filc:If I loan you 3 sandwhich's today, in return you must pay me 4 sandwhich's next month. Where do my 3 sandwhich's come from? I certainly didn't blink them into existence.
But that not what banks do. Bank create the money they loan you by writing down those numbers in their books. If they loan you three numbers, as soon as time and interest kick in they have a court enforceable contract that you have pay back more than what was created, or you are forced into foreclosure.
Knight_of_BAAWA:Only thing I can gather is that it includes the non-backed greenback fiat currency, the issuance of which and national banking laws during the War To Prevent Southern Independence created massive inflation. However, this has nothing to do with a gold standard.
I do hope you realize that 100% of our money today is 100% backed.
Live_Free_Or_Die: tomozope: Live_Free_Or_Die:I am not in agreement with tom that money creation starts with checkbook money. Before the fed could initially create any checkbook money it had to meet a reserve requirement under the federal reserve act. This is partially true, before the banks can create any checkbook money the banks must meet a reserve requirement? What does that reserve requirement consist of? Another book keeping entry. http://www.theantechamber.net/VkDocuments/DeptOfTreas/DeptOfTreasPage3.html It is true, don't feed me that partially true bs... Section 16. (1913 Federal Reserve Act HR 7837) Every Federal reserve bank shall maintain reserves in gold or lawful money of not less than thirty-five per centum against its deposits and reserves in gold of not less than forty per centum against its Federal reserve notes in actual circulation, and not offset by gold or lawful money deposited with the Federal reserve agent tomozope:But most importanly we don't use the reserves for money, and some local bankers told me that they don't even pay much, if any attention to them anymore. Reserves are mearly a way for central control over the National Banks (federally chartered banks) and not the state chartered banks. State Chartered banks are 100% controlled by the state laws and those vary from state to state. You are incorrect about state banks, they could opt in: Section 8 Any bank incorporated by special law of any State or of the United States or organized under the general laws of any State or of the United States and having an unimpaired capital sufficient to entitle it to become a national banking association under the provisions of the existing laws may. by the vote of the shareholders owning not less than fifty-one per centum of the capital stock of such bank or banking association, with the approval of the Comptroller of the Currency be converted into a national banking association, with any name approved by the Comptroller of the Currency
tomozope: Live_Free_Or_Die:I am not in agreement with tom that money creation starts with checkbook money. Before the fed could initially create any checkbook money it had to meet a reserve requirement under the federal reserve act. This is partially true, before the banks can create any checkbook money the banks must meet a reserve requirement? What does that reserve requirement consist of? Another book keeping entry. http://www.theantechamber.net/VkDocuments/DeptOfTreas/DeptOfTreasPage3.html
Live_Free_Or_Die:I am not in agreement with tom that money creation starts with checkbook money. Before the fed could initially create any checkbook money it had to meet a reserve requirement under the federal reserve act.
This is partially true, before the banks can create any checkbook money the banks must meet a reserve requirement? What does that reserve requirement consist of? Another book keeping entry.
http://www.theantechamber.net/VkDocuments/DeptOfTreas/DeptOfTreasPage3.html
It is true, don't feed me that partially true bs...
Section 16. (1913 Federal Reserve Act HR 7837)
Every Federal reserve bank shall maintain reserves in gold or lawful money of not less than thirty-five per centum against its deposits and reserves in gold of not less than forty per centum against its Federal reserve notes in actual circulation, and not offset by gold or lawful money deposited with the Federal reserve agent
tomozope:But most importanly we don't use the reserves for money, and some local bankers told me that they don't even pay much, if any attention to them anymore. Reserves are mearly a way for central control over the National Banks (federally chartered banks) and not the state chartered banks. State Chartered banks are 100% controlled by the state laws and those vary from state to state.
You are incorrect about state banks, they could opt in:
Section 8
Any bank incorporated by special law of any State or of the United States or organized under the general laws of any State or of the United States and having an unimpaired capital sufficient to entitle it to become a national banking association under the provisions of the existing laws may. by the vote of the shareholders owning not less than fifty-one per centum of the capital stock of such bank or banking association, with the approval of the Comptroller of the Currency be converted into a national banking association, with any name approved by the Comptroller of the Currency
In truth some banks DON'T have to meet any reserve requirement, and in more truth their reserves only consist of more promises to pay (they don't actually have anything in reserve). Most reserves consist of a book keeping entry (numbers).
"Any bank incorporated by special law of any State or of the United States or organized under the general laws of any State or of the United States and having an unimpaired capital sufficient to entitle it to become a national banking association under the provisions of the existing laws may. by the vote of the shareholders owning not less than fifty-one per centum of the capital stock of such bank or banking association, with the approval of the Comptroller of the Currency be converted into a national banking association, with any name approved by the Comptroller of the Currency"
I'm glad you looked up how a state chartered bank can become a national bank but that has nothing to do with what our conversation was about.
The fact is that the Federal Reserve Banks do not deal in gold anymore. Do you really believe that the banking system hasn't changed its rules to benifit themselves in the 100 years?
Bottom line is, we don't use reserves for money and they aren't part of the circulating medium of exchange.
