We need to have a real unconstrained fiat monetary system

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Ever wonder why the POTUS too often mentions with certainty that we will go broke if we don't raise taxes on the rich and cut safety net programs?

I'd like to chalk it up to a fundamental misunderstanding of how our monetary system manges the government's money. But something in the pit of my gut tells me that such a bright man may be cynically subversive because he's significantly constrained by his financial supporters. Moreover, being surrounded by economic advisors, some of whom were practically born on the steps of the Federal Reserve, and are loathe to tell him the true extent of his unconstrained policy and progam spending options.

The relatively small number of Progressives who understand how our monetary system manges our money would tell the POTUS about the paradigm shift in monetary policy resulting from Nixon's abandonment of the Bretton Woods Agreement, its gold stand and fixed exchange rate constraints.

If he were to, now, behave as if he truly embraced the axioms of this paradigm shift, there is nothing this nation could not afford; Single Payer Health Care, free universal education K-Post Grad, a national infrasturcture bank, large-scale renewable energy funding, etc.

What Nixon ushered in was a replacement for the gold standard and fixed exchange rates. The world calls it an autonomous/soverign "fiat" currency monetary system. It' built upon the following axioms.

1. Until the government or a central bank issues currency into the economy, there is no currency to tax or to borrow to spend.

2. A nation issuing its own currency cannot be insolvent in its own currency.

3. Because a nation issues its own currency it is not constrained by revenue per se to spend.

4. A nation issuing its own currency is not dependent upon borrowing from citizens, institutions or foreign governments to fund its debt.

5. In a fiat currency mopneytary system tax and interest rate policy serve to manage inflation not to raise revenue.

The POTUS, Congress, MSM, academia, the States, businesses, households and individual, are mostly unaware or ignore these axioms.

Doing so has crippled this nation and will continue to do so.

www.modernmoney.wordpress.com

www.moslereconomics.com

http://tinyurl.com/bngwnwt

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robbrian
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Comments

The only constraint fiat currency has, is that the amount in circulation can't exceed the productive capacity of the nation. Other than that, governments can simply spend money into existence. They don't have to borrow even a penney. into existence.

All money in the U.S/ (other than coins) is brought into existence through borrowing...public and private.

Through fractional reserve banking, banks loan up to ten times their.deposits. Money above their deposits is brought into being with an accounting entry. They simply credit the borrowers account with it.

Banksters loan to government in the same way. They credit the government account with an accounting entry in return for a Treasury Note. They can then use the Treasury Note as a cash asset and loan government ten times more! Great scam..

Banksters can loan money into existence and get paid interest for the privilege of creating money out of nothing.. We have this weird notion that governments have to borrow their own currency into existence. Wacky. They didn't always do that.

Banks are considered insolvent when their loans are more than ten times their assets/deposits.

Retired Monk - "Ideology is a disease"

polycarp2
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Jul. 31, 2007 4:01 pm

Hear Hear . and on that note, the power Federal reserve corp.One major stock holder being Jp morgan holds 700 Trillion in derivatives could easily afford a 16 Trillion dollar Hair Cut.the Debt of USA,one bank.(Industrial military complex Sicko's) They can tighten their belts just like the rest of us,and because this is their illegal mess, all the central bankers should be Sued out of business.Each country should print its own money.the way "We the People" where tricked into believing we do, is sickening!!Jefferson 's quote If the Nation can issue a dollar bond it can issue a dollar bill.
http://rt.com/programs/keiser-report/episode-279-keiser-report/have a Dime rockefeller, hope your shill sees this.

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FractionallyUnnerved
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http://rt.com/programs/keiser-report/episode-279-keiser-report/

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FractionallyUnnerved
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Apr. 12, 2012 4:38 pm
Quote polycarp2:Through fractional reserve banking, banks loan up to ten times their.deposits. Money above their deposits is brought into being with an accounting entry. They simply credit the borrowers account with it.

I think you have a misunderstanding on what fractional reserve means. It means you have to hold a fraction of your deposits in reserve. Currently it is %10, so if a bank has $100,000 in deposits it has $90,000 available to loan out with the $10,000 reserve held to pay out people who pull out their deposits.

