tag:blogger.com,1999:blog-53246864840716464.post5667318925668447857..comments2024-02-29T00:46:38.800-08:00Comments on Washingtons Blog: Take the Power to Create Credit Away from the Giant Banks and Give It Back to the PeopleUnknownnoreply@blogger.comBlogger11125tag:blogger.com,1999:blog-53246864840716464.post-72445840197792522602009-11-05T14:20:08.664-08:002009-11-05T14:20:08.664-08:00To Tom Hickey ,
Wow! what a long answer to my post...To Tom Hickey ,<br />Wow! what a long answer to my post, I loved it and it gave me some new research material. I have not focused much on Learner's works but I will now. I was being some what of a wise ass when I said "Those who own the gold will be the biggest winners of going on a gold standard" and they will of course while at the same time it would prevent us from going to full employment. <br /><br />I'm still waiting for an Aussie School type to tell me how they differ from any other Free Market advocates and show how the outcomes would be any different than the last 30 years. <br /><br />Thank you for your reply to my post.Anonymoushttps://www.blogger.com/profile/13156080225918567393noreply@blogger.comtag:blogger.com,1999:blog-53246864840716464.post-76169019473741380012009-11-05T10:22:38.119-08:002009-11-05T10:22:38.119-08:00Great insights from all!
Tom - While I urge every...Great insights from all!<br /><br />Tom - While I urge everyone to choose credit unions (or banks like Shorebank) over commercial profit-seeking banks, credit unions still contribute to creating money as interest bearing debt, the ultimately fatal flaw in the system. I personally use dollar coins as much as possible since coins are the only legal tender available that is not interest-bearing debt masquerading as money. The US Mint will pay the shipping to your door for up to $500 of each Presidential dollar or $5000 Native American dollars in $250 increments. 1-800-USA-MINT . Your bank/credit union can get $25 rolls or $1000 boxes.<br /><br />Regarding the proposal from the American Monetary Institute, the most overlooked feature is the agricultural parity proposal (see page 20 at http://www.monetary.org/amacolorpamphlet.pdf).<br /><br />Randy Cook, President of National Organization of Raw Materials (www.normeconomics.org) and one of the contributors to that proposal recently asked Tom Vilsack, Secretary of Agriculture "When you explained to the President that, by faithfully executing your responsibilities under Title 7, S602 of the U.S. code and regulating agricultural markets at 100% parity, it would begin recovery of our nation's economy in six months and yet would would cost less tham the $780 billion promised in the bank bailout, was the problem that he just didn't believe you?"<br /><br />This alone would produce a tremendous increase in earned income which is currently being replaced/displaced by debt.<br /><br />For a more complete pictute I recommend The Nature of Wealth at www.economy101.netPhillipnoreply@blogger.comtag:blogger.com,1999:blog-53246864840716464.post-21830244560289873012009-11-04T21:44:46.612-08:002009-11-04T21:44:46.612-08:00Hey GW,
Just wanted to pass along a congrats on b...Hey GW,<br /><br />Just wanted to pass along a congrats on being granted contributor rights on Tyler Durden's rag. I've been a follower for quite some time (via M Rivero's aggregator) and look forward to the discussion your posts will engender in the ZH crowd. <br /><br />Best wishes,<br />Grifter (ZH tag)Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-53246864840716464.post-91759221190253207522009-11-04T12:35:59.285-08:002009-11-04T12:35:59.285-08:00Re-adopting the gold standard would lead to a real...Re-adopting the gold standard would lead to a real collapse; asset values would plunge because there would be a LOT less money in circulation. Let's not go there.<br /><br />Nationalizing the Fed would put politicians in control of the money supply. Whoa, let's not go there either.<br /><br />What's Plan C?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-53246864840716464.post-12149669505215144102009-11-04T12:24:31.637-08:002009-11-04T12:24:31.637-08:00Some brief points:
- we already have a hard curr...Some brief points:<br /><br /> - we already have a hard currency; the dollar is pegged at its upper boundary to oil. Right now, $80 dollars is the highest price the productive, physical economy can bear.<br /><br />The implications of the 'Niewe Hard Dollar' are not seen yet, but they will be. They will be and nobody will like it very much. The Niewe Hard Dollar is quite deflationary and the dollar short squeeze that will run along with the end of the dollar carry trade will resemble a financial hurricane.<br /><br /> - Having the government create credit is just as bad as having banks create credit. Leaving aside for one minute that no system is better than its participants, the CONCENTRATION of credit formation itself rather than WHICH CONCENTRATION is responsible for credit creation ... is the problem.<br /><br />There is a lot more to be written about this but I will leave it for later as I have to get ready for a trip to New Orleans. Nevertheless, shuffling credit formation from one accountable entity to another will change nothing, and in fact would likely make matters much worse.Steve From Virginiahttps://www.blogger.com/profile/04002636865996847926noreply@blogger.comtag:blogger.com,1999:blog-53246864840716464.post-56015970555576715842009-11-04T10:25:18.654-08:002009-11-04T10:25:18.654-08:00@ Grey Tiger
