(In the 2004-05 time frame, on a site long ago, debate emerged comparing the virtues of econometric modeling with climate modeling. I have long blamed Bill Gates. Just kidding. But not by much. It strikes me as no coincidence that the computer modeling roared just as computational power soared. We’re now re-equilibrating to properly factor in human, uhm, behavior patterns, which are far from godly or gaussian.)

L3 and I and some others discussed this a month or two ago. All stimulation is necessarily micro-economic in nature.

And the good news is so is all economic disaster. Were it not for theis built-in damage controll system, H Sapiens would have perished of malnutrition eons ago.

BTW: Where can I get a glossary of all those
terms you were using? I reckon that you were debunking econometric modeling. That true?

My saying is that all those found guilty of econometric modeling should be sentenced to 30 years in solitary listening to the Knesset debate Keynes.

I agree entirely with those who say that borrowing against property in order to buy the latest consumer toys is both reprehensible and stupid. Unfortunately, this behaviour drives up house prices for the prudent, as well. So people who actually are behaving responsibly are punished for the sins of those who are not.

This includes both the people who are remortgaging to buy toys and the bonus-chasing crooks who facilitate such behaviour. It applies especially to the members of the financial community who cover up the shenanigans of their fellows by wrapping up junk debt in ever-more-complex wrappers to cover up their stupidity and greed. Those who are simply struggling to buy a decent house are caught in the crossfire.

I have heard a new Internet meme that might be amusing. Unfortunately, it works better on the British side of the pond. It’s a new collective noun for bankers. The new word is “wunch”. Think about it.

And to make matters worse, we restricted our reproduction and aborted about 30 million children that we really could use at the moment. Talk about cutting our own throats. Anyway, the problem again is not enough people to borrow and produce and spend energetically.

I’m not economically savvy at all, but that sounds more like a prescription for deflation than inflation. No?

The economic situation with regard to two people I know illustrates this. My sister in law, call her Lee for now, has a husband who is dying of a neurodegenerative disease. He hasn’t worked in 8 years and before that underperformed in his career. Lee ended up nearly in foreclosure about 4 years ago as a result of this. I should add that it took over a decade to have her husband adequately diagnosed, so they could not plan for the consequences of this disease. People just kept thinking he should get a job. Lee felt horrible about her difficulties paying her mortgage, and worked two jobs. 10 -12 hour days in Manhattan and nights and weekends waiting tables. She was very good at her job, but unable to keep up due to the high taxes and high cost of living in NY. Eventually, she decided to sell her NY house and make a very difficult, I would say traumatic, move to NC. She was able to pay off her NY house and purchase a house outright in NC. She got out of debt. However, she bought only a house she could afford, which was a very modest home. She could really use a larger one, but she wanted to keep out of debt. Despite difficulties that far outstrip any sob story I have heard about people in foreclosure, Lee got out of debt. If she can do it, anyone can. It may be difficult, it may take time, and it will certainly involve loss. But it can be done.

Her sister, call her M, has lived a life 180 degrees opposite. Her husband is healthy, and owns a construction business in Fl. When times were good he went further and further into debt. They live in a huge minimansion. They have a jacuzzi. He gets a new truck whenever he wants one. Their home is luxuriously furnished, their kids have anything they want and they eat out at expensive restaurants often. Lee tried to tell M that going into debt was not a good thing. M and her husband refused to listen. It is interesting to note, that during Lee’s extreme difficulty with her sick husband, still ongoing, M and her husband have never so much as visited her nor offered her one dime. Now M and her husband are on the verge of bankruptcy. Their home is worth less than they paid for it. Boo-hoo. They are on the verge of bankruptcy. They richly deserve it.

A society cannot support this sort of overconsumption for very long. If we inflate our way out of it, we encourage M’s behavior and punish Lee. The grasshopper, who refused to put aside for the coming winter, now returns to turn the ant out of his house.

If you reward a behavior, you will get more of it. But the behavior of going into debt to overconsume things that are not needed is unsustainable. It simply cannot keep going. So we should not reward it.