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WorkerBee
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Apr. 28, 2012 12:22 pm
Quote WorkerBee:
Quote polycarp2:Through fractional reserve banking, banks loan up to ten times their.deposits. Money above their deposits is brought into being with an accounting entry. They simply credit the borrowers account with it.

I think you have a misunderstanding on what fractional reserve means. It means you have to hold a fraction of your deposits in reserve. Currently it is %10, so if a bank has $100,000 in deposits it has $90,000 available to loan out with the $10,000 reserve held to pay out people who pull out their deposits.

Not even close workerbee. As soon as you deposti 10 G's into the bank they can now loan out 90G's. The 10 G's is the fractual reserve itself. 10G's is a fraction of what they can now loan out. on $100,000 in deposits the bank can loan out about 1 million based on that deposit. The 1 million is "printed into existence" with the stroke of a keyboard key. What a gig?

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Bush_Wacker
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Jun. 25, 2011 7:53 am

That is illogical, not to mention false;

http://en.wikipedia.org/wiki/Fractional_reserve_banking

With intra bank lending the money supply does increase through a chain of loans but no individual bank is loaning out more then 90% of its deposits.

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WorkerBee
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Apr. 28, 2012 12:22 pm

For simplicity, let's assume you are the banks only depositor. You have $100,000 in the bank. They can loan out $90,000 based upon your deposit. . $100,000 is still credited to your account. An additional $90,000 is also now credited to borrowers accounts. An increase of $90,000 in the money supply with a keyboard stroke.

Banks create money out of thin air. Governments, however,have bought into the notion that they can't create their own money without first borrowing the non-existent money from a bank.

You are right. The sytem is so ludicrous as to be unbelieveable.

An animated video on our monetary system that even, my 12 year old niece understood .

http://www.bing.com/videos/search?q=money+as+debt+youtube&mid=65038D82E8ED62D9128165038D82E8ED62D91281&view=detail&FORM=VIRE1

Retired Monk - "Ideology is. disease"

polycarp2
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Jul. 31, 2007 4:01 pm

I've got to call bunk on the fractional reserve money creation myth. It's just not that simple, but don't take my word for it. Try reading the thoughts of a veryl liberal Nobel Prize winning economist, Paul Krugman who published Banking Mysticism and Banking Mysticism, Continued.

Yeah, I know, it's hard to understand and can even seem to support the myth, but....

A few months ago I had a couple of conversations with a real life international banker. I brought up the fractional reserve thing and he seemed utterly baffled with the presumption that banks could lend out sunstantially more than they held in assests and he didn't even seem like he even heard the term, fractional reserve before.....it was then my turn to be utterly baffled.

Here's another idea. Why dont you try going to a bank and ask a real life banker about it? If the money creation myth had credence, then we'd have probably have seen or heard some bankers raising alarms about it. Most bankers work in local banks and are middle class people, not the kleptocreeps at the helms of Skank of America or Shitty Bank. I haven't seen nor herad of any real bankers express any alarm.

Sure, the Fed and other national and international banks can create money out of thin air, but that's a different issue even if they seem all too similar. Einstein said that genius is the ability to simplify the complex, but not to overly simplify it.

The banking myth is probably the real danger that can undermine confidence in the entire system possibly resulting in runs and collapses. Heck, Ron Paul believes that shit and he's pretty much a nut case. Granted, even the craziest and dumbest people cant be wrong 100% of the time, but...

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MEJ
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Jul. 31, 2007 4:01 pm

/frontline/money-power-wall-street/ is worth seeing. I have one of Frank Portnoy's books, and he contributed to this series. Brooksley Born[sic] is in the story. FDIC was supposed to prevent bank runs, though with the repeal of Glass/Steagal the banks are gambling with the insured deposits. One hedge fund denies the customer's withdrawal request, and it's in the contract that you can't always get what you want, you can try...

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douglaslee
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Jul. 31, 2007 4:01 pm

Many of these banks are leveraged 30-1 and 40-1.

That's why Ellen Brown says a 5% loss can easily bankrupt these leveraged banks.

So the holding of 10% in reserve isn't the case.

And once the 90,000 is created from the 100,000 the banks can then loan out 90% of the created 90,000 -

So they create another 81,000 off the 90,000 and on down the line....

Leading to highly and dangerously leveraged banks where a slight loss leads to complete bankruptcy....