It's more complicated that who h...@ Grey Tiger<br /><br />It's more complicated that who holds the gold. In a broad sense, economics studies opportunities and constraints. Fixing the value of currencies to gold is a voluntary constraint. There is no intrinsic need to do so. What are the advantages and what are the disadvantages and which outweigh which? This is hotly debated.<br /><br />Austrian School economists think that the intrinsic value of money is its commodity value, so fiat money has no intrinsic value and is unsound. Conversely, currency that is convertible into gold on demand is sound. While that may true to some degree, the constraints engendered thereby restrict the abilities of sovereign governments to influence their economies, e.g., to reduce unemployment. Under a sound money system, rebalancing the economy falls to market forces, which are unmindful of human suffering. In addition, gold-back money has a fixed exchange rate in the international trade, forcing governments running trade deficits to buy gold. This further inhibits the governments ability to set economic policy. That's fine with Austrians, who think that market forces should be independent of all government influence.<br /><br />Neoliberals (9n general) think that sound money is too restrictive and should be replaced with another voluntary constraint — fiscal responsibility in the administration and Congress, and monetary discipline at the Fed. this reduces the ability of the government to influence the economy through spending (deficits). The idea is that fiscal responsibility will preserve monetary stability and avoid inflation (the bane of creditors like banks and bondholders). However, it necessitates a stock of unemployed to stabilize the low wages of labor. According to NAIRU (non-accelerating rate of inflation) this is effectively 5-6% unemployment. So when unemployment falls below 5%, the Fed should cool the economy by raising rates. (Note that asset appreciation is not considered inflation, only price and wage increases, favoring you know who. This lead to the current asset bubbles that are in the process of blowing up.)<br /><br />At the opposite end of the spectrum, modern monetary theory modeled on Abba Lerner's functional finance principles holds that a non-convertible sovereign currency with flexible exchange rates gives government maximum control of economic policy, enabling it to achieve an equilibrium of full employment with price stability, which is held to be an impossibility by Austrians and Neoliberals. Supporters of MMT hold that a floor under the price of labor inhibits deflation, and as long as the economy is not pushed to overcapacity, government spending will not create inflation.<br /><br />Most progressives and liberal economists hold that returning to a gold standard would be counterproductive for achieving national prosperity with distributive justice and low unemployment. In their estimation returning to a gold standard would be extremely ill-advised. Ultra-conservatives, of course, disagree. Centrists are suck in the "financial responsibility" meme and think it is a necessary constraint when it isn't.<br /><br />Regarding the rest of your post about crooks running the banks, banks are money pots and money pot attract thieves. The way to prevent fraud and embezzlement is to disincentive it through strict accountability to stringent fiduciary rules. Instead the present system favors rent-seeking over profit from production, and it incentives pillaging the safety net by creating "moral hazard" (when you're right, you win; when you're wrong, you get bailed out with no penalty attached.)Tom Hickeyhttps://www.blogger.com/profile/08454222098667643650noreply@blogger.comtag:blogger.com,1999:blog-53246864840716464.post-82087388907809800262009-11-04T06:15:19.349-08:002009-11-04T06:15:19.349-08:00What about the scores of dozens of people every d...What about the scores of dozens of people every day in the U.S. who end their lives due to the psychological weight of their ongoing credit problems?<br /><br />No few of them will be just fresh out of college, mere children... <br /><br />When I went to college, tuition was $127.50 a semester. Credit has certainly made college more affordable for everyone!