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| Fiscal Cliff https://www.worldofkj.com/forum/viewtopic.php?f=48&t=68640 |
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| Author: | Jedi Master Carr [ Wed Dec 12, 2012 3:37 pm ] |
| Post subject: | Fiscal Cliff |
I figured this deserves its own thread. Things are getting tense about it over this very important issue. The main sticking point is taxes and much revenue should be raised. Right now I think they will compromise when they get close to the deadline but it will be a very interesting and scary to see how this goes down to the deadline. |
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| Author: | Proud Ryu [ Wed Dec 12, 2012 4:11 pm ] |
| Post subject: | Re: Fiscal Cliff |
Someday enough people will realize that the Fed and fiat currency is the cause of essentially every single economic problem. Then these will be eliminated once again, as central banks and fiat currency ruin civilizations every single time they are every implemented. |
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| Author: | Jedi Master Carr [ Wed Dec 12, 2012 4:17 pm ] |
| Post subject: | Re: Fiscal Cliff |
Proud Ryu wrote: Someday enough people will realize that the Fed and fiat currency is the cause of essentially every single economic problem. Then these will be eliminated once again, as central banks and fiat currency ruin civilizations every single time they are every implemented. how many civilization have had central Banks? I can't think of a single one until the 1800s. The idea of Banks didn't even exist before the Renaissance. In Ancient world and the Middle Ages, currency was radically different. And what civilization has fallen because they used a central bank? |
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| Author: | Proud Ryu [ Wed Dec 12, 2012 4:26 pm ] |
| Post subject: | Re: Fiscal Cliff |
Jedi Master Carr wrote: Proud Ryu wrote: Someday enough people will realize that the Fed and fiat currency is the cause of essentially every single economic problem. Then these will be eliminated once again, as central banks and fiat currency ruin civilizations every single time they are every implemented. how many civilization have had central Banks? I can't think of a single one until the 1800s. The idea of Banks didn't even exist before the 1600s. In Ancient world and the Middle Ages, currency was radically different. And what civilization has fallen because they used a central bank? I should say it's fiat currency that always ends in ruin - you are guaranteed to approach a fuedal society, or a plutocracy. Central banks can do nothing but ruin economies over time as well, but they are more modern like you say. The first 3 in the US fail because it was clear that they were going to ruin the economy. The Fed and its network of central banks have survived only because they work slowly enough for people not to notice the ruin of their society until something drastic happens - the fiscal cliff may not quite do it, but it may be another nail in the coffin of the Fed. QE3 was another nail and the collapse of the US dollar may be the last nail. |
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| Author: | Jedi Master Carr [ Wed Dec 12, 2012 4:39 pm ] |
| Post subject: | Re: Fiscal Cliff |
I disagree with you about that. I don't see many civilizations that fell because of a central currency. The Roman Empire had a central currency and that wasn't the reason it fell. It fell because its armies got weak and they unstable leadership for over a century that led to the empire to split. Not sure how a central currency led to feudalism. Feudalism occurred because of the fall of Rome and you had chaos in the middle ages that led to weaker kingdoms and a dominant nobility. We have had a central currency in the most countries for over a century and I don't think that is the problem. The reason we are in debt in the U.S. is because of three sectors of the government: Medicare, Medicaid, and defense. We wasted billions on two wars and Medicaid and Medicare need to be reformed. |
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| Author: | Proud Ryu [ Wed Dec 12, 2012 5:32 pm ] |
| Post subject: | Re: Fiscal Cliff |
Fiat currency really can do nothing but concentrate wealth in the hands of those who create it and set laws about its use, i.e. bankers and governments. It can also do nothing but devalue the currency into oblivion, as it has the US dollar for 100 years. With all the tech advancements we've had, the world would be a utopia today without that devaluation. I don't think that is hyperbole. Instead it is just steadily improving, despite unethical banking (that should be illegal). Check out what happened with the Continental dollar in the US for a key example. Britain's fiat currency also was the main catalyst for the Revolutionary War. What govt. spends money on is really secondary to how they get their money in the first place. It is loaned into existence. Then can't pay it back - and if they could they still wouldn't because it reduces the money supply and you get politically undesirable recessions. The taxpayer gets to pay an enormous amount of interest on that national debt. We work months of each year just to pay interest on the national debt to the megabankers who create the money, which in turn continually devalues the currency. It's a nightmarish mess. Whatever problems a society has, there's always corrupt leadership and economics behind it. |
