Higher Inflation OR Higher Unemployment Which do you prefer?

[chuck22b]

Originally Posted by mojo_1979

How does a slowing global economy result in less demand for food and energy to serve the ever-growing world population?

The US actually exports tons of food stuffs... here's a chart from the USDA that shows 5 year, current year, and previous year "exports" of food stuffs.

Looks like it's slowing down... likewise... price mechanisms when demand fall?


Export Sales Data Query

Likewise, look at the commodities "futures" market:

http://www.bloomberg.com/markets/com.../cfutures.html

-chuck22b

[mojo_1979]

Originally Posted by chuck22b

The US actually exports tons of food stuffs... here's a chart from the USDA that shows 5 year, current year, and previous year "exports" of food stuffs.

Looks like it's slowing down... likewise... price mechanisms when demand fall?


Export Sales Data Query

Likewise, look at the commodities "futures" market:

Bloomberg.com: Commodity Futures

-chuck22b

"Food Stuffs" -- Is that what McDonalds makes their hamburgers out of?

[Wild Style]

Originally Posted by chuck22b

I'm in the camp that thinks we're in a deflationary environment. The demand destruction as a result of business and household contraction would lower the price of almost all goods and services.

Medical maybe not (since the demand is increasing faster than demand)... but food, gas, and even utilities I can see it go down in price. Less use (reduced demand)... but increasing availability/supply (drilling, opec maintaining production, alt. energy coming online, efficiency increases in farming...etc.). China and the global economy is also slowing. So the price mechanisms of supply and demand looks deflationary.

IF, there was a bailout... and the government ops to print more money instead of raising taxes... then we'd have an inflationary environment.

-chuck22b

They will and we will.

[chuck22b]

Originally Posted by Wild Style

They will and we will.

Hi Wild,
I actually watched that video you told me to watch in that other thread.... interesting. But, I'm still waiting for you to come up with the "ideal" system for increasing/decreasing the money supply. I don't think gold is it.

Perhaps if the Fed has even more oversight? or if terms are shorter? and Fed members are elected by Congress? instead of appointed by the President?

Live video feed of the fed meetings? Ability to impeach Fed members? Who knows... I do believe we have a better setup than the gold backed system... but... I also agree that we need more oversight and checks and balances over the Central Banking system. Things like what happened in the last decade shouldn't have even had a chance to happen.

-chuck22b

[hindsight2020]

You folks overrate the marginal benefit of underemployment. I rather have higher unemployment in the short term (would take about a decade logarithmically diminishing) if it means we get serious about monetary and fiscal policy change, not to mention re-hashing our attitude towards our currency. This option will create enough deflationary pressures long-term so that everything from houses to cars to energy costs will lower in price, to a point where things are in line with median individual incomes (a la 1950's) but in this case we opt for incentivizing a real-goods producing economy, not the status quo of crappy service economy jobs abound where people are told to afford their inflated lifestyles on bad paper.

It's painful, but has to happen. I welcome net population loss in the short term, we've got to curb our artificially propped up growth, it's choking us. Everything from immigration to the moral hazards of considering the american dream an entitlement, instead of a fantasy, would temper themselves. But this can only work if we bring our collective effort as a country towards a different system, and we stop drinking the globalization kool-aid as if we had to blindly abide by its tenants in all aspects of our economic lives.

Do I expect my countrymen to have such fortitude so as to accept the re-setting? Not really; while I may be able to convince some on here of the value of letting the paper house burn, I may not be so lucky in convincing other americans to let go off the economic system that allows them to live on borrowed time and money, provides them with an ever inflationary currency, overpriced goods and services, just so they can smile in public yet fret at night, cowardly wishing every night to the house fairy that their paper dreams don't collapse before their Maker comes, and certainly not before our global bookies come to collect.

The bailout not passing was a good thing, I don't expect that outcome to repeat itself though, but I rather live in a country going through the strife of higher unemployment (constriction pains) looking towards a future where everybody including the household cat doesn't HAVE to go to work to afford a loaf of bread as we're currently heading towards; a country where people actually hold jobs that produce real wealth, strengthen our country's infrastructure (we've been there before) and directly impact our country's financial assest stability in the world market (again kinda like the 50s without the social backwardness). A country with less ipods and consumer trinkets on Xmas, but a national savings rate (of a solid dollar now mind you) that's a little above ZERO!

People are too focused on the today (it's not like americans haven't been accused before of having a short term memory), which is exactly how you get americans' attention. Fortunately today is FINALLY here and there's no hiding now. The ponzi scheme has finally been voiced out in public, with enough people listening. How long it takes us as a country to go from the economy we have today to a REAL and solvent economy will directly depend on how fast we want to let go off the dream and build upon our REAL future. I suspect many in our country will, as always, take the blue pill and pray for more bubbles and propping, particularly among those nearing retirement. But I really do hope we are more hardened like our predecessors, and choose the red pill. We'll see. Merry early effing Xmas 2008 I know that much.

[Nor'Eastah]

Originally Posted by chuck22b

Perhaps if the Fed has even more oversight? or if terms are shorter? and Fed members are elected by Congress? instead of appointed by the President?

This is crazy! You are talking about a private banking cartel here...one that issues shares only to other private banks! They don't have to put up with our "oversight". Reporting to Congress and letting the Prez appoint a Fed chief from a pre-vetted list are just jokes to these people!

Originally Posted by chuck22b

Live video feed of the fed meetings?

Likewise. AS IF a private corporation is going to allow "live video feed" of its meetings!

Originally Posted by chuck22b

Ability to impeach Fed members?

You cannot impeach them. They are not elected, and not answerable to the public.

Originally Posted by chuck22b

Who knows... I do believe we have a better setup than the gold backed system... but... I also agree that we need more oversight and checks and balances over the Central Banking system. Things like what happened in the last decade shouldn't have even had a chance to happen.