Live_Free_Or_Die: Government obligation... full faith and credit... what is the difference? Either way the money is based on a government DEBT (and I am still waiting for the detractors to clearly articulate how money does not represent debt). It is peoples perception of government's ability to pay an obligation that gives the federal reserve system value which is measured by treasury securities. The collateral government has is not my private property. That is just pure bs. The collateral government has is the power to tax by all means necessary.
Government obligation... full faith and credit... what is the difference? Either way the money is based on a government DEBT (and I am still waiting for the detractors to clearly articulate how money does not represent debt). It is peoples perception of government's ability to pay an obligation that gives the federal reserve system value which is measured by treasury securities.
The collateral government has is not my private property. That is just pure bs. The collateral government has is the power to tax by all means necessary.
You may not believe that they have put up your property for colleteral but that is what the law states. Also, What do you think the government put up as collateral in order to obtain that Bond? Have you ever "studied" anything besides some theory and maybe the actual facts of what is actually going on?
The collateral that the government has put up is your private property, and this has to change.
Matgre:Mises People: you can't repay the loan with the loan money... which is why you supplement it with other income...
Do you realize that the loan money is the only source of the money? There is no money until someboby borrows it and at that point in time the banks create that money as a book keeping entry and only create the principle. As soon as time and interest kick in the debt grows but the money supply does not making it impossible for everyone to get out of debt.
tomozope:I do hope you realize that 100% of our money today is 100% backed.
tomozope:Do you realize that the loan money is the only source of the money?
Knight_of_BAAWA:Faith isn't a backing.
but your property is.
If that were true then the time and interest would grow our money supply and we would have a money supply of 57 trillion.
Our money only comes into exsistance as an interest bearing loan and once time and interest kick in, the debt grows but the money supply does not.
If you really believe that money is debt, then gold/silver under the 1792 coinage act could not be money because nobody owed on that money.
Credit is what we use for money but it really can't be money. Money is what is used to pay debts, credit is what you owe.
tomozope: Matgre:Mises People: you can't repay the loan with the loan money... which is why you supplement it with other income... Do you realize that the loan money is the only source of the money? There is no money until someboby borrows it and at that point in time the banks create that money as a book keeping entry and only create the principle. As soon as time and interest kick in the debt grows but the money supply does not making it impossible for everyone to get out of debt.
What's up with quotes and wrong authors these days? That wasn't me :o
"A man’s time is always scarce." - Murray N. Rothbard
Never mind Mises money clips! Where are the Mises wheelbarrows?
tomozope:How did all that money get put into circulation?
Irrelevent to the point. But to answer, it's traded into circulation just like anything else. How did iphone's get into circulation?
tomozope:or people would have to go without because there isn't enough money for everyone to purcahse oranges?
No offense but this is really a dumb comment you've provided us. If there is a static quantity of money prices adjust to that supply.
If an orange sellsman cannot sell his oranges because there is "Not enough Money" as you say. Than his oranges are priced too expensive and he will have to lower his price. What he doesn't do is go to a government and ask them to create new money into existence. Thats just stupid talk.
Your statement really proves you know nothing about what your talking about.
tomozope:The author still won't factor in (and always avoids) the cost of doing business. My suspiction is that he/she has never owned or ran any kind of business. The cost of doing business is interest and taxes.
This comment is non-sequitur and also makes a false assumption about my personal life. Since you cannot fathom the fundamentals of economics you resort to attacking my person, ad homonim.
tomozope: The cost of doing business is interest and taxes.
This is just a plain stupid lie. The cost of business is various variables and different for each industry. The cost of doing business's has nothing to do with taxation. On a free market there would be no taxation. It's a whole other topic all together and yet another non-sequitur post by you.
tomozope:How would that money be moved into circulation?
How does food enter circulation? How do ipods, iphones, tires, cars, fuel, any just about anything enter circulation? By trade. Are you really that dumb?
tomozope: now spend brand new money to rebuild our infrastructure with that new steel.
Why does new money need to be spent? the "Author" likes to make up stuff when he writes and just assumes everyone will beleive his lies.
tomozope: Any time in history whenever there is an increase of the money the production has always increased BUT we are doing it all as interest bearing loans now,
This is factually incorrect. Historically incorrect, empirically incorrect, and theoretically incorrect. You might as well be telling me the moon is made of cheese. Stop making stuff up. Your on a forum of generally well read people, we won't believe asinine posts like these. especially by someone who's been refuted like 30 times now.
tomozope:further increasing the cost of doing business (what really destroys the purchasing power of the money).
Your terminology is so lost here. The cost of doing business has nothing to do with monetary theory. I would laugh if it weren't so sad...
tomozope:I don't think I would want to study basic economics because that last time I read one of those books it wasn't until page 200 and something that they said banks create all the money as interest bearing loans.
Which book? I think your lieing to be honest. So you may have read one economics book, and you quiet reading at what page 300? That doesn't change the fact that your still trying to solve calculus without the order of operations. What book did you read so we can scrutinize your selection and matching author. :)
tomozope:If all these businesses are producing so much and being so profitable, why are they collectively getting deeping in debt if they are all making a profit? Both cannot be true, and those economics books simply do not focus on the root cause of america's financial problems.
