Bear Pit: now the sole domicile of politics at LuLa

[Ray]

Trump's just as bad.  He believes in debt as a real estate developer.  In any case, it's not reducing taxes that causes inflation.  It's when you print currency to make up for the shortfall in taxes required to pay for government budget expenses. Everyone loves tax reductions.  We just don't want them to cut spending because we'll lose out on free stuff, that really isn't free anyway, in the end.

In the absence of wars and unpredictable natural events such as volcanic eruptions and earthquakes, the prosperity of any nation is dependent upon the true cost and reliable availability of energy supplies, and the sensible and efficient ways we use that energy. Money just represents an efficient means of distributing the products which result from the use of those energy supplies.

An example of the problems the USA should be concerned about is what is currently happening in Texas. They've moved towards unreliable power sources in order to protect themselves (and the world) from excessive warming, but have now experienced in Texas the devastation of excessive cooling, which apparently they didn't prepare for. How ironic. 

[Robert Roaldi]

Because accounts are supposedly insured by the government, no one cares about the creditworthiness of the banking institution.  Years ago, you'd check and make sure before you gave them your money.  Also, the bank themselves would be extra careful with investments.  They would not put money in those DDD-rated junk real estate mortgages like in 2008.  If depositors felt the bank was taking risks with their money, the depositor would clear out their funds. The bank would fail.   So both sides were careful.  Then moral hazard was created by the FDIC.  No one does their homework anymore.  Everyone thinks the government is protecting them when they're not.

Deposit insurance as moral hazard, interestingly flawed point of view. I guess it's better to have sharp bankers con money out of people who couldn't understand the fine print if they tried. But hey, caveat emptor, right. What!, you expected the bank to be safe?  You fools.

Explain why when a Texan electrical grid fails, conveniently followed by spikes in energy prices because of the self-caused shortage of power, explain to me why THAT isn't a moral hazard, but rather just the "free market" as god intended.

Union salaries sunk GM but managerial bonus payouts to people who ran the company into the ground, that's the free market.

Bullshit, all of it.

[Alan Klein]

In the absence of wars and unpredictable natural events such as volcanic eruptions and earthquakes, the prosperity of any nation is dependent upon the true cost and reliable availability of energy supplies, and the sensible and efficient ways we use that energy. Money just represents an efficient means of distributing the products which result from the use of those energy supplies.

An example of the problems the USA should be concerned about is what is currently happening in Texas. They've moved towards unreliable power sources in order to protect themselves (and the world) from excessive warming, but have now experienced in Texas the devastation of excessive cooling, which apparently they didn't prepare for. How ironic. 

Well the green environmentalists are blaming climate change.  They've learned not to blame global warming for cold snaps. 

Regarding energy, I wouldn't say that's the only thing that represents a country's wealth.  Mainly, it's the productivity of its people.  What good is energy if you don't have teachers, doctors, barbers, farmers, and photographers and others who produce things and provide services? Currency represents all the products and goods and services.  It's a store of value of those things as well as energy, just another product. It's just when you print more money when no extra or less productivity is produced that you devalue the currency. 

[faberryman]

An example of the problems the USA should be concerned about is what is currently happening in Texas. They've moved towards unreliable power sources in order to protect themselves (and the world) from excessive warming, but have now experienced in Texas the devastation of excessive cooling, which apparently they didn't prepare for. How ironic. 

Are you nuts? Texas didn't move "towards unreliable power sources in order to protect themselves (and the world) from excessive warming". Texans don't believe in climate change. Not only that, it would have required planning. Their grid was unreliable because Texas didn't require the energy suppliers to make investments to make the grid reliable. That meant the energy suppliers got wealthier and, to throw the dog a bone, consumers got lower energy prices. So when an unplanned for emergency arose, they were shit out of luck. "Sorry. Oops." Thankfully AOC, everyone's favorite socialist, was there to save the day with water and groceries. Even Ted Cruz got involved. Instead of quarantining after his trip to Cancun to buy Snowflake a tutu, he loaded a couple of cases of water bottles into some peoples' car trunks until he threw his back out because he had never done a lick of work in his life. (I don't know whether Ted Cruz really threw his back out or not, but it's not beyond the realm of possibility and it sounded good.)

