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Comment Re:My two rules of printing (Score 3, Insightful) 381

My rule for inkjets is similar. Unless you're a pro-grade graphics type doing pro-grade graphics stuff on a pro-grade inkjet printer, you probably bought a machine with one design intent: Turning full / working ink cartridges into empty / dead ink cartridges. Any printing the machine does during that process is purely coincidental. Don't do it. You'll only encourage them to make more.

Comment Re:Thank goodness (Score 1) 999

Of course we are talking about people without insurance already and the law specifically puts congress and it's staffers into that category so including them is more then appropriate.

OK, so we're moving them into an entirely different category of worker by grand fiat. I suppose the fact that hey get paid better than the average McDonald's worker is also "special treatment" and not just part of their normal compensation package for their skill sets. Somebody should pass a law cutting them to minimum wage so they really feel the pinch. Forget paying market wages for marketable skills, we have a point to make. In fact, let's test our welfare system by cutting their pay to $0. Surely that's not a stupid idea that will backfire as soon as it hits market realities.

You have people who can't afford it, or do not incur medical costs and do not purchase insurance, and you have some who might be mooching off the rest of us by making us bear their medical cost.

If you're walking around without insurance secure in the knowledge that you'll be treated in case of catastrophe, you're basically stealing catastrophic coverage from the rest of us. We pay more so you can do that. The fact that you never use it is a side issue. Risk has a price, and insulation from risk has a value. If everybody behaves that way, the system collapses.

Well, here is a constructive alternative, instead of forcing everyone to get insurance, how about forcing people who don't pay their medical bills to get insurance.

How, exactly, would that work mathematically? What you're describing is known as adverse selection. Again, if everybody behaves this way, the system collapses.

Insurance is pretty simple. Most people pay in more than they ever take out so that a small subset of people can take out way more than they put in. The only way it works is if the ratio of payers to redeemers is high enough. You can't create a system where everybody opts out of being a payer and then jumps into being a redeemer when they need it, even if you penalize them some small amount.

Comment Re:Thank goodness (Score 1) 999

Every single citizen in the US who did not have insurance had their market wage reduced by the requirement by law to spend part of those wages or have them removed by the federal government.

Ah, so we're talking about people who don't have insurance already. OK. So that's a little different. Congressional staffers had insurance as part of their pay and then lost it, and the Republicans fought for the Vitter Amendment which prevents the OPM from making up that cut in dollars like it would in the regular market for people who have insurance as part of their pay package. They're creating a perverse situation that doesn't actually exist in the private markets which specifically screws the staffers.

People who don't have insurance fall into two categories. Either they can't afford it, in which case the exchanges should be a major boon to them, or they're mooching off the rest of us by making us bear their medical cost risks for them, and I don't have a lot of patience for whining over them having to pay into the system. Cry me a river.

The law specifically said they had to go onto the exchanges. Any rational person not believing that there is one set of rules for the subjects of the crown and another for the crown's court would understand this to mean they had to participate in the exchanges just like the millions of other people who fall under the law.

Nobody was keeping them off the exchanges. They were going to the exchanges. They're still going to the exchanges. The only question was whether the government would behave like a normal employer and pay the cash savings over to the employees so they could spend it on the exchanges or whether they'd take an arbitrary pay cut the likes of which doesn't happen to the rest of us if our employer drops coverage.

If you take a few deep breaths and calm down, maybe you'll see it more clearly. You seem pretty amped up on hate for congressional staffers. They didn't have a "special exemption" before the Grassley amendment. They just had employer health care like most of us do. They weren't getting special treatment before the Vitter amendment. The only problem comes from the fact that Congress is calling this a "subsidy" which is illegal, instead of what it really is: being paid their negotiated wage.

Second,what republican has ever said staffers couldn't get a raise?

David Vitter. But only in the sense that it can't be called a "subsidy." And it's not really a raise, but a "not cut." This whole thing is a weird parsing of the word "subsidy" versus "raise" versus "cut." The basic market outcome was broken by the Grassley amendment and the Vitter amendment was an attempt to keep it broken.

They'll eventually have to pass something entirely different to give the money back in a way that doesn't look like a "subsidy", but the Republicans are making a hard stand on it as though there's a meaningful principle at stake, probably because the voters are confused and really think that extra money is being shoveled into the pockets of staffers, and hating on those guys is playing really well in the media right now. "Here's the money we just took away from you" isn't a subsidy by any reasonable definition.

I don't see that as a terrible thing. Some claim the staffers have too much power and influence in government and constant changing of them would negate that so the representation of the people takes priority.

That's fine. If your position is that we're better off with an across the board pay cut of between $5,000 and $11,000 for congressional staffers who aren't exactly making bank, that's a perfectly valid place to be. But it doesn't have anything to do with "special treatment" for anybody.

And for the record, I'd like to see *everybody* on the exchanges. You, me, Congressional staffers, Senators, everybody. Employers should stop buying insurance for their employees and just give the employees the cash directly. We'll all be better off with a functional market for insurance instead of the mess we have now.

Comment Re:Derp (Score 1) 282

With the proviso that magicing huge amounts of money out of nowhere is not a valid way of entering into this.

