{"id":1319,"date":"2010-07-27T08:44:10","date_gmt":"2010-07-27T14:44:10","guid":{"rendered":"http:\/\/ishmaels.net\/blog\/?p=1319"},"modified":"2010-07-27T08:44:10","modified_gmt":"2010-07-27T14:44:10","slug":"great-stuff-from-the-pragmatic-capitalist-repost","status":"publish","type":"post","link":"https:\/\/www.ishmaels.net\/blog\/2010\/07\/27\/great-stuff-from-the-pragmatic-capitalist-repost\/","title":{"rendered":"Great stuff from the Pragmatic Capitalist &#8211; REPOST"},"content":{"rendered":"<p>WoW&#8230; This might <strong class='StrictlyAutoTagBold'>make<\/strong> you just a little nervous about our economic situation? Is he (Geithner) just spouting the company line or really believes this bunk.  According to this he was instrumental in the development of the problem and I would be he doesn&#8217;t run his own finances this way. &#8211; WD0AJG<\/p>\n<h2 class=\"entry-title\" style=\"max-width: 650px; font-size: 18px; margin: 0px;\"><\/h2>\n<h2 class=\"entry-title\" style=\"max-width: 650px; font-size: 18px; margin: 0px;\"><a href=\"http:\/\/pragcap.com\/tim-geithner-doesnt-get-it\">TIM GEITHNER DOESN\u2019T GET IT<\/a><\/h2>\n<h2 class=\"entry-title\" style=\"max-width: 650px; font-size: 18px; margin: 0px;\"><a class=\"entry-title-link\" style=\"color: #7c8cc5; text-decoration: none;\" href=\"http:\/\/pragcap.com\/tim-geithner-doesnt-get-it\" target=\"_blank\"><\/a><\/h2>\n<div class=\"entry-author\" style=\"color: #666666; text-decoration: none; margin: 0px;\"><span class=\"entry-author-parent\">by&nbsp;<span class=\"entry-author-name\">TPC<\/span><\/span><\/div>\n<div class=\"entry-body\" style=\"max-width: 650px; padding-top: 0.5em; color: #222222; margin: 0px;\">\n<div style=\"margin: 0px;\">\n<div class=\"item-body\" style=\"margin: 0px;\">\n<div style=\"margin: 0px;\">\n<p>At least Ben Bernanke isn\u2019t the only person in <strong class='StrictlyAutoTagBold'>government<\/strong> who doesn\u2019t really understand our monetary system.&nbsp; Over the weekend Tim Geithner paraded himself all over the weekend talk shows while he proved that he barely deserved to pass econ 101.&nbsp; That\u2019s right, the Secretary of the US Treasury doesn\u2019t get it.<\/p>\n<p>The interviews mostly began with Mr. Geithner distancing himself from the entire cause of this crisis.&nbsp; Although he was effectively the fox in the hen house (he was President of the NY Fed while we experienced the grossest bank expansion\/leveraging experiment in the history of the world) Mr. Geithner continues to <strong class='StrictlyAutoTagBold'>make<\/strong> it sound as if he was saddled with this problem and played no role in its cause:<\/p>\n<blockquote>\n<p>&ldquo;I, I think I disagree slightly in the sense that, you know, remember, this was a recession caused by a set of policies that left us with a $1.3 trillion deficit when the president came into office, an <strong class='StrictlyAutoTagBold'>economy<\/strong> that was falling off the cliff. Millions of Americans had already lost their jobs. The recession was a year old at that point.\u201d<\/p>\n<\/blockquote>\n<p>Mr. Geithner goes on to explain that there is no chance of a double dip (famous last words?).&nbsp; He displays absolutely zero sense of <strong class='StrictlyAutoTagBold'>risk<\/strong> management and prescience.&nbsp; This shouldn\u2019t be surprising to anyone.&nbsp;&nbsp;<a style=\"color: #7c8cc5;\" href=\"http:\/\/pragcap.com\/should-ben-bernanke-be-reappointed\" target=\"_blank\">It is the tendency of government officials to adhere to the scientific method<\/a>&nbsp;\u2013 \u201clet\u2019s wait for the dust to settle before we <strong class='StrictlyAutoTagBold'>make<\/strong> our next moves\u201d.&nbsp;&nbsp; Unfortunately, that\u2019s not how markets work and it\u2019s certainly not how economies work.&nbsp; Mr. Geithner is blindingly optimistic:<\/p>\n<blockquote>\n<p>&ldquo;MR. GREGORY: So just to be precise, you do not believe in a double-dip recession, that it will get worse before it gets better?<\/p>\n<\/blockquote>\n<blockquote>\n<p>SEC\u2019Y GEITHNER: No, I don\u2019t. I think the most likely thing is, you see an <strong class='StrictlyAutoTagBold'>economy<\/strong> that gradually strengthens over the next year or two, you see job growth start to come back again.\u201d<\/p>\n<\/blockquote>\n<p>Mr. Geithner then goes on to explain how he totally misunderstands how a fiat currency <strong class='StrictlyAutoTagBold'>system<\/strong> in a floating exchange <strong class='StrictlyAutoTagBold'>system<\/strong> works.