[Alan Klein]

Deposit insurance as moral hazard, interestingly flawed point of view. I guess it's better to have sharp bankers con money out of people who couldn't understand the fine print if they tried. But hey, caveat emptor, right. What!, you expected the bank to be safe?  You fools.

Explain why when a Texan electrical grid fails, conveniently followed by spikes in energy prices because of the self-caused shortage of power, explain to me why THAT isn't a moral hazard, but rather just the "free market" as god intended.

Union salaries sunk GM but managerial bonus payouts to people who ran the company into the ground, that's the free market.

Bullshit, all of it.

How did the SEC protect Madoff's investors?  They didn't. How did the SEC protect those Robinhood investors? They didn't When banks invested in DDD-rated mortgages and went bust in 2008, how were homeowners protected when their homes dropped 30% in value because of the bank's foolishness and fraud?  The Fed was the cause of that too.  Just like now, they're keeping interest rates too low and pumping money creating bubbles that will explode and ruin millions of investors making them poor again.  It's the government that causes all these problems, not the free market.

Many of these protective rules and regulations mean well.  But they create moral hazards.  People think they're protected when they're really not. That's not to say we don;lt need some rules and regulations.  But the main problem is people are greedy and think they'll never get hurt. Look at the stock market now.  The economy is in turmoil, yet the market is at its highest level ever.  Bitcoin, a product that is just bits of ones and zeros in a wire is worth $50K.  You can't eat it, hang it, wear it, or make telephone calls with it.  Who's protecting against all that silliness? Government agencies and regulations can't help. A fool and his money are soon parted. 

[faberryman]

How did the SEC protect Madoff's investors?  They didn't. How did the SEC protect those Robinhood investors? They didn't When banks invested in DDD-rated mortgages and went bust in 2008, how were homeowners protected when their homes dropped 30% in value because of the bank's foolishness and fraud?  The Fed was the cause of that too.  Just like now, they're keeping interest rates too low and pumping money creating bubbles that will explode and ruin millions of investors making them poor again.  It's the government that causes all these problems, not the free market.

Many of these protective rules and regulations mean well.  But they create moral hazards.  People think they're protected when they're really not. That's not to say we don;lt need some rules and regulations.  But the main problem is people are greedy and think they'll never get hurt. Look at the stock market now.  The economy is in turmoil, yet the market is at its highest level ever.  Bitcoin, a product that is just bits of ones and zeros in a wire is worth $50K.  You can't eat it, hang it, wear it, or make telephone calls with it.  Who's protecting against all that silliness? Government agencies and regulations can't help. A fool and his money are soon parted.

Just shoot me and get it over with. Well, give me about an hour. My wife made these pretty great sticky buns this morning and I haven't finished my second cup of coffee.

[Alan Klein]

Are you nuts? Texas didn't move "towards unreliable power sources in order to protect themselves (and the world) from excessive warming". Texans don't believe in climate change. Not only that, it would have required planning. Their grid was unreliable because Texas didn't require the energy suppliers to make investments to make the grid reliable. That meant the energy suppliers got wealthier and, to throw the dog a bone, consumers got lower energy prices. So when an unplanned for emergency arose, they were shit out of luck. "Sorry. Oops." Thankfully AOC, everyone's favorite socialist, was there to save the day with water and groceries. Even Ted Cruz got involved. Instead of quarantining after his trip to Cancun to buy Snowflake a tutu, he loaded a couple of cases of water bottles into some peoples' car trunks until he threw his back out because he had never done a lick of work in his life. (I don't know whether Ted Cruz really threw his back out or not, but it's not beyond the realm of imagination and it sounded good.)

I don't know whether regulators or who were at fault.  But, there are always catastrophes that happen that all the plans of mice and men will be to no avail.  It's impossible to plan for every emergency or continguency.  There's a limit to how much money you can spend.  Do you have sprinklers installed in your house?  why not?  You know that smoke detectors only alert you to a fire but sprinklers put out the fire.  Why haven't you spent the money to protect your family? 