<br /><br />Beyond those whose lives come to an abrupt end due to the psychological stresses that shape their individual realities, these being effected by the commonly rapacious credit traps of the financial industries, -literally many scores of millions of other Americans will have their health ruined by these same psychological stresses caused by credit landmines intended to harvest millions of human limbs, -through hypertension, obsessive compulsive -eating, drinking and smoking disorders-, depression, marital and family problems, problems re-inflicted upon their offspring, and all of it -too often leading directly to screaming psychosis, murder, and jail, -where human beings are placed in cages under crowded conditions unfit for animals.<br /><br />Too many of society's ills can be traced to the credit economy to justify it any longer.<br /><br />Economists generally have the intellectual capacity of a runaway train headed straight down the track toward oblivion. Throw on some more coal... grind up some more human lives...<br /><br />Credit is a cancer.<br /><br />The credit economy is dead.<br /><br />Too subjective? Everything in this world is subjective. The subjective can make your life a living hell. Especially when someone down on their luck -beats you over the head with a lead pipe wondering -what's in your wallet-.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-53246864840716464.post-71200241524977860052009-11-04T05:54:40.521-08:002009-11-04T05:54:40.521-08:00I just read the American Monetary Institute paper ...I just read the American Monetary Institute paper mentioned above. It starts brilliantly, but then confuses two issues: creation of money by the state and spending on infrastructure by the state. These are SEAPARATE issues.<br /><br />When an extra $Xbn is created, this is NO argument for spending that sum on infrastructure. The question as to how much money to created should be determined mainly by factors like the unemployment level and amount of inflation. In contrast, the decision as to whether to do a particular infrastructure project should be determined purely by the cost and benefit figures relating to that project.Ralph Musgravehttps://www.blogger.com/profile/09443857766263185665noreply@blogger.comtag:blogger.com,1999:blog-53246864840716464.post-82439063637037317292009-11-03T21:52:39.574-08:002009-11-03T21:52:39.574-08:00Wouldn't the people who already own the gold b...Wouldn't the people who already own the gold be the biggest winners by going to the gold standard? How much gold do you own, I don't own any. Ellen Brown has a much better answer. The banking system we had survived for 70 years with violent ups and down but it never crashed like we are about to see. The problem quite simply crooks running the banks. For example Goldman/Sachs gathering up mortgages they knew to be bad bundling them and selling them with false rating (a crime in itself) but then they bought CDS swaps betting they would fail (a fact known to them at the time) insider trading at best) The only problem with allowing the government to print the money is the same crooks we have now who are in bed with the lobbists and corporations will be those controlling the money. I think not. State banks might be the answer but a question of who runs them is huge.Anonymoushttps://www.blogger.com/profile/13156080225918567393noreply@blogger.comtag:blogger.com,1999:blog-53246864840716464.post-17545277912176802102009-11-03T20:07:40.296-08:002009-11-03T20:07:40.296-08:00Excellent commentary, GW. Yes, we start with the c...Excellent commentary, GW. Yes, we start with the certainty that the current system is an oligarchy managing us with political complicity as debt peons. The lowest possible interest rates are a public service we deserve. I've documented a trillion dollars of public benefit every year from monetary reform over the Robber Baron system we have today. States might be the easier place to start, but the banksters will need a change of heart before surrendering profit for the good of the public.Carl Hermanhttp://www.examiner.com/x-18425-LA-County-Nonpartisan-Examinernoreply@blogger.comtag:blogger.com,1999:blog-53246864840716464.post-16501198239374984352009-11-03T19:35:21.326-08:002009-11-03T19:35:21.326-08:00We already have a model that people should conside...We already have a model that people should consider using — nonprofit credit unions. The credit union at which I bank has a "reward" checking account which no pays 4% interest on funds up to $25, 000 with no fees and no minimum balance. The requirements are that you have an electronic transfer to the account once a month, like a social security payment, activation of online banking, and use of a debit card, which is free, twelve times a month. Their MC carries an APR of 8.9% and Visa 10.9, with no annual fee, and a late fee of $15, with a ten day grace period after due date. They also offer loans at competitive rates, and the service is extremely friendly and personal.Tom Hickeyhttps://www.blogger.com/profile/08454222098667643650noreply@blogger.com