Do conservatives believe in Income Inequality? - Page 7 - Politics Forum.org | PoFo

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#14652518
Lexington wrote:Since I was curious, page 82

Image


The top figure, I assume, represents total assets of US banks? If I read this right, mortgages represent ~16% of their assets. Not an inconsequential number, to be sure. The value of mortgage assets (and by extension land itself) reflects the human tendency to congregate in cities. The driving force being that cities are basic economic engines of human society, with land values being a second-order artifact. It makes the most sense to address income inequality in the most direct fashion possible, rather than hoping for a trickle-down from land reform. Land reform is not end-game for a just society - it is only one available tool.
#14652526
As for bank lending:

NPR says:

(SOUNDBITE OF ARCHIVED RECORDING)

BARNEY FRANK: I think they should be abolished.

SMITH: None of these things has happened. If you've taken out a mortgage recently, chances are it went through Fannie and Freddie. The government helped you get that loan. Guy Cecala publishes Inside Mortgage Finance. I asked him what fraction of new mortgages the government is involved in.

GUY CECALA: It's about 72 percent.

SMITH: Seventy-two percent - that's a lot.

CECALA: It is a lot. It's dropped, but it's still at a historically high level.

SMITH: By dropped, he means that it used to be 90 percent, so 72 percent - that's what passes for progress. Here is what Fannie and Freddie do. If you get a mortgage, you get that loan from a bank. Fannie and Freddie buy up those mortgages from banks and slap a guarantee on them. So if you don't pay your mortgage, Fannie and Freddie will make up the difference. Fannie and Freddie take a fee for doing this, and then they sell these guaranteed mortgages to investors.
#14657043
TruthToPower wrote:mortgages are still the bulk of bank lending to private borrowers.

Lexington wrote:(fed reserve data)

TruthToPower wrote:Thanks for posting the proof that I was right: the vast majority -- about 2/3, according to your table -- of bank lending is mortgage lending.


Code: Select all>>> agencyAndGSEBackedSecurities = 6531.4
>>> mortgages = 13217.2
>>> totalFinancialAssets = 85436.8
>>> (agencyAndGSEBackedSecurities + mortgages) / totalFinancialAssets
0.23114863852578746


23%. And I'm being generous including the agency-backed securities since that includes student loans.
#14657172
TruthToPower wrote:mortgages are still the bulk of bank lending to private borrowers.

Lexington wrote:(fed reserve data)

TruthToPower wrote:Thanks for posting the proof that I was right: the vast majority -- about 2/3, according to your table -- of bank lending is mortgage lending.


Code: Select all>>> agencyAndGSEBackedSecurities = 6531.4
>>> mortgages = 13217.2
>>> totalFinancialAssets = 85436.8
>>> (agencyAndGSEBackedSecurities + mortgages) / totalFinancialAssets
0.23114863852578746

Lexington wrote:23%. And I'm being generous including the agency-backed securities since that includes student loans.

OK, so you do not even know the difference between A S S E T S and L E N D I N G.

Thought not.
#14657195


Well TTP. You just don't know who you are talking to, do you.

Well. We are used to your bullshit "statistics". Of course, un-sourced.
#14657209
Truth To Power wrote:OK, so you do not even know the difference between A S S E T S and L E N D I N G.




The debtors' liabilities are assets to their creditors. They're an asset to the point of being tradeable in financial markets.
#14657222
I find myself in the fascinating position of having my ability to read a balance sheet correctly defended by Communists and Republicans

Let us, together, explore the meaning of The Balance Sheet.

Currency and near-currency assets
The first four items are "near-currency assets", like U.S. official reserve assets (this includes some things like gold), SDR certificates (Special Drawing Rights, which are liabilities of the International Monetary Fund), treasury currency (liabilities of the United States Treasury), foreign deposits (liabilities of foreign central banks). Many of these do actually accrue interest although, like any deposit, they constitute a zero-day loan: I can put it in the bank and withdraw it the same day. Net interbank assets refers to, well, assets held between banks. If you go to page 109 in the document you can see this broken down: the vast majority is with the Federal Reserve (interest earning deposits, zero-day loans again), and smaller amounts in other institutions. Checkable deposits and currency should be self-explanatory. These too are economically zero-day loans.

