A different issue perhaps! The army of lawyers leads us to consideration of transaction cost economics (given the impossibility of designing perfect contracts and the creation of further rent seeking opportunity). That's all built on the problem of asymmetric information; an issue that is typically ignored by the free marketeer!
Increasing profit is not the sole motivation in a free market or in capitalism nor is discrimination necessary for a profit to be obtained. In fact I'd argue the opposite because in the end discrimination reduces total profit as opposed to increasing it. By way of example let me address racial prejudice that results in discriminatory employment practices. Because of racial prejudice a person that is more qualified will be deemed less qualified for a position and someone less qualified will be hired. We can assume that the more qualified person would have performed better leading to greater success and profit by the enterprise but that person wasn't hired because of the color of their skin. The enterprise "loses" because of the racial prejudice costing itself profits in the long run.
You're essentially assuming the Chicago school approach is correct. The 'taste for discrimination' approach is rather naive as it requires market power for it to continue to exist (else the pursuit of profit will drive it out). The Marxist approach is an improvement as there is direct reference to the labour market and how discrimination can feed economic rents. This is just confirmation that you're adopting Becker's approach. It isn't actually a theory of discrimination; its a theory of the result of market power
No, I don't advocate the "Chicago School of Economic" thought nor do I advocate the Marxist approach that ignores "greed" where those controlling the economy will exploit they system to their own benefit. Even with micro-economic control under Marxism someone is always "in charge" and will exploit the economic system for their own personal gain. Marxism also ignores the fact that capitalism will always exist in any economy based upon supply and demand. The problem is that if it's black market capitalism then it's completely unregulated and that leads to greater abuse and economic oppression.
Yes, I'm done with this. RoundUp Ready contains chemicals which are toxic to humans and wildlife. That has been proven and up held up by a court of law, three times in French court. So, Monsanto promises not to bankrupt anymore conventional, organic and heirloom farmers, for violating patents from contamination... so up held by a court of law. Really? http://www.motherearthnews.com/home...to-over-seed-contamination.aspx#axzz2Z1MtSwZj http://www.osgata.org/ Family heirloom seeds are generations of developed seeds with specialties specifically catered to their customers needs and wants. When a GM contaminates those seeds, they become worthless to the family farms who rely on those heirloom crops to sell as organics. From a higher priced market to lower grade market as proven by the link and story I provided prior. Saying different is ignorant. Yes... we all volunteered for this experiment...? Here you show ignorance. You don't know that heirloom seeds are generational seeds, organic foods and crops are heirloom seeds that are grown in an organic method... meaning no environmentally altering methods used to produce the crop, just biodegradable and natural products. Heirloom seeds are far more expensive than GM's "plastic" seeds. Ahhh... so, it's ok for you to force your GM's into nature, contaminate three of the biggest crops in America... but not ok for me to cry foul because majority of foods out there now contain GM and I've lost 75% diversity as a consumer? Yes, this is a free market... as long as you eat GM's. Because, again, on the market, heirlooms and organics sell as such barring any GM traits, once a GM trait is found, the seed becomes garbage in the market as heirlooms or organics... and has to be sold into the market at a much lower grade seed along with the other GM's. Again, your missing the fact that these family heirloom seeds have been developed and sustained over generations... centuries even, developed specialties, and catered to specific consumers, which become worthless when GM's contaminates them... these are not easily replaced with just any old heirloom seeds. ...I think your lying... or you weren't that involved, ...at all... because it's obvious you know d1ck.
You had me at "French". Anyway you are on the fringe not even obama is with you. If you like organics use your backyard. That is what I did. I grow 27 fruit trees and plants, 22 spices and 9 peppers. Vegetables are too pest friendly for me to bother with. I would be more interested in discussing solutions on growing on getting whatever food you want rather then arguing something is dangerous when it is clearly not as used and mixed and you have no evidence otherwise. Arsenic is in every drop of apple juice you have ever swallowed etc.. Etc... Normal sized backyard, keep small trees.
