The Ultimate Vampire Resource and Directory

It's just cruel to release a trailer a year ahead of the planned theatrical release.



http://www.apple.com/trailers/sony_pictures/spider-man_3/large.html

I suspect that any casual reader will find the below entry entirely uninteresting. I am posting this here for my own purposes, for archival value.





Author: Greg Pratt (gpratt04)

Date: Sunday, May 14, 2006 3:10pm



Please select one of the 5 debates outlined in chapter 23. Based upon your reading and analysis of our study of macroeconomics I would like for you to provide your reaction. Your reaction should be based upon our reading and include your reasons.





Author: CT Thompson (cancer)

Date: Tuesday, June 20, 2006 8:01pm



I am of the opinion that for each of the 5 debates, compelling arguments exists for each side. I do not think that a total adherence to either side of any debate would be wise. That being said, I would like to focus on: The Central Bank Should Aim for Zero Inflation.



In an attempt to reduce inflationary costs, proponents argue that inflation should be reduced to zero or near-zero levels. This will require a period of deflation that results in higher unemployment and a reduction in real GDP. Proponents argue that disinflationary recessions are temporary and that the long run benefits outweigh any temporary recessions. The greatest example of this strategy in action was Paul Volcker’s monetary policies of the early 1980’s.



Paul Volcker’s period of disinflation caused the greatest recession in the United States since the Great Depression. This recession might have been far worse if the Regan administration had not been expanding aggregate demand via increased government spending (multiplier effect in action). I find it odd that page 537 of the text says, "Today, Volcker is considered a hero among central bankers."



Inflation (so long as we’re not talking about hyperinflation), or more precisely the supply of money, is not a real variable (at least in the long run). Proponents of using the Central Bank to reduce inflation propose contraction of the money supply, which depresses real GDP, which increases unemployment, all in an attempt to correct a situation that has no long term effect on real variables. Inflation does not make households poorer (Inflation fallacy). Households become poorer when they become unemployed (even if that unemployment is only temporary).



I believe that the costs incurred by reducing inflation are more substantial than the costs incurred by rising inflation (menu costs, etc). When given the choice of expanding real GDP or reducing real GDP, I would always opt for real GDP to expand. As a society it seems most beneficial to have lower unemployment even though the tradeoff is higher inflation.





Author: Greg Pratt (gpratt04)

Date: Thursday, June 22, 2006 11:10am



CT:



I appreciate both your perspective (that there are 2 valid perspectives on these 5 policy questions -- as Mankiw tries to argue) as well as your point of view on inflation.



You are correct in indicating that real GDP increases are stimulated by reductions in inflation. To clarify, increases in real GDP mean that nominal GDP must increase faster than inflation. So, it seems that your goal of increasing real GDP is really another way of arguing for reductions in inflation?



The Short Run Phillips curve argues that in the short run, reductions in inflation are accompanied by increases in unemployment. Of course, the long run is another story, but experience suggests that reductions in both inflation and unemployment are temporary.





Author: CT Thompson (cancer)

Date: Thursday, June 22, 2006 5:32pm



This debate is somewhat at odds with debate #1: Policymakers should/shouldn’t try to stabilize the economy. If you are pro stabilization (which I am in regard to deficit spending during recession) you believe that recessions have, "no benefit for society and represent a sheer waste of resources" (text, p.530).



If you follow the above line of thinking, if the central bank tries to lower inflation, the result is a depression of real GDP and perhaps a recession. Therefore, monetary policy should be pursued that increases (or at least maintains) real GDP and avoids recession (despite inflation). The exception is when the inflation rate is expanding too quickly and inflation costs (in the long run) are greater than monetary contraction costs (in the short run, unemployment, depressed real GDP, etc).



A lot of this depends upon how you define "moderate" inflation. There must be a way to plot out the long run benefits of reduced inflation versus the short run costs of monetary contraction. The policy that should be pursued is the one with the lowest overall cost.



This is mostly a theoretical position as I believe that rational expectations have a huge impact on all of the above.





Author: Greg Pratt (gpratt04)

Date: Thursday, June 22, 2006 9:26pm



CT:



You articulate the tradeoff well. Debate 1 is key, if one argues for a market solution (that is minimal government intervention in the macroeconomy a la Milton Friedman, Fredrick Hayak, or others who form the Chicago or Austrian schools) then the inflation/unemployment debate is moot. Looking at both contemporary and historical records of government interventions both domestically and abroad, the record speaks for the Friedman/Hayak school.



