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visitorq
Joined: 11 Jan 2008
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 Posted: Sun May 20, 2012 8:40 am Post subject: |
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| atwood wrote: |
Hyperinflation...Ha. Ha. Ha. "The cartel"--you give yourself away. It's ALL the Fed's fault; any intelligent person can see this is a one-sided view taken to prove an ideological stance.
History? Your claim that every bust in the U.S. was caused by a central bank is nonsense. And they were much, much more common. |
It is all the Fed's fault (and since the Fed is a complicated system, this analysis covers all the bases). It is a cartel, by definition, and hyperinflation had happened in Germany just prior to the great depression, which accounts for the Fed shutting off the money after the crash (which the Fed had caused by creating massive amounts of new money to fuel an artificial boom). They did it so as not to lose complete control over their monopolistic system. It is not ideological conclusion - it is completely rational and based in historical fact, but only someone with any clue whatsoever about how the monetary system works could understand why. That includes most people in this thread, but certainly leaves you out.
Seriously, stop talking BS and step up to the plate. Name a single "bust", or better yet a depression (that was in any way on the scale of the great depression that the Fed caused) and was caused by the free market and not the government or central banking. You can't. Because you're wrong and know nothing about history or how the monetary system functions. Reading your drivel just is an embarrassment. |
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northway
Joined: 05 Jul 2010
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| Posted: Sun May 20, 2012 9:36 am Post subject: |
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| visitorq wrote: |
| Seriously, stop talking BS and step up to the plate. Name a single "bust", or better yet a depression (that was in any way on the scale of the great depression that the Fed caused) and was caused by the free market and not the government or central banking. You can't. Because you're wrong and know nothing about history or how the monetary system functions. Reading your drivel just is an embarrassment. |
http://en.wikipedia.org/wiki/Tulip_mania |
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ontheway
Joined: 24 Aug 2005
Location: Somewhere under the rainbow...
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| Posted: Sun May 20, 2012 10:28 am Post subject: |
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jaykimf
Joined: 24 Apr 2004
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| Posted: Sun May 20, 2012 11:02 am Post subject: |
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| slothrop wrote: |
i'm not an expert on economic theory, so please forgive if my questions seem ignorant.
can't everything just go on forever with paper money not pegged to anything tangible as long as the people all agree to keep recognizing it as legitimite?
even with hyperinflation, where a loaf of bread costs 10times as much as a few years ago, if salaries rise along with the price of bread, does it really matter, so long as nobody saves and is constantly taking on more debt to drive the economy?
i understand why fractional reserve banking is ponziesque, and paper money in general only has value so long as the masses are convinced it does... i see how pegging the $ to gold appears to give paper money a foundation and legitimacy.. but where does gold get it's value from ultimatly? i understand that gold is finite and actually exists, as opposed to #'s entered onto a ledger which are imaginary... but doesn't gold ultimately get it's value from the same place as paper money? the masses perception of value in a thing that ultimately has none? isn't claiming that a gold standard can fix the problem of the legitimacy of currency, really like the old story of the world resting on the back of a turtle? when the philosopher asked "then what does the turtle rest upon?", an old lady answered "you can't fool me! it's turtles ALL THE WAY DOWN!"
don't get me wrong.. as far as politicans go, ron paul is the only one i can listen to with out busting a gut laughing or else puking my brains out. i generally like his thinking on most issues. i just can't wrap my mind around how a gold standard fixes the problem. wouldn't it just end up with the same crooks that control everything now holding all the gold? |
Yes , of course paper (fiat) money can go on indefinitely as long as it is legal tender. As for gold, you are correct. It's value is largely a matter of faith.
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This intrinsic value argument, however, does not generally hold. The truth is, gold mostly holds its value based on faith as well. Gold of course does have commercial value. It has always been used for jewelry, for a time in dentistry, and more recently has had industrial uses, such as for electronics. Certain of its chemical attributes (e.g., the fact that it does not oxidize) has made it attractive for such purposes. Hence, it was a convenient commodity to use as money in transactions.
However, once its use as money became widespread, the demand for gold for monetary purposes far outstripped its demand for non-monetary uses. As a result, much more of it was mined and refined than would have been the case just to satisfy the demand for it in jewelry and electronics. If there were no demand for gold as store of wealth (i.e., potential monetary use), its value would fall precipitously. Consequently, in terms of intrinsic value, gold is remarkably like paper money: its current value much exceeds its value for non-monetary purposes; it maintains this value only because people have faith that it will continue to be useful for transferring wealth; were this faith to collapse, its value would as well. |
http://home.hiwaay.net/~becraft/FRS-myth.htm#hd23
Furthermore the instability of the price of gold makes it unsuitable as a monetary base.
