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OfflinePhred
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Re: Ron Paul's Economics [Re: Wolfgang]
    #7773053 - 12/18/07 08:37 AM (16 years, 1 month ago)

In the opening post of the thread, Wolfgang writes:

Quote:

I like a lot of Ron Paul's ideas on things like Civil Liberties, but frankly his economic ideas are insane.




and

Quote:

Now I know that part of Ron Paul's ideas are to get rid of fiat currency (ie go to a gold standard). That economic ideas was rejected over 100 years ago, and since it was rejected, the country has enjoyed unprecedented economic growth and the lives of everyday Americans has undeniably improved greatly. Pretty much every country has experienced growth if they go to a well controlled fiat system over any kind of standard. To put it bluntly, his ideas just dont mesh with reality very well.




Agreed. This is one of the reasons no serious political analyst takes him seriously. When it comes to economics, the man is a crank. There are other reasons, too (his isolationist stance being probably the other major bone of contention with the Republican base), but his bizarre economic stance is reason alone to disregard him as a viable presidential candidate.

By the way, to give y'all some background on my own monetary views, for decades I held the opinion that using specie as currency (gold, silver, copper, perhaps platinum) had less disadvantages than using government-issued fiat currency. As a matter of fact, when I first started posting in this forum seven years ago I still held that opinion. But one advantage of posting here is running up against people with opposing views who are actually able to support their case. Links provided by some of these people over the years have led me to various economic sites which clarified my understanding of the pros and cons of each system, and after careful review and consideration I find it impossible to continue to defend the use of specie as currency in today's world. The Gold Bugs (of whom Ron Paul is one) are just flat out wrong, and I feel embarassed not to have figured out the flaws in their views on my own.

The second part of this article is pretty good at explaining the problems with returning to a gold standard. It's not exhaustive, but it's not crammed with economic jargon either. I suggest those Ronulans who are easily offended by any criticism of either The One Man Who Can Save America or of some of his loopier supporters just skip the first few paragraphs and head straight to the economics stuff, though.

http://frum.nationalreview.com/post/?q=NWQyYjc1ZjNjZTc5ZTcxODM1NDQ5ZDhhODZjZTU5YmQ=

I strongly recommend y'all take the time to read it, regardless of which candidate you may favor. It's not very long, but it's very informative.



Phred


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Offlinefireworks_godS
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Re: Ron Paul's Economics [Re: Phred]
    #7773148 - 12/18/07 09:27 AM (16 years, 1 month ago)

I haven't finished reading it yet, I just took some huge hits and need to focus on finer aspects of life :heartpump:, but a key point I have heard from Ron Paul regarding what he would do, regards introducing a new currency, to compete with the dollar :wink: I think that adds a new dynamic to the whole thing.... like a counter-weight, perhaps, Stability with speculation. :smile:


--------------------
:redpanda:
If I should die this very moment
I wouldn't fear
For I've never known completeness
Like being here
Wrapped in the warmth of you
Loving every breath of you

:heartpump: :bunnyhug: :yinyang:

:yinyang: :levitate: :earth: :levitate: :yinyang:


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Invisiblezorbman
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Registered: 06/04/04
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Re: Ron Paul's Economics [Re: Phred]
    #7773173 - 12/18/07 09:36 AM (16 years, 1 month ago)

In spite of my avatar (the idea there is to educate people on personal investments) you may be surprised that I am somewhat on the fence with the gold standard. I am leaning towards the gold standard but it is by no means a panacea. Both systems allow for economic instability and manias, but of different sorts.

Recessions and depressions are both possible with each system. Under our current system an Inflationary Depression can occur (which is what I'm betting on within a few years). Under a gold standard a Deflationary Depression is possible.

Pick your poison.

I would prefer a Deflationary Depression over the Inflationary one because the latter ends in the death of the currency. You can think of a depression as an illness in the economy- as painful as it is, imbalances are corrected in the end. But not if the patient dies!

The ID variety allows the official government propaganda and business news broadcasts to continue to trumpet how the economey is getting better, as all the "nominally" reported figures on incomes, GDP, production, etc. could continue to increase, as an ever-growing portion of the population heads to the Soup kitchens, the unemployment line, and the food stamp offices.