Ok NEVER bankruptcy as then the Fed simply steps in and bails out the banks - who in fact OWN the Federal Reserve.

Thom always says that the banking industry (financing) used to be well under 10% of GDP.

Now the banking sector is up to 40% of GDp.

That extra 30% creates no real economic growth so in relity we can knock 25 -30% off our Printed GDP to come up with a true GDP of around 10-11 trillion.

That level of GDp would indicate a Great Depression - banksters and politicians will never admit to it but we can see and feel it on Main Street and the only reason it's not even more obvious is the huge deficits that the government is running.

Deficits and inflation bailing out the banksters who crashed the economy in the 1st place stealing the average Americans wealth.

But they've been practicing on the 3rd world for the last 60+ years perfecting their craft while we Americans profited from it and Said Nothng.

now it's our turn to feel the Shock Doctrine in action.

Doesn't feel so good does it?

Neither political party will help We The People - it's up to Occupy!
Godspeed OWS!

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Scappoose
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MEJ wrote:" If the money creation myth had credence, then we'd have probably have seen or heard some bankers raising alarms about it. Most bankers work in local banks and are middle class people, not the kleptocreeps at the helms of Skank of America or Shitty Bank. I haven't seen nor herad of any real bankers express any alarm."

poly replies: It isn't likely a banker will express alarm at how they make their own money. Attempt to grasp the simplicity of it. when a banker loans $90,000 for every $100,000 on deposit.....

The $100,000 in deposits remains credited to the accounts. An additional $90,000 is credited to new accounts as loans. The money supply has increased $90,000. $100,000 in accounts becomes $190,000 in accounts. $90,000 is created out of thin air.

Problem: Bankers inject the principle of the loan into the money supply. They don't inject the interest into the money supply. Unless new loans are continually made to cover the shortfall, the system melts down. The money supply shrinks....as now. Periodic meltdowns are indemic to the system. Confidence has nothing to do with it..

Our entire money supply (minus coins) is created in this way...through debt.. I take it you didn't watch the easily comprehensible video link I posted.

"It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow" - Henry Ford

Retired Monk - "Ideology is a disease"

polycarp2
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Jul. 31, 2007 4:01 pm
Quote polycarp2:The $100,000 in deposits remains credited to the accounts. An additional $90,000 is credited to new accounts as loans. The money supply has increased $90,000. $100,000 in accounts becomes $190,000 in accounts. $90,000 is created out of thin air.
Not really. If I loaned you $5 by giving you a $5 bill we cannot both go into a store and each of us try to spend that same $5 bill. Its the exact same concept on a larger scale when it comes to banking with the banker acting as a middlman and pocketing the difference in the intrest spread.

This is how banks have always operated, not sure what the outrage is about.

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WorkerBee
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Apr. 28, 2012 12:22 pm

However, banks can loan me $5 and the man whose account they loaned the $5 on still retains his $5. ,

If you loaned me $5,, you'd have to take it out of your pocket. You can't just credit my wallet with $5 like a bank does..

If you could loan me $5 without dipping into your wallet or someone else's account to make the loan, you'd be creating money out of nothing, wouldn't you?

Government doesn't expand the money supply by simply sending everyone a check every couple of months. Every buck printed has a loan behind it or it wouldn't exist. Even government has to borrow money before it can print it.

There is more than a wee bit more money in circulation than there was in 1776. Our system borrows money into existence. Other than coins, It's the only way it comes into being. We do it with fractional reserve banking.

The money supply expands through borrowing. It shrinks if more loans are paid back than are borrowed...as now.

If you'd like to earn a doctorate in economics to understand it, go for it....or watch the animated video. Even my 12 year old niece understood it. http://www.bing.com/videos/search?q=money+as+debt&mid=65038D82E8ED62D9128165038D82E8ED62D91281&view=detail&FORM=VIRE1

How the system developed, how it functions, the consequences.

Retired Monk - "Ideology is a disease"

polycarp2
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Jul. 31, 2007 4:01 pm

We can issue debt free money much like the French Island Nation of Guernsey.