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| This is an issue that has returned to a certain prominence in the last few years. But despite it's popularity among some on the right -- and Ron Paul fans in particular -- economists overwhelmingly agree that the gold standard is a bad idea. In this sample of leading economists, 100% of disagreed with the claim that returning to a gold standard would improve price-stability or employment outcomes. Nobody even answered uncertain, because this question really isn't up for debate anymore. |
http://www.theatlantic.com/business/archive/2012/04/4-politically-controversial-issues-where-all-economists-agree/255600/
Some of the comments made by leading economists:
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| A time series plot of the price of consumption in ounces of gold, and then in US dollars, clarifies that gold is not a stable standard. |
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| Modern interest-rate feedback rules (Taylor rules) do a vastly better job. The instability of the relative price of gold is way too high. |
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| The relative price of gold can be very volatile. |
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| A gold standard regime would be a disaster for any large advanced economy. Love of the G.S. implies macroeconomic illiteracy. |
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| There are much better ways to avoid excessive inflation, while maintaining the flexibility of a fiat currency. |
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| Gold is intrinsically close to useless, so its price is determined as a "bubble". |
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| Gold is used as a safe haven in financial crisis. That has little to do with US inflation. |
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| This is a market like any other. The supply of gold and other sources of demand affect its price in real terms relative to other goods. |
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| There is no discernible connection between gold price and CPI movements in the period since the demonetization of gold in 1971. |
http://www.igmchicago.org/igm-economic-experts-panel/poll-results?SurveyID=SV_cw1nNUYOXSAKwrq |
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northway
Joined: 05 Jul 2010
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| Posted: Sun May 20, 2012 11:27 am Post subject: |
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visitorq
Joined: 11 Jan 2008
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| Posted: Sun May 20, 2012 12:34 pm Post subject: |
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| northway wrote: |
| visitorq wrote: |
| Seriously, stop talking BS and step up to the plate. Name a single "bust", or better yet a depression (that was in any way on the scale of the great depression that the Fed caused) and was caused by the free market and not the government or central banking. You can't. Because you're wrong and know nothing about history or how the monetary system functions. Reading your drivel just is an embarrassment. |
http://en.wikipedia.org/wiki/Tulip_mania |
Thanks for proving my point. Tulip Mania was a result of massive increase in the money supply caused by the Bank of Amsterdam, the central bank of the Netherlands! It is considered to be the first central bank in history, so it's hardly a coincidence that its creation was followed by a massive speculative bubble.
Anyway, that one was too easy... For a more detailed breakdown, see this link: http://mises.org/daily/2564 |
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jaykimf
Joined: 24 Apr 2004
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| Posted: Sun May 20, 2012 12:35 pm Post subject: |
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The practice of keeping only a fraction of deposits on hand has a cumulative effect for the banking system as whole. Effectively, it permits the banking system to "create" money. If a given sum of cash is deposited in bank A, and half of it is lent out, whoever borrows it spends it, and the money becomes the deposit in bank B of someone else. Half of that sum is then lent out, spent, and deposited. The process continues until the total amount of deposits is a multiple of the initial amount of cash. In this example, the cumulative total is ultimately twice the initial amount. In practice, the multiple depends on what fraction is kept in hand as reserves by the bank and what fraction is kept as "pocket cash" outside the banking system.
Thus, "fractional reserve banking" effectively permits the creation of money by the banking system to a multiple of the "base" money (typically created by the government). But while the system as a whole creates money, individual banks generally do not. Even though each bank may have in checking accounts a sum that is equal to the money that was deposited with it, as a group, total deposits in all banks are a multiple of the initial amount. |
http://home.hiwaay.net/~becraft/FRS-myth.htm#hd8 |
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northway
Joined: 05 Jul 2010
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| Posted: Sun May 20, 2012 1:38 pm Post subject: |
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| visitorq wrote: |
| northway wrote: |
| visitorq wrote: |
| Seriously, stop talking BS and step up to the plate. Name a single "bust", or better yet a depression (that was in any way on the scale of the great depression that the Fed caused) and was caused by the free market and not the government or central banking. You can't. Because you're wrong and know nothing about history or how the monetary system functions. Reading your drivel just is an embarrassment. |
http://en.wikipedia.org/wiki/Tulip_mania |
Thanks for proving my point. Tulip Mania was a result of massive increase in the money supply caused by the Bank of Amsterdam, the central bank of the Netherlands! It is considered to be the first central bank in history, so it's hardly a coincidence that its creation was followed by a massive speculative bubble.
