[Carl Veritas]

Informed Polity?

http://www.mises.org/story/2837

Josh, the Mexican government defaulted on their bonds
and the large NY banks were holding a chunk of it.

The Fed performed for its creators and bailed them out. But bailing the banks, sticking the bill to the American taxpayer while labeling the action as a matter of national emergency needed political and intellectual cover. It was a grandslam right over the peoples heads.

An informed electorate is key, I agree.

But most members of the media and congress all the way up to the white house were drinking from the same punch bowl served at American universities.

How do we fix that?

[Carl Veritas]

Informed Polity?

http://www.mises.org/story/2837

Josh, the Mexican government defaulted on their bonds
and the large NY banks were holding a chunk of it.

The Fed performed for its creators and bailed them out. But bailing the banks, sticking the bill to the American taxpayer while labeling the action as a matter of national emergency needed political and intellectual cover. It was a grandslam right over the peoples heads.

An informed electorate is key, I agree.

But most members of the media and congress all the way up to the white house were drinking from the same punch bowl served at American universities.

How do we fix that?

[Carl Veritas]

The Federal Reserve System can create UNLIMITED amounts of new money. It can and have bailed out:

The Mexican Government
LTCM
Fannie Mae
Freddie Mac
Feel free to add to the list

The systems original prime directive is to prevent runs on the big NY banks who created it. It has now evolved into something that transfers all manners of financial risk (and burden of repayment) to the taxpayers for generations to come. Of course all of this occurs with our elected officials and our own blessing.

Just listen to the crowd cheer as the word bail out is mentioned.

[Carl Veritas]

The Federal Reserve System can create UNLIMITED amounts of new money. It can and have bailed out:

The Mexican Government
LTCM
Fannie Mae
Freddie Mac
Feel free to add to the list

The systems original prime directive is to prevent runs on the big NY banks who created it. It has now evolved into something that transfers all manners of financial risk (and burden of repayment) to the taxpayers for generations to come. Of course all of this occurs with our elected officials and our own blessing.

Just listen to the crowd cheer as the word bail out is mentioned.

[Carl Veritas]

The Federal Reserve System can create UNLIMITED amounts of new money. It can and have bailed out:

The Mexican Government
LTCM
Fannie Mae
Freddie Mac
Feel free to add to the list

The systems original prime directive is to prevent runs on the big NY banks who created it. It has now evolved into something that transfers all manners of financial risk (and burden of repayment) to the taxpayers for generations to come. Of course all of this occurs with our elected officials and our own blessing.

Just listen to the crowd cheer as the word bail out is mentioned.

[Carl Veritas]

The Federal Reserve System can create UNLIMITED amounts of new money. It can and have bailed out:

The Mexican Government
LTCM
Fannie Mae
Freddie Mac
Feel free to add to the list

The systems original prime directive is to prevent runs on the big NY banks who created it. It has now evolved into something that transfers all manners of financial risk (and burden of repayment) to the taxpayers for generations to come. Of course all of this occurs with our elected officials and our own blessing.

Just listen to the crowd cheer as the word bail out is mentioned.

[Carl Veritas]

The Federal Reserve System can create UNLIMITED amounts of new money. It can and have bailed out:

The Mexican Government
LTCM
Fannie Mae
Freddie Mac
Feel free to add to the list

The systems original prime directive is to prevent runs on the big NY banks who created it. It has now evolved into something that transfers all manners of financial risk (and burden of repayment) to the taxpayers for generations to come. Of course all of this occurs with our elected officials and our own blessing.

Just listen to the crowd cheer as the word bail out is mentioned.

[Carl Veritas]

Greek while you’re finding out how Panama fared without a central bank, no FDIC, and no currency of their own, check out the Swiss franc which was backed by gold until very recently.

The free market gave us Americans the high standard of living which some Chinese citizens are just now starting to enjoy, something that eluded the planners for decades.
Those genius Chinese government planners have just discovered
how to create wealth and raise the standard of living:
Just get out of the way.

