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	<title>Comments on: Way Too Big To Save</title>
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	<link>http://baselinescenario.com/2010/03/09/way-too-big-to-save/</link>
	<description>What happened to the global economy and what we can do about it</description>
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		<title>By: Ted Kaminski</title>
		<link>http://baselinescenario.com/2010/03/09/way-too-big-to-save/#comment-46469</link>
		<dc:creator><![CDATA[Ted Kaminski]]></dc:creator>
		<pubDate>Sat, 13 Mar 2010 16:26:23 +0000</pubDate>
		<guid isPermaLink="false">http://baselinescenario.com/?p=6723#comment-46469</guid>
		<description><![CDATA[Actually the article cuts the ground out from under the Bush tax cuts which increased our debt prior to an economic shock.]]></description>
		<content:encoded><![CDATA[<p>Actually the article cuts the ground out from under the Bush tax cuts which increased our debt prior to an economic shock.</p>
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		<title>By: Ted Kaminski</title>
		<link>http://baselinescenario.com/2010/03/09/way-too-big-to-save/#comment-46468</link>
		<dc:creator><![CDATA[Ted Kaminski]]></dc:creator>
		<pubDate>Sat, 13 Mar 2010 16:09:48 +0000</pubDate>
		<guid isPermaLink="false">http://baselinescenario.com/?p=6723#comment-46468</guid>
		<description><![CDATA[I don&#039;t see where either unemployment or depression of the economy have subsided at this time. The inflation hawks should stay sleeping in their nests.]]></description>
		<content:encoded><![CDATA[<p>I don&#8217;t see where either unemployment or depression of the economy have subsided at this time. The inflation hawks should stay sleeping in their nests.</p>
]]></content:encoded>
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		<title>By: xinyue444</title>
		<link>http://baselinescenario.com/2010/03/09/way-too-big-to-save/#comment-46447</link>
		<dc:creator><![CDATA[xinyue444]]></dc:creator>
		<pubDate>Sat, 13 Mar 2010 02:55:53 +0000</pubDate>
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		<content:encoded><![CDATA[<p>Air jordan(1-24)shoes $33</p>
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	<item>
		<title>By: Far-fetched Not Any More</title>
		<link>http://baselinescenario.com/2010/03/09/way-too-big-to-save/#comment-46287</link>
		<dc:creator><![CDATA[Far-fetched Not Any More]]></dc:creator>
		<pubDate>Thu, 11 Mar 2010 16:16:52 +0000</pubDate>
		<guid isPermaLink="false">http://baselinescenario.com/?p=6723#comment-46287</guid>
		<description><![CDATA[If not seeking prayer, than folks need to bring logic of what is true and has stood the times of so many generations of change... 

Times of Classical and Contemporary Virtue Theories:

Plato (c.428-347 B.C.) Aristotle (384-322 B.C.) are good places to start in what makes the character of foundational change...

“All the gold which is under or upon the earth is not enough to give in exchange for virtue” (Plato). 

“All men are by nature equal, made all the same earth by one Workman; and however we deceive ourselves, as dear unto God is poor peasant as the mighty prince” (Plato). 

“We are what we repeatedly do. Excellence, then, is not an act, but a habit” (Aristotle). 

“What lies in our power to do, lies in our power not to do” (Aristotle). 

“It is possible to fail in many ways…while to succeed is possible only in one way” (Aristotle).

When you bring in the world of skeptics and others who would challenge creation over evolution, you find that so many occurrences of logic has also confirmed the existence of a Living God that refute the existence... 

I am one that did not right these famous words uttered throughout the centuries. But logic to come to bring action is brought about by passion of ones soul to achieve greater things in the service of his or her fellow man. 

The logic is simple; Occam&#039;s Razor was known for simplicity. His challenge was to intellectually challenge the very nature of faith. 

The challenge you are asking for, is for people to make solutions and resolve problems. 

