A Mental Walkthrough on how the United States monetary system actually works!

With inflation, you are creating losers: you are forcing people to not make bad decisions with their wealth, or the risk is that they lose it. It is literally the quintessential "flipping a guy upside down and holding him by his ankles to see what shakes out".

It is robbery. It is an unaccountable authority (The Fed) harnessing all of humanity - enslaving it - to guarantee themselves a profit.

And it's wrong on every moral level. Your idea of how to run a currency sucks balls.

 

I didn't say it is necessary. But controlled inflation definitely leads to more money exchanging hands which leads to more demand, which leads to hopefully more productivity. It is not theft whatsoever. Just because you think you own something that is not yours does not mean they are stealing it from you. It is all of ours. It is our medium of exchange. It is not meant to be kept or locked away to hide from everyone else.

It is the oil that drives the economy. We will never ever in the future of America do anything different than we do now in terms of inflation. We will always strive for controlled inflation because that is required for the economic growth we want to accomplish. There is no good that comes out of making a medium of exchange profitable to hold on to

 

Medium of exchange is not wealth. You are forcing people to make decisions with their medium of exchange. The fact that you understand that your money is going to lose value is exactly what makes our system so robust. You are going to do "something" to attempt at making more money in the future, whether it's investing in the stock market, buying gold, buying a house, purchasing treasuries, investing in a business, etc.

The bottom line though, is that there is an underlying pressure to get rid of your money. That is exactly what we want. You are proving that the system works the exact way it should. If you had no fear that your money would lose value than you wouldn't have any urgency to do anything with it and it would keep it away from the rest of the country.

How selfish are you?

 

History has proven that all societies have failed regardless of their currency. So nice logical fallacy there.

Listen, I understand you guys think you know what is best. But what you advocate would be detrimental to an economy. Which is exactly why you can not point out a single economy that uses your system that is not a 3rd world country.

Fiat money is used to promote maximum productivity. Commodity based and fixed currency systems promote fixed growth levels of productivity. Which is exactly why everyone abandons them. There is no reason a country should limit it's productivity based on how much of a shiny metal it has. You would not want Zimbabwe to stumble on a massive mound of gold and take all our production and innovation just because they found something in the ground.

Our greatest commodity is human capital. Fiat money just allows us to maximize our human capital and grow in to the largest economy in the history of mankind. Statistics are not on your side. America is MASSIVE!!! We produce and consume more than a quarter of the entire world and consist of less than 5% of the entire world. We are the epitome of economic prowess. And the fact that you guys still dwell on the 1800s because we were on a gold standard is mind boggling.

 

You are mistaking 'robust' for 'rigged'.

We had an extremely robust economy before we created a manipulated currency. It is one thing for the US Congress to be in direct control of the minting of our currency, and another to allow a rogue entity to do it - for a profit.

If a system can be manipulated through inflation to - as you say - "force activity" guarantees that upper classes will be better at it, and lower classes will be worse at it.

You are identifying the exact problem that causes the chasm between classes, and you're not even aware of it. It is YOUR ideology and belief system which is causing the growing gap between rich and poor.

And you STILL don't. even. know. it.

That happens anyway, through hard work. The problem is that an inflationary currency creates greater stakes: bad decisions result in more crushing consequences; good decisions result in hyperactive growth.

Again: class stratification.

No, that isn't what we want: to the degree that such forced currency velocity creates a mechanism through which bad decisions cause undue harm.

Class stratification.

That is nonsense. Even keeping it in a bank doesn't accomplish that; doing so amasses the wherewithall by which banks loan it to others to allow them to flower their intellectual capital, which is the real wealth.

How stupid are you? I can guarantee you that nearly no one is thinking about spending their money because it's not going to be worth as much in the future. That's addled logic at its core.

 

Our monetary system is a just giant scam that is meant to enrich the elite at the expense of the working classes.

Anyone who says otherwise is a tool or an ignoramus.

 

What? Are you serious? What is your definition of "robust"? Mine is productivity. We had a quarter of the world's productivity last year. We have the largest consumer base in the entire world. We have more billions than the next 9 countries combined, we have more car owners, more home owners, more cell phone owners, we have the largest entertainment industry, sports industry, etc, etc.

What in the world do you consider robust? You consider the 1800s robust? Lol.

Upper classes are better at making money regardless of inflation. Read some history books.

I understand the gap is widening. That is a problem. But that is a fiscal problem. Raise their taxes and spend more money. The middle class will prosper.

That happens regardless of the system. What I don't understand is why you guys think the poor and lower class were better off under the gold standard. They were disease ridden slaves to the capital owners. There has never been a system were the poor have been as spoiled as ours right now. You think the poor in the 1800s wouldn't salivate over our current economy???

