The Creation of the Federal Reserve System (Part 4)

You've set up a strawman argument. I never said that money "only" profits commercial banks.

So you're saying that it's not wrong for businessmen to hijack our government and use it as a tool to bail themselves out when their reckless business practices get them into financial trouble....simply because it's legal and socially acceptable?

I strongly disagree with your opinion. There is nothing moral about the simple democratic majority voting for the business man to use the state as a tool to put a gun to the head of the poor to force them to pay for the failures of the businessman.

 

That is false.

productivity does not directly affect the money supply.

higher productivity does not make new money magically appear.

its very simple:

all money is created from debt.

money = principle

debt has interest.

every unit of money has a relative bond with interest attached.

the interest exceeds available currency and the principle amount at money creation.


dont get me started on GDP either. its completely cooked up with hedonics and substitutions and a horrible, useless measure of productivity.

broken window fallacy and all too.

 

LOL!! Who cares if the interest exceeds available currency and principle. This ridiculous theory of yours only matters if the debt matures at the exact same time.

 

It is not.

I never said it did.

So what? It's not as if all the interest gets paid off all at once. There is enough money for all the interest to be paid as it comes due. If we tried to pay it off all at once it would be a problem. The only way that's going to happen is if the dollar hyperinflates, which would be an effective default because the holders of securities would be paid with worthless notes.

I agree that the broken window fallacy applies to government spending artificially stimulating the economy. But that has no bearing in the accuracy or inaccuracy of GDP measurement. It's just a statistic, we know what it measures. It's how you interpret the statistic that matters.

 

Interest compounds exponentially and gradually increases its ratio to available money over time.

we are reaching a point on the exopnential curve where debt spending is going to double numerically dramatically in a short time. or default.


default or exponential inflation

rock or hard place.

 

People create things that may have value; creating forms of wealth can be considered a natural right.

From my perspective, why do you believe the State should have any power to deny and disparage persons from creating forms of wealth, and how would it be accomplished in any republican form of government, without a different social contract that no longer affords those natural rights? The market for derivatives is one example.

 

You are just making stuff up...

We all know what you are talking about. It is called the "Mathematical Flaw of Interest". The theory that debt has to be compounded in order to pay off interest because there isn't enough money to pay off principle + interest. But the only way that theory works is if all the debt matures at the exact same time. Otherwise it does not work mathematically.

 

If it does not only profit Commercial banks, why do you have any issues regarding the private sector having a private profit motive?

Your argument is your red herring; you are welcome to explain why America would have the unique problem of being able to pay people a decent wage and provide them with decent benefits, and not expect them to do a good job. In my opinion, that simply begs the question of, what is wrong with the subjective value generation system of our current regime?

Why do you believe that persons who were not in official poverty and could afford to hire entire departments to help them conform to rational choice theory; needed corporate welfare instead of doing more justice to their wage ratios?

In my opinion, we merely need simpler public policy choices.

 

Please be specific. What things people create that may have value? I don't think a blank piece of paper with your signature on it would carry any exchange value.

You have demonstrated very limit understanding about money & banking, now you're showing an absolute zero knowledge about derivatives trading. Derivative is not a form of money, it's a contract, and it will be honored with "money", you're so confusing between contract and money. You do not settle a contract with a contract with a contract. Dude, do you understand what are you talking about or you're simply talking out of your ass?

And I notice you haven't answered my simple question. Here it is again for the 4th time.....

Why do you think allowing everyone to create their own money is a better solution? Do you have any idea how that might affect US & global economy?

 

I don't have a problem with the private sector having a profit motive. You're still confused about the difference between a corporatist market and a free market. This does not surprise me because it is common for educational institutions, the government, and the media to blur the distinction.

My argument is not a red herring, you're just strawmanning the hell out of me. I honestly have no idea what you're rambling about right now, or what relevence it has to the points I made.

I don't believe in corporate welfare. I'm arguing AGAINST corporate welfare. If you took the time to read what I was saying instead of rambling on about nothing, you would have grasped that.

Our two choices right now are pretty simple - the Republicans and Democrats. The main reason it's an easy choice is because they're almost exactly the same party, so it's not really a choice at all.

 

I tried specific before, but you only responded with fallacies. So, here is a more general version which you know you cannot rebut adequately. People create things that may have value; creating forms of wealth can be considered a natural right. A formerly blank piece of paper with my signature and valid terms and conditions for negotiation with any creditor that may honor that formerly blank piece of paper may carrie some exchange value with that medium.

