Suck it Boeing
https://www.usatoday.com/story/travel/flights/todayinthesky/2018/01/26/international-trade-commission-bombardier-boeing-delta-air-lines/1059286001/

I don't understand why Boeing didn't buy Bombardier...

Seriously, fuck Boeing. If you can't make a competing product, don't get salty and sue.

Fortunately they were already doing a go-around by the time ATC noticed, a few seconds later would have been a disaster. Their minimum altitude was reported as 18m, which is a bit under a metre above the tail height of a Boeing 787-9.

They do have those alarms, but it was initially reported this plane was too far off course from R28R to trigger them and part of the investigation will be whether they were even operating at the time.

A major contributing factor for this incident was that the second runway, 28L, was closed and lights off at the time of the incident. As a result, the FAA has changed San Francisco landing procedures no longer permitting visual approach when an adjacent parallel runway is closed - https://www.flightglobal.com/news/articles/faa-changes-san-francisco-landing-procedures-after-a-440380/

15:05-15:30: you tell Mr and Mrs Front-Porch that your loonie of 1871 cannot be compared to your loonie of 2013 (year of this interview). You went off the gold standard in '33, you abandoned the peg in '70, and your currency has been free-floating ever since. Yes, the ratio of debt to GDP has some importance, but so does the nature of your currency. Just look at Greece and Japan, where the former uses a foreign currency and the latter uses its own, sovereign, free-floating currency.

Pay back the national debt -- have you thought that through?

First, the Bank of Canada is the monopolist currency issuer for the loonie, so explain to me in detail just how the issuer of the currency is supposed to borrow the currency from someone else? If you're the issuer of the currency, you spend it into existence, and use taxation as a means to create demand for your currency, and to free resources for the government to acquire, because you can only ever buy what is for sale.

Second, every government bond is someone else's asset. An interest-bearing asset. A very safe asset, in the case of Canada, the US, the UK, Japan, etc. "Paying back the debt" means putting a bullet into just about every pension fund in the world that doesn't rely exlusively on private equity or other sorts of volatile toilet paper.

There's a distributional issue with these bonds (they are concentrated in the hands of the non-working class, aka the rich), no doubt about it. But most of the other issues are strictly political, not economical.

What if the interest rate rises 1%? The central bank can lower the interest rate to whatever it damn well pleases, because nobody can ever outbid the currency issuer in its own currency. Remember, the central banks were the banks of the treasuries. The whole notion of an independent central bank was introduced to stop these pesky leftists from spending resources on plebs. That's why central banks were often removed from democratic control and handed over to conservative bankers. If the Treasury wants an interest rate of 2% on its bonds, it tells its central bank to buy any excess that haven't been auctioned off at this rate. End of story.

What if the market stops buying government bonds? Then the central bank buys the whole lot. However, government bonds are safe assets, and regulations demand a certain percentage of safe assets in certain portfolios, so there is always demand for the bonds. Just look at the German Bundesanleihen. You get negative real rates on 10 year bonds, and they are still in very high demand. It's a safe asset in a world of shitty private equity vaporware.

But, but.... inflation! Right, the hyperinflation of 2006 is still right around the corner. Just like Japan hasn't been stuck near deflation for two decades, and all the QE by the BoE and the ECB has thrown both the UK and the Eurozone into double-digit inflation territory. Not! None of these economies are running near maximum capacity/full employment, and very little actual spending (the scary, scary "fiscal policy") has been done.

But I'm going off track here, so.... yeah, you can pay back your public debt. Just be very aware of what exactly that entails.

As for the poster-child Latvia: >10% of the population left the country.

Here's a different poster-child instead, with the hindsight of another 4 years of austerity in Europe after this interview: Portugal. The Portuguese government told Master of Coin Schäube to take a hike, and they are now in better shape than the countries who just keep on slashing.

On a different note: Marx was wrong about the proletariat. Treating them like shit doesn't make them rebellious, it makes them lethargic. Otherwise goons like Mario Rajoy would have had their comeuppance by now.

