tag:blogger.com,1999:blog-2098432983500045934.post1779101849899688243..comments2024-03-12T22:19:32.339-04:00Comments on The New Arthurian Economics: How can you even know if it's not a problem?The Arthurianhttp://www.blogger.com/profile/16501331051089400601noreply@blogger.comBlogger12125tag:blogger.com,1999:blog-2098432983500045934.post-42569261434626268642013-04-30T06:25:09.233-04:002013-04-30T06:25:09.233-04:00Thanks, Steve.
Jever notice, the people least con...Thanks, Steve.<br /><br />Jever notice, the people least concerned about the Federal debt generally use the lower ("Held by the Public") number, while those most concerned generally use the higher ("Gross debt") number...<br /><br />I think both sides' arguments are weakened by those choices.<br /><br />But yea, "held by the Fed" is a different matter altogether. That should not count as debt, at all.<br /><br /><a href="http://newarthurianeconomics.blogspot.com/2012/12/federal-debt-held-by-federal-reserve.html" rel="nofollow">Found it</a>!<br />The Arthurianhttps://www.blogger.com/profile/16501331051089400601noreply@blogger.comtag:blogger.com,1999:blog-2098432983500045934.post-72493435437791483612013-04-29T20:26:20.662-04:002013-04-29T20:26:20.662-04:00When that measure says "held by the public,&q...When that measure says "held by the public," btw, that includes "held by the Fed." So one might want to deduct that as well.Steve Rothhttps://www.blogger.com/profile/11895481216028771016noreply@blogger.comtag:blogger.com,1999:blog-2098432983500045934.post-64434460122642495092013-04-29T20:25:11.459-04:002013-04-29T20:25:11.459-04:00Keep at it! Good job.
For public debt, BTW, it...Keep at it! Good job.<br /><br />For public debt, BTW, it's generally best to cite "Debt Held by The Public" as opposed to Gross Public Debt. (Wondering why people are confused...?) This excludes amounts the government owes to itself (SS and MC trust funds, mainly), and this measure is well below 90% of GDP.Steve Rothhttps://www.blogger.com/profile/11895481216028771016noreply@blogger.comtag:blogger.com,1999:blog-2098432983500045934.post-6816655180862746262013-04-29T07:26:25.578-04:002013-04-29T07:26:25.578-04:00Art, be my guest...you are a much better story-tel...Art, be my guest...you are a much better story-teller than me.paul melihttps://www.blogger.com/profile/04604543110795683837noreply@blogger.comtag:blogger.com,1999:blog-2098432983500045934.post-62405684689857487132013-04-29T07:03:10.511-04:002013-04-29T07:03:10.511-04:00"...if you sum all the deficits it's grea..."...if you sum all the deficits it's greater than Debt Held by the Public"<br /><br />Paul, I have in mind to use your observation as the basis for one or more posts. (Let me know if that's not okay.)<br /><br />What I'm looking at so far is the <a href="https://docs.google.com/spreadsheet/ccc?key=0Aupyd4Usl6QkdFRjTEgydGRBOW5HdmpBazJhUzZncnc&usp=sharing" rel="nofollow">Sum of Deficits</a> from various sources and the <a href="https://docs.google.com/spreadsheet/ccc?key=0Aupyd4Usl6QkdDhWUnZraUt5RVdweHhxMURmNEZPbXc&usp=sharing" rel="nofollow">Measures of Debt</a> from various sources.<br /><br />Both links bring up Google Drive spreadsheets.<br /><br />A third sheet will compare the various measures of debt with the various sums of deficits. Didn't start that one yet.<br />The Arthurianhttps://www.blogger.com/profile/16501331051089400601noreply@blogger.comtag:blogger.com,1999:blog-2098432983500045934.post-47311071147096440382013-04-28T18:43:59.292-04:002013-04-28T18:43:59.292-04:00Ok Paul, the mowing is done and I am starting to l...Ok Paul, the mowing is done and I am starting to look at your stuff. Thanks. Your comments above help.<br /><br />(<i>After</i> I satisfy myself that I understand the graph by successfully duplicating it, then it will be easier for me to think about what the graph shows.)<br /><br />I'll get back to ya.<br />The Arthurianhttps://www.blogger.com/profile/16501331051089400601noreply@blogger.comtag:blogger.com,1999:blog-2098432983500045934.post-85032917296617508282013-04-28T08:11:43.998-04:002013-04-28T08:11:43.998-04:00Art, one more clarification...