Get real. You guys are living in la la land.

It creates the movement of money. This creates demand, demand creates supply, welcome to econ 101.

This is how little you know about our economy. Banks don't lend your money.

HAHAHAHAHAHAHAHAHAHAHA!!! Wow... is this serious??? You must be poor.

 

If it's a scam than I love the scam, because for some reason me, my family, and all my friends have benefited tremendously from the scam along with millions of other American's. Life is about utility. You are too infatuated with what money was worth in the past. Live in the present, not in the past.

 

Exactly. And it is precisely the cause of the ever widening chasm between rich and poor.

 

You have yet to establish that your vaunted inflationary system is the sole reason for the wealth, and you've yet to acknowledge the clearly evident downside.

 

The only people who are truly benefiting from our monetary system are the super-elite bankers, speculators, and land owners. Everyone else is getting hosed through inflation and recessions.

And you are the one living in the past. It is you who has bought into the fallacious socialist notion of central planning.

But you were brainwashed in college, so there is no reason to think you'll ever change your mind.

 

I never said inflation is the sole reason. Productivity is the sole reason. Inflation simply is a tax on idle money. Which makes people not want to have idle money. Economic growth is about transactions, it is about you doing something to get what you want. Money is simply the medium of exchange. Everything from books, Justin Bieber, cars, toys, movies, oil, etc, etc is what makes America so massive. We spend our money and we have the best products.

That is all that matters. I could care less what money was worth in 1913 if I myself can get whatever I want right now. Life is about utility not about the medium of exchange.

 

Land owners, super-elite bankers, and resource owners benefit the most from any monetary system. You are acting as if the poor have always been able to find work and prosper. Get real... we have the most robust economy in the history of mankind.

You have the right idea in your head and your cause is just... but your rationale and logic is just not there. Your system would hurt everyone, especially the poor and the middle class. The only people the gold standard would help our resource owners.

 

Without a doubt. Corporate profits have been hitting new historical highs since the recession began and - surprise, surprise - it's the financial sector that is getting the lion's share.

Of course, it's not hard to make hundreds of millions, even billions of dollars, when you have preferred access to privileged information, government contracts, and new capital.

 

No, they benefit the most from whatever monetary system they can control and manipulate the easiest, which is the system we currently have.

No, I am not acting that way at all. Please try to control your inclination to misrepresent others. I know it's extremely difficult for you not to engage in intellectual dishonesty and logical fallacies, but you'll just have to try anyway.

Yes, but it has nothing to do with our monetary system.

You don't even know what kind of monetary system I support. I tried to explain it to you once, and I even provided a free E-Book written by a Nobel Laureate, and you simply ignored it and trolled the thread like you always do.

 

They have always and will always benefit the most from whatever monetary system there is. The working class and the poor do not benefit from a fixed commodity standard like gold. I can't even comprehend why you think such.

This means nothing

Explain...

You are an Austrian if I recall who supports a competing currency system. I think? If that is still true, then you have not learned much since the last time we discussed.

 

So? This is non-sequitur, as you're not comparing a fiat currency country to non-fiat currencies!

Again: this has not-a-dămned-thing to do with the nature of our currency, as it's shared by EVERYONE in the world.

What you're identifying are those unique characteristics of our culture, formed from equal parts Judeo-Christian work ethic, and a solid recognition of God-Given rights protected under the Constitution to foster life, liberty and the pursuit of happiness.

To the degree those core principles remain is the degree to which we will outperform the rest of the world.

It doesn't have SQUAT to do with our fiat currency, nor the inflationary pressures it creates.

Um...yes. I do. Why wouldn't you? Denying that the US rocketed to economic relevance from our founding to 1900 is pure idiocy.

Not before you re-read what I said, because NOTHING that I said denies that. What I said is that economically operating under a fiat currency creates a force multiplier of that fact, while also having the opposite effect on those who aren't as gifted at the ability to congeal and multiply wealth.

And herein lies the problem: you just said that it is good to prompt people to spend their money, because if they don't, it is like sand through your fingers. Then, you point out that if they are REALLY GOOD at doing so, and their expenditures take the form of wealth-producing activity, that we should merely tax it at increasing rates to compensate for the gap between rich and poor.

Slavery. You just condoned slavery. Because the FED gets a slice regardless. They are the winner regardless. So that poor sap that has done well in the past BETTER KEEP FOCKING DOING WELL, because ONE SLIP UP and he loses.

Your entire focking system is a giant HAMSTER WHEEL powering the rich slobs who control our currency, and you're busy schilling for that nasty corrupt enslaving system, and you're lauding growth.

The growth is artificial, and unsustainable. The chart you lauded earlier defines a parabola. Ever try to fly a plane in that pattern? Know what happens? It stalls, and then crashes.

