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this thread consists of 2 people, who are massaging each others egos
with high fluting academically sounding prose, while denying that the fed is destroying the $US by printing money.
"In 1933 president Roosevelt issued Executive Order 6102, prohibiting the private holding of gold and requiring U.S. citizens to turn over their gold bullion or face a $10,000 fine (equivalent to around $170,000 today) or 10 years imprisonment. '
http://www.abc.net.au/unleashed/4404080.html
17x inflation courtesy of the fed and loss of...
the chinese and russians are laughing at the US.
with high fluting academically sounding prose, while denying that the fed is destroying the $US by printing money.
"In 1933 president Roosevelt issued Executive Order 6102, prohibiting the private holding of gold and requiring U.S. citizens to turn over their gold bullion or face a $10,000 fine (equivalent to around $170,000 today) or 10 years imprisonment. '
http://www.abc.net.au/unleashed/4404080.html
17x inflation courtesy of the fed and loss of...
the chinese and russians are laughing at the US.
M
morganist
Quote from ElCubano:
Im sooo confused....How is fractional reserve money not money creation??? they are creating money through debt...no?
No. When you invest in a bank the money is lent out again. The bank only has to hold a fraction of the amount deposited to cover withdrawals. That is fractional reserve banking. The central bank lends to banks if the fraction they kept to cover withdrawals is not sufficient to cover the amount demanded. There is no money creation in fractional reserve banking. The money creation takes place with things like QE. Some people argue rehypothecation and false asset value for collateral is money creation but I don't think it is.
The basis of fractional reserve banking is simple. It means only a fraction of what you invested is available for you to withdraw at one time and the rest is invested elswhere to make money. It can cause problems but it is not money creation it is just a way of allowing the money you invest to be lent out and enable you to take money out at will. I think what you are refering to is when they expand debt. They increase the period of time people can borrow for or allow a greater amount of the fractional reserve or reserve account at the central bank to be lent out. This increases the amount of money in circulation but it is not money creation it is the use of future income to be expended now and paid later. QE is debasement of the currency and creates new monetary units.
The money expanded in credit is not money creation but it may be overpriced dependent on whether the income of the borrower increases sufficiently to make futre repayments.
M
morganist
Quote from zdreg:
this thread consists of 2 people, who are massaging each others egos
with high fluting academically sounding prose, while denying that the fed is destroying the $US by printing money.
"In 1933 president Roosevelt issued Executive Order 6102, prohibiting the private holding of gold and requiring U.S. citizens to turn over their gold bullion or face a $10,000 fine (equivalent to around $170,000 today) or 10 years imprisonment. '
http://www.abc.net.au/unleashed/4404080.html
17x inflation courtesy of the fed and loss of...
the chinese and russians are laughing at the US.
Who are these two people?
You do realise the fed was set up to cover the cost of withdrawals the fractional reserve created preventing bank runs. There are dubious aspects of operations but more to do with policy expanding credit.
Quote from morganist:
Who are these two people?
You do realise the fed was set up to cover the cost of withdrawals the fractional reserve created preventing bank runs. There are dubious aspects of operations but more to do with policy expanding credit.
once they run out of ammunition we have hyperinflation. they electronically add zeroes to the bank's balance sheet..
Quote from zdreg:
once they run out of ammunition we have hyperinflation. they electronically add zeroes to the bank's balance sheet..
Zdreg, I think possibly the confusion is coming from the difference between expanding the use of money already existing versus increasing the net total supply of money. Notice that in one of Morgan's responses he used the word expand or expansion. This is not the same as the fiat creation of new money, as in QE.
Also, you might not be aware that there have been some very successful communist societies in the past. The Iroquois would be one example, and I'm not as sure about this, but I think the Arawak and some other tribes were successful communist societies, until they were annihilated by Columbus of course. Communism apparently can work in some societies, but not in others.
Also, it might be a good idea to distinguish between making an observation and advocacy. For example in a previous post above you wrote, "...while denying that the fed is destroying the $US by printing money."
Perhaps I am wrong, but I don't recall in this thread any one denying the Fed "is destroying the US dollar by printing, nor acknowledging that. The conversation has been more about the specifics of Fed operation, and the difference between, QE and targeting interest rates directly via monetary policy.
"Also, you might not be aware that there have been some very successful communist societies in the past. The Iroquois would be one example, and I'm not as sure about this, but I think the Arawak and some other tribes were successful communist societies, until they were annihilated by Columbus of course. Communism apparently can work in some societies, but not in others."
this is proof.? 1st one would have to take your word for it.
2. the numbers are small. 3. these are possible examples from centuries ago.
' Communism apparently can work in some societies, but not in others."
it certainly did not work in the former soviet union or in communist china or in africa.
this is proof.? 1st one would have to take your word for it.
2. the numbers are small. 3. these are possible examples from centuries ago.
' Communism apparently can work in some societies, but not in others."
it certainly did not work in the former soviet union or in communist china or in africa.
out in the villages in Mali they are 100% communist and always have been. My son in law was born and raised there. Now he owns his own business here in the USA. And he just hates going home every year because they really work him over. He built two houses there when he first started working as a dishwasher here in the USA. One was for his family (and his father had 13 wives, so families can be pretty big back there), and the other one was just out of the goodness of his heart. It's a place where kids can live during the week in the city where they have a school. It's like a day and a half walk from the village to the school, so kids can only do it once a week. Now they have a place to live during the week when they are at school. On Friday, they make that long trip home again to be back in their communist village.Quote from zdreg:
"Also, you might not be aware that there have been some very successful communist societies in the past. The Iroquois would be one example, and I'm not as sure about this, but I think the Arawak and some other tribes were successful communist societies, until they were annihilated by Columbus of course. Communism apparently can work in some societies, but not in others."
this is proof.? 1st one would have to take your word for it.
2. the numbers are small. 3. these are possible examples from centuries ago.
' Communism apparently can work in some societies, but not in others."
it certainly did not work in the former soviet union or in communist china or in africa.
Quote from oldtime:
out in the villages in Mali they are 100% communist and always have been. My son in law was born and raised there. Now he owns his own business here in the USA. And he just hates going home every year because they really work him over. He built two houses there when he first started working as a dishwasher here in the USA. One was for his family (and his father had 13 wives, so families can be pretty big back there), and the other one was just out of the goodness of his heart. It's a place where kids can live during the week in the city where they have a school. It's like a day and a half walk from the village to the school, so kids can only do it once a week. Now they have a place to live during the week when they are at school. On Friday, they make that long trip home again to be back in their communist village.
it is an interesting story. the point of the story is that it takes a capitalist to take care of a communist village.