No I did. Commune and everything. Didn't do much work in heavy machinery though I was young. Then I . Did some picking and worked at a green market selling from when I was 14 - 18. Sold white eggplant, made fruit smoothies etc..,
A fundamental problem is that most people are confined by thinking "in the box" as opposed to thinking "outside of the box" which is what is required. We address economic theories all of which attempt to resolve the problems though institutionalization of a "national" economic solution that ignores the simple fact that in almost all cases "the people are the problem" and not the system. We need a paradigm shift in looking at economies that focuses on the problem of "People" that based upon numerous reasons predominately create the problems with any "economic school of thought' that we might refer to. How do we change the "People" becomes the key question.
Your analysis into discrimination is Chicago School 101. That you don't recognise that only tells me that you need to put more research into the labour market explanations for discrimination phenomena
Yes, actually it is technically the same now. With the rise in debit and credit cards, no longer does the money supply have to match the GDP. When a bank makes a loan, no real money actually exchanges hands, it is all done electronically. What happens in a loan transaction? The bank issues a loan, but only has to back a certain fraction of it... Fractional Reserve Banking... this means that that 100 dollar loan is only backed by 10% of the banks reserves... or $10. Where does the rest of the $90 come from? It is simply made up on entry and the 90% of that loan is carried into to the banks books. No money was printed, but money created. A properly ran economic structure involves inflation that grows with the trade of goods and services (GDP). When fractional reserve is used with debt and inflation, bubbles are born... this creates periods of inflation and recessions. When money has no real value or a fraction of that value, and then charged upon interest on the full value, this process of money making money compounds the inflation of the monetary system exponentially... as proven by the value of 1913 dollar to today's value of a dollar. If the goods, services, and trade are continually growing, this is natural inflation that involves the gain of value over time. Properly measured, the purchasing power of the dollar should rise, much as it did in colonial times in the early settlements, as it bore no debt or interest on creation. It's all about funding. NASA was on the Moon forty years ago (almost a half century lost), the private sector is now just barely putting a man in orbit. NASA is an organization built upon the components, expertise, knowledge, and wisdom of the lowest bidder... your competition and my better answer to. So... your definition of a good and well educated society is burger chains and low education...? My definition of a good and educated society is high education involving the sciences, music and arts... I see why our educational system is slipping if this is the attitude of most Americans. ...all while they have healthcare, long vacations, short work weeks, ...education with the arts in schools. We have, no healthcare, 1% owning the wealth, metal detectors and security teams in grade, middle and high schools, limited family structure while a 40 hour work week is for many is a short week, limited vacation time per year, and are degrading and flushing out the arts in public schools, which has been proven to encourage better performance in math and science . Yeah, it's all peaches and roses, and pretty little flowers, for those who end up growing up in an impoverished region and similarly subjugated to flipping burgers and scrubbing toilets due to a poor educational system, serving burgers for the kids who grow up in a region where wealth grants them the opportunities of a better education. If this is you idea of "every man created equal" in "pursuit of life, liberty, and happiness"... you're being very short sighted. Isn't that the plight of it all? Student loans so outrageous that obtaining a simple degree will put you into debt for years and years to come... Why so outrageous? Because of our debt based monetary system that has diverted the resources available into interest baring servitude. Because the funding that could be available that come in the form of taxes are being sucked away to pay for the interest on the national debt alone. If your idea of an educational system is only to allow it to people who can pay for it, you have lost the plot to a civilized society. "Other data show that communities where student poverty is rare tend to have well-funded schools, whereas schools in communities where student poverty is rampant tend to receive much less funding. ...the relationship between funding and student poverty rates for school districts with enrollments of more than 1,000. Districts reporting higher levels of funding are more likely to be located in communities where student poverty is minimal, whereas those reporting lower levels of funding are more often located in communities where student poverty is sizable" http://www.ascd.org/publications/ed...qual-School-Funding-in-the-United-States.aspx You simply blur the lines then cross over them to make a statement. Obviously by my graphs and links which clearly show that even though the US claims to have the best health care in the world, they don't have the healthiest people because of health care. That's just simply is a fact. Touting we are the best just doesn't make it so. Yes, because the production and use of oil is known to release carcinogens and carries heavy metals... and practically everyone uses it on a constant basis. Welcome to America, home of the cancer cluster... Notice the clustering of clusters in the north east... http://nymag.com/news/features/32865/index3.html Ah, only cigarettes are linked to cancer and only America smokes them... gotcha, I'll pass that knowledge on to ...my dog. ??? You didn't even know what a debt based monetary system was... your motto was "STOP THE GOVERNMENT FROM SPENDING MONEY" or ... while my motto is, let the government spend, I want to get