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If We Don't Change The Way Money Is Created & Distributed, We Change Nothing
Submitted by Charles Hugh-Smith of OfTwoMinds blog,
The only real solution in my view is to create and distribute money at the base of the pyramid rather than to those in the top of the pyramid.
Many well-intended people want to reform the status quo for all sorts of worthy reasons: to reduce wealth inequality, restore democracy, create good-paying jobs, and so on.
All these goals are laudable, but if we don't change the way money is created and distributed, nothing really changes: wealth inequality will keep rising, governance will remain a bidding process of the wealthy, wages will continue stagnating, etc.
If the money creation/distribution system isn't transformed, "reform" is nothing more than ineffectual policy tweaks that offer do-gooders the illusion of progress.
Mike Swanson of Wall Street Window and I discuss the The Future of Currencies and CHS's New Book A Radically Beneficial World (33:21)
Few are willing to admit that the way we create and distribute money at the top of the wealth pyramid necessarily generates increasing wealth inequality because once we admit this, we realize 1) the money system itself is the source of inequality and 2) we have to change the money system if we want to stave off the inevitable rise of wealth inequality to the point that it generates social disorder.
In the current system, money is created by central and private banks at the top of the wealth/power pyramid, and distributed within the top of the wealth pyramid. The only possible output of this system is rising wealth inequality and debt-serfdom for three reasons:
1. Those with first access to nearly free money can outbid savers and serfs who must borrow at much higher rates of interest to snap up income-producing assets. In effect, borrowing unlimited sums at near-zero rates guarantees that those with this privilege have a built-in advantage in buying income-producing assets. The only possible output of this system is the rich get richer as they buy up all the most profitable and lowest-risk income-producing assets.
2. Those who can borrow virtually unlimited sums at less than 1% interest skim vast wealth by loaning the money out to everyone below the top of the pyramid at 4% (mortgages), 8% (other loans), and 18% (credit cards). This funnels much of the national income stream to those who can borrow cheap and lend the money at much higher rates.
3. Since the wealthy already own most of the income-producing assets, the easiest way to boost their wealth is to bid up those assets with cheaply borrowed money. For example, borrowing $100 million and using it for stock buybacks leverages the value of the shares by far more than $100 million.
Three different perspectives of the wealth pyramid illustrate how our money system generates wealth inequality as the only possible output of the system:
The system of central banks, private banks and fractional reserve lending is global. The net result is that globally, the vast majority of wealth is owned and controlled by those at the very apex of the wealth/power pyramid: the top 8% own 85% of global wealth.
In the U.S., the wealth-income pyramid can be represented by an inverted pyramid: the bulk of wealth and income are in the hands of the top 5%. The bottom 80% own an essentially trivial percentage of the national wealth.
This pyramid illustrates how the money creation and distribution pyramid works:
There are a number of proposed alternatives to this the rich can only get richer and the rest of us can only get poorer system. The only real solution in my view is create and distribute money at the base of the pyramid, to those generating useful goods and services in the community economy, rather than to those in the top of the pyramid. This money isn't borrowed into existence, so there is no interest to be skimmed by its creation.
I explain how this works in my new book A Radically Beneficial World: Automation, Technology and Creating Jobs for All.
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I want to pay for Charles' book.
I would need to be paid to read Charles' book
Paid to read? There's a novel idea. /rimshot
I'm here all week. Don't forget to tip your oligarch.
"If We Don't Change The Way Money Is Created & Distributed, We Change Nothing"
Amen. The headline says all you need to know.
We could start by ending the Fed! What say?
That's the whole point isn't it? Debt money, aka Rothschild Money, IS the problem.....This is just Common Sense, of which there doesn't seem to be much left these days.
Explained in detail in the award winning documentary "The Secret of Oz"
Spoken like a true Obamunist
Please explain what Obama has to do with the Fed, other than being just another lackey....like all the rest. From where I sit, this just seems like another shit-for-brains response to a very serious subject.
Exactly. To find a World Leader who actually changed the Money System for the benefit of his nation, you'd have to look at (ulp)...
Adolf Hitler.
Explained in detail in the award winning documentary "The Secret of Oz"
I bought a copies of "The Money Masters" and sent them to all my "representatives" ... you can see what a profound effect it had. (cough)
Both are very valuable documentaries - The Money Masters is more in-depth, but a tad on the dry side. The Secrets of Oz should be mandatory in schools, I think.
I have a hard time imagining things being better with the Niggerians in control.
Been here 3 weeks. Mr.Argent above has 5 weeks on you. You guys working in tandem?
Stupid, short racist remarks from both of you shitbirds, makes it look like someone wants to hijack the thread and divert attention to the issue being discussed.
Yes, good call. Thanks for the help in clearing those guys out.
The Foney Fed knows they could have that inflation they so desperately crave by putting a little $ in the sheeples' hands...... Hypocrites. End the Fed.
In order to end the Fed congress would have to admit they fucked up, and even worse, they would have to give up a lot of campaign donation and invitations to the elites orgies.....
In order to End the Fed the common man has to be willing to risk his life and limb, storm the Fed, Senate, Congress and the White House and kill every last soul found within.
Nothing short of this will do the job. The Libertarians of today are not Minutemen. That's why nothing happens and why America is screwed.
Well if they use the crisis that is going to follow the latest rate hike to do what I think they are going to do, and implement the E-Dollar, we’ll end up with a more centralized system, not less.
Finally, a blog post I agree with fully!
The money creation entitlement is the ultimate entitlement program in human history, granting its architects almost absolute power.
And the oligarchs with that absolute power will not relinquish it without a most bloody fight!
Maybe he can tweet you installments.
All those with the attention span of a gnat.
"we?"
Charles is right about re-thinking money, but this isn't a policy problem or a failure to understand, it's a problem that those who created this money cartel will conduct torture, murder and mayhem to maintain and protect it.
Power is to truth what black holes are to space: it distorts it and swallows all objects in its path.
Oh, and Merry Christmas to all.
"If We Don't Change The Way Money Is Created & Distributed, We Change Nothing" That pretty much sums up why Charles is so wrong about most things. Money should not be created and distributed by anyone. It should be earned if it is to have real value. Charles always thinks the Fed just needs to change a little bit in order to be a good institution. He hasn't got a clue.
You don't have a clue. You haven't read the book and are very wrong.
The other thing about Charles' thinking is that it is smooth evolution instead of violent revolution. That is rather more advanced than most of the thinking I see in the world. Charles likes positive-sum games, ditto.
Charles thinks about systems, ditto. But he doesn't approach things ideologically, his is a practical, 'understand what you need to know to make it happen' approach.
Most of what we read is some linear extrapolation of the present and the recommendation "kill that trend", whatever mechanisms are appropriate. And the side-effects go on for years, whether called 'blowback' or 'financial contagion' or 'social welfare dependency'.
As soon as anyone starts thinking that way, they give up on the simple and obvious as a route to anything. We are in evolving systems, so we need to be experimenting at the highest possible rates in order to win a better future, which means the smallest feasible units running as differently as possible. The last 300 years have been increasing rates of centralization over literally astronomical increases in the complexity of our systems, of course we are in trouble.
The failure rate of civilization has been very high in the past, and modernity is so young we can't yet tell if we have improved it, but we certainly know we have a lot more of us who can fall much further, so the next catastrophe will be doozy. Six sigma is far in the future.
Our political control systems are not adequate to the task of even evaluating how bad they are.
As long as money is "created" and there is forced use of it - then choice is removed from individual people. Stealing choice is stealing life.
If you love people, if you want to see them learn from and enjoy life, then you must make sure they have the power of choice.
Perfectly stated, Ignatius, perfectly stated!
Thank you Ignatius - very well said and Merry Christmas to you too!
So we end the fed and kike the kikes out of their money and possessions and take away all their weapons and drop them off in Equatorial Africa?
Sounds kike a solution.
Limit wealth thus limit control of wealth. Your are not redistributing it (except initially, they can share the excess with whom they wish, max $10M) but preventing it from building at the top. You can read it my book "how to enjoy life with your limit of $10M" availabe if I ever write it. One can keep the balance at the max but not more. They must keep giving away spreading/excess.
You would have to have someone enforce the limit, and that power gives them control. Wealth is neither inherently good or bad. They can print 100 trillion of their dollars and I don't give a shit, but when they have the power to make me use only their dollars then they have control of me.
