Reposted comment from Birinyi thread. Head's up!

[metalman]

Re: Reposted comment from Birinyi thread. Head's up!

Look, that's why I suggest we have the MEMBERS decide who wins the bet, their anecdotal experiences will SURELY be able to find a clear cut answer.

your saying gold's gone up 2002 - 2008 due to inflation and in the future due to deflation.

that. makes. no. sense.

You have my theory as to what will happen, what's yours? We'll let the mmbership decide who was more correct in two years time.

because your theory is self-contradictory it's a 'heads i win, tails you lose' bet. why would i take that?

If you don't accept, what's your counter proposal?

Please note, you don't agree with my position, that I accept (DUH! that's why we are making a bet). BUT I will not change my stated position in the bet, because you don't like it. And the reason why it is carefully specified is because it is a complex dynamic. AND, I'm also not going to change my position because you are arguing for me do to so. (If you wanted that, go make a bet with yourself).

my problem with your bet is... it makes no sense.

I made a prediction, what's yours, and let's settle the terms so we can get this party started.

your prediction is self-contradictory. if you said 'housing prices fall, commodity prices rise' i'd say you were making sense. but you aren't. you're saying prices will rise in a general deflation. that's coo coo land.

BTW, (you know someone is on thin ice when they have to attack someone personally as in "Mishian".

i know... that was low.

I'm excited, cause you either know you are wrong or you are chicken, so let sort out the details already, I can already visulaize that nice 2009 DE in my hands):p

i'm frustrated because it's like making a bet with someone who says, 'i bet you the sun will come up tomorrow when it completes its next 24 hr trip around the earth'.

what we are betting on is the cause of rising prices. you say deflation... the sun revolving around the earth... i say inflation, the sun appearing over the horizon because the earth is rotating on its axis.

gold is either going to rise or fall in price between now and date we choose to close our bet, er, contest due to rising inflation that will raise the prices of gold, silver, oil, etc. as the dollar gets weaker and the fed's funny money hits the economy. ej says no later than q1 2010. good enough for me. you say bullshit.... ok.

let's use the ppi then.

PPIACO Producer Price Index: All Commodities, Monthly, Index 1982=100, Not Seasonally Adjusted


it's a broad index... raw goods, fixed goods, etc... as close to an all-goods index as you can get that the gov't doesn't screw with. why bother? TIPS ain't indexted to it...



here's my bet... PPIACO over 170 by apr 1, 2010.

if you're deflation spiral call is right, it'll be under 170.

fair enough?

[metalman]

Re: Reposted comment from Birinyi thread. Head's up!

no!

if produced goods prices are rising it's due to inflation... i win the bet.

????:eek::eek::eek:

ok. nice and slow now. are you betting on a deflation spiral or inflation?

above you say inflation... you win. everywhere else deflation... you win.

how about i just send you the coin because you've defined rising prices as deflation and deflation as inflation.

you are so confused, where to begin? go back to the place where you got these ideas in the first place... but try to understand them.

start with... Fed cuts dollar, Fire sales vs FIRE sales, Duh-flation, and Bezzle shrinks again

then... The truth about deflation

[jtabeb]

Re: Reposted comment from Birinyi thread. Head's up!

your saying gold's gone up 2002 - 2008 due to inflation and in the future due to deflation.

that. makes. no. sense.

because your theory is self-contradictory it's a 'heads i win, tails you lose' bet. why would i take that?

my problem with your bet is... it makes no sense.


your prediction is self-contradictory. if you said 'housing prices fall, commodity prices rise' i'd say you were making sense. but you aren't. you're saying prices will rise in a general deflation. that's coo coo land.




i know... that was low.
i'm frustrated because it's like making a bet with someone who says, 'i bet you the sun will come up tomorrow when it completes its next 24 hr trip around the earth'.

what we are betting on is the cause of rising prices. you say deflation... the sun revolving around the earth... i say inflation, the sun appearing over the horizon because the earth is rotating on its axis.

gold is either going to rise or fall in price between now and date we choose to close our bet, er, contest due to rising inflation that will raise the prices of gold, silver, oil, etc. as the dollar gets weaker and the fed's funny money hits the economy. ej says no later than q1 2010. good enough for me. you say bullshit.... ok.

let's use the ppi then.