Austrian economists focus on the root cause. You just refuse to read. And business's create wealth, they don't create money. Business's create new "REAL" wealth. They create steel, they create consumer goods, they create various things. Business's don't create "Money".
tomozope:still have a functioning medium of exchange that is based on the principles of gold/silver except lets use something where there is enough of it.
You don't even know or understand what the principles of gold and silver is. And for the 20th time there has always been enough gold and silver. Your just a folly who can't think for himself.
You have to prove to us that there is not enough gold and silver. Until then stop making the statement that it's true. This is a forum of people who don't live in delusional land as you do. We live in reality and we know the difference between facts and fairy tails, unlike you. From here on out just assume that we are unanimously agreed on this forum that there is enough gold/silver. If you disagree with us thats fine, your error. But repeating yourself over and over and over won't make your fallacies any less fallacious.
You are still trying to solve calculus without the order of operations. You refuse to learn the order of operations and have admitted to it. Therefore no one should take you seriously.
tomozope: The fact is that the Federal Reserve Banks do not deal in gold anymore. Do you really believe that the banking system hasn't changed its rules to benifit themselves in the 100 years? Bottom line is, we don't use reserves for money and they aren't part of the circulating medium of exchange.
A basis for your argument ignores the simplicity of the Federal Reserve system.
The Federal Reserve system started out as a partially backed currency converting a smaller amount of gold into a larger amount of nothing. The system failed when people demanded their gold.
Government then eliminated the requirement for the Federal Reserve system to redeem their payable on demand instruments in gold.
Government later granted the Federal Reserve system a monopoly on legal tender creation.
Government later severed the direct relationship between the currency and gold dissolving Bretton Woods.
The Federal Reserve system is by its nature a fractional reserve banking system that has incrementally become what it is today. Your arguments solely against the creation of credit by the Federal Reserve are not arguments against the Federal Reserve system. They are arguments against government intervention and the lack of competition to the Federal Reserve system.
tomozope: I'm glad you looked up how a state chartered bank can become a national bank but that has nothing to do with what our conversation was about.
Please refer me to a state chartered bank that is not denominated in Federal Reserve notes.
tomozope: You may not believe that they have put up your property for colleteral but that is what the law states. Also, What do you think the government put up as collateral in order to obtain that Bond? Have you ever "studied" anything besides some theory and maybe the actual facts of what is actually going on? The collateral that the government has put up is your private property, and this has to change.
Please cite the law you are referring to that gives your argument substance. Private property is not the collateral. If you stated people are collateral I would not disagree because productivity is taxed.
tomozope:but your property is.
Knight_of_BAAWA: Knight_of_BAAWA:Faith isn't a backing. tomozope:but your property is.Explain, and this had better not be "your property is collateral for the debt", because money is not debt.
How about an explanation other than money != debt, money is not debt, etc.
I explained my position in detail and added a chart. I tire of people just stating money != debt with no explanation.
How exactly do the federal reserve notes in your possession not represent a government obligation?
Live_Free_Or_Die:How exactly do the federal reserve notes in your possession not represent a government obligation?
what are the government obliged to do? make you pancakes?
Where there is no property there is no justice; a proposition as certain as any demonstration in Euclid
Fools! not to see that what they madly desire would be a calamity to them as no hands but their own could bring
nirgrahamUK: Live_Free_Or_Die:How exactly do the federal reserve notes in your possession not represent a government obligation? what are the government obliged to do? make you pancakes?
Steal your pancakes...
Money isn't debt and debt isn't money, in so far as the two terms are defined. Money is the medium of exchange. In our system, it can come into existence when someone goes into debt, but this is not the same thing as saying "money is debt".
And even in our system, one can go into debt without money being created. If I loan $4 to my friend to be paid back in an hour, I haven't actually created money and no money is destroyed upon repayment. So debt doesn't necessarily increase the money supply; and an increase in the money supply doesn't necessaily mean new debt was created. The Treasury could easily print up a bunch of bills if it really wanted to and increase the supply of paper floating around.
David Sherin: Money isn't debt and debt isn't money, in so far as the two terms are defined. Money is the medium of exchange. In our system, it can come into existence when someone goes into debt, but this is not the same thing as saying "money is debt". And even in our system, one can go into debt without money being created. If I loan $4 to my friend to be paid back in an hour, I haven't actually created money and no money is destroyed upon repayment. So debt doesn't necessarily increase the money supply; and an increase in the money supply doesn't necessaily mean new debt was created. The Treasury could easily print up a bunch of bills if it really wanted to and increase the supply of paper floating around.
In our federal reserve system please cite an example of money that comes into existence that does not represent debt.
Live_Free_Or_Die: David Sherin: Money isn't debt and debt isn't money, in so far as the two terms are defined. Money is the medium of exchange. In our system, it can come into existence when someone goes into debt, but this is not the same thing as saying "money is debt". And even in our system, one can go into debt without money being created. If I loan $4 to my friend to be paid back in an hour, I haven't actually created money and no money is destroyed upon repayment. So debt doesn't necessarily increase the money supply; and an increase in the money supply doesn't necessaily mean new debt was created. The Treasury could easily print up a bunch of bills if it really wanted to and increase the supply of paper floating around. In our federal reserve system please cite an example of money that comes into existence that does not represent debt.
