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Re: "americans distrust government"... [Re: Mr.Al]
    #11072474 -

Mr.Al said:
Spare me the pompous windbaggery that is a thinly veiled attempt to disguise your lack of economic understanding!

  "A thinly veiled attempt to disguise"?  And I'm a pompous windbag?
Quote:
We can take this apart piece by piece since you enjoy dodging questions so much.

 
What specific question would you like me to answer?  BY the way, you FAIL at taking apart "piece by piece".  Because you don't even try.
Quote:
First of all, it is fractional reserve banking which is the main impetus of the boom & bust economic cycle.


Fact not in evidence
Quote:
THAT IS WHY SAID CYCLES EXISTED BEFORE THE CENTRAL BANKS!

Given that depositors do not like it when banks loan out multiple times what they are holding (because that means the bank could fold and people lose their money!) the market response to this is a run on the banks.


There was a run on banks?  I missed that.  Further, banks couldn't pay interest if not for their ability to lend out to the point of expected shit returns.  Maybe you think depositors should pay the banks a fee for safeguarding their money.  Tell me again who has no understanding.  Fractional reserves aren't the problem per se.  Misjudging the required reserve is.  One clue provided free of charge.
Quote:


The fractional reserve banks created malinvestment in the economy due to the "easy money" they provided.  The loose lending floods the economy with extra cash (the M2 becomes M1, but it is MULTIPLIED in the process).  The extra cash flying around certainly makes it easier for people to buy, invest, hire people, expand businesses...  Things look real swell for awhile...


That would be of interest if the banks acted unfettered.  They don't.  Government has interfered in myriad other ways to corrupt a market that is not intrinsically flawed.  Like requiring lending to bums who otherwise would not qualify.  By the way, you seem to be proposing Sharia banking.  I'm not sure but it sure seems that way.
Quote:
UNTIL... 

Prices adjust to the influx of new money.  People find that their cash doesn't buy as much as it did before.  Companies start laying people off.

  Oh my godzzors, Homostasis and a feedback loop.  Excpet that you make quite the leap from people spending more to people losing jobs.  That one seemed a little...........odd.
Quote:
 

The economy is now entering the bust part of the cycle where businesses that were rash and foolish SHOULD go bankrupt!


ENTERING?
Quote:
 

The only way for the economy to correct itself is for the malinvestment to get cleared out of the economy so wealth producers can begin to ascertain what constitutes AN HONESTLY GOOD INVESTMENT and begin serious long term business planning.

  Yes
Quote:
Now, recall that influx of newly created money (new M1)  that was multiplied into existence from the M2...  The floor of prices throughout the economy have now risen.  Most of your hard working average Joe and Jane will now find that:



THEIR COST OF LIVING HAS INCREASED BUT THEIR WAGES HAVE NOT

I REPEAT HAVE NOT

INCREASED PROPORTIONALLY!


And it's going to get worse but it won't have one snot's worth of relationship to fractional reserve lending.
Quote:
DAMN IT ZAP, you may be old but you can still learn.  You have enough intelligence to understand this pay attention please  :fishsmack:

As the money supply is increased through the fractional reserve banking system (as well as ever growing government spending that forks loads of cash to very large corporations- Id Est: no bid Halliburton contracts) the wealthy and well connected ultra rich corporations hold a larger percentage of the money supply pie.  The American people hold a smaller percentage of the money supply pie and THUS FIND THAT SHIT IS MORE FUCKING EXPENSIVE THAN IT USED TO BE.


You have done absolutely NOTHING, in spite of your capitals, to support the position that a fractional reserve was responsible for the current unpleasant but not catastrophic correction.  You fail to address any of my far more germane and proximate causation, to wit, government social engineering vis a vis loan parameters.  You also fail to address my point about relative valuation of a particular currency.  You seem to be laboring, and I do mean laboring in the sense of struggling yet failing, to grasp that dollar valuation is relative.  Are you really so insane to think that it would be all wine and roses if the dollar was what the dollar used to be?  In the end, the true mark of value is not the dollar but the bread (metaphor, follow along).  As long as there is no radical change there is no real problem.  This the Fed has managed to do very well.  Modulate extreme swings.  If there is a specific question you would like me to address, pose it.  I'm wide open.  There was a point when I thought you might be more informed about loan markets but it is becoming more and more clear that you have no fucking idea at all.  Which is probably why you do nothing other than link to your beloved Austrian School.

You have failed to elucidate in any convincing fashion at all:
1.  Intrinsic weakness of a fractional reserve system without specifying what level of fraction is desirable.  Absent that we must move on to banks charging depositors fees to hold their money.
2.  That the federal reserve is not a modulating agent to overcome the inevitable brinksmanship of a competitive market.
3.  That Ron Paul has ever gotten anything passed in his entire career.
4.  That I don't know what I'm talking about but you do. Really, spare me the condescension or I'll get all windbag on your ass, Yo.
Quote:
Now examining your kindergarten response to why counterfeiting is wrong.....

