Is the Jig Just About Up? Are both the Forum Dems and Pubbies Unrepresentative?

[Torie]

The jig being up, in that the Feds and California are having trouble borrowing, and interest rates are ratcheting up, and ratings down (e.g. SF and Philly bond ratings downgraded, Hamtramack BK).



Meanwhile, it is my impression that on this Forum, the Pubbies are reasonably happy with the deficit commission's work so far, while the Dems disdain it. That apparently is precisely the opposite of what the Dem and Pubbie partisans think out there on the Fruited Plain. The Dems are generally supportive (although everyone seems to dislike taking hits for themselves), while the Pubbies hate it. Why? Because the Pubbies hate any tax increases. So apparently while the Dems are willing if need be to do to the entitlement state what the allies did to Dresden in WW II, while what the Pubbies want to do to the entitlement state is what Rome did to Carthage - not only destroy the place, but then make it into a toxic waste dump (Rome poured salt over the city's former footprint, making it into a lifeless salt flat), so that no life will ever emerge there again. At least Dresden had some buildings left standing, and it was possible for life to resume there in due course.

I see voters in general being very unhappy for a very long time. Laissez les bon temps roulez is just so yesterday. Policy proposals to slash your benefits and raise your taxes are a party pooper. But they are going to have to get used to it, and suck it up.

[opebo]

No, those bond yields are climbing for the usual reason - the economy is getting better.

But, yes, the failure to properly tax, and the relentless attacks on our few petty citizenship benefits both continue in full force.

[Torie]

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[opebo]

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Dude, its Fantastic over here.  Its only a matter of time before even the moribund USA follows along behind the new Center of the Universe (Asia).

[Beet]

Municipal bonds are selling off because of the Republican take-over of Congress. The Republicans, unlike the Democrats, oppose extending the Build America Bond program. The expiry of that program at the end of the year will greatly increase the supply of traditional muni bonds. Greater supply / Same Demand ==> lower price.

In addition, today was a strong day...

Bargain-hunting investors reversed an eight-day slump in America's $2.8 trillion municipal bond market on Thursday, bringing relief after hard-pressed local governments rushed to sell a glut of new debt.

Prices on long-term maturities, which had been most severely stung this week, opened higher on Thursday and improved steadily. Yields on top-quality bonds of 25 years and longer eased 10 to 12 basis points as prices rose, according to MMD.

In another hopeful sign, the week's biggest deal, $10 billion of short-term California revenue anticipation notes, priced for big institutional investors as expected, but at fatter rates than paid to individual buyers earlier this week.

---

As for Treasuries, they had fallen abnormally low earlier in the year on anticipation of QE. The backlash against QE has caused investors to discount the Feds' extension of the program, which has raised yields. These yields are still near half century lows. If you think low interest rates are the best indicator of economic health, the US is in better shape today than at any time since at least the 1960s.

It is true that deficit reduction is a liberal idea, because liberals want to maintain the social insurance that has underpinned the stable and prosperous world that emerged from the 1920s and 30s. They do not want to see collapse, because they think the result would be worse than what we have now -- are inherently conservative, and Democratic voters may understand that. Republican voters may not.

[Torie]

I hope you are right, but I don't think so Beet, and that is not what the article suggests. I dumped my munis well over a year ago. They are an imprudent investment. You do know that a host of municipalities are illegally using bond proceeds to finance day to day operating expenses don't you?  That is what happens when the end times draw near. It is a pity Cooley won't win the AG slot, because he should start prosecuting people. And the balance sheets are facially fraudulent.

[Beet]

I may well be wrong. I'm still more worried about Europe at this time-- what is needed is some actual growth in Spain. We live in scary times, that's for sure.

[Ban my account ffs!]

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Dude, its Fantastic over here.  Its only a matter of time before even the moribund USA follows along behind the new Center of the Universe (Asia).

The economy is doing quite well here.  Of course that's anecdotal.  But as far as my analytical mind can tell, traffic is heavier, new houses are going up all over, and every available plot of commercial land is being built up.

Recently a video store closed here thanks to the tanking conventional video store market... and within a few weeks the place was remodeled and is now yet *another* verizon store.

Unemployment continues to fall well below the peak and faster than the last major recession here:  1991.

The jobs pay crap.. but it doesn't cost much at all to live here either.

[CARLHAYDEN]

The jig being up, in that the Feds and California are having trouble borrowing, and interest rates are ratcheting up, and ratings down (e.g. SF and Philly bond ratings downgraded, Hamtramack BK).