I'm not entirely sure if there is any money that doesn't come into existence as debt in our system, but it isn't impossible for money to come into existence without debt. That's all I was trying to get at. I'm not an expert on what exactly our money supply is composed of. It would be very easy for the Treasury to simply print up some bills rather than have the federal reserve buy Treasury bonds with money it creates out of thin air, but as of now, I don't believe this happens (and certainly not on any significant scale).
Either way, it isn't a system that Austrians support.
The point here is that Money crank here, AKA TOm and his friends want to replace the Federal Reserve system with the Congressional Reserve system. Both systems operate identically the same and both will be corrupt.
The other point here is that Tom comes to incorrect conclusions on why we had financial turmoil. Last I checked it was the Austrian's and their theory of the business cycle which predicted this mess. Not Money cranks, and last I checked the only "school of economics" calling themselves "Money as Dept" know next to nothing about economics itself and have no real literature to backup most of their claims.
Also if the treasury prints new money by lending it to banks. I'm talking paper money. And banks come clean on their loans what happens to that paper money? Does it shrink out of existence? Does the fed throw it into a large kiln and burn in? No because money itself is NOT dept and need not come into existence from dept.
Knight_of_BAAWA:Explain, and this had better not be "your property is collateral for the debt", because money is not debt.
Live_Free_Or_Die:How about an explanation other than money != debt, money is not debt, etc.
filc: The point here is that Money crank here, AKA TOm and his friends want to replace the Federal Reserve system with the Congressional Reserve system. Both systems operate identically the same and both will be corrupt. The other point here is that Tom comes to incorrect conclusions on why we had financial turmoil. Last I checked it was the Austrian's and their theory of the business cycle which predicted this mess. Not Money cranks, and last I checked the only "school of economics" calling themselves "Money as Dept" know next to nothing about economics itself and have no real literature to backup most of their claims. Also if the treasury prints new money by lending it to banks. I'm talking paper money. And banks come clean on their loans what happens to that paper money? Does it shrink out of existence? Does the fed throw it into a large kiln and burn in? No because money itself is NOT dept and need not come into existence from dept.
I agree completely. I used to watch all those zeitgeist films, but when i actually started educating myself, I accepted the fact that I knew very little. Reading Rothbard and Hazlitt was probably the best thing I ever did for my understanding of money and basic economic principles. Tomopoze would do himself well to sit down and study some Austrian literature.
lol same here
filc: tomozope:How did all that money get put into circulation? Irrelevent to the point. But to answer, it's traded into circulation just like anything else. How did iphone's get into circulation?
There is NO MONEY traded into circulation today. 100% of it is loaned into circulation. The actual creation of money ALWAYS involves an extention of credit by a private commericial bank. It's also very relavant to the point, because if a person doesn't understand how money is created and put into circulation that how can he understand anything else about it? How can a person ever understand money if they don't even understand the principles under which it functions?
filc: tomozope:or people would have to go without because there isn't enough money for everyone to purcahse oranges? No offense but this is really a dumb comment you've provided us. If there is a static quantity of money prices adjust to that supply.
Right now there is people going without in the "richest country in the world" because of a shortage of money. The author of this statement really needs to think about what he is saying. They clearly are not going without because they have enough or too much money.
filc:If an orange sellsman cannot sell his oranges because there is "Not enough Money" as you say. Than his oranges are priced too expensive and he will have to lower his price. What he doesn't do is go to a government and ask them to create new money into existence. Thats just stupid talk.
What the author also fails to include in the orange growers cost of doing business (interest and taxes). At some point in time the orange grower simply has to charge enough money to pay his interest and taxes. Lets be honest here, how much can businesses keep lowering their prices till they go out of business. Clearly the author has never ran a business. Also the author clearly fails to understand that the govnernment creates no money in our system.
filc:Your statement really proves you know nothing about what your talking about.
Sure. By the authors logic the problem in America is too much money. The also by his logic the solution to our economic mess is to pull all the money out of our wallets and tear it up and destroy it because that is what will fix our economy. If that's the solution lets do it and get on with our lives.
filc: tomozope:The author still won't factor in (and always avoids) the cost of doing business. My suspiction is that he/she has never owned or ran any kind of business. The cost of doing business is interest and taxes. This comment is non-sequitur and also makes a false assumption about my personal life. Since you cannot fathom the fundamentals of economics you resort to attacking my person, ad homonim.
It shows again, and again, and again. How about you try calling some businesses and ask them if their problem is to much money or too much debt and taxes. If you tried telling any business owner his problem is to much money they would laugh at you.
filc: tomozope: The cost of doing business is interest and taxes. This is just a plain stupid lie. The cost of business is various variables and different for each industry. The cost of doing business's has nothing to do with taxation. On a free market there would be no taxation. It's a whole other topic all together and yet another non-sequitur post by you.
The author seems that he just can't deal with the reality of today.
filc: tomozope:How would that money be moved into circulation? How does food enter circulation? How do ipods, iphones, tires, cars, fuel, any just about anything enter circulation? By trade. Are you really that dumb?
Food, Ipods, tires, cars, fuel, all come into exsistance by combining the raw resources of the earth, with mans knowledge and labor. That is how all wealth is created. All of these things do not circulate as money.
