Yrat said:

Falcon91Wolvrn03 said:

So if I buy a bond, you're saying that I'm not actually using my real money, I'm signing new money into existance???  That only applies if the Fed is buying the bonds, as I already stated.

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are we talking bonds or loans?

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Falcon91Wolvrn03 said:

Yrat said:

so government hands out depreciated dollars to the poor, making them poorer, while moving value upwards to a wealthy elite, all at the expense of the middle class.  how is this NOT widening the gap between rich and poor?

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Lots of errors here.

First of all, the people receiving Government money get it at full value; it doesn't go down until after it has a chance to go into circulation
Second, inflation is typically only about 3% per year, so even after a year, it only loses 3% value.
Third, if someone is given $100 by the Government, and it loses 3% value, it doesn't make them poorer, it makes them $97 wealthier.

I have no idea what you mean when you say value moves upwards to a wealthy elite when the dollar depreciates.

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Mr.Al said:

I will make this as simple as possible for you.

When the money supply is increased the well connected receive funds from the government in a greater proportion than the rest of the population.

Sure each individual dollar's buying power is decreased over time.  What matters is that poorer folk are holding a smaller slice of the monetary pie (money supply) than those who initially received the funds.

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Mr.Al said:

That wiki is b.s.

The fed started with a meeting of private bankers on Jeckyll island in 1910.


The asshole Bernanke refused to tell Congress exactly where and in what amounts bailout money went to.

That is why they are going to be Audited.

How can you not see the incredibly levels of corruption and outright theft they are capable of?

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Mr.Al said:

The creation of new money confers no social benefit - Murray Rothbard Can you contend with that statement?

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Yrat said:

you openly admit in a prior post that inflation moves value upwards to the well-connected, and then in the next post you say "I have no idea what you mean when you say value moves upwards to a wealthy elite when the dollar depreciates."  i don't get you.

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Yrat said:

and the fed certainly DID make a profit last year.  ask zouden about it.  i know he's done the research.

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Quote:

The Federal Reserve System is an independent government institution that has private aspects. The System is not a private organization and does not operate for the purpose of making a profit...

All profit after expenses is returned to the U.S. Treasury or contributed to the surplus capital of the Federal Reserve Banks (and since shares in ownership of the Federal Reserve Banks are redeemable only at par, the nominal "owners" do not benefit from this surplus capital)

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Yrat said:

so someone receiving a welfare check for $100 one month, and $97 the next month, does not somehow witness a decrease in purchasing power?

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Yrat said:

by the way, that 3% inflation rate is complete bullshit.  did you know the CPI is constantly altered, changing the goods it measures, so that inflation can be reported as low?  what good is even bothering to measure inflation if you can change which prices to measure to suit your desired outcome?

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Mr.Al said:

If you don't think well connected individuals get money from the government you have been living under a rock for years.  The recent Wall Street bailout and auto bail are examples of this.  Goldman Sachs received large sums of money and the Treasury secretary at the time, Henry Paulson, used to work for them!  Certainly that is not "questionable" in the slightest... 

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Mr.Al said:

It's historical fact that a group of private bankers met on Jekyll island in 1910.  They backed Woodrow Wilson's presidential campaign financially.  Wilson supported the "fed's" takeover of the money supply in 1913.  It's not a conspiracy theory.  It is a conspiracy fact.

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Mr.Al said:

Given that the debt grows more unsustainable, said debt could become monetized.

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Mr.Al said:

Did you know that the fed had recently monetized some of the debt?

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Mr.Al said:

Weimar Republic monetized all their debt, it caused hyperinflation...

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Mr.Al said:

No group would have the ability to create new money and hand it over to thieves, that is the difference.

Inflation is the most insidious and dangerous form of taxation.

It would not be feasible for them to set up a tax to hand over money to their corporate friends.


Giving our money to Goldman Sach's is robbery.

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Mr.Al said:

Fact is, how do we know what they are doing with the money supply when they refuse to even tell Congress?
Again, why do you think H.R.1207 was written up?

We don't know what they are doing with the money supply.

That is why we are going to Audit the fuckers!

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Mr.Al said:

When China & Russia are putting together a currency basket to flee from the dollar, W.T.F. makes you think that the damn dollar is stable???

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Mr.Al said:

You say that monetizing "some" debt is "acceptable"?!? What makes you think that idiots won't monetize more?!?

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Mr.Al said:

It is too fucking easy to amass unsustainable debt with this idiotic keynesian system!!!!!!!

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Mr.Al said:

Again,


http://www.youtube.com/results?search_query=Bernanke+moron&search_type=&aq=f

Bernanke, the fed chair and prominent keynesian pseudo "economist", is an abject moron.

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Mr.Al said:

Bernanke was the brainless idiot who has begun monetizing debt.  Shortly after that China, Russia, and Brazil started nervously moving away from the dollar....

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Not true.  China is buying more US bonds than ever (see the treasury bond curve):

Mr.Al said:

The idiots at the fed and the politicians in their pocket, like the teleprompter reader/ media whore, don't know what the fuck they are doing because they ascribe to an economic model that is NOT SUSTAINABLE OR LOGICAL.

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Falcon91Wolvrn03 said:

Again,


Bernanke, the fed chair and prominent keynesian pseudo "economist", is an abject moron.

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Mr.Al said:

This might help you Falcon:


The medium of exchange  is used to create efficiency throughout the economic system.

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Mr.Al said:

Efficiency of production eventually leads to post scarcity.

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Mr.Al said:

Profit creates more efficiency through investment in higher technology.

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Mr.Al said:

Credit and saved money operate differently in the market because new money did not come as a result of previous increase in economic efficiency (increase in volume and quality of production).

