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Old 08-12-2010, 02:29 PM
 
53 posts, read 47,286 times
Reputation: 51

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Quote:
Originally Posted by Philip T View Post
If someone pees in the ocean -- does the level go up?

Maybe in theory, but not in practice.

As the water evaporates, everyone peeing in ocean would not make the water go up.

Over the last two to three years, so much credit-currency that had been in circulation has evaporated that the new additional money being placed (so far on the circulation level) into the system not making up for it for the losses.

By normal fractional reserve lending -- once a dollar is placed into the bank, it should make 10 dollars available for borrowing. That should put 10 dollars in circulation -- or if one were Bear Sterns, around 33 dollars, as they were more highly leveraged and only had around 3% reserves.

But Bear Sterns (and folks who operated like them) are gone Buh Bye. The remaining banks are happy lending back to the .gov by buying bonds, and there is no longer any credit-currency for the masses of asses.

WTF
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Old 08-12-2010, 06:40 PM
 
5,410 posts, read 10,358,253 times
Reputation: 4493
Quote:
Originally Posted by Anthony Pepperoni View Post
WTF


OK.

Your premise was:

=====================

Everytime someone cashes an unemployment check the value of the money you've earned goes down. Just my POV. Tell me where I'm wrong?

====================

I am saying that is not the case.

The amount that goes to Joe Unemployed is so small and so trival compared to what has been destroyed by the banks, that Joe (and a few other million like him), are only helping slow the present deflation after the banker credit run-up collapsed. By my attempted metaphor, Joe is merely peeing in the ocean. A very small amount in an overall very large economy.

By contrast, look at what has happened over the last decade. Back when the idiot bankers were doing no-money-down, no-interest loans for houses at double the property's real value . . . THAT was inflationary. It doubled the price of housing in under a decade.

The bankers did this by insane reserve ratio lending of at least 10:1, up to 33:1 on the secondary level, such as Bear Sterns. For every dollar they would take on deposit, they were releasing into circulation 10 to 30 times as much into the economy in the form of (bad) credit.

When all that bad credit collapsed, all prices started to fall. (deflation) That was only arrested by the Feds pumping Billions into the economy -- along with a few Billion for Joe Unemployed. Pumping all that new money into the economy is all that is keeping US from sinking deeper.

Meanwhile Joe's Check is all that may be keeping him eating (and the grocery store in business) and sleeping in his house -- and keeping housing from falling further -- or at least slowing the fall. But if Joe is still eating and sleeping indoors, how do you figure that will harm you?
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Old 08-12-2010, 08:15 PM
 
53 posts, read 47,286 times
Reputation: 51
Quote:
Originally Posted by Philip T View Post


OK.

Your premise was:

=====================

Everytime someone cashes an unemployment check the value of the money you've earned goes down. Just my POV. Tell me where I'm wrong?

====================

I am saying that is not the case.

The amount that goes to Joe Unemployed is so small and so trival compared to what has been destroyed by the banks, that Joe (and a few other million like him), are only helping slow the present deflation after the banker credit run-up collapsed. By my attempted metaphor, Joe is merely peeing in the ocean. A very small amount in an overall very large economy.

By contrast, look at what has happened over the last decade. Back when the idiot bankers were doing no-money-down, no-interest loans for houses at double the property's real value . . . THAT was inflationary. It doubled the price of housing in under a decade.

The bankers did this by insane reserve ratio lending of at least 10:1, up to 33:1 on the secondary level, such as Bear Sterns. For every dollar they would take on deposit, they were releasing into circulation 10 to 30 times as much into the economy in the form of (bad) credit.

When all that bad credit collapsed, all prices started to fall. (deflation) That was only arrested by the Feds pumping Billions into the economy -- along with a few Billion for Joe Unemployed. Pumping all that new money into the economy is all that is keeping US from sinking deeper.

Meanwhile Joe's Check is all that may be keeping him eating (and the grocery store in business) and sleeping in his house -- and keeping housing from falling further -- or at least slowing the fall. But if Joe is still eating and sleeping indoors, how do you figure that will harm you?
-------------------------

Waaa? Destroyed by the banks? So dollars are evaporating into thin air like water? If you keep printing money each dollar is worth less. It doesn't get any simpler than that. Prices of homes are going down due to oversupply and high taxes, but only in certain markets. There are still markets that are flat or even increasing.. The price of oil, wheat, silver, gold and every other commodity that is not currently price controlled by uncle sam is going UP.

The gov. doesn't include oil and many IMPORTANT commodities in it's inflation calculation. Money doens't evaporte. Banks don't destroy money unless it's old and without having been given replacement dollars. Have you looked at the price of a box of cereal lately..? All of the mfgr's are now making smaller sizes of their products and charging the same or slightly higher price. If they gov. says' we're experiencing deflation, you can bet the opposite.

I WANT to be wrong. But I don't see things going anywhere but up in price. I want my dollars to be worth MORE not less. I don't see that happening.