PPIACO Producer Price Index: All Commodities, Monthly, Index 1982=100, Not Seasonally Adjusted


it's a broad index... raw goods, fixed goods, etc... as close to an all-goods index as you can get that the gov't doesn't screw with. why bother? TIPS ain't indexted to it...



here's my bet... PPIACO over 170 by apr 1, 2010.

if you're deflation spiral call is right, it'll be under 170.

fair enough?

I'll check and get back to you, but I think we are getting somewhere now.

BTW, a little inflation primer for you since you seem to not be able to grasp the concept.

(man you know things are screwed up when you have to explain what "inflation" is to a guy nicknamed "metalman")

So here goes, lesson starts now.

Let's say we have an economy with $100 dollars.

And let's say we have an apple tree that produced 100 apples this year (no we haven't eaten any yet and none are rotten, stay with me man FOCUS!)

In this economy people only use dollars to buy apples, that's it nothing else.

Okay now inflation is when we decide to say double the money supply such that we still have 100 apples, a tree and now $200 dollars in circulation. So in this fictional economy an apples cost would go from $1 dollar a piece to $2 dollars.

Got that? We have just demonstrated what inflation is.

Here are some examples of what inflation IS NOT.

Let's say we eat all the apples and next year we get a bumper crop of 200 apples from the same tree.

Now the price of an apple is $.50 dollars. Is this inflation, NOPE! Is this defaltion, NOPE! It's the price equilibrium of the goods available realative to a FIXED AMOUNT OF MONEY.

(Following me so far? NO! Put your hand down, you may not go to the bathroom!!)

Another example of what inflation IS NOT.

Let's way we eat those 200 apples (and get a big tummy ache) and the following year the tree only produces 50 apples.

So now the price of an apple is $2.00 dollars. Is this inflation NOPE! Is this deflation, NOPE!

It's the price equilibrium of the goods available realative to a FIXED AMOUNT OF MONEY.

Now that we have shown what inflation IS and IS NOT, let's turn our attention to deflation.

Deflation is when we burn $50 dollars in the fire pit so that we are only left with $50 dollars out of the $100 dollars that we had origionally.

So going back to our base case, if there were 100 apples and only $50 dollars (vs $100 dollars in the origional case), apples would cost $.50 Dollars.

Deflation is a reduction in the fixed supply of money.

Deflation is not a decrease or an increase in the supply of goods, IT IS A DECREASE IN THE SUPPLY OF MONEY.

Okay? Questions answered? (yes you can go to the bathroom now, class dismissed).

Please note: we did not talk about credit and it's relation to money. If you need a follow up class, please don't hesitate to ask.

[metalman]

Re: Reposted comment from Birinyi thread. Head's up!

I'll check and get back to you, but I think we are getting somewhere now.

BTW, a little inflation primer for you since you seem to not be able to grasp the concept.

(man you know things are screwed up when you have to explain what "inflation" is to a guy nicknamed "metalman")

So here goes, lesson starts now.

Let's say we have an economy with $100 dollars.

bzzzzzz. that's the silly buzzer going off.

in your $100 economy there are...

asset credit dollars... fire econ
$20 credit for housing dollars
$10 credit for buildings dollars
$10 credit for stocks and bonds

commodity credit dollars
$20 credit for student loans
$10 cash for food and drinks

cash dollars
$10 for food and drinks
$10 for other stuff you buy with cash

many kinds of money only used to buy (and potentially inflate/deflate) in the economy. in fact, hundreds of kinds of money and as many kind of things that those different kinds of money act on.

And let's say we have an apple tree that produced 100 apples this year (no we haven't eaten any yet and none are rotten, stay with me man FOCUS!)

In this economy people only use dollars to buy apples, that's it nothing else.