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Mr.Al said:

Giving money to inefficient bankrupt companies decreases the economic efficiency of the entire economic system.  It is the long term effect of destroying the buying power of the medium of exchange.  It is foolish to think that rewarding failure is a good idea, economically speaking, but that is keynesian economics.

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Mr.Al said:

It makes no sense at all to support the existence of the fed and yet say that it is wrong to reward failure, because that it exactly what the fed does.

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Mr.Al said:

This explains why the Austrian school talks about the "medium of exchange" and "the creation of new money confers no social benefit".  The keynesians attempt to create false prosperity through inflation of the money supply.

http://mises.org/journals/aen/aen19_3_1.asp

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Quote:

I asked him (Lachmann) about Mises, and he said that Mises was a very stubborn person who didn't make enough of an effort to understand Keynes. If he had made more of an effort, he wouldn't be as negative toward Keynes.

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Yrat said:

yeah, a real winner we have there

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And how long has the Austrian school predicted the collapse of the US dollar???    That school's a real winner.

Falcon91Wolvrn03 said:

Yrat said:

yeah, a real winner we have there

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And how long has the Austrian school predicted the collapse of the US dollar???    That school's a real winner.

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Yrat said:

Falcon91Wolvrn03 said:

Yrat said:

yeah, a real winner we have there

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And how long has the Austrian school predicted the collapse of the US dollar???    That school's a real winner.

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time will tell

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Mr.Al said:

Keynesian "economics" calls for central economic planning and central banks.

Central planners and central bankers have been responsible for the immoral bailouts.

If you support Keynes' economic system you support that behavior because his system makes it possible.

Are you schizophrenic?

You agree that the medium of exchange and the drive for profit that comes with it is what causes efficiency throughout the economic system.


How hard is it for you to comprehend that when you have an economic system that hands over large amounts of money to inefficient individuals and corporations we see INEFFICIENCY develop in the market.  The central planners reward failure through welfare.

If we create more inefficiency through welfare (rewarding failure) we set the stage for more inefficiency.

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Mr.Al said:

You see that politics causes problems in the economy through bailout programs.

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Mr.Al said:

What about artificially low interest rates?  Sure, politicians use artificially low interest rates to create false prosperity.  What you fail to see is that they use the central bank to create the artificially low interest rates.  This precipitates the boom/bust economic cycle and the massive malinvestment (systemic market inefficiencies) that comes with it.

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Quote:

But on Thursday, almost three years after stepping down as chairman of the Federal Reserve, a humbled Mr. Greenspan admitted that he had put too much faith in the self-correcting power of free markets and had failed to anticipate the self-destructive power of wanton mortgage lending.

“Those of us who have looked to the self-interest of lending institutions to protect shareholders’ equity, myself included, are in a state of shocked disbelief,” he told the House Committee on Oversight and Government Reform.

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Mr.Al said:

Now, we are mutually acknowledging that creating money does not create wealth.

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Mr.Al said:

YOU CLAIM THAT KEYNESIAN ECONOMICS IS NOT LIKE THAT, WHICH IS PURE HORSESHIT.  KEYNES CALLS FOR MASSIVE DEFICIT SPENDING DURING ECONOMIC DOWNTURN, THIS IS THE CAUSE OF THE DESTRUCTIVE BUSINESS CYCLE ITSELF.  How can you not see this?

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Mr.Al said:

Regarding Lachmann's criticism of Mises and Austrian Business Cycle Theory:

Lachmann view was that people in the market would not precipitate a bubble due to the assumption that they should understand that it leads to a bust.

Lachmann is clearly wrong.  He is wrong because malinvestment and business cycles do happen. 

Essentially, the economic reality proves him wrong.

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Mr.Al said:

I HAVE NOT SEEN ANY INTELLIGENT REFUTATION OF A.B.C. THEORY.

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Mr.Al said:

I think that the reason why is that when people attempt to refute A.B.C. theory they are not examining reality, meaning real world situations. They suppose imaginary constructs and attempt to make it fit what is happening instead of starting with observing exactly what the fuck is going on.  This is the failure of idiots like Ben Bernanke.  They hold tight to what they have been indoctrinated to even when reality proves them wrong countless times.


Bernanke is wrong because his dogmatic assumptions prevent him from examining reality.  He does not change even though he was dead fucking wrong.  Your non-leader reappointed the fool.  It is hard to say which of the two is more of an idiot.

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Mr.Al said:

This is from the Frank Shostak interview, just so you can more completely understand business cycle theory and see how Lachmann's psychological assumptions do not fit with economic reality.


AEN: How does this apply in the context of business cycle theory?

SHOSTAK: Writing in Economica in 1943, Lachmann criticized Mises's theory of the business cycle on grounds that expectations could prevent it from taking place. The idea is that businesses expect the bust and refrain from investment expansion, thereby muting the impact of new money coming into the economy. Hence, the business cycle is recast as an information- coordination problem rather than a theory about cause and effect.

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Mr.Al said:

The incorrect assumption here is that bad expectations are somehow the cause of the business cycle. The actual cause is the introduction of counterfeit money, which redistributes wealth and leads businesses to make calculation errors. You can have any kind of expectations you want but they will not and cannot obviate past events. This new money is an economic error which must work itself through the economy in some way.

You cannot use psychology to explain the consequence of real events. What people believe about the future cannot change the reality of cause and effect. The business cycle is a consequence of a real act of damage that, once set in motion, cannot be undone. Guido H�lsmann prefers to recast the business cycle theory into a general theory of error cycles, which gets to the core of the issue at hand: government intervention leading to bad decisions.

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ArmFromTheAbyss said:

Your whole thesis depends on the market somehow being smart enough to know exactly how much money is "printed."

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