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Comment: Re:Missing the key point (Score 1) 415

by smaddox (#49770411) Attached to: What AI Experts Think About the Existential Risk of AI

And what makes you think that squishing two AI brains would give you twice the intelligence? About the only thing we can reasonably say about a working implementation of general AI is that it must be closer to an animal brain than a silicon processor. Look at sperm whales. Their brains are 5x more massive brains than humans, and yet no one would say they are 5x more intelligent.

Comment: Re:It's fraud and/or Ponzi all the way down (Score 1) 742

by smaddox (#49770007) Attached to: Greece Is Running Out of Money, Cannot Make June IMF Repayment

You cannot borrow money into existence AT ZERO COST and loan it out WITH COMPOUNDING INTEREST into perpetuity without eventually having to deal with the reality that trees don't grow to the sky.

You're missing the forest for the trees. Even without a central bank this would still happen with regular banks. Even with a commodity-backed currency this would still happen with regular banks.

There's nothing inherently wrong with the creation of capital through lending. The problem is that too much leverage results in speculation and Ponzi schemes. The dose makes the poison.

Comment: Re:Great Recession part II? (Score 1) 742

by smaddox (#49769715) Attached to: Greece Is Running Out of Money, Cannot Make June IMF Repayment

I'm not so sure it's different. There are still far too many companies, with advertising as their only source of income, valued at billions of dollars.

You can't buy shares of Dropbox because it has not gone public yet. It will. Almost all of these highly-valued internet companies go public, because they were funded by VC's who expect a large, quick payoff.

Comment: Re: Great Recession part II? (Score 1) 742

by smaddox (#49769653) Attached to: Greece Is Running Out of Money, Cannot Make June IMF Repayment

Without the Fed holding down the interest rates by inflating the currency, rising rates would have limited the pyramiding of debt on debt.

Not when house buyers were being told they could sell their house next year to pay off their zero-down 110% mortgage at a profit. The Fed is not to blame for the predatory lending practices of the giant corporate banks.

The slow and steady rise in Fed-held US treasury securities prior to the crisis was a drop in the bucket compared to the amount of mortgage-backed securities they had to take on to stabilize the housing market.

Comment: Re:it's not "slow and calculated torture" (Score 1) 742

by smaddox (#49769353) Attached to: Greece Is Running Out of Money, Cannot Make June IMF Repayment

Please stop comparing governments to households. It's misleading. Governments are far closer to businesses than they are to households. The rest of your post was spot on.

A household runs a deficit to fulfill personal needs and wants. Businesses and governments run a deficit to finance future production. In a recession, governments have the critical role of countering deflation by either taking on debt or creating central-bank money. Deflation is horrible for an economy because it discourages investment. Greece and the other EU countries naively signed away their ability to create central-bank money when they joined the EU, and thus are left only with taking on debt.

Comment: Re:it's not "slow and calculated torture" (Score 1) 742

by smaddox (#49769247) Attached to: Greece Is Running Out of Money, Cannot Make June IMF Repayment

No nation can roll their debt over indefinitely.

Yes, they can. The absolute level of public debt is not what matters. The debt/GDP ratio is what matters. If raising the public debt 1% raises GDP 5%, then it is in the countries best interest to raise the public debt 1%, and roll over that debt indefinitely.

One can't have an national debt rising infinitely.

As long as GDP is rising faster, yes one can.

One can say what one wants of Germany, but at least they got their budget in order, and they don't structurally spend more then they get, not is their national debt getting out of control. If every country followed that - or had followed that, like Greece - things would look a lot better.

Governments are not households. Macroeconomics is not microeconomics. It is more important for governments to minimize unemployment (with productive jobs, not breaking windows and then fixing them) than it is for them to pay down public debt.

Comment: Re:They're bums, why keep them around (Score 1) 742

by smaddox (#49769119) Attached to: Greece Is Running Out of Money, Cannot Make June IMF Repayment

He's not saying they should. He's saying they're screwed either way, because without Government stimulus the GDP will continue to tank until there is no more private debt. The EU governments signed away their economic sovereignty just to simplify inter-country trade. Only the largest entities with controlling majority votes will benefit.

Comment: Re:They're bums, why keep them around (Score 1) 742

by smaddox (#49769053) Attached to: Greece Is Running Out of Money, Cannot Make June IMF Repayment

Repeating what I said above:

Sovereign governments are not households. Macroeconomics is not microeconomics. Having a growing GDP matters more than the level of public debt. If you sacrifice the former to reign in the latter (austerity), you're doing it wrong. Our entire capitalist economy is financed by debt. Without growing debt, currency deflates (unless the central bank creates more), which discourages investment, which reduces GDP. Empirically, Debt/GDP rises when austerity is implemented, simply because GDP falls faster than Debt.

If 25% of the population is unemployed, the worst thing you can do is balance the Government's budget. You need to get people working and investing.

Comment: Re: They're bums, why keep them around (Score 1) 742

by smaddox (#49768911) Attached to: Greece Is Running Out of Money, Cannot Make June IMF Repayment

Sovereign governments are not households. Macroeconomics is not microeconomics. Having a growing GDP matters more than the level of public debt. If you sacrifice the former to reign in the latter (austerity), you're doing it wrong. Our entire capitalist economy is financed by debt. Without growing debt, currency deflates (unless the central bank creates more), which discourages investment, which reduces GDP. Empirically, Debt/GDP rises when austerity is implemented, simply because GDP falls faster than Debt.

Comment: Re: Germany should pay war reparations for WWII (Score 1) 742

by smaddox (#49768499) Attached to: Greece Is Running Out of Money, Cannot Make June IMF Repayment

How does the absolute value of the currency matter? I don't understand this assertion. I completely agree that Greece would be far better off with the ability to control their own currency (all EU countries would be). But I've never understood why exchange rates matter from a macroeconomic perspective.

Once it hits the fan, the only rational choice is to sweep it up, package it, and sell it as fertilizer.

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