Your system creates parabolic (read: exponential) "growth", but what it is really creating is parabolic debt, meaning: IOUs drawn on the souls of individuals...debt that can never be repaid in a lifetime.

Nonsense. It happens regardless of the system, but that wasn't the point I've been making. What I've said is that the severity of how it happens is MANY TIMES GREATER in this BS fiat system with which you're obsessed. You're a full-blown Keynesian, and that's precisely the nonsense that is in the process of destroying us.

You're completely oblivious to the points being made to you, and you continue to blindly defend the notion that it is a good thing to FORCE people to move their wealth. That's complete nonsense, and creates the stratification of wealth that is a core complaint of so many.

They're busy blaming the rich, but they should be blaming you.

It doesn't create demand; demand is found within human nature. What it does is put unsustainable pressure on demand, as crack does the heart.

You know dămned well what I'm speaking of, and your coy nonsense about IOUs passed from a printing press to the distributor of these notes in order to allow me to build something with them is noted.

If the system wasn't broken, the bank would be a financial entity whose power is strictly determined by the number of clients comfortable putting their money in their vaults, to be loaned out to others as they judged prudent.

And then yes, the banks would be loaning me the money of others. Only it would have been backed by the work of others, and not someone pushing a button and creating a ton of pretty pictures on cloth with numbers of various denominations, simply so they can take a portion of my hard work for themselves.

How smug, and indicative of just how wrong you are about just about everything:

<evidence removed - point made>

 

<evidence removed - point made>
You know any poor people who own things like these?

 

Inflation is also a huge tax on people with NO money.

Not understanding that - and the massive disadvantage to which it puts lower classes is the core reason why you're losing this debate.

 

If they have, it's because they've used the police powers of the state to insulate themselves from competition.

But the FIAT monetary system is obviously the easiest one for them to to manipulate as the entire system is nothing more than a state monopoly on the issuance of currency. When the state has a monopoly on something, it will be the elites who benefit the most from it. Conversely, a system that is based upon markets and competition will be less easy for them to control. It's basic economics.

The reason you cannot comperehend it is because I never said such a thing. Stop attributing arguments to people that they did not make and you won't have to be so confused in the future.

It means you have a history of trolling and dishonesty.

I would attribute most of our economic success to free enterprise. It's been the common variable throughout our nation's history and it's the fundamental principle underlying capitalism.

All the technological advances that we've enjoyed since the industrial revolution didn't come about because of our monetary system, they came about because individuals were relatively free to engage in commercial activities without an authoritarian government messing things up.

Yes, competing currencies, which is not the same thing as a gold standard.

 

.....

 

Ethereal: can you take down those pics now? I was just trying to make a point, and not advertise anything to all sorts...TIA

 

Certainly, sir.

Nice Range, by the way - white is the best color.

 

We are comparing productivity generated from the different currency systems. What are you talking about?

Can you please prove that? Because I feel the monetary system has a lot to do with our ability to maximize our productivity. And our evolution in our monetary system is what lead to such massive growth. So unless you can prove all of modern economics wrong, than I suggest you just accept that fact that monetary systems do matter.

Lol, we had slaves, rode horses, and died from measles. There was nothing robust about our 1800s economy until the late 1800s which lead to all the dramatic economic changes in the 1900s.

Those that aren't as gifted to make money under our current system would not be any more gifted under a commodity backed system. The same laws of supply and demand apply under the gold standard.

How is that a problem?

They work at maintaining our monetary system. They are employees. Aren't you a capitalist?

The poor struggle regardless of what system. I don't get what you are referring to when you imply that life was any better before our current system, because facts and data do not side with you on this.

What is artificial about all this stuff that you and I have that someone had to build? Are you telling me my house is artificial or this computer or my phone? Please explain what you mean by artificial.

Debt that never needs to be repaid in a lifetime. Our economic system is based off debt, it doesn't mean we have to pay it back. We already pay back a third of the national debt every year. There is no reason to tax more money out of the system and drain the private sector.

The rich are just much richer than they were before. The poor and middle class are also much richer than they were before. I don't deny that the income gap is a problem. But that is a fiscal policy problem, not a monetary policy problem.

Blaming me for what?

You fail econ 101. Demand in econ 101 is something you want and can afford. I want a Ferrari but I can't afford it. Because of this I am not included in the demand for Ferrari's. Now if I got the amount of money necessary to purchase one, than now all of a sudden I'm part of the Ferrari demand. So yes, money has a huge influence on demand. To say otherwise is ludicrous.

What does it matter about what you did in the past?

Awesome, you are rich and don't understand how money works! I however, and all the rich people I know understand that you don't put your money in a checking account and just let inflation rot you to death.

 

Thanks! Custom Overfinch: did it myself!