past this 100 year old infrastructure and get it on to something real... congress doesn't have to borrow that money to spend it. This is what the current fractional reserve banking system is already doing currently... why deal with a middle man you can't touch... go straight to the source and hold it accountable and responsible. Again, the power of the dollar should always rise with the natural inflation of goods and services... you know when a stock splits... this is what a dollar should do every now and then as well. The majority of what government spends is being compounded by interest... meaning the value of what it is spending is becoming devalued at every purchase. Some people will never actually grasp what 16 trillion dollars is. They will never grasp the value of it... much like they can't bend their mind around infinity or forever... it just becomes to big of a number for them to actually relate to. If we had 16 trillion dollars from 1913 represented in actual physical value, we probably wouldn't be here right now, but having a different discussion some where else in the solar system orbiting and studying a distant planet or it's moon, while our country was a mesh of high speed infrastructure filled with highly educated people, developing the future within the sciences, art and music. Really, because I don't like your food, and I don't like your car. In fact, I live in the same nation and don't want to eat GM's or burn oil. But I'm forced to a 75% diversity loss in the foods I can purchase, and I can not protect myself from the harmful carcinogens and heavy metals I must inhale on my way to work. But, I'm not forcing my way life onto anyone else, but it sure seems that you are forcing your life onto me. You must ask yourself first why most people are moving to the cities in the first place... is it not the activities of corporations that have relocated a lot of these people to begin with, and now you want to push the blame onto government because they lack the infrastructure needed, as corporations erect factories, obtain contracts and then shove people into them that are starving and needing to work to obtain food and shelter? But again, you want to blur the lines, then step across and claim... Generally not. Generally those who profit keep the money and give themselves bonuses. Neo-con-nazis, so ignorant, dull, and naive that they are easily manipulated that how they live is perfume and fairly tails... when it's actually flatulence and nightmares. Of course, when all they do is smell their own farts, they begin to think it's all rosey. And who flipped the bill for those workers who where led to that hopelessness and suicide? The corporations that sent the contracts that setup the factory, or from that kid buying the Iphone? ...all of the above. Yes, this is why GM's are so favored in European countries, and other civilized nations... because everyone wants to eat foods that are Roundup Ready. The US is still such a great industrialized nation that most of it's manufacturing is outsourced. "Capitalism is man exploiting man, [socialism and communism] are just the other way around", the inherent common thread between them all, is a monetary system. When you begin to understand the effects of the international money lenders, you will begin to see a very peculiar pattern arise. This very statement... I'm at such a loss, ...as if all my typing and the direction of others has failed to register in you. The government can create jobs and public wealth simply by distributing money/credit for a project, much as the bank can simply issue credit on a fraction (the cap has actually been lifted) of their reserves for a loan. The banks already print money in the form of credit that have no bases on actual value or wealth, this is what is driving a society into plutocracy and our republic out as the government struggles to keep up with the interest on the national debt through cutbacks in infrastructure, healthcare, education and public services. Sorry, but these things are needed for a civilized society... these are government programs that give people of limited opportunities a chance at pursuing life, liberty and happiness. Without these programs we would effectively euthanize the mental and physically handicapped, the elderly, and the dysfunctional. Restrict the opportunities of the poverty stricken, and leave naked, and hungry, the homeless whose populations consists one-fourth of veterans of the US military. These are the services that make up a civilized society, without them, we are no better than China. 250 Billion Dollars? Holy Crap!!! I didn't realize how much money we are wasting!!! 250 Billion!!! On interest? On nothing. Boy, if I was Uncle Sam, I'd put that 250 billion in a saving bond every year... and let it collect some compounding interest... cha' ching... we're out of debt and making money... ...isn't that how it works? LOL... I think you got lost in translation... yes... ok... lol... not everyone wants to be a mechanic. ??? solar plane flying around the world, day and night with... wait for it, I ride everyday, with solar charged... wait for it... people with AC and DC solar still use... wait for it... EV's that plug in don't need solar because... wait for it... I'm really keeping you in suspense aren't I... ... ...batteries, wow, yep, ...no kidding... funky things... I know. Have you seen one? Their pretty neat'o! They hold a charge from a solar panel and you can use it later when the sun isn't shining. Can you even imagine such a thing? When people start to realize that they can get appliances, and even air conditioners that are DC and can operate them free of per unit charge per second charge with a minimal upfront cost of a solar system, all while battery and solar technology gets better... you'll find most people start working their way in to locally produced solar electricity for their daily needs, as much as I have. So far to date I have sold 10 electric bikes and 3 solar stations, for me it's pretty amazing as it is just a hobby. ...I'm sorry, was it something I said? Yes, NASA is a nationally funded agency... The Federal Reserve is a private agency... one is of national interest, the other is of self interest.