It's all about power and control. Always has been , always will be
About 30 years ago Ted Turner claimed all anyone needed was $50M. He had it all worked out with 2 houses, a yatch, crew, staff, and so forth. That would be $100M today. I think you might be off by a factor of 10.
I would suggest eliminating taxation entirely and funding the government entirely (vs. the current partially) via UST bonds and notes. We are already indirectly taxed through money creation as is, an frankly it's a more fair, efficient, and constitutionally sound methodology.
Why fund the government at all? They are the root cause of very nearly all of our problems and a clean solution to few-to-none. The mere existence of the power of the gun we allow the gov means we have a payoff for political contenders to control that, from whence come more problems.
Positive-sum games only, no coercion. That will be a different organization of society, we haven't done that at this scale before. Inevitable, because this system isn't scaling, these are system-level failures we are seeing.
If your political system has been hijacked by outside criminals, as 9/11 shows the US's government to have been hijacked, you were doing things wrong. Systems with clean controls don't get hijacked, or at least it is very clear when that has happened.
Our system is so incredibly broken that most of our citizens are either unaware of the hijack, or are convinced that we have no power to change anything.
Not fixible from inside the system, I think.
Submarine money. OK. Let's get started.
The only change necessary is to limit the amount of "money" which CAN be created via a standard of some sort. Make it the "moon dirt" standard for all I care (decent analogy to BitCoin mining). This way, those who desire greater resources must BID for them, either with existing resources or newly created REAL wealth. This problem has already been solved.
Faith in standards is licence to print money. So you're back to where you started when you just endoursed printed money.
Try again - we've been down that path already.
Charlie is a crook, selling hope and the promise of change to people too dumb to understand how royally fucked they are.
Sound familiar?
I hope he sells a million copies and it becomes a bestseller.
The more people waking up to the subject, the better. I don't know the solution, but the first step to finding one is the identify the problem, and the vast majority don't have a clue where to look.
Anyone informed knows the solution. We all do.
You want to End the Fed and the corruption in the halls of power? You storm them and kill them all. They won't ever stop and we all know it. Enemies of all Mankind to the last.
As to what to use for money...my vote goes to PMs - not standards - PMs AS money.
Worked for the last 5000 years. Gotta be pretty damn arrogant to think fiat is going to work better than that.
When being paid in worthless fiat in exchange for honest work, what has actually occurred is theft via connivance.
What you want is to be paid in something of universally valued worth.
I'll take gold and silver thanks, copper for small change.
Skittles and Rainbows.
Skittles and Rainbows.
Someone give me a skittle shitting unicorn now.
Nice article! Anything makes more sense then what we are doing.
"Anything makes more sense then what we are doing."
That is why I say "nuke them, from space, to be sure."
"The only real solution in my view is to create and distribute money at the base of the pyramid rather than to those in the top of the pyramid."
Don't the oligarchs have their useful dupes mindlessly puke out the words "communism, socialism" whenever this idea is proposed? Couldn't work in this country. Too many useful dupes and morons here.
Who cares about whenever this idea is proposed. Whenever it is implemented the finances go into hyperinflation and then the economy completely collapses.
Communism or socialism don't work - they cause gradual systemic collapse. Corrupt oligarchy doesn't work either.
History teaches us that Man is not a reasonable creature. We are almost never blessed with benevolent masters, which is why history is respledent with revolts and resets.
We're overdue for a big one now.
Why do I get the feeling there would be a new Council Of Elders that decides who is generating useful goods and services, and therefore who gets the new currency and how much they get.
It's all about power and control , always has been, always will be
Not at all. Charles is too serious to see the better solution. Simple, organic, natural.
https://thinkpatriot.wordpress.com/2015/06/03/bonobo-nation/
The article shows that the writer is either a deceiver of woefully ignorant of the money system and human nature. The debt currency is a bad idead to start with. Now we have a conspiracy of players violating laws to place debt on the citizens of America as they redistribue the wealth to the rich and squandering.
Giving money to anyone undeserving as a general policy is doomed to fail everyone. Allowing the undeserving to steal money and place the cost on others is what we have today and just as doomed.
It breaks my heart that the masses care more about who wins dancing with the fucking stars than they do about society as a whole. This system, by design will collaspe and it's not a matter of IF but WHEN. Believe me, at that point they will not give one flying monkey fuck about how good a celebrity danced the fucking waltz.
It breaks my heart that the masses care more about who wins dancing with the fucking stars than they do about society as a whole
I wouldn't worry too much about "them" as they will likely all be dead within a year of the SHTF incident in the USA that is clearly on the horizon. And, sorry, that doesn't "break my heart" since they are all clearly fools. By keeping their heads in the sand for the last 30 years they are largely responsible for this mess we call the US government to come into being (along with their enforcement thugs and alphabet agencies) . . . .
When the Soviet Union collapsed, there was no decimation of the population. Why is there a belief that tens of millios will perish when the US collapses?
A) The USSR didn't have FEMA to help.
B) The USA is 3 generations from farm and garden, our cities and suburbia separate those citizens more from farms, we have no equivalents of the Russian's dachas.
C) The USA in 2015 is far more centrlalized with many more steps between farmer and city than the USSR in 1990.
Criminal class is the same, we haven't developed the street-level criminals that Russia already had, nor the Mafias that quickly sprouted there. Those seem to be gone in Russia now, my wife's customers haven't mentioned them for years that I can recall.
The USA generates more wealth per person, by far, but it is not eatable, and what is eatable is far from the cities. My cousins farm, combines cost many 10s of $1000s and parts are sometimes a problem. 3 people can now farm 3+K acres, you just have to be willing to sit on very large and powerful and expensive tractors 14+ hours a day through planting season and have a banker willing to loan you a lot of $.
I don't keep up with our farm industry, but there are not more than 4 major manufacturers of farm equipment. The eqipment is more automated every year, meaning intertwined with the semiconductor industry. I haven't been in a clean room in 15 years, so don't know the latest, but at that time the big manufactuers knew they were vulnerable to supply-chain problems, and articles I read said autos were vulnerable to single semiconductor plants going down. Do dealers across the US have enough critical parts to prevent loss of planting season?
Most likely we wouldn't lose much of a planting season, and there are enough local machine shops to begin supplying everything for future seasons.
But an EMP, there aren't enough Amish to teach the harness making nor enough horses to run enough farms no enough food stocks to get us past that phase. Nearly none of the land in the west would still be productive, ... But I think it would take that level of catastrophe to cut food production enough, fast enough to prevent recovery.
None of the economy is designed and operated as a fail-safe system, those all fail eventually, more frequently than expected and in larger cascades.
Read Taleb's books, Black Swan, Fooled by Randomness and Antifragile. He is the best thinker in that area I believe. His major point is "no predicting black swans, all you can do is hedge". "
Are we hedged?" you ask. "Against what?" I reply.
...and it is at precisely that point that they will be willing to listen to an answer, not before.
Eve took a bite of the apple and the rest is history.
The whole thing is a scam, top to bottom.
Let it tank.
CHS We don't need to change 'the creation and distribution'...we need a change to money itself. Consider the thoughts of Rueff, Triffin, Zilstra, Duesenberg, Giscard d'Stang, Mueller, Another, FOA FOFOA and rewatch the Ron Paul vs Charles Partee video on YT. The new ways are already with us. The species will adopt new and better ways as old ones fail. We don't return to old failed ways. Merry Christmas.
I will say this is on the right track for it has correctly laid out one of the primary aspects of the human conditon.
Jigokudani Snow Monkey Park (Yamanouchi-machi, Japan)
There an animal cousin will demonstrate social caste sytems at work where if you are in you get in the warm water if you are out you freeze.
A few monkeys decide this "social gatekeepers."
Thus your BEHAVIOR is controlled.
Humans have developed coerciveness into a sublime artform and if that fails we just shoot you and your entire family and end your bloodline.
The root cause of all this is NOT MONEY it's the human conditon and you can't solve it but BUT...... for the rule of LAW and not the rule of MAN.
There is an economist who has already described what Hugh-Smith is saying - that in a fiat monetary system, wealth will always flow to those who handle printed money first.
Who can help me - what's the name of that economist and his "law"
. . . what's the name of that economist and his "law".
I don't know the name of the "author" but the name of the law in the current monetary system is BOHICA - Bend Over Here It Comes Again.