There's only so much money to go around.  People, institutions governments, utilities, etc have to stop somewhere.  This cold snap had not occurred in a hundred years.  If you look at FEMA flood maps for insurance, they separate the areas by 100 years floods, 50-year floods, etc.  If you get a mortgage, you need flood insurance if you're within a certain zone.  Well, why not the less frequent zone?  At some point, just like sprinklers, you cut off more spending because of diminishing returns.

Of course, God laughs at our logic and pulls a fast one just to keep us on our toes and our hubris in check.  But disasters will always happen whether earthquakes or fires in California, storm surges on my Jersey Shore, or freezing in Texas.  I hear they get locusts in Texas too, every now and then.

[Alan Klein]

Just shoot me and get it over with. Well, give me about an hour. My wife made these pretty great sticky buns this morning and I haven't finished my second cup of coffee.

Sticky buns are bad for the heart.  Have you paid up your life insurance?  We all need to stay protected just in case.

[Peter McLennan]

Maybe it was because he forgot to add his often used insults.

A spoonful of vitriol helps the medicine go down.

[Alan Klein]

Apparently, Texas has a special program where people can buy at a cheap rate around 2 cents KWH.  It's like floating mortgage rates that can go up.  You're not locked in like the rest of the public.  Of course, think of all the years these people saved money.  Now they have to give it back.  Why do people take chances with floating mortgage rates and floating utility rates? But blaming the utility company for choices individuals make doesn't seem right either.  But, I agree, there should be a cap.  It's not fair that a poor dirt farmer in Texas would have to buy the whole utility plant. 
https://apnews.com/article/texas-high-electric-bills-e8cb3450888464a059e3132b23cb6f5d

I'm checking with our township's business administrator here in New Jersey what the situation is as we also get lower rates as part of a deal we made.  He said he thinks ours cannot be raised. But where have you heard that before?  He's is still checking with his advisors on the matter and is suppose to get back to me.

[digitaldog]

Sticky buns are bad for the heart.  Have you paid up your life insurance?  We all need to stay protected just in case.

Perhaps a Alan would like to share with us his BMI or height and weight. I didn’t think so.

[jeremyrh]

It's just when you print more money when no extra or less productivity is produced that you devalue the currency.

Aha - dangerously close to the truth!! So printing money while reducing unemployment is a good thing.

[faberryman]

Do you have sprinklers installed in your house?  why not?  You know that smoke detectors only alert you to a fire but sprinklers put out the fire.  Why haven't you spent the money to protect your family?

I wrote a lengthy response to these same questions you asked last week, so either you didn't read it or you don't remember, and I am not going to type it all up again. 

There's only so much money to go around.  People, institutions governments, utilities, etc have to stop somewhere.  This cold snap had not occurred in a hundred years.  If you look at FEMA flood maps for insurance, they separate the areas by 100 years floods, 50-year floods, etc.  If you get a mortgage, you need flood insurance if you're within a certain zone.  Well, why not the less frequent zone?  At some point, just like sprinklers, you cut off more spending because of diminishing returns.

Well, I know enough about FEMA flood maps to know that if you live in a 100 year flood zone it doesn't mean it only floods once every 100 years. You can have so-called 100 year floods in back to back years. It's something to think about.

Of course, God laughs at our logic and pulls a fast one just to keep us on our toes and our hubris in check.  But disasters will always happen whether earthquakes or fires in California, storm surges on my Jersey Shore, or freezing in Texas.  I hear they get locusts in Texas too, every now and then.

I don't much believe in that whole God thing, but religion certainty is a handy thing to have in your back pocket in case something happens you didn't plan for. Don't blame me, it's God's fault. We don't have time enough, and I can't type fast enough, to have an in-depth discussion about the problem of evil.

[faberryman]

Perhaps a Alan would like to share with us his BMI or height and weight. I didn’t think so.

I know I grew an inch taller last year.

[Alan Klein]

Aha - dangerously close to the truth!! So printing money while reducing unemployment is a good thing.