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| Author: | Darth Indiana Bond [ Wed Dec 12, 2012 7:50 pm ] |
| Post subject: | Re: Fiscal Cliff |
Wait a minute, didn't the end of the National Bank under Andrew Jackson lead to an economic crisis? |
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| Author: | Mannyisthebest [ Thu Dec 13, 2012 10:24 am ] |
| Post subject: | Re: Fiscal Cliff |
I thought the main reason why the Roman Empire collapsed because the empire was always driven by growth through conquest. When they stopped invading other countries they started the long trend downwards. Add in economic, social and political issues and the were ill prepared for the "barbarian: invasions. |
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| Author: | Caius [ Thu Dec 13, 2012 11:05 am ] |
| Post subject: | Re: Fiscal Cliff |
I think going over the fiscal cliff is probably more responsible than any compromise that we will get. At least there will be both some cuts and some tax increases, increases that will be fairer than anything a compromise will result in. |
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| Author: | Proud Ryu [ Thu Dec 13, 2012 11:48 am ] |
| Post subject: | Re: Fiscal Cliff |
Darth Indiana Bond wrote: Wait a minute, didn't the end of the National Bank under Andrew Jackson lead to an economic crisis? The thing about endless money printing, as by central banks, is that all you get is inflation. The more the inflation, the bigger the depression that eventually ensues. This is what happened when Jackson ended the bank. All the fake money (fiat, not backed by intrinsic value) disappeared from the economy. That doesn't mean that inflation was ever good to begin with though - of course it isn't, because it is the devaluation of currency. Had it not been for all that inflation, there would never have been a depression. Once the economy recovered, it was as good as it had ever been, or better. Recession is the only cure for inflation, and inflation, specifically the permanent kind we're used to, is only possible by fiat currency. |
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| Author: | Jedi Master Carr [ Thu Dec 13, 2012 3:22 pm ] |
| Post subject: | Re: Fiscal Cliff |
[quote="Proud Ryu"] Check out what happened with the Continental dollar in the US for a key example. Britain's fiat currency also was the main catalyst for the Revolutionary War. quote] Being a historian on the Revolutionary war I have to point this is wrong. First the currency had nothing to do with the American Revolution. Britain put themselves into debt because of the Seven Years War which was costly and then needed to tax the American Colonies. The decision to tax led to revolt and the British government overreacted by sending British troops leading to the Boston Massacre, destruction of Tea, and Lexington and Concord. Still, the revolution was more complicated than that as many colonists wanted to leave for other reasons, specifically the Proclamation Line of 1763 which prevented colonists from settling in western lands. That decision angered many in Virginia like Washington and Jefferson which is why they supported the revolution. |
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| Author: | Proud Ryu [ Thu Dec 13, 2012 4:49 pm ] |
| Post subject: | Re: Fiscal Cliff |
Jedi Master Carr wrote: Proud Ryu wrote: Check out what happened with the Continental dollar in the US for a key example. Britain's fiat currency also was the main catalyst for the Revolutionary War. quote] Being a historian on the Revolutionary war I have to point this is wrong. First the currency had nothing to do with the American Revolution. Britain put themselves into debt because of the Seven Years War which was costly and then needed to tax the American Colonies. The decision to tax led to revolt and the British government overreacted by sending British troops leading to the Boston Massacre, destruction of Tea, and Lexington and Concord. Still, the revolution was more complicated than that as many colonists wanted to leave for other reasons, specifically the Proclamation Line of 1763 which prevented colonists from settling in western lands. That decision angered many in Virginia like Washington and Jefferson which is why they supported the revolution. I don't doubt your history but unfortunately one must read