Okay now inflation is when we decide to say double the money supply such that we still have 100 apples, a tree and now $200 dollars in circulation. So in this fictional economy an apples cost would go from $1 dollar a piece to $2 dollars.

Got that? We have just demonstrated what inflation is.

if your economy only consisted of cash and only of apples, yes. but it doesn't. lots of kinds of money and assets/commodities and other stuff bought with it.

advice... stay away from the quantity theory of money moron sites, ok? i used to think the monetary world was flat but then i learned otherwise. i will not go back to my previous state of ignorance no matter how hard you try.

the rest of your answer follows from the false premise that all money is the same and acts on all things in the economy in the same way. patently, obviously, wrong. no wonder your definitions of inflation and deflation are so confused.

[jtabeb]

Re: Reposted comment from Birinyi thread. Head's up!

bzzzzzz. that's the silly buzzer going off.

in your $100 economy there are...

asset credit dollars... fire econ
$20 credit for housing dollars
$10 credit for buildings dollars
$10 credit for stocks and bonds

commodity credit dollars
$20 credit for student loans
$10 cash for food and drinks

cash dollars
$10 for food and drinks
$10 for other stuff you buy with cash

many kinds of money only used to buy (and potentially inflate/deflate) in the economy. in fact, hundreds of kinds of money and as many kind of things that those different kinds of money act on.

if your economy only consisted of cash and only of apples, yes. but it doesn't. lots of kinds of money and assets/commodities and other stuff bought with it.

advice... stay away from the quantity theory of money moron sites, ok? i used to think the monetary world was flat but then i learned otherwise. i will not go back to my previous state of ignorance no matter how hard you try.

the rest of your answer follows from the false premise that all money is the same and acts on all things in the economy in the same way. patently, obviously, wrong. no wonder your definitions of inflation and deflation are so confused.

I'm just trying to get you to stop laying goose eggs and come up with a mutually agreeable wager.

Do you get free crackers for all the parroting you do?

And, the PPI won't work becuase of what I point out in the above posts.

Prices changes due to supply changes does not inflation nor deflation make.

I think FDI is reasonable, after all Finster is an economist, while you and I are not. So what better arbiter of reality than an economist, I mean C'mon, what's not to like about that?

(Match Race, Match Race, Match RACE!!!!)

[jtabeb]

Re: Reposted comment from Birinyi thread. Head's up!

????:eek::eek::eek:



how about i just send you the coin

Good idea! (It's obvious that you are way out of your depth, better to cede the wager now and save some face. I concur, it's the best move for you now.)

See, we can agree on something!

[metalman]

Re: Reposted comment from Birinyi thread. Head's up!

Good idea! (It's obvious that you are way out of your depth, better to cede the wager now and save some face. I concur, it's the best move for you now.)

See, we can agree on something!

that was weak.

if you want to believe deflation comes from the gov't printing money that's your business.

1 oz $20 usa gold eagle

me: ppi > 170 apr 1, 2010.

you: ppi < 170 apr 1, 2010.

ok?

[jtabeb]

Re: Reposted comment from Birinyi thread. Head's up!

that was weak.

if you want to believe deflation comes from the gov't printing money that's your business.

1 oz $20 usa gold eagle

me: ppi > 170 apr 1, 2010.

you: ppi < 170 apr 1, 2010.

ok?

What do you not understand dude? I'm not saying that reduced supply will cause prices decreases, but that is not inflation. (Hence the apple economy and the F-22 examples to set you straight). I am not going to take a bet where you are telling me to CONTRADICT my stated position, hello?!?! that's ludicrous.

You say prices rising are inflation, I disagree and have outlined how in the real world, price rises can occur without an increase in the money supply (reduced supply, same demand).

Government money printing is inflationary IF it raises the total supply of money. But if you accept that credit can be used to buy things, just like money can, and you also accept that if the total money supply contracts (Fed prints bills at a rate slower than the rate at which credit is being withdrawn, hence a negative delta) then yeah, you get some deflation.