The American Dream Film-Full Length

https://www.youtube.com/watch?v=tGk5ioEXlIM

The Money Masters.

http://video.google.com/videoplay?docid=-515319560256183936&q=The+money+changers&ei=Zd4QSMjvB47YqAKQtJmzBA

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antikakistocrat
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Apr. 18, 2012 3:41 pm

@polly

And if i withdrew my $5 then the bank has $5 less to loan out, or $4.80 less to be precise. Regardless, I do understand the overall point you are trying to make. The only thing I would say is; so what?

This system seems to have served us well. Ever wonder why European nations came to dominate the world?

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WorkerBee
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Apr. 28, 2012 12:22 pm

Ever wonder why the global monetary system has undergone periodic collapses ever since the current monetary system was devised by bankers with the establishment of the Bank of England in 1694? Watch the video, or if you prefer, get a doctorate in economics outside of the Chicago School of Economics theorists..

.Focus on economic history...often no longer taught as a degree requirement..If we don't teach it, we can make the same fun-filled mistakes over, and over, and over. LOL

Retired Monk - "Ideology is a disease"

polycarp2
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Jul. 31, 2007 4:01 pm

That video is why I asked the question. It struck me when it talked about how it helped finance the expeditions to the new world. Logically it also helped facilitate the industrial revolution.

I am not saying that it not without fault, only that it has shown itself to be superior then other alternatives tried. It provides for an elastic money supply while also maintaining checks on the system. When individual banks evaluate a loan they are evaluating the probability of the loan being paid back. In other words judging the soundness of the activity that they are financing.

The alternative you seem to be suggesting is the government filling this role. The problem with that is then you tend to have capital allocated based on the political needs of the politicians, not necessarily the soundness of the expenditure. Also, as history has shown, there is an incentive to boost spending to the point where inflation acts as a major drag on the economy.

Again, I am not saying that the current system is not without its flaw. I am saying that it is better then alternatives, I would use European history as my evidence. After the events described in the video occurred Europe went from lagging well behind other cultures of the time to leading the world in innovation and prosperity.

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Apr. 28, 2012 12:22 pm

You do realize that....................:

One: Banks as generators of the entire money supply (other than coins) are the prime movers of inflation,

Two: The State-owned Bank of N. Dakota isn't operated for political means. It operates as a sound bank financing not only the states needs, but the needs of the businesses of N. Dakota at really low interest rates. It has done that for nearly a century.

Isn't it private banking that brought about the current financial crises?.

Three: Interest payments made on debt in this nation could finance government if government owned all banks. City banks, state banks, a national bank. There would be NO TAXES. Figures jive to do that and at much lower interest rates than are now common..If you prefer taxes and periodic meltdowns...keep 'em.

Four. Banks inject money into the money supply to cover the principal of the loans. There is no injection to cover the interest. There is a shortfall. Unless continual growth of loans keeps pace with interest extractions, the system melts down...as now. This isn't the first time.

Five: The U.S.. is the only nation not required to back its imports with an equal value of exported goods. It simply prints paper. When that changes, the party is over and the nation will be effectively bankrupt . It won't be able to import even an apple until it pays (with goods) what it owes.

.A dual currency, one for domestic use and one for international trade equal to goods produced for export would lessen the blow. It's been done before. Under our current monetary system, it can't be done.

Six: When there is idle productive capacity, governments can simply spend the money into existence to utilize it instead of borrowing it into existence and melting down as Greece, italy, Ireland, Spain and Portugal are doing. Under the current system, they can't. spend money into existence to boost the production of goods/services to pay off their loans.. They have to borrow it into existence. The shutting down of their economies won't enable them to increase their debt They can't pay it back. Meltdown in every sector of their economies is the only option.

The meltdown will expand globally. Now...tell me again how good the privatized monetary system is

The private banking system hasn't backed paper with gold held in private bankster vaults for centuries It's original functioning is no longer relevant.

Retired Monk - "Ideology is a disease"

polycarp2
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Jul. 31, 2007 4:01 pm

Thanks for your input workerbee.

So it seems to me that the banking system itself isn't the cause of the problem, but a symptom. The root of the problem is the excessive accumulation of "wealth" and power. That the the philosophy/ideology of continuous growth....

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MEJ
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Jul. 31, 2007 4:01 pm

Fractional reserve is this process of infinite sums. Start with a deposit of D of which the bank lends out

D*(1-r) and retains D*r

The new money does the same again with the amount D*(1-r)^2 being lent out and D*(1-r)*r being retained, If you sum all these,

D*{{1-r)+(1-r)^2 +(1-r)^3 +…} which is a geometric series and adds to D*1/[1-(1-r)] = D/r. This means if r is 5% the amount lent out will be 100*D/5 or 20*D.

