More from the AVM 1996 conference anticipating today’s issues attached.
Feel free to distribute:
May I just say what a relief to find someone who truly understands what they’re talking about on the internet. You certainly know how to bring an issue to light and make it important. More people really need to read this and understand this side of the story. I can’t believe you’re not more popular since you surely have the gift.
WARREN MOSLER Reply:August 9th, 2012 at 10:28 am
It’s mind bottling to think this has been circulated (or attempted to be circulated) since 1996. I wonder how many of those portfolio managers and investment bankers squirreled away this knowledge and made a fortune trading fixed income from it.
I can’t imagine the patience necessary for Warren to keep steadily working away at spreading the information in the face of all the nay-sayers for so long. I guess that’s where building fast cars and cool boats makes for a nice diversion!
FDO15 Reply:July 31st, 2012 at 4:49 pm
@perpetual neophyte, Actually, if you invested on this advice you got crushed by falling bond yields for 12 years. More funds probably went under by reading this than made a fortune. MMT doesn’t like to mention that though. They say their stopped clock perpetual worries have predictive value. Not out here in the real world though.
WARREN MOSLER Reply:July 31st, 2012 at 5:43 pm
When I ran my funds I was always ranked first for risk adjusted returns.
Since overseeing my small bank portfolio nearly 4 years ago its returned over 60% compounded annually.
Other ‘mmt’ based funds have also excelled.
And check out the market calls on this blog as well. Been pretty good by any account.
RyanVMarkov Reply:July 31st, 2012 at 11:07 pm
Warren, how do you explain Warren Buffet’s success?
He isn’t in paradigm, although he recognizes some basic macro moments.
You called him a micro guy somewhere in the comments of your site – skilled in microeconomics. Was that enough for his success?
And I can’t ever explain to myself how PIMCO’s Bill Gross is in the position he is.
WARREN MOSLER Reply:August 1st, 2012 at 6:59 am
good stock picker and good insurance exec
Bill’s a good marketer
Save America Reply:August 1st, 2012 at 12:57 am
@WARREN MOSLER, http://kenhoma.files.wordpress.com/2012/07/image_thumb18.png?w=339&h=300
I wasn’t going to vote for Obama, but he explains all thier success, from Warren Mosler to Warren Buffet, from Grossly Mistaken to his partner el errorian. They would all be zeroes without the USA and her institutions and borg collective behind them.
I have a renewed respect for Obama now, if there is anyone that can take us to a cashless society where starfleet and her computers and experts can better allocate our resources than 400 million borgs individual purchasing decisions, it is Admiral Barack! Now if we can just get Barack to continue that line of thinking, that we all need the government to help, and we need a jobs gaurantee because none of us are self made men, what a SUCCESS mosler could claim!!
Woody Allen once said he would be NOTHING if not for modern western society and all her people behind him, that had he been born in an indian village 200 years ago he would have been scalped dead in a tribal war. Instead he gets to marry his own daughter and make successful movies! Face it, warren and his success only exist by the grace of the USA and the rest of the borg, otherwise, like woody allen, 200 years ago born in an indian village he would be nothing but a navajo bead trader exhchanging for fox hide.
Warren (mosler) is one of the few that admit the financial sector is more trouble than it is worth, and we need jobs gaurantees and policy that help all borg, and willing to make bad loans to old grannies for lawnmowers so they can be happy the last few months of their life, buffet probably shares a lot of these same values, caring about the old and less able, I would wager those values has more to do with modern society lifting them up than any one aspect of thier self directed work. They are zeroes without Obama, with Obama they can be heroes.
Erickson is in DC, he needs to get warren and Obama together to talk about return on coordination and that they need each other to be great! You didn’t build anything on your own!
perpetual neophyte Reply:August 2nd, 2012 at 10:06 am
@FDO15, Can you expound? Assuming you had a strong insight in to the difference between things like currency issuers and users (with many of the dollar-pegged nations and euro states effectively being users and the USA being an issuer), why would you have gotten crushed by falling interest rates?
A better operational understanding of sovereign debt would not have been a golden-egg laying goose, necessarily, but it seems like it would have been a big competitive advantage.
Save America Reply:July 31st, 2012 at 8:01 pm
@perpetual neophyte, @perpetual neophyte, I don’t see how anyone contributed to the world having this knowledge back in 96, statisics by very smart people show a lot of success in trading, all this alpha, is luck. All the large pension and asset managers I have read over the past 20 years say after thier funds hit certain sizes, they have to go into really esoteric investments to generate good return, even buffett says an average asset manager should be able to return 50%+ a year on a million dollars or so, try doing that with a billion or trillion dollar portfolio (sorry warren mosler) size matters.
The asian financial crisis happened a short while after this conference, bob rubin said LTCM failed because none of the monetary PHD’s believed the masters of the universe would let a nukular armed power (russia) collapse (oops), warren I think also said he got out of managing all his funds around the same time ( how clever, he bailed the sinking ship instead of going down with his peers (and customers). They had milked the system for all it was worth and the only way to win anymore was no longer to play.
Its like Bogle always said, when the profits and bonuses start getting too small or come too slow, the financial elite start coming at you the sheeple with financial “innovations” and you better hold onto your wallet!
Nothing new, the banksters make the rules, when the rules don’t maximize returns, they change them to thier benefit, INNOVATION, easy to do under fiat regimes with corrupted cronies. FDO15 is part of a culture of death, one that can’t grow, but a parasite that must feast like a vampire on the flock of sheeple. They only exist to find new ways to screw you everyday, by his own admission. Yet he has too much power and money to stop bloodsucking, even though he feels it is wrong. Never underestimate the POWER of the darkside neo ;) LOL!
Is this to have a second chance to understand does “deposits exist solely as a result of loans” mean?
chewitup Reply:July 31st, 2012 at 7:30 am
If you deposit money in your bank account, you are loaning the bank your money. It is a liability to them and an asset to you.
If the bank loans you money, it creates a deposit in your account and is a liability to you and an asset to the bank.
MamMoTh Reply:July 31st, 2012 at 10:20 am
If you deposit money in your bank account, you are loaning the bank your money
Is that it?
Then it doesn’t seem to be a deep insight of MMT or PK economics at all but common knowledge.
WARREN MOSLER Reply:July 31st, 2012 at 10:37 am
agreed. MMT is mainly CK.
WARREN MOSLER Reply:July 31st, 2012 at 8:27 am
comes under be fruitful and multiply. assets and liabilities come in pears…
FIN Reply:July 31st, 2012 at 8:35 am
you mean pairs…isn’t bernard connolly a gold bug?
WARREN MOSLER Reply:July 31st, 2012 at 10:03 am
time flies like an arrow,
fruit flies like a banana
roger erickson Reply:July 31st, 2012 at 10:47 am
I thought assets and liabilities come in peers! :)
Who is John Galt
Save America Reply:July 30th, 2012 at 11:14 pm
@Dave Begotka, Some people wait on the government to allow them to have assault rifles (so they can protect themselves from batman crazies), but you Dave Begotka! You are a self made man, why go through all that red tape, just get yourself a three DEE printer and make your own fully automatic assult rifle!
Holy CRAP! I bet the CIA boyz didn’t see that one coming, talk about empowering the citizenry with WEAPONRY! LOL!
Its on now boys, state controlled drones with missles, versus a populace with 3D printers and unlimited supply of assault rifles! Get some popcorn! The monetary “warfare” is going to be the least interesting battle coming up!
Tom Hickey Reply:July 30th, 2012 at 11:42 pm
That’s actually the right answer, Dave. “Who the hell is John Galt?” :)
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Warren B. Mosler