Here is a more comprehensive look:


The counterfeiter receives the FULL BUYING POWER of the medium of exchange that is presently used in the economy.  As the COUNTERFEIT MONEY circulates through the economy the honest folk who work for their fucking money (you're one of those) finds that as prices adjust to the COUNTERFEIT money things get more expensive.


Thus the COUNTERFEITER gets shit for free at the immoral expense of the hard work of everyone else.



It is just as immoral for a government, central banks, and fractional reserve banks to work together and steal the value of everyday people's hard work. 

All of the above is a basic condensed version of Austrian Business Cycle Theory that was originally put forth by Friedrich A. Hayek (got a nobel prize for it).


So according to you, when the government, creator and regulator of the currency, prints more money it steals that money plus the money held by the people, right?  By making the money held by the people less valuable, right?  But if the government didn't print that money for its spending and just took it from the people for it's spending the people's dollars would each be worth more but they would have less of them.  Let me spell this out for you.  A bag of 50 marbles valued at $5 is worth exactly the same as a bag of 20 marbles valued at $5.  Or we can try it this way.  3 dollar bills valued at one loaf of bread is worth the same as 300 dollar bills valued at one loaf of bread.  You can still get only one loaf of bread.
Quote:
 
I know you are an older guy.  I feel kind of bad pointing out your lack of understanding because older people deserve respect and often lack (even just a little bit) some of the cognitive functions they used to.

  Whatever, junior.
Quote:
I HIGHLY RECOMMEND you look into and consider investing in some nootropics.  I have used piracetam, choline (you need choline with piracetam), and pyroglutamic acid lately.  Consider it an insurance policy for your mind.

The other nootropics I've tried can be too strong, more expensive, and very "speedy", so I can't recommend them unless "that's your thing".


Nullity, thy name is Al.


--------------------

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Re: "americans distrust government"... [Re: zappaisgod]
    #11072482 -

In case you had any doubt, Al, that was a lesson in taking something "apart piece by piece".  Thank me.


--------------------

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Re: "americans distrust government"... [Re: zappaisgod]
    #11075350 -

So according to you, when the government, creator and regulator of the currency, prints more money it steals that money plus the money held by the people, right?  By making the money held by the people less valuable, right?  But if the government didn't print that money for its spending and just took it from the people for it's spending the people's dollars would each be worth more but they would have less of them.  Let me spell this out for you.  A bag of 50 marbles valued at $5 is worth exactly the same as a bag of 20 marbles valued at $5.  Or we can try it this way.  3 dollar bills valued at one loaf of bread is worth the same as 300 dollar bills valued at one loaf of bread.  You can still get only one loaf of bread.

Quote:
Your thinking is erroneous because cost of living increases due to inflation of the money supply outpace by far growth in wages.



 
First of all, it is fractional reserve banking which is the main impetus of the boom & bust economic cycle.


Fact not in evidence
Quote:
Quote:
This fact was proven beyond any doubt by Austrian Business Cycle Theory


The fractional reserve banking system is what largely caused inflation of the money supply and thus creates the boom & bust economic cycle.  How can you fail to understand what causes systemic malinvestment in the market?  Is it mass hysteria?

http://mises.org/freemarket_detail.aspx?control=46


THAT IS WHY SAID CYCLES EXISTED BEFORE THE CENTRAL BANKS!

Given that depositors do not like it when banks loan out multiple times what they are holding (because that means the bank could fold and people lose their money!) the market response to this is a run on the banks.


There was a run on banks?  I missed that.  Further, banks couldn't pay interest if not for their ability to lend out to the point of expected shit returns.  Maybe you think depositors should pay the banks a fee for safeguarding their money.  Tell me again who has no understanding.  Fractional reserves aren't the problem per se.  Misjudging the required reserve is.  One clue provided free of charge.

Quote:
If you were a better student of U.S. history you would recall that runs on banks were quite common prior to 1913.  Fractional reserve banks would have to exercise extreme fiscal discipline to survive in a real free market.  Recall the recent housing boom & bust?  It wouldn't have gone that far without a central bank to prop the whole mess up.

 

The fractional reserve banks created malinvestment in the economy due to the "easy money" they provided.  The loose lending floods the economy with extra cash (the M2 becomes M1, but it is MULTIPLIED in the process).  The extra cash flying around certainly makes it easier for people to buy, invest, hire people, expand businesses...  Things look real swell for awhile...