Anyway, that one was too easy... For a more detailed breakdown, see this link: http://mises.org/daily/2564 |
Here's the problem with talking to rabid libertarians: anything good was begotten by free enterprise, and anything bad was the fault of the government. If there was the most minute government involvement in anything bad that happened, ever, it was the fault of the government. If there was anything good that happened, ever, it was due to private enterprise, regardless of whatever government intervention there might have been. Like I said above, free market theory taken far enough - and several posters on this board certainly take it far enough - is just as radical as what you might hear from a frothing at the mouth communist circa 1925. Neither are realistic theories. Yes, the free market ideologue can always find a way to blame government for something; similarly, the aforementioned spittle spewing communist can always find a way to blame private enterprise. In both cases, the absurd, unscientific, untested theories espoused by said ideologues fail to offer much in the way of solutions outside of tearing it all down. |
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visitorq
Joined: 11 Jan 2008
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| Posted: Sun May 20, 2012 2:33 pm Post subject: |
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| northway wrote: |
| visitorq wrote: |
| northway wrote: |
| visitorq wrote: |
| Seriously, stop talking BS and step up to the plate. Name a single "bust", or better yet a depression (that was in any way on the scale of the great depression that the Fed caused) and was caused by the free market and not the government or central banking. You can't. Because you're wrong and know nothing about history or how the monetary system functions. Reading your drivel just is an embarrassment. |
http://en.wikipedia.org/wiki/Tulip_mania |
Thanks for proving my point. Tulip Mania was a result of massive increase in the money supply caused by the Bank of Amsterdam, the central bank of the Netherlands! It is considered to be the first central bank in history, so it's hardly a coincidence that its creation was followed by a massive speculative bubble.
Anyway, that one was too easy... For a more detailed breakdown, see this link: http://mises.org/daily/2564 |
Here's the problem with talking to rabid libertarians: anything good was begotten by free enterprise, and anything bad was the fault of the government. If there was the most minute government involvement in anything bad that happened, ever, it was the fault of the government. If there was anything good that happened, ever, it was due to private enterprise, regardless of whatever government intervention there might have been. Like I said above, free market theory taken far enough - and several posters on this board certainly take it far enough - is just as radical as what you might hear from a frothing at the mouth communist circa 1925. Neither are realistic theories. Yes, the free market ideologue can always find a way to blame government for something; similarly, the aforementioned spittle spewing communist can always find a way to blame private enterprise. In both cases, the absurd, unscientific, untested theories espoused by said ideologues fail to offer much in the way of solutions outside of tearing it all down. |
Rabid libertarians? Just because you can't hack the truth? Rather than spew out a bunch platitudes, why not offer a rebuttal? Was tulip mania, or was it not caused by a government bank expanding the money supply? I've already shown you how it was. Your turn to offer any relevant insight, if you have any.
Also, your comparison of libertarianism to communism is patently absurd. Libertarianism has something that communism lacks completely: logic. |
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atwood
Joined: 26 Dec 2009
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| Posted: Sun May 20, 2012 5:04 pm Post subject: |
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| visitorq wrote: |
| atwood wrote: |
Hyperinflation...Ha. Ha. Ha. "The cartel"--you give yourself away. It's ALL the Fed's fault; any intelligent person can see this is a one-sided view taken to prove an ideological stance.
History? Your claim that every bust in the U.S. was caused by a central bank is nonsense. And they were much, much more common. |
It is all the Fed's fault (and since the Fed is a complicated system, this analysis covers all the bases). It is a cartel, by definition, and hyperinflation had happened in Germany just prior to the great depression, which accounts for the Fed shutting off the money after the crash (which the Fed had caused by creating massive amounts of new money to fuel an artificial boom). They did it so as not to lose complete control over their monopolistic system. It is not ideological conclusion - it is completely rational and based in historical fact, but only someone with any clue whatsoever about how the monetary system works could understand why. That includes most people in this thread, but certainly leaves you out.
Seriously, stop talking BS and step up to the plate. Name a single "bust", or better yet a depression (that was in any way on the scale of the great depression that the Fed caused) and was caused by the free market and not the government or central banking. You can't. Because you're wrong and know nothing about history or how the monetary system functions. Reading your drivel just is an embarrassment. |
So hyperinflation in Germany was a contributing factor? Thanks for making my case.
Are you sure it's just the Fed controling the world economy? What about the Trilateral Commision, the Zionists, George Soros, et al?