You didn't answer the question why? What, exactly, is wrong with changing the amount of money in the economy? Is the current amount exactly the right amount for the circumstances? Is it a moral objection? Superstitious? The appropriate money supply for an economy is kind of a big piece of 20th century economic thought, so the assertion "never change it, ever" seems like it should have some fairly solid theoretical grounding.

Comment Re:Crisis not solved, made worse (Score 1) 282

Fiat currencies do not work, they all fail given enough time.

I always love this line of reasoning. "Every fiat currency in history has failed. Except for the ones that haven't. Therefore, all of the currencies that haven't failed will eventually fail." I suppose it's trivially true that everything we build will fail sometime before the heat death of the universe.

Comment Re:Crisis not solved, made worse (Score 1) 282

[insert face palm here] Borrowing more money does not help your credit.

Which helps your credit less?

A) Borrowing money.
B) Saying that you are not going to repay your creditors.

I'm pretty sure the answer is (B).

The last time the US's credit was downgraded, it was because they did another huge round of borrowing.

Holy crap, did you read S&P statement on the reason for the downgrade? They explicitly wrote that threatening not to raise the debt ceiling was the reason for the downgrade.

Comment Re:Liquidity (Score 1) 321

I'm wondering what it would take for an enterprising team with a large amount of capital to risk to induce a flash crash for fun and profit on a lower volume asset that's known to be populated by HFT bots. These things are ultimately just control systems, so it should be possible with the right set of inputs to "smack it with a hammer" and cause instability and then profit from the brief swing while the system re-settles.

The main problem would probably be that characterizing the system by feeding in streams of orders would cost a huge amount of money, and anything you learn about the system would only last until the HFT logic is updated.

Comment Re:Liquidity (Score 4, Insightful) 321

This is the point I always make. There have always been useless lumps who happen to be close to the action who make money off of the spreads. There are just more of them now, and they're fighting really fast over micropennies. If we're going to complain, I'd like to see evidence that the total profit these guys are making is going up relative to the size of the market. Sure, if they're giving the average trader a huge haircut, that's not a good thing, but market efficiencies being what they are, I suspect that the total amount of skim hasn't changed all that much since the early days.

The only real problem I can think of is that we've replaced that useless lump who has no real skills with mathetmaticians and engineers who could be doing something more useful elsewhere. It's probably not a great use of those resources, but it's pretty small scale.

Comment Re:implications of default (Score 1) 282

It's just a very weird way of looking at bonds in a trust fund. If you had a private pension plan full of US government bonds, it would be fully funded and you'd be happy. But move the same pension plan with the same rules and the same payment schedule to the government ledger and suddenly it's a ponzi scheme and we "owe money to ourselves" or some such nonsense. It's a bizarre analysis. It's like saying, "I bought these Ford bonds to retire on, and Ford went and borrowed the money from my retirement kitty and spent it in on stuff! Where's my cash??" Macro is clearly more complicated than people think.

Comment Re:Not Raising Debt Ceiling != Default (Score 1) 282

Who said the Treasury would have the authority? That's Congress' job; constitutionally they have the power of the purse. They're the "elected representatives" in this representative republic (for what it's worth).

Sure, Congress could do that, but they didn't. That's the whole problem. There are no rules about who gets stiffed when the government runs out of money except for a vague statement in the Constitution that the government won't stiff its creditors. So the Treasury is in a difficult spot. Congress has said, "You legally must spend this money that we haven't given you, and don't borrow to make up the difference." They're not tooled up to pick and choose who gets paid (Why would they be? The Feds aren't supposed to default on any payments!), and even if they were, there's no clear authority or guidance on how to do it. Whatever they did was going to piss somebody off and probably be technically illegal that they'd lose in court over it.

If Congress could pass some legislation cutting certain types of spending, that would be just fine and you wouldn't hear us howling. In fact, that would be them doing their job. But they didn't do that. They just dumped an impossibly big turd into the punch bowl and walked away, expecting Treasury to make everything work out. That's either an indication of terrifying levels of irresponsibility or a woeful misunderstanding of how the financial system works.

Comment Re:Not Raising Debt Ceiling != Default (Score 1) 282

Sounds like an awesome plan. Give the Treasury the authority to decide what is "less-than-essential" and the infrastructure to do fine-grained control on who gets a check and the crisis is indeed solved. I just suspect that you won't always agree with the Treasury about what's essential.

I like your idea of pulling support for government backed loans. "He defaulted, so you're on the hook." "Well, I'm not paying, but this isn't to be considered a default." The markets love it when borrowers do stuff like that.

Comment Re:implications of default (Score 1) 282

The DotCom boom brought in a surplus in Social Security revenue and instead of putting that in the SS trust fund as legally required, they went and "borrowed" it for the usual overspending that has now become baseline. If you or I took money from a trust and used it for another purpose not stated in the trust we'd be in jail.

The better way of putting that would be that instead of sitting on cash, the SS Trust Fund bought US government bonds which will be paid back to them just like all of the other bonds as long as we don't let the Republicans have their way. The surplus was accrued by design because the trustees were well aware of the fact that Baby Boomers will get old. As long as we don't do something stupid like default on our debt, Social Security is just like any other pension plan that holds US bonds.

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