This is done my friend by the very nature of the call to rise and bring the voice and ability for a world reeling with uncertainty, and struggling with the very nature of moral and ethical loss of what is to keep a social order. 

This occurs when you try to make God absent from the equation. 

Add the God factor and the desire of, &quot;Knock and it will be open, Ask and it will be granted unto thee&quot;, holds true if the prayer is truly offered by inviting Gods Will to intervene.

It does get mind blowing when the absolute challenge that stems greed, consumption, and lack of social order that broke eventually the society and the Roman Emperor. 

This is the signal today sent by many countries challenged with debt by accursed leverage and derivatives sold by the concerns such as Goldman Sachs and other Market Makers. 

The sorry statement in all this dialect; is the eventual collapse and fall of our modern society can happen over and over again, if the lessons are not learned... 

Call this, our modern colleges of teaching theory as I have had the pleasure over these past years attending...   

Keeping with the season... For those who do pray and know works and prayers are the ultimate answer... Enjoy!

[youtube=http://www.youtube.com/watch?v=DfS4vXSS-IQ&amp;hl=en_US&amp;fs=1&amp;color1=0x234900&amp;color2=0x4e9e00]

Far-fetched, Not Anymore!
James Gornick]]></description>
		<content:encoded><![CDATA[<p>If not seeking prayer, than folks need to bring logic of what is true and has stood the times of so many generations of change&#8230; </p>
<p>Times of Classical and Contemporary Virtue Theories:</p>
<p>Plato (c.428-347 B.C.) Aristotle (384-322 B.C.) are good places to start in what makes the character of foundational change&#8230;</p>
<p>“All the gold which is under or upon the earth is not enough to give in exchange for virtue” (Plato). </p>
<p>“All men are by nature equal, made all the same earth by one Workman; and however we deceive ourselves, as dear unto God is poor peasant as the mighty prince” (Plato). </p>
<p>“We are what we repeatedly do. Excellence, then, is not an act, but a habit” (Aristotle). </p>
<p>“What lies in our power to do, lies in our power not to do” (Aristotle). </p>
<p>“It is possible to fail in many ways…while to succeed is possible only in one way” (Aristotle).</p>
<p>When you bring in the world of skeptics and others who would challenge creation over evolution, you find that so many occurrences of logic has also confirmed the existence of a Living God that refute the existence&#8230; </p>
<p>I am one that did not right these famous words uttered throughout the centuries. But logic to come to bring action is brought about by passion of ones soul to achieve greater things in the service of his or her fellow man. </p>
<p>The logic is simple; Occam&#8217;s Razor was known for simplicity. His challenge was to intellectually challenge the very nature of faith. </p>
<p>The challenge you are asking for, is for people to make solutions and resolve problems. </p>
<p>This is done my friend by the very nature of the call to rise and bring the voice and ability for a world reeling with uncertainty, and struggling with the very nature of moral and ethical loss of what is to keep a social order. </p>
<p>This occurs when you try to make God absent from the equation. </p>
<p>Add the God factor and the desire of, &#8220;Knock and it will be open, Ask and it will be granted unto thee&#8221;, holds true if the prayer is truly offered by inviting Gods Will to intervene.</p>
<p>It does get mind blowing when the absolute challenge that stems greed, consumption, and lack of social order that broke eventually the society and the Roman Emperor. </p>
<p>This is the signal today sent by many countries challenged with debt by accursed leverage and derivatives sold by the concerns such as Goldman Sachs and other Market Makers. </p>
<p>The sorry statement in all this dialect; is the eventual collapse and fall of our modern society can happen over and over again, if the lessons are not learned&#8230; </p>
<p>Call this, our modern colleges of teaching theory as I have had the pleasure over these past years attending&#8230;   </p>
<p>Keeping with the season&#8230; For those who do pray and know works and prayers are the ultimate answer&#8230; Enjoy!</p>
<p><span style="text-align:center; display: block;"><a href="http://baselinescenario.com/2010/03/09/way-too-big-to-save/"><img src="http://img.youtube.com/vi/DfS4vXSS-IQ/2.jpg" alt="" /></a></span></p>
<p>Far-fetched, Not Anymore!<br />
James Gornick</p>
]]></content:encoded>
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	<item>
		<title>By: 3-D</title>
		<link>http://baselinescenario.com/2010/03/09/way-too-big-to-save/#comment-46260</link>
		<dc:creator><![CDATA[3-D]]></dc:creator>
		<pubDate>Thu, 11 Mar 2010 06:00:54 +0000</pubDate>
		<guid isPermaLink="false">http://baselinescenario.com/?p=6723#comment-46260</guid>
		<description><![CDATA[You got through writing that entire wall of text without putting together a single logical thought or saying anything substantive at all. Quite typical when Jesus Speak gets rolling. I&#039;m not going to debate the truth of the Bible or the existence of God as stated in it. Even if he DOES exist (and the easier explanation by Occam&#039;s Razor is that he doesn&#039;t), he allowed all this to happen already, so obviously appealing to him is a waste of time even if you believe in him. He clearly doesn&#039;t care.

