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The L-curve

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The L-curve

Unread postby Ludi » Fri 02 Apr 2010, 13:09:53

Someone probably already posted this, but if not, take a look - it's pretty interesting:

Depiction of income distribution in the United States:

http://www.youtube.com/watch?v=woIkIph5xcU
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Re: The L-curve

Unread postby Ibon » Fri 02 Apr 2010, 14:17:46

Nothing like graphics like that to visualize the inequity. And we just got that news today on the 25 billion paid out to the small number of hedge fund managers for 2009. Who didn't really do anything did they?

The heads of the aristocracy did role during the French Revolution.

History will repeat itself.
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Re: The L-curve

Unread postby Sixstrings » Fri 02 Apr 2010, 14:27:43

$this->bbcode_second_pass_quote('Ludi', 'S')omeone probably already posted this, but if not, take a look - it's pretty interesting:

Depiction of income distribution in the United States:

http://www.youtube.com/watch?v=woIkIph5xcU


400 billionaires, that's just obscene. Up until the early 70's at least, the highest tax bracket was 90%. And yet somehow society survived having fewer super-rich than we do today. We had more one-income families back then, with the men making a good living wage while the women who chose to could afford to be a full-time parent, rather than leaving the kids to be raised by institutional daycare. Kids would come home from school to find a mom at home, and maybe some cookies to eat -- was that so bad?

Of course now, in the land of 400 billionaires, we again have more one-income families -- but this time around, it's a two-income world and few can afford to be a full time parent. So forget the cookies, one income families are more likely to lose their home and be bounced out onto the street.

But hey, at least life is good for the super rich. We're a feudal society now, our lives are to be lived in humble sacrifice, so that the Google boys can fly around on that 747 party jet with the disco ball and stripper pole.

EDIT: and by the way, the old arguments abut all the good the superrich do are total BS now. The rich are only useful when they either buy American-made luxuries, employ Americans, or fund DOMESTIC American enterprise. But those were the old days, now it's all offshoring and investing in the global markets and speculating on commodities -- activities which further erode the domestic American economy.
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Re: The L-curve

Unread postby efarmer » Fri 02 Apr 2010, 14:48:54

I remember the good old days when they pulled a gun on you and tied you up
instead of loaning you money and letting you act like a rich fool while they were
robbing you blind.

On the hopeful side, they are probably done making our money worthless for awhile
since they sucked so much of it up for themselves the last few years.

It was a sad day when I realized I are Joe Six Pack with the Type O money.
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Re: The L-curve

Unread postby Sixstrings » Fri 02 Apr 2010, 15:07:18

$this->bbcode_second_pass_quote('efarmer', 'O')n the hopeful side, they are probably done making our money worthless for awhile
since they sucked so much of it up for themselves
the last few years.


I'm not so sure about that, since there are so many ways to make money by betting on financial destruction (shorting). A lot of the bailout money went to pay off the hedge fund types who made bets against subprime. They purchased insurance not in the way insurance should be purchased, but basically as insurance fraud. The very act of shorting actually speeds along the destruction that they stand to profit from.

Just look at the hedge fund guys who made fortunes on those subprime bets. One of them used to be a neurologist but started a hedge fund because he wanted to be a millionaire by age thirty, and neurology wasn't getting him there fast enough. So this is what you get when the primary motivation of a society is money alone -- in that paradigm, patriotism doesn't matter. Other people don't matter. Nothing matters but money, and the means to that end are irrelevant.

What you're assuming efarmer is that somehow the super-rich are tied to this country. If that were true, then it would be in their longterm interest not to kill the goose laying the golden eggs. But the fact is, the rich aren't tied to any one country anymore -- corporations are global, capital flows freely, and the rich can live anywhere they choose and continue to profit as global wealth is transfered from one "country" to another.
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Re: The L-curve

Unread postby Outcast_Searcher » Fri 02 Apr 2010, 15:13:51

$this->bbcode_second_pass_quote('efarmer', 'I') remember the good old days when they pulled a gun on you and tied you up
instead of loaning you money and letting you act like a rich fool while they were
robbing you blind.


Since when does irresponsible and/or ignorant behavior, such as borrowing money you can't afford at stupidly high interest rates, without paying any attention to the loan terms equate to being robbed? (Robbery implies with a weapon - by force).

We're fast approaching the day when less than 50% of voters pay income taxes. When that day comes and the majority vote themselves exponentially increasing "free" programs, THEN you'll get to see 70's style currency destruction again, for sure.