--------------------
“The crisis takes a much longer time coming than you think, and then it happens much faster than you would have thought.”  -- Rudiger Dornbusch


Edited by zorbman (12/18/07 09:42 AM)


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Offlineart
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Registered: 06/15/05
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Re: Ron Paul's Economics [Re: zorbman]
    #7773451 - 12/18/07 11:16 AM (16 years, 1 month ago)

Quote:

zorbman said:
Recessions and depressions are both possible with each system. Under our current system an Inflationary Depression can occur (which is what I'm betting on within a few years). Under a gold standard a Deflationary Depression is possible.






but it goes back to the federal reserve, my understanding of our economic system is that the federal reserve allows for a manipulation of the economy, which prevents severe inflation, or deflation. That is the federal reserves job, keep the economy steady. The gold standard makes it much more difficult to keep that equilibrium. So whether or not the federal reserve is "federal" is really irrelevant, they have kept us out of hard times many times (9/11 for example).


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OfflineSeussA
Error: divide byzero


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Re: Ron Paul's Economics [Re: art]
    #7773537 - 12/18/07 11:52 AM (16 years, 1 month ago)

> So whether or not the federal reserve is "federal" is really irrelevant, they have kept us out of hard times many times (9/11 for example).

Nothing in life is free. (Disclaimer: I am an idiot when it comes to this topic, so please, be gentle.) Are we not now paying the price for the moves the fed made when lowering rates after 9/11?


--------------------
Just another spore in the wind.


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Invisiblezorbman
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Re: Ron Paul's Economics [Re: art]
    #7773734 - 12/18/07 12:58 PM (16 years, 1 month ago)

Quote:

but it goes back to the federal reserve, my understanding of our economic system is that the federal reserve allows for a manipulation of the economy, which prevents severe inflation, or deflation.




In theory, yes. In reality, no.

Let me ask you something. Let's say I give you a printing press. And you keep in your basement. You use it to pay your bills. Would you be able to use it responsibly or would you have that baby smokin' like a crack pipe within days?

I would suggest to you that most people would not handle that power responsibly. Same goes for groups of people. They just dress it up a bit more in respectable language or jargon for public consumption.

That's what I like about a gold standard- or PM standard- it's fundamentally more honest. And we don't need to meet in secret on Dr. Jekyll Island to make it happen. It contains inflation, enforces fiscal discipline on government, and makes it much more difficult for government to fight needless wars. Iraq anyone?

Another thing to consider is that we've never been on a 100% gold standard in the U.S. So I don't think it is entirely accurate to blame a gold standard for our past economic problems.


--------------------
“The crisis takes a much longer time coming than you think, and then it happens much faster than you would have thought.”  -- Rudiger Dornbusch


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Invisiblezorbman
blarrr
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Registered: 06/04/04
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Re: Ron Paul's Economics [Re: art]
    #7773773 - 12/18/07 01:13 PM (16 years, 1 month ago)

This discussion is really moot because as a practical matter, the U.S. can never go on a true gold standard. The entire value of gold ever mined in the entire world is worth about $3.4 trillion, whereas the U.S. economy is currently valued at about $13.7 trillion.

http://en.wikipedia.org/wiki/Official_gold_reserves
http://en.wikipedia.org/wiki/United_States


--------------------
“The crisis takes a much longer time coming than you think, and then it happens much faster than you would have thought.”  -- Rudiger Dornbusch


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Offlineart
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Registered: 06/15/05
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Re: Ron Paul's Economics [Re: zorbman]
    #7774282 - 12/18/07 03:39 PM (16 years, 1 month ago)

Quote:

zorbman said:
This discussion is really moot because as a practical matter, the U.S. can never go on a true gold standard. The entire value of gold ever mined in the entire world is worth about $3.4 trillion, whereas the U.S. economy is currently valued at about $13.7 trillion.





that is why the value of gold changes, and is so unstable.

what is in the federal reserves best interest is in the peoples best interest. They do not want inflation/deflation just like we don't want it. Which is why they don't have the printing press smokin like a crack pipe. It would cause deflation, which would hurt everyone. Now I don't know about not ever being 100% on the gold standard, do you have anything to back that up? It would seem to me that whether or not you are completely on the gold standard is irrelevant. Wouldn't the same problems still apply? in fact, would they not be increased?

Yes, we are still feeling the effects from the lowered rates, but the question is what if they did not lower the rates? What if there was no federal reserve, then what would have happened, and what has happened in the past. It was the federal reserve that kept the economy steady.

The federal reserve is also extremely careful about mixing politics, and economics. I don't think they are nearly as corrupt as people think they are. People like Alan Greenspan are watched soooooooooooooo closely. There are people examining everything he does.


On a side note, do all of the Ron Paul supporters on the shroomery agree with his economic policies? or do they just view the social aspect as more important? I agree with him on many social issues, but his economic policies are just to radical for me to have any support for him.