What I will debate is how useless the &quot;Use prayer!&quot; line of &quot;helping&quot; is. At best, it&#039;s just a waste of time. At worst, it&#039;s an excuse for apathy after claiming &quot;Well I&#039;ve put it in God&#039;s hands, so it&#039;s all gonna work out now and I don&#039;t have to think about it!&quot;

How about instead of suggesting people get on their knees and start begging your invisible man for help, you encourage people to get off their knees (and butts) and start making things happen? What we need right now isn&#039;t prayer, wishful thinking, and platitudes as doled out by the local religion. We need actual people giving actual thought towards solving actual problems instead of assuming an ancient book (which repeatedly contradicts itself in an orgy of tragically flawed logic) has already foretold that imaginary mystical forces will fix a REAL problem for us if we just trust them. 

Apologies to the other posters if I seem to be ranting, but this drivel is just... mind blowing.]]></description>
		<content:encoded><![CDATA[<p>You got through writing that entire wall of text without putting together a single logical thought or saying anything substantive at all. Quite typical when Jesus Speak gets rolling. I&#8217;m not going to debate the truth of the Bible or the existence of God as stated in it. Even if he DOES exist (and the easier explanation by Occam&#8217;s Razor is that he doesn&#8217;t), he allowed all this to happen already, so obviously appealing to him is a waste of time even if you believe in him. He clearly doesn&#8217;t care.</p>
<p>What I will debate is how useless the &#8220;Use prayer!&#8221; line of &#8220;helping&#8221; is. At best, it&#8217;s just a waste of time. At worst, it&#8217;s an excuse for apathy after claiming &#8220;Well I&#8217;ve put it in God&#8217;s hands, so it&#8217;s all gonna work out now and I don&#8217;t have to think about it!&#8221;</p>
<p>How about instead of suggesting people get on their knees and start begging your invisible man for help, you encourage people to get off their knees (and butts) and start making things happen? What we need right now isn&#8217;t prayer, wishful thinking, and platitudes as doled out by the local religion. We need actual people giving actual thought towards solving actual problems instead of assuming an ancient book (which repeatedly contradicts itself in an orgy of tragically flawed logic) has already foretold that imaginary mystical forces will fix a REAL problem for us if we just trust them. </p>
<p>Apologies to the other posters if I seem to be ranting, but this drivel is just&#8230; mind blowing.</p>
]]></content:encoded>
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		<title>By: JS</title>
		<link>http://baselinescenario.com/2010/03/09/way-too-big-to-save/#comment-46254</link>
		<dc:creator><![CDATA[JS]]></dc:creator>
		<pubDate>Thu, 11 Mar 2010 05:09:17 +0000</pubDate>
		<guid isPermaLink="false">http://baselinescenario.com/?p=6723#comment-46254</guid>
		<description><![CDATA[Wow! That sounds like a Ponzi scheme. And you think investors will be comfortable with that forever? I noticed in prior posts, you hedged on this theory.  Is Johson&#039;s statement that deficits do matter conflict with it, or just seems to?
Somewhere I read we have to borrow several billion a day, but I also read that China is not growing its stockpile of U.S. debt. Wonder who is picking it up?]]></description>
		<content:encoded><![CDATA[<p>Wow! That sounds like a Ponzi scheme. And you think investors will be comfortable with that forever? I noticed in prior posts, you hedged on this theory.  Is Johson&#8217;s statement that deficits do matter conflict with it, or just seems to?<br />
Somewhere I read we have to borrow several billion a day, but I also read that China is not growing its stockpile of U.S. debt. Wonder who is picking it up?</p>
]]></content:encoded>
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	<item>
		<title>By: James Gornick</title>
		<link>http://baselinescenario.com/2010/03/09/way-too-big-to-save/#comment-46232</link>
		<dc:creator><![CDATA[James Gornick]]></dc:creator>
		<pubDate>Thu, 11 Mar 2010 02:28:59 +0000</pubDate>
		<guid isPermaLink="false">http://baselinescenario.com/?p=6723#comment-46232</guid>
		<description><![CDATA[3-D:

First, it&#039;s a foregone conclusion that politics and religion are hot seats for many to enter a discussion. 

The similarities, as you eluded to, are only the same in one reflection. This reflection is the, &quot;petition somebody more powerful than you to help you out&quot;(3-D).

The certain difference between the presence of God or to question the lack of presence is the more critical view you have raised. 

In comparisons of God and the existence of honest politician(s) was far-reaching in the context we have no hope. Hope is the key word in this message. 

The hope and prayers of are forefathers in placing their faith in the One Living God. In a God Who We Trust was the line drawn in the sand for the whole world to come to know. To know that this sovereign nation is led by the spirit of Gods social order of principles from the beginning of time. 

This is where the politician is somewhat separated from the comparison you gave.  

Man and/or woman who are given the privilege and called to serve at the election of their fellow men and women. These elected given the privilege to serve, have the moral and ethical call to do the right things. 

Your comments can ring true; many fall away from the path of what is right and choose wrong when given power. 

This is where your comments also move toward apathy, and forgetting the ultimate ending has already been told in the final chapters of the &quot;Greatest Book Ever Written&quot;, this if you believe in the One Living God.  

Many a politician has found their ruins to follow the deceptions and deceit of falling to the temptations of the 7 Grave Sins of Man. 

There are many good men and women that stand for the rights and moral codes and principles of life. 

The list would be long throughout our great nations history; of these men and women who have answered this call to serve. 

The problem now seems a select few have decided to push the &quot;One World Order&quot; through the assemble of &quot;The BuliderBerg Group&quot; and the &quot;Tri-Lateral Commission&quot;, on the back of oppressing many to become captive by the very nature of the fall of keeping a social order. To run with power to think they will control the choices of a nation under God. 

The call sounded now is for the ones to hear &quot;Gods Will&quot; for keeping a true social order. Social order based upon the principals of &quot;I am&quot;. You can ask me another day who &quot;I am&quot; happens to be... 

I happen to be a God fearing Man that will stay on his knees and continue to pray and serve and answer the call. Many proud Marines and all that have served in the armed forces and our nation know this honor of God and Country well... 

