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All money is loans, and the one with access to the lowest rates sucks up all the wealth. In a depression, the first one to get the cheapest money wins.
If I have 100 seats and 10 of them are empty, then new liquidity is going to fill those empty seat and drive up the profits of the other 90. Thus if I am losing money at $4 a seat with a profit starting at $5, Then the prices on all of them will be driven up quickly by a bidding war for the 100th seat, say up to $10.
The first one to get the cheapest money wins, and that was the banks, again. Now they can up real estate access charges with their seat monopoly.
They were also given treasuries for junk which is like exchanging a dead beat alcoholics IOU for a VP at DuPont.
BTW an IOU from a VP in DuPont among dope addicts is as good as MONEY. They'd pass it around and trade it for needles. If you just understood that then you will finally know what money is. Its a debt. All money, no matter what form it takes is debt. In this system, its created as a debt because before the VP at DuPont became indebted, it didn't even exist. Fail to understand this, and you may as well just babble terms out of an economic dictionary.
i will tell you what people understand instinctively.
they understand that jobs have left this country forever and when the government decided to go on a printing spree, instead of pumping this newly printed money into small business creation and employment, they spent it on "bailing out" the big banks and backstopping foreign countries. (oh, and stuff that falls in the "other" category)
the trust part of fiat currency is being destroyed, obviously on purpose, because who would be that stupid otherwise?
debt certainly becomes a big problem when you can't even keep up with the interest payments, as any person who has declared bankruptcy would probably attest.
All money is loans, and the one with access to the lowest rates sucks up all the wealth. In a depression, the first one to get the cheapest money wins.
What the hell are you talking about.. I have a wallet with money in it, who is that borrowed from? And even better, how the hell does having this in my wallet create government debt. You are just jumping around babbling and not making any points
Quote:
Originally Posted by gwynedd1
If I have 100 seats and 10 of them are empty, then new liquidity is going to fill those empty seat and drive up the profits of the other 90. Thus if I am losing money at $4 a seat with a profit starting at $5, Then the prices on all of them will be driven up quickly by a bidding war for the 100th seat, say up to $10.
The first one to get the cheapest money wins, and that was the banks, again. Now they can up real estate access charges with their seat monopoly.
Wrong again Shirlock Holmes because first of all, if the 100th seat was able to be sold for $10, this means (according to your math), that they lost $6 for the other 99 seats. This is why seat pricing doesnt work their way up, they actually work their way down, until a saturation point is reached and THEN it starts to reclimb.
But again, what the hell does this have to do with the debt ?
Quote:
Originally Posted by gwynedd1
They were also given treasuries for junk which is like exchanging a dead beat alcoholics IOU for a VP at DuPont.
BTW an IOU from a VP in DuPont among dope addicts is as good as MONEY. They'd pass it around and trade it for needles. If you just understood that then you will finally know what money is. Its a debt. All money, no matter what form it takes is debt. In this system, its created as a debt because before the VP at DuPont became indebted, it didn't even exist. Fail to understand this, and you may as well just babble terms out of an economic dictionary.
All money is not debt. Why dont you get out of your moms basement and go get a job, THEN come back and tell me after you get a paycheck or two how that creates debt.
All that would mean is more money is in the form of bank credit. The national debt is publicly created money and nothing more. That is why Japan has such a big ratio. Much of their money is in the form of public debt instead of private credit. Their money is cheaper than ours because more of ours is rented from banks with interest charges.
It means that if the debt was 50% of GDP, it would be more affordable, and therefore not a problem. If we could grow the economy fast enough, the debt balance would not matter. Most of the debt is owed back to private citizens like you and me, and it would make no sense to pay it all back.
What the hell are you talking about.. I have a wallet with money in it, who is that borrowed from? And even better, how the hell does having this in my wallet create government debt. You are just jumping around babbling and not making any points
The money in your wallet was originally created as a bank loan.Someone borrowed and spent it. Now you have it. That is how it works. That is why it sound like babble to you. Only the loose change in your wallet originated from the Treasury.
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Wrong again Shirlock Holmes because first of all, if the 100th seat was able to be sold for $10, this means (according to your math), that they lost $6 for the other 99 seats. This is why seat pricing doesnt work their way up, they actually work their way down, until a saturation point is reached and THEN it starts to reclimb.
The housing market's value is based up available credit and money. Thus the value of mortgage based assets is based upon slack in the system. Taking slack out of the system means instant profits to banks by the simple laws of queuing. Ask anyone who knows about ethernet traffic curves on a saturated line.
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The first QE added contention back into the system and supported housing. This will unfortunately collapse again because the actual support will continue to erode.
Quote:
But again, what the hell does this have to do with the debt ?
All money is not debt. Why dont you get out of your moms basement and go get a job, THEN come back and tell me after you get a paycheck or two how that creates debt.
All money is debt. I have my own basement. In fact, I dumped all financial assets and REITs in 2005, moved into energy in 2004, PMs in 2005 and invested in asset rich equities. I knew we went into rent seeking . I am well insulated because I saw it coming.
This will explain a lot of it, including how money is produced with bank credit.
All that would mean is more money is in the form of bank credit. The national debt is publicly created money and nothing more. That is why Japan has such a big ratio. Much of their money is in the form of public debt instead of private credit. Their money is cheaper than ours because more of ours is rented from banks with interest charges.
