Thread: The federal Reserve is the key.

You may be ignoring the function of money, as money, as we discussed earlier. Only as a legal tender medium of exchange, can both commodity money and fiat money carry the same risk.

How can it be otherwise, since fiat money is not commodity money?

You are ignoring the very basic simple fact that money by decree is worthless without that decree. Commodity money does not need a decree. It is worth something regardless of whether or not it is legal tender. Therefore, fiat money and commodity money are not the same and cannot ever be the same. At the very most basic level, fiat money, over time, will lose all its value while commodity money will always have intrinsic value. If you were to be giving a present to your grand children and you had a choice between leaving them a thousand dollars in cash or an ounce of gold, which would you choose, truthfully.

Originally Posted by Pogo

You might as well be saying that bubbles are benign, which I'm pretty sure history has proven otherwise.

How did you reach your conclusion that an economic stimulus is only a bubble if practiced via Statism? The "consumer base" should be sufficient stimulus to ensure greater consistency in revenue generation.

Originally Posted by Retro Fit

In my viewpoint, the vast majority of our elected officials are good, honest people who have the best interest of everyone in mind when they start out in politics. Then, after they are elected, they are indoctrinated into the ugly side of politics. A place where, if they are to last, they must "play ball". To play ball is to lose the connection with your ideals and connect to "reality". Reality being that lobbyists from every industry will be doing everything and everything to steer you to their way of thinking. In the past corporations have been known to do everything from run false news stories, to slandering officials to assassination to get their way.
It has been said that some of our covert bureau's bring heroin into the country to help pay for their operations. This is not ethical or Moral yet it is done.
We have occupied Iraq, hung their leader, stolen their natural resources, kill a half a million innocent civilians and to this day still occupy their country. We did this unprovoked. There is nothing ethical or Moral about that, yet it happened and is still happening. Are you denying that we are unethical and immoral enough to do these things?

Some people call us the Great Shysters. I think have a good point, sometimes.

Or we could slowly sell it for industrial purposes, so it would actually do something productive. Rather then going from one hoard to another.

That gold and silver is the property of the people of the United States. Monetizing it would be very productive for the economy.

Italicized is true, the rest is fabrication.

So you think that the Constitution withheld the use of fiat currency for the federal government excluding the states? That is utterly absurd.

So your telling me, that when, in 1792 the US Mint was placed under the Department of State, the members of congress at the time were confused about the meaning of having the power to coin money? What do you expect to happen, the US mint to force Representatives and Senators to literally coin money?

The treasury is the federal printing house. Congress should be able to tell them what to print without having a middle man. Having a middle man costs the public more money. That's what I am saying.

Further it isn't a private entity. The federal reserve helps manage the US's debt in through the use of US currency, it does not print the currency.

The fed is not a government entity. If , as you say, the fed is there to help manage the U.S. debt, they are doing a job poor enough to warrant their dismissal.

However, if you adjust for the growth in median income that change only constitutes a roughly 50% increase in price. Further you are looking at food, a field which has seen increasing selection towards higher quality goods since the 1960s. Take a look at consumer electronics and you'll notice that while prices may appear to be increasing the quality of those products is increasing more quickly. In fact if you wanted the same quality of goods and services today, that you wanted in the 1960s the perspective changes significantly. A four function calculator no longer costs hundreds of dollars. Vehicles are safer, lighter, and more efficient, electricity is produced cleaner and more efficiently, water is now processed both before human consumption and afterwards.

The rise is across the board. The cost of everything has gone up far more then 50% since the 1970's. Inflation has driven wages up here in the U.S. so that we cannot compete with any other market. Even in areas where the price should of gone down such as in agriculture, prices have still risen. And water...Back in the 70's we didn't need to buy drinking water.

It may seem like inflation has gone up, but in fact the paradox is, what we have been receiving for our money has increased far faster.

Inflation has gone up. It is not an illusion. The increase in Chinese goods has padded the impact of inflation by flooding our markets with Chinese goods we could never produce for as little ass they do.

Some people call us the Great Shysters. I think have a good point, sometimes.

What does " I think have a good point, sometimes." mean?

Originally Posted by Retro Fit

In my viewpoint, the vast majority of our elected officials are good, honest people who have the best interest of everyone in mind when they start out in politics. Then, after they are elected, they are indoctrinated into the ugly side of politics. A place where, if they are to last, they must "play ball". To play ball is to lose the connection with your ideals and connect to "reality". Reality being that lobbyists from every industry will be doing everything and everything to steer you to their way of thinking. In the past corporations have been known to do everything from run false news stories, to slandering officials to assassination to get their way.
It has been said that some of our covert bureau's bring heroin into the country to help pay for their operations. This is not ethical or Moral yet it is done.
We have occupied Iraq, hung their leader, stolen their natural resources, kill a half a million innocent civilians and to this day still occupy their country. We did this unprovoked. There is nothing ethical or Moral about that, yet it happened and is still happening. Are you denying that we are unethical and immoral enough to do these things?