Short-term deposits and funds
Time and savings deposits are again deposits, but unlike zero-day checking deposits they either have a penalty or a required period to hold them. But they earn interest and constitute lending. Money market funds shares are generally securitized forms of commercial paper (we'll get to commercial paper) and are interest earning. Functionally institutions and individuals use them as a way of earning a small amount of interest on money that could otherwise be held on deposit and still have liquidity. Federal funds are funds required by the Fed to be held in reserve at banks (interest earning); security repos are similarly a near-cash form of funding: repo is short for repurchase agreement and constitute very short-term loans (often overnight). These earn interest.

Debt securities
I can understand how someone might confuse zero-day loans as not constituting lending, and I think you got your 2/3rds figure by looking just under the mortgages/loans ratio. The thing is debt securities (look! it has debt in the name!) are clearly lending. The only difference between a debt security and a loan is an accounting and trading definition: a loan doesn't usually trade actively by itself while debt securities are actively traded.

Anyway, open market paper refers to short term debt (such as commercial paper) with a term of like three months or so. Treasury securities refers to all tradeable United States government debt - it's amusing that you would exclude this, I guess no one lends to the US government? Agency securities refers to securitized loans from Fannie Mae, Freddie Mac, and Sallie Mae - these are basically bundles of existing loans put together in a gigantic blender and sold off. As I said before, while most of these are repackaged mortgages, some (like student loan securities) are not. Municipal securities is state and local borrowing; Corporate and foreign bonds are corporate and foreign debts.

Debt securities plainly constitute lending and indeed the largest single part of the US banking system's assets. Even if we ignore zero-day loans, deposits, and short-term lending debt securities are plainly lending - the mechanism just involves openly traded debt.

Loans
Obviously lending.

Corporate equities and mutual funds
This refers mostly to ownership in corporations, either tradeable stock or private equity and ownership. (Some mutual funds will own non-equity stuff like bonds and commodities and derivatives). I suppose you could single this out as not lending, but economically it's similar: you can finance a business either by selling a piece of its ownership off in the form of stock, or you can finance it with debt. There are also hybrid forms of financing (preferred stock, perpetual debt, and various forms of convertible debt that turn into stock in certain conditions. Either way, if you divide this out from the rest of this, your original contention is meaningless: a bank's operations include both equity and debt operations and financing an operation through stock is at an economic level not meaningfully different from financing it through debt.

Miscellaneous
Trade receivables, life insurance reserves, US FDI, and most of the miscellaneous assets are interest or dividend earning. Some of the miscellaneous assets are actually real estate since banks own branches and stuff, admittedly.
#14657303
Drlee wrote::lol:

Well TTP. You just don't know who you are talking to, do you.

Argument from authority? There's a shocker, coming from you.

Not.

I couldn't care less who I am talking to. He showed that he either doesn't know that assets are different from lending, or is trying to pull a fast one on readers. Full stop.
Well. We are used to your bullshit "statistics". Of course, un-sourced.

The source was Lex's, pal: the Fed (Z1 current, lines 38-41). Try to keep your eye on the ball.
Truth To Power wrote:OK, so you do not even know the difference between A S S E T S and L E N D I N G.

KlassWar wrote:

The debtors' liabilities are assets to their creditors. They're an asset to the point of being tradeable in financial markets.

BWAHAAHAHAAHAHAHAHAHAHAAAAAAAA!!!11!1!!

So, now Captain Logic thinks the fact that all loans are assets to the creditor means all assets are loans....?

You can't make this stuff up!! Marx would be proud of you.
Lexington wrote:I find myself in the fascinating position of having my ability to read a balance sheet correctly defended by Communists and Republicans

Blah, blah, blah. All in the interest of trying to evade the fact that MAKING a loan is lending, but BUYING a loan someone ELSE has made is NOT lending. It's investing in debt instruments.

WRT government borrowing (or lending to governments), it comes in different types, the biggest one currently being federal government borrowing from the Fed. The Fed is the lender and creates the money. The private commercial banks that buy the Treasury debt instruments from the Fed are not lending, and do not create any money by buying that government debt. In our modern debt-money system, the commercial bank lender creates money by lending, but not by buying debt. That's the point.

But carry on. By now it's clear that you will say, do, and believe ANYTHING WHATEVER in order to avoid knowing the facts of objective physical reality that prove your views are false and evil.
Last edited by Truth To Power on 03 Mar 2016 20:41, edited 2 times in total.
#14657322
Truth To Power wrote:BWAHAAHAHAAHAHAHAHAHAHAAAAAAAA!!!11!1!!

Truth To Power wrote:Blah, blah, blah.

Truth To Power wrote:delete blah blah


Believe me, TTP - this is precisely how I feel when I read your posts.