Don't put words in my ******* mouth okay. I've clearly stated what my position is. ( and have provided examples to help bring you up to speed)


Please clearly state WHAT YOUR POSITION IS.

No, I will not bet against myself, thanks.

[metalman]

Re: Reposted comment from Birinyi thread. Head's up!

What do you not understand dude? I'm not saying that reduced supply will cause prices decreases, but that is not inflation. (Hence the apple economy and the F-22 examples to set you straight). I am not going to take a bet where you are telling me to CONTRADICT my stated position, hello?!?! that's ludicrous.

You say prices rising are inflation, I disagree and have outlined how in the real world, price rises can occur without an increase in the money supply (reduced supply, same demand).

Government money printing is inflationary IF it raises the total supply of money. But if you accept that credit can be used to buy things, just like money can, and you also accept that if the total money supply contracts (Fed prints bills at a rate slower than the rate at which credit is being withdrawn, hence a negative delta) then yeah, you get some deflation.

Don't put words in my ******* mouth okay. I've clearly stated what my position is. ( and have provided examples to help bring you up to speed)


Please clearly state WHAT YOUR POSITION IS.

No, I will not bet against myself, thanks.

1 oz $20 usa gold eagle

me: ppi > 170 apr 1, 2010.

you: ppi < 170 apr 1, 2010.

[jtabeb]

Re: Reposted comment from Birinyi thread. Head's up!

1 oz $20 usa gold eagle

me: ppi > 170 apr 1, 2010.

you: ppi < 170 apr 1, 2010.

Ah, yes, the powerful non-response response. I can see that you have exceeded you maximal capacity for intellectual thought. Would you care to continue the discourse and actually put forth a response. Or would you like another cracker?

[metalman]

Re: Reposted comment from Birinyi thread. Head's up!

Ah, yes, the powerful non-response response. I can see that you have exceeded you maximal capacity for intellectual thought. Would you care to continue the discourse and actually put forth a response. Or would you like another cracker?

earlier you said 'now we're getting somewhere' when i suggested the ppi as the measure of the result of inflation. works for me.

now you won't even talk about it.

is there any possible way to get you to put your money where your mouth is or do we to go in circles until we throw up?

[jtabeb]

Re: Reposted comment from Birinyi thread. Head's up!

earlier you said 'now we're getting somewhere' when i suggested the ppi as the measure of the result of inflation. works for me.

now you won't even talk about it.

is there any possible way to get you to put your money where your mouth is or do we to go in circles until we throw up?

Yes, I think that I've laid out what I think is going to happen, you do the same, okay?

Then we have the membership vote for whom they think got it the most correct on the specified date July 29 2009.

Do you feel that my one sentence position is sufficient? If not, I'll work on it.

On a side note:

Damn, I really wish you were a similar age. Bravado among peers implies mutual respect. Bravado expressed from junior to senior implies disrespect. I meant none. If I saw you on the street, I would address you as Sir, as would my son.

Sir, I apologize if I have expressed disrespect towards you and please accept
my bravado for what it is, a challenge laid upon a worthy opponent.

[metalman]

Re: Reposted comment from Birinyi thread. Head's up!

Yes, I think that I've laid out what I think is going to happen, you do the same, okay?

Then we have the membership vote for whom they think got it the most correct on the specified date July 29 2009.

Do you feel that my one sentence position is sufficient? If not, I'll work on it.

On a side note:

Damn, I really wish you were a similar age. Bravado among peers implies mutual respect. Bravado expressed from junior to senior implies disrespect. I meant none. If I saw you on the street, I would address you as Sir, as would my son.

Sir, I apologize if I have expressed disrespect towards you and please accept
my bravado for what it is, a challenge laid upon a worthy opponent.

no. no. it's my fault. i act like i'm 18... so says my dear wife... who puts up with it for some reason.

[Slimprofits]

Re: Reposted comment from Birinyi thread. Head's up!