That would be of interest if the banks acted unfettered.  They don't.  Government has interfered in myriad other ways to corrupt a market that is not intrinsically flawed.  Like requiring lending to bums who otherwise would not qualify.  By the way, you seem to be proposing Sharia banking.  I'm not sure but it sure seems that way.
Quote:
Quote:
No the fractional reserve banks don't go it alone zap.  When they fuck up royally the "federal" reserve has got their back and will make sure they never have to learn from their mistakes.  Yeshua violently threw the money changers out of the temple and today's central bankers are at least slightly more corrupt.

 

UNTIL... 

Prices adjust to the influx of new money.  People find that their cash doesn't buy as much as it did before.  Companies start laying people off.

  Oh my godzzors, Homostasis and a feedback loop.  Excpet that you make quite the leap from people spending more to people losing jobs.  That one seemed a little...........odd.
Quote:
 

Quote:
Quote:
W.T.F. do you think happened during the peak of the housing bubble when people were taking out upwards of six figure home equity loans on properties they bought a couple years before?  Like all artificial bubbles the prosperity wasn't based on an increase in real economic production.  The C.R.A. had an effect, sure.  But the real estate prices couldn't go sky high if it wasn't for the federal reserve providing the fractional reserve banking system with artificially low interest rates that we would NOT have seen in a market without a federal reserve.





The economy is now entering the bust part of the cycle where businesses that were rash and foolish SHOULD go bankrupt!


ENTERING?
Quote:
 

Oh yeah, the corrections have just begun.  Remember that interest rates are still ridiculously low so much of the painful adjustments are still being delayed...

The only way for the economy to correct itself is for the malinvestment to get cleared out of the economy so wealth producers can begin to ascertain what constitutes AN HONESTLY GOOD INVESTMENT and begin serious long term business planning.

  Yes
Quote:
Quote:
What you don't acknowledge is that the present system prevents these corrections from occurring. How can you not see that that destructive economic bubbles keep following each other and that said bubbles are financed by the easy money of artificially low interest rates?


Now, recall that influx of newly created money (new M1)  that was multiplied into existence from the M2...  The floor of prices throughout the economy have now risen.  Most of your hard working average Joe and Jane will now find that:



THEIR COST OF LIVING HAS INCREASED BUT THEIR WAGES HAVE NOT

I REPEAT HAVE NOT

INCREASED PROPORTIONALLY!


And it's going to get worse but it won't have one snot's worth of relationship to fractional reserve lending.
Quote:
Quote:
If the wages do not increase proportionately to the increase in money supply and fractional reserve banking creates massive inflation (that is the increase in the money supply) how does it not have everything to do with fractional reserve banking?



DAMN IT ZAP, you may be old but you can still learn.  You have enough intelligence to understand this pay attention please  :fishsmack:

As the money supply is increased through the fractional reserve banking system (as well as ever growing government spending that forks loads of cash to very large corporations- Id Est: no bid Halliburton contracts) the wealthy and well connected ultra rich corporations hold a larger percentage of the money supply pie.  The American people hold a smaller percentage of the money supply pie and THUS FIND THAT SHIT IS MORE FUCKING EXPENSIVE THAN IT USED TO BE.


You have done absolutely NOTHING, in spite of your capitals, to support the position that a fractional reserve was responsible for the current unpleasant but not catastrophic correction.

Quote:
Quote:
Horseshit zap, where did all the easy money that financed the malinvestment that caused the housing boom come from?




You fail to address any of my far more germane and proximate causation, to wit, government social engineering vis a vis loan parameters.  You also fail to address my point about relative valuation of a particular currency.  You seem to be laboring, and I do mean laboring in the sense of struggling yet failing, to grasp that dollar valuation is relative.  Are you really so insane to think that it would be all wine and roses if the dollar was what the dollar used to be?

Quote:
I have explained all of this in Austrian Business Cycle theory, which you refuse to talk about (probably because you don't understand it).


In the end, the true mark of value is not the dollar but the bread (metaphor, follow along).  As long as there is no radical change there is no real problem.  This the Fed has managed to do very well.  Modulate extreme swings.

Quote:
Modulate extreme swings?  No that's not right at all zap.  The federal reserve allows the fractional reserve banking system to create economic bubbles a.k.a. boom & bust cycles.  The federal reserve has made the "economic swings" much more severe given that it supports the fractional reserve banking system that causes the systemic cyclical economic malinvestments.


  If there is a specific question you would like me to address, pose it.  I'm wide open.  There was a point when I thought you might be more informed about loan markets but it is becoming more and more clear that you have no fucking idea at all.  Which is probably why you do nothing other than link to your beloved Austrian School.

Quote:
Let's have a discussion on A.B.C. theory if you are so confident that I don't understand the economic situation we are in.



I pointed out to you over and over that the average people are left HOLDING A SMALLER PERCENTAGE OF A MONEY SUPPLY THAT CONTINUES TO GROW THROUGH INFLATION.  Thus they become poor because the same work they do today doesn't buy what it used to years ago.