Throughout this piece Smith keeps talking about changing the way "money" is distributed. He is using the wrong terminology with that word since the Federal Reserve Notes used in the USA are NOT money - FRN's are a fiat currency and there is a HUGE difference between money and currency.
If the USA was to actually use money in the banking system the only feasible way to do that would be to switch to a monetary system using paper notes fully backed by, and exchangeable for, precious metals such as silver and gold, which are the oldest form of money (NOT currency) in human history. This was essentially the system that was in place early last century until FDR confiscated all privately held gold and ended the convertibility of the paper currency to gold.
Kennedy issued Executive Order 11110 in the spring of 1963 that allowed the US Treasury to create new "silver certificates" based on the reserves of silver held by the federal government. These notes were actual money since they could be exchanged for physical silver and were in use from the late 1800's through 1971 or so, even after FDR confiscated the people's gold. What JFK's Executive Order 11110 did was it essentially allowed the government to create new money outside of the Federal Reserve System. About 4.3 billion dollars of "new" interest free money was created this way after JFK's executive order. The One Bank wouldn't stand for what JFK did and he was dead within months of creating the new interest free silver certificates. Guess which Executive Order of Kennedy's was one of the first to be rescinded by Johnson when he was sworn in as President?
Right in that case a good monkey decided to be more fair to all the monkey's and so the bad monkeys who wanted to keep the control killed the good monkey and more or less ended his bloodline.
Yep that sums it all up.
You can't get at this without working in the realm of the actual human condition.
If the bad monkey's are in charge they will figure out how to put the rest of the monkeys in their "place" and it WILL NOT MATTER what else you do whatever system you have they will just "CHANGE" it.
However by their actions and what they do they illuminate the path out to the careful observer.
Doesn't work. Putting fiat on a "Standard" only gives licence to continue fiat printing - without limit. That's how the US got to 1971.
Only PMs AS money can solve this. There are solid reasons that have been forgotten as to why they were used as money for 5000 years.
Every person here on the Hedge knows that if you don't own your phys then you don't own it. Putting fiat on a PM standard only returns it to the point of being claim notes.
You can bash your claim notes where the son don't shine. Give me my damn physical or fuck off. Pay me in kind - an item of universal worth in exchange for my hard labour or I'll call you what you are - a conman and a thief.
The premis is correct, but the book title puts the lie to his solution. Give any single group the power to 'create jobs' and you have a tyrant in the making. Ditto for creating money.
The only solution to our economic problems is to go back to equity money and let the market 'create jobs'. Though that could take many forms, the most effective involves:
1. Use Bitcoin and Gold deposit receipts for money.
2. Require that title to all gold deposits stay with the depositor, not the bank.
3. Prohibit banks from making loans.
Anything else is truely a waste of time.
Karl Marx already described our problem.
Capitalists won the battle the earth is predominantly captialist and the Oligarchs won just as he predicted.
Marx was a genius who correctly and completely diagnosed the problem and having done so being at the VERY END of his genius then he continued as humans are prone to do wandering around after this divine inspiration sputtering complete nonsense about the cure.
The answer to the problem of the human condition does not exist in this mortal realm but is more spiritual in nature.
Our ability to see what is good and nobel is higher than our actual nature and thus we sit in the human condition right back were we started forced to cycle through in a spiral like circle forever in giant wheel of tyranny to freedom where we spend most of our time shading towards the tyrannical side of the spectrum it's what we do.
It's one thing to recognize the problem and the required solutions. It's another thing to have the power to do something about it. Unfortunately, the pyramid approach can be used to demonstrate political power as well. The bottom 60% have none, and the the top .1% have it all. We will have to rely on the criminals themselves to make things right. They'd rather kill a few billion of us first.
Wrong. We have to rely on growing a set and storming the halls of the criminals and gunning them down where they stand. That's the only way out of this mess.
FEUDALISM THEN and NOW
https://mises.org/library/cultural-and-political-consequences-fiat-money-0
There is a very good brief synopsis of what fiat money does to a culture.
Sound familiar to anyone?
Mr Smith is still running circles around the golden calf. It's not the distribution but the way we look at this 'money'. If noone out there would accept that 'wealth' provided by paper and such without intrinsic value, the upper xy% would have a lot less power and 'wealth'.
+1000 I see the glory of enlightenment shining down upon you. You got it Haager.
Toilet paper has more value than fiat. Pay me in gold and silver, copper for change.
Haager: Exactly ... and you and I accept that "wealth" provided by the paper ... in spite of it's built in leak (4% graft to the money changers and governments) because it's more efficient than anything else that has ever existed.
But it is "not" more efficient than anything that "can" exist. We can have an MOE management process that (1) guarantees zero inflation of the MOE itself; (2) free supply of the MOE media; (3) perpetual perfect balance between supply and demand for the MOE; and (4) as a result of (1), (2), and (3) universal acceptance in simple barter trade over all time and space.
Our nations founders were the first set of modern people to re-discover some very key principles.
Money is for the people they coded it into the constitution the solution is already sitting there to be RE-discovered not just discovered.
They also gave us a representative republic.
They gave us a gold and silver standard.
They gave us rule of law not men.
The second they gave us this people who knew better than we what it meant began the campaign to disassemble it.
The you are here sticker is moving steadily towards it's return from order to chaos.
They gave us a gold and silver standard.
First of all "know" the writers of the US Constitution gave us nothing. They wrote down some rules over the period of one summer, obtained support from a tiny segment of the entire population which had no explicit support from any of the population, and adopted a set of rules that the people then and all their descendants all were subsequently forced to acknowledge and live by.
In so doing they did a really poor job in many areas. The commerce clause is the most problematic. Language like "general welfare" is also undefinable and leaves a huge hole.
So here is what it has to say about money.
Art. I Sec. 8 Cl. 5
[Congress shall have Power ...] To coin Money, regulate the Value thereof, and of foreign Coin, ...;
Art. I Sec. 10 Cl. 1
[No State shall ...] make any Thing but gold and silver Coin a Tender in Payment of Debts; ...
And you call that a gift? There's obviously not enough of it (gold and silver) to serve as money. And who do you suppose benefited immediately from this assertion? Not owners of land. Not owners of livestock. Not owners of a store of whiskey. Not owners of a silo of corn. Only owners, miners, and refiners of those shinny metals benefited ... and for a while they benefited enormously.
You call that a gift?
Only difference is you write down some "rules" over the period of a few minutes it seems...
not enough of it (gold and silver)
What about too much of it (fiat)?
What about the exact right amount of it (a freely certified in-process trade).
So what goes wrong today (someone promised too much --> the trade defaults), will be fixed tomorrow by interest payments (taken from everyone, according to withglee's crazy theory)!?
And as there will always be enough willing traders, no matter how much interest has to get collected from them, we need no forward looking (risk) control??
But then where do you believe Greenspan's famous "self-regulation" went wrong, if at all.
Or more general what (part) of the current monetary system actually needs fixing -if any-, and in which way?
So what goes wrong today
Governments freely counterfeit. That is what causes "all" the inflation we experience. The problem is compounded by (deliberately) faulty monitoring.
will be fixed tomorrow by interest payments (taken from everyone, according to withglee's crazy theory)!?
Actuarially, propensity to default can be estimated at the time the promise is certified and interest collected for that class of irresponsible trader. Responsible traders obviously enjoy zero interest load. That's the automatic negative feedback mechanism that guarantees zero inflation. It's very very much like the well known process we know as a "mutual insurance company". It's not a theory. Just a description of a very straight forward and obvious process.
And as there will always be enough willing traders, no matter how much interest has to get collected from them, we need no forward looking (risk) control??
Are you really that clueless about actuarial sciences?
But then where do you believe Greenspan's famous "self-regulation" went wrong, if at all.
Greenspan held the fictional interest rate constant for most (all) of his tenure. That simplified things greatly for the traders. They didn't have that arbitrary variable to worry about. Otherwise, he just faked static inflation. You can only stretch the rubber band so tight. We're still experiencing fake inflation. The time constant is proving to be longer than simple modeling would predict. But who can predict manipulator behavior?
Or more general what (part) of the current monetary system actually needs fixing -if any-, and in which way?
Two parts need illumination:
(1) It is traders who create money ... not money changers. It is traders who destroy money.
