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latest user's comments
|#54 - The financial crisis of 2008 happened because of de-regulation…||02/24/2016 on How to Stimulate an Economy||0|
|#51 - don't forget those Keynesian fiscal multipliers [+] (1 new reply)||02/24/2016 on How to Stimulate an Economy||0|
#55 - xfz (02/24/2016) [-]
I did not. I did not say that the increase in GDP equals the spending, just that it goes up. I will not lie to my FJ family, but if I should specify everything it would be rediculous.
For example, countering the keynsian multipliers you mentioned, increased interest rates would work agains the purpose, and make the policy less efficient. Anlong with this, in the purpose of counter-cyclicality, all spending is not equal, since spending in different sectors will bear fruits in terms of technological advancement in different periods. If you invest in a road, the advancement direcly connected to the road only takes place when the road can be used. And alongside this, one could argue that with government spending, GDP is a bad tool, since the spending is valued in terms of it's cost and not properly priced on a market. If the government spends money on something that costs a million, but which we somehow know is useless to everyone, the direct effect (before multipliers and crowding out) effect on GDP will be a million, even though the correct number should be zero.
I hope this zoom-in shows why I did not specify everything, then it would be a silly amount of text.
|#50 - Nope, government spending incurs the Fiscal Multiplier to have…||02/24/2016 on How to Stimulate an Economy||0|
|#49 - The large majority of government spending goes into salaries, … [+] (2 new replies)||02/24/2016 on How to Stimulate an Economy||+1|
#52 - anon (02/24/2016) [-]
No, that's called fudging numbers. GDP is just a number, it's meaningless if you intentionally create policy to just make the number bigger. You can't create wealth by moving money around, you just cause money to be invested in one thing rather than the other. Which creates market bubbles and extreme instability. How do you think the financial crisis in 2008 happened?
#54 - buschmasteracr (02/24/2016) [-]
The financial crisis of 2008 happened because of de-regulation of banks basically trading gigantic packages of mortgages for money. The majority of banks had large amounts of their capital invested in housing mortgages, which they thought were safe. When the housing market collapsed, their capital essentially vanished, which left them unable to provide withdrawals for the huge majority of their clients. Due to this, bailout packages were given by the government.
GDP is the sum of all economic production in an economy, higher GDP always increases the standard of living for the entire population. It can't be "fudged" to show a false statistic, unlike the Big Mac Index or other proprietary stats.
Did you even read the paper I linked?
|#47 - Forgot to link this.||02/24/2016 on How to Stimulate an Economy||0|
|#46 - It's complete BS. Government spending has a "multiplier&q… [+] (2 new replies)||02/24/2016 on How to Stimulate an Economy||0|
#56 - kanadetenshi (02/24/2016) [-]
>Taking Fiscal Multipliers seriously
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|#35 - And anyone who wants to see more mtb content should check out …||06/08/2015 on Bike vs Bike||0|
|#47 - This is one of the weirdest updates yet, with a LOT of undocum… [+] (1 new reply)||06/12/2014 on go home valve, ur drunk||+1|