The saddest part of this, is that the folks hurt the worst by inflation are those at the bottom of the income strata.

So, keep blaming the most productive members of society who pay virtually all the income tax - yeah, that'll work, just like it has since the war on poverty began. :roll:

(I'm not rich, but I do believe in property rights. Silly me).
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Re: The L-curve

Unread postby Sixstrings » Fri 02 Apr 2010, 15:35:54

$this->bbcode_second_pass_quote('Outcast_Searcher', 'S')o, keep blaming the most productive members of society who pay virtually all the income tax - yeah, that'll work, just like it has since the war on poverty began.


I didn't say the rich aren't productive, the problem is that they're productive on a GLOBAL level. The super-rich are doing immense good for folks in places like Bangalore, where one outsourced American job can support 16 Indians.

As for hedge funds and shorting in general, it only serves a useful purpose in a market where failing corporations aren't bailed out. If the too big to fail always get bailed out, then shorting becomes purely parasitic.

As for us commoners not paying enough income tax, what do you expect man? You can't get blood out of a turnip. Oh, I get it, I guess you think we shouldn't have a social safety and that America should look like the slums of Bangalore. We should only have socialism for the rich, is that what you're saying?

Oh, and the housing crash was not caused by "people taking loans they couldn't afford." Don't you realize this was PLANNED by the Federal Reserve? The Fed controls credit policy, period end of story. In the wake of the dot com crash they CHOSE to blow a real estate bubble. We have no real economy anymore, it's just a game of kicking the can down the road -- and the Fed controls all this, not the little guy.
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Re: The L-curve

Unread postby efarmer » Fri 02 Apr 2010, 21:07:30

The illusion of fair markets in the nation is necessary to promote the illusion of significant
amounts of outsiders getting wealthy by participating. I believe our boys in New York and
Washington cleared up that illusion quite handily.

They say that Washington and Wall Street are broken, but I believe they are instead
fixed.
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Re: The L-curve

Unread postby mos6507 » Fri 02 Apr 2010, 22:51:01

$this->bbcode_second_pass_quote('Sixstrings', '
')The super-rich are doing immense good for folks in places like Bangalore, where one outsourced American job can support 16 Indians.


And here is the role that consumers play in perpetuating that:

Lay off on the simplistic class warfare.

$this->bbcode_second_pass_quote('Sixstrings', '
')Oh, and the housing crash was not caused by "people taking loans they couldn't afford." Don't you realize this was PLANNED by the Federal Reserve? The Fed controls credit policy, period end of story.


Sorry, man, it takes two to tango.
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Re: The L-curve

Unread postby Sixstrings » Fri 02 Apr 2010, 23:02:53

$this->bbcode_second_pass_quote('mos6507', 'S')orry, man, it takes two to tango.


Mos, voters have no say about the credit policy put forth by the Federal Reserve. This was all planned. They knew that because of falling wages, McJobs, offshoring, and automation that consumers couldn't afford to keep the economy afloat without some fast and loose credit. So they blew a bubble -- this was a deliberate policy of the Federal Reserve, to a blow another bubble and kick the can down the road.

But whatever. If it makes you feel better, go ahead and blame the American worker.

$this->bbcode_second_pass_quote('', 'L')ay off on the simplistic class warfare.


You prefer to blame people for shopping at Walmart. You know, consumers and labor are both inherently disorganized. "Buy American" campaigns never work for the same reason it's so hard to unionize a workplace. The corporations have the greater advantage here -- they buy the politicians, they choose what kind of stores to open, they choose what food is available for sale in a community, etc.

As for laying off the class warfare stuff, all I'm doing is posting about it. Do you think French workers ever just "lay off on it" and let their pay and benefits erode into servitude? Nope, they get out in the street and march with signs and bang on drums and all that. The fishermen shut down ports, and workers blockade roads. And because of their consistent civil disobedience, they've maintained one of the highest standards of living in the world. Truly universal healthcare. Lengthy vacations, guaranteed by law. Watch Moore's "Sicko" sometime, the Americans living in Paris he interviewed felt guilty that Americans back home have none of these rights.
Last edited by Sixstrings on Fri 02 Apr 2010, 23:34:16, edited 1 time in total.
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Re: The L-curve

Unread postby mos6507 » Fri 02 Apr 2010, 23:23:48

$this->bbcode_second_pass_quote('Sixstrings', '
')Mos, voters have no say about the credit policy put forth by the Federal Reserve.


So what? Nobody says you have to go into debt or buy a house. Interest rates fluctuate. That's part of life. Caveat emptor.

