We hear many commentators opine that governments should not 'redistribute' wealth from the rich to the poor. According to them, this kind of redistribution is what socialism is all about. I say: 'really'?
NFL takes money from rich team and gives the funds to the poorer teams. So does NHL and MLB, and almost all corporations. GE transfers money from more profitable subsidiaries to less profitable ones every day. Critics would say that corporations can do so as it is 'their money'. It is actually the shareholders' money.
If individuals redistribute funds and have no resources they may ask for a loan. And when that happens they engage yet another set of redistributive processes (where do financial institutions get their money if not from savers or from almighty Fed?).
When you save money to buy a car, a house, or a boat you actually redistribute money from present potential expenditures to future expenditures. When you give lunch money to your child you actually redistribute money from somebody -you- who has money to somebody who does not -your child-, for very legitimate -and moral and noble- reasons.
We are redistributing money every time when we engage in financial transactions. Why should the government not protect the interests of all of us by harnessing the power of redistribution? We, after all, can choose to move to another country with less public redistribution or we can elect representatives who support the notion that private redistribution is more effective than public redistribution. But maybe it is not that simple.
Given the 2007 private banking generated crisis we could successfully argue that the government is the only institution with authority, durability, and credibility to preserve the value of private redistribution over the long term. So, I say, public redistribution is actually more desirable over private redistributive processes, at least on large and public scales.
Long live public redistribution, I say. Private redistribution will always thrive, no matter what the government does, so it can fend for itself just fine.
Thursday, September 27, 2012
Tuesday, August 21, 2012
Tony Scott And Rational Decisions
Tony Scott committed suicide a few days ago. He was 68. He was a rather successful movies director and many people will remember his movies forever. I will always remember Top Gun with Tom Cruise.
His suicide is debated by the media and across the blogosphere and some of us wonder whether committing suicide can ever be justified, mostly when you reach a certain age, status, wealth, family, and prestige. I am of the belief that committing suicide can be fully rational under some circumstances regardless of status and age.
Getting old is psychologically painful enough when you are healthy but imagine getting old while you are ill must be exponentially worse. Imagine then that you would have to budget for medical expenses and prescriptions and all you have worked for is just a distant memory. Why would you want to get much older past a certain age?
Everything you stand for is behind you and it feels like hiking up a mountain where the views around you get wider and wider and the details get less and less important. So, when you become old, living day by day gets more and more painful as there are more and more details that you lose. Perspective wins and daily details become pure repetition.
Many retirement planners and tools would tell you to plan to live 40 or 50 years after retirement date but the truth is that you can control precisely how long you are going to live past any arbitrary date. So, why would you plan for something unknown when you can plan for something known and as clear as the law of gravitation?
His suicide is debated by the media and across the blogosphere and some of us wonder whether committing suicide can ever be justified, mostly when you reach a certain age, status, wealth, family, and prestige. I am of the belief that committing suicide can be fully rational under some circumstances regardless of status and age.
Getting old is psychologically painful enough when you are healthy but imagine getting old while you are ill must be exponentially worse. Imagine then that you would have to budget for medical expenses and prescriptions and all you have worked for is just a distant memory. Why would you want to get much older past a certain age?
Everything you stand for is behind you and it feels like hiking up a mountain where the views around you get wider and wider and the details get less and less important. So, when you become old, living day by day gets more and more painful as there are more and more details that you lose. Perspective wins and daily details become pure repetition.
Many retirement planners and tools would tell you to plan to live 40 or 50 years after retirement date but the truth is that you can control precisely how long you are going to live past any arbitrary date. So, why would you plan for something unknown when you can plan for something known and as clear as the law of gravitation?
Monday, July 30, 2012
I Pee on 2012 NBC Olympics Coverage, Again, and Again...
When I watch Bob Costas on the 2012 NBC Olympics coverage I get angry. When I get angry I go learn how to piss long distance. When I master long distance pissing I pee on NBC from very far away. Sayonara, suckers!
Stop the Fed 's Hegemony (Political Moral Hazard)
The Federal Reserve continues to believe that low interest rates will make people behave as if the 2007 Crisis and its aftermath have never happened. How can it be that individuals want a 'time-out' and the Fed wants people to not have any 'time-outs'?
Time-outs are perfectly rational and what the Fed is doing is totally irrational. The Fed seems to think that people have lost their way in this economy while it is just the opposite: the Fed has lost their compass.
The Fed's stock of credibility is at stake and should the Fed continue to think that under severe economic uncertainty people should spend more than they have then the Fed should surely reward them for the 'uncertainty' risk and not punish them for being savers. This punishing attitude of the Fed will haunt the Federal Reserve for a very long time and people will not believe that the Fed has savers' interests at heart. The Fed is interested in big things and not 'unary' individuals. Apparently, we, as individuals, do not exist for the Federal Reserve.
