dagblog - Comments for "What goes up, must come down ...."

Nice post, D. I don't know

Michael Wolraich — Thu, 18 Dec 2008 20:15:00 +0000

In reply to What goes up, must come down ....

Nice post, D. I don't know enough to comment myself, so I wrote to a wise econ professor I know. He had the following to say:

The Yin-Yang Theory of Economics, first proposed in 87 B.C. by the noted Chinese economist and philosopher, Dr. Yinga Yanga, is widely accepted throughout Asia. By contrast, a related hypothesis, the What-Goes-Up-Most-Go-Down Theory of Economics developed by a John Bear, a disciple of Adam Smith, has been largely ignored and occasionally ridiculed by Western economists, investors, and pretty much everyone except for those few dour souls who spent the 90's whining about inadequate PPEs.

Broadly interpreted, both theories, have effectively predicted historical economic cycles, insofar as economic growth throughout the world has repeatedly gone up-and-down-up-and-down like a drunken sin wave. But as predictors, these theories are hardly precise. While there is certainly a yang for every yin, sometimes the yin kicks yang butt or vice-verse.

I recommend the Hangover's Suck Ass Theory of Economics, developed by 18-year-old prodigy John Blutarsky one bleek Sunday morning last year. This theory offers a correction to the standard Yin-Yang model. While it acknowledges that you cannot party without a hangover, economically speaking, the pain and duration of the hangover cannot be predicted. Based on that assumption, he argues persuasively that when the party's over, you should quaff water like a parched elephant because you never know if the next hangover will reduce you to a pathetic mound of quivering jello, economically speaking.

Thanks Mort-dog for the

Deadman — Thu, 18 Dec 2008 19:31:07 +0000

In reply to I do love when you blog on

Thanks Mort-dog for the props, tho I gotta tell you I am SICK of writing about the economy and only do it when the outrage reaches that magical boiling point.

What's really be getting me is that nearly all of the economists and pundits I've been hearing have been suggesting that all this stimulus is necessary, and we'll worry about the consequences later.

Frankly, everyone is using the '30s as the blueprint for what not to do and what to avoid. No one wants to go down as a Hoover, as someone who did nothing to try to stimulate the economy or mitigate the pain and suffering of Americans.

That may be the right tack to take, but I know that the world is a lot different than it was back then. The enormous size of our deficits, the dramatic extent of our bubbles, the global reach of the crisis, all have their own unique qualities that will likely make whatever happens next different than what happened then.

And these are the same economists and pundits who had NO FRIGGIN CLUE that shit was about to hit the fan. Gimme the name of 10 economists from last summer who predicted we were about to enter the worst downturn since The Great Depression.

Yet we are supposed to have faith that they will outsmart the market, and allow us to have lots of yin and very little yang??

We're not addicted to

Orlando — Thu, 18 Dec 2008 16:51:49 +0000

In reply to I do love when you blog on

We're not addicted to spending or to things. We're addicted to instant gratification. That's why we don't save money. That's why we buy whatever we want, whenever we want it. That's why investors aren't adopting a wait and see attitude and the markets make Six Flags look like the kiddie rides at the state fair.

What's the solution? How can we teach ourselves to be patient again when we've spent the last twenty years behaving like spoiled children? Maybe Obama needs to give us all a lengthy time out.

I do love when you blog on

Mortimus — Thu, 18 Dec 2008 15:49:24 +0000

In reply to I wonder if there will be

I do love when you blog on this stuff. In response, welcome to the 21st century. Everything is bigger, faster, stronger and will progressively continue to be more so. The Red Bull souped up, multi-tasking, all-knowing, all sensors stimulated culture will not stand for slow growth or deterioration. Everything must be swift, painful and historic. 35% down days, 28% up days, 3 million monthly job cuts, $4 trillion stimulus packages I'm afraid are going to become the norm. Time is becoming increasingly valuable, too valuable for tedious L-shaped recessions. Our ability to handle these swings quickly and effectively will either become an evolutionary step or lead to our ultimate downfall. All-or-nothing, just how we've come to like it.

I wonder if there will be

Donal — Thu, 18 Dec 2008 15:16:03 +0000

In reply to What goes up, must come down ....

I wonder if there will be much of a recovery.