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Offlineart
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Re: Ron Paul's Economics [Re: fireworks_god]
    #7774289 - 12/18/07 03:42 PM (16 years, 1 month ago)

Quote:

fireworks_god said:
I haven't finished reading it yet, I just took some huge hits and need to focus on finer aspects of life :heartpump:, but a key point I have heard from Ron Paul regarding what he would do, regards introducing a new currency, to compete with the dollar :wink: I think that adds a new dynamic to the whole thing.... like a counter-weight, perhaps, Stability with speculation. :smile:




stability with speculation? I have never heard of that before, isn't that an oxymoron.


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Invisiblezorbman
blarrr
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Registered: 06/04/04
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Re: Ron Paul's Economics [Re: art]
    #7774454 - 12/18/07 04:26 PM (16 years, 1 month ago)

Quote:

that is why the value of gold changes, and is so unstable.




Not at all. Take a look at the historical price of gold below. Up until 1971 the price was remarkably steady. In 1971 President Nixon canceled the Bretton Woods system and stopped the direct convertibility of the United States dollar to gold. The earlier blip occured in 1933 when FDR confiscated the gold of American citizens.



That's about as stable as you can get.

Compare that to the "stability" of the dollar:



Notice a trend?


--------------------
“The crisis takes a much longer time coming than you think, and then it happens much faster than you would have thought.”  -- Rudiger Dornbusch


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Offlineart
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Re: Ron Paul's Economics [Re: zorbman]
    #7774906 - 12/18/07 06:30 PM (16 years, 1 month ago)

so what exactly is your point with those graphs?
first of all they leave out a million other factors.

With the second graph is inflation/deflation taken into account?

what about the 1850's and the gold strike, and then the depression of 1857? now I don't think it was the gold standard that was the main cause, but from my understanding it was a big contribution.

and so how is the federal reserve supposed to regulate the economy without a sound supply of gold?

And, even if the gold standard is a fine way of doing things what makes it BETTER?


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Invisiblezorbman
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Re: Ron Paul's Economics [Re: art]
    #7775513 - 12/18/07 08:53 PM (16 years, 1 month ago)

Quote:

so what exactly is your point with those graphs?




Oh nothing. I just threw them up there because I thought the colors looked pretty.

Quote:

With the second graph is inflation/deflation taken into account?




NO. Obviously that would defeat the purpose of the graph. It IS inflation described in pictorial form. Sorry, but you really should educate yourself in basic economic concepts before you try tackling this type of subject. Baby steps..


--------------------
“The crisis takes a much longer time coming than you think, and then it happens much faster than you would have thought.”  -- Rudiger Dornbusch


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Offlineart
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Re: Ron Paul's Economics [Re: zorbman]
    #7775851 - 12/18/07 10:29 PM (16 years, 1 month ago)

you don't have to be an asshole.

so then what is your point? for the past two hundred years we have had inflation, so what! Inflation is not necessarily bad, nor is it necessarily good.
I am asking you to explain what your point was by using the graphs. I am real confused as to how they back up Ron Paul's economics, and on that note you have yet to respond to any of my other points on Ron Paul's economics. Now I never claimed to be an expert on economics, in fact I mentioned that I do not know much about economics, especially libertarian economics.

I have yet to see someone explain how the economy will work without the federal reserve, deficit spending, taxes, NAFTA/WTO, ect. So please almighty economic expert, enlighten me.


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Invisiblezorbman
blarrr
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Re: Ron Paul's Economics [Re: art]
    #7775916 - 12/18/07 10:59 PM (16 years, 1 month ago)

I thought I was being quite restrained.

Go back and re-read that post and this time notice what I was responding to when posting the graphs. Look, I don't see why I should feel obligated to respond to your every little question when you don't even grasp what I've posted thus far and fail to grasp the most basic economic concepts. That doesn't bode well for future discussion. No one else had any problem understanding it.

I can't tell if you're being purposely dense or just trolling the forum but my patience is low for people who haven't done their homework. No one is going to hold your hand and lead you through this if you don't pay them the courtesy of paying attention. :shrug:

And if you were paying attention you would also know that I haven't taken a hard-line stance in favor of the gold standard. I said I was pretty much on the fence about it. And I don't believe I've even mentioned Ron Paul so you're asking me to defend positions I do not hold. I am here to explore this issue and learn just like everyone else.


--------------------
“The crisis takes a much longer time coming than you think, and then it happens much faster than you would have thought.”  -- Rudiger Dornbusch


Edited by zorbman (12/18/07 11:19 PM)


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Offlineart
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Re: Ron Paul's Economics [Re: zorbman]
    #7775973 - 12/18/07 11:22 PM (16 years, 1 month ago)

what the hell are you talking about. how have I not done my homework, I know exactly what you were responding to. What don't you understand about your two graphs not proving that we should adopt the gold standard? How do I fail to grasp the most basic economic concepts? I understand inflation, you are the one who does not seem to understand that inflation is not necessarily bad! which is why I am confused by your graphs! they don't prove shit!
So if it is so damn basic then just fucking explain it.