history from many sets of books to get the full story. I'm not saying you haven't or that I have, but the financial aspect of history seems particularly well-hidden or at least little-known and that's the side I've been most interested in. You could argue that mainstream writers of history often don't understand the financial aspect, or even that the financial powers act to prevent such history from being written into the school books. In any case, it's wrong to say that British fiat currency had nothing to do with the revolution - it had a great deal. The colonies were doing ok using their own colonial currency, and ailing Britain issued a law requiring the colonists to use only Britain's currency, rendering an enormous amount of money unusable legally. From this viewpoint, actual taxation was nothing compared to the raw inability to pay it with what should have been legitimate money. |
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| Author: | Tyler [ Fri Dec 14, 2012 10:15 am ] |
| Post subject: | Re: Fiscal Cliff |
Going to a gold standard would be murder today. Can you imagine the deflation? Where would we get the gold? |
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| Author: | Tyler [ Fri Dec 14, 2012 10:17 am ] |
| Post subject: | Re: Fiscal Cliff |
I also don't see the correlation between wealth concentration and central banking. There really isn't one. |
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| Author: | Bradley Witherberry [ Fri Dec 14, 2012 12:09 pm ] |
| Post subject: | Re: Fiscal Cliff |
Fear breeds passivity. |
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| Author: | Proud Ryu [ Fri Dec 14, 2012 12:16 pm ] |
| Post subject: | Re: Fiscal Cliff |
Tyler wrote: Going to a gold standard would be murder today. Can you imagine the deflation? Where would we get the gold? Deflation is ultimately the only path to an optimal economy - it is the only cure for inflation. You have to understand that our dollar is close to worthless compared to what it was before central banking. This is not what you want. There will be deflation anyway once the dollar bubble pops. Where you get the gold is not a concern. The whole idea of Economics is based on finite resources. Still, there's plenty of gold yet to be mined in the planet and if demand is there then mining enterprises will flourish. Regardless, in an optimal economy, prices decline over time. There is enough gold (and silver) alone in the world to cover monetary needs forever. And you can always change the standard size of a gold coin that buys x dollars if need be. The reason they dropped the gold standard is that the amount of fiat currency they were creating (and planning to create) exceeded the ability of gold to back it up. Money based only on debt and government decree is doomed to fail. Tyler wrote: I also don't see the correlation between wealth concentration and central banking. There really isn't one. There is, it's just hard to see. The central bankers create their currency for the government and the banks and the special interests. So these powers get to use it for spending, speculation, and loans before the inflation shows up in the increased prices of general goods and services (the early spending is what accomplishes that). The common worker is the last to potentially benefit from any of this new money, and as it trickles down over time, it devalues. The vast majority of people will be hurt by the new money, rather than helped (because it is worth less over time). Those at the top reap the biggest possible benefits, because hey, there's nothing like free money, especially making money off of free money. As long as we have inflation, ie increasing money supply, we will have increasing economic inequality. |
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| Author: | Proud Ryu [ Fri Dec 14, 2012 12:16 pm ] |
| Post subject: | Re: Fiscal Cliff |
Bradley Witherberry wrote: Fear breeds passivity. Too true. |
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| Author: | Tyler [ Fri Dec 14, 2012 4:21 pm ] |
| Post subject: | Re: Fiscal Cliff |
This sounds like crank economic theory. Deflation benefits nobody. Consistent and low inflation if anything benefits debtors more than creditors. |
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| Author: | Tyler [ Fri Dec 14, 2012 4:22 pm ] |
| Post subject: | Re: Fiscal Cliff |
Granted, QE is useless. |
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| Author: | Proud Ryu [ Fri Dec 14, 2012 4:40 pm ] |
| Post subject: | Re: Fiscal Cliff |
Tyler wrote: This sounds like crank economic theory. Deflation benefits nobody. Consistent and low inflation if anything benefits debtors more than creditors. Probably the best analogy is getting off of drugs. Deflation is like the withdrawal symptoms. It's not very pleasant, but if you want to break the addiction and get back to health you've got to go through it. And for the record, deflation benefits savers and buyers, and those who short stocks if you want to count them too. Creditors benefit from every situation more than debtors, but especially inflation because there's more money to lend and thus more interest to make. |