Meanwhile, it is my impression that on this Forum, the Pubbies are reasonably happy with the deficit commission's work so far, while the Dems disdain it. That apparently is precisely the opposite of what the Dem and Pubbie partisans think out there on the Fruited Plain. The Dems are generally supportive (although everyone seems to dislike taking hits for themselves), while the Pubbies hate it. Why? Because the Pubbies hate any tax increases. So apparently while the Dems are willing if need be to do to the entitlement state what the allies did to Dresden in WW II, while what the Pubbies want to do to the entitlement state is what Rome did to Carthage - not only destroy the place, but then make it into a toxic waste dump (Rome poured salt over the city's former footprint, making it into a lifeless salt flat), so that no life will ever emerge there again. At least Dresden had some buildings left standing, and it was possible for life to resume there in due course.

I see voters in general being very unhappy for a very long time. Laissez les bon temps roulez is just so yesterday. Policy proposals to slash your benefits and raise your taxes are a party pooper. But they are going to have to get used to it, and suck it up.

I have repeatedly posted my opposition to the tentative commission proposal (guess you missed those, or misunderstood them).

Truth is that the pseudocuts are actually merely cuts in the rate of increase for social programs whereas the tax increases are real.

[tpfkaw]

I've seen much more vitriol directed at the deficit plan from Democrats (raising the retirement age 2 years for people born in 2006 and later is "completely unacceptable") than from Republicans, who tend to make comments along the lines that the plan is "interesting" or "provocative."

If there is any greater level of Democratic support, it's because they boxed themselves in by saying over and over throughout the entire campaign that deficit reduction plans would have to wait until the commission report.

[Torie]

Yes CARL, it would be an impertinence and an outrage to suggest that you fit very well into any particular cohort of voters. I certainly did not mean to box you that way. That would be just so wrong.  

[Torie]

I've seen much more vitriol directed at the deficit plan from Democrats (raising the retirement age 2 years for people born in 2006 and later is "completely unacceptable") than from Republicans, who tend to make comments along the lines that the plan is "interesting" or "provocative."

If there is any greater level of Democratic support, it's because they boxed themselves in by saying over and over throughout the entire campaign that deficit reduction plans would have to wait until the commission report.

That is from the Dem politicians, not the Dem voters (per the poll). It is all mixed up out there man. We live in interesting times.

[tpfkaw]

I'm referring to comments from politicians.

[CARLHAYDEN]

I've seen much more vitriol directed at the deficit plan from Democrats (raising the retirement age 2 years for people born in 2006 and later is "completely unacceptable") than from Republicans, who tend to make comments along the lines that the plan is "interesting" or "provocative."

If there is any greater level of Democratic support, it's because they boxed themselves in by saying over and over throughout the entire campaign that deficit reduction plans would have to wait until the commission report.

Actually, Reid previously made a sort of pledge to bring the recommendations of the commission to a vote before the Senate.

http://democrats.senate.gov/newsroom/record.cfm?id=322454&

[Beet]

Yes CARL, it would be an impertinence and an outrage to suggest that you fit very well into any particular cohort of voters. I certainly did not mean to box you that way. That would be just so wrong.  

Are you kidding? He fits into the most influential single cohort of voters in existence - Very 'Conservative' voters, though in reality, I am much more conservative than him.

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Scary is the word. There's nothing 'interesting' about these times. The problems we face are complex yes, but they're also the type that you would rather not think about in an ideal world.

[Torie]

"Interesting times" as in the Chinese insult, "may you live in interesting times."  I assume that phrase is part of your repertoire, no? 

[CARLHAYDEN]

"Interesting times" as in the Chinese insult, "may you live in interesting times."  I assume that phrase is part of your repertoire, no? 

Here's a cite for him:

http://en.wikipedia.org/wiki/May_you_live_in_interesting_times

[dead0man]

I may well be wrong. I'm still more worried about Europe at this time-- what is needed is some actual growth in Spain. We live in scary times, that's for sure.

Other than maybe a brief time during the 90s, what people haven't lived in "scary times"?  This isn't as scary as the Cold War, it's certainly not as scary as WWII or WWI or the period between them or the entire period before them going back to when we first started gathering together in tribes.

[opebo]

...This isn't as scary as the Cold War, it's certainly not as scary as WWII or WWI or the period between them...

Actually the Cold War was only a fake scare, just like the 'terrorism'.  The current period should produce more anxiety in rational people than any time post WWII, simply be cause we are exposed to collapse in a way we weren't when we had proper Keynesian policy and regulation (1930s-1980).