//www.city-data.com/forum/fruga...over-last.html
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Old 08-12-2010, 11:45 PM
 
5,410 posts, read 10,358,253 times
Reputation: 4493
Quote:
Originally Posted by Anthony Pepperoni View Post
-------------------------

Waaa? Destroyed by the banks? So dollars are evaporating into thin air like water? If you keep printing money each dollar is worth less. It doesn't get any simpler than that. Prices of homes are going down due to oversupply and high taxes, but only in certain markets. There are still markets that are flat or even increasing.. The price of oil, wheat, silver, gold and every other commodity that is not currently price controlled by uncle sam is going UP.
Yes, Billions -- actually Trillions of "credit dollars" have been wiped out -- or evaporated as we are saying -- over the last two to three years. I have commercial lines of credit (that were not heavily used, but part of my reserve money for projects) that the banks have cut in half and lined out. Just cut the limits.

Same on houses. Even the foreclosed ones. Banks are sitting on them, because when they have to put them on the market and acknowledge the loss, suddenly the bank has less paper capitalization on the books.

Evaporated.

Quote:
The gov. doesn't include oil and many IMPORTANT commodities in it's inflation calculation. Money doens't evaporte. Banks don't destroy money unless it's old and without having been given replacement dollars. Have you looked at the price of a box of cereal lately..? All of the mfgr's are now making smaller sizes of their products and charging the same or slightly higher price. If they gov. says' we're experiencing deflation, you can bet the opposite.
First, you follow not all of "currency" is pieces of paper? Even an ATM card is a currency form, it is just not printed or stamped. As for the rest -- I sort of agree, or at least see what you are saying, as words to that effect have came from my mouth, as well. Especially the part about .gov mis-information.

But look at housing, look at wages. And as far as commodity prices -- we are still not up to where we were to prior the collapse. Was just checking Copper today (a pretty good bellwether). It is up from the Fall/Winter 2008 bottom, but overall not back where it was.

Quote:

I WANT to be wrong. But I don't see things going anywhere but up in price. I want my dollars to be worth MORE not less. I don't see that happening.

//www.city-data.com/forum/fruga...over-last.html
And I am not trying to debate, or even be right, myself. Just my observations, as well. As far as dollars being worth more (deflation) or less (inflation) -- I suppose somewhere near zero is ok by me. Making money on nothing but money -- or even trying to -- is how this mess got started in the first place.
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Old 08-13-2010, 04:09 AM
 
10,854 posts, read 8,512,026 times
Reputation: 3121
Quote:
Originally Posted by king's highway View Post
~

China, with its huge population, could have inherited the planet.

I say, "could have"... because this is no longer the case.

Decades of China's one child policy has put it on the fast track
to first world childless/aging demographic death.


~
One thing about having an authoritarian government is its policy can change rather quickly. If the Chinese government determines that the one child policy no longer serves the national interest it will abandon it.
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Old 08-13-2010, 06:00 AM
 
28,770 posts, read 31,447,458 times
Reputation: 29919
Quote:
Originally Posted by jertheber View Post
Socialism, Communism, and Capitalism all have the best interest of the masses as the foundation of their theoretical construct, but in reality we know that none of these systems has ever worked as well as they appear in theory.
Very well said. The crux of it is that there's almost always an elite few who come in to hijack the economy for their own personal interests, regardless of the system. It requires a savvy and vigilant citizenry to keep the elites in check or prevent them from getting too much power in the first place. Unfortunately, as is true in most of the rest of the world, Americans are neither savvy nor vigilant.
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Old 08-13-2010, 06:02 AM
 
28,770 posts, read 31,447,458 times
Reputation: 29919
Quote:
Originally Posted by hilgi View Post
The problem is that births don't really help us for decades, kids actually cost us more until they are productive. Immigration would help but the public will be against "dem taken r jubs".
I'm all for having educated immigrants come. But illegal, uneducated immigrants from the 3rd World end up being a drain on the tax base.
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Old 08-13-2010, 06:05 AM
 
28,770 posts, read 31,447,458 times
Reputation: 29919
Quote:
Originally Posted by hilgi View Post
We don't have true capitalism; we have more cronyism or corporatism. Capitalism just means that the allocation of capital is done by private hands as opposed to government or a king.

In our system the government grants protections to corporations and their owners at no real cost to the corporation. If we wanted a truly fair capitalist system we would no longer have the government play favorites with corporations through regulations and corporate welfare. We could then require them to pay for their limited liability status and be fully responsible for their actions. We could also reform corporate charters back to their original intent and make sure the risk they take can be fully paid for. (no more too big to fail)
I think I should copy and paste this post every time someone advocates more socialism as the antidote to capitalism on these boards. We haven't had true capitalism in the US for a very long time, if we ever did.
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Old 08-13-2010, 11:34 AM
 
Location: South Jordan, Utah
6,992 posts, read 7,812,870 times
Reputation: 3168
Quote:
Originally Posted by mysticaltyger View Post
I'm all for having educated immigrants come. But illegal, uneducated immigrants from the 3rd World end up being a drain on the tax base.
The are still cheaper in the short run then my expensive darn kids! :-)

Quote:
Originally Posted by mysticaltyger View Post
I think I should copy and paste this post every time someone advocates more socialism as the antidote to capitalism on these boards. We haven't had true capitalism in the US for a very long time, if we ever did.
Thanks, the socialist have done a good job convincing people we have capitalism.
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Old 08-14-2010, 03:17 AM
 
2,024 posts, read 4,839,585 times
Reputation: 1996
Inflation.US= pump and dump scam.
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