(2) Governments are counterfeiters of money. They make trading promises they have no intention of delivering. They just roll them over... and that's default that should be mitigated by like interest collections. Further, they grant themselves interest loads as the most reliable of traders ... yet they are the most unreliable ... 100% default rate.
And we need to get away from the ridiculous notion that manipulation of money is about a stable economy and full employment. It's strictly about the money changers farming operation they call the business cycle. It needs to stop ... and traders can make it stop. Leave money creation with the traders (where it belongs) and we'll return to the era of labor shortages ... a time my grandfather spoke of being the case before 1930.
But... we have almost no inflation, according to the BLS? </devil's advocat>
(By the way what is your estimate of the true annual inflation rate.)
Actuarially, propensity to default can be estimated at the time the promise is certified and interest collected for that class of irresponsible trader.
Cool, so the irresponsible trader is taken care of, if that part of your theory works.
Then the second-round question becomes:
Who takes care of irresponsible estimators and certifiers? (Or maybe even -inconceivable- malicious estimators and certifiers? Almost like -cough- in housing 2007, or car and student loans today)
Are you really that clueless about actuarial sciences?
Do you really believe the existence of willing traders is an actuarial issue?
But who can predict manipulator behavior?
Rhetorical weasel words along "nobody could have seen that coming..."
Governments are counterfeiters of money.
Don't governments sometimes act as real traders too? How do you distinguish between the two?
roll[ing] them over... that's default that should be mitigated by XYZ
But the government makes the rules. How does your actuarial science keep them from redefining it as "not a default"?
But... we have almost no inflation, according to the BLS?
Bought rib eyes at the super market lately? It's a necessary scam for the government. If they reported real inflation (including food and energy), they couldn't keep from increasing social security next year. They're in a really bad box and lying is their last tool. That won't work for much longer. Surprisingly, SS does include food and energy and still come up with zero inflation ... so they are even bigger liars.
(By the way what is your estimate of the true annual inflation rate.)
Inflation is impossible to measure so it's kind of ridiculous to try to estimate it. Relating the dollar to gold, it averages 4% compounded since 1913. Even though inflation (of the MOE) can't be measured, a proper MOE management process can guarantee zero inflation. No measurement is necessary. Any price change activity is thus related specifically and only to the objects in question ... not inflation of the MOE itself. And this is a huge improvement.
Cool, so the irresponsible trader is taken care of, if that part of your theory works.
Correct. Look at a mutual casualty insurance company for a robust working model of the mechanisms. And you are correct, irresponsible traders (like governments) are driven from the marketplace. They "can't" create MOE because their actuarial interest load is 100%. They never deliver.
Do you really believe the existence of willing traders is an actuarial issue?
Of course not. But the proper and fair assessment of interest collections in advance of anticipated defaults is definitely an actuarial issue. The controlling relation maintains interest collections perpetually equal to defaults incurred.
Don't governments sometimes act as real traders too? How do you distinguish between the two?
Just as all traders are not equal and need to be actuarially classified, so do governments. If the underwriting finds a responsible trading government entity, their interest load would be assessed accordingly. I don't happen to know of one but perhaps they exist and the actuarial process would determine that.
But the government makes the rules. How does your actuarial science keep them from redefining it as "not a default"?
Defaults are determined by simple subtraction ... the units of MOE they created minus the units they returned. It doesn't get much simpler or more transparent than that.
You are on the edge of an issue but I'm going to watch for you to explicitly discover it. You're close but if I tell you what it is you'll claim you've been saying it all along ... and you haven't. So I'm going to wait until you say it specifically. It's a big underwriting problem and I'm not sure how they would solve it.
In the beginning there are no government rules. It's when people must be bound to operate as one mind that the government camel sticks its head under the tent. A properly managed MOE can be implemented with no government involvement at all. In time it will compete government out of the game. That's when government will try to take charge. But by then the definition of acceptable performance will be common knowledge and transparent to traders. Government failure to meet that standard will not be taken lightly by the marketplace.
Regardless, that's a problem of containment of government. That needs to be separated from the problem of proper management of any MOE. In fact, instituting a properly managed MOE process will go a long way towards containing government largess.
Who takes care of irresponsible estimators and certifiers? (Or maybe even -inconceivable- malicious estimators and certifiers? Almost like -cough- in housing 2007, or car and student loans today)
I'm sure it was "a honest mistake" that you avoided answering on my key point!
Or maybe even -inconceivable- malicious estimators and certifiers?
As the saying goes, it takes a thief to catch a thief. The job is made much simpler with the following attributes of the process:
Compare that to the existing system or any system you would propose or have ever experienced.
Look, withglee has finally discovered simplicity as a positive! (or even a necessity? Nah, he's not there yet.)
So at least one small success.
Malek: So Malek, are you ready to contribute or are you just going to keep popping off from the peanut gallery? I've kept this conversation open far longer than it deserves.
I'm contributing with every single post -
you just aren't willing to respond, except with bullshitting and sidestepping.
You may do what you want but you cannot demand everyone to accept your brainfarts, made out of half wishful-thinking and half ignorance.
I have the play-by-play transcript. I'll run it by others to see if they agree with you.
Go ahead, and give me the results.
Your recent being-voted indicators ZH look... suboptimal.
Go ahead, and give me the results.
Actually, I can't think of anyone to review it with ... but I'll maintain it as a goal and keep my eye out for such a person.
I really do need an objective appraisal. I've never had such difficulty convincing people of the obvious or getting objectors to admit the obvious flaws in their views.
Your recent being-voted indicators ZH look... suboptimal.
I don't know what a "being-voted" indicator is. If you're talking about the up/down arrows, I don't know what optimal is for them ... let alone sub-optimal.
I do know someone votes me down on everything they read that I write. I could write "white reflects better than black" and draw a down from whoever it is. Plus, I would also get an argument. It's too bad we can't be having these debates in real life rather than fielding arrows from the peanut gallery.
So, owning all of the wealth means owning all of the money? Only if you leverage your assets into fiat.
The foxes may not be allowed to run the henhouse, but with Bernie Sanders’ solution and other Fed enablers, the foxes would still own the henhouse property. There’s no way to fix a tyrant by changing the way he rules you. A scientific market system, not politics, should control the value and issuance of money.
Restructuring the Fed according to the nation’s political representation as Sanders suggests, if he is elected president, is not the answer.
The problem is the Fed itself. It must be eliminated. Can you imagine a Federal Reserve Bank operated in a similar manner to the US Supreme Court, with government-appointed radicals and/or ideologues controlling the issuance of the nation’s money supply, and who gets it?
Sanders wrote December 23 in an Op Ed in the NY Times: “If I were elected president, the foxes would no longer guard the henhouse. To ensure the safety and soundness of our banking system, we need to fundamentally restructure the Fed’s governance system to eliminate conflicts of interest. Board members should be nominated by the president and chosen by the Senate. Banking industry executives must no longer be allowed to serve on the Fed’s boards and to handpick its members and staff. Board positions should instead include representatives from all walks of life — including labor, consumers, homeowners, urban residents, farmers and small businesses.”
What a political can of worms, IMO, with guaranteed economic chaos and ruin.
All constraint on money creation would disappear just as it has under the central bankers at the Fed who have taken away the markets for privately-produced and costly money. Either way, special interests would continue to produce for their own profit and pockets money out of thin air.
Each nation, IMO, needs to issue its money nonpolitically, scientifically based on production. This would stop dead the dominance of either the global financial control by a supra-national power of bankers or a “democratic” mob issuing itself money and unbridled power. Either group would manipulate not only money but the nation’s social order.
During a visit to Britain in 1763, The Bank of England asked Benjamin Franklin how he would account for the new found prosperity in the colonies. Franklin replied.
"That is simple. In the colonies we issue our own money. It is called Colonial Script. We issue it in proper proportion to the demands of trade and industry to make the products pass easily from the producers to the consumers.
In this manner, creating for ourselves our own paper money, we control its purchasing power, and we have no interest to pay to no one."
Benjamin Franklin 1
Or, to quote Milton Friedman:
“The power to determine the quantity of money... is too important, too pervasive, to be exercised by a few people, however public-spirited, if there is any feasible alternative. There is no need for such arbitrary power... Any system which gives so much power and so much discretion to a few men, [so] that mistakes - excusable or not - can have such far reaching effects, is a bad system. It is a bad system to believers in freedom just because it gives a few men such power without any effective check by the body politic - this is the key political argument against an independent central bank.”