[Carl Veritas]

Greek while you’re finding out how Panama fared without a central bank, no FDIC, and no currency of their own, check out the Swiss franc which was backed by gold until very recently.

The free market gave us Americans the high standard of living which some Chinese citizens are just now starting to enjoy, something that eluded the planners for decades.
Those genius Chinese government planners have just discovered
how to create wealth and raise the standard of living:
Just get out of the way.

[Carl Veritas]

Greek while you’re finding out how Panama fared without a central bank, no FDIC, and no currency of their own, check out the Swiss franc which was backed by gold until very recently.

The free market gave us Americans the high standard of living which some Chinese citizens are just now starting to enjoy, something that eluded the planners for decades.
Those genius Chinese government planners have just discovered
how to create wealth and raise the standard of living:
Just get out of the way.

[Carl Veritas]

Greek while you’re finding out how Panama fared without a central bank, no FDIC, and no currency of their own, check out the Swiss franc which was backed by gold until very recently.

The free market gave us Americans the high standard of living which some Chinese citizens are just now starting to enjoy, something that eluded the planners for decades.
Those genius Chinese government planners have just discovered
how to create wealth and raise the standard of living:
Just get out of the way.

[Carl Veritas]

Greek while you’re finding out how Panama fared without a central bank, no FDIC, and no currency of their own, check out the Swiss franc which was backed by gold until very recently.

The free market gave us Americans the high standard of living which some Chinese citizens are just now starting to enjoy, something that eluded the planners for decades.
Those genius Chinese government planners have just discovered
how to create wealth and raise the standard of living:
Just get out of the way.

[Carl Veritas]

Greekfire, let me know when you get to the chapter-

The Origins Of The Federal Reserve from Rothbards book “A History of Money and Banking in the United States”.

Our nations history shows that the federal government cannot behave responsibly with money.

Bretton Woods was actually an in-the-middle approach agreed upon by the victorious allies after World War 2. In this, the US dollar was used as a “reserve” currency by the foreign central banks in which they could pyramid their own currencies. And unlike the previous gold standard, only central banks can exchange paper dollars for gold. To make way for this new “gold exchange” system, FDR had Fort Knox built to store the peoples confiscated gold. For their own good no doubt. Influenced by Keynesian economics, the US proceeded to print away while countries such as West Germany, France, Italy and Switzerland began to achieve prosperity without as much printing. The dollar became overvalued in relation to gold and increasingly overvalued against other currencies. The result was chronic and continuing deficit in the American balance of payments from the early 1950s on. This drained the gold out of the country as foreign central banks continued to exchange their paper dollars for gold,
until Nixon finally “freed” the dollar from gold and broke our agreement. Gold was not the cause of the breakdown, it was the the federal governments deep desire to have the ability to spend as it wish without the irritating process of collecting taxes.

Economists say prices are determined by supply and demand in the freemarket. So then the price of borrowing money (interest rates) should be determined by the supply of loanable money, correct?

In other words, if the supply of savings are scarce,
then rates should be high to reflect the scarcity.
This is no arbitrary price(the rate) because this is
the consumers preference with regards to their money. If they want to save more and spend less this month, supply of savings would be up and rates down. The entrepreneurs follow the consumers preference and makes production plans accordingly.
The planners ignore this important price signal and routinely pump bank reserves to force the rates down.
The system gets flooded with new money and sometimes
creates unsustainable production and employment. Unsustainable because since there were no real savings in the first place, so the consumption only continue as long as the money spigot is open.
The bust arrives once the planners decide it is now time to drain bank reserves and force rates upwards.
Now that’s some economic belief system.
Everyone including
the planners blame the malaise on everything else but their own actions. Just turn the TV on and listen.

[Carl Veritas]

Greekfire, let me know when you get to the chapter-

The Origins Of The Federal Reserve from Rothbards book “A History of Money and Banking in the United States”.

Our nations history shows that the federal government cannot behave responsibly with money.