PS: Blyth's book on Austerity is an absolute must-read for anyone interested in its history or its current effects in particularly the Eurozone.

YEA Trump is a poor man flying in at cheap ass ( $100 Million) Boeing 757 at will that cost about $9000/ hr to operate.

Yep most dumb people have their own private plane.

Yea hes fucking dumb. He could just buy a ticket like the rest of us.

Zero evidence yet to be produce just media hype and falsehoods.

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Goddamn I love a good ol'-fashioned melt-down, followed by an incoherent, spittle-flecked rant!

That said, I woulda been off that Boeing so fucking fast there would have been a sonic boom.

I identify as a Boeing AH-64 Apache Longbow, my proper personal pronoun shall be "BOOM! HEADSHOT!!!"

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Perhaps it would have been better to say that fuel isn't the only reason. The Airbus A320 in this example has roughly 55% better fuel efficiency than a pre oil crisis Boeing 707, although as Jimbo's big bag'o'trivia points out, that's barely better than the 1950s era prop planes like the Douglas DC-7.

Better automation has also allowed the A320 to reduce the staffing requirements, the 707 required 3 or 4 crew to operate the aircraft, but the A320 only requires 2. The DC-7 also requires 3 crew, but only seats half the passengers (doubling the flight crew costs per passenger).

Greater competition is probably a larger factor. Talking about airline profitability and competition, Warren Buffett joked that had a farsighted capitalist had been present at Kitty Hawk for the Wright Brothers' first flight, he would have done his successors a huge favor by shooting Orville down.

Well, cheers for sticking with it anyway, I really appreciate it.

It's a one hour talk on the deficit in particular, and most of what she says is based on MMT principles that would add another 5 hours to her talk if she were to explain them. With neoclassical economics, you can sort of jump right in, given how they are taught at schools and regurgitated by talking heads and politicians, day in and day out. MMT runs contrary to many pieces of "common sense" and since you can't really give 10 hour talks everytime, this is what you end up with – bits and pieces that require previous knowledge.

I'd offer talks by other MMT proponents such as William Mitchell (UNSW), Randy Wray (UMKC) or Michael Hudson (UMKC), but they are even less comprehensible. Sorry. Eric Tymoigne provided a wonderful primer on banking over at NEP, but it's long and dry.

Since I'm significantly worse at explaining the basics of MMT, I'm not even going to try to "weave a narrative" and instead I'll just work my way through it, point by point.

@notarobot

"Let's address inequality by taking on debt to increase spending to help transfer money to large private corporations."

You don't have to take on debt. The US as the sole legal issuer of the Dollar can always "print more". That's what the short Greenspan clip was all about. Of course, you don't actually print Federal Reserve Notes to pay for federal expenses. It's the digital age, after all.

If the federal government were to acquire, say, ten more KC-46 from Boeing, some minion at the Treasury would give some minion at the Fed a call and say "We need $2 billion, could you arrange the transfer?" The Fed minion then proceeds to debit $2B from the Treasury's account at the Fed (Treasury General Account, TGA) and credits $2B to Boeing's account at Bank X. Plain accounting.

If TGA runs negative, there are two options. The Treasury could sell bonds, take on new debt. Or it could monetise debt by selling those bonds straight to the Fed – think Overt Monetary Financing.

The second option is the interesting one: a swap of public debt for account credits. Any interest on this debt would be transfered straight back in the TGA. It's all left pocket, right pocket, really. Both the Fed and the Treasury are part of the consolidated government.

However, running a deficit amounts to a new injection of reserves. This puts a downward pressure on the overnight interest rate (Fed Funds Rate in the US, FFR) unless it is offset by an increase in outstanding debt by the Treasury (or a draw-down of the TT&Ls, but that's minor in this case). So the sale of t-bonds is not a neccessity, it's how the Treasury supports the Fed's monetary policy by raising the FFR. If the target FFR is 0%, there's no need for the Treasury to drain reserves by selling bonds.