Far-fetched, Not Anymore!
James Gornick]]></description>
		<content:encoded><![CDATA[<p>3-D:</p>
<p>First, it&#8217;s a foregone conclusion that politics and religion are hot seats for many to enter a discussion. </p>
<p>The similarities, as you eluded to, are only the same in one reflection. This reflection is the, &#8220;petition somebody more powerful than you to help you out&#8221;(3-D).</p>
<p>The certain difference between the presence of God or to question the lack of presence is the more critical view you have raised. </p>
<p>In comparisons of God and the existence of honest politician(s) was far-reaching in the context we have no hope. Hope is the key word in this message. </p>
<p>The hope and prayers of are forefathers in placing their faith in the One Living God. In a God Who We Trust was the line drawn in the sand for the whole world to come to know. To know that this sovereign nation is led by the spirit of Gods social order of principles from the beginning of time. </p>
<p>This is where the politician is somewhat separated from the comparison you gave.  </p>
<p>Man and/or woman who are given the privilege and called to serve at the election of their fellow men and women. These elected given the privilege to serve, have the moral and ethical call to do the right things. </p>
<p>Your comments can ring true; many fall away from the path of what is right and choose wrong when given power. </p>
<p>This is where your comments also move toward apathy, and forgetting the ultimate ending has already been told in the final chapters of the &#8220;Greatest Book Ever Written&#8221;, this if you believe in the One Living God.  </p>
<p>Many a politician has found their ruins to follow the deceptions and deceit of falling to the temptations of the 7 Grave Sins of Man. </p>
<p>There are many good men and women that stand for the rights and moral codes and principles of life. </p>
<p>The list would be long throughout our great nations history; of these men and women who have answered this call to serve. </p>
<p>The problem now seems a select few have decided to push the &#8220;One World Order&#8221; through the assemble of &#8220;The BuliderBerg Group&#8221; and the &#8220;Tri-Lateral Commission&#8221;, on the back of oppressing many to become captive by the very nature of the fall of keeping a social order. To run with power to think they will control the choices of a nation under God. </p>
<p>The call sounded now is for the ones to hear &#8220;Gods Will&#8221; for keeping a true social order. Social order based upon the principals of &#8220;I am&#8221;. You can ask me another day who &#8220;I am&#8221; happens to be&#8230; </p>
<p>I happen to be a God fearing Man that will stay on his knees and continue to pray and serve and answer the call. Many proud Marines and all that have served in the armed forces and our nation know this honor of God and Country well&#8230; </p>
<p>Far-fetched, Not Anymore!<br />
James Gornick</p>
]]></content:encoded>
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	<item>
		<title>By: Beezer</title>
		<link>http://baselinescenario.com/2010/03/09/way-too-big-to-save/#comment-46190</link>
		<dc:creator><![CDATA[Beezer]]></dc:creator>
		<pubDate>Wed, 10 Mar 2010 19:23:42 +0000</pubDate>
		<guid isPermaLink="false">http://baselinescenario.com/?p=6723#comment-46190</guid>
		<description><![CDATA[oops, waist, not waste.]]></description>
		<content:encoded><![CDATA[<p>oops, waist, not waste.</p>
]]></content:encoded>
	</item>
	<item>
		<title>By: Beezer</title>
		<link>http://baselinescenario.com/2010/03/09/way-too-big-to-save/#comment-46189</link>
		<dc:creator><![CDATA[Beezer]]></dc:creator>
		<pubDate>Wed, 10 Mar 2010 19:22:11 +0000</pubDate>
		<guid isPermaLink="false">http://baselinescenario.com/?p=6723#comment-46189</guid>
		<description><![CDATA[My opinion is that strong economies occur for reasons other than tax rates.  Both tax cuts and periods of progressive tax rates, seem to be more or less the same in their correlation to strong job and income growth.

They diverge on correlation with deficits.  Tax cuts strongly correlate with growing deficits. 

Therefore I think we&#039;re watching the wrong ball(s) for understanding what is really going on.  Strong job and income growth seem to be triggered by very large changes.  Game changing innovation for one example.  Population growth for another.  

Another historically strong driver is government.  Governments occasionally decide to back one reform or another aimed at boosting one or more industries.

We subsidize corn and get cheap meat.  It may be toxic as Hell, but it&#039;s cheap.  We built an interstate highway system and auto sales boomed.  We subsidize the pharma and medical device industries through academic (primarily) pure research.  That&#039;s worked pretty well, but not without several serious &quot;bad&quot; unintended consequences.