Money only comes into exsistance by an extention of credit by a private commercial bank. Money is not traded into circulation, it is only loaned. The FED agrees, the U.S. Congressional research service agrees, and the U.S. Treasury agrees, but none of them agree with you.
filc:Why does new money need to be spent? the "Author" likes to make up stuff when he writes and just assumes everyone will beleive his lies.
Because the country is desperatly short on money because of the laws of compound interest. When all money is loaned into exsistance as an interest bearing loan, as soon as time and interest kick in the debt grows but the money supply does not. Without some money being put into circulation that is debt free the debt has to grow every year until it become so large that society cannot sustain it, and we may be at that point in time right now, if not we are just a few short years away.
filc: tomozope: Any time in history whenever there is an increase of the money the production has always increased BUT we are doing it all as interest bearing loans now, This is factually incorrect. Historically incorrect, empirically incorrect, and theoretically incorrect. You might as well be telling me the moon is made of cheese. Stop making stuff up. Your on a forum of generally well read people, we won't believe asinine posts like these. especially by someone who's been refuted like 30 times now.
I'm sorry but it's true. Whenever there is a lot of new money comming into circulation production has always increased and when the money was taken out of circulation production grinded to a halt. Anyone remember the "great depression" when the banking system dried up the money supply? I'm not telling anyone the moon is made of cheese, what I'm saying is that in order to be prosperous there has to be enough money in the system for people to meet the buying and selling needs.
filc: tomozope:further increasing the cost of doing business (what really destroys the purchasing power of the money). Your terminology is so lost here. The cost of doing business has nothing to do with monetary theory. I would laugh if it weren't so sad...
Again, I'm not talking about theory, I'm talking about the facts about how our current monetary system works. Lets live in reality for a moment.
filc: tomozope:I don't think I would want to study basic economics because that last time I read one of those books it wasn't until page 200 and something that they said banks create all the money as interest bearing loans. Which book? I think your lieing to be honest. So you may have read one economics book, and you quiet reading at what page 300? That doesn't change the fact that your still trying to solve calculus without the order of operations. What book did you read so we can scrutinize your selection and matching author. :)
I didn't quote a book and it's been years. Since when did I put any calculus questions up here? I don't read economics books anymore, I read books about how our monetary system actually works. Most economics books only teach a half truth, and a half truth is the damnest of all lies.
filc: tomozope:If all these businesses are producing so much and being so profitable, why are they collectively getting deeping in debt if they are all making a profit? Both cannot be true, and those economics books simply do not focus on the root cause of america's financial problems. Austrian economists focus on the root cause. You just refuse to read. And business's create wealth, they don't create money. Business's create new "REAL" wealth. They create steel, they create consumer goods, they create various things. Business's don't create "Money".
Banks are private commercial businesses and they DO create money, matter of fact, they are the only ones who do it in our system, and they only create that new money as interest bearing loans.
What is the Austrians opinion of the root cause of America's financial problem? Please tell me.
filc: tomozope:still have a functioning medium of exchange that is based on the principles of gold/silver except lets use something where there is enough of it. You don't even know or understand what the principles of gold and silver is. And for the 20th time there has always been enough gold and silver. Your just a folly who can't think for himself.
I don't hate gold or silver, I've just done the math. There isn't enough of it on the plant to make it work as a general medium of exchange.
The principles of gold and silver was to combine mans labor, with the raw resources of the earth, along with his knowledge (monetization) and create money debt free under the 1792 free coinage act. All that money came into exsistance as an asset to the people instead of a liability. That's the only reason gold/silver worked as money. The only problem with it was there wasn't enough of it to work as a general medium of exchange.
filc:You have to prove to us that there is not enough gold and silver. Until then stop making the statement that it's true. This is a forum of people who don't live in delusional land as you do. We live in reality and we know the difference between facts and fairy tails, unlike you. From here on out just assume that we are unanimously agreed on this forum that there is enough gold/silver. If you disagree with us thats fine, your error. But repeating yourself over and over and over won't make your fallacies any less fallacious
From everything I've read, there has only been 158,000 tons of gold ever mined in the history of the world, and 40 billion ounces of silver ever mined. If you even had all the gold and silver in all the world and put it in Coin form and spent it into circulation in the USA it wouldn't even dent the U.S. Debt. Even if we had no debt, and besides, if people really wanted to use coins, the would just use the ones we have now, or would have used the gold/silver coins back then. People have always preffered the check book money over the coin money. It's easier, safer, and more convienient.
http://www.youtube.com/watch?v=9E0UPBtmTb0
After reading his newest book, I really don't think Byron is a gold hater or gold lover, he's just someone who has actually done the math.
filc:You are still trying to solve calculus without the order of operations.
What are you talking about?
filc:You refuse to learn the order of operations and have admitted to it. Therefore no one should take you seriously.
I'm not here talking about calculus, I'm talking about how our monetary system functions.
Tom you are wrong. We are right.
tomozope:Right now there is people going without in the "richest country in the world" because of a shortage of money. The author of this statement really needs to think about what he is saying. They clearly are not going without because they have enough or too much money.