Additionally, you might want to sell t-bonds to provide the private sector with the ability to earn interest on a safe asset (pension funds, etc). Treasury bonds are as solid as it gets, unlike municipal bonds of Detroit or stocks of Deutsche Bank.

To quote Randy Wray: "And, indeed, treasury securities really are nothing more than a saving account at the Fed that pay more interest than do reserve deposits (bank “checking accounts”) at the Fed."

Point is: for a government that uses its own sovereign, free-floating currency, it is a political decision to take on debt to finance its deficit, not an economic neccessity.

"Weimar Republic"

I'm rather glad that you went with Weimar Germany and not Zimbabwe, because I know a lot more about the former than the latter. The very, very short version: the economy of 1920's Germany was in ruins and its vastly reduced supply capacity couldn't match the increase in nominal spending. In an economy at maximum capacity, spending increases are a bad idea, especially if meant to pay reparations.

Let's try a longer version. Your point, I assume, is that an increase in the money supply leads to (hyper-)inflation. That's Quantity Theory of Monetary 101, MV=PY. Amount of money in circulation times velocity of circulation equals average prices times real output. However, QTM works on two assumptions that are quite... questionable.

First, it assumes full employment (max output, Y is constant). Or in other terms, an economy running at full capacity. Does anyone know any economy today that is running at full capacity? I don't. In fact, I was born in '83 and in my lifetime, we haven't had full employment in any major country. Some people refer to 3% unemployment as "full employment", even though 3% unemployment in the '60s would have been referred to as "mass unemployment".

Second, it assumes a constant velocity of circulation (V is constant). That's how many times a Dollar has been "used" over a year. However, velocity was proven to be rather volatile by countless studies.

If both Y and V are constant, any increase in the money supply M would mean an increase in prices P. The only way for an economy at full capacity to compensate for increased spending would be a rationing of said spending through higher prices. Inflation goes up when demand outpaces supply, right?

But like I said, neither Y nor V are constant, so the application of this theory in this form is misleading to say the least. There's a lot of slack in every economy in the world, especially the US economy. Any increase in purchases will be met by corporations with excess capacity. They will, generally speaking, increase their market share rather than hike prices. Monopolies might not, but that's a different issue altogether.

Again, the short version: additional spending leads to increased inflation only if it cannot be met with unused capacity. Only in an economy at or near full capacity will it lead to significant inflation. And even then, excess private demand can easily be curbed: taxation.

As for the Angry Birds analogy: yeah, I'm not a fan either. But all the other talks on this topic are even worse, unfortunatly. There's only a handful of MMT economists doing these kinds of public talks and I haven't yet spotted a Neil deGrasse Tyson among them, if you know what I mean.

Just watching this video made me nervous, but I think I could do it in real life, assuming a pilot was giving instructions over the radio.
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I had a conversation with a commercial pilot before (at dinner, not in a flight) and he had flown both Boeing and Airbus and said they feel much different. Boeing spends a lot of time with the force-feedback so the planes behave much the same as their older analog counterparts, and lays things out based on pilot feedback ; whereas Airbus feels more like a video game, and they only care about fuel efficiency of the plane.

Either way, all pilots require hundreds of hours of training on a particular model (of large commercial airplane) before they get to be captain.

I haven't been following Krugman's column/blog for quite some time, but every once in a while, a piece of his makes its way onto my screen. And his recent takes on HRC/Sanders/Single Payer reminded me that he's a member of the establishment first and foremost.

Many point out how his views of the electability of Sanders vs HRC are eerily similar to what he wrote in '08 about Obama vs HRC. I'd say it even has a touch of Attlee vs Churchill in it. Winston was bound to win the election in '45, beyond any doubt, so Attlee decided not to pretend to be Churchill light, but went all in with socialist ideas. NHS, largescale nationalisation incl the BoE, free secondary education, massive public housing, a focus on full employment, social security, etc -- ten times more radical than anything Sanders even proposed.

48% to 36% - a landslide victory, thank you very much.

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