Nature for example. A drought can reduce crop yields resulting in a price increase to maintain profitability based on demand exceeding supply. Government regulations can add to costs resulting in price increases as long as demand exists, like Obama claiming he would make it unprofitable for coal production of electricity. Please note that I'm not arguing against your posts.
yes but this has nothing to do with inflation since a reduced crop yield does not increase or decrease the money supply. Only an increase in the money supply can increase the general price level.
I agree, and made an attempt in my post #50 to show the true cause of inflation and wealth disparity that is created by fiat currencies which are backed by yet to be performed labour. MB 1918-01-01 $4,874,000,000 MB 1929-10-01 $6,122,000,000 MB 1939-12-01 $14,523,000,000 MB 1949-12-01 $33,324,000,000 MB 1959-12-01 $40,087,000,000 MB 1969-12-01 $63.,244,000,000 MB 1979-12-01 $133,816,000,000 MB 1989-12-01 $281,878,000,000 MB 1999-12-01 $636,875,000,000 MB 2008/09/10 $874,822,000,000 MB 2009-12-01 $2,045,510,000,000 MB 2016-03-01 $3,910,702,000,000 MB 2016/04/27 $3,895,073,000,000 Too many words are redefined with broader meanings today in an attempt to promote an agenda which makes precise conversation more difficult. The only thing I disagreed with was your statement of "If they double the money supply tomorrow prices double tomorrow, if they cut money supply in half tomorrow prices are cut in half tomorrow." While I do agree that doubling the money supply will eventually result in higher prices, higher wage demands, the appearance of GDP growth, increased tax revenues, and perhaps even a decrease in the debt as a percentage of the GDP, it also results in greater disparity between the richest and the poorest. Only government can create inflation and use the consequences to promote dividing the governed against one another looking for government to solve the problem which it has created and has itself become dependent upon not being solved.
How is money printed in the USA? The mint? No. US Treasury? God no. It's manufactured at a secure facility owned by about 12 of the largest banks in the world. Private banks. They call themselves The Federal Reserve, and in the late 1900s early 1910s, while congress was on recess for Christmas and Winter Break, a handful of congressmen who deliberately did not recess congress prior to congress going home for the winter, got together and passed a primarily abstained "Federal Reserve Act" which would create a cartel who would have absolute control over monetary policy in the USA and the soul right to print dollar-valued certificates (aka Federal Reserve Notes) in the United States for use as currency. (Funny, did they amend the Coinage Act first? I believe it was illegal for a private entity to devalue dollars. I don't think you can pass amendments that contradict other amendment unless you repeal contradicting amendments first, requiring what is it... 2/3 vote by the house and senate?) Anyhow... Andrew Jackson would be furious. "I am one of those who do not believe that a national debt is a national blessing, but rather a curse to a republic; inasmuch as it is calculated to raise around the administration a moneyed aristocracy dangerous to the liberties of the country." -- Andrew Jackson When does the Federal Reserve Cartel print money? Answer: When it runs out, and the governments or corporate entities need to borrow. The Fed will then print what is needed, then loan it to the entity (with interest). This process started slowly in the 40s to supplement the lack of bond purchases by US citizens and foreign investors and the need to fund a war. Back then, however, politicians were still primarily conservative-thinkers and felt it was a death sentence to go into massive debt. Then the 50s hit. The war was over, and the US was the last country with sufficient infrastructure to manufacture and supply Europe and Asia. There was little demand for printing money; the primary exchange of big business was the exchange of debt shares of foreign debtors. The money supply was adequate, and there was enough work and supply to go around. When the Korean War hit, excess wealth started to deteriorate, and tax revenue was sufficient. Then the 60s hit. The USA started running out excess wealth and in came moderate tax hikes and binge-borrowing. In the 60s, the USA funded a 200 Billion dollar space program (adjusted for inflation) which doesn't seem like much, but as a percentage of GDP that's 1.17 Trillion Dollars. The Vietnam added to that debt, as did the defense budget dedicated to the improvement of nuclear weapons and delivery systems, and the induction of modern marvels such as fighter jets and attack helicopters into all branches of the military (due to the success of these tools during the Korean