You're forgetting that they had to remove ads here in the US claiming Roundup was biodegradable and safe for the environment, as well as they falsified documents and studies that were found to be fraudulent in US courts... how convenient for you.
You forgot to mention that nearly every food item you have eaten over the course of your life came from a RoundUp treated field.
The corn they are fed in feed lots is. Doesn't bother me, roundup doesn't scare me any. Use it near my fruit trees weeding sucks.
Yes, but I can't help but think promoting national interests at a federal level is more prevalent then funding one that is self interested at a federal level. If we could live without both under The Constitution and still have the achievements and advancements offered to us by an agency like NASA that would be even more of an accomplishment, but as you said before, free market is never fully achievable... nor would you want it to be. Roundup, An Herbicide, Could Be Linked To Parkinson's, Cancer And Other Health Issues, Study Shows "Of the more than two dozen top herbicides on the market, glyphosate is the most popular. In 2007, as much as 185 million pounds of glyphosate was used by U.S. farmers, double the amount used six years ago" Roundup and birth defects: Is the public being kept in the dark? "The pesticide industry and EU regulators knew as long ago as the 1980s-1990s that Roundup, the world's best selling herbicide, causes birth defects – but they failed to inform the public. - See more at: http://earthopensource.org/index.php/reports/roundup-and-birth-defects-is-the-public-being-kept-in-the-dark#sthash.YPpsobcp.dpuf" Multiple Births: Birth-Defect Rate Increasing "The number of babies born from multiple births who are affected by congenital anomalies has nearly doubled since the 1980s," "The researchers found that 3% of the total births reviewed were multiple births and noted a 50% increase in the multiple birth rate from 1984 to 2007. The prevalence of congenital anomalies from multiple births rose from 5.9 per 10,000 births (1984 - 1987) to 10.7 (2004 - 2007) per 10,000 births. Among the 148,359 births that involved major congenital abnormalities, 3.83% were from multiple births." Pesticide-Induced Diseases: Birth/Fetal Effects"The relation between maternal pesticide exposures and neural tube defects (NTDs) in offspring was evaluated in 184 Mexican American case-women and 225 comparison women. women who reported using pesticides in their homes or yards were two times more likely to have NTD-affected pregnancies than women without these reported exposures. " Sorry, that's pretty damning evidence in the contrary that RoundUp is safe.
