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Except that the "manipulators" are reactionary. They simply try to undue the harm Americans and their politicians do to themselves. Americans could have chosen the real path the espoused for 100 years and actually went through S. America "nation building" but instead they used the Monroe Doctrine to economically enslave states for their own benefit without regard for their slave's well being. Had America had forethought they would have realized that if they had a rurally built nations and their infrastructure those nations would have needs for things like washers, dryers, ranges, refrigerators, plumbing along with all the other creature comforts Americans have. But since they decided it was better to steal the wealth of nations (snickers) and leave them, after 100 years of king-like rule, impoverished and in most cases without even a basic sanitation system and running water those states had no option but to watch Americans get richer on their backs and hope some day there really would be a Shining City on the Hill that they could emulate. As we know now, that SCOAH is BRIC and they're reaping all the benefits Americans were too short sighted to plan for.
I cant decide if my lack of understanding is because I am dense, or because my nerve pain is frying my brain, or is what you are saying is gibberish.
The goldbugs act as if the world was perfect when everyone was on the gold standard. Even the most cursory glance as history says otherwise. There was no central bank in the US from 1830 something til 1913. During that time there were booms and busts, same as there have been since the establishment of the Fed in 1913.
The smart guys who manipulate money are not just in government. The big banks have some pretty smart boys working to do the same. Someone will have to spend a lot of time explaining to me how returning to the so called gold "standard" would change any of that.
The smart guys who manipulate money are not just in government. The big banks have some pretty smart boys working to do the same. Someone will have to spend a lot of time explaining to me how returning to the so called gold "standard" would change any of that.
Where in the world are you getting that deflation of prices of products is a bad thing???
I mean hell, I am hurting real bad buying cheaper computers every year. What a tragedy. Or what about deflating products of hard drives, plastic surgery, etc. Deflation of prices are a GOOD thing.
Deflation of prices happens when you have sound economic policy. we had the LOWEST UNEMPLOYMENT RATE IN THE HISTORY OF EVERY SINGLE COUNTRY THAT HISTORY HAS BEEN RECORDED WITH THIS SYSTEM.
Ok, now prove me wrong.
Keep in mind that money supply deflaton is different than price deflation.
Meanwhile on the unmentioned producer-side, margins nosedive and millions of businesses fail. The few surviving employed earn a fraction of their former wages. Tax revenue dries up, so more gov't layoffs. The trade deficit worsens from inability to export, so cash leaves the country rapidly while the real value of debt rises and we die a slow, agonizing death.
LOL! The entire "Austrian School" is a pile of heterodox manufactured nonsense. It exists only as part of a disinformation complex that serves only to provide a mouthpiece and propaganda outlet for the ultra-rightwing corporatists who paid to construct it.
Meanwhile, this is not a cash-and-carry world. Credit is the lifeblood of every modern economy and underlies all economic activity. Deflation amplifies the costs of credit, thereby draining away demand which diminishes production, jobs, and incomes. It also causes people to delay as much spending as they can, further eroding demand, etc. With deflation, producers spend more on production than they can recoup from selling the inventory they have produced. Profits, incomes, and economic activity accordingly dwindle further. Businesses try to reduce labor costs by firing people. That's even more reduction in demand. Governments can't borrow, so they have to raise taxes in order to maintain essential public services. Guess what that causes. Deflation is where downard economic spirals come from. Austrians are apparently blinded to the plainly obvious here.
There was no central bank in the US from 1830 something til 1913. During that time there were booms and busts, same as there have been since the establishment of the Fed in 1913.
Central banking didn't actually get its feet on the ground in this country until after WWII. The overall effects of central banking have been that we experience fewer recessions, and that they are milder and of shorter duration. Of course, if you manage to put idiots in office, all bets are off.
all I see are monumentally stupid people in this thread who have no idea what they are talking about.
during the 1800's we had a gold standard. it limits and constrains the money supply. Prices during this period all went down substationally. That is how free markets work. they actually puch prices down in relation to a slow growth of money.
Governments and banks love inflation because they steal wealth from the system with an unbacked currency. They steal because they print money which steals value from the existing money in the system. it empoverishes the people who hold dollars and they steal the buying power from the currency.
The poor and middle class thrived under the gold standard, fiat money enriches bankers and government and coporations.
Anyway, like the romans did, you can dilute gold/ fake it/etc on a gold standard. the country could hold fake gold and claim it as real. or just dilute the coinage like they do today and everywhere.
Ultimately your money system is only as legit as the honesty of the men running the country or who control the currency.
Inflation is a tax in that it alters the proportion of wealth/cash held by the private sector and the public sector by diluting the portion held by the private sector.
In the past there have been several criticisms of this approach because (a) it is a stealth tax and (b) Congress didn't have to vote for it. I don't agree with the "stealth tax" view, because people have rational expectations and factor expected deflation into account in their economic planning.
The argument that Congress didn't have to vote for it is a stronger one - but it is moot at this point in time.
Your general point that fiat money can enable an unscrupulous government to monetize its debt is valid. And suffering caused by hyperinflation is real -- see for example Hyperinflation - Wikipedia, the free encyclopedia .
In the US system, the Federal Reserve is thankfully insulated from direct control by politicians. This is a major reason the US Dollar has been the reserve currency of the world.
Last edited by SportyandMisty; 07-25-2013 at 11:45 AM..
Central banking didn't actually get its feet on the ground in this country until after WWII. The overall effects of central banking have been that we experience fewer recessions, and that they are milder and of shorter duration. Of course, if you manage to put idiots in office, all bets are off.
If only the Fed knew then what we know now, the Great Depression wouldn't have been catastrophic.
Actually, its sorta exactly what he said.
Quote:
In this view, the Federal Reserve, by not acting, allowed the money supply as measured by the M2 to shrink by one-third from 1929–1933
Kinda hard to make a foot print not doing anything.
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