G.M. Coogan, who stood firmly against the money manipulators,gave her view in Money Creators:
“If the Government (or dictators of government policies such as the Fed) controls the lending of money, it can determine who may or who may not borrow money and hence can control every single business in the country. Controlling every business means controlling every economic activity; control of every economic activity gives power to control also the cultural and spiritual activities of the citizen… Lenin recommended Government origination and control of the medium for exchange. Unless the power to originate money is restricted to sovereignty and scientifically exercised, and lending is restricted exclusively to private, independent, State-chartered corporations, it is nothing short of childish prattle to talk about preventing the onrush of Socialism, or whatever name one wants to use to designate an anti-Christian State, in which all but the ‘chosen few’ are hopeless slaves.”
http://www.nytimes.com/2015/12/23/opinion/bernie-sanders-to-rein-in-wall-street-fix-the-fed.html?_r=1
Most of our problems but not all would be solved with a return to sound money.
We should basically completely abandon debt based money and fiat money as they will consume the earth in search for yield if we don't quit it.
Then on top of this we have a problem with accelerating technology that is allowing immense control with less and less effort and centralizing information flows at astoninding rates and also usurping the ability of a human unit to have value in itself in terms of ability to produce capital and compete with machines in doing so.
So we'd have to develop a really good system of carving out individual liberties with respect to that a new bill of digital anbd technological rights if you will.
Those two things should go a long way in fixing this mess we're in now.
Most of our problems but not all would be solved with a return to sound money.
Define it.
Show how it guarantees perpetual balance between supply and demand for it.
Show how it is in free supply, all the time and everywhere.
These are just two attributes real money must have as it enables simple barter trader over time and space ... which is of course its purpose. If it has these two attributes, it is also a perfect store of value.
Show how sound money is created.
Show how sound money is destroyed.
Bullshit premises. There are no guarantees in life.
Even the Fed cannot gurarantee anything.
A process "can" guarantee a result. We are totally immersed in just such processes. No process that is disrupted can guarantee a result ... but that's not the processes fault.
Thus, the challenge, as always, is to install processes that have robust defenses against disruption. Engineers are very good at this. Lawyers and economists, on the other hand, seem to be driven to deliver an opposite characteristic ... a characteristic that is open to gaming by design.
A process can never guarantee anything.
A well designed process gives it a high(er) likelihood that the desired results are achieved.
the challenge is to install processes that have robust defenses against disruption.
And you are an abhorrent fail in trying to (re-)design such processes. Now guess what my education/profession is.
Based on your comments you are probably an engineer ... as am I. But as you know, there are good engineers, and there are very bad engineers. The bad engineers I have worked with have all been avoiders.
If "keeping it simple, as much as possible" counts as avoiding, then I'm guilty as charged.
Show how your claims are superior to 5000 years of success as sound money for PMs.
Show how your claims are superior to 5000 years of success as sound money for PMs.
Your 5,000 years of success don't exist. And most importantly they don't exist over my 70 years; my fathers 87 years; or my grandmothers 94 years. Of that I have no worse than 2nd hand evidence and over 1/2 is first hand evidence.
Further, a simple reading of just American history over the last 300+ years provides no evidence of its success existing. PMs have been fraught with difficulty when used as money everywhere they have been tried. So have banking schemes where the money "never" stood for what it really is ... "a promise to complete a trade" but was just counterfeit created by anointed elites.
It doesn't have to be that way.
Read your history.
How do you value .... a cradle to grave .... income and benefit stream .... which morphs in sync with ALL your needs .... a la useless eaters .... if a bond is an asset .... a lifetime all inclusive welfare annuity is worth millions .... and represents a huge asset class .... which is not even taken into account .... in this BLS (Bullshit Lying Socialist) reckoning ?
That is simple it has no real value because it can't exist outside a fiat money system because it would never be feasible to pay for it otherwise.
Fiat money ENABLES this abomination.
Sound money would still allow it but put the proper price tag right on it and everyone would say oh fuck no.
hello? the only REAL actual cradle to grave BS going on is Corporate. we are all owned, cradle to grave, by the Nanny Transnational Monopolists. wake up. government is merely a straw man, a proxy, for the global Oligarchy
Fiat money is nothing more than a hidden tax.
It is a clever way to avoid taxation and provide bennies to buy votes.
Sound money requires taxation and taxation goes only so far then people say FUCK YOU!
Fiat money is a worthless lie writ insanely large.
Tax is extortion. Fiat money is theft.
For what it's worth, that's the difference.
Gold is money everything else is credit people have been over this ground before.
In a gold standard the weakness is leverage. Simple example would be the goldsmith giving out 10 promises of the same oz of gold ie leverage ratio of 10 to one.
All leverage must be REMOVED.
Leverage will eventually corrode any money standard and replace it with fiat that ends exactly like it ends now in a constant chase for more and more as it's an epic battle against the tide of constant monetary devaluation.
You must run on the hamster wheel constantly to counter the devaluation of your money.
Sound money is a SANTUARY that allows monetary PEACE OF MIND.
That is something you can NEVER HAVE in a fiat system.
P.S I'm not a gold bug it just historically is the best example of this. It's a universal standard and it has flaws because of limited supply that cause it to be inflexible.
However any flexibility in the system is it's weakness as that's the lever they'll use to attack sound money.
Sound money is a INSANELY high concentration of wealth that is a PRIME target of the money changers they will forever and always attack it from every angle possible.
Debt and leverage are their tools of trade.
Gold is money everything else is credit people have been over this ground before.
No you haven't been "over this ground before".
You always quit just as the conversation concentrates on how much is needed. The assertion that gold is money collapses when you realize the supply and demand for money must be in perpetual perfect balance. Gold can not do that. Thus, gold is automatically disqualified from being called money. It is relegated to the status of any other commodity in that respect.
Why would we want a discussion based on the concept of doing central planning of how much is needed?
Malek:
I don't know why. I don' know who even suggests a concept of central planning or how much (money?) was needed.
My only assertion was that a proper process guarantees perpetual balance between supply and demand for the MOE. I have never said anything about how much (money?) is needed. Rather I have said it must be in perpetual free supply.
Admitedly I have related about there being an insufficient amount of gold to pretend to be money ... but that's your issue (i.e. gold as money), not mine. It's obvious to me and anyone paying the least bit of attention that gold is a very poor substitute for money.
The supply/demand balance guarantee is a snap. It's inherent in every individual trade. Money doesn't exist before the trade and it doesn't exist after delivery (or reclamation of DEFAULT by like INTEREST collection). In the meantime, since the amount involved was agreed by the traders themselves (one supplying, the other demanding) there is obviously a perfect balance all the time ... or no money at all (and we know zero equal zero ... don't we?).
Amazing!
"perpetual free supply" = fairy tale
That's what we have now
Theoretical numbers are a very poor substitute for reality.
That's what we have now
Ah! So you don't want money to be in free supply? You want people to have to get tokens (pieces of eight) to make trades? Why?
Actually, it's not what we have now at all. What we have now is an elite collection of money changers who claim a portion of every trade made. And we have them protected by governments who are allowed to counterfeit at will. That's what we have now.
The amount is irrelevant. In a sound money economy, prices decline as productivity increases. This is what happened in the US during the end of the nineteenth century, when there was a close approximation to a sound money system. Gold is not required for sound money, it is just the best commodity that we have found so far that fulfills all the requirements of a money; but money must be a commodity. It must be something that no one can produce at will. It must come come into existence at a relatively steady rate, and when there is more demand to hold cash balances it becomes more profitable to extract more of the money commodity from the earth / whatever other natural source it may come from.
but money must be a commodity.
Why? You make many assertions in your reply. How do you defend them when questioned? For example I contest:
How do you support these assertions? They go against common sensibility and rational thinking.
In a sound money economy, prices decline as productivity increases.
This is a supply and demand issue and has nothing to do with money. How do you justify letting the supply of money get out of sync with the demand for money?
This is what happened in the US during the end of the nineteenth century,when there was a close approximation to a sound money system.