If that were true, then no bank would ever fail. Lehman Brothers should never have failed. But they did.... because they couldn't just make up money. What you are saying here, I have never read anywhere in the past 10 years I've been studying economics. The $100 comes from deposits, or investors / bond holders. You deposit $100 at your bank. They take the $100, keep $10, and invest or loan out $90. No money is created. Now yes, there is an inflationary effect from the fractional reserve system. When you deposit the money, some of the money is in the system twice. It's under your account, and it's also in the loan. But physically speaking, there is still a static number of dollars. This is why the fractional reserve system has never caused hyperinflation, only printing money has. Give me an example. What country would you cite? Since the dawn of time, money has been used to make money. It didn't start in 1913, or at the end of the gold standard. So I don't see the logic of this claim. You just said a contradictory statement. Inflation is the devalue of money, not the gain of value. Currency naturally loses value over time, for a number of inherent reasons. Not gain. Gain is deflation. Deflation is histoical rarity, not the norm. Again, look at our national debt. You can't complain about the national debt, and being forced to pay interest back to those we borrowed from, and at the same time, praise NASA. It is exactly because we spent billions on billions on things like NASA, that we have $16 Trillion in debt. So *YOUR* definition of a good and well educated society is burger chains? You are not getting my point are you. In the UK right now, the tax payers, are paying $100,000 dollars (or 66,000 pounds), to get students a degree in music and arts. What kind of job do you get with an Art History, or Music Therapy degree? You work at McDonalds for minimum wage. Oh but they are highly educated!!!!!!! In something that has no value. I am in *favor* of education.... *IF* it's education for something useful. The problem, people are getting educated in things that have no use, and charging it off on the tax payers. Why do they do this? Because they are not the ones paying the bill. Tax payers are. If *YOU* support tax payers giving free bad education to students, then *YOU* are the one that want's people with $100,000 degrees in nothing, working at Burger joints. You just lied repeatedly. We have no health care? Only the 1% have all the wealth? All lies. You just lied that whole time. Nice fantasy world. Have you ever actually been to Europe? It's not nearly as good as you think. I've been there. I've seen how they live, and it's a massive step down from here. Garbage garbage garbage. I went to school, and I wasn't in debt for years. The reason students go into massive debt, is because student loans are so easy to get, and they screw around and party in school. Wise students, go through school with minimal debt, and earn a degree, and get a good job. Lazy stupid student, go there and party all year long, take out endless loans, instead of working a job, and then drop out because they don't want to do the work. When you sign yourself up for stupid, the only one to blame is yourself. The government doesn't have the money for endless spending. They can't print money endlessly without destroying the entire country. So the alternative is to borrow the money. Well shockingly, people don't lend money out, unless there is a payoff in interest. Again, we don't have the money. You can't buy the car, if you don't have the money. You can't rent the apartment if you don't have the money. The US Government doesn't have the money to fund everything you want. Sorry. No, it is a statistical fact. If you want to survive an illness, you have a better chance of surviving it here, than anywhere else in the world. You may not like be "happy" about it, but that doesn't change the facts. Sorry. Um.... all that showed was where the government was funding research? So.... more research is done in areas with more people? Shocking.... Irrelevant. It's a factor that is not controlled by doctors, regardless of what country does what. Are you suggesting that all non-doctor related factors in quality of health, are all completely equal in all countries, thus making a comparison of incident rates valid? Only a monkey would make that claim. Yes, if they did what your motto is, the entire economy, and the country would collapse into ruin. No, that's not true either. You seem to live in a fantasy world. Dude LOL ..... If you want to live in a Hippie commune, you can do so. If you want to live in an isolated patch of land in the middle of south America, you can do it! I have know people who did just that. Grew their own food, hid in stick houses, drank pond water, and lived out their lives in isolation. You can even go join the Amish. No one is forcing you to do diddly jack squat. You are just a complainy whiny person now. Shut up! Stop your whining! You have freedom here in America! You can go live an isolated bitter hermit life out in the woods of Montana, and no one will bother you! You seem to think that it's the job of corporations to follow you around and give you want you want. Wrong. People move to cities because there are jobs there. That's not the companies fault. And no company can "shove" anyone into anything. If I don't want to go to work tomorrow, I don't have to.... and there's not one thing anyone anywhere can do about it. Of course the difference being, that what you said was complete and utter lies, and what I said was the dead on truth. Too bad. Can't help you with that, if you want to remain ignorant. I'm done with this. You just went on rambling, without having a point. So.... I got better things to do.