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| Author: | Tyler [ Fri Dec 14, 2012 7:46 pm ] |
| Post subject: | Re: Fiscal Cliff |
Addiction to what? Where exactly is America's rate of inflation really relevant? Hell, it's certainly not the cause of wealth concentration. |
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| Author: | Proud Ryu [ Fri Dec 14, 2012 11:55 pm ] |
| Post subject: | Re: Fiscal Cliff |
Tyler wrote: Addiction to what? Where exactly is America's rate of inflation really relevant? Hell, it's certainly not the cause of wealth concentration. Addiction to free money, to complete the analogy. Count yourself lucky if you've never had a debt problem, but nation has a crippling one. Inflation is relevant always, everywhere - but they (ie. the bankers) count on most people being just like you, frankly (and the vast majority are), to think it's not a bad thing to have endless inflation, or to think it is somehow a natural occurrence. In fact, it is the steepest tax a people will ever pay. Inflation does not cause the concentration, it is the money for nothing that creates both, like I said. |
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| Author: | Jedi Master Carr [ Sat Dec 15, 2012 12:19 am ] |
| Post subject: | Re: Fiscal Cliff |
Proud Ryu wrote: Jedi Master Carr wrote: Proud Ryu wrote: Check out what happened with the Continental dollar in the US for a key example. Britain's fiat currency also was the main catalyst for the Revolutionary War. quote] Being a historian on the Revolutionary war I have to point this is wrong. First the currency had nothing to do with the American Revolution. Britain put themselves into debt because of the Seven Years War which was costly and then needed to tax the American Colonies. The decision to tax led to revolt and the British government overreacted by sending British troops leading to the Boston Massacre, destruction of Tea, and Lexington and Concord. Still, the revolution was more complicated than that as many colonists wanted to leave for other reasons, specifically the Proclamation Line of 1763 which prevented colonists from settling in western lands. That decision angered many in Virginia like Washington and Jefferson which is why they supported the revolution. I don't doubt your history but unfortunately one must read history from many sets of books to get the full story. I'm not saying you haven't or that I have, but the financial aspect of history seems particularly well-hidden or at least little-known and that's the side I've been most interested in. You could argue that mainstream writers of history often don't understand the financial aspect, or even that the financial powers act to prevent such history from being written into the school books. In any case, it's wrong to say that British fiat currency had nothing to do with the revolution - it had a great deal. The colonies were doing ok using their own colonial currency, and ailing Britain issued a law requiring the colonists to use only Britain's currency, rendering an enormous amount of money unusable legally. From this viewpoint, actual taxation was nothing compared to the raw inability to pay it with what should have been legitimate money. I disagree with that coloration and have never read any legit historian make that argument. When most get into the economic argument they are mainly looking at how the Virginia planters got into major debt and the issue with taxes in Boston. I also don't think any of the revolutionary leaders even made that argument about currency. You are entitled to your opinion, but I just don't agree with it. Anyways don't want to sidetrack this thread with historical arguments. I admit I am more a social and political historian and don't concentrate much on the economic side of what led to the American Revolution. Still, there were many reasons that led to the Revolution, but I think currency was the least important. Things should get interesting here the next week with the Fiscal Cliff talks. I still think there will be a compromise before the deadline. |
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| Author: | Tyler [ Sat Dec 15, 2012 9:49 am ] |
| Post subject: | Re: Fiscal Cliff |
Fiat currency cranks... |
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| Author: | Shack [ Mon Dec 17, 2012 10:32 pm ] |
| Post subject: | Re: Fiscal Cliff |
The real fiscal cliff is the 1 trillion in printed money a year that the Fed is committed to, from a combination of QE3 and what they just replaced Operation Twist with. 1 trillion a year is fuckin insane, good luck with that |
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