What? Are we in an echo chamber? I just explained it. Currency value is determined by domestic purchasing power + IR yield. "A vacuum"? Wtf are u talking about? You do know what purchasing power is, don't you? It's the measure of what you can buy with the little pieces of paper in your wallet. Consumers don't buy yen or francs or euros with their paychecks. They buy gas, food, shelter and stocks. Surely, a better measure of a currencies value is what tangibles can be bought with it? Not how many pieces of other fiat paper can be bought with it?
Krugman: Gas and Food prices have Nothing to do with FED Policy
- Thread starter achilles28
- Start date
What? Are we in an echo chamber? I just explained it. Currency value is determined by domestic purchasing power + IR yield. "A vacuum"? Wtf are u talking about? You do know what purchasing power is, don't you? It's the measure of what you can buy with the little pieces of paper in your wallet. Consumers don't buy yen or francs or euros with their paychecks. They buy gas, food, shelter and stocks. Surely, a better measure of a currencies value is what tangibles can be bought with it? Not how many pieces of other fiat paper can be bought with it?
I already explained this. Twice already. Did you not bother to read my other two posts on the subject? Please scroll.
The exception to the rule doesn't make it wrong. Cheap money finds a home in hard assets (metals, commodities, real estate, stocks). Sometimes its one. Sometimes, its the other. Because cheap money in the '90s didn't find its way into oil, doesn't mean the relationship isn't true. Is it really that difficult?
well let's make a "forever" dollar, like a forever postage stamp (no matter what the rate the stamp will still deliver a first class piece of mail.)
The "forever" dollar would be indexed to inflation, we'll put a upc bar code on each dollar and when the gov't inflation numbers go out, voila, the value of the dollar rises automatically based on the year of the bar code and rate of inflation.
We could have an exchange rate on our own currency from year to year. sounds like fun.
Tie the dollar to gold or a commodity standard. Any other questions?
You do realize purchasing power is determined by stock of money / stock of goods? When money is "printed" via QE or fractional reserve loan creation, the existing stock of money is debased, and hard asset values increase proportionately. Or, in some cases, disproportionately?
what a deception.
"but the dollar has not got down" and compares it to the Euro.
When major currencies debase together what happens. They stay in parity but their purchasing power goes down vis a vis goods and services from outside parties. hence food and oil prices go up.
WTF can't you all see him smiling as he is lying - under his beard...
he smiles as he lies to you. Him and Reich have almost identical condescending deliveries as they lie their asses off.
We live in a dynamic system. These guys answer with false comparisons... to throw you off the trail. They are nasty dudes. They are smart lying leftists... just smart enough to fool t.v. personalities and leftists.
Where troubles melt like lemon drops far above the chimney tops, and rivers are made of chocolate?Quote from nutmeg:
well let's make a "forever" dollar, like a forever postage stamp (no matter what the rate the stamp will still deliver a first class piece of mail.)
The "forever" dollar would be indexed to inflation, we'll put a upc bar code on each dollar and when the gov't inflation numbers go out, voila, the value of the dollar rises automatically based on the year of the bar code and rate of inflation.
We could have an exchange rate on our own currency from year to year. sounds like fun.