I'm just going to make this quick, because I'm not sure if I can explain it to you... There does come a time when the bill is due... bailout. Tally sticks, colonial script. Yes, ...usury, money changers, ...Mathew 21:12 Unless I'm talking natural inflation that follows the natural inflation of people that is followed by the natural inflation of goods and services. ???Wars are costing us more than NASA ever thought about. http://en.wikipedia.org/wiki/Budget_of_NASA http://en.wikipedia.org/wiki/Financial_cost_of_the_Iraq_War Arts and music have been proven to advance math and science skills. I know, how sad... why would it cost them $100,000 to begin with? Denmark, I shouldn't have left. I agree, ...as to the relevance of the matter after. Yes, actually they do... but that wouldn't be the best way to go about it. And the less the same money will buy you in just a short few years. Because we are a society living in toxic waste... we have the worst health... but, again, where was our health industries to insure our health was environmentally protected as well? It seems other nations are way ahead of us... that equates to something... called... better. Which negated your argument that funding meant nothing... shocking... So, why did you? ...you were issuing cancer treatments as some misguided attempt demonstrate that the health care is #1... then when the issue of life expectancy arouse and the list of the top healthiest countries that was devoid of the US... you issued... ... as if to say, "cancer is only smoking related, and only drug addicts need healthcare" No, I'm saying, there is a better way... a way that doesn't stagnate us into endless perpetuation of endless consumerism. The way the forefathers intended. ...and you're my muse. Hey, pump monkey... keep sucking them off... keep those knee pads dirty... and keep your eyes closed... I live my life in a twin city, commute to work everyday, eat everyday... just like you. Except I'm not holding my mouth open waiting for Big Co to jam one in... they have (*)(*)(*)(*)(*)es like you to do that, that are naive, gullible, dull, complacent, and scared to change... like any other jail house whore. God, it's like trying to dig with a spoon... People are disrupted from regular life and displaced by land rights, territory disputes, and climate change. They just don't wake up one day and decide their going to leave there village of generations to go work some horrendous job in a city where they are being told to go. OH, thank god... because I don't think I was getting anywhere either.
You just contradicted yourself. You said a bank created money from nothing. So when the "bill comes due", why don't they pay it with the money from nothing? No answer. Got it. They still used money to make money. Try again. Now you are changing topics. Goods and services grow, yes. But the value of money declines naturally, regardless of goods and services. True and irrelevant to the topic at hand. Which is why so many music and arts majors are working at burger king. Try again, this time with more real life. Because there is no free-market driving down the cost of low value degrees. When the tax payers are on the hook for the cost, why would a school economize for a degree that has little value? I wish you had not left too. So another non-answer. Agreed. You are too ignorant of economics, and how printing money and inflation works. Go learn something, and maybe we can have a more informed intelligent conversation later. Especially if they print money as you advocate. More ignorance. It didn't show what you were claiming. Nor was it applicable to the prior discussion. If you can't converse logically, then you need to find something else to do with your time. Survival rates reflect the ability to the health care system to diagnose illness, treat the illness, and save the life of the patient. Survival rates directly relate to the quality of the health care system. A monkey would cite incidence rates, which have nothing to do with the health care system at all. Doctors can do nothing to prevent someone from getting cancer, or killing themselves with harmful life styles. What you say doens't matter. If the government were to endlessly print money, it would wipe out the economy and country. You are too ignorant on economic and how inflation and printing money works, to continue this conversation. Go learn something, and maybe we can have an intelligent conversation later. Lord knows you need a muse given how ignorant you are. The rest of your mindlesss blaw blaw blaw I deleted. Sounds like a fitting punishment for ignorance. Continue.... Which still has nothing to do with the conversation at hand. Absolutely. You keep advocating something that would destroy the country, and everyone else on this forum knows it, which is why even other people on your side of the political spectrum are not supporting this insane concept. You need to go learn something, so you are not this ignorance. Go learn some basic economics, and how printing money and inflation work. Maybe you will come across less accurate to your avatar in the future.
This is called a bubble. Meaning, you'll never get it. History... it is only good if you know it. Natural inflation is what I referred to in the beginning. The Renaissance Period... highly educated society. When "competition" fails to lower the cost, blame it on school funding. Yes, I'm totally ignorant of how a debt based monetary system works or what a bond is. Credit. When found at fault, divert. Preventative medical practices. When unable to comprehend, divert. I know, right? When unwilling to research, divert. A concept that built the colonies into an independent nation. ...and delusion will keep your world pretty and pink, just the way you like it.