The market for derivatives is the prime example I am referring to; corporate paper is another market that can create "money out of thin air".

I thought my response covered it adequately, but you were too busy resorting to fallacy to notice. Here it is again for your conveneience.

People create things that may have value; creating forms of wealth can be considered a natural right in our republican form of government.

A letter of credit is one form of money that can be created out thin air with a pen and a blank piece of paper. I am assuming good business practice except in special cases for illustration.

Why do you believe there should be any denial and disparagement of a natural right under normal and usual business practices found in Commerce?

 

If you don't have a problem with the private sector making profit or having a private profit motive; why do you even need to distinguish between a private corporatist market and a private free market?

I am not familiar with all the terms you present. You are welcome to define them for me in our arguments as we go along. Any links to standardized definitions are helpful.

From my perspective, simply recognizing the need for a profit motive under any form of Capitalism should be enough to not have a problem with that form of Capitalism.

My point about corporate welfare was that if was that simple, why would they need corporate welfare instead of just doing their jobs.

In my opinion, we simply need a more well informed electorate.

 

You have not given any specific, as your post just prove it. You're babbling about some moral and natural right and even you can't explain what it is. In fact, all you're spewing are fallacies that no one understand what are you're talking about.

Why do you think you have the right to create your own money? What make you think everyone should accept that silly idea?

Derivative is NOT money, it's a contract. I can simply assume you're talking out of your ass again.

Oh really? You thought? You're spewing your baseless nonsense yet I;m resorting to fallacies.

A piece of paper with your signature on it does not have any value. You can't create wealth by forcing everyone to accept your stupid piece of paper. Simply as that.

Again, a letter of credit is NOT money. We've been over this already. Now you're just trolling.

Strawman is walking.

I do not believe government should deny private sector to create wealth.

And I do not believe your silly idea that allowing everyone to create their own money is a better solution to our current currency.

And yet you haven't answered my question, here it is again for 5th time...

Why do you think allowing everyone to create their own money is a better solution? Do you have any idea how that might affect US and global economy?

 

I tried specific before, but you only responded with fallacies. So, here is a more general version which you know you cannot rebut adequately. People create things that may have value; creating forms of wealth can be considered a natural right. Why do you believe the concept of natural rights is a silly idea?

 

A derivative can be a form of money; I did not say it was legal tender for all debts public and private. That is your special pleading, and not mine.

 

Forcing anyone to accept anything is no longer a form of Capitalism, but a form of Socialism; so, in that sense, you are resorting to a strawman that you can conveniently refute, since you have no point or rational argument to use for a valid rebuttal to a rational argument.

Sometimes, all a formerly blank piece of paper needs, is a signature and payment instructions to provide that value via that medium.

 

A letter of credit is a form of money, I am not claiming it is legal tender for debts public and private; that is your strawman argument.

 

I am not sure why preventing the private sector from creating forms of wealth should be considered an option under any form of Capitalism.

In any case, abolishing the market for derivatives or corporate paper may be more harmful than being inconvenienced by "too much liberty".

 

How do you define "natural rights"? Whose rights? Your fallacies are exposed and you're stuck a in corner. If you do not spew your nonsense, you would not end up babbling and swinging to defend your silly idea.

 

A derivative is a contract, it's NOT a money. You either do not understand it or you're simply lying.

 

Another spin, another fail. I'm not forcing anyone to do anything. And I never state that current currency system are flawless. There are a lot of issues need to be address, nevertheless, US dollar is universal accepted as medium of exchange.

You're the one who tries to force everyone to accept your silly idea of allowing everyone to create their own money is a superior solution.

Oh btw, since when a socialist like you against socialism? LMAO!! You can't make this (*)(*)(*)(*) up.

 

A letter of credit is NOT a form of money. We've been over it. Give it a rest troll.

 

More deflection danieltroll? It's not what I asked, here it is again for the 6th time....

Why do you think allowing everyone to create their own money is a better solution to current system? Do you have any idea how that might affect US and global economy?

 

A natural right to create forms of wealth. It is a line of reasoning we have been discussing for some time; why claim it is all of a sudden, something new in our argument?

 

And a piece of paper with your signature on is NOT wealth. Period.