$this->bbcode_second_pass_quote('Sixstrings', '
')"Buy American" campaigns never work for the same reason it's so hard to unionize a workplace.


You aren't directly addressing my claim, that people are TOO CHEAP to pay for goods put together by americans for a living wage.

$this->bbcode_second_pass_quote('Sixstrings', '
')they choose what food is available for sale in a community, etc.


No, they choose to waste money on cell phones and cable TV and then complain they can't afford to buy organic.

My point is that BAU is complementary. The system has evolved to suit the public's desires, which is low prices first, and quality doesn't matter, even if it's contaminated with melamine, lead, or e-coli.

It's been a race to the bottom in which consumers have been full and willing participants. Sure, when these problems rear their ugly heads, consumers complain, but ultimately they are asking to have their cake and eat it too. It can't be done.

To attack this problem only by pointing fingers at TPTB is to ignore the larger cultural dynamics.



BTW, Michael Moore himself looks like a victim of factory farming.
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Re: The L-curve

Unread postby Sixstrings » Fri 02 Apr 2010, 23:53:03

$this->bbcode_second_pass_quote('mos6507', 'Y')ou aren't directly addressing my claim, that people are TOO CHEAP to pay for goods put together by americans for a living wage.


Well, a lot of folks are TOO BROKE to pay higher prices. It's a vicious cycle, give a man a McJob and all he'll be able to afford is McDonald's.

But you do have a point.. most of us, at least on this forum, could afford to buy more American made products. I got a can-opener for an elderly relative the other day. She has rheumatoid arthritis, so I got a $6 electric Chinese model from Walmart. To my genuine surprise, the darn thing doesn't even work. It's not faulty, the motor works and the wheel turns and all -- it just actually doesn't work by design. I tried for half an hour, and there's no way to get it to hold a can in place. The blade on it wasn't even sharp enough to pierce through if I held the can.

So I just threw it away, and went back to Walmart and got a new manual opener. Her old opener was a "Swing-Away," probably thirty years old. All I saw were Chinese can openers, so I bought one for like $4. I got curious later, as in whether Swing-Away is even still in business. Did some googling, and sure enough you can buy them on Amazon for $6 (plus shipping), and they're still made in the USA.

The Swing-Away openers have great reviews on Amazon, everyone raving how they last twenty years. So anyhow I did feel bad about that, realizing I *could* have bought American. But then again the can opener was needed ASAP, I couldn't wait for delivery on it. And it's another subject, but by ordering from Amazon you still affect American jobs since you're cutting out the retail level.

To clarify, the $6 American model was probably surplus since the highest Amazon price was $9. But even at $9, if I could have bought that at a local store I would have. You know, what we ought to have is a law requiring stores to provide an American-made alternative if it's available.
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Re: The L-curve

Unread postby mos6507 » Sat 03 Apr 2010, 00:51:00

$this->bbcode_second_pass_quote('Sixstrings', '
')Well, a lot of folks are TOO BROKE to pay higher prices. It's a vicious cycle, give a man a McJob and all he'll be able to afford is McDonald's.


The Wal-mart-ization of america started to really pick up steam in the 1990s, long before the credit crisis. Also, even today people aren't as broke as they think they are. They have more monthly expenses trailing behind them than ever. Cell phones, internet service, cable TV, videogames, etc... They have decided which things they want to spend money on and which things they don't.

Corporate america gives us what we want as demonstrated by our consumer behavior. The negative aspects are an unfortunate but unavoidable byproduct of our Faustian bargain.

$this->bbcode_second_pass_quote('Sixstrings', '
')But you do have a point.. most of us, at least on this forum, could afford to buy more American made products.


Not really. Most of us who are in the know should just be buying less, period. Another thing these presumably broke people could learn.

And if we're going to buy stuff, what's so bad about used stuff? We are a spoiled nation. We need all new everything. The volume of stuff that heads to the landfill because we're too pompous to reuse it is astounding. I saw a fair amount of that take place in my days of apartment living. People were constantly leaving stuff by the dumpster on their way out. Even though I was making good money, I wasn't too pompous to pick up another pole lamp or an old but working CRT TV for free. This is why I called my virtual character Gil Sanford, ala Sanford and Son. The reuse part of reduce, reuse, and recycle is of particular interest to me.