War). It also costs a lot to pay soldiers, and just as much to care for them when they're injured in action. The US Government was now officially indentured to the Federal Reserve Bank. How do you pay off debt? You cause more inflation to increase tax revenue, or raise taxes. Legislation was passed that allowed the Federal Reserve more freedom to control economic policy. Executive Order 11111 was abolished. Then the 70s hit. A period of poverty struck America as demand on entitlements increased as a result of the war and huge influx of children into the population (baby boomer going full bore). Enter the war on poverty. The government begins implementing massive subsidies, enacts additional entitlement programs, and reduces restrictions on existing ones. Trade with Japan, China, and Germany increase exponentially. The OPEC era hits, prices go up on gas and oil. Manufacturing costs rise. Once again, the US steps in and fixes it with subsidies, bombs, and deals. How did the US Government pay for all this? Borrowed more from the Fed, but here's the turning point. The Government was now borrowing also from China, Japan, and other countries. By the 80s, America was still earning more in tax revenue than it required in debt payments, but it was now dependent on continued borrowing to continue funding for entitlements and its massive defense budget. With the shuttle program, and the defense budget at its peak, the tax surplus era would soon be over. The Fed, in an effort to combat inflation (which was out of control) and belay the oncoming recession, raised interest rates to over 15%. Reagan's trickle-down economics (reaganomics) kicked in, tax breaks were given to the wealthy, and increased on middle class workers. It's at this point the US borrowed so much, it would become incumbent on the next generations to pay the bill. Thomas Jefferson would be so ANGRY! "It is incumbent on every generation to pay its own debts as it goes. A principle which if acted on would save one-half the wars of the world." By the end of the 90s, America's idea of a "balanced" budget shifted from this idea that you bring in as much revenue through taxes as you spend in the budget to this notion that if you bring in as much in revenue as necessary to pay your debt, you're balanced. In other words, you're balanced as long as you're not using one credit card to pay another... it's ok to max out your credit cards though. Enter NAFTA and the Pacific Free Trade Agreement. Good bye industry. Good bye manufacturing. The USA would now become a service-based economy borrowing more and raising debt ceilings and borrowing more and moreto prop itself up. Wages drop as a result of steadily rising unemployment rates, the number of persons who earn less than the per capita GDP would nearly double, the middle class begins its long slow deterioration. Then 9/11 happens. The speed increases. 50 years ago your wife didn't have to work, and sufficient income would be earned typically to support a house payment and car payment as well as food and groceries with a moderately skilled position. 40 years ago your wife had to take on a job to supplement lifestyles, and it'd now take a year's household wages for the typical middle class worker to buy a house. 30 years ago, it became 2 1/2 times. 20 years ago, it became 3 times. Today (skipping the bubble / collapse), the typical house would run a middle class working family nearly 4 times their gross wages. Not only that, but their wages are taxes 10% more. Not only that, but tuition and medical has skyrocketed. Must be great to be a Tier 1 recipient of public retirement benefits, pension plans, and everything else. If you're 50-60, must be great to have your house nearly paid off, and your RV in the parking lot. Must be great to have paid $15 - $20 per credit hour for a class in economics. Must be great knowing Social Security, that thing you put 5% into average your whole life will pay your utilities and buy your food. If you're 20-45, sorry, you don't get much of a private retirement... silver egg's not a gold egg, but it's better than no egg right? Enjoy the $400/mo retirement subsidy. You wont own a house, you'll rent, so sorry.. no RV for you. You can't pay the bill. They sell cheap tents at Wal Mart though... Have fun paying your student loans. Hey though... if you consolidate to a 20 year repayment plan you'll do fine. Have fun paying 7-8% social security tax, good luck seeing it. It'll cover your rent though... look at the bright side. Don't forget to carry medical insurance at a young age. The Tier 1 public retirees, homeowners, etc up top need you on the plan to mitigate the costs of being old... it's way to expensive when the plans consist of 40+ only. Don't do it for them, do it for the mom's and dad's who's life circumstances put them in the same boat as you, you'll be fine.
