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They don't understand the printing of money and when times allow money to be printed and not printed. For the economy to remain strong the printing of money has coincide with the output of manufacturing and agriculture output. It is fined to print money when the manufacturing and agriculture output goes up but when they go down then the money supply that is printed has to go down also. Otherwise if they keep the printing presses of money going when the manufacturing and ag down there is going to be inflation with the result that prices of goods are going to go up. So what are we doing here in the U.S. Sending our manufacturing over seas and printing money like its going out of style. No wonder there is economic trouble here and going to get worst.,
He is likely referring to simple expansions of the money supply, something that central banks everywhere do on a small scale from time to time , but always on larger scales in response to significant liquidity being wiped out during major financial crises such as the Russian and Asian crises of the 1990's and the Great Recession of 2007-09.
He is likely referring to simple expansions of the money supply, something that central banks everywhere do on a small scale from time to time , but always on larger scales in response to significant liquidity being wiped out during major financial crises such as the Russian and Asian crises of the 1990's and the Great Recession of 2007-09.
In addition to mind reading perhaps you would be willing to explain how the money supply is controlled and expanded.
Look up what was going on when the world was on a gold standard.
I don't know about you, but I'd prefer NOT to go back to that.
The US problem is deficit spending, not the gold standard. It's never going to be fixed as long as 50% of the voting age population essentially pays zero Federal income taxes and the top-0.1% co-opt the other political party to ensure that their tax rate doesn't go up. If we had a broad-based tax hike where everyone has a stake in the system, you'd see the middle class insist on fiscal conservatives in Congress since it's their money that is being spent. It's easy to pull the Bernie "Free Stuff" lever when someone else is paying for it.
Look up what was going on when the world was on a gold standard.
I don't know about you, but I'd prefer NOT to go back to that.
Why not? Gold standard kept government spending in check and inflation was minimal. There were periods of times when prices of stuff fell due to gold standard and saving 'money' made sense.
What else would "printing money" refer to but expansion of the money supply?
Quote:
Originally Posted by jrkliny
...perhaps you would be willing to explain how the money supply is controlled and expanded.
Well, there are reserve requirements and discount and federal funds rates to tinker wirh, but also open market operations in which the Fed exchanges cash and note assets with the public. If the Fed is buying notes, it is expanding the money supply. If it is selling notes, it is contracting the money supply.
The US problem is deficit spending, not the gold standard.
The gold standard was a calamity that died in the 19th century. Its shortcomings are so severe that no nation in the world has chosen to remain on a gold standard.
Since 1970 meanwhile, the US has run a deficit in every year but four -- the four surplus years of Bill Clinton. Bush-43 made sure to upset that apple cart in short order.
Quote:
Originally Posted by GeoffD
It's never going to be fixed as long as 50% of the voting age population essentially pays zero Federal income taxes...
About 45% of households pay no federal income tax, and the reason they don't pay any is that they don't owe any. The same preferences, exemptions, and deductions that you take advantage of every year reduce their obligations to zero. They all of course pay other taxes. Payroll taxes, excise taxes, and state and local taxes take a serious bite for instance. The bottom 20% by income lose about 16% of that income to taxation. Everybody has skin in the game. Nobody is getting a free ride.
They don't understand the printing of money and when times allow money to be printed and not printed. For the economy to remain strong the printing of money has coincide with the output of manufacturing and agriculture output. It is fined to print money when the manufacturing and agriculture output goes up but when they go down then the money supply that is printed has to go down also. Otherwise if they keep the printing presses of money going when the manufacturing and ag down there is going to be inflation with the result that prices of goods are going to go up. So what are we doing here in the U.S. Sending our manufacturing over seas and printing money like its going out of style. No wonder there is economic trouble here and going to get worst.,
You are a supply sider. Today our consumer economy leans more towards the demand side. As inflation is not our problem today we want more money, more business and more jobs, so we have more demands, more spending and more inflation.
So when demands are low, like the 2008 crash, more money is created to improve on demands, which then tends to increase jobs and business to meet those demands.
Demand first then production.
Supply side is old hat.
When our economy is cooking on the high burner and employment is high/near full, that can more easily push us towards inflation. So there is less reason to create more money when business is booming.
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