Truth To Power wrote:All in the interest of trying to evade the fact that MAKING a loan is lending, but BUYING a loan someone ELSE has made is NOT lending. It's investing in debt instruments.

Truth To Power wrote:The Fed is the lender and creates the money. The private commercial banks that buy the Treasury debt instruments from the Fed are not lending


*lends TTP money*
*sells loan to someone else, to whom you still have to pay since you were the borrower*

Magically, in TTP's financial system, no loan was ever created. I guess on the bright side of this, I'm off the hook since with your fantastic understanding of finance you can default on whoever the fuck I sold your debt to.

Truth To Power wrote:and do not create any money by buying that government debt. In our modern debt-money system, the commercial bank lender creates money by lending, but not by buying debt. That's the point.


Again, false. From your last fantasy financial system I am not surprised.

Bank creates new deposits, purchases debt. See above for why your contention makes no sense.

Truth To Power wrote:But carry on. By now it's clear that you will say, do, and believe ANYTHING WHATEVER in order to avoid knowing the facts of objective physical reality that prove your views are false and evil.


See, with people that don't know much about finance, I'll work with them to understand it. I really am an understanding guy. I know that I don't know everything. I truly enjoy a discussion about things as unusual as "what is the money supply?" and "what does it mean if we have negative interest rates?" These things interest me and I don't know all the answers. But with someone who pretends to know about a subject that they apparently know little about and with tremendous arrogance asserts things again, again, and again, I have very little patience.
#14657558
Truth To Power wrote:All in the interest of trying to evade the fact that MAKING a loan is lending, but BUYING a loan someone ELSE has made is NOT lending. It's investing in debt instruments.

Truth To Power wrote:The Fed is the lender and creates the money. The private commercial banks that buy the Treasury debt instruments from the Fed are not lending

Lexington wrote:*lends TTP money*
*sells loan to someone else, to whom you still have to pay since you were the borrower*

Are you deliberately trying to mislead readers? The fact that I am still the borrower doesn't mean that whoever owns my debt is the lender.
Magically, in TTP's financial system, no loan was ever created.

I said no such thing. I stated explicitly that the loan -- and associated debt money -- was created BY THE LENDER (assuming it was a commercial bank -- ordinary private individuals and firms can't do the latter). It was self-evidently and indisputably NOT created by the buyer of the loan, as they would have nothing to buy if the loan had not already been created by the lender. That means the buyer is not the lender, as he is obviously not buying the loan from himself.
I guess on the bright side of this, I'm off the hook since with your fantastic understanding of finance you can default on whoever the fuck I sold your debt to.

You are just makin' $#!+ up again.
Truth To Power wrote:and do not create any money by buying that government debt. In our modern debt-money system, the commercial bank lender creates money by lending, but not by buying debt. That's the point.

Again, false.

No, it is correct.
From your last fantasy financial system I am not surprised.

But you can't refute a single sentence.
Bank creates new deposits,

It can only do that BY LENDING to someone.
purchases debt.

From THE LENDER.
See above for why your contention makes no sense.

I don't see anything above to support such a claim.
Truth To Power wrote:But carry on. By now it's clear that you will say, do, and believe ANYTHING WHATEVER in order to avoid knowing the facts of objective physical reality that prove your views are false and evil.

See, with people that don't know much about finance, I'll work with them to understand it. I really am an understanding guy. I know that I don't know everything. I truly enjoy a discussion about things as unusual as "what is the money supply?"

But you are unaware that private commercial banks increase the money supply by lending. Check.
and "what does it mean if we have negative interest rates?" These things interest me and I don't know all the answers. But with someone who pretends to know about a subject that they apparently know little about and with tremendous arrogance asserts things again, again, and again, I have very little patience.

<yawn>
#14657566
Speaking of yawn. Your lack of understanding is astonishing. Of course so is your ego or you would pay attention to someone who works in the very industry you are trying to discuss.

I am going with Lexington.
#14657875
Drlee wrote:Speaking of yawn. Your lack of understanding is astonishing.

<yawn> Yet as usual, you cannot refute even a single sentence I wrote.
Of course so is your ego or you would pay attention to someone who works in the very industry you are trying to discuss.

Oh, so I should listen to an apologist for bankster parasitism because he is himself a bankster....?


I am going with Lexington.

AFAICT you always prefer authority to truth.
#14657910
Yet as usual, you cannot refute even a single sentence I wrote.


