it's all about business cycle theory and OMOs (buying of treasury bonds and "creating" money). from what i remember from macro, it increases wealth in the short term to jumpstart employment and up wages. however, as wages go up so does the price of goods (you have more money to spend, so simple supply/demand increases prices --- inflation), so in the long run wealth stays the same.
it's the fed's job to make sure the economy doesn't collapse from short term events like unemployment or mass-inflation/deflation. in the long term, like i said, our purchasing power stays the same - no matter the value of the dollar. that's why i laugh at naysayers who are convinced the fed will ruin the economy for years to come.
the fed can also issue bonds and essentially destroy the money used to pay for them, so they can take money out of the market as well.
once the fed prints more currency to buy bonds, it's not going to cause mass inflation because they have the means to take money out of the system.
to oversimplify it, fed buys bonds = inflation. fed issues bonds = deflation.
when in macro i had to calculate through some pyramid chart of how the fed "creates wealth" through the banking system by some exponential formula. the amount of money in the system is exponentially greater than the amount of currency.
that's all i remember off the top of my head because i switched majors when i got into the economic statistics portion of the degree and had to find the derivatives of curves and fit an explanation for short term fluctuation. that's why im oversimplifying and am probably wrong on all accounts. im doing something completely different now with school, and it's much more satisfying.
Last edited by The Reckoning; 11-18-2010 at 02:56 PM. Reason: grammar
i agree with ron paul on all of his stances except for economics. if we went back to the gold-standard, we would be the only economy in the world to do so and will collapse.
he advocates a currency based on gold AND silver. silver is very plentiful and allows for more liquidity, and as he says keeps our lawmakers from driving our debt into the stratosphere to keep getting reelected.
parker, i dont care about your "post-doctoral self-study" credentials (whatever the that means). you cannot in anyway maintain an economy as vast and global as the US' based on the price of a precious metal. with the amount of transactions happening everyday, it's impossible. it's borderline re ed.
you can, however, mandate solid fiscal legislation and budgeting like the Texas cons ution does. there's other ways of regulating lawmakers than sending us back into a mercantilism economy.
Parker ripping on a guy with a PhD in economics for not "knowing anything" about the topic of economics.
(my understanding is that scott is a professor of economics teaching somewhere, with a specialty in oil industry, if memory serves)
"post-doctoral self-study" = "I read it on the internet"
or in this case, "I read what Ron Paul thinks".
Why don't you explain it first?
Oh , not another thread about the Fed???
AAAHRRRHRGHGHGGFHRRHGHGHGTRFHTFGHGGH!!!!!!11111
I don't think you understand the true nature of inflation, labor and capital, and their interrelationships
Even if he were to address it, you lack the conceptual framework to understand it.
each has been done. If you didnt pay attention then you wont now.
Please cite this quote.
Parker ripping on a guy with a PhD in economics for not "knowing anything" about the topic of economics.
(my understanding is that scott is a professor of economics teaching somewhere, with a specialty in oil industry, if memory serves)
but he DIDNT. which was my point. You can have tons of theory on tap, but you have to apply it for it to mean anything.
gold/silver std will never happen. Paul admits we will be lucky to audit the fed.
What I know is: our system is failing miserably. its full of criminals who are above the law. And anyone who tells me that this system is the one for us...I dont care what their cred is, is FOS.
And one more thing: if you earn a doctorate in economics these days, barring a miracle you will have the same blind faith/blind allegiance to the status quo that led us down this path in the first place. that being the path to 15%+ unemployment, record profits for the biggest banks, imploding working class, and criminals beyond prosecution.
While clearly not the word for word iteration, the implication is clear.
I will try to get around to reading Mr. Paul's book over Thanksgiving.
I am halfway there. I look forward to it.While clearly not the word for word iteration, the implication is clear.
I will try to get around to reading Mr. Paul's book over Thanksgiving.
If all economists were laid end to end, they would not reach a conclusion.
--George Bernard Shaw
Irish dramatist & socialist (1856 - 1950)
He did address a lot of it. he addressed it by rightfully dismissing it as garbage.
Most of it is simply overly conspiratorial theorizing.
You have, to date, never provided a whiff of actual proof for any "evil motive" you have ascribed to anyone.
No first hand statements, no do entary evidence, nada.
If you like, I can go back through your threads and pull out the specific assertions you have made, here and elsewhere about grand sweeping conspiracies to enslave people.
You ascribe an awful lot of motive without proof, and that is why I remain skeptical, and will continue to do so.
If you can point out one quote I ever made about "enslavement," I will bow down, sir.He did address a lot of it. he addressed it by rightfully dismissing it as garbage. matter of opinion
Most of it is simply overly conspiratorial theorizing.
You have, to date, never provided a whiff of actual proof for any "evil motive" you have ascribed to anyone. $$$ is all you need. unless your the beatles.
No first hand statements, no do entary evidence, nada. You want bank statments?
If you like, I can go back through your threads and pull out the specific assertions you have made, here and elsewhere about grand sweeping conspiracies to enslave people.
You ascribe an awful lot of motive without proof, and that is why I remain skeptical, and will continue to do so.
Economics is a tool, and I like what the Paul approach offers. It agrees with my opinion on what this country needs right now.
I seem to remember more than one quote saying that the purpose of the Fed was to make us serfs/slaves to the "man" or something similar.
I'll check. My memory has been known to be fallible.
no that one was mine. But it was not meant in a literal bondage sense...more of cradle to grave indebtedness sense. How could anyone argue this point?I seem to remember more than one quote saying that the purpose of the Fed was to make us serfs/slaves to the "man" or something similar.
I'll check. My memory has been known to be fallible.
I dont know that I should bow on that though.
Guilty of exaggeration? I don't see how anyone could argue with that.
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