Quote:
As far as the fed modulating extreme swings...  Those toolbags have begun to monetize the debt they facilitated creating.  Have you heard about what happened to the Weimar Republic following WWI?  Oh right, they monetized their debt.....



I think you might like Gerald Celente zap:





You have failed to elucidate in any convincing fashion at all:
1.  Intrinsic weakness of a fractional reserve system without specifying what level of fraction is desirable.  Absent that we must move on to banks charging depositors fees to hold their money.

Quote:
If fractional reserve banking was in a free market individual banks would need to exercise discipline in order to survive.  The free market is hampered from fixing the problems in the banking system because of the federal reserve.  I don't think fractional reserve banking should be illegal.  I just think they shouldn't get bailed out by another bank that can create money from nothing.  It is idiotic to speculate on a "desirable level of fraction".  The UNHAMPERED FREE MARKET can calculate that changing numerical value.  I thought the fall of the U.S.S.R. would have taught you that central economic planning doesn't work...



2.  That the federal reserve is not a modulating agent to overcome the inevitable brinksmanship of a competitive market.

Quote:
Ben Bernanke is monetizing the debt as we speak and you call them a "modulating agent"...  That's some pretty impressive Kool-Aid you got there zap!



3.  That Ron Paul has ever gotten anything passed in his entire career.

Quote:
The bill to audit the fed has 270 congressional signatures.  If it passes the Senate it is veto proof.


4.  That I don't know what I'm talking about but you do. Really, spare me the condescension or I'll get all windbag on your ass, Yo.
Quote:
  I will admit that this is not the first time I have been accused of condescension.  It is occasionally difficult for me to realize when I am talking down to people.  This does not change the fact that you are generally (see, I am being kind) full of hot air.


Now examining your kindergarten response to why counterfeiting is wrong.....

Here is a more comprehensive look:


The counterfeiter receives the FULL BUYING POWER of the medium of exchange that is presently used in the economy.  As the COUNTERFEIT MONEY circulates through the economy the honest folk who work for their fucking money (you're one of those) finds that as prices adjust to the COUNTERFEIT money things get more expensive.


Thus the COUNTERFEITER gets shit for free at the immoral expense of the hard work of everyone else.



It is just as immoral for a government, central banks, and fractional reserve banks to work together and steal the value of everyday people's hard work. 

All of the above is a basic condensed version of Austrian Business Cycle Theory that was originally put forth by Friedrich A. Hayek (got a nobel prize for it).


So according to you, when the government, creator and regulator of the currency, prints more money it steals that money plus the money held by the people, right?  By making the money held by the people less valuable, right?  But if the government didn't print that money for its spending and just took it from the people for it's spending the people's dollars would each be worth more but they would have less of them.  Let me spell this out for you.  A bag of 50 marbles valued at $5 is worth exactly the same as a bag of 20 marbles valued at $5.  Or we can try it this way.  3 dollar bills valued at one loaf of bread is worth the same as 300 dollar bills valued at one loaf of bread.  You can still get only one loaf of bread.
Quote:
Quote:
No zap, your "logic" fails when we comprehend that as the money supply is increased individual wages certainly do not increase proportionally.  It is not as if some magical inflation fairy stuffs a little bit of extra cash into your wallet whenever the government decides to fire up the printing presses.  Go back to the counterfeiter analogy and attempt to show how the government is morally superior to some random jerk who has counterfeiting supplies in his basement.



 
I know you are an older guy.  I feel kind of bad pointing out your lack of understanding because older people deserve respect and often lack (even just a little bit) some of the cognitive functions they used to.

  Whatever, junior.
Quote:
Quote:
I was giving you some serious advice.  I see a lot of old folk with dementia and alzheimers these days.  There is some information suggesting that some of these substances can (to what extent we don't know yet) mitigate the effects of degenerative neurological conditions and perhaps prevent them outright...  Hey, if you don't want to try something that could drastically improve your quality of life that's fine.  It's your mind and you have the right to allow it to start slipping away from you.  I like debating with the older generation as the younger kids are too intellectually apathetic to even make a feeble attempt at a cogent argument.  The nootropics are dirt cheap.  http://www.amazon.com/Piracetam-Primaforce-Well-Being-Formula-500g/dp/B00113V1NK



I HIGHLY RECOMMEND you look into and consider investing in some nootropics.  I have used piracetam, choline (you need choline with piracetam), and pyroglutamic acid lately.  Consider it an insurance policy for your mind.

The other nootropics I've tried can be too strong, more expensive, and very "speedy", so I can't recommend them unless "that's your thing".


Nullity, thy name is Al.


No zap, you don't know me from Adam.


--------------------
Ludwig von Mises Institute,Campaign for Liberty.,The Oath Keeper's

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