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  • Re: Supply vs Demand applied to money

    Maybe some context will help. I am currently in an online argument about the broken window fallacy. My opponent argues that the fallacy does not apply if the business owner (whose glass was broken as goes the traditional parable) would not have spent the money on anything. For example, he argued that if the business owner was merely hoarding money,
    Posted to Economics Questions (Forum) by tcostel on Tue, May 29 2012
  • Supply vs Demand applied to money

    I understand the supply side pretty well, but it is the demand side I struggle with. If the supply of money increases, you will get a dollar worth less and thus higher prices, as well as all of the negative effects of inflation (the business cycle, etc). But why would a decrease in the demand for money not cause the same effect? For example, say the
    Posted to Economics Questions (Forum) by tcostel on Tue, May 29 2012
  • Re: Is it possible to measure the demand for money, even approximately?

    @Jack: In general by the amount of money used to buy the specific good. If I exchange $10 for 1 television, then my demand for the television is $10. You could say the sellers demand for the $10 is 1 television. @Anenome: As for exchange rates, I don't see how that can be an accurate measure. Exchange rates can be affected both by the supply and
    Posted to Economics Questions (Forum) by tcostel on Sun, May 27 2012
  • Is it possible to measure the demand for money, even approximately?

    Or even to ordinally measure if demand for money is increasing or decreasing? Prices are effected both by the supply and demand of money. The supply of money can be measured. But how is one to gauge the demand of money? For if the demand for money rises as the supply of money rises, prices would not rise as much had demand remained constant.
    Posted to Economics Questions (Forum) by tcostel on Sun, May 27 2012
  • Re: The Modern Day US Banking System

    Ah perfect. That should more than do it. I just started the Mystery of Banking by Rothbard. I will check out those others as well. Thanks.
    Posted to Economics Questions (Forum) by tcostel on Sun, May 27 2012
  • The Modern Day US Banking System

    I am trying to wrap my head around the current US banking system and it is very difficult. I have read books by Ron Paul, What has government done to our money by Rothbard, Economics in One Lesson by Hazlitt, and various other articles and books. But I cannot seem to find much literature specifically dealing with the current US banking system and how
    Posted to Economics Questions (Forum) by tcostel on Sat, May 26 2012
  • How fractional reserve banks loan money into existence

    I always have a hard time wrapping my head around the idea of money creation through fractional reserve banking. I get the general idea, but I have a hard time re-articulating that idea to other people. I use comparisons to help me understand concepts, so I would like to know if this comparison is basically correct. Say the money used was gold, and
    Posted to Economics Questions (Forum) by tcostel on Mon, Sep 26 2011
  • Demand for money and business cycles

    ABCT holds that business cycles are caused by an increase in the supply of money. I understand the supply part of ABCT pretty well, but I do not understand how demand factors in. For example, wouldn't the decrease in the demand for money also cause business cycles? Why such a decrease not result in economic problems? What about an increase in demand
    Posted to Economics Questions (Forum) by tcostel on Fri, Aug 19 2011
  • Re: Great Depression and monetary policy?

    He also said that falling prices meant that interest rates were too high, and that high interest rates caused the 1920 depression.
    Posted to Economics Questions (Forum) by tcostel on Sun, Aug 7 2011
  • Great Depression and monetary policy?

    Whenever discussing the Great Depression, it is always argued that high interest rates imposed during the Great Depression (Specifically 1931) worsened the Depression because investment was curtailed. This of course seems to run contrary with what an Austrian would argue. There was obviously credit inflation prior to the Great Depression, which I always
    Posted to Economics Questions (Forum) by tcostel on Sun, Aug 7 2011
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