Why do people think countries need centrally planned money?

When output doesn't meet monetary growth you will experience high inflation.

Argue it all you want, but that is just your subjective opinion based on zero empirical facts. The chart I showed is factual data.

 

ok fine, what does velocity of money have to do with why you think one quantity of money is preferable to another.

how do you know when you've achieved it? how do you know it's preferable to any other form of growth?

 

Yep, they can, but they're not better at it than the free market. Proven by the state of the economy over the last few years.

That is zero proof that central economic planning was responsible.

I said the rate of growth is negatively impacted by central economic planning. Using real GDP per capita to prove your point is misleading and inaccurate. Government spending is not real economic growth. In order for your claims to mean anything, you have to subtract out government spending.

Let's look at some data here. First, we see real private GDP per capita from 1929-1971, when the dollar was not fiat:

1929:
Nominal Annual GDP: 103.6 billion
Govt Spending: $9.4 billion
Nominal Private Annual GDP: $94.2 billion
Private GDP per Capita: $773.61/person (1929 dollars)

1971:
Nominal Annual GDP: $1126.8 billion
Govt Spending: $246.4 billion
Nominal Private Annual GDP: 880.4
Private GDP per Capita: $4239.61/person (1971 dollars)
= $1790.06/person (1929 dollars)

Avg % Increase/year (1929-1971) = 3.13%


And now, we see real private GDP per capita from the time period of when the dollar was completely fiat:

2010:
Nominal Annual GDP: $14,526.5 billion
Govt Spending: $3,002.8 billion
Nominal Private Annual GDP: $11523.7 billion
Private GDP per Capita $37324.26/person (2010 dollars)
= $6,932.31/person (1971 dollars)

Avg % Increase/year (1971-2010) = 1.63%

Source:
http://bea.gov/national/nipaweb/SelectTable.asp?Selected=N
Table 1.15

Average rate of private economic growth per person is about half of what it was before we were a fiat currency. Data not on your side.

 

We may not need centrally planned money, but currently, it seems to be the best opportunity cost; since, most economies that are not developed enough to have a centrally planned economy seem to have lower standards of living in modern times.

Why has no truer An-Cap simply created more wealth than our printing press at our official mint?

 

Money Supply = QTY * Velocity

In this equation the money supply is the amount of money actually used in transactions in the economy.

Say in Year 1- You make $100, you give me $100 and I go and give that $100 to someone else. That is 3.0 velocity and $300 of transactions.

In Year 2- You make $100 and you save $100. That is 1.0 velocity and $100 in transactions. So the Govt says, we need to improve the economy. So they give me $100

In Year 3- You make $100 and you save $100. I make $100 and give $100 to someone else. That is 1.5 velocity and $300 of transactions.

Now in year 1 there was only $100, in year 3 there was $200, yet the same amount of transactions occurred.

You base it off of productivity. If you feel that economic growth is determined by the amount of output generated in the economy, then you achieve for more output that you consider sustainable in the long run.

 

Well facts are not on your side. The dollar was fiat between 1934-1971.

 

wow. so how does that help you figure out that one stock of money is preferable to another?

so its about feelings and considering? its what you feel that you consider is sustainable? that's soft language. I thought you were mathematically inclined.

 

I already put up the link which proves that the US was continually growing the economy while simultaneously improving the standard of living without the FED.

The difference is that the US had debt of 10% of GDP prior to the FED. Now we have debt that is approaching 100% of GDP.

Your burden of proof is to explain how enduring the FED, while accomplishing the same thing that we did before - but without the debt - is better.

 

Completely false. Learn the difference between fractional reserve currency and fiat currency.

 

hasn't the dollar always been a fiat currency?

 

No. It was a fractional reserve currency up until 1971 when the Bretton Woods Agreement collapsed.

 

fiat just means by decree.

 

Explain to me what you mean by stock of money. Are you talking about quantity or the USD vs gold in general.

It depends on your countries objectives. There is no perfect answer to what is sustainable growth. We make sustainable growth out to be 2-3% growth per year. That is what our economists have come up with as to what they deem is sustainable.

 

Lol, you have a lot to learn. 1971 broke the tie to foreign exchange in gold. We have been running this same very system since 1934 with very minor differences in how we record transactions between banks and the Treasury.

 

The Fed has nothing to do with debt to gdp ratios. That is purely Government.

 

Waaa????

Since we have to pay interest on our debt....who do we pay the interest to again????

Secondly, that wasn't even the most important point of my link: it definitively proves that GDP grows just fine without the FED.

Your position has been soundly defeated multiple times; only you refuse to see that.

 

How else can corporate America and government team up to steal trillions of dollars from us?

Next question?

 

Whomever owns the debt that matures

That is not proof. There is absolutely nothing comparable economically speaking between the 1800s and the 1900s. The fact you are trying to compare the two is laughable!!

 

Stock, amount, quantity. Take your pick.


So basically sustainable growth has no real meaning.

 

Lol. That just makes the question more significant. Why does such a system have such widespread popular support?

 

Waaa??????

The fact that GDP grew at nearly the same rate in the 1800's without the FED and massive Government expenditure as it has with the FED and massive Government expenditure (creating a FALSE IMPRESSION of GDP growth), IS ALL THAT ANYONE NEEDS TO SEE.

You've created quite the impossible circumstance, haven't you, akphidelt? You complain that you deal in only math, and when I disprove your case using only math, you complain that there are other factors that make comparisons invalid.

Uh-huh.

 

You are just playing your philosophical bull(*)(*)(*)(*) games again.

I have said that what matters about quantity of money is velocity.

Sustainable growth has no "real meaning" but America has chosen what we deem as appropriate stable growth. There is no inherent meaning to sustainable growth.

You are just playing stupid games again

 

You assert that a specific quantity of money is more desirable than any other quantity. I am asking you to justify that position.

 

Where is your link that has all this data in which they didn't even record during the 1800s?

 

And I keep telling you. Velocity. How many transactions do we need in order to increase economic growth.

I have said this over and over again. There is no magic number that fixes all economies, it is completely based on a progression.