It's not reducing unemployment.  It's stopping people from looking for work.  Why work when the government is giving you money to stay home?   

Also, sending money to zombie companies to keep them alive is just postponing the shutdowns [bankruptcies] and wasting public money and resources.  If the government has to spend money, then at least it should be for infrastructure that will benefit the economy.  Better roads, bridges, and facilities improve long-range economic advantages.  Just printing and handing it out devalues it making living more expensive for low-income, poor, and fixed-income people.  Food prices go up and other necessities as well.  Then next year, taxes have to be raised to pay the printing back.  That hurts business and the economy losing jobs and income for everyone.  Good intentions just make things worse.

[Alan Klein]

I wrote a lengthy response to these same questions you asked last week, so either you didn't read it or you don't remember, and I am not going to type it all up again. 

Well, I know enough about FEMA flood maps to know that if you live in a 100 year flood zone it doesn't mean it only floods once every 100 years. You can have so-called 100 year floods in back to back years. It's something to think about.

I don't much believe in that whole God thing, but religion certainty is a handy thing to have in your back pocket in case something happens you didn't plan for. Don't blame me, it's God's fault. We don't have time enough, and I can't type fast enough, to have an in-depth discussion about the problem of evil.

Act of God is a common legal inclusion in many contracts.  It does seem strange that lawyers would use that term though.    “force majeure” seems to be a better lawyer copout.
https://www.natlawreview.com/article/breach-contract-or-act-god

[faberryman]

Act of God is a common legal inclusion in many contracts.  It does seem strange that lawyers would use that term though.    “force majeure” seems to be a better lawyer copout.
https://www.natlawreview.com/article/breach-contract-or-act-god

They have one set of documents for believers and another set of documents for non-believers. It is sort of a political correctness thing. And it depends on which side of the table you sit on whether it is a cop-out or skilled lawyering.

[TechTalk]

As a quick response to some posts here recently, the freeze in Texas is caused by frigid arctic air in the polar vortex which is normally contained by the jet stream in a pattern moving west to east in the northern latitudes. Unusually warm air in the stratosphere above the Arctic disrupted the polar vortex and the normal jet stream pattern causing arctic air to flow south instead of west to east. That is the condensed version. The extremely short version is that cold air in Texas is the result of warm air above the Arctic.

The degree to which global warming is impacting this type of event is, and has been for some time, a subject of study among climate scientists with no clear consensus yet developed. However, arctic regions are warming at a much faster rate that the rest of the planet. So, it will continue to be a source of interest to scientists. This is an unusual but well known phenomenon to scientists, as well as Texas regulators and utilities, as it has happened before.

For those with 3-1/2 minutes to spare, there is an animated video from 2019 that explains the phenomenon.

https://www.youtube.com/How Arctic Amplification Affects the Polar Vortex

[Alan Klein]

Apparently, Texas has a special program where people can buy at a cheap rate around 2 cents KWH.  It's like floating mortgage rates that can go up.  You're not locked in like the rest of the public.  Of course, think of all the years these people saved money.  Now they have to give it back.  Why do people take chances with floating mortgage rates and floating utility rates? But blaming the utility company for choices individuals make doesn't seem right either.  But, I agree, there should be a cap.  It's not fair that a poor dirt farmer in Texas would have to buy the whole utility plant. 
https://apnews.com/article/texas-high-electric-bills-e8cb3450888464a059e3132b23cb6f5d

I'm checking with our township's business administrator here in New Jersey what the situation is as we also get lower rates as part of a deal we made.  He said he thinks ours cannot be raised. But where have you heard that before?  He's is still checking with his advisors on the matter and is suppose to get back to me.

The administrator just got back to me.  Apparently, I, my township, and all of New Jersey are protected against what happened in Texas.  No sudden huge rate increases if something similar with power breakdowns occur.  Tomorrow, he's getting me the report from their advisors. 

[Alan Klein]

They have one set of documents for believers and another set of documents for non-believers. It is sort of a political correctness thing. And it depends on which side of the table you sit on whether it is a cop-out or skilled lawyering.

Either way the lawyers get paid.