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You'll get paid in I.O.U.'s

Naw, they'll just print / tax.

How can it go up?

I'm surprised they sold any units. Green shoots !!

1) This is my point exactly. The Fed's "research" just exacerbates the issue, whereas a stable and consistent rate of money growth (could fluctuate within a small band) would, in the long run, be the optimal and less rocky road. Instead of focusing on short run disturbances and sacrificing long...

1) When I say exogenous, I'm referring to bodies such as the Federal Reserve, which often base their decisions on short-term, meaningless data and erroneous assumptions. You could call the decisions of bankers endogenous in that it is based on a Nash equilibrium. The point I'm trying to make...

I've had training in graduate economics (a few phd-level courses, I'm a finance graduate student), and I've studied the Solow model and understand intertemporal consumption models. These have nothing to do with the basic idea I'm trying to communicate. And when I said to model GDP...

The growth caused by any "capital" creation (credit) in excess of the rate of saving of the economy is, by construction, unsustainable. It will cause inflation for those not "in the loop" of the credit, it will cause asset bubbles and periods of rapid deflation. Imagine a stable, upward...

I think the system should consist of: a) Fiat money b) Growth of money supply = rate of historical GDP growth associated with innovation (~3% +/- 100 bp's), would need detailed economic analysis to calculate. c) The growth rate should be applied consistently and through the mechanism of...

Changing consumer trends, new technology, structural changes, etc. They would rise or fall based on these factors, triggering unnecessary inflation or deflation in unrelated goods markets. Of course, re-balancing may keep the generalized "Manhour" constant, but it would take significant...

Won't work because prices of many goods may not be linked with a generalized labour aggregate number. If general wage levels rise --> Rise in value of each unit of currency --> Deflationary forces on all goods with the same demand/supply levels as before --> Wages fall /...

You answered your own question. Real, structural, economic problems and massive debt implosion + Monetary sleight of hand tricks and further shoving down our throats of cheap debt = ???

"The Labor Department is scheduled to release its June payrolls report on July 2. The U.S. probably lost 363,000 jobs in June, compared with a 345,000 drop a month earlier, according to economists surveyed by Bloomberg. The unemployment rate, already at the highest level in more than 25 years...

BUT CPI HAS BEEN SO LOW!!!11111!! [/sarcasm]

1) Only occurs because there has been massive layoffs and a decrease in consumer demand. 2) Causes producers to shrink investment --> Why produce next period when the price is only going to fall? 3) A period of deflation will cause further job losses which will cause further deflation...

Yes, first there will be deflation for a period of time as industries close up shop, fire workers, sell inventories at firesale prices, and consumers tighten their wallets. Once these structural forces are finished (could be 1 to 10 years), the loose monetary policies of the fed, rising...

Since when has a president or governing party ever been truly accountable for rapid economic upswings or downswings? If we want to lay blame for 2008, it would be more appropriate to look at the Democratic Congress (Fannie/Freddie), the Federal Reserve's policies of low interest rates...

Neither global warming or military expansionary policies can be supported over the forseeable future.

Exactly what I and many others have been saying: The fractional reserve credit system is unsustainable and bubble-prone. You have 10 people in a community and 10 houses each person currently has $1,000 and makes that much each year. Each house costs $10,000. Let's say you want to wait 5...

If the investor thoroughly informed the client of all the possible risks involved, they deserve 0 punishment of any kind, never mind torture. If the investor invested the client's money in risky assets either against their will or without proper consent and disclosure, the client has the...