most FRED series a...Art, one more clarification...<br /><br />most FRED series are running totals...accumulations.<br /><br />Deficits and Net Exports are expressed as annual change, so I converted them to running totals...(the balance column in your checkbook).<br /><br />Further, I didn't use the FRED series for deficits...I used Treasury historical data...here's the Excel file...<br /><br />https://www.dropbox.com/s/c43m9m1eo7hl5e6/debthist01z1.xlspaul melihttps://www.blogger.com/profile/04604543110795683837noreply@blogger.comtag:blogger.com,1999:blog-2098432983500045934.post-86202945546285996252013-04-28T08:02:31.778-04:002013-04-28T08:02:31.778-04:00Art, if you sum all the deficits it's greater ...Art, if you sum all the deficits it's greater than Debt Held by the Public...there's net cash in the system. The difference is about $2T.<br /><br />Proof that money can be spent into the economy without issuing debt if the government wants to.<br /><br />So NFA is not equal to Debt Held by the Public minus NETEXP.<br /><br />Total NFA includes NETEXP...I just focused on the domestic economy for this graph.<br /><br />There is little doubt that NFA creation supports the credit system in my view. Since government spending tends to go to saving (accumulation) this is an ongoing process not a pump-priming operation. No system is self-sustaining.<br /><br />I think this idea also supports the points you have been making about private debt, which I look at as like pushing a ball up a hill or creating a vacuum...the pressure is always on for that system state to revert to a stable equilibrium...when it does the bubble deflates.paul melihttps://www.blogger.com/profile/04604543110795683837noreply@blogger.comtag:blogger.com,1999:blog-2098432983500045934.post-6138413249624151662013-04-27T09:56:37.135-04:002013-04-27T09:56:37.135-04:00I love it when the year values get a comma to sepa...I love it when the year values get a comma to separate thousands from hundreds... :)<br /><br />Thanks, Paul -- Now I have some idea what NFA might be -- "sum of Federal deficits, less net exports" <br />In other words, the money the government put into the economy, less the money that left the country. Okay, good.<br /><br />Oh, but when I tried to duplicate the graph it didn't come out the same as yours. Paul, help me understand what NFADOM is.<br /><br />NFADOM = Net Financial Assets (domestic)<br /><br />In the middle of the graph it says<br /><b>Ratio of Private Debt to domestic NFA (∑ Deficits - NETEXP)</b><br />I assume the part in parentheses there is a definition of "domestic NFA"<br />The "Private Debt" is CMDEBT or the other FRED debt items.<br /><br />So if (∑ Deficits - NETEXP) = domestic NFA,<br />then I think (the Federal debt - NETEXP) = domestic NFA<br />Should be close, at least. Am I missing something here?<br /><br />For the Federal debt I used FGTCMDODNS at FRED, a value somewhat less than Gross Federal Debt.<br />NETEXP is a FRED series<br />CMDEBT is a FRED series<br />So for the Ratio of Private Debt to (∑ Deficits - NETEXP) I used<br />CMDEBT / (FGTCMDODNS - NETEXP)<br /><br />It shows me <a href="http://research.stlouisfed.org/fred2/graph/?g=hRu" rel="nofollow">this</a>.<br /><br />It is a significant graph -- I've done several showing that same general shape -- but it looks nothing like the graph you showed me.<br /><br />So now I'm at a loss. Can you help me duplicate your graph?<br />The Arthurianhttps://www.blogger.com/profile/16501331051089400601noreply@blogger.comtag:blogger.com,1999:blog-2098432983500045934.post-5409112001838043632013-04-27T09:54:12.518-04:002013-04-27T09:54:12.518-04:00Gene, I have such trouble coming up with good anal...Gene, I have such trouble coming up with good analogies. In general, anymore, if I wake up in the middle of the night with a good phrase about the economy, I get up immediately and start to write. 2, 3 in the morning, no matter. By 4 AM it will be gone.<br />The Arthurianhttps://www.blogger.com/profile/16501331051089400601noreply@blogger.comtag:blogger.com,1999:blog-2098432983500045934.post-42383582403722769022013-04-27T09:43:55.962-04:002013-04-27T09:43:55.962-04:00A very poor analogy I will use with my HS students...A very poor analogy I will use with my HS students that they will understand: The blue line is the economy. The Green Line is a squirrel in the middle of the road. We swerve to miss the squirrel(MUST avoid that 90% squirrel!!) and think we are free and clear (and proud of ourselves) until we hit the 1,000 pound bear standing on the Red Line. Guess a better choice would have been to run over the squirrel. But the bear still exists, waiting for us to drive around the block.<br /><br />I will work on it before class... :) <br /><br />GeneHaywardhttps://www.blogger.com/profile/08848814178464097668noreply@blogger.comtag:blogger.com,1999:blog-2098432983500045934.post-83343136659345476432013-04-27T07:45:07.553-04:002013-04-27T07:45:07.553-04:00Art, here's a problem...
https://www.dropbox....Art, here's a problem...<br /><br />https://www.dropbox.com/s/skm9xz1wmw9n9ms/Debt%20series%20rt.pngpaul melihttps://www.blogger.com/profile/04604543110795683837noreply@blogger.com