The Keynesean or Neo Keynesean approach or, on the monetary front, Greenspan, speaks to the position you seem comfortable with. Then the government needs to decide, in spite of Friedman's work on the Phillips Curve, which problem to "attack".



By the way, I tend to agree with you and the rational expectations school, the market is far ahead of any government, will anticipate those stabilization efforts and render them moot. Friedman and experience are convincing, the most terrifying words in the English language, in my opinion:



Hi, I'm from the government and I'm here to help you.



Outstanding post, thanks CT.

Independence is for the very few; it is a privilege of the strong. And whoever attempts it even with the best right but without inner constraint proves that he is probably not only strong, but also daring to the point of recklessness. He enters into the labyrinth, he multiplies a thousandfold the dangers which life brings with it in any case, not the least of which is that no one can see how and where he loses his way, becomes lonely, and is torn piecemeal by some minotaur of conscience. Supposing one like that comes in grief, this happens so far from the comprehension of men that they neither feel it nor sympathize. And he cannot go back any longer. Nor can he go back to the pity of men.



- from Beyond Good and Evil by Friedrich Nietzsche



It is easy to misread this passage. It should be read several times. This passage does not describe me. I have posted it because of Nietzsche's unique insight into this subject.

Date: Sun, 18 Jun 2006 10:48:41 -0700

From: Greg Pratt

To: CT Thompson

Subject: Re: Chapter 17 Quiz Question





CT:



Congratulations on your exam 3 performance. I appreciate your thoughtful, critical analysis and commentary on the discussion board.



I am assuming you already hold a degree and you are taking this class for either personal interest or continuing personal/professional growth. It is a pleasure to watch an academically mature, fully realized intellect working with economic analysis and concepts. In particular, I appreciate the critical manner that you have approached Friedman. I am looking forward to your analysis of The World is Flat.



The question below is a very, very poor one. On ocassion (perhaps more that I would like) I do not edit out the poor ones from the question bank. This one that should be deleted as, in your application of the rule of 72 does generate the answer you select. It seems that the answer key incorrectly applied the rule.



Thanks for the note and your excellent class participation. I hope you are finding benefit in both the class and your reading of Friedman.



2 additional books you might find interesting (both airplane books)



1. The Travels Of A T-Shirt In The Global Economy: An Economist Examines The Markets, Power, And Politics Of World Trade: Pietra Rivoli



2. The Wisdom of Crowds by James Surowiecki







CT Thompson wrote:



I had the following question on the Chapter 17 Quiz:





Over the last 60 years the average annual U.S. inflation rate was about



a. 3 percent implying that prices have increased 12-fold.

b. 5 percent implying that prices have increased 12-fold.

c. 3 percent implying that prices have increased 18-fold.

d. 5 percent implying that prices increased about 18-fold.





I answered "A" and I got it wrong.



First, what is the correct answer? (The text says over the past 70 years there has been a 4% rise and 16-fold increase - page 357)



Second, how is the fold increase computed? None of the answers make sense to me. If I assume a 3% rise, using the rule of 72 I get:



72 / 3% = 24 (doubling period)

60 years / 24 (the time to double) = 2.5 doubles



Am I misapplying the Rule of 72?





CT Thompson

The newest "critical update" to Internet Explorer has caused my browser to close on it's own several times over the past 24 hours.



Nice patch folks.

Ok, when I first saw the trailer for Nacho Libre (it was in a theater before seeing Mission Impossible 3), I though it looked stupid as hell. I planned on dodging it even when it hit cable.



However, their marketing campaign has now changed. They're showing different clips on TV and it actually looks stupidly funny in a Happy Gilmore kind of way. I may even go to see it in the theater this weekend.



Or maybe it's still a stupid movie and I've been brainwashed with subliminal advertising.

I'm done with these types of contests. Whining aside, I can't deal with the cheaters.



For over 2 weeks no one got past level 6. Then suddenly 4 members all have an epiphany and complete the level? It stinks...



Anyway, I'd like to thank miz for sponsoring the contest. Future contests will take a very different form.

I needed to do something new today, so I started the development of GothicRave.com.



Throwing up the website shell was the easy part. I don't know if I'll make the projected roll-out deadline of September 1st or not. There's a lot of equipment I need before Gothic Rave can start broadcasting.