We subsidize Wall Street.  It sure has grown, hasn&#039;t it?

That we don&#039;t instead subsidize organic food, clean energy and universal health care is a crying shame.  But there&#039;s no questioning that government can be a huge driver of growth.

Our stagnation today is due to the philosophy that government can&#039;t boost economies.  That&#039;s a relatively recent ideology and can only be believed if one first tosses out the window more than a century of American history.

As for the tea baggers (partiers?) may I propose a solidarity greeting they can use?  Bend over from the waste and grab your ankles.  

Their flag?  &quot;Don&#039;t Tread On My Stockholm Syndrome.&quot;]]></description>
		<content:encoded><![CDATA[<p>My opinion is that strong economies occur for reasons other than tax rates.  Both tax cuts and periods of progressive tax rates, seem to be more or less the same in their correlation to strong job and income growth.</p>
<p>They diverge on correlation with deficits.  Tax cuts strongly correlate with growing deficits. </p>
<p>Therefore I think we&#8217;re watching the wrong ball(s) for understanding what is really going on.  Strong job and income growth seem to be triggered by very large changes.  Game changing innovation for one example.  Population growth for another.  </p>
<p>Another historically strong driver is government.  Governments occasionally decide to back one reform or another aimed at boosting one or more industries.</p>
<p>We subsidize corn and get cheap meat.  It may be toxic as Hell, but it&#8217;s cheap.  We built an interstate highway system and auto sales boomed.  We subsidize the pharma and medical device industries through academic (primarily) pure research.  That&#8217;s worked pretty well, but not without several serious &#8220;bad&#8221; unintended consequences.</p>
<p>We subsidize Wall Street.  It sure has grown, hasn&#8217;t it?</p>
<p>That we don&#8217;t instead subsidize organic food, clean energy and universal health care is a crying shame.  But there&#8217;s no questioning that government can be a huge driver of growth.</p>
<p>Our stagnation today is due to the philosophy that government can&#8217;t boost economies.  That&#8217;s a relatively recent ideology and can only be believed if one first tosses out the window more than a century of American history.</p>
<p>As for the tea baggers (partiers?) may I propose a solidarity greeting they can use?  Bend over from the waste and grab your ankles.  </p>
<p>Their flag?  &#8220;Don&#8217;t Tread On My Stockholm Syndrome.&#8221;</p>
]]></content:encoded>
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	<item>
		<title>By: NKlein1553</title>
		<link>http://baselinescenario.com/2010/03/09/way-too-big-to-save/#comment-46156</link>
		<dc:creator><![CDATA[NKlein1553]]></dc:creator>
		<pubDate>Wed, 10 Mar 2010 14:36:55 +0000</pubDate>
		<guid isPermaLink="false">http://baselinescenario.com/?p=6723#comment-46156</guid>
		<description><![CDATA[Thank you.  When evaluating a given U.S. federal budget position you should always keep two things in mind: the productive potential of the U.S. economy and the price level.

There are any number of metrics used to gauge the price level, but some of the most common are:

Government statistics:

1) The CPI
2) &quot;Core,&quot; inflation
3) Median or trimmed inflation

Market based indicators:

1) Long-term (10 year and out) bond yields
2) TIPS spreads
3) The CPI futures market

Different economists use different measures for different purposes so there are actually many, many more metrics than I&#039;ve mentioned here.  I&#039;m sure someone more knowledgeable than me could add to this list if they were so inclined.