The retained amounts total D*r * {(1-r) +(1-r)^2 + (1-r)^3 +…} = D*r*1/r = D.

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pshakkottai
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Jul. 11, 2011 11:27 am

My take on this money creation by banks.
Govt_ spending = GDP/5, approx = $ 3 Trillion
Private sector money = $ 11 Trillion handled through fractional reserve banking
Nominal interest rate = 6%
Banks earn = $ 11,000 billion*6/100 = $ 660 billion/yr

The new money created disappears after 25 years if it is a home mortgage and sooner for other consumer finances.

For this money the banks pay less than 1/2 % to the federal reserve. Banks make a huge amount of money. It would be possible and necessary to nationalize them all and let that money fund all infrastructure projects. Money is a public resource and is not a "free market" commodity.
As a first step states can own their own banks based on the North Dakota model.

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pshakkottai
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Jul. 11, 2011 11:27 am

uhh, how does the money disappear?...and doesn't the creation of money have to keep up with population growth and the proliferation of products and services?

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MEJ
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Jul. 31, 2007 4:01 pm

Uh....how did trillions disappear in the financial meltdown? Just exactly where have the trillions disappeared to that the Fed has pumped into the financial system with Quantitative Easing? Why is the money supply shrinking?

Money disappears into the same privatized monetary system that creates it.

New money is created by borrowing it into being. No borrowing....no money. That's just how our monetary system works. Borrow it so you can print it.

Throw a trillion bucks at Walmart shoppers, and within a week Walmart will collect it and throw it into financial paper. What they don't keep here, they send to China for trinkets. The Chinese throw it into financial paper....Treasury Bonds and stocks.

Money thrown at Wall Street goes round and round buying and bidding up more paper. It never leaves.

Someone has to borrow more into existence to make up for it or the circulating money supply disappears.

It's a stupid system, but when people can't borrow enough from finance to make up for the money shipped off to finance, the money supply disappears.

Retired Monk - "Ideology is a disease"

polycarp2
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Jul. 31, 2007 4:01 pm

Money is destroyed by taxation. Taxes do not reenter the economy. A diagram that illustrates this is in " The consolidated government – treasury and central bank | Bill Mitchell – billy blog" at

The consolidated government – treasury and central bank | Bill Mitchell – billy blog

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pshakkottai
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Quote polycarp2:Six: When there is idle productive capacity, governments can simply spend the money into existence to utilize it instead of borrowing it into existence and melting down as Greece, italy, Ireland, Spain and Portugal are doing. Under the current system, they can't. spend money into existence to boost the production of goods/services to pay off their loans.. They have to borrow it into existence. The shutting down of their economies won't enable them to increase their debt They can't pay it back. Meltdown in every sector of their economies is the only option.

The meltdown will expand globally. Now...tell me again how good the privatized monetary system is

The private banking system hasn't backed paper with gold held in private bankster vaults for centuries It's original functioning is no longer relevant.

Again, the question is not "Is the current system perfect" the question is if there is a better alternative and given the history of hyperinflation the system you are advocating for does not seem better. The periods of hyperinflation makes our economic situation rosy in comparison.

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WorkerBee
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Apr. 28, 2012 12:22 pm

Many nations in Europe are growing broke because they can not deficit spend unlike sovereign currency creators like USA , UK, Japan etc. The Euro is a flawed monetary union without a political union.

USA is not like Greece and can definitely have large deficits to grow the economy except for the ignorent congress which likes its "debt limit debate" for want of something to do.

Japan has a 230% GDP of national debt and no austerity. They know how MMT works .I refer you to

Koo58.pdf (application/pdf Object)

Misunderstood Deficits | MyFDL at

http://my.firedoglake.com/pshakkottai/2012/04/20/misunderstood-deficits/

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pshakkottai
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Quote pshakkottai:

Money is destroyed by taxation. Taxes do not reenter the economy. A diagram that illustrates this is in " The consolidated government – treasury and central bank | Bill Mitchell – billy blog" at

The consolidated government – treasury and central bank | Bill Mitchell – billy blog

poly replies: Your link indicates our government can issue money at will. It can't. It has to borrow it before it can print it.

