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Nobody votes *for* anything anymore, only against. It’s a bit like politics has entered the equivalent of the zero-loser-bound/liquidity trap regime in economics. To act like you know what’s going on is to set a nonzero interest rate.
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One way to interpret political outcomes in the great weirding is that people seem to vote against candidates who act like they know what’s going on.
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Damn this analogy has legs. Since nobody actually has a clue, any credible political plan can on,y offer so low an “interest rate” that people prefer to hold on to their political agency by voting for “liquidity trap politicians” who offer either no plan or obvious nonsense.
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It’s a useless analogy though since nobody has really solved the economics version of the problem either. QE just pushed up stock prices without meaningfully stimulating the economy. Buying bonds without reference to interest rate is basically taking a country “private”.
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So my theory of economic side of analogy. Approaching ZLB means fundamental growth has stalled, prompting... ...QE to start taking a country private so you can pretend it still has a future... ...which allows its stock market to become solipsistic, its own reality
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Effectively causing economic agency to at once become further concentrated with incumbents AND divorced from reality in a country whose economic future has been taken private by its central bank Damn, I think I understand what happened in recession aftermath for the first time😳
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The power of the liquidity trap is diluted (heh!) by creating MORE liquidity and giving it to the central bank’s best buddies who pass it on to their best buddies to buyback stock. So nobody knows where future growth will come from, but make sure The Cronies hold all assets.
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This devalues cash holdings even if it’s under your mattress but you don’t notice because it takes the form of non-monetary capital concentration rather than visible consumption inflation. Or inflation being constrained to stock prices... by design. I think I finally get it 🤔
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Applying this to politics, voting against anyone with a plan creates a political agency liquidity trap. It’s all held in reserve, none of it deployed behind meaningful policy ideas. Tightening immigration is political QE: taking the country private by buying bonds.
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And the equivalent of stock buyback is just plain nativism 😝 Pushing up the “stock price” of “citizens” regardless of their fundamentals. Same result: political agency concentrated in incumbency absent any bright ideas about where to invest it.
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Well some progress. I’ve discovered that politics and economics are being fearful and unimaginative in exactly the same way, in tight synchronization.
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How come nobody ELI5ed this to me this way before? I’m either missing something or there’s a conspiracy of silence around the narrative here because it is so depressing.
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QE is basically a judo move executed by a central bank against the citizenry of its own country by using their own fears to weaken their stake further, by surreptitiously debasing the currency. “Oh you don’t believe enough to invest? We’ll buyback whatever investments you have”
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Edit: In this analogy, a vacuous meme like MAGA is probably like a riskier long-term bond being bought in QE ops. Immigration tightening is the stock buyback that results as a second order effect.