Wednesday, June 6, 2012

We. Need two targets ..at least in a closed system prolly 4 or more

This battle of the optimal target is perhaps instructive but futile Thesis Target price movements or output movements or any one of their several proxies And you leave uncertain key variables If you target an aggregate of the two either rate of change wise or level wise Obviously the y= price index x output index Leaves an infinity of combos a hyperbolic function built of a continuum of equal area rectangle Yes I can see the use for trend line navigation over rate of speed However Knowing the targets in each trend is necessary not simply their multiplicative ---------------------- Ya two targets imply a task of consistency But so be it Assume a closed system for simplicity**** Thesis A price level target and a real out put target can both be reached By the right macronautics Price level of course requires a mark up market Output a automated injection extraction system Credit rations and terms remain passive in this set up Thesis A credit ration and terms driven stabilizer prolly reaches the same aggregates by other means and with a significantly different distribution of micro outcomes **** in the short run leaks to the surrounding system in an open economy can be compensated by upping the injections or extractions Long run ..that's where other macro targets come in Forex to balance trade and interest rates to reward or punish rentiers etc