I can understand you not wanting to take the time to examine every one of my points, but then don't criticize my knowledge of economics if you are not going to back it up. I didn't know that there were guidelines that restricted posts to being made only with a thorough knowledge of the subject. I thought part of discussing issues like these was to learn, and I was enjoying doing so in a none personal manner, which is why I kept coming back to this thread, so I am sorry if that is "trolling", or being "dense"


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Invisiblezorbman
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Re: Ron Paul's Economics [Re: art]
    #7776023 - 12/18/07 11:39 PM (16 years, 1 month ago)

Calm down.

You said the price of gold was very unstable. Notice that I quoted your assertion just before posting the graph showing it was in fact VERY stable historically up until the time Nixon took us off the gold standard. I wasn't making an argument for or against the GS- I was merely responding to your assertion.

I then followed up with a graph of what the performance of the US dollar was during much of that same period showing it's comparative instability.

You went on to ask if the dollar inflation chart was adjusted for inflation (you're gonna laugh at that one day) but failed to understand it WAS inflation! "Adjusting it for inflation" would be ridiculous when the whole purpose of the chart was to show the rate of inflation! That is why I was questioning your basic knowledge of economics and felt you might benefit from going back and solidifying your foundation before moving onto other topics. :shrug:

Sorry if I came across as rude. I am here to learn as well.


--------------------
“The crisis takes a much longer time coming than you think, and then it happens much faster than you would have thought.”  -- Rudiger Dornbusch


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Offlineart
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Re: Ron Paul's Economics [Re: zorbman]
    #7776092 - 12/19/07 12:05 AM (16 years, 1 month ago)

what I was pointing out was that there are many other factors involved in the economy. I am skeptical to the point made by the first chart, because I know that during the 1850's the gold standard caused a pretty big problem for the economy, being one of the causes for the 1857 depression. I know it has also caused a few other problems, so I was confused as to what exactly the chart proved? I was trying to get at the fact that the supply of gold is unpredictable. In the 1850's there was a huge increase in supply, now I don't know about specifics on how it affected the price of gold, but it must of had a pretty significant impact.
I know that there are many other factors involved, which was what I was wondering. It seems that if the graph is correct, then there must have been another reason for the problems in the economy during the 1850's as well as other times.


I was confused by the second graph because it is obvious that America has been going through inflation. I thought that surely there was another reason for the graph than merely showing the amount of inflation we have gone, which was my question. I understand the relationship between purchasing power, and inflation. What I don't understand is how it is bad. I know the devastating effects that inflation can have, but I also know it can be extremely useful if used right, hence why we have the federal reserve.

I know that you were responding to one specific point I made, but i am trying to bring everything together since they are all related.


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Invisiblebradmassive
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Registered: 11/03/07
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Loc: VA
Re: Ron Paul's Economics [Re: zorbman]
    #8093661 - 03/02/08 01:03 PM (15 years, 10 months ago)

I was gonna start another thread because I think Ron Pauls economic policies are the most sound I've ever heard. After watching him on youtube question the Fed directly its fun to see Bernake squirm and sidestep the comments. At some points Bernake even agrees in the face of what Ron Paul saying.



--------------------
"In the beginning, I had no name. i was a shape, a snarling shadow of the Old World which slipped into this existence" - Steven Erikson

"Our progress as a species rests squarely on the shoulders of that tenth person. The nine are satisfied with things they are told are valuable. Person 10 determines for himself what has value." - My good friend Za -


Edited by bradmassive (03/02/08 07:23 PM)


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OfflineNeanderthal
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Re: Ron Paul's Economics [Re: Wolfgang]
    #8094817 - 03/02/08 07:03 PM (15 years, 10 months ago)

Greenspan once fully advocated the very same policies that Rep. Ron Paul now advocates.

http://www.321gold.com/fed/greenspan/1966.html

As Greenspan once said, "In the absence of the gold standard, there is no way to protect savings from confiscation through inflation."

In essence, Greenspan disavowed his previous convictions and adopted the ideological charlatanism of the Federal Reserve. Or, to put it more bluntly, Greenspan sold out.


--------------------
"I will give you consciousness expansion that will turn your blood to ice water." -- Terence McKenna


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InvisibleWolfgang
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Re: Ron Paul's Economics [Re: Neanderthal]
    #8094881 - 03/02/08 07:13 PM (15 years, 10 months ago)

Interesting. :strokebeard:


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