Whatever the Fed does is to protect the financial sector and to protect itself from the government. Hence, the Fed is just like the Federal government but without true political constraints/consequences. The Federal Reserve can 'spend' as much as it wants for as long as it chooses as long as the financial markets believe them. Financial markets have been wrong many times in the past and should the markets be wrong again a game of chicken will quickly ensue.
The Fed behaves like a hegemony and demands that people act according to some economic models that do not exist. They are a government within the government and should people refuse to obey their 'orders' to spend then rational individuals are doomed and will continue to be punished. Why?
The Fed seems to not be able to comprehend that economic agents have lost faith in institutions. People cannot afford to take on debts at institutions that will always be backed up by the government while individuals will be left 'holding the bag' after the fact. People will be punished through 3 diverse mechanisms: inflation, taxation, and misrepresentation.
The money that the Fed is printing will have to show up, at some point, in higher inflation. History does not lie about that.
The government is borrowing money at very low costs and at some point the US government will have to pay the money back. Where do you think the money will come from? Economic growth? If economic growth alone could pay off all the government debt then the 2007 Crisis would not have happened.
Misrepresentation happens when we elect people to, say, cut taxes, and they cannot possibly do that. Misrepresentation has many causes, but the Fed is one of the most important accessories to misrepresentation by 'quantitative easing' and pursuing a policy of cheap money.
Consequently, by promoting -and perhaps praying for- inflation, taxation, and misrepresentation the Fed is political, in spite of the fact that they pretend otherwise. We are past the fifth grade on how the Fed operates.
Mr. Bernanke, take down this charade and pay the true savers their fair share. Make the economy depend on individual capital and not 'quantitative' easing. For how long are you going to be able to borrow money from future growth? 3 years? 10 years? By that time the Fed will be holding more Treasury bonds than any other government or financial institution in the world. We are in the 5th year of the 2007 Crisis and the end of the crisis is nowhere in sight. The degree of economic uncertainty has not decreased by much since 2007.
So, then, what will happen should the US government enter bankruptcy?
Time-outs are perfectly rational and what the Fed is doing is totally irrational. The Fed seems to think that people have lost their way in this economy while it is just the opposite: the Fed has lost their compass.
The Fed's stock of credibility is at stake and should the Fed continue to think that under severe economic uncertainty people should spend more than they have then the Fed should surely reward them for the 'uncertainty' risk and not punish them for being savers. This punishing attitude of the Fed will haunt the Federal Reserve for a very long time and people will not believe that the Fed has savers' interests at heart. The Fed is interested in big things and not 'unary' individuals. Apparently, we, as individuals, do not exist for the Federal Reserve.
Whatever the Fed does is to protect the financial sector and to protect itself from the government. Hence, the Fed is just like the Federal government but without true political constraints/consequences. The Federal Reserve can 'spend' as much as it wants for as long as it chooses as long as the financial markets believe them. Financial markets have been wrong many times in the past and should the markets be wrong again a game of chicken will quickly ensue.
The Fed behaves like a hegemony and demands that people act according to some economic models that do not exist. They are a government within the government and should people refuse to obey their 'orders' to spend then rational individuals are doomed and will continue to be punished. Why?
The Fed seems to not be able to comprehend that economic agents have lost faith in institutions. People cannot afford to take on debts at institutions that will always be backed up by the government while individuals will be left 'holding the bag' after the fact. People will be punished through 3 diverse mechanisms: inflation, taxation, and misrepresentation.
The money that the Fed is printing will have to show up, at some point, in higher inflation. History does not lie about that.
The government is borrowing money at very low costs and at some point the US government will have to pay the money back. Where do you think the money will come from? Economic growth? If economic growth alone could pay off all the government debt then the 2007 Crisis would not have happened.
Misrepresentation happens when we elect people to, say, cut taxes, and they cannot possibly do that. Misrepresentation has many causes, but the Fed is one of the most important accessories to misrepresentation by 'quantitative easing' and pursuing a policy of cheap money.
Consequently, by promoting -and perhaps praying for- inflation, taxation, and misrepresentation the Fed is political, in spite of the fact that they pretend otherwise. We are past the fifth grade on how the Fed operates.
Mr. Bernanke, take down this charade and pay the true savers their fair share. Make the economy depend on individual capital and not 'quantitative' easing. For how long are you going to be able to borrow money from future growth? 3 years? 10 years? By that time the Fed will be holding more Treasury bonds than any other government or financial institution in the world. We are in the 5th year of the 2007 Crisis and the end of the crisis is nowhere in sight. The degree of economic uncertainty has not decreased by much since 2007.
So, then, what will happen should the US government enter bankruptcy?
Tuesday, July 24, 2012
Aurora Shooting
A few days ago a guy with pretty high IQ opened up gun fire in a theater in Aurora, CO. He killed 12 innocent individuals -including children- and injured about 58.