It had already been done. You are just incapable of understanding it.

so I should listen to an apologist for bankster parasitism because he is himself a bankster....?


Lexington did not do that. Again. If you had the education in the subject he did perhaps you would not be so confused.

AFAICT you always prefer authority to truth


Of course this statement is absurd on the face of it. But if you are accusing me of tending to go with authority instead of some self-proclaimed messianic libertard then guilty as charged. You know, I went to school for a very long time. I did it so some day I could be the guy who knew more stuff about the subject in which I was interested. I have found that the majority of people who seek technical knowledge do that. I have learned to pay wary attention to the experts and it has served me quite well. I have seen one charlatan after another preaching with the confidence you seem to display here. One after another. They never last. You just wait them out and eventually everyone gets tired of their shit. Fortunately they are good for a laugh or two along the way. The sad thing is that there are always a few people out there who believe them. Perhaps it is their confident presentation. But smart people are not fooled by that.

You see, you might have done better if you hadn't posted the bankster bullshit. It shined a glaring light on your lack of understanding. You were all in. Done. Your argument wrecked. So you had to rely on some lame attempt to discredit the source. And it failed.

Better luck next time. Of course if you want to try to prove your....never mind. Way beyond your capabilities or you would have done it by now.

Now type a few hundred words about me. You know you can't resist. You will bluster, insult, and bluff. The thing is though that we will all know it. And that is where the laugh comes in.
#14658524
Yet as usual, you cannot refute even a single sentence I wrote.

Drlee wrote:It had already been done.

Nope.
You are just incapable of understanding it.

I've proved that's nonsense.
so I should listen to an apologist for bankster parasitism because he is himself a bankster....?

Lexington did not do that.

Sure he did.
Again. If you had the education in the subject he did perhaps you would not be so confused.

I'm not confused, and I have education -- and better yet, knowledge -- on the subject.
AFAICT you always prefer authority to truth

Of course this statement is absurd on the face of it.

Nope. It's quite accurate. Watch:
But if you are accusing me of tending to go with authority instead of some self-proclaimed messianic libertard then guilty as charged.


You know, I went to school for a very long time.

Whereas I got my degree, with honors, at age 20. Some people just take longer to learn stuff than others.
I did it so some day I could be the guy who knew more stuff about the subject in which I was interested.

Fine, as long as you are clear that it is not this subject.
I have found that the majority of people who seek technical knowledge do that.

Sure. But those who seek understanding have to take a different route that doesn't focus so much on parroting what the "authorities" say.
I have learned to pay wary attention to the experts and it has served me quite well.

Whereas I have learned that it is possible -- and for me, even fairly routine -- to disagree with "experts" and subsequently be proved right.
I have seen one charlatan after another preaching with the confidence you seem to display here.

"He who knows, and knows that he knows, is wise. Follow him."

I will leave it to readers to judge whether I am the wise man who knows that he knows, or the fool who knows not that he knows not. Your efforts are nothing but ad hominem garbage, as you are constantly on about me, but never manage actually to refute anything I have said.
One after another. They never last. You just wait them out and eventually everyone gets tired of their shit. Fortunately they are good for a laugh or two along the way. The sad thing is that there are always a few people out there who believe them. Perhaps it is their confident presentation. But smart people are not fooled by that.

Yes, well, smart people are sometimes smart enough to fool themselves (not that you necessarily qualify).
You see, you might have done better if you hadn't posted the bankster bullshit. It shined a glaring light on your lack of understanding.

Garbage with no basis in fact or logic. The term, "bankster" accurately captures the essentially non-contributory and dishonest character of what modern commercial banks do.
You were all in. Done. Your argument wrecked.

Garbage with no basis in fact or logic. My argument stands.
So you had to rely on some lame attempt to discredit the source.

No, I only refuted your lame attempt to enshrine the source as gospel. See how that works?
And it failed.

No it didn't. You said I should take Lex on faith because he's a bankster. But I decline to take him on faith for the exact same reason.
Better luck next time. Of course if you want to try to prove your....never mind. Way beyond your capabilities or you would have done it by now.

I've proved what I undertook to prove, and anyone who has been paying attention knows it.
Now type a few hundred words about me. You know you can't resist. You will bluster, insult, and bluff. The thing is though that we will all know it. And that is where the laugh comes in.

Look at what YOU have just done, sunshine. Look at what YOU have just done.
#14658583
Nice. Another wall of words and not a single shred of proof. Come back when you are ready to debate with the adults.
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