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Category Archives: Immorality

Economics: Mostly Math or Mostly Moral?


Institutionalized Injustice:  Fighting Over Unearned Wealth [courtesy Google Images]

Institutionalized Injustice: Fighting Over Unearned Wealth
[courtesy Google Images]

Financial Times:

 

“On Friday [Nov. 6, A.D. 2015] the Bank of Japan [BoJ] revised down its inflation and growth forecasts, and pushed back its expectation of hitting the 2 per cent inflation target to the end of next year. It seems likely, and indeed desirable, that the BoJ will be forced to expand its programme of quantitative easing [QE] before too long.”

QE is intended to cause more borrowing, more spending and more inflation in whichever country/economy that promotes it.  In the case of Japan, continued reliance on QE is strange since they’ve tried to use some version of QE for most of 25 years without much success.

Why does Japan continue to beat that dead horse?  Could it be because that’s the only horse they have?  Financial Times:

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Pension Blues


Politician:  Trust Me--I'll Protect Your Pension [courtesy Google Images]

Politician: Trust Me–I’ll Protect Your Pension
[courtesy Google Images]

MarketWatch.com published “The Next Greece May be In the U.S.”.  According to that article,

 

“When Chicago Public Schools announced on June 24 that it would borrow $1 billion to make a $600 million-plus pension payment due June 30 an eerie feeling spread across bond investors and taxpayers alike.”

Get that?  The Chicago Public School system has undoubtedly already collected hundreds of millions of dollars (probably billions) from the teachers to fund the teacher pension plan.  The School system is therefore a debtor to those teachers.  And yet, that debtor sought to borrow another $1 billion to pay the part of the debt that’s due on June 30th.  How much more will be due on July 30th, August 30th and December 30th?  How much will be due this year, next year and next decade?

By borrowing $1 billion to pay existing debt, the Chicago teachers’ pension fund demonstrates that it’s already broke.  Where’s the money going to come from to pay future pension obligations?

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