That is not "fractional banking" as the "money" exists already. In fractional banking the bank can "borrow" 9-times as much "money" from the Federal Reserve than it has in assets. For example a back can have $100,000 in deposits and borrow $900,000 from the Federal Reserve. It keeps the $100,000 in deposits and loans out $900,000 it borrowed from the Federal Reserve. It pays the Federal Reserve the "prime interest rate" on the money it borrows and loans out that money at anywhere from 3-times (e.g. a mortgage) to 28-times (e.g. a credit card) the interest rate that it's paying to the Federal Reserve. The problem is that the Federal Reserve doesn't have the money to loan to the banks but it does have the legal authority to create by fiat "Federal Reserve notes" based upon the promissory note from the bank. Basically the "money supply" has increased ten-fold and the increase in the "money supply" puts more "dollars in circulation" that then actual number of dollars that really exist. But that is not really what "inflation" is all about and many misunderstand what inflation really is. Inflation is really a reflection of the discount rate for a promissory note. Just like a mortgage note or a credit card note is discounted when they are traded so are Federal Reserve notes. The "discount rate" is a reflection of how hard it is to redeem the promissory note for that which it promises. Since the mortgage crisis I don't know what the discount is on a mortgage note is but it used to be about 5%. One bank or financial institution would purchase the "mortgage note" at a 5% discount from the holder of the note so a $100,000 mortgage note would sell between financial institutions for about $95,000 because it was a "secured note" backed by real estate. A credit card note was typically discounted about 50% because they are typically unsecured notes that were much harder to collect the full value of the promissory note. A Federal Reserve note is discounted about 97% because of the difficulty in fulfilling the "promise" of the note. A $50 Federal Reserve note literally promises redemption in a $50 American Gold Eagle or one-ounce of pure gold. As of this morning an $50 American Gold Eagle is trading for slightly more than $1,300 in Federal Reserve notes so the "free market" discount rate for a Federal Reserve note, as of this minute, is 96.2% because that is the relationship between what a Federal Reserve note promises and the actual redemption of the promise. What is being referred to as "inflation" is really the discounting of the Federal Reserve note as a promissory note in the free market. Real inflation is caused by an increase in the actual "money" supply but people misunderstand what money is. They confuse "money" with "lawful money" generally. The actual money is the gold (or silver) used for coinage and the coinage is "lawful" money. The amount of gold reserves in the world has doubled since 1950 so basically the "money supply" had doubled while the "lawful money" supply has not. If the lawful money supply doubled then there would be "inflation" if all other factors remained the same (e.g. no population growth) because there would be more gold coinage without any other changes. As it is, because of population growth, there hasn't been any real inflation related to "money" in the world economy. What has occurred is that the huge increase in the fiat currency, and the free market relationship between the promissory notes and the money, the discount rate has increased which results in the trade value of the currency declining. That isn't actually inflation but instead reflects the discount rate of a promissory note in the free market. An "ounce of gold" that is money still has roughly the same trade value today that it had in 1950 so there hasn't really been "inflation" related to the "money" but instead we are experiencing the discounting of the trade value of currency.
You have proven to me that you simply are not educated enough on the topic at hand, to make a rational debate. You are dismissed sir. Please go learn something about economics, inflation and how banking works, so that you can comment without being completely ignorant.
No bank invents money, that does not exist, and loans it. All fractional reserve banking, requires the bank have the money to begin with, and then loans out most, but keeps a fraction in reserve, as an offset to deposits. I know of no one anywhere, that has ever advocated that banks simply create money from thin air. I am very open to this concept, but this is the first I've heard of some of this. For example, banks borrowing from the Fed the way you describe, is not how I understand it. The Federal Reserve holds deposits from banks. Banks then will borrow from each other, THROUGH the Federal Reserve. So the borrowed money is not created, or fabricated by the Federal Reserve, but rather existing cash, that existing banks have on hand. The only time that I know of where the Federal Reserve itself directly loans cash, and thus has to create such cash from the US Treasury, is when the bank simply can't borrow money because they are too risky for other banks to take the chance on. Thus they have to go to the "Lender of Last Resort" which is the Federal Reserve itself. For example Lehman Brothers, had to borrow from the Fed, because all the other banks refused to lend to them anymore. But I have never heard of the Feds inventing money as standard practice for loans to banks. Do you have any suggestion for where I can read up on this?