Estimating the productive potential of the U.S. economy is rather more difficult and controversial than measuring the price level, but here are some possible proxies:

1) The unemployment and underemployment rates
2) Capacity utilization rates
3) Business inventories
4) Trend GDP growth rates

That&#039;s all I can think of off the top of my head.  My advice is to never listen to anyone who talks about debt/GDP ratios without also mentioning at least some of the metrics presented here.  Nothing occurs in a vacuum, anyone who tries to tell you differently is trying to sell you something.]]></description>
		<content:encoded><![CDATA[<p>Thank you.  When evaluating a given U.S. federal budget position you should always keep two things in mind: the productive potential of the U.S. economy and the price level.</p>
<p>There are any number of metrics used to gauge the price level, but some of the most common are:</p>
<p>Government statistics:</p>
<p>1) The CPI<br />
2) &#8220;Core,&#8221; inflation<br />
3) Median or trimmed inflation</p>
<p>Market based indicators:</p>
<p>1) Long-term (10 year and out) bond yields<br />
2) TIPS spreads<br />
3) The CPI futures market</p>
<p>Different economists use different measures for different purposes so there are actually many, many more metrics than I&#8217;ve mentioned here.  I&#8217;m sure someone more knowledgeable than me could add to this list if they were so inclined.</p>
<p>Estimating the productive potential of the U.S. economy is rather more difficult and controversial than measuring the price level, but here are some possible proxies:</p>
<p>1) The unemployment and underemployment rates<br />
2) Capacity utilization rates<br />
3) Business inventories<br />
4) Trend GDP growth rates</p>
<p>That&#8217;s all I can think of off the top of my head.  My advice is to never listen to anyone who talks about debt/GDP ratios without also mentioning at least some of the metrics presented here.  Nothing occurs in a vacuum, anyone who tries to tell you differently is trying to sell you something.</p>
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		<title>By: AJ</title>
		<link>http://baselinescenario.com/2010/03/09/way-too-big-to-save/#comment-46149</link>
		<dc:creator><![CDATA[AJ]]></dc:creator>
		<pubDate>Wed, 10 Mar 2010 13:08:21 +0000</pubDate>
		<guid isPermaLink="false">http://baselinescenario.com/?p=6723#comment-46149</guid>
		<description><![CDATA[Well in that case, of course growth (and inflation) can close the gap on it&#039;s own.]]></description>
		<content:encoded><![CDATA[<p>Well in that case, of course growth (and inflation) can close the gap on it&#8217;s own.</p>
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		<title>By: Min</title>
		<link>http://baselinescenario.com/2010/03/09/way-too-big-to-save/#comment-46145</link>
		<dc:creator><![CDATA[Min]]></dc:creator>
		<pubDate>Wed, 10 Mar 2010 09:50:30 +0000</pubDate>
		<guid isPermaLink="false">http://baselinescenario.com/?p=6723#comment-46145</guid>
		<description><![CDATA[At least, we don&#039;t have a significant level of debt in anything but dollars. :)]]></description>
		<content:encoded><![CDATA[<p>At least, we don&#8217;t have a significant level of debt in anything but dollars. :)</p>
]]></content:encoded>
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		<title>By: Min</title>
		<link>http://baselinescenario.com/2010/03/09/way-too-big-to-save/#comment-46144</link>
		<dc:creator><![CDATA[Min]]></dc:creator>
		<pubDate>Wed, 10 Mar 2010 09:46:28 +0000</pubDate>
		<guid isPermaLink="false">http://baselinescenario.com/?p=6723#comment-46144</guid>
		<description><![CDATA[Since you collect 0 at both a 0% tax rate and a 100% tax rate, and you do not collect negative taxes, there must be an intermediate tax rate where you collect the maximum amount of revenue. If that amount is greater than 0, there must be a tax rate such that increasing it will reduce revenue, and decreasing it will increase revenue. 