&nbsp; It\u2019s 100% crystal clear that Geithner is living in his textbook gold standard world where the USA borrows money to finance spending &#8211;<a style=\"color: #7c8cc5;\" href=\"http:\/\/pragcap.com\/the-concept-of-vertical-and-horizontal-money-creation\" target=\"_blank\">&nbsp;nothing could be farther from the truth<\/a>.&nbsp; The Treasurer of the USA says we \u201cborrow\u201d to \u201cfinance\u201d our spending:<\/p>\n<blockquote>\n<p>&ldquo;I think this is a responsible way to do it. You know, my job, David, is to help <strong class='StrictlyAutoTagBold'>make<\/strong> sure we can borrow to finance the obligations that Congress gives us.\u201d<\/p>\n<\/blockquote>\n<p>Mr. Geithner then continues his rambling diatribe by offering up an explanation for why we can afford to continue borrowing and why interest rates are so low:<\/p>\n<blockquote>\n<p>&ldquo;David, we can afford to do it this way. I\u2019m completely confident we can. And if you look, again, at what we\u2019re paying to borrow now, we\u2019ve got very low interest rates as a country, in part because people around the world and Americans have a lot of confidence in our capacity as a <strong class='StrictlyAutoTagBold'>country<\/strong> to <strong class='StrictlyAutoTagBold'>make<\/strong> sure we manage through these challenges.\u201d<\/p>\n<\/blockquote>\n<p><a style=\"color: #7c8cc5;\" href=\"http:\/\/pragcap.com\/when-will-the-bond-auctions-begin-to-fail\" target=\"_blank\">Of course we can afford it<\/a>.&nbsp; We are the largest and most productive <strong class='StrictlyAutoTagBold'>economy<\/strong> in the world.&nbsp; There is enormous demand for our currency.&nbsp; We have an output have you could drive a Mack Truck though.&nbsp; We have Harvard graduates applying for jobs at Starbucks.&nbsp; The amount of idle capacity is an outrage.&nbsp; As a nation, we can always always afford to spend in the currency we create so long as there is a productive <strong class='StrictlyAutoTagBold'>economy<\/strong> that backs that currency and the USA does not lose its ability to tax that productivity.<\/p>\n<p>Mr. Geithner believes interest rates are low because the <strong class='StrictlyAutoTagBold'>risk<\/strong> of insolvency is low.&nbsp; Of course the <strong class='StrictlyAutoTagBold'>risk<\/strong> of insolvency is low in the USA \u2013&nbsp;<a style=\"color: #7c8cc5;\" href=\"http:\/\/pragcap.com\/jeff-gundlach-says-the-usa-will-default\" target=\"_blank\">because there is no insolvency risk in the USA<\/a>.&nbsp; Despite the ranting and raving of many market pundits in recent years a bet on US insolvency has been an absolute disaster.&nbsp;&nbsp; Interest rates are low today because the market is worried that the USA is at <strong class='StrictlyAutoTagBold'>risk<\/strong> of years of very low growth and below trend inflation rates.&nbsp; Insolvency is not an issue, yet Mr. Geithner believes we need to cut the deficit so we can reassure the rest of the world:<\/p>\n<blockquote>\n<p>&ldquo;But we have to <strong class='StrictlyAutoTagBold'>make<\/strong> some choices, too, and we have to <strong class='StrictlyAutoTagBold'>make<\/strong> sure we can continue to earn confidence around the world that we\u2019re going to have the will as a <strong class='StrictlyAutoTagBold'>country<\/strong> to bring these large inherited deficits down over time to a much more manageable level.&nbsp; We think that\u2019s the responsible thing to do because we need to <strong class='StrictlyAutoTagBold'>make<\/strong> sure we can show the world that (we\u2019re) willing as a <strong class='StrictlyAutoTagBold'>country<\/strong> now to start to <strong class='StrictlyAutoTagBold'>make<\/strong> some progress bringing down our long-term deficits.\u201d<\/p>\n<\/blockquote>\n<p>And we wonder why the <strong class='StrictlyAutoTagBold'>economy<\/strong> in this <strong class='StrictlyAutoTagBold'>country<\/strong> is such a mess after all this time?&nbsp; Mr. Geithner has no clue how the <strong class='StrictlyAutoTagBold'>system<\/strong> actually works.&nbsp; If he did, he would have taken responsibility for his part in the crisis and never taken a job that is clearly well beyond his capabilities.