Yeah, several: 1) Inflation didn't exist until the Federal Reserve Act was [fraudulently] passed except in cases of natural scarcity, or gold-rush periods, both of which only affected isolated regions and not the entire country. 2) Today's generation is paying yesterday's debts 3) Despite the fact that the bulk of the elderly population have their homes paid off (something few from the modern generation will enjoy), and receive lavish retirement plans paid for by debt incumbent upon the current generation of workers, who earn less; the elderly complain because of the high cost of healthcare, and the solution is to force younger persons with fewer health issues into the contribution pool. 5) The IRS is a public-administered debt collector for a private cartel, this is not the ideals of a republic nor a democracy. Thomas Jefferson, Andrew Jackson, and the rest of the Federalists were right. Not only did the Central Bank destroy the economy of the free people, but it invited Tyranny and Repression with it. "It is incumbent on every generation to pay its own debts as it goes. A principle which if acted on would save one-half the wars of the world." I welcome war on US soil, and with it the refresh of the tree of liberty with the blood of tyrants. It'll end in one of two ways: the distribution of wealth and property, or the re-establishment of principles that made this country great. "As long as our government is administered for the good of the people, and is regulated by their will; as long as it secures to us the rights of persons and of property, liberty of conscience and of the press, it will be worth defending." -- Andrew Jackson "Labor is prior to, and independent of, capital. Capital is only the fruit of labor, and could never have existed, if labor had not first existed. Labor is the superior of capital, and deserves much the higher consideration. Capital has its rights, which are as worthy of protection as any other rights." -- Abraham Lincoln Do you believe that the sacrifice of the futurity of this nation will lead to peace and contentment, or unrest and uprisings? Do you believe that the expansion of oligarchical interests and banks will create nationalists, or patriots?
PS - The Fed will argue it was legitimately passed by a legitimate number of votes from a legitimate number of representatives, and the bill was an act of congress, and it blah blah blah is great blah blah and we should love it because blah blah blah. For the adults: https://www.youtube.com/watch?v=vB5LK-jihgk For the kids: https://www.youtube.com/watch?v=tGk5ioEXlIM
Who creates our money? And I view the Fed as an arm of our government. I believe we both agree that monetary inflation results in all prices eventually rising as a result, do we not? But we also have price inflation which can occur without need of monetary inflation. Perhaps the best example of that would be health care, which becomes more costly as a result of new an costly technology and procedures. But then we have government/government agency created regulations which can add additional costs.
Obama policies sure has had the Federal Reserve working three shifts, 24/7 printing up trillions of greenbacks for the past 7 1/2 years just to prop up Obama's economy and Wall Street with nothing backing up all of that money. I wonder how long they can keep the printing press printing ? I bet until December 31, 2016.
You brought up some excellent points, especially #1 and #2. Curious, but was there an item #4 or did you accidentally skip it?
that's just not true, inflation is as old as money is and the federal reserve act was passed legitimately
There was a 4th topic, having to do with the establishment of socio-communist principles which will further burden the new generations. I couldn't find the right words so I deleted it, but since you asked, here you go: Scenario: Let's say for a minute Person A is a government worker with public employee retirement. He's about 53 years old, and he's held this job for 35 years. He is on Tier 1 public retirement, and does not pay anything to contribute to (nor ever did) his retirement. He will receive 80% of the average of his last 3 year's wages for retirement, starting at age 59 1/2. He also purchased a home in 1984 for $31,000. He sold this home in 1999 after paying it off (15 year) for $165,000 and bought a new home for $225,000 in a better part of town. He started his career earning $21,000 / yr. He currently earns $68,000 / yr due to his yearly COLA and Step increases. Now let's look at a 25 year old young adult just starting the same public career. He has been working in this position for 5 years now, and is now vested in his retirement. He is on the same public retirement plan, but Tier 3, created in 2004 to solve the issue of public agencies paying for retirement plans. When he retires, instead of 80% he will earn 40% of the average of his last 3 years retirement once he reaches age 62. That same job starts at $34,000 a year today, he earns $36,500 due to COLA and step increases for 5 years. The same house (by age, location, and design) will cost him $215,000 ($31,000 in 1984), and he is not eligible for a loan that high due to debt-to-income ratio. When and if he does get a loan, it will be on a 30-Year fixed. Not only that, but he is paying 7% more in taxes than his 1984 counterpart did (accounting for income, social security, state, medicaid, etc). He is contributing $100 month to his retirement account, something his Tier 1 counterpart did not have to do. He is also contributing twice as much to his medical benefits, more than twice (per ratio) what Person A had to. The reason public agencies do not have the ability to pay for retirement (and the same can be said for private, and other agencies as well), is because of the amount of revenue available for the workforce. In the case of public, revenue is not available because of the amount of debt carried by the government. In the case of private, it's because they must lower labor standards to compete with global markets, and also may carry debt, used to expand investment interests and subsidize the slow growth in stock value as a result of reduced private investment in such things. At the end of the day, the cause of this gap and loss in quality of life is directly