But where is it? ;)]]></description>
		<content:encoded><![CDATA[<p>Since you collect 0 at both a 0% tax rate and a 100% tax rate, and you do not collect negative taxes, there must be an intermediate tax rate where you collect the maximum amount of revenue. If that amount is greater than 0, there must be a tax rate such that increasing it will reduce revenue, and decreasing it will increase revenue. </p>
<p>But where is it? ;)</p>
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		<title>By: Min</title>
		<link>http://baselinescenario.com/2010/03/09/way-too-big-to-save/#comment-46143</link>
		<dc:creator><![CDATA[Min]]></dc:creator>
		<pubDate>Wed, 10 Mar 2010 09:36:19 +0000</pubDate>
		<guid isPermaLink="false">http://baselinescenario.com/?p=6723#comment-46143</guid>
		<description><![CDATA[JS: &quot;Seems that, eventually, the money for spending has to come from somewhere other than borrowing.&quot;

It ought to. Unfortunately, the way we have set things up in the U. S., that is, in effect, where it comes from. The government is the ultimate source of our money, including the taxes it receives. It does not create money by printing it, but by spending. But then it borrows, so that the numbers come out the same as if it spent what it borrows or received in taxes. So, in effect, money is created by borrowing, in a way that is analogous to how bank money is created by borrowing. 

That is not the whole story, because the Fed has been delegated the authority to spend money without borrowing. That is something that the Fed avoids doing, unless it is necessary. 

The U. S. has not paid off the national debt since 1836. (And there was a depression in 1837!) Given that, the proposition that we have to pay off current spending by future taxes is dubious. We have not done so for 174 years. Why start now? 

In the modern era, IIUC, the effective tax rate has been fairly stable, at around 20%. So taxes seem to depend more on current income than on past expenditure. 

Now, if we had debts to pay off in gold or some other currency, things could get nasty. But fortunately, we don&#039;t. :)]]></description>
		<content:encoded><![CDATA[<p>JS: &#8220;Seems that, eventually, the money for spending has to come from somewhere other than borrowing.&#8221;</p>
<p>It ought to. Unfortunately, the way we have set things up in the U. S., that is, in effect, where it comes from. The government is the ultimate source of our money, including the taxes it receives. It does not create money by printing it, but by spending. But then it borrows, so that the numbers come out the same as if it spent what it borrows or received in taxes. So, in effect, money is created by borrowing, in a way that is analogous to how bank money is created by borrowing. </p>
<p>That is not the whole story, because the Fed has been delegated the authority to spend money without borrowing. That is something that the Fed avoids doing, unless it is necessary. </p>
<p>The U. S. has not paid off the national debt since 1836. (And there was a depression in 1837!) Given that, the proposition that we have to pay off current spending by future taxes is dubious. We have not done so for 174 years. Why start now? </p>
<p>In the modern era, IIUC, the effective tax rate has been fairly stable, at around 20%. So taxes seem to depend more on current income than on past expenditure. </p>
<p>Now, if we had debts to pay off in gold or some other currency, things could get nasty. But fortunately, we don&#8217;t. :)</p>
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		<title>By: Min</title>
		<link>http://baselinescenario.com/2010/03/09/way-too-big-to-save/#comment-46142</link>
		<dc:creator><![CDATA[Min]]></dc:creator>
		<pubDate>Wed, 10 Mar 2010 09:10:49 +0000</pubDate>
		<guid isPermaLink="false">http://baselinescenario.com/?p=6723#comment-46142</guid>
		<description><![CDATA[AJ: &quot;I don’t think I have ever heard an economist argue that higher spending will pay for itself in higher taxes resulting from the growth.&quot;

I don&#039;t think that&#039;s what I am saying may be a possibility. Rather, it is that even if the spending is paid off by future taxes, that may not necessitate a higher tax rate (which is how laymen interpret the ambiguous term, &quot;higher taxes&quot;).]]></description>
		<content:encoded><![CDATA[<p>AJ: &#8220;I don’t think I have ever heard an economist argue that higher spending will pay for itself in higher taxes resulting from the growth.&#8221;</p>
<p>I don&#8217;t think that&#8217;s what I am saying may be a possibility. Rather, it is that even if the spending is paid off by future taxes, that may not necessitate a higher tax rate (which is how laymen interpret the ambiguous term, &#8220;higher taxes&#8221;).</p>
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