&nbsp;&nbsp;<a style=\"color: #7c8cc5;\" href=\"http:\/\/pragcap.com\/bernankes-great-monetarist-gaffe\" target=\"_blank\">He would have never helped Ben Bernanke devise his great bank rescue plan<\/a>&nbsp;which has been an utter waste of <strong class='StrictlyAutoTagBold'>government<\/strong> resources and failed on all levels (except making bankers more wealthy).<\/p>\n<p>Mr. Geithner might have sounded at least partially credible if he\u2019d spent more time talking about cutting wasteful spending as opposed to letting tax cuts expire (which is an effective tax hike &ndash; the last thing the debt saddled private sector needs right now).&nbsp; But it\u2019s clear Mr. Geithner doesn\u2019t understand how a sovereign issuer of currency in a floating exchange <strong class='StrictlyAutoTagBold'>system<\/strong> actually functions.&nbsp; He\u2019s more worried about non-existent bond vigilantes and China as our banker (which they aren\u2019t).&nbsp;&nbsp;<a style=\"color: #7c8cc5;\" href=\"http:\/\/pragcap.com\/alan-greenspan-sounds-the-bond-vigilante-siren-call\" target=\"_blank\">Let&rsquo;s just hope Geithner&rsquo;s model isn&rsquo;t as horribly flawed as Mr. Greenspan&rsquo;s was<\/a>.&nbsp; Unfortunately, the evidence leads me to believe it might even be worse&hellip;.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>WoW&#8230; This might make you just a little nervous about our economic situation? Is he (Geithner) just spouting the company line or really believes this bunk. According to this he was instrumental in the development of the problem and I would be he doesn&#8217;t run his own finances this way. &#8211; WD0AJG<\/p>\n<p> TIM GEITHNER DOESN\u2019T GET IT by&nbsp;TPC <\/p>\n<p>At least Ben Bernanke isn\u2019t the only person in government who doesn\u2019t really understand our monetary system.&nbsp; Over the weekend Tim Geithner paraded himself all over the weekend talk shows while he proved that he barely deserved to pass econ 101.&nbsp; That\u2019s right, the Secretary of the US Treasury doesn\u2019t get it.<\/p>\n<p>The interviews mostly began with Mr. Geithner distancing himself from the entire cause of this <\/p>\n<p><a href=\"https:\/\/www.ishmaels.net\/blog\/2010\/07\/27\/great-stuff-from-the-pragmatic-capitalist-repost\/\">&#8220;And Now the Rest of the Story &#8211; &#8220;Great stuff from the Pragmatic Capitalist &#8211; REPOST<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[1],"tags":[25],"class_list":["post-1319","post","type-post","status-publish","format-standard","hentry","category-uncategorized","tag-aprs","odd"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Great stuff from the Pragmatic Capitalist - REPOST - And That was How it Went<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.ishmaels.net\/blog\/2010\/07\/27\/great-stuff-from-the-pragmatic-capitalist-repost\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Great stuff from the Pragmatic Capitalist - REPOST - And That was How it Went\" \/>\n<meta property=\"og:description\" content=\"WoW&#8230; This might make you just a little nervous about our economic situation? Is he (Geithner) just spouting the company line or really believes this bunk. According to this he was instrumental in the development of the problem and I would be he doesn&#8217;t run his own finances this way. &#8211; WD0AJG TIM GEITHNER DOESN\u2019T GET IT by&nbsp;TPC At least Ben Bernanke isn\u2019t the only person in government who doesn\u2019t really understand our monetary system.&nbsp; Over the weekend Tim Geithner paraded himself all over the weekend talk shows while he proved that he barely deserved to pass econ 101.&nbsp; That\u2019s right, the Secretary of the US Treasury doesn\u2019t get it. 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Is he (Geithner) just spouting the company line or really believes this bunk. According to this he was instrumental in the development of the problem and I would be he doesn&#8217;t run his own finances this way. &#8211; WD0AJG TIM GEITHNER DOESN\u2019T GET IT by&nbsp;TPC At least Ben Bernanke isn\u2019t the only person in government who doesn\u2019t really understand our monetary system.&nbsp; Over the weekend Tim Geithner paraded himself all over the weekend talk shows while he proved that he barely deserved to pass econ 101.&nbsp; That\u2019s right, the Secretary of the US Treasury doesn\u2019t get it. 