You see what I'm talking about here? The whole rush to point fingers at TPTB does nothing but stoke anger of the Joe Stack and Hutaree sort. It doesn't cause anybody to make important powerdown-style adaptations in their lives. The subtext of this anger is the idea that the glory days of the american dream could have persisted if not for those pesky illuminati who crashed the system, whereas any truly keyed-in doomer would realize that the end was preordained by limits to growth. Surely by now if the credit crisis hadn't taken us down, oil prices would have, and we'd have a harder time engaging in this pointless game of scapegoating.

But instead I see doomers and the tea partiers kind of ideologically drift closer and closer together.
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Re: The L-curve

Unread postby Ludi » Sat 03 Apr 2010, 06:52:07

$this->bbcode_second_pass_quote('Sixstrings', '
')Well, a lot of folks are TOO BROKE to pay higher prices.



But you said the market will solve our problems! [smilie=llorar.gif]
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Re: The L-curve

Unread postby Cloud9 » Sat 03 Apr 2010, 08:03:13

Gasoline showed us what happens to prices when demand drops. The reason prices are up is that the government is doing everything humanly possible to keep market forces from playing out. The banks would be cutting borrowers deals had it not been for the billions flushed into their coffers by the feds. They don’t need to renegotiate loans. They don’t need people to save; they have an unending supply of free money from the fed. Unions don’t need to cut deals because GM is too big to fail. Labor does not need to renegotiate wages because unemployment is infinite. Ironically, the socialist were heavily influenced by Darwinism. That influence causes them to exert every effort to prevent the forces of natural selection from playing out. As a result of their efforts, licentiousness prevails.
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Re: The L-curve

Unread postby bromius » Sat 03 Apr 2010, 08:48:31

$this->bbcode_second_pass_quote('mos6507', '')$this->bbcode_second_pass_quote('Sixstrings', '
')The super-rich are doing immense good for folks in places like Bangalore, where one outsourced American job can support 16 Indians.


And here is the role that consumers play in perpetuating that:

Lay off on the simplistic class warfare.

$this->bbcode_second_pass_quote('Sixstrings', '
')Oh, and the housing crash was not caused by "people taking loans they couldn't afford." Don't you realize this was PLANNED by the Federal Reserve? The Fed controls credit policy, period end of story.


Sorry, man, it takes two to tango.


I agree with you on this one Mos. Instead of reinvesting in our own economy, we bought the inferior quality products from oversees because it saved a few bucks in the short run. Similar thinking from both sides of the increasingly worthless coin.
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Re: The L-curve

Unread postby Ibon » Sat 03 Apr 2010, 10:44:00

$this->bbcode_second_pass_quote('mos6507', '
')But instead I see doomers and the tea partiers kind of ideologically drift closer and closer together.


That is very very true Mos. It is that despair I mentioned in my other post response to you. Despair about that which is falling away and fear about what is coming. It ties such disparate groups together.
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Re: The L-curve

Unread postby VMarcHart » Sat 03 Apr 2010, 16:36:58

I will sound like a total dick, but for the record, I am very concerned with the wealth distribution in our country.

If the poor didn't try to live like the rich, and invested in themselves instead of in products and services dispensed by the rich, the inequity would be less pronounced. For example, instead of a 56-in TV with premium cable, buy a 28-in TV with basic cable and use the rest towards an education. Instead of a Cadillac Escalade, buy a Chevy S10. Instead of pets and kids, take on jogging and reading. Replace TV, cars and pets with your own example.

I was born and raised in the left side of that football field, so I speak from experience. I was talking to grandpa this morning about how many relatives are still in the same predicament of 25 years ago when I left the house. In those 25 years, nearly all relatives could've improved their lives, but their choices of life styles got in the way.

So it is a little bit of the poor's fault for this massive inequity.
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Re: The L-curve

Unread postby Novus » Sat 03 Apr 2010, 17:56:04

$this->bbcode_second_pass_quote('Outcast_Searcher', '')$this->bbcode_second_pass_quote('efarmer', 'I') remember the good old days when they pulled a gun on you and tied you up
instead of loaning you money and letting you act like a rich fool while they were
robbing you blind.


Since when does irresponsible and/or ignorant behavior, such as borrowing money you can't afford at stupidly high interest rates, without paying any attention to the loan terms equate to being robbed? (Robbery implies with a weapon - by force).



You were robbed even if you didn't borrow a single red cent. As tax payers we were ALL FORCED to bail out the banks. The robber barrons in GS kept all the sub-price profits which made them billionaires but unloaded the costs of the failed mortages on to the tax payer. Classic wealth redistribution from poor to rich. Try not paying your taxes and see if some one puts a gun in your face. Got a problem with that then TS. America is no a longer a democracy.
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