No - it WAS the "whole peak oil thing". This topic was *totally off iTulip's radar* when I joined in April 2007. One of their select members was TET, (he had a segment in the reserved forum pages, with Bart, Finster & Sapiens. TET was all about "abiogenetic oil" welling up from the earth, and in response to his posts on that, iTulip was NON-COMMITTAL. Lots of iTulip members were ON BOARD with TET, that the entire peak oil story was a big fraud, by the big oil companies, or some such nonsense. 60% or more of the iTulip opinion was solidly against peak oil, in April of 2007!

We had a long palaver about it, lots of heated opinionating got flung around, while EJ posted plenty of personal comments insisting the entire issue was a "non-event propagated by doomers". I told iTulip that they were "missing a very big story completely". My arguments with EJ and with TET, and a few others, provoked (prodded is almost more like it) iTulip editors to checking this story out "with their contacts". It was fully confirmed, and the entire Peak Cheap Oil theme got elaborated and included in short order.

Best I can recall, Metalman was on the sidelines of that discussion without much resembling a firm idea of his own whether Peak Cheap Oil was real or not. iTulip wound up with an entire Peak Cheap Oil PLANK in their PLATFORM, as a result of those arguments - where none existed before. Largely as a result of me getting in their face about it. That was then. This is now. Now we have iTulip sounding snooty about which analysts out there are "sufficiently well versed on the macro issues" to offer generic citing within the NEWS pages. You don't seem to remember all of these details Babbittd.

Lukester: "Lots of iTulip members were ON BOARD with TET, that the entire peak oil story was a big fraud, by the big oil companies, or some such nonsense."

I can't *locate* that anyone else posting at the time agreed with Tet on the origions of hydrocarbons.

There are 9 posts in all of the forums that contain the word "abiogenic." None of them are in agreement with Tet.

Lukester: "and in response to his posts on that, iTulip was NON-COMMITTAL."

http://www.itulip.com/forums/showpos...5&postcount=17

#17
07-05-07, 11:45 AM
EJ
President, iTulip, Inc.

Join Date: Mar 2006
Posts: 1,298

Re: Congress on iTulip.com

Originally Posted by Tet
There is only one outcome to this view, you'll be broke when the market hands your ass to you. I'd say $10 oil before $150 oil, there are absolutely no organic markers in oil, none. This is a point that even Peaksters realize can't be proved, oil is being extracted from over six MILES below the surface of the earth. There were no dinos, no plants, no sun producing biological goo at this depth to produce oil, good old Mother Earth is a hydrocarbon manufacturing system onto itself. Once again the Stone Age didn't end for lack of stones and the Oil Age won't end for lack of oil. The best scams certainly fool the greatest amount of bagholders.

There are several topics I refuse to debate. This is one of them. Evolution vs Creationism is another. I respect your views, but you will not change my mind. And it seems to me, that with so many obvious scams going on right under our noses, our time is better spent here trying to understand the implications of the trend toward the Third World-ization of the U.S. economy and financial system.

Lukester: "We had a long palaver about it, lots of heated opinionating got flung around, while EJ posted plenty of personal comments insisting the entire issue was a "non-event propagated by doomers."

That is false. EJ said that an "economic crash with ox drawn cars" was a non-event propagated by doomers.

Your response was the following:

Truthfully, this interpretation is nowhere to be found in what I've posted. If you percieve the issues I posted to be embellished with descriptions of ox drawn carts you may be imagining (seems JK did also) a level of fantasy or agitation in me that is manifestly not there...

[..]

My intent in the posts above was that by noting the gap in scale between petroleum analysts statements on production growth, and the implied trajectory of 50 year charts of global oil consumption, this limited set of data might then be worth your adding to the "non-specialist" message box at iTulip. Do you grant even lay observers can put two simple and verifiable pieces of confirmed data together and discern the same conclusions as would the specialists?

There was no direct response from EJ and you've equated that lack of a response with EJ saying peak oil is a non-event. That is false:

EJ in 2006, from Energy & Money Part II, July 19, 2006:

http://www.itulip.com/forums/showthread.php?t=108

Peak Oil. Whether you believe that an End of the World crisis is coming or not, there’s general consensus among experts that all the oil that nature provided us that was easy and thus cheap to dig out of the ground, no matter how clever we get at doing it, has already been dug up.