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Just hate Car Salesmen","author":"wd0ajg","date":"March 27, 2012","format":false,"excerpt":"The other day I stated I might be interested in an Orange Jeep then figured it may be too much orange and saw that bike but figure there is no way I would get one of those\u2026 ... on my trip to Enid I spotted one that was Orange but\u2026","rel":"","context":"In \"BBS\"","block_context":{"text":"BBS","link":"https:\/\/www.ishmaels.net\/blog\/tag\/bbs\/"},"img":{"alt_text":"orange jeep 007 (1280x960) (1280x960)","src":"https:\/\/i0.wp.com\/ishmaels.net\/blog\/wp-content\/uploads\/2012\/03\/orange-jeep-007-1280x960-1280x960_thumb.jpg?resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/ishmaels.net\/blog\/wp-content\/uploads\/2012\/03\/orange-jeep-007-1280x960-1280x960_thumb.jpg?resize=350%2C200 1x, https:\/\/i0.wp.com\/ishmaels.net\/blog\/wp-content\/uploads\/2012\/03\/orange-jeep-007-1280x960-1280x960_thumb.jpg?resize=525%2C300 1.5x"},"classes":[]},{"id":16665,"url":"https:\/\/www.ishmaels.net\/blog\/2014\/07\/16\/mutual-understanding\/","url_meta":{"origin":1319,"position":1},"title":"Mutual Understanding","author":"wd0ajg","date":"July 16, 2014","format":false,"excerpt":"The new dog and cat have reached a mutual understanding\u2026 \u201cWe both live here so we are going to agree to be in the same room\u201d\u2026 but the cat makes it clear when the dog has been close enough or she has had all the dog she wants\u2026 so far\u2026.\u2026","rel":"","context":"Similar post","block_context":{"text":"Similar post","link":""},"img":{"alt_text":"1-SAM_1706","src":"https:\/\/i0.wp.com\/ishmaels.net\/blog\/wp-content\/uploads\/2014\/07\/1-SAM_1706_thumb.jpg?resize=350%2C200","width":350,"height":200},"classes":[]},{"id":16815,"url":"https:\/\/www.ishmaels.net\/blog\/2014\/08\/06\/a-good-box-is-a-wonderful-thing\/","url_meta":{"origin":1319,"position":2},"title":"A good box is a wonderful thing\u2026","author":"wd0ajg","date":"August 6, 2014","format":false,"excerpt":"Yep, the cat we took in from our grandson has a thing about boxes\u2026 just about any old box will do\u2026 although some are better than others\u2026 This was her favorite\u2026 they brought it along with her\u2026 I got some stuff from Staples the other day\u2026 left this one on\u2026","rel":"","context":"Similar post","block_context":{"text":"Similar post","link":""},"img":{"alt_text":"1-SAM_1705","src":"https:\/\/i0.wp.com\/ishmaels.net\/blog\/wp-content\/uploads\/2014\/08\/1-SAM_1705_thumb.jpg?resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/ishmaels.net\/blog\/wp-content\/uploads\/2014\/08\/1-SAM_1705_thumb.jpg?resize=350%2C200 1x, https:\/\/i0.wp.com\/ishmaels.net\/blog\/wp-content\/uploads\/2014\/08\/1-SAM_1705_thumb.jpg?resize=525%2C300 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venue again","author":"wd0ajg","date":"March 25, 2016","format":false,"excerpt":"Yesterday the roads were passable so I went out for some burgers for lunch and got some chicken nuggets for GS#3.\u00a0 He seemed to like them. The dogs know he has a tendency to drop or throw stuff off he doesn\u2019t like so they all gather around and wait\u2026 Then\u2026","rel":"","context":"Similar post","block_context":{"text":"Similar post","link":""},"img":{"alt_text":"SAM_3886","src":"https:\/\/i0.wp.com\/ishmaels.net\/blog\/wp-content\/uploads\/2016\/03\/SAM_3886_thumb.jpg?resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/ishmaels.net\/blog\/wp-content\/uploads\/2016\/03\/SAM_3886_thumb.jpg?resize=350%2C200 1x, https:\/\/i0.wp.com\/ishmaels.net\/blog\/wp-content\/uploads\/2016\/03\/SAM_3886_thumb.jpg?resize=525%2C300 1.5x, https:\/\/i0.wp.com\/ishmaels.net\/blog\/wp-content\/uploads\/2016\/03\/SAM_3886_thumb.jpg?resize=700%2C400 2x"},"classes":[]}],"_links":{"self":[{"href":"https:\/\/www.ishmaels.net\/blog\/wp-json\/wp\/v2\/posts\/1319","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.ishmaels.net\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.ishmaels.net\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.ishmaels.net\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.ishmaels.net\/blog\/wp-json\/wp\/v2\/comments?post=1319"}],"version-history":[{"count":0,"href":"https:\/\/www.ishmaels.net\/blog\/wp-json\/wp\/v2\/posts\/1319\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.ishmaels.net\/blog\/wp-json\/wp\/v2\/media?parent=1319"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.ishmaels.net\/blog\/wp-json\/wp\/v2\/categories?post=1319"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.ishmaels.net\/blog\/wp-json\/wp\/v2\/tags?post=1319"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}