What kept it from actually being "a sound money system"? One thing that did happen at the end of the 19th century is that gold was challenged by silver to be bonifide money. It failed, though it met all the attributes of money I've seen enumerated (and fails in important ways I've clearly illustrated and discussed). Why was it that the bi-metal system even had to be contested ... let alone banished?
it is just the best commodity that we have found so far that fulfills all the requirements of a money;
I've seen the requirements enumerated but have never seen support for them ... or evidence it is an exhaustive (and/or necessary) list of attributes. Further, it lacks truly crucial attributes of real money serving money's real purpose.
It must be something that no one can produce at will.
Why? Money needs to enable simple barter trade over time and space. I contend it is created by traders and destroyed by traders. What is your contention? Is it that trade cannot exist until money exists ahead of it? If so, why? By your way of thinking, how is money destroyed?
It must come come into existence at a relatively steady rate,
What you describe sounds like an approximation trying to attain an unspecified goal.
and when there is more demand to hold cash balances it becomes more profitable to extract more of the money commodity from the earth / whatever other natural source it may come from.
I agree with the following:
haven't been "over this ground before".
5000 years of using gold and silver as money says you're wrong.
"Perpetual perfect balance" - what rubbish. We don't have that under fiat or any other system either - and never will.
The use of anything as money as an intermediary to help facilitate the exchange of goods and services will always be problematic - we're not trying to create financial Heaven on Earth - we're just trying to escape Hell.
Gold and silver do that - nothing else does. If you aren't being paid in a commodity of universal value you aren't being paid.
Gold and silver do that - nothing else does. If you aren't being paid in a commodity of universal value you aren't being paid.
Except before 1965 I was never paid, nor did I pay, with a commodity of universal value. And the amount of commodity used in my trading activities was minuscule in relation to the total. So if I wasn't being paid in all my trading transactions, but all ended to my satisfaction (i.e. the trade we intended did in fact come about and was delivered successfully) then the issue isn't about "being paid".
And I agree ... it's not about being paid. It's about delivering on a trading promise. The so-called payment is just the closing of the documentation of that promise and its delivery. If you did the trade with an intermediate commodity (i.e. not your desired end goal) of any kind, you have just done a two step barter. You want to call that money? Fine. Having done that, what do you call doing the transaction with simple record keeping if that isn't money?
Gold and silver do that - nothing else does.
How about platinum, palladium and rhodium? Again, what is it about them that makes them not meet your selective definition of money ... relegates them to the "nothing else" bucket? Not enough of them perhaps?
"supply and demand for money must be in perpetual perfect balance"
They always are, at the intersection of the supply and demand curves. With a fixed supply of Gold, the market price for Gold adjusts as the economy grows. Do I really need to explain this to you, you fucking fascist muppet?
With a fixed supply of Gold, the market price for Gold adjusts as the economy grows. Do I really need to explain this to you, you fucking fascist muppet?
You can try. But it's futile ... just like trying to explain to me that Earth is the center of the universe. I'm not going to get it because it "isn't so"!
But try this on "you loving fascist muppet":
A and B enter into a trade involving "x" amount of gold to take place in equal installments over "t" amount of time. If during "t" gold becomes more dear, whose ox is gored. If it becomes less dear, whose ox is gored? The fact is, one trader or the other is harmed by the changing "dearness" of gold. It's indisputable. And traders don't like that.
If gold is to be money (i.e. an accounting of an in-process trade), you can't have it's dearness changing during the process of delivering on the trade. It's a variable and an added degree of freedom the traders don't want and don't need to tolerate. There "is" a better way.
Get it "you loving fascist muppet?"
I get that you are a statist.
"There "is" a better way"
A better way than a free market for money? Who gets to administer that? You? FOAD.
What's more free than traders creating money themselves?
Re. administration: Should people not affiliate to spread risk by forming a mutual insurance company? Insurance is an invention nearly as necessary and useful as money.
They're the same concept. If people shouldn't affiliate to form an MOE management process, they shouldn't affiliate to form a risk spreading process either should they?
Ask yourself. Who administers the activities of a mutual insurance company? What's a better alternative than those administration practices?
So as not to answer a question with a question, "an organization administers an MOE management process". And just as there can be multiple insurance companies, there can be multiple MOE companies.
Get it?
If We Don't Change The Way Money Is Created & Distributed, We Change Nothing
The only real solution in my view is to create and distribute money at the base of the pyramid rather than to those in the top of the pyramid.
Presumably the first sentence of this essay refers to the title. I agree. If you're going to "inject" money into the economy, do it at the bottom (bubble up) rather than the top (trickle down). It will "always" end up at the top but injecting it at the bottom assures that more people touch it on its journey. But don't fool yourself. Such injections are counterfeiting ... which unchecked results in inflation.
The only real solution in my view is create and distribute money at the base of the pyramid, to those generating useful goods and services in the community economy, rather than to those in the top of the pyramid. This money isn't borrowed into existence, so there is no interest to be skimmed by its creation.
I explain how this works in my new book A Radically Beneficial World: Automation, Technology and Creating Jobs for All.
Goes through the whole essay and doesn't say how money "is" properly created ... just where it should be "injected" once created. How much do we read into this "to those generating useful goods and services in the community economy" language. What does that mean? If money isn't "borrowed" into existence, how "does" it come into existence? How does it get destroyed? How is a perpetual balance between supply and demand for it guaranteed? Do you suppose his book tells us? Seems he should have told us in this essay.
There are lots of store keepers who borrow for their floor plan who would be interested to know how they run their business without such borrowing. Most such business require a certain economy of scale to succeed and that can't be reached through savings in a practical amount of time ... just as most people can't come to own a home through first saving and paying cash.
Is that what this essay wants?
This article misses the point, even if it addresses the root accidentally. Distrobution is a symptom of supply. When money is tied to tangible reality (classically gold/silver), then people can only profit/be paid when tangible goods are created. When money is by fiat, those connected to its creation needn't do anything productive to either be paid for economic activity nor pay those whose labor they utilize.
END THE FUCKING FED. DEATH TO THE MONEY CHANGERS.....Bitchez!
agree. I like Quigley's quote about wealth being goods you have and currency is actually a claim on wealth you don't have or anti-wealth.
So > $1million USD networth makes you in top .7 % in the world? Am I reading that right? Does that mean including value of home or just other assets? What would it be to be in top .7% in the US, >=5-10million USD? Based on 2010 census data, $1.6million USD made you enter top .7%: http://politicalcalculations.blogspot.com/2013/01/the-distribution-of-ne...
I cringe a bit when I read ANY suggestion that money should be distributed, becauise you must empower some entity to do the distributing. I do understand the author's desire to exchange one money-distributing system for another that promises a fairer outcome, but what is fair to one person is invariably unfair to the next, and the struggle for what is fair is in essence the struggle for political supremacy - and political subjudiction.
I also take issue with the apparent conflation of money and wealth, where pyramid charts diagraming wealth distribution are used to support a theory on money distribution. Having money - spending money - does not guarantee a proprtionate gain in wealth. And if something of perceived value isn't bought, but is instead made or given or found, is it not also wealth?
The problem as I see it is that there are people who produce wealth, and there are those who benefit from their production without having to produce anything of lasting value. In a simpler economy of an agrarian society, a person produces to excess as far as technology and providence allows. It should be a simple proposition that in order for his excess production to flow to someone not producing anything, he should get something of value in exchange - or the non-productive starve.
So the real question is why are the productive largely the subjects/slaves of the non-productive - the non-productive on both ends and the middle of the socio-economic spectrum? The answer lies somewhere in the fact that the producer's excess production for life - as well as his children's - is encumbered as collateral for borrowing money to enable him to live beyond his means. He is then contractually bound to surrender his excess production to the moneychangers as payment for having achieved a living standard beyond his ability to do for himself.
The same goes for the entire nation - the social safety net, worldwide policing, and ever-more-universal health care are examples of a nation living beyond its means.
Credit is the instrument by which the unproductive assure themselves survival by the sweat of the productive person's brow. Credit is the problem, not money per se. But it is voluntary servitude. Creating the priviledge to issue unbacked credit at risk-free, inflation-free rates is a choice a society makes in order to live beyond its means. Those weilding that priveledge are wise enough to create the illusion of prosperity so they are held up as indespensable; and to the extent that faith in the system is mandatory, are held up as infallable.
Unfortunately, tortuous monetary policy has distorted the real value of production to the point as the stuff most necessary for survival is often the least profitable to produce, and the stuff most trivial to survival - typically mere lifestyle choices - are often the most profitable. So the control/ownership of basic necessities and fundamental means of production can be had cheap these days if you make a Wall Street salary.