EJ On June 6, 2007:

http://www.itulip.com/forums/showpos...59&postcount=1

Peak Oil: Oil production is peaking. However, the event will not by itself cause economic catastrophe.

EJ in DIRECT RESPONSE TO YOU on November 1, 2007:

http://www.itulip.com/forums/showpos...40&postcount=4

No argument that oil is not either at or close to a peak of production. Lack of acknowledgment of a peak makes for a rougher ride down the other side of the curve, but does not mean catastrophe. The world economy will adjust to much higher energy prices in a series of moderate shocks. Demand will decline. Conservation will increase rapidly. Alternatives will we be developed.

farther on within the same thread, the ox-drawn cart conversation:

http://www.itulip.com/forums/showpos...0&postcount=38

I'm telling you there will not be a Peak Oil economic crash with ox drawn cars.

EJ on November 7, 2007, in a full commentary - Review of iTulip policy on Peak Oil: Evidence and Implications:

http://www.itulip.com/forums/showthr...9312#post19312

We are starting a new thread to launch a fresh discussion among our petroleum industry experts and others with the objective of deciding our policy on Peak Cheap Oil (vs Peak Oil) and the implications going forward.

Peak Oil is two issues:

1) Is oil supply peaking?
2) If so, what will be the impact?

To kick off the discussion, we've attached the recently released presentation by Matthew Simmons on Peak Oil. Simmons, as many readers know, has been a leading figure in Peak Oil circles for many years. Peak Oil naysayers view him as talking his book, that is, in order to sell his investment bank's services he makes the argument both that oil has peaked and that the dire impact is already arriving.

To restate iTulip's current position on Peak Oil:

1) Oil is a finite, non-renewable resource. At some point oil supply will peak.

2) We will not "run out of oil." As we stated in our May 4, 2006 article Energy and Money: "We have plenty of oil. But we're running out of cheap oil and there are no cheap alternatives."

3) As oil prices rise, the oil-based economy will adjust. If the rise is gradual, it will adjust slowly. If it rises quickly, the economy will adjust via a series of shocks.

4) Shock change to rapidly rising oil prices is not disaster, unless the political response is war.

your response:

http://www.itulip.com/forums/showpos...1&postcount=64

YOU - (and here I'm addressing this to all iTulip readers who are apathetic on resource depletion issues) discuss those topics, like derivatives, merely out of fascination to understand them. This is the hobby that interests you. The fact a pressing need is discerned here to "figure out what to do about this peak oil pain-in-the-ass topic" and (gratefully) move on to (yet more) discussion of defauting lenders and (yet more) derivatives is merely a way of saying, that this entire topic about 3 billion people about to appropriate your future gasoline supply and strand your ass in some wretched ubiquitous suburb is only marginally interesting to you.

[raja]

Re: Reposted comment from Birinyi thread. Head's up!

that was weak.

if you want to believe deflation comes from the gov't printing money that's your business.

metalman,

Can you help me understand a point on the deflation debate?

I have heard that all the money that the gov't is printing is being used to replace the banks' disappearing assets and to pay interest. None is going to the American consumers. If this is the case, we would not have inflation caused by too many dollars chasing a limited amount of products.

Regards cost-plus inflation, many industries are affected by the cost of energy. But is it correct that the oil producers do not have the same input costs because their product is energy, so they can, to a large degree, set any price they want for their oil? That being the case, would they reduce the cost of oil if demand went down due to the economic slowdown?

Repatriation of dollars is cited as a cause of inflation, but it seems to me that repatriation would only happen if inflation came first. In other words, why would dollars be dumped if there is no inflation occurring?

Appreciate your opinion on this . . . .

(By the way . . . although some people complain, I find your reminders about previous EJ/Fred posts to be very helpful . . . and appropriate.)