Tell me you are just making things up as you go along.
There is only about $3T in US currency in circulation, so tell me where the other $12T came from to pay the $15T debt
Zimbabwe has something like $100B in circulation, and has something like $7B TOTAL national debt. According to your postings, a Zimbabwe dollar should be far more expensive than ours, but clearly its not.
i will tell you what people understand instinctively.
they understand that jobs have left this country forever and when the government decided to go on a printing spree, instead of pumping this newly printed money into small business creation and employment, they spent it on "bailing out" the big banks and backstopping foreign countries. (oh, and stuff that falls in the "other" category)
How do you pump money into small business creation and employment if you allow the banking system to crash, and take down the entire economy? About 250 billion of the stimulus was "pumped" into small business creation and emplyment in form of tax cuts, but if the banking system had failed, we would probably be in another great depression at this time.
It means that if the debt was 50% of GDP, it would be more affordable, and therefore not a problem. If we could grow the economy fast enough, the debt balance would not matter. Most of the debt is owed back to private citizens like you and me, and it would make no sense to pay it all back.
No, the debt is the money. Paying down debt with the same debt extinguishes the money supply. Its a debt based monetary system. Look it up.
The money in your wallet was originally created as a bank loan.Someone borrowed and spent it. Now you have it. That is how it works. That is why it sound like babble to you. Only the loose change in your wallet originated from the Treasury.
And if they borrowed it, they would be paying it back with interest, which according to you, means the government would be running surpluses.. Clearly they arent
Quote:
Originally Posted by gwynedd1
The housing market's value is based up available credit and money. Thus the value of mortgage based assets is based upon slack in the system. Taking slack out of the system means instant profits to banks by the simple laws of queuing. Ask anyone who knows about ethernet traffic curves on a saturated line.
So your evidence of seat pricing going up, and not down, is the housing market prices climbing due to an ethernet traffic curve? Really? Why dont you do some studying on seat pricing in REAL LIFE situations like airfare seats? Bcause of course it would prove you wrong. Furthermore, a housing value is up when money is flowing FASTER, there is more money in the system now than 3-4 years ago, according to you, this would mean housing is more expensive now than before. Clearly this isnt the case
Quote:
Originally Posted by gwynedd1
The first QE added contention back into the system and supported housing. This will unfortunately collapse again because the actual support will continue to erode.
But you said debt is meaningless, and now you are saying the housing industry will collapse because its not. Make up your mind.
Quote:
Originally Posted by gwynedd1
All money is debt. I have my own basement. In fact, I dumped all financial assets and REITs in 2005, moved into energy in 2004, PMs in 2005 and invested in asset rich equities. I knew we went into rent seeking . I am well insulated because I saw it coming.
But why bother dumping financial assets and REIT in 2005 if its meaningless? I'm well insulated as well, I went into NNN leased real estate and government rentals and my property values have actually gone up due to limited supply, even though credit and money has tightened, thus against proving your theories wrong.
Quote:
Originally Posted by gwynedd1
This will explain a lot of it, including how money is produced with bank credit.
I am tired of seeing it posted so I am going to savagely attack this idiotic, OP ed favorite of junk economics.
1. The national debt is the money supply. The debt is the sum total of dollars that was created by the government. It prints money by running deficits because we use a double entry system where one debt = one credit. The rest of the money is created by bank loans, also a double entry system with a few exceptions like coins which are debt free.
2. Its who owns the debt that matters which can be the FED, US institutions, citizens, and foreign. The unqualified nominal amount of debt is meaningless. Debt to self is largely meaningless unless of course its used as money. One of the fasted growing areas of our debt is to the FED which is at 1.7 trillion. It actually reduces real debt since it dilutes the rest of it. The debt isn't being increased to buy anything; its being used to create money. Its their incompetent or corrupt use of the liquidity that is the problem. Not a single tax payer was bailed out.
3. It does not all need to be paid back. It must not all be paid back, and to do so would destroy the money supply almost entirely.
4. The US trade deficit is the same issue. Even US treasury coins that are not created with the debt facade as "debt free" money still becomes "check book", zero interest debt when it leaves our shores(dollars are check book money and bonds are saving account money). The problem is when other countries like to use our money because it goes out but never comes back in. The real problem is that the US economy is now only a small part of the world economy. So we are now highly leveraged. Its the bonds and outstanding dollars that comprise the foreign debt which has all meaning; the nominal national debt has none.
The real problems are
* mortgage debt to GDP ratio
* high land prices
* foreign debt and shrinking share of world economy increasing dollar leverage
* dollar carry trade
* zero interest rate policy
If you continue to whine about the national debt, you are listening to some brain dead main stream economic pundit provided for you as cover while in the real world they are field striping the country.
I am wondering if you or your source would consider the over $3 trillion that is owed to Social Security by our Congress as debt, or what. I say that SS would be in trouble if they hadn't spent it like the money paid in by workers as plain old income tax. Is that amount part of the national debt?
No, the debt is the money. Paying down debt with the same debt extinguishes the money supply. Its a debt based monetary system. Look it up A Monetary Sytem for the New Millenium
I know what "money is created out of debt" means, but that is not what I am talking about. I am simply saying that the balance would be a lesser problem if we could grow the economy. It would not make sense to pay down all the debt. As a matter of fact it would create a disaster.
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