Bretton Woods was actually an in-the-middle approach agreed upon by the victorious allies after World War 2. In this, the US dollar was used as a “reserve” currency by the foreign central banks in which they could pyramid their own currencies. And unlike the previous gold standard, only central banks can exchange paper dollars for gold. To make way for this new “gold exchange” system, FDR had Fort Knox built to store the peoples confiscated gold. For their own good no doubt. Influenced by Keynesian economics, the US proceeded to print away while countries such as West Germany, France, Italy and Switzerland began to achieve prosperity without as much printing. The dollar became overvalued in relation to gold and increasingly overvalued against other currencies. The result was chronic and continuing deficit in the American balance of payments from the early 1950s on. This drained the gold out of the country as foreign central banks continued to exchange their paper dollars for gold,
until Nixon finally “freed” the dollar from gold and broke our agreement. Gold was not the cause of the breakdown, it was the the federal governments deep desire to have the ability to spend as it wish without the irritating process of collecting taxes.

Economists say prices are determined by supply and demand in the freemarket. So then the price of borrowing money (interest rates) should be determined by the supply of loanable money, correct?

In other words, if the supply of savings are scarce,
then rates should be high to reflect the scarcity.
This is no arbitrary price(the rate) because this is
the consumers preference with regards to their money. If they want to save more and spend less this month, supply of savings would be up and rates down. The entrepreneurs follow the consumers preference and makes production plans accordingly.
The planners ignore this important price signal and routinely pump bank reserves to force the rates down.
The system gets flooded with new money and sometimes
creates unsustainable production and employment. Unsustainable because since there were no real savings in the first place, so the consumption only continue as long as the money spigot is open.
The bust arrives once the planners decide it is now time to drain bank reserves and force rates upwards.
Now that’s some economic belief system.
Everyone including
the planners blame the malaise on everything else but their own actions. Just turn the TV on and listen.

[Carl Veritas]

Greekfire, let me know when you get to the chapter-

The Origins Of The Federal Reserve from Rothbards book “A History of Money and Banking in the United States”.

Our nations history shows that the federal government cannot behave responsibly with money.

Bretton Woods was actually an in-the-middle approach agreed upon by the victorious allies after World War 2. In this, the US dollar was used as a “reserve” currency by the foreign central banks in which they could pyramid their own currencies. And unlike the previous gold standard, only central banks can exchange paper dollars for gold. To make way for this new “gold exchange” system, FDR had Fort Knox built to store the peoples confiscated gold. For their own good no doubt. Influenced by Keynesian economics, the US proceeded to print away while countries such as West Germany, France, Italy and Switzerland began to achieve prosperity without as much printing. The dollar became overvalued in relation to gold and increasingly overvalued against other currencies. The result was chronic and continuing deficit in the American balance of payments from the early 1950s on. This drained the gold out of the country as foreign central banks continued to exchange their paper dollars for gold,
until Nixon finally “freed” the dollar from gold and broke our agreement. Gold was not the cause of the breakdown, it was the the federal governments deep desire to have the ability to spend as it wish without the irritating process of collecting taxes.

Economists say prices are determined by supply and demand in the freemarket. So then the price of borrowing money (interest rates) should be determined by the supply of loanable money, correct?

In other words, if the supply of savings are scarce,
then rates should be high to reflect the scarcity.
This is no arbitrary price(the rate) because this is
the consumers preference with regards to their money. If they want to save more and spend less this month, supply of savings would be up and rates down. The entrepreneurs follow the consumers preference and makes production plans accordingly.
The planners ignore this important price signal and routinely pump bank reserves to force the rates down.
The system gets flooded with new money and sometimes
creates unsustainable production and employment. Unsustainable because since there were no real savings in the first place, so the consumption only continue as long as the money spigot is open.
The bust arrives once the planners decide it is now time to drain bank reserves and force rates upwards.
Now that’s some economic belief system.
Everyone including
the planners blame the malaise on everything else but their own actions. Just turn the TV on and listen.

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