When it comes to understanding what's going on in the world -- and, by that, I mean the real facts and actual implications, rather than what the mainstream media normally feeds everyone -- there are a handful of subscription sites that I tune in to. For geopolitical thinking and insight, I read Stratfor and Geopolitical Futures (which was formed in the past year by the original founder of Stratfor). For finance, economics and the like, I still tune in to Bill Fleckenstein, but I also really enjoy Real Vision TV. It is a website that produces long form interviews with some of the smartest, and sometimes obscure, names in that universe. It provides a forum, versus financial television, where ideas can be fleshed and not everything is driven by catchy soundbites.
With that prelude out of the way, a very recent interview on Real Vision was conducted by Grant Williams (a co-founder of the site) with David Dredge of Fortress Investment Group. Really interesting stuff, with a few specific points that resonated and brought home the pickle that the world is in.
First off, in the context of the great boogie man, deflation, it was pointed out that over the past 40 years, there have been endless tweaks to the calculation of core inflation. And the subjects both observed that none of those alterations have ever led to a higher print. So, if the answer (as preached by central bankers and mainstream economists) to our woes really is inflation, why does it seem that over and over again, the attempt is made to refine its definition so as to bring it down.
Secondly, in a discussion about Japan, but really an insight that applies everywhere, Mr. Dredge noted that there is growing talk of helicopter money as the next step in dealing with the country's financial issues. And, really, what that evolution speaks to is an admission that monetary policy has done all that it can and it is time to turn to fiscal policy. And, out of that, the skeptical thinker should have two questions for the Japanese central banker or New York Times "economist" who is a proponent:
(1) Japan has run large fiscal deficits year after year after year since it's economy turned in the late 1980s. Are we really saying that just a little more of that is really going to make a difference?
(2) Helicopter money implies more debt on the BOJ balance sheet, more government debt, and higher fiscal deficits. If putting more assets on the BOJ balance sheet and running deficits really was the answer, especially in the case of Japan, shouldn't we have whipped this problem a long time ago?
Anyway, that's the type of stuff that allows you to see the world as it is, and not how others would tell you to see it out of convenience. Highly recommended.