Zimbabwe
tomozope: What the author also fails to include in the orange growers cost of doing business (interest and taxes). At some point in time the orange grower simply has to charge enough money to pay his interest and taxes. Lets be honest here, how much can businesses keep lowering their prices till they go out of business. Clearly the author has never ran a business. Also the author clearly fails to understand that the govnernment creates no money in our system.
What the author fails to realize is that business's don't establish the price of goods nor do the production costs necessarily establish the price of goods. Consumers themselves establish the price of goods. Econ 101.
P.S.
Tom, I know more about business than you. Your an idiot. It's actually HARD to remain in the state of ignorance your in right now.
filc: What the author fails to realize is that business's don't establish the price of goods nor do the production costs necessarily establish the price of goods. Consumers themselves establish the price of goods. Econ 101. P.S. Tom, I know more about business than you. Your an idiot. It's actually HARD to remain in the state of ignorance your in right now.
Are you trying to tell me that businesses don't have to include the cost of interest and taxes in the prices of their products?
What business do you own?
Last time I went shopping every business I went into had a price marked on all their items. Clearly those businesses established the prices of those goods. The consumers have to pay what the businesses ask or they don't get the products. I never once seen customers walking into the stores setting prices.
What country are you from? Maybe you're not living in America. Do you live in a country where everything is purchased at auction? How does money move into circulation in your country?
filc:Zimbabwe
http://moneyaswealth.blogspot.com/2009/03/answering-propaganda.html
http://moneyaswealth.blogspot.com/2009/01/hyperinflation-zimbabwe-myth-and.html
Enjoy.
I've been following this thread for quite a while. Tomozope, please stop, it's embarrassing. You are obviously entirely unfamiliar with basic Austrian ideas about almost everything you have talked about whether it be the business cycle, what money is, how it comes about, why there is no magic amount needed in any economy, the costs of business, etc. I beg you, read some literature on this site before you make any more posts. Stop assuming you know what money is and take the time to read Rothbard.
filc is right when he is telling you that you are trying to learn calculus before the order of operations. Just because calculus has higher applications and is more advanced doesn't mean you can skip the fundamentals. In physics, you don't start throwing friction and air resistance into the equation until well after you've analyzed a nonexistent and impossible frictionless world that resides in a vacuum. That doesn't mean you are wasting your time by setting up a situation in that world. It is necessary to start basic before you add more complicated concepts and variables.
Maybe you think basic economics is beneath you. Trust me, a lot of professional economists would do well to go back to the basics.
Of course businesses have to include how much debt they owe and their tax obligations in their costs, but you said that the costs of business are "interest and taxes" which is not true. There are far more costs than just these.
You don't have to hold an auction for prices to be set competitively or for consumers to affect the market. Sure the store owner physically sets the price, but he does so in such a way as to maximize profits. If consumers don't buy his product at prevailing prices, he must lower them to sell the presently unsold units. That is how consumers influence the market (one way, that is). To say that consumers have no effect on price is to reject practically all economic thought. It's completely nonsensical.
David Sherin:the costs of business
I said the costs of doing business.
David Sherin:Stop assuming you know what money is and take the time to read Rothbard.
Then can you tell me what money is?
David Sherin:filc is right when he is telling you that you are trying to learn calculus before the order of operations.
But we aren't talking about calculus, and i'm not trying to solve any calculus problems. All we are talking about is what do we actually use for money in America, who manufactures it, and how does it get into circulation, and none of those questions he can answer correctly.
David Sherin:Maybe you think basic economics is beneath you. Trust me, a lot of professional economists would do well to go back to the basics.
And lets get down to the basics. What is the fuel that drives an economy? What fuel do we use to drive our economy? What are the consequences of using that fuel, good and bad?
David Sherin:Of course businesses have to include how much debt they owe and their tax obligations in their costs, but you said that the costs of business are "interest and taxes" which is not true. There are far more costs than just these.
The cost of doing business is interest and taxes. Businesses have other costs, that's true, i won't argue that. If you run a business and have to service a tax and interest load of 20k a month no matter weather you sell any of your products that is your cost of doing business.
David Sherin:You don't have to hold an auction for prices to be set competitively or for consumers to affect the market.
Auctions are the only time prices get driven up by the market, and rarely if ever does anyone purchase anything at auction. When is the last time you went to target or wal mart and bid up the prices? When is the last time you ever seen anyone bid up prices at a store? Last time I checked with any stores out there they are all trying to undercut their competition and still remain profitable. (offer the lowest price possible while still remaining in business).
David Sherin:Sure the store owner physically sets the price, but he does so in such a way as to maximize profits. If consumers don't buy his product at prevailing prices, he must lower them to sell the presently unsold units. That is how consumers influence the market (one way, that is). To say that consumers have no effect on price is to reject practically all economic thought. It's completely nonsensical.
And where are these consumers going to get this money to purchase all these items? Where is that money created?
David Sherin:Reading Rothbard and Hazlitt was probably the best thing I ever did for my understanding of money and basic economic principles. Tomopoze would do himself well to sit down and study some Austrian literature.
If it's so great then you should be able to answer these next three questions flawlessly.
What is it that we use for money in America?
Who manufactures that money?
How is that money put into circulation?
Federal Reserve Notes are issued by the 12 Federal Reserve banks and liabilities of the Federal Reserve Banks, but the U.S. has agreed to make them good (obligation).