Someone here made the enlightened observation a few day back that we are much like the medieval serfs than the people who settled this country - today we work for others who own the means of production in exchange for their money and protection, rather than own the means of production ourselves and accept the risks involved in self-determination. So what happens when fealty is no longer aguarantee that the landowner will want your labor? Predictably, loss of the value of labor leads to dependence on bank credit and state largess, whose people are more than happy to own us.
So here we find ourselves at a time where withholding one's labor is not even a dangerous threat - the powers-that-be have for decades been making one's labor as redundant as possible by either exporting jobs or importing laborers. They need our labor about as much as the banks need our savings, which is about nil.
From my perspective, if you don't have the wealth of a nation created by the hands of its citizens to back a nation's currency, then the currency does not even belong to those citizens. Nor does it have much tangible value since it represents the conduit by which overpaid non-producers can buy the fruits of underpaid producers. So why even accept it if you have produced all you need and more?
Because, of course, we NEED credit to make up for lost value of productivity, haven taken it from both ends - crowded labor market on the one hand and distorted values of production due to monetary policy on the other; and we therefore acquiesce to the valuation of the currency as determined by the creditor. Credit is structural to the economy, especually the 70% of consumption. We could have a barter economy if not for the need to demonstrate income for securing credit - and for taxation, which these days is simply the means for government to have an income against which IT can borrow.
It matters not to me how the Yen is created and distributed, because I do not trade in Yen. And that is true of any currency but the one I transact in. So if I limit my exposure to the dollar by limiting my OWN access to credit then nobody gets rich off my labor from warping monetary policy. So when I exchange my salary immediately for food, shelter, fuel, gold or beer then I feel as if my labor created those things, that I am amassing wealth, and that I've beat the system somewhat.
Vent off. Merry Christmas!
Bravo! Bravo!
Let's see if I can put it to me as it was said to me in my late twenty's, "For things to change I have to change...For things to get better I have to get better."
It's so easy to blame the Rich for me being broke or look to the All Mighty Government to solve my problems.
Kinda makes you think Tyler, "What not start providing solutions to some of the problems this Country, World face in 2016? Quit going to stupid ass movies like the Big Short and start to invest in yourself. Why not? Because people live for being miseable and if that's your case...Vote for Bernie and Tyler. I just say believe in yourself...take a chance, I always amazed how much better that works.
One last note: Think how the world would have been with out a capitalist sytem and a place to use that system called the USA. Look at everything that we have invented and produced. We really are a place where people are dying to get in, not dying to get out. Some believe it's already been lost, maybe...but where else does a place exsit?
Now Tyler, you can do this!
Beam me up Scotty, "By God, I just got my venting out."
There are people who want to do good. but when 100 people have half the wealth and 300 million have the other half, how much opportunity is "really" left. The system was turned into a game that drains everyone except the 100 at the top and if your not one of them get ready to be drained. Do you really think 100 people having half the wealth of 300 million is good, fair or going to work? Im not advocating giving people money who dont work either. Ive worked since I was 15 and Im 43 Ive never had a government benefit? Boomer parents gave them plentiful opportunity and they took everything that wasnt nailed down and they refuse to leave anything in good shape for the generations behind them? Just remember Velocity/Circulation is going nowhere in our current structure.
Agree. Show me a "money distributor" and I'll show you a God damned Communist in desperate need of a meeting with high velocity lead.
I would be down with a real healthy inheritence tax. We would need to dismantle all of these trusts. I never used to be for it until I grew up a bit and also read Jefferson's thoughts on the subject. He did not trust an aristocracy, which is what we have enabled here.
The problem is right now everything, or should I say more than half the wealth of 300 million people is in the hands of 100 people? Anyone who thinks this structure is sustainable has no clue... Its a slow strangulation that is happening right now and wont stop till the structure changes? As it continues to consolidate circulation and velocity continue to slow to a halt....Its creating a log jamb of zero velocity? Wealth does not need to be "distributed" it needs to be shared with people who do work and work hard. Not with people who do nothing? By sharing money with people who do work things start to move. People are able to work hard for money and can spend it...
One of the biggest problems we have is money getting into the hands of people who dont work. They get money for doing nothing, and end up doing even less. The people at the top which is probably not you... even though you think it is, dont work that much either they just scam so they get more? What dont people get about 100 people having the same wealth as 300 million people? May I suggest something is not "Right" with this system? Certainly not sustainable? We have a one-way system that is currently in a full nose dive? Because all the wealth is stuck at the top after decades of consolidation, I would love to know how not changing will work for anyone other than the top 100 and remember your probably not one of them? The idea is we are in a bad place and the pyramids show it clearly, how to get the money "unstuck" and circulating is the real question. When its not ALL at the top circulation happens naturally because people with less spend a higher percentage of their income, in general out of necessity. This is obvious shit.
100 own half the wealth? don't think so.
Sorry more than half, there been so many articles recently on here on it im not sourcing it.. And actually I think its just over 20 people have over half the wealth of 300 million people. Check it that way it will sink in. Ill look quick and see if I can find one.
Sorry for the delay: http://www.zerohedge.com/news/2015-12-06/inequality-america-richest-20-own-more-wealth-half-population
Here's another one: http://www.zerohedge.com/news/2015-10-29/100-us-ceo-have-greater-retirement-assets-116-million-american-workers
I mean really how much opportunity is left? Its certainly dwindling quickly and your not one of them.. no one is exempt. See?
Anyone who thinks we are heading in the "right" direction is probably not "Right".
This is a good read too and I think it shows exactly the result of so few having so much. http://www.zerohedge.com/news/2015-12-17/money-velocity-crashing-heres-why
Bill Gates is #1 @ $76B and Larry Page is #10 @ $33B. The top 10 have $460B in wealth. The top 100 have about $1.4T or less than 2% of private wealth in the US. A good part of the top wealth is in over valued stock. If we confiscated the wealth of these high fliers we would not make much of dent in our government debt. Dream on statists!
Like I said if you think this is the "right" direction your probably not "right".. Quick calculations wont convince me, I think most can feel it... Those are the assets they report. Does that include land? I suggest referring to the Zero hedge article. If the article is off then Im off. I wasnt comparing anything to our debt.
Im referring to the problem with velocity or circulation which is really THE major issue in my opinion right now.
Velocity and circulation goes down as fewer people hold the money.....It happens naturally.... Its basically common sense.
If fewer people have more money = less money spent = problem for all of us. Even those at the top, they are just too blinded by greed to ever realize it. They never do till its too late. Its history over and over.
If we are anywhere even near the range we are talking about we are fucked and it keeps consolidating.. Remember that over the next few months.
I am totally with you that we are headed in the wrong direction. I checked your links and one of them refers to the top 20 people having more wealth than 50% of Americans, but this is far different than them having 50% of the wealth. The bottom 50% of Americans are truly poor if you believe the headlines that 66% or so have no savings or less than $1k in savings. That is truly pitiful, and there are many reasons for this. Some of the reasons lie at the feet of these people themselves and some of them don't.
I want to make it clear I dont think anyone should get a free ride... I have never taken a government benefit in almost 28years, since I was 15... Thats why I explained above a major part of the problem is money makes it into the hands of those who dont work... That includes some at the top too...Major problem, major distortion, automatically puts people who do work behind.. My point is we need to share with those who do and are willing to work? If you dont work, you shouldnt make anything? When people dont have to work and get paid for it, they never want to work again and it creates a downward spiral, not as cut and dry as I just explained but close. I cant stand paying people who dont work because I work hard and have all my life. My point is not to "give" money to people, its to share more of it with those who do work. That I think is the major problem. Working today means nothing? When you can not work and get paid why the fuck would anyone work? Uncle Sham would rather get you in the system and destroy people by not requiring them to work for their benefits.
You have 100 CEO's with larger retirement accounts than 166 million people who work?? Are you still not seeing it? I cant do anymore to convince you accept to say "You will see" at some point it will become clear.
Get an 8x11 sheet of paper make 100 marks on one side.. now make 166 million marks on the other side...
Im not sure what side of the paper you are on, but Im not on the 100 side.
And one thing I am certain of its not about Raising TAXES and Redistribution because Redistribution does not work. Its about getting paid for work. Period. Make the government small they dont help much they only compound the problems we have. Its about rewarding work and not rewarding doing nothing. Our government does nothing and actually cause more problems.
