Who else resents USAians for causing this finanical crisis?

[KrazyHorse]

Originally posted by HalfLotus
Demand...right. So there is a 15-30% increase in demand for energy and food over the past couple of years?

You are officially stupid.

It is far more likely that recent inflation is caused by the Fed's enormous increase in the money supply over the last several years. And why they stopped publishing M3 data to conceal that massive increase.

Stupid and insane.

Since the Fed no longer publishes honest money supply data (as if they ever did, considering their CPI numbers don't include food or energy costs, LOL), we rely on private sources which estimate the increase in the money supply in the 10s of trillions of of Dollars.

Stupid, insane and a liar. CPI includes energy and food costs. "Core inflation" does not.

[HalfLotus]

Thank you for correcting my mistake on the CPI vs core inflation designation, however immaturely. My point that the Fed's numbers are dishonest remains unchallenged.

I am genuinely interested in some decent economic discussion, that's why I'm here. I know there are some smart people at 'poly, I've seen them before.

I have plenty to learn, and I have done enough research that I can probably add something to the discussion.

Now is there anyone on this pitiful forum that can discuss things with a more substance than 'you're stupid' or, 'the joo's did it'?

[Impaler[WrG]]

It seems to me to be much easier to have a central authority which is able to control the money supply so as to maintain a stable price level than to trust a static model to give us a stable price level.

Like I said I'm not against Fiat currency in principle, it just looks to me that the current system isn't working very well at matching the money supply to the 'stuff' supply. The central authority of the FED is clearly capable of making grievous errors in monetary policy so perhaps a model based system which takes human ideology and corruption out of the equation will be better. Provided that the model is correct of course

[Kidlicious]

Originally posted by HalfLotus
Demand...right. So there is a 15-30% increase in demand for energy and food over the past couple of years? That is absurb. Please don't tell me this economic discussion is going to devolve into a naive application of supply and demand. You realize that supply and demand has no bearing on the price of crude oil?

You also made a 'mistake' on this.

I don't think you realise that monetary policy maintains employment, which creates demand. So increasing money increases demand. With a gold standard you have higher unemployment so less demand.

Also you don't seem to know how supply and demand affects prices.

[HalfLotus]

Originally posted by Impaler[WrG]


Like I said I'm not against Fiat currency in principle, it just looks to me that the current system isn't working very well at matching the money supply to the 'stuff' supply. The central authority of the FED is clearly capable of making grievous errors in monetary policy so perhaps a model based system which takes human ideology and corruption out of the equation will be better. Provided that the model is correct of course

I agree with this line of thinking, however who can model an entire global economy and society accurately? I don't think anyone can come even close.

And if you put men in charge of this system, what's to prevent them from corrupting and screwing everything up for their own gain? History tells us that any group of men with that much power will be corrupted.

This is why I'm fond of the free market. The arguments of Adam Smith and the Austrians make a lot of sense to me.

[Kidlicious]

Originally posted by HalfLotus
This is why I'm fond of the free market. The arguments of Adam Smith and the Austrians make a lot of sense to me.

Adam Smith never believed all that nonsense that we are arguing with you about.

[KrazyHorse]

Originally posted by Impaler[WrG]


Like I said I'm not against Fiat currency in principle, it just looks to me that the current system isn't working very well at matching the money supply to the 'stuff' supply. The central authority of the FED is clearly capable of making grievous errors in monetary policy so perhaps a model based system which takes human ideology and corruption out of the equation will be better. Provided that the model is correct of course

The last time the fed ****ed up the money supply badly enough to cause high (>5%?) levels of inflation was in the bad old days before Volcker came in and stopped that ****.

Whereas creating a basket of commodities which maintains its value to within a range of 0 to -5% relative to overall CPI over the course of 20 years would be virtually impossible.

But you're welcome to try creating such an instrument. In fact, I bet there's money in it for you if you do.

[KrazyHorse]

Originally posted by Kidicious


You also made a 'mistake' on this.

That is a charitable interpretation.