Great post!

Playing ball is a great way to put it. It;s all about who has the least to lose.

Originally Posted by Retro Fit

What does " I think have a good point, sometimes." mean?

I may have been busier mustering with the bong militia. It was supposed to read

I think they have a good point, sometimes.

Sorry about that. I shouldn't neglect drilling with the typing militia.

Originally Posted by Norrin Radd

Great post!

Playing ball is a great way to put it. It;s all about who has the least to lose.

We have a supreme code law of the land and some people claim to have subjective moral value systems.

What would be wrong with a religious test for individuals who keep and bear subjective moral value systems? Shouldn't Morals be well regulated as virtues, instead of letting them be more anarchic and mobish as vices.

How is someone who has only a more objective and secular moral value system supposed to be able to distinguish between true Canaanites, Gamorrans, Sodomites, and false Christians; without a religious and subjective moral values test?

Originally Posted by danielpalos

How did you reach your conclusion that an economic stimulus is only a bubble if practiced via Statism? The "consumer base" should be sufficient stimulus to ensure greater consistency in revenue generation.

Would it be possible for you to reply in a less ambiguous manner?

Anyway, I never made such a conclusion and I have no idea why you think I did. What I'm saying is that trying to prop up spending in the wake of a collapsed bubble that was fed by irrational exuberance is insanity as far as the long term is concerned. It can only lead to another bubble, assuming the gov't/Fed throw enough money on the fire, and the cycle repeats, ad nauseum. This time, however, further dollar depreciation will only serve to hasten the end of dollar hegemony, and when that happens the shit will *really* hit the fan.

I think it depends on implementation; it could be considered a form of permanent stimulus that can lead to gains in productivity through a statist version of full employment of resources in the market for labor.

Originally Posted by danielpalos

I think it depends on implementation; it could be considered a form of permanent stimulus that can lead to gains in productivity through a statist version of full employment of resources in the market for labor.

And this gets paid for by printing more fiat money, which leads to further dollar depreciation and declining purchasing power for those down the chain, and on and on and on....

You may be missing the point about full employment of resources, it has a tendency to improve the standard of living and general welfare of participating market participants through mutually beneficial and market friendly trade.

It could simulate zero percent official unemployment or full employment of resources in the market for labor.

Originally Posted by Retro Fit

That gold and silver is the property of the people of the United States. Monetizing it would be very productive for the economy.

Monetizing it would only move it out of one hoard and into another. Hoarding is an economic inefficiency. Further it would prove no advantage to the United States economy.

So you think that the Constitution withheld the use of fiat currency for the federal government excluding the states?

The US constitution did not withhold the US of fiat currency. Nor did it require currency to be based on gold or silver, or any other precious metal.

The treasury is the federal printing house. Congress should be able to tell them what to print without having a middle man. Having a middle man costs the public more money. That's what I am saying.

Except it earns the US money, manages the debt, maintains the economic stability of the country, and is beyond the purview of most members of congress. Congress isn't interested in the day to day monetary policy and cannot respond as necessary. That is why the enforcement of the laws is left to the executive branch. Further so long as the current laws are executed faithfully, and they serve their purpose well there is little reason for congress to continually revisit the matter of basic currency policy.

The fed is not a government entity. If , as you say, the fed is there to help manage the U.S. debt, they are doing a job poor enough to warrant their dismissal.

They manage a large portion of the debt in circulation in order to promote economic stability through repurchase agreements, buy-backs and sales. They do this fairly well, as can be noted by the fact they turn a net profit every year.

The rise is across the board. The cost of everything has gone up far more then 50% since the 1970's.

Not if you look at the improvements in income and quality.

Inflation has driven wages up here in the U.S. so that we cannot compete with any other market.

Now here your demonstrating a fundamental lack of understanding of inflation as well.

Lets say that inflation drives up wages by 50% and prices by 50% over a given time period, assuming an even distribution there is no net change. It does not make the US more or less competitive. In fact the economic situation of the country, ceteris paribus, is unchanged. However, the United States hasn't had everything else equal, in fact the United States has experienced significant real economic growth.

Even in areas where the price should of gone down such as in agriculture, prices have still risen. And water...Back in the 70's we didn't need to buy drinking water.

Still don't need to buy drinking water if you have a well. If you don't have a well you purchase it from the city, or municipal water company as you did much further back then the 1970s. Whats more water quality and air quality have improved significantly since the 1970s.

Inflation has gone up. It is not an illusion. The increase in Chinese goods has padded the impact of inflation by flooding our markets with Chinese goods we could never produce for as little ass they do.

Actually the United States specialized towards producing with a higher skilled work force, which has increased its productive capacity and its efficiency. While at the same time we've moved towards an economy which is more heavily reliant upon information and technology then solely manufacturing.