related to debt, globalization, and inflation. The worker that started 5 years ago is paying for that debt in the form of higher taxes (over the course of his life), reduced benefits. and various other fees and burdens directly or indirectly related to the failure of the economy. He is responsible for the debts of the prior generations. The prior generations sacrificed futurity for the subsidization of prosperity, his future. He will retire with 1/2 the retirement, his social security benefits (if they still exist) will have less dollar value than the first person's, he will likely be nowhere near paying off his house if he is even ever given the opportunity to buy a house, but wait... Person A is complaining because in planning for his retirement, he'll have to pay $800/mo for medical coverage. Person A is advised by press and social consultation that the cause of this high price is that the younger persons who have fewer medical issues, or fail to see the benefit of carrying insurance, are unwilling to carry medical insurance to offset the burden with a larger pool. In comes the requirement to carry medical insurance. As if the burden on the young were not heavy enough, they're now required to participate in social programs. Look at the numbers yourself: How many persons earned less than the yearly per capita GDP in 1970. Compare that to 1980. Compare that to 1990, and so on. The middle class is dwindling. I'm a patient man. I'm a docile, passive man. But I am getting very angry. I am getting more and more angry watching prices go up to unfathomable levels on Zillow while looking at professional careers listed on Indeed, Craigslist, and other entities offer less and less (adjusting for inflation). I walked by my neighbor's house, a 63 year old retired court clerk, and his $370,000 house and $129,000 RV, and Ford F-350 sitting in his driveway and the Yamaha 250 dirt bike he just bought for his grand kid's graduation present, and I can't help but have covetous feelings about the whole situation... and I am a somewhat spiritual person and understand that covetance is a sin, but it's not his stuff I'm "wanting", nor him (personally) that I blame. I trace-route the issue back to the source, and where I am angry is in the legislators of the 60s, 70s, 80s, and 90s. Where I am angry is at the Federal Reserve Bank. When I heard my grandfather say, "What has this world come to", so many times, and him being a consitutionalist / federalist (having great respect for Thomas Jefferson, Andrew Jackson, Abraham Lincoln, and many other federalists (see signatures on the declaration of independence)), I had always thought it was really my generation that was causing all of today's problems. It's not. It was yesterdays generations who chose to fore-go the prophecies, and wisdom of our fore-fathers, establish a central bank, allow the government to go into debt beyond its means, and sacrifice futurity in favor of the subsidization of yesterday's prosperity. I am angry. Others will become angry when they connect the dots as well. If today's generation is getting angry, tomorrows will be furious. There will come a point.
As I mentioned, historic inflation was the result of natural scarcity (bad season for crops, freezes killing livestock, famines) and gold rushes. You'll notice you graph to the left of the Federal Reserve Act has a lot of green. This only serves my point. One of the founding principles (even acknowledged on the Federal Reserve's website) is that it was created to create monetary "stability". Stable what? Stable losses in fiat value? What I see pre-1930 is an economy that creates jobs, supply, and demand based on markets, adjustments for those markets as jobs, supply, and demands shift, then corrections. This is a stable free-enterprise capitalist society.
No. The Federal Reserve Bank is private. Fact: It is not part of the government, however, it is the Government's chief financier, and as such, has unfathomable influence over legislators at every level. Fact: The Fed appoints its own board of directors, who appoints its own executive director. These are bankers. Fact: If you ask any employee at any of the Federal Reserve Bank branches if they receive public employee retirement benefits, are public employees, or are bound by federal employee rights and guidelines, the answer is no. 12 Private Banks total. It is neither Federal, nor a Reserve, and has more in common with a cartel than a bank. It is a government-sanctioned cartel. Conceptually: how it works: Government legislators wants to borrow $500 Billion to stimulate the economy. Government agrees to pay it off at 26 Billion / Yr for 25 Years at 4% interest (sometimes the government borrows at 15, 20, or even 30 year, thus passing the debt on to future generations) Federal reserve checks its vaults, but they're empty. (hence, it's not a reserve) Federal reserve fires up the printing presses, prints out $500 Billion. (some in fiat, some digitally, some as promissory notes) Federal reserve drops off $500 Billion at the treasury. Government raises income taxes by 1% Government gets to spend spend spend. The Government and the Fed repeat this process every few months. The Federal Reserve takes the money it receives from the IRS and treasury (the payments), and utilizes this wealth for its investments. (hence, the IRS is actually a debt collector for Government, collecting debt for private banks) How the people suffer as a result: US Owes the Fed about 12 to 15 Trillion, and about 5 to 8 trillion to other domestic and primarily foreign-held bonds. About 8 to 12% income tax revenue is required to make these payments. When the government spends the money, the money is introduced into the economy. The value of the dollar decreases. If you do not get a raise at work to counter-act this debt immediately, you just got a pay cut. Then real sickness of the process: The 12 largest banks in the world receive trillions, and all they had to do to get it was press print. Because of fractional reserve banking, the $500 Billion they receive for the next 25 years for that loan we mentioned will actually introduce $4.5 Trillion into the economy. It's the people that foot the bill, it's today's generation who will benefit, it's tomorrow's generation who will pay for it.