[KrazyHorse]

I'm interested to know why, if commodity price inflation is mainly due to an increase in the money supply, we have not also seen concommitant inflation in other sectors (namely, the labour market, in which unit labour costs have been remarkably stable). Labour shows nowhere near the same amount of resistance to upward change as it does to downward (there is still some stickiness on the upside, but MUCH less).

[Kidlicious]

I have a friend that I went to college with who believes in the gold standard and such. He was the smartest guy in class. He could hold his own in this discussion to say the least, but you wouldn't get any conspiracy theories.

[HalfLotus]

Originally posted by Kidicious


Adam Smith never believed all that nonsense that we are arguing with you about.

His theory is quite relevant to my position that markets should be FREE from interference from the Federal Reserve.

I'm referring to the 'invisible hand' of free-markets which support the theories of A. Smith and the Austrians.

Modern free-market economics supports a currency backed by 'hard assets' - a combination of commodities and precious metals, so you can get off your 'gold standard' merry-go-round.

[snoopy369]

If Kid and KH agree that you're wrong, you are most definitely wrong ... I don't think they've agreed on anything since ... 2003?

[HalfLotus]

My goodness, more infallible logic and reasoning from staff. Impressive!

[Kidlicious]

Originally posted by HalfLotus
His theory is quite relevant to my position that markets should be FREE from interference from the Federal Reserve.

No. His theory is that government shouldn't impose restrictions on suppliers, that it shouldn't keep prices high, that it shouldn't try to stockpile precious metals. He said nothing about monetary policy.

Also, he was an equilibrium economist. He believed that supply creates its own demand, that cost is objective, not subjective.

I could go on. Why do you think there is such a thing as Austrian School economics?

[Unimatrix11]

Originally posted by HalfLotus
Thank you for correcting my mistake on the CPI vs core inflation designation, however immaturely. My point that the Fed's numbers are dishonest remains unchallenged.

I am genuinely interested in some decent economic discussion, that's why I'm here. I know there are some smart people at 'poly, I've seen them before.

I have plenty to learn, and I have done enough research that I can probably add something to the discussion.

Now is there anyone on this pitiful forum that can discuss things with a more substance than 'you're stupid' or, 'the joo's did it'?

That´s just KrazyHorse´s ´style´, as i learned. He seems to have no issue with assuming people would be free of the ´money illusion´ (meaning they always account for futrue inflation - and that at the correct rate it´s gonna be - like everyone was a sage or something), but OTOH call everyone who disagrees with him stupid. It would be interesting to discuss the inflation rates for the next 10 years with him. He´d probably call everyone who is off his assumption by more than a percent or so stupid, and still assume, people would be ´smart´ enough to assume inflation rates correctly.

EDIT: As i just read, inflation can be caused two-ways basically:

a) demand-pull: Thats basically the way HL sees it: The money supply has been enlarged, thus demand rises -> prices rise - > loans rise = inflation

b) profit/cost - push: This one can stem from anticipation of future inflation for example. Workers do expect prices to rise, thus they demand more income. It is sort of a self-fullfilling proficy. When the income rises, costs rise and, if enterprises calculate their product prices in the manner of ´costs+x´ (where x is the profit), prices will rise, too.

So there´s the basics. Both views are valid. Both are taken from ´introduction in the money theory´ (ottmar issing). I dont think there is any school yet in economics, that could claim to know the truth (or rather: all of it). They all have their flaws. Many theories were obviouly not developed in an open-ended approach, but rather in order to show, why this or that politics would make sense (and why everybody doesnt only have the right, but the duty, to only care for him/herself). It is startling, how little each theory takes from the other, and often established insights (namely those of Marx) are shunned aside, apparently because they do not fit into the picture desired. Many an economics theory is merely an attempt to explain why injustice is just and the best for all. In that modern economics has some ´qualities´ of a preisthood these days. They fanatically believe in their ´school´ and condemn any other as the devil´s work. And they call it a science.

Personally, i find it rediculous to believe, that if everybody acts like an egoistic a**, that the best for all would emerge - no matter how fancy and pseudo-methematical the ´proof´ may be. You know, the times when my uncle could convince me, he had eleven fingers, by counting them (wrongly) in front of my eyes, have long gone...