I would bet this whole thing is an afterthought by next week. But a lot of smart people like this guy seem pretty concerned. Having a functional banking system is one of the only legitimate functions of government.

What gains are you talking about? Having a checking account that earns zero percent interest? A checking account isn't some wild bet. If you have $5 million dollars as operating cash for a business, you think accounts at 20 different banks is practical? And incompetent people? How much time did you take understanding the interest rate duration risk of your banks balance sheet before you opened a bank account? And it isn't even about SVB. If they failed in isolation it wouldn't matter. 50% of money at regional banks is above the FDIC insurance limit Trillions of dollars. The Federal Reserve has gone Mad Max with these rate hikes. This is the kind of thing that is inevitable when you go from the policy error of extremely loose money to the opposite extreme of tight money.

What a fucking dummy of a President. The world probably won't end and everything will be fine in a few days but this is the most shortsighted thing I have ever seen. This is playing Russian Roulette for a $100. It will probably work out, unless it doesn't. Then there is mass chaos for nothing. Just stick it to those richers with their fancy checking accounts. 1634921217584144384 I like how the media is portraying people with checking accounts at the 16th largest bank that was completely solvent as risky gambling elites. Also. 1634539450557505537

1634413306948603905 1634416692301373442 1634418925331968007 1634429916778491905 1634564398919368704 1634669060402081792 But the opposite seems very possible.

I just want to gouge my eyes out everytime I read what people have to say about this. Businesses hold millions or billions over the 250k FDIC insured limit. They need a place to store money risk free to operate and pay workers. Apple is not Pablo Escobar where they bury cash in barrels. Banks made a ton of loans and bought Treasuries mostly at interest rates lower than the current rates. Since we have a fractional reserve system, if depositors want cash now those banks would have to sell at depressed prices and if enough depositors want out the banking system would be insolvent. It won't be an issue if the banks hold their debt to maturity. The Federal Reserve can nip this in the bud by making a strong guarantees to depositors to prevent runs. It has to be done this weekend. This is a five alarm fire. The Federal Reserve exists as the lender of last resort. It is fine to believe the Fed shouldn't exist but they do. I don't think the three point line should exist but it does and if I were a GM building a basketball team I would build it around three point shooters. Not guaranteeing depositors money would be like eliminating the three point line in the NBA finals.

M2 had the biggest collapse in history last year. The fact that Powell and all these (mostly left wing) economists are still babbling about inflation is why there was inflation in the first place. M2 is saying the job is done. It has been done for months. When the three month Treasury yield is above the 2 year, you are making a policy mistake. The old Mises analogy is they ran someone over by creating the inflation and now they think the solution is to back up and run over the person again by creating deflation. The insane part of all of this is nothing is going to be more inflationary than by creating a crisis that requires bailouts from off the charts tight money. Schiff is probably right in his analysis that the Fed has the same issue as Silicon Valley bank in the sense that it is sitting on 8 trillion of low interest debt while rates have risen. It is sitting on nearly infinite mark to market losses that if they tried to unload this debt as part of monetary policy it would seem like it would cause problems.

Just reading the comments on Twitter, the number of people who think depositors should be wiped out makes me think the average person should be turned into Soylent Green. Making depositors whole isn't a bailout for rich people. Every company over a mom and pop business has more than 250k in the bank. If you let depositors lose above deposit insurance you will have runs on every bank. Apple has to put billions somewhere. There is no economy without a functional banking system.

Is that you Elizabeth Warren? Buybacks and dividends are the same thing but a buyback is more tax efficient. I am still trying to figure out why any company that is not ridiculously overvalued would ever pay a dividend over buying back stock.

https://www.wsj.com/articles/high-inflation-will-end-soon-money-supply-fed-recession-economy-growth-forecast-prediction-e2259a30?mod=e2two

It is rather amusing that only 50% of blacks saying it's okay to be white is seen as perfectly normal by the people criticizing Adams.

I don't get the fetish of making up inflation numbers that are ridiculously easy to prove false. Inflation was never 15% after QE1 started Not even close. More like 1-2%. If inflation averaged 7% after 2008 prices would have more than doubled by the start of Covid in 2020. Which they didn't. Just pull up a price chart all the listed commodities. https://finviz.com/futures_charts.ashx?p=m1 Right now no one (except a few free market economists) is saying inflation is 2-3% and likely to drop. The official numbers peaked at 9% and are currently 6.4% Here is the reality. "They" systematically overstate inflation. The government is lying but in the other direction than you think to make it look like the economy has grown more slowly than it actually has. Inflation is Even More Inflated Than We Thought https://www.econlib.org/archives/2017/10/inflation_is_ev.html