we all have computers, smart phones, and flat screens so things are very very good indeed. We are making lots of progress. Theres no monetary problem at all, its libsocialism thats keeps growth at 1-2%.
if you can't see the difference between the time after the mid-20th century and the time before then you don't know what you're looking at, what do you think the green represents? that's not a fact, the federal reserve doesn't finance government, that's forbidden the federal reserve system was created by congress and is controlled by the public, federal reserve board congress is the federal reserve's boss, here's where it tells the fed what it's job is: Federal Reserve Act Section 2A. Monetary policy objectives The Board of Governors of the Federal Reserve System and the Federal Open Market Committee shall maintain long run growth of the monetary and credit aggregates commensurate with the economy's long run potential to increase production, so as to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates. here's where congress makes the fed report its progress to them: Section 2B. Appearances Before and Reports to the Congress (a) Appearances Before The Congress. 1. In General. The Chairman of the Board shall appear before the Congress at semi-annual hearings, as specified in paragraph (2), regarding: A. the efforts, activities, objectives and plans of the Board and the Federal Open Market Committee with respect to the conduct of monetary policy; and B. economic developments and prospects for the future described in the report required in subsection (b). 2. Schedule. The Chairman of the Board shall appear: A. before the Committee on Banking and Financial Services of the House of Representatives on or about February 20 of even numbered calendar years and on or about July 20 of odd numbered calendar years; B. before the Committee on Banking, Housing, and Urban Affairs of the Senate on or about July 20 of even numbered calendar years and on or about February 20 of odd numbered calendar years; and C. before either Committee referred to in subparagraph (A) or (B), upon request, following the scheduled appearance of the Chairman before the other Committee under subparagraph (A) or (B). (b) Congressional Report. The Board shall, concurrent with each semi-annual hearing required by this section, submit a written report to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Banking and Financial Services of the House of Representatives, containing a discussion of the conduct of monetary policy and economic developments and prospects for the future, taking into account past and prospective developments in employment, unemployment, production,investment, real income, productivity, exchange rates, international trade and payments, and prices. (c) Public Access To Information. The Board shall place on its home Internet website, a link entitled 'Audit', which shall link to a webpage that shall serve as a repository of information made available to the public for a reasonable period of time, not less than 6 months following the date of release of the relevant information, including: 1. the reports prepared by the Comptroller General under section 714 of title 31, United States Code; 2. the annual financial statements prepared by an independent auditor for the Board in accordance with section 11B; 3.the reports to the Committee on Banking, Housing, and Urban Affairs of the Senate required under section 13(3) (relating to emergency lending authority); and 4. such other information as the Board reasonably believes is necessary or helpful to the public in understanding the accounting, financial reporting, and internal controls of the Board and the Federal reserve banks. https://www.federalreserve.gov/aboutthefed/fract.htm
I think what Nemiahsis was trying to point out was that until after the Fed was created our money remained relatively constant in value from the time our nation was founded resulting from periods of offsetting deflation. A dollar earned in 1774 had relatively the same purchasing power in 1900, but since creation of the Fed along with government actions we have seen offsetting deflationary periods gradually eliminated resulting in endless growing inflation. Beginning in 1913 our currency has halved in value after 32 years, again after 26 years, again after 9 years, and again after 17 years. While the rate at which it is devaluing has been slowed it will continue to devalue. Perhaps at some point in the future hyper-inflation will be allowed to present itself collapsing our form of government and allowing those who possess real wealth to create a new government with much greater control over those who are governed, in their best interests of course.
inflation is a monetary phenomenon, without money it's just abundance or scarcity the graph shows that money's value fluctuated wildly in the 18th and 19th century look around, the country is much richer than it was in 1913 the fed's target inflation rate is 2%, that benefits most people what would happen if the dollar continually gained in value?
It does, but with periods of inflation offset by periods of deflation resulting in a relatively constant value of the dollar. Yet far more indebted. Are you saying most people are in debt? Who ever suggested our currency should gain in value?
Monetary Inflation is a monetary phenomenon, as are Wage Inflation, Interest Inflation and Cost-push Inflation. Demand-pull Inflation exists whether money exists or not. The only way to resolve Demand-pull Inflation is to increase Supply or decrease Demand.