The Federal Reserve banks are not required to make good on their liabilities under current U.S. Law. AKA Federal Reserve Notes are not a legal promise to pay because they do not have a promise to pay written on their face. Good luck getting any court in the land to do anything about it though. But that really isn't where the problem lies.
The obligation of the government was to make federal reserve notes as good as gold dollar for dollar because they are backed by the full faith (exactly as it sounds) and credit (backed by all the property of the USA) of the United States government but as a mortgage to the banking system who didn't have anything to begin with.
Knight_of_BAAWA: Knight_of_BAAWA:Faith isn't a backing. tomozope:but your property is. Knight_of_BAAWA:Explain, and this had better not be "your property is collateral for the debt", because money is not debt. Live_Free_Or_Die:How about an explanation other than money != debt, money is not debt, etc.Fallacy of shifting the burden of proof. And please note that I AM NOT TALKING ABOUT FRNs. I am talking about money qua money.
Citing my quote in a chain of events related to Tom:
Fallacy: confusing cause and effect.
I do not know Tom and the only question I posed was how money qua the current federal reserve system that has been discussed in this entire thread does not represent debt.
I AM NOT TALKING ABOUT FRNs
Fallacy: red herring
The entire thread has been a discussion of private credit and frn's.
David Sherin:The point here is that Money crank here, AKA TOm and his friends want to replace the Federal Reserve system with the Congressional Reserve system.
Please stop with the lies. I've never said anything like that.
I'll say it again.
I want debt free, wealth money spent into circulation so that the interest can be paid, allowing the people to get out of debt and still have a functioning medium of exchange.
David Sherin:The other point here is that Tom comes to incorrect conclusions on why we had financial turmoil. Last I checked it was the Austrian's and their theory of the business cycle which predicted this mess. Not Money cranks, and last I checked the only "school of economics" calling themselves "Money as Dept" know next to nothing about economics itself and have no real literature to backup most of their claims.
I've got more literature to back up what I say that your theory. Wouldn't matter what the facts are, it looks like you're only interested in theory.
David Sherin: Also if the treasury prints new money by lending it to banks. I'm talking paper money. And banks come clean on their loans what happens to that paper money? Does it shrink out of existence? Does the fed throw it into a large kiln and burn in? No because money itself is NOT dept and need not come into existence from dept.
The treasury does not print new money and lend it to banks. The bereau of engraving and printing prints those federal reserve notes and sells them to the federal reserve banks for the cost of printing. Those federal reserve notes are not money though until they have been monetized by the banking Fed. Those notes are monetized when a banks purchase those notes at face value and sell them to you at face value by having you draw down on your checking account. FRN's are only an evidence of the debt and do not bear interest, but the debt they represent does.
Banks to come clean on their loans? This is impossible because once time and interest kick in the debt grows (principle plus interest) but the money supply does not (principle). Currently America has a money supply of around 7.7 trillion and a total debt of 57 trillion. One thing you must understand is that then the principle is paid back, the money is destroyed. It's clearly impossible to pay a 57 trillion dollar debt with only 7.7 trillion.
FRN's are not the true money in America and they have a life cycle which varies on the value of the note (100's last longer than 20's because they are circulated less). When notes are worn out they are destroyed, or notes are returned to the federal reserve banks when banks want to reduce their reserves.
David Sherin:I agree completely. I used to watch all those zeitgeist films, but when i actually started educating myself, I accepted the fact that I knew very little. Reading Rothbard and Hazlitt was probably the best thing I ever did for my understanding of money and basic economic principles. Tomopoze would do himself well to sit down and study some Austrian literatur
I'll say it again, I've never watched these zeiteist films nor do I care to.
Live_Free_Or_Die:money qua the current federal reserve system that has been discussed in this entire thread does not represent debt.
Our money is not being the federal reserve system. Our money is bank credit.
FRN's (as with any monetary note) are an evidence of debt (credit).
The author clearly cannot accept the fact that all of the money we use comes into exsistance by an extention of credit by a private commerical bank. The process is so simple that most peoples minds simply cannot handle it.
Money as being Money is something that is used to pay a debt, and if you really want to get into it, we have no actual money in the system. What we use for money is interst bearing debt created by an extention of credit by the banking system. You cannot pay a debt with a debt and expect to get out of debt. Without some final payment (what money at the very least ought to be) the debt load on america will continue to increase until it becomes unsustainable. At that point in time i cannot tell you what will happen because I cannot predict the future but what i can say is that if we don't impliment some radical change to the very foundation of how our money is put into circulation it's not going to be a pleasurable experience for the many.
tomozope: Federal Reserve Notes are issued by the 12 Federal Reserve banks and liabilities of the Federal Reserve Banks, but the U.S. has agreed to make them good (obligation). The Federal Reserve banks are not required to make good on their liabilities under current U.S. Law. AKA Federal Reserve Notes are not a legal promise to pay because they do not have a promise to pay written on their face. Good luck getting any court in the land to do anything about it though. But that really isn't where the problem lies. The obligation of the government was to make federal reserve notes as good as gold dollar for dollar because they are backed by the full faith (exactly as it sounds) and credit (backed by all the property of the USA) of the United States government but as a mortgage to the banking system who didn't have anything to begin with.
