Dark Man Cometh???

[Shuffler]

Well, how long for the USA death toll to go from 1000 to 2000???
About 2 days, and it's pickin up speed.. Was 2, now 13 cases in our AO..

We're on the Highway to Hell, 

My sons and I were out walking the perimeter, topic of
conversation, what the world will look like when this is over???

Note New York city is almost half that alone.

Texas has 34 deaths as of today. Still more folks dieing on the road daily.

[Shuffler]

  So how does it work if you are over 6ft tall?  do you have to leave 12ft space?

  Be safe,wash your hands and face.


   

Just as many do every flu season.

[icepac]

You're basing your stats as if this is over.

Wait until it's over and get back to us.

[Arlo]

Note New York city is almost half that alone.

Texas has 34 deaths as of today. Still more folks (dying) on the road daily.

Obfuscation.

ob·fus·ca·tion
/ˌäbfəˈskāSH(ə)n/

noun

the action of making something obscure, unclear, or unintelligible.

Spurious correlation (<- click me for more examples)

[Shuffler]

You're basing your stats as if this is over.

Wait until it's over and get back to us.

You are talking like it WILL be over. It is another flu. It may stay and we live with it.

[Shuffler]

Obfuscation.

ob·fus·ca·tion
/ˌäbfəˈskāSH(ə)n/

noun

the action of making something obscure, unclear, or unintelligible.

Spurious correlation (<- click me for more examples)

Sorry you do not understand my post. Try google.

[Arlo]

Sorry you do not understand my post. Try google.

Dying of complications due to the Corona virus is to dying in a car crash like U.S. spending on science space and technology is to suicides by hanging, strangulation and suffocation. (You didn't bother clicking the link last time so why should I expect it this time?)

[Brooke]

It's times like these that we should whip out the credit card and throw money around.
. . .

My problem is that they keep throwing money around when times are good and the economy cooking.  That's when you should pay off the credit card.

That's what Keynsians believe:  print and give out money in tough times; pull it back during good times; and that's the best for your economy.

Austrians dispute that.  They believe that your economy would be better off if you let a free market deal with it.  You'd suffer a bigger decline, but get a bigger rise on the other side, and overall end up in a better position.  They believe that the decline is necessary to fix things in the economy that contributed to the decline.  That if you paper it over, you feed what went wrong instead, and have as much or more of it still lingering after the crisis is done.

Assuming true Keynsianism does work (again, which Austrians dispute), the problem -- as you point out -- is that only half of it gets done in actual practice, and the other half of it does not.  We are on permaprint.  Why?  Because pulling money back is political suicide and will rarely happen.  We all know this.  Just like we all know that having a benevolent dictator sounds nice, but dictatorships in real life suck.

Paul Krugman (Nobel prize winning economist and leading Keynsian) wrote the book "The Return of Depression Economics and the Crisis of 2008" in which he talks about Keynsianism and gives multiple historical examples of its use.  Here is a summary of nearly all his examples:  Keynsian stimulus pulled the economy out of trouble; but the guys in charge did not pull the money back when times were good; and so the economy subsequently went back into the toilet.  His conclusion:  Keynsianism is great.  My conclusion:  Keynsianism doesn't work in practice.  You can't ignore the real incentives and real imperfections present in real life.  You can't say "My new engine design is highly efficient!" by ignoring that its real-world efficiency, which includes friction, is bad.

I think that the Austrian way is better.

[CptTrips]

That's what Keynsians believe: 

So you think we should have fought WWII without raising the military budget above 1941 levels? 

Should we have fought Nazi Germany and the Empire of Japan without any borrowing?

There is a difference between Keynsian manipulation of the market as a matter of normal policy, and the emergency mobilization of all possible resources during an national emergency.

[TheBug]

I think everybody should get outside more.

[Shuffler]

Dying of complications due to the Corona virus is to dying in a car crash like U.S. spending on science space and technology is to suicides by hanging, strangulation and suffocation. (You didn't bother clicking the link last time so why should I expect it this time?)

Dead is dead. Many people have had corona and not died. Some people have had corona and died. So?

[Arlo]

Dead is dead. Many people have had corona and not died. Some people have had corona and died. So?

You talk of the daily loss of lives in car accidents to downplay the lives lost, so far, to the corona virus. A car ran through our apartment a week and a half ago (thankfully no one was hurt). None of us had to be inoculated against 'car wreck' and the odds of any of us catching 'car wreck' as a result of that accident is slim .... because a car wreck is an accident and not a highly contagious and deadly disease. (Edited out the unnecessary last bit .... well, and first bit. After all, we're all in this together.) 

[icepac]

16,000 new cases in the last 11 hours.

[Busher]

I have no idea if any Doctors or Nurses play our game... or maybe you have one of these professionals in your life. But in the same way we thank Military Service men and women for their service, it's time that we all pay tribute to the medical experts for their courage and dedication.

[Brooke]

So you think we should have fought WWII without raising the military budget above 1941 levels?

Of course not.  And neither would Austrians.

There is a difference between an event outside of economics that you need to respond to (like a war or an epidemic) and an event inside economics that you decide how to respond to (such as, to name the previous three instances, 1997-1998 currency/Long Term Capital Management crisis, 2000 Dot.com bubble crash, 2008 MBS bubble crash).

Now, we have the 2020 crash.  Some money is needed to deal with SARS-2.  But of $4 trillion, only a smaller portion is going to be used for SARS-2.  Most of it will go to companies that have problems because, long before there was SARS-CoV-2, they packed themselves to the gills with bad debt.

We've had a decade of zero (!) interest rates.  Totally as expected, it blew the biggest bubble the world has ever seen.  SARS-2 is a pin, but if not for SARS-2, it eventually would have been something else.  We must deal with SARS-2.  But, for economic health, the lanced financial bubble should be allowed to fully drain.

How I see it for the past several cycles:

1997-1998 currency/Long Term Capital Management crisis
-- Asian currency crisis causes hugely levered Long Term Capital Management to implode.
-- Fed/gov fearing contagion (because LTC was levered up to about $1 trillion in derivatives) injects huge liquidity.
-- Liquidity always goes somewhere, this time into the new thing of dot.com stocks.
-- The dot.com bubble inflates to silly proportions.
-- All bubbles eventually crash, and . . .

2000 dot.com bubble crash
-- No real trigger other than valuations just got too absurd.  NASDAQ goes down 80% from peak.
-- Fed/gov injects huge liquidity.
-- Liquidity always goes somewhere, this time into real estate and new-fangled derivatives, CDSes and MBS's.
-- The MBS bubble inflates to silly proportions.
-- All bubbles eventually crash, and . . .

2008 MBS bubble crash
-- No real trigger other than valuations got too absurd.  Chain of firms levered to the gills on garbage debt and swaps start to blow up.
-- Fed/gov injects injects largest liquidity in history of the world.
-- Liquidity always goes somewhere, this time so much liquidity that it goes into everything:  stocks, bonds, real estate, and debt of all types.
-- The Everything Bubble inflates over 10 years of 0% interest rates.
-- All bubbles eventually crash, and . . .

2020 "Covid" crash
-- SARS-2 turmoil.  Companies levered the hilt on garbage debt immediately are in trouble.  They spent all their money from the good years on buying back stock and adding to their debt.
-- Fed/gov starts injecting more liquidity at faster rate than even 2008.

And, here we are.