WorkerBee wrote:

Again, the question is not "Is the current system perfect" the question is if there is a better alternative and given the history of hyperinflation the system you are advocating for does not seem better. The periods of hyperinflation makes our economic situation rosy in comparison.

poly replies: When it comes to inflation, it doesn't make any difference if money is borrowed into existence or spent into existence. What matters is that the money supply not exceed the production of goods/services.

Americans won the battle for independence ...and lost the Revolutionary War to banksters.

"Colonial Scrip was not backed by gold or silver and therefore the Colonies could control its purchasing power. This was a revolutionary concept in economics, because the conventional European mercantilist system of money required governments to borrow from banks and pay interest for those loans, as gold and silver were the only regarded forms of money. This is known as the debt-based money system, where banknotes are “bills of debt.” Colonial Scrip, however, were “bills of credit” created by the government, based on the credit of that government, and this meant that there was no interest to pay for the introduction of money. This went a considerable way towards defraying the expense of the Colonial governments and in maintaining prosperity. The Governments charged low interest when it loaned out this paper money to its citizens, with land as collateral, and this interest income lowered the tax burden on the people, contributing to prosperity.

"The currency was born when a lack of gold and silver in the Colonies made trade hard to conduct, and a barter system prevailed. One by one, the Colonies began to issue their own paper money to serve as a medium of exchange to make trade vibrant. The Governments could then retire excess notes out of circulation by taxing the people, helping some Colonies generally avoid inflation. Each Colony had its own currency and some were better managed than others. It was banned by English Parliament in the Currency Act after Benjamin Franklin had explained the benefits of this currency to the British Board of Trade. Outlawing the circulating medium caused a depression in the Colonies, and Franklin and many others believed it to be the true cause of the American Revolution.

http://21stcenturycicero.wordpress.com/fraud/colonial-scrip/

Anything can be used as money as long as the money supply doesn't exceed goods/services available to be bought with it. During one of England's most prosperous centuries, they used notched sticks called chits.The chits weren't borrowed from banksters,

Globally, the circulating money supply is shrinking as it's sucked into financier accounts and financial paper. Economies are crashing. The only way to get them going again is by spending money into existence to utilize idle capacity. Governments can't repay additional debt to create money.. The debt-based ,monetary system is imploding.

Retired Monk - "Ideology is a disease"

polycarp2
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Quote polycarp2:poly replies: When it comes to inflation, it doesn't make any difference if money is borrowed into existence or spent into existence. What matters is that the money supply not exceed the production of goods/services.

I understand this, you have repeated it many times now. You keep dancing around the reality that when government directly prints money things quickly get out of control and you have hyperinflation. Shall I list the countries that have experienced this?

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WorkerBee
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Apr. 28, 2012 12:22 pm

And then can you list the countries that have successfully accomplished what you are advocating?

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WorkerBee
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Apr. 28, 2012 12:22 pm

Well, you can go all the way back to the Roman Empire when it simply spent cheap copper coins into existence and became prosperous enough to conquor the known world (followed by a later folly of using gold instead and sucking the abundant coins out of the money supply) Then the circulating money supply wasn't sufficient to maintain economic functioning.. Gold coins were hoarded by the wealthy, gold became scarce, coins were debased in an effort to keep enough in circulation to provide for the buying/selling of goods. The empire collapsed...for lack of circulating money!.

Hitler, mad as he was, had a great economic team. Money was spent into existence equal to German productivity. Germany didn't run into problems until the productivity was useless stuff like tanks and fighters. They have no economic utility within the general economy as Pres. Eisenhower so aptly noted when referencing our own economy.

War production can put people to work, and doesn't produce what people require. Much of the payment for labor has to be sucked into savings through rationing. There aren't consumer goods to spend it on. A result of excessive war production without forced savings that comes from rationing is inflation. That's sort of an American tale now, isn't it?.What used to cost a $1 now costs around $20..

Prior to the mercantile system....money as debt...nations simply spent money into existence. Countries that maintained a balance between the money supply and productivity flourished. Those that didn't....didn't Too much or too little both lead to problems.

