“but the rise in spending has a very solid link to healthcare services, and while that may boost GDP, so do traffic accidents. ”
So, The Broken Window Fallacy is valid after all? And to think I expected the elitist’s reaction to such headline would be to propose extending Obamacare mandatory coverage to domestic animals, fish and birds, to include dental and manicures.
Ever wonder if there’s a connection between Obamacare>mandatory wealth transfer to insurance companies>union pension annuity enhancement>big PAC and insurance company donations to their “representatives?”
Nah, couldn’t be. Such a thought would wax too ‘ Sombrero de Papel de Aluminio’ maybe?
Professor – Karl Denninger said QE will be stopped:
“The Fed is not tapering because “the economy is improving.”
It is tapering because it has to or the asset base of these firms, which is all tied up in income-producing assets with a duration match against their liabilities, is increasingly toxic and will destroy these firms if it is not halted.
These firms are far more-important to ordinary Americans and thus consumption than even the banks. They’re insurance companies of various sorts (whether declared as insurance companies or not) — including pension funds and similar.
All the hand-waving is stupid; as I pointed out a long time ago this is a matter of arithmetic and there is nothing The Fed can do to “mitigate” this sort of damage other than stop doing QE.”
Pardon my ignorance, but are you saying the insurance companies and pensions are getting their juice from Obamacare? What do you think about what Karl is saying? One commenter on his site said, “Pension and insurance funds can rent seek from their customers, contributors and taxpayers. This includes higher premiums, higher pension contributions, denied or deferred claims and bull**** legislation that artificially raises premiums.”
Another said, “In the red corner we have the banking sector and really all of Wall Street.
In the blue corner is the insurance sector and pension funds. The higher QE number, and inversely lower interest rate number, greatly favors the red corner. The referee in control of the QE and interest rate is the “Federal Reserve” who is (not so) privately on the side of the red team.”