As for your request, funny stuff. There is no true free market and never has been so what could it cause? Even for drivel, since you've got the market cornered on that commodity. |
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atwood
Joined: 26 Dec 2009
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| Posted: Sun May 20, 2012 5:07 pm Post subject: |
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| visitorq wrote: |
| northway wrote: |
| visitorq wrote: |
| Seriously, stop talking BS and step up to the plate. Name a single "bust", or better yet a depression (that was in any way on the scale of the great depression that the Fed caused) and was caused by the free market and not the government or central banking. You can't. Because you're wrong and know nothing about history or how the monetary system functions. Reading your drivel just is an embarrassment. |
http://en.wikipedia.org/wiki/Tulip_mania |
Thanks for proving my point. Tulip Mania was a result of massive increase in the money supply caused by the Bank of Amsterdam, the central bank of the Netherlands! It is considered to be the first central bank in history, so it's hardly a coincidence that its creation was followed by a massive speculative bubble.
Anyway, that one was too easy... For a more detailed breakdown, see this link: http://mises.org/daily/2564 |
So the banks forced people to buy tulips? |
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northway
Joined: 05 Jul 2010
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| Posted: Sun May 20, 2012 5:18 pm Post subject: |
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| atwood wrote: |
| visitorq wrote: |
| northway wrote: |
| visitorq wrote: |
| Seriously, stop talking BS and step up to the plate. Name a single "bust", or better yet a depression (that was in any way on the scale of the great depression that the Fed caused) and was caused by the free market and not the government or central banking. You can't. Because you're wrong and know nothing about history or how the monetary system functions. Reading your drivel just is an embarrassment. |
http://en.wikipedia.org/wiki/Tulip_mania |
Thanks for proving my point. Tulip Mania was a result of massive increase in the money supply caused by the Bank of Amsterdam, the central bank of the Netherlands! It is considered to be the first central bank in history, so it's hardly a coincidence that its creation was followed by a massive speculative bubble.
Anyway, that one was too easy... For a more detailed breakdown, see this link: http://mises.org/daily/2564 |
So the banks forced people to buy tulips? |
This. There's a big difference between being the sole cause and being one of a variety of causes. |
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visitorq
Joined: 11 Jan 2008
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| Posted: Sun May 20, 2012 5:33 pm Post subject: |
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| atwood wrote: |
| visitorq wrote: |
| northway wrote: |
| visitorq wrote: |
| Seriously, stop talking BS and step up to the plate. Name a single "bust", or better yet a depression (that was in any way on the scale of the great depression that the Fed caused) and was caused by the free market and not the government or central banking. You can't. Because you're wrong and know nothing about history or how the monetary system functions. Reading your drivel just is an embarrassment. |
http://en.wikipedia.org/wiki/Tulip_mania |
Thanks for proving my point. Tulip Mania was a result of massive increase in the money supply caused by the Bank of Amsterdam, the central bank of the Netherlands! It is considered to be the first central bank in history, so it's hardly a coincidence that its creation was followed by a massive speculative bubble.
Anyway, that one was too easy... For a more detailed breakdown, see this link: http://mises.org/daily/2564 |
So the banks forced people to buy tulips? |
Buying tulips was not the issue. Speculation was the issue. It was caused by an expansion in the money supply, which was caused by the government bank. Get it?
And before you give another smug, bone-headed response, remember that you were blaming it on the free market. I've clearly shown that it was not the free market. Take the government out of the equation, and there would be no bubble. You've yet to provide a single example that would prove the contrary. |
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visitorq
Joined: 11 Jan 2008
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| Posted: Sun May 20, 2012 5:39 pm Post subject: |
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| atwood wrote: |
| So hyperinflation in Germany was a contributing factor? Thanks for making my case. |
Debunking your nonsense point-for-point = making your case? Alrighty then...
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| Are you sure it's just the Fed controling the world economy? What about the Trilateral Commision, the Zionists, George Soros, et al? |
There you go again, bringing up subjects about which you know nothing.
| Quote: |
| As for your request, funny stuff. There is no true free market and never has been so what could it cause? Even for drivel, since you've got the market cornered on that commodity. |
Okay, so you concede that the free market cannot be to blame then? Good. Duly noted. |
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Unposter
Joined: 04 Jun 2006
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| Posted: Sun May 20, 2012 5:55 pm Post subject: |
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Come on people wake up! We need to listen to VisitorQ and his people are never responsible for things mantra. It makes life so neat and easy. Remember, it is always forces larger than themselves, like God and Government, that are responsible. Right?
People don't control themselves. We don't need ethics and morality. We just need to let the market forces do their magic. It is so simple, so logical, I'm surprised more people don't get it.
I guess it is the government-run education system. If we only had more freedom to break our chains and educate ourselves the ONLY TRUE WAY - yeah, that is the freedom I'm looking for. |
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