I noticed you did not cite a specific law. Therefore I consider your argument full of poop.
Stealing pancakes is the government obligation. The government does not possess title to all of the property in the U.S.A. It does have the power to tax. Seriously... shift gears. Your argument is dead unless you can produce a law that gives government title to all of the property within the borders of the U.S. Produce some tangible law or sit down and accept taxation is what makes the obligation good.
Answer this Tom. I am going to sell something this weekend. The product costs me $Z.xx. I want to make $Y.xx profit. I want volume so I am going to offer the following methods of consumer acquisition.
They can pay me $Z.xx + $Y.xx in FRN's
They can pay me $Z.xx + $Y.xx + Fee in Private Credit
They can pay me $Z.xx in FRN's + P payments of ($Y.xx with Interest / P)
They can pay me $Z.xx + Fee in Private Credit + P payments of ($Y.xx with interest / P)
If they choose to finance through me for did I create money?
If I created money is it debt based or does the money represent the goods they took possession of?
If I did not create money how do you account for the customer selling or trading the goods they took possession of and still owe me for to acquire something else?
Live_Free_Or_Die:I noticed you did not cite a specific law. Therefore I consider your argument full of poop
http://www.law.cornell.edu/uscode/12/411.html
12 U.S.C. 411
Are you happy now? Do i have to research everything for you?
Live_Free_Or_Die:The government does not possess title to all of the property in the U.S.A. It does have the power to tax. Seriously... shift gears. Your argument is dead unless you can produce a law that gives government title to all of the property within the borders of the U.S. Produce some tangible law or sit down and accept taxation is what makes the obligation good.
But the banking system has a mortgage on all the property of the USA. You do understand that the banking system is not part of the govnerment right?
tomozope: Live_Free_Or_Die:money qua the current federal reserve system that has been discussed in this entire thread does not represent debt. Our money is not being the federal reserve system. Our money is bank credit. FRN's (as with any monetary note) are an evidence of debt (credit). The author clearly cannot accept the fact that all of the money we use comes into exsistance by an extention of credit by a private commerical bank. The process is so simple that most peoples minds simply cannot handle it. Money as being Money is something that is used to pay a debt, and if you really want to get into it, we have no actual money in the system. What we use for money is interst bearing debt created by an extention of credit by the banking system. You cannot pay a debt with a debt and expect to get out of debt. Without some final payment (what money at the very least ought to be) the debt load on america will continue to increase until it becomes unsustainable. At that point in time i cannot tell you what will happen because I cannot predict the future but what i can say is that if we don't impliment some radical change to the very foundation of how our money is put into circulation it's not going to be a pleasurable experience for the many.
You have not accepted the fact in a fractional reserve system all money comes into existence by converting a small amount of something to a larger amount of nothing. Once it is in existence only government intervention can make it a monopoly and eliminate the need for the original something of value.
I have little disagreement with your assessment of the Federal Reserve system 1) you rail against the Federal Reserve system but the railing should be against government, 2) presently government spending is what drives the fed to monetize debt, and 3) real property is not the obligation, the power to tax is.
You appear to be irking some more established forum members by arguing 1) there is not enough gold and silver which just invites criticism because it is a silly argument and 2) some disagreements with the validity of the austrian school of defining money.
Seeing this thread evolve I wish I hadn't even posted in it. If someone would have made a distinction several pages ago when they said money != debt they were not referring to FRN's or credit I would have dropped out of this thread long ago.
Live_Free_Or_Die:Your argument is dead unless you can produce a law
Here is a place to start.
http://www.thecre.com/fedlaw/legal3b/uscode12-412.htm
Live_Free_Or_Die:You have not accepted the fact in a fractional reserve system all money comes into existence by converting a small amount of something to a larger amount of nothing.
And what is this small amount of something you reffer too?
Live_Free_Or_Die:Once it is in existence only government intervention can make it a monopoly and eliminate the need for the original something of value.
Government monopolies can exsist without government help. Government is supposed to break up monopolies.
Live_Free_Or_Die:I have little disagreement with your assessment of the Federal Reserve system 1) you rail against the Federal Reserve system but the railing should be against government,
But I think govenrment does not create any money, and govenrment is the solution, either at the state level or federal. How else are we going to fix this other than to start passing laws to break up these monopolies and also pass laws that put the benifit of the money system back into the peoples control?
Live_Free_Or_Die:2) presently government spending is what drives the fed to monetize debt
Do you realize that the government creates no money and that the Fed is 100% controlled by the private banking system? Any amount of reading will tell you that the fed operates independent of the government.
Live_Free_Or_Die:real property is not the obligation, the power to tax is.
Property is what is of real value in America. Taxes are mearly collected to pay interest to private corporations known as banks because 100% of this money is all owed to private commercial banks who own all the money all the time.
Live_Free_Or_Die:You appear to be irking some more established forum members by arguing 1) there is not enough gold and silver which just invites criticism because it is a silly argument
Do the math, it's really simple.
Live_Free_Or_Die:some disagreements with the validity of the austrian school of defining money.
Please define money for me if it's so clear and simple from what they teach here.
Live_Free_Or_Die:Seeing this thread evolve I wish I hadn't even posted in it.
Then don't post here.