When Argentina collapsed in 2001, there was so little official money in circulation, it was difficult to find enough to obtain a haircut. Barter currencies were issued by barter communities to take place of the scarce official currency. Barter currencies reflected that one hour's labor from a barber equaled one hour's labor from a plumber, a farmer, a baker, etc. The currencies were simply created as a representation of labor time productivity. They weren't "borrowed" into existence,from a bankster demanding interest..., demanding a cut for each piece of currency issued..

Retired Monk - "Ideology is a disease" ..

polycarp2
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Jul. 31, 2007 4:01 pm

Interesting that the two you cite as a good example were economies based largely on outright theft.

How many examples of hyperinflation caused by government printing money do you think I could come up with?

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WorkerBee
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Apr. 28, 2012 12:22 pm

Don't you mean how many examples of government's borrowing money so they could print it could you come up with? Whether governments borrow money into existence or spend it into existence doesn't matter. What matters is that the circulating money supply doesn't exceed a nation's productivity..Try to wrap your head around that basic economic principle. It doesn't take a genius to grasp it. An understanding of 3rd grade math ought to do it..

However, if you want to keep trolling away without addressing the points, I'm done here.

Spain once simply spent gold coins into existence. Just too many. Inflation from gold coins became rampant. Too many gold coins...not enough productivity to spend them on. If Spain had borrowed that many gold coins into existence, the problem would have been the same...with interest.

Retired Monk - "Ideology is a disease"..

polycarp2
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Jul. 31, 2007 4:01 pm

I am not disagreeing with the obvious circulation point, only that the Government could do a better job then the current system. Consider it a game of chicken in the fog, its not so easy to determine the actual productive capacity of a country.

Politicians tend to not look beyond the election cycle so tend to push it too much and put things into a vicious cycle of Hyperinflation, as history has shown.

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WorkerBee
Joined:
Apr. 28, 2012 12:22 pm

Zimbabwe for hyperventilators 101 | Bill Mitchell – billy blog

Wir wollen Brot! | Bill Mitchell – billy blog

Printing money does not cause inflation | Bill Mitchell – billy blog

are good references about (hyper)inflation.

pshakkottai's picture
pshakkottai
Joined:
Jul. 11, 2011 11:27 am

Well, Zimbabwe has lots of money...and produces nothing to back it. It reminds me of another country that dismantled its economy and sold it abroad. The only difference is, Zimbabwe's money isn't accepted in payment of goods. Oil isn't sold using its currency as the worldwide basis of exchange. There is nothing to buy with Zimbabwe paper..

Money is just a representation of a claim on real stuff...a loaf of bread or a pair of shoes.

If there is nothing to buy with it, it's worthless.When there is one loaf of bread and lots of billionaires, the billionaire with the most billions gets it.The rush is on to make everyone a trillionaire...so they can outbid the billionaires and get a loaf of bread..

Money isn't wealth. It's just a claim on real wealth. If the real wealth doesn't exist, then money is good for burning to heat a pot of tea..

Retired Monk - "Ideology is a disease"

polycarp2
Joined:
Jul. 31, 2007 4:01 pm

The American Dream Film-Full Length

https://www.youtube.com/watch?v=tGk5ioEXlIM

The Money Masters.

http://video.google.com/videoplay?docid=-515319560256183936&q=The+money+changers&ei=Zd4QSMjvB47YqAKQtJmzBA

antikakistocrat's picture
antikakistocrat
Joined:
Apr. 18, 2012 3:41 pm
Quote antikakistocrat:The American Dream Film-Full Length
https://www.youtube.com/watch?v=tGk5ioEXlIM
The Money Masters.
http://video.google.com/videoplay?docid=-515319560256183936&q=The+money+changers&ei=Zd4QSMjvB47YqAKQtJmzBA

Are you a real person or just a spambot? I don't think I have read one of your posts that were not copy and pasted from or links to a conspiracy site.

WorkerBee's picture
WorkerBee
Joined:
Apr. 28, 2012 12:22 pm

Currently Chatting

First Columbia took on their drug lords, now they're taking on their billionaires...why can't we?

America’s billionaires are driving this nation’s poverty epidemic. But it doesn’t have to be that way.

As we speak, working-class Americans are getting screwed over by policies that favor the wealthy elite, and leave everyone else in the dust. As a result, more and more Americans are living in poverty.

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