Apparently, he purchased all the guns and ammunition perfectly legally and all 2nd aendment supporters think that there is nothing wrong with that. Nothing. Nada. The perpetrator is 100% responsible and nothing else needs to be 'fixed'.
Can you believe that?
These types of shootings, when innocent people get killed by other individuals who elect to exercise their 2nd amendment rights to the detriment of all others who elect not to, happen almost daily. Over the last few decades more than 1 million people were killed by law abiding citizens taking full advantage of the 2nd amendment and we are to believe that the law is constitutional.
Is it the intent of the constitution to allow the killing of innocent people from time to time? I do not think so, but no matter how many arguments are being brought up they do no stick and they will never stick.
We like to gamble with our own lives as this could happen to each one of us at any given time. And all this is perfectly legit. Astounding.
Apparently, he purchased all the guns and ammunition perfectly legally and all 2nd aendment supporters think that there is nothing wrong with that. Nothing. Nada. The perpetrator is 100% responsible and nothing else needs to be 'fixed'.
Can you believe that?
These types of shootings, when innocent people get killed by other individuals who elect to exercise their 2nd amendment rights to the detriment of all others who elect not to, happen almost daily. Over the last few decades more than 1 million people were killed by law abiding citizens taking full advantage of the 2nd amendment and we are to believe that the law is constitutional.
Is it the intent of the constitution to allow the killing of innocent people from time to time? I do not think so, but no matter how many arguments are being brought up they do no stick and they will never stick.
We like to gamble with our own lives as this could happen to each one of us at any given time. And all this is perfectly legit. Astounding.
Friday, July 6, 2012
Euro 2012 Closing Words
Spain won the tournament and the final game with Italy displayed a Spanish team that could have conceivably beaten Italy even if they had played with 20 players on the pitch.
Spain had a great final and any team they would have faced would have lost, no doubt about it. Italy did their best but Spain took a quasi mathematical 'derivative' of the Italian style game and enhanced it with unmatched passing and inspiration. Italians appeared frozen in a different era.
The final was as if Spain was playing in HD and Italy was playing in black and white, in a cathodic tube game. Soccer viewed and played in HD has a new standard that speaks Castillian. No team has managed to come close to within a mile of Spain at this tournament.
Spain is not only the best team in Europe but also the best team in the galaxy. Kudos to them! I was glad to be able to witness a final that demonstrated that soccer is always surprising and inspiring.
Viva Espana!
Spain had a great final and any team they would have faced would have lost, no doubt about it. Italy did their best but Spain took a quasi mathematical 'derivative' of the Italian style game and enhanced it with unmatched passing and inspiration. Italians appeared frozen in a different era.
The final was as if Spain was playing in HD and Italy was playing in black and white, in a cathodic tube game. Soccer viewed and played in HD has a new standard that speaks Castillian. No team has managed to come close to within a mile of Spain at this tournament.
Spain is not only the best team in Europe but also the best team in the galaxy. Kudos to them! I was glad to be able to witness a final that demonstrated that soccer is always surprising and inspiring.
Viva Espana!
Sunday, July 1, 2012
Euro 2012 - Twentieth Day
In Kiev, Italy plays Spain for the championship. This is the last game of an amazing tournament with the Netherlands and Croatia being eliminated in the group stages.
My prediction: Italy will beat Spain and will win it all, to spite all the critics and show that the ball is round all the way to the bank.
Spain has clearly reinvented the beautiful game but Italy has redefined expectations of how the game should be played as opposed to how it is expected to be played.
Italia! Italia! Italia!
Bummer. Spain scored first in the first 15 minutes. Spain scored again. Double bummer. 2-0 at half time.
If Italy comes back in the second half that would be historical. If they do not then Spain would make history. No matter what, this is historical. Is t his a 'catch NOT 22'?
Oh well. Spain has just won the Euro 2012. They were the official favorites to win it all, after all. I am not official, so Spain's win is just fine by me.
In the end Spain beat Italy 4-0. Astonishing score for a European championship.
Arguably, after this win, Spain has become the best team in history.
My prediction: Italy will beat Spain and will win it all, to spite all the critics and show that the ball is round all the way to the bank.
Spain has clearly reinvented the beautiful game but Italy has redefined expectations of how the game should be played as opposed to how it is expected to be played.
Italia! Italia! Italia!
Bummer. Spain scored first in the first 15 minutes. Spain scored again. Double bummer. 2-0 at half time.
If Italy comes back in the second half that would be historical. If they do not then Spain would make history. No matter what, this is historical. Is t his a 'catch NOT 22'?
Oh well. Spain has just won the Euro 2012. They were the official favorites to win it all, after all. I am not official, so Spain's win is just fine by me.
In the end Spain beat Italy 4-0. Astonishing score for a European championship.
Arguably, after this win, Spain has become the best team in history.
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