Russia to Reduce US Debt Holdings- That's what happens when you print, no one wants y

[shortie]

Quote from toc:

it is predicted that by 2050 Russian population may drop to 100M from currently 147M.

This issue will further hamper the prospects of having another industry help the economy. The industry of agriculture given the global demand boom and thus rising food prices. However, this might be only partially true as these days with advanced tools and machines, even a single man can do a lot in farming.

yes, it is back to the farm age for Russia.

-- Shortie Stolypin Out

 

[Larson]

Quote from Random.Capital:

And yet, America achieved unprecedented levels of wealth and comfort for non-elites in the heart of the reign of "the most corrupt organization ever".

The LTCM debacle and facilitation of the so-called "war on terror" made possible by the Fed's abuse of the "World's reserve currency", has ended that run. You are living in the past. Now US is flat broke on it's back repeating the mistakes of history (Rome).

 

[toc]

There are many economies that have functioned well despite the fact that their debt has gone over 100% value of their GDP. Like the case of the US. GDP around $11-12T and Debt at $14T.

This does not mean US is flat broke. Till the time there is smooth cash flow in the economy and some growth then the engine can keep on running. Just like in the businesses they say 'do not choke up on cash' as that will stop the operations and soon like in few weeks average 30% of the customer base will walk out to the competition, killing the whole business in process. Before you know it, the debtors have called in their debt bonds and then it is all over.


Do not know exactly if that analogy can be applied 100% to a country's case.

Problem that I see is that in US case, there is very feeble attempt to cut the spending and wastage and remove other ills in the economy. This can lead to chronic levels of issues that can really hurt the economic engine and thus the society.

Ego manics in Washington are still playing merry and acting careless.

 

[jinxu]

Quote from morganist:

As corrupt as the system is it has been the most successful wealth distributing system so far. Although it has been based on debt over the last thirty years.

I really think Russia will be the next power house rather than China. It seems to be adopting the sort of model required to enable a more sustainable level of growth and it doesn't have the population problems.

Well, according to this article North Dakota is doing a better job:

...the Bank of North Dakota (BND), currently the nation’s only state-owned bank. While other states are teetering on the edge of bankruptcy, the state of North Dakota continues to report surpluses. On April 20, the BND reported profits for 2010 of $62 million, setting a record for the seventh straight year. The BND’s profits belong to the citizens and are produced without taxation.

The BND partners with local banks in providing much-needed credit for local businesses and homeowners. It also helps with state and local government funding. When North Dakota went over-budget a few years ago, according to the bank’s president Eric Hardmeyer, the BND acted as a rainy day fund for the state. And when a North Dakota town suffered a massive flood, the BND provided emergency credit lines to the city. Having a cheap and readily available credit line with the state’s own bank reduces the need for massive rainy-day funds (which are largely invested in out-of-state banks at very modest interest).

http://www.yesmagazine.org/new-economy/what-a-public-bank-could-mean-for-california

 

[Random.Capital]

Quote from morganist:

I really think Russia will be the next power house rather than China.

I respect your opinion, but don't agree with this. Russia's health is entirely dependent on oil exports - it is a basket case everywhere else - and it's cost of production is rising. It is only a matter of time before Russia gets squeezed, hard.

 

[Random.Capital]

Quote from Larson:

The LTCM debacle and facilitation of the so-called "war on terror" made possible by the Fed's abuse of the "World's reserve currency", has ended that run.

What a wonderful run it was - no other system anywhere in the world allowed such a flourishing of the middle class.

How can that possibly be if the Fed is as all-powerful, all-greedy and all-corrupt as claimed?

 

[the1]

You bring up an interesting point Random. Has the success America has enjoy over the past 80 years been a case of the free enterprise system or because of the existance of the Fed? If you do a bit of research on Empires and Central Banks that have printed money the way the Fed has in recent years you may share my concern about how the story is going to end. Research the history of Rome and Central Banking as one example. What most folks don't realize, however, is Rome collapsed over a period of about 300 years so you and I will most certainly be long gone before the American Empire tumbles to the ground. Tumble it will; all Empires do. Until the day or reckoning arrives....party on my fellow man.

Quote from Random.Capital:

And yet, America achieved unprecedented levels of wealth and comfort for non-elites in the heart of the reign of "the most corrupt organization ever".

 

[morganist]

Quote from the1:

You bring up an interesting point Random. Has the success America has enjoy over the past 80 years been a case of the free enterprise system or because of the existance of the Fed? If you do a bit of research on Empires and Central Banks that have printed money the way the Fed has in recent years you may share my concern about how the story is going to end. Research the history of Rome and Central Banking as one example. What most folks don't realize, however, is Rome collapsed over a period of about 300 years so you and I will most certainly be long gone before the American Empire tumbles to the ground. Tumble it will; all Empires do. Until the day or reckoning arrives....party on my fellow man.

I know you don't want to hear this but I think its success was largely as a result of the industrial movements in the turn of the last century that was spearheaded by J P Morgan.

 

[Texas]

LOL you are still debating, you actually still think there is a debate on money printing as correct or not

LOL citizens don't object to money printing LOOOOLLLL

OMG LOL you think western system of banking is all about fractional reserve lending, you somehow fail to mention private ownership of central banks and lending currency to government as a major difference between Russian Chinese type banking and western you clown


You are so full of shit, not worth my time debating.

You are a know it all that knows Nothing of how the real world works.

Good luck when the time comes for you to stand in the kitchen line when dollar collapses, I sure hope you will have conversation company to explain how you knew this would happen and how regular people are at fault.

You are a joke, if you were on my research team, I would recognize you for what you are and politely ask you to pack your shit

Quote from LeeD:


It is legitimate because laws allow it and citizens don't object. If at any point there was a desire to deprive printing money of legitimacy, it was gold standard. As long as money doesn't have to be backed up by scarse physical commodity, printing money is intended by design if not clearly stated.

Whether it's a "correct" or should I say "right" thing to do, it's a classic argument Keynes vs. Hayek http://www.youtube.com/watch?v=GTQnarzmTOc

Economics is not experimental science. So, no one actually knows what economic measure has what exact effect.

"Western" system is fractional reserve system... and Russia has completely bought into it. So did China.

One thing you seem to miss is "printed" money (or as economists call it M1) is a small part of the actual money in circulation. Most money is created via "fractional reserve system" by private banks. So, in the US with 10% reserve rate every 1bln printed ends up in bank accounts. Banks are allowed to lend 90% or 900mln, which also ends up in bank accounts. And so on. As a result for every 1bln originally issued, banks up to lend 9bln which end up in current accounts. So, every 1bln printed created 10bln in the monetary system out of which 9bln is debt with interest attached payable to private banks.

So, decreasing reserve rate is another very powerful means to increase the amount of money in the system. The government doesn't even have to print money.

 

[the1]

So without JP Morgan the Industrial Revolution never would have happened? Is that your opinion or does your research support your position?

Quote from morganist:

I know you don't want to hear this but I think its success was largely as a result of the industrial movements in the turn of the last century that was spearheaded by J P Morgan.