I am with you 100% on what you say in this post. I just had a problem with the original assertion as it did not sound correct. The top 100 wealthy in the US may have more than the bottom 50%, but they do not have 50% of the wealth. Peace
Your right I worded wrong.. Its still a major distortion.
I liked this wording "Study also found that America's wealth distribution now resembles Seattle's Space Needle and not a pyramid"
Read more: http://www.dailymail.co.uk/news/article-3347520/The-richest-20-Americans-wealthy-half-entire-U-S-population.html#ixzz3vLvfcj73Follow us: @MailOnline on Twitter | DailyMail on Facebook
We are in a system of automatic wealth consolidation = NOT GOOD.
Good luck. Any president that fucks with the Fed gets two in the head. And you know it's true.
Augustus knew the answer - kill them first.
The social pyramid is already actually a social toroidal vortex. However, that tends to be deliberately ignored, due to it not being possible to understand "money" more fully without going through some profound paradigm shifts in the ways that we perceive political economy, within the context of human ecology.
Since money is measurement backed by murder, to actually "create and distribute money at the base of the pyramid" would also require transferring a lot of the death controls to "the base of the pyramid." There are basic problems due to the deliberate ignorance maintained by Hugh-Smith's sanguine views regarding "those generating useful goods and services in the community economy."
All of the superficial notions regarding "monetary reforms" tend to fall far short of the need for "monetary revolutions." More realistically speaking, the ruling classes have already set up debt slavery systems, which have already generated numbers which have become debt insanities. Those are going to provoke death insanities. Within the established systems operating via vicious spirals of POLITICAL FUNDING ENFORCING FRAUDS, it is way too unrealistic to promote any notions regarding "monetary reforms," when what is way more probable to actually happen are "monetary revolutions," in one way or another, sooner or later.
In my view, since all the underlying factors have been on exponential growth curves, the changes will be relatively sooner, and primarily take place through the eruptions of death insanities. The essential problems are that the long history of successful warfare based on backing up deceits with destruction morphed to become successful finance based upon enforcing frauds. Those essential problems continue to be regarded by guys like Hugh-Smith, as well as practically everyone else, by thinking in terms of the dualities of false fundamental dichotomies and the related impossible ideals.
The currently established systems developed due to the driving mechanisms of natural selection pressures becoming artificial selection systems which were most socially successful by becoming the most deceitful and fraudulent that those could become. Those problems ought to be regarded as manifestations of general energy systems, operating through unitary mechanisms. However, guys like Hugh-Smith, as well as practically everyone else, continues to be stuck in the old-fashioned ruts of thinking about everything using dualities, which misunderstand how the mechanisms actually work in the most absurdly backward ways possible.
Money, as a human symbol, is primarily a matter of law. However, the only connections between human laws and natural laws are the abilities to back up lies with violence. Hence, our entire political economy has become based on integrated systems of legalized lies, backed by legalized violence, whereby governments enforce frauds by private banks, due to the history of those banks being the best organized criminals, who were able to apply the methods of organized crime through the biggest forms of organized crime, which are governments.
Meanwhile, the vast majority of people were brainwashed to believe in the bullshit about false fundamental dichotomies, and therefore, promote the impossible ideals, whose mechanisms are perceived in absurdly backward ways. Basically, those who like to think about political economy and the monetary system in terms of dualities almost always go to the wrong pole of their dichotomies in order to promote spurious unity. On the contrary, the only ways to better understand and operate the ways that human beings and civilization are already toroidal vortices require using unitary mechanisms, that enable going towards the direction where there are realities, rather than using impossible ideals to go towards the direction where there is nothing.
The genuinely better resolutions would require that enough citizens understood enough that their countries are organized crime gangs, which they are members of, and therefore, they have to better operate the death control systems that back up the debt control systems. That would be the kind of intellectual scientific revolution which would enable REALISTIC ways to "create and distribute money at the base of the pyramid."
Tragically, the only, remotely possible, ways to actually do that appear to first demand that we go through some significant degree of the runaway debt insanities provoking death insanities. Those events are the only feasible ways in which it might be possible to develop different death control systems, which then could sustain different debt control systems, as aspects of the combined money/murder systems, which could be understood as general energy systems, through which human beings and civilizations operated as entropic pumps of environmental energy flows.
Moreover, doing that is becoming more and more difficult, at an exponential rate, because of the ways that the currently established fundamentally fraudulent financial accounting systems have been making "money" out of nothing as debts, in order to "pay" for strip-mining the natural resources of a fresh planet, while turning those into garbage and pollution as fast as possible. The essential problems, as exemplified by Hugh-Smith's series of articles, are that almost everyone deliberately ignores and/or misunderstands how human beings and civilization actually operate as general energy systems, due to the dominance of the biggest bullies' bullshit world views, which are based upon the biggest and best organized forms of organized crime activities being able to publicly present themselves as doing the opposite to what they are really doing. Furthermore, most of the people who have lived inside of that bullshit world view, for generation after generation, almost totally take for granted perceiving everything in absurdly backward ways, and therefore, tend to always promote impossible ideals.
The only things that actually exist are the dynamic equilibria of more or less organized systems of lies operating robberies. That includes "those generating useful goods and services in the community economy." The degree to which those people do not understand, because they do not want to understand, that they too are operating as entropic pumps of environmental energy flows is the degree to which they fail to comprehend that the biggest and best organized gangs of criminals are developing social toroidal vortices which are becoming more and more extremely UNBALANCED.
The only ways to actually REBALANCE the social toroidal vortices appear to require going through eruptions of death insanities, which may make it possible to develop different death control systems. Indeed, the only realistic, best remotely possible, hope is for sufficient radical paradigm shifts in the ways that we perceive the death control systems to become developed enough to catalyze the runaway death insanities, in order that some better dynamic equilibria be enabled to emerge out of that "monetary revolution."
Those who merely promote idealized kinds of "monetary reforms" tend to deliberately maintain their superficial analysis, which do not address the essential ways that money is necessarily measurement backed by murder. The article above by Hugh-Smith was merely another typical example of how reactionary revolutionaries provide superficial analysis, that leads to them promoting superficial "solutions." Indeed, that is the standard fare on Zero Hedge. Of course, on the more mainstream media, there is not even superficially correct analysis, and therefore, not even superficially "correct solutions," other than to keep the established systems based on enforcing frauds going and growing.
At least on Zero Hedge there is much more wide-spread recognition of the ways in which the international bankers are the biggest gangsters, or the banksters, who have captured control over governments, which in turn enforce the frauds by those banksters. However, most of that continues to stay on a too superficial level of analysis, and therefore, almost always concludes with bogus "solutions" that continue to take for granting thinking using dualities, rather than thinking using more unitary mechanisms.
While progress in physical science has been based on series of profound paradigm shifts, that replaced old-fashioned dualities with better unitary mechanisms, almost nothing like that has happen in political science. Rather, we have ended up stuck inside of an oxymoronic scientific dictatorship, that has developed globalized systems of electronic frauds, backed by the threat of force from atomic bombs, which continues to deliberately bullshit about itself as much as possible. Hence the social pyramid systems tend to deliberately NOT understood as toroidal vortices. Rather, the existing sociopolitical systems are being operated by the best available professional hypocrites, promoting impossible ideals, that actually make the opposite happen in the real world. (Which is what the article above by Hugh-Smith was merely yet another typical example of.)
Wealth used to be distributed at the based of the pyramid when labor created all wealth. The elitists then had to find a way to skim wealth from from the masses.
Labor used to be the strength of the economy and the source from which all wealth was created.
Since then, the banking elitists figured out that they do not need to work, all they need to do is create money and create inflation forcing wealth created from labor to lose relative value, rather than the source from which all wealth is created.
Now, realizing this, they are trying to create labor without people and continued skimming/theft of value so that they can have it all.
We should all lock and load. Then they can "have it all".
Nap time. Haven't used the blackberry PlayBook in ages. I have some incredible links. Mrs Atomizer needed a photo. Encrypted to access, had to download under protocol. Stumbled across a old link.
http://publiccentralbank.com/
Old english proverb, "the fools and his money aresoon parted". in a capitalist system the money of the fools at the bottom of the pyramid will soon be gobbled up by the smart and psychopathic at the top of the pyramid