Recent content by Rickb

Inflation is allways a net expansion in the money supply (money and credit). That's all. Prices can skyrocket, or plummet for other reasons as well, but it is from somthing called supply and demand, not some other definition of inflation. There are two reasons for prices. Money supply...

Question. Do you think Paulson chose 700b number at random? Any comment on Obama's 1 trillion number? I wonder what the magic number will be. [/B] --------------------------------------------------------------------- Worldwide credit/weatlth (the loss in wealth is from the loss...

Bailouts and printing of money is not causing inflation to occur (yet at least) because that is only one factor. Debt is what you are missing. The net of debt+"money"=inflation. Currently the increasing money is not keeping up with the debt destruction. At the end of the day, you need...

--------------------- I didn't really leave it out. I just don't think it's a primary problem. Like saying Tom Brady can't play football because he doesn't have confidence his knee will work. People don't spend because they know they don't have enough money (money, credit, including...

You example would be correct if the supply of money is a constant. THen if some one losses, someone else gain equally. And you would be right, money would not be created or destroyed. But money, is NOT constant. The average amount of money per person (on average) fluctuates over long...

============================== Respectfully, I don't think it is a red herring. Valuations are comprised of two factors 1)supply and demand of item and 2)amount of money in the system. Assuming the same supply and demand, if the Money/purchasnig power (money + credit) is $400k, share...

===================== It is 9x deposits. PLUS! If you watch all the videos, you'll see that the money mutiplied out by bank one, gets put into another bank, and multiplied again, and again, and again, so you end up with huge leverage. $80-100 of new money created for every dollar (i'm...

============================= Banks lend way more than they have on deposit / actual assets. If a bank has $1 million on its books, they CREATE 9 million to lend. Your demand, and the banks lending, expands the money supply by $9 million more than existed before. Which is why when there...

While in theroy the goverment has unlimited ability to print, they are in fact now constrained by two factors 1)foreign governments, and the big one you need to consider 2)time. I understand your logic, but I just think I don't think they will bother to inflate and just default. THere is...

What I meant was increasing value of currency (strong dollar) makes debt more difficult to pay (value of debt increases in deflation - debt becomes a bigger burden). So my forecast is, deflation will continue, we will just default in a year or two. Government is not going to get the chance...

Everyone everyone assumes that we "Have" to hyperinflate our way out. We may want to consider that a second, more expedient way might be default (with a strong $), followed by a new currency. I think it is a good possibllity they may not bother going to the hyperinflation route.

scriabinop23 has it exactly right. Simply, money= credit. (not actually that simple but...) Credit was created out of nothing by banks to lend out (fractional reserve lending). When debt is defaulted upon, debt gets repaid, or even lending slows from past lending rates, fractional lending...

Agree, deflation is the battle. Private credit defaults (contraction) overcoming goverment monetary stimulus. Fractional reserve banking is running in reverse. Everyone allways assumes hyperinflation must be the only way out of debt. No one considers that default is also an option, and...

I agree with Sumosam. Note Gold was confiscated in 1933, not 1929.

No inflation, deflation Paulson is injecting money, but it is not making up for credit defaults. You have to look at net of injects and defaults.