-chuck22b

And when in your lifetime have you tried a gold-backed system?

You cannot have more oversight or checks and balances over ANY central bank. They are all private corporations. They do not answer to us.

I agree that we should not have to put up with their shenanigans, but first you have to know your enemy. I guess you don't, yet.

[Wild Style]

Originally Posted by chuck22b

Hi Wild,
I actually watched that video you told me to watch in that other thread.... interesting. But, I'm still waiting for you to come up with the "ideal" system for increasing/decreasing the money supply. I don't think gold is it.

Perhaps if the Fed has even more oversight? or if terms are shorter? and Fed members are elected by Congress? instead of appointed by the President?

Live video feed of the fed meetings? Ability to impeach Fed members? Who knows... I do believe we have a better setup than the gold backed system... but... I also agree that we need more oversight and checks and balances over the Central Banking system. Things like what happened in the last decade shouldn't have even had a chance to happen.

-chuck22b

Dude lol I agree with you man trust me lol I don't think gold is it either. Give me some time man. I am going to stop coming here for awhile. I am going to take some months out to do some studying. Then I will be in a better place to say what I think would make a better system. Its coming, be patient lol

[chuck22b]

Originally Posted by hindsight2020

You folks overrate the marginal benefit of underemployment. I rather have higher unemployment in the short term (would take about a decade logarithmically diminishing) if it means we get serious about monetary and fiscal policy change, not to mention re-hashing our attitude towards our currency. This option will create enough deflationary pressures long-term so that everything from houses to cars to energy costs will lower in price, to a point where things are in line with median individual incomes (a la 1950's) but in this case we opt for incentivizing a real-goods producing economy, not the status quo of crappy service economy jobs abound where people are told to afford their inflated lifestyles on bad paper.

Why can't we have incentives for production capacity now? Why do we have to wait for a collapse to do the right thing?

It'll take some reworking of tax codes, trade agreements to promote "fair" trade, take away the tax breaks for companies that outsource, tax credits for job creation, etc.

It's painful, but has to happen. I welcome net population loss in the short term, we've got to curb our artificially propped up growth, it's choking us. Everything from immigration to the moral hazards of considering the american dream an entitlement, instead of a fantasy, would temper themselves. But this can only work if we bring our collective effort as a country towards a different system, and we stop drinking the globalization kool-aid as if we had to blindly abide by its tenants in all aspects of our economic lives.

Globalization is pretty much a fact of life. I don't think isolationism is the answer. We just need to make sure we have fair trade, and policies that don't incentivize outsourcing and offshore production when it's more efficient to produce here. Furthermore tax credits for R&D, education, and anything that would increase efficiency/production and encourage innovation.

Do I expect my countrymen to have such fortitude so as to accept the re-setting? Not really; while I may be able to convince some on here of the value of letting the paper house burn, I may not be so lucky in convincing other americans to let go off the economic system that allows them to live on borrowed time and money, provides them with an ever inflationary currency, overpriced goods and services, just so they can smile in public yet fret at night, cowardly wishing every night to the house fairy that their paper dreams don't collapse before their Maker comes, and certainly not before our global bookies come to collect.

If we are able to create wealth in America (production/innovation/R&D/exports/efficiency)... why can't people "really" afford the American dream with Real dollars instead of borrowing?

The bailout not passing was a good thing, I don't expect that outcome to repeat itself though, but I rather live in a country going through the strife of higher unemployment (constriction pains) looking towards a future where everybody including the household cat doesn't HAVE to go to work to afford a loaf of bread as we're currently heading towards; a country where people actually hold jobs that produce real wealth, strengthen our country's infrastructure (we've been there before) and directly impact our country's financial assest stability in the world market (again kinda like the 50s without the social backwardness). A country with less ipods and consumer trinkets on Xmas, but a national savings rate (of a solid dollar now mind you) that's a little above ZERO!

Why? The whole point of economic progress is to be able to consume more with less. Maximizing efficiency, productivity, and innovation.... If we were able to produce self-sustaining energy... we'd drastically reduce our trade deficit.

People are too focused on the today (it's not like americans haven't been accused before of having a short term memory), which is exactly how you get americans' attention. Fortunately today is FINALLY here and there's no hiding now. The ponzi scheme has finally been voiced out in public, with enough people listening. How long it takes us as a country to go from the economy we have today to a REAL and solvent economy will directly depend on how fast we want to let go off the dream and build upon our REAL future. I suspect many in our country will, as always, take the blue pill and pray for more bubbles and propping, particularly among those nearing retirement. But I really do hope we are more hardened like our predecessors, and choose the red pill. We'll see. Merry early effing Xmas 2008 I know that much.

I don't think it's really necessary for a total economic collapse to reform or rebuild. We have the tools... we've built up efficiencies and productivity.... we just need the policies, regulations, discipline, and guidance directed in the right direction.

Like I've said before... imagine if the capital/credit we've had in the last 8 years was directed at increasing production capacity, efficiency, infrastructure, energy independency, etc. Today we would probably getting more out of that initial investment/costs. We'd probably have a surplus, reduced/eliminated a trade deficit, etc.

America needs direction, discipline, and perseverance.... we have the people and ability... we just need proper leadership, policies, regulations, and apply them properly.

-chuck22b

[HappyTexan]

Originally Posted by Wild Style

They will and we will.

They already did, not will.

In the past 4 weeks the Fed Balance sheet increased 34%.

Financial Sense Online Market WrapUp with Chris Puplava 10.01.2008

[bxlefty23]

Originally Posted by DAP443

None, of course. Unemployment will cause more damage to the economy, in the long run. So, I choose inflation, I guess.

you have it backwards