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...says Nbadan, PhD, Internets University.
...they don't call him Helicopter Bernanke for nothing....him addressing anybody on the weakness of the dollar is a logical travesty...
...says Nbadan, PhD, Internets University.
...well, MBA and multiple BA and Science degrees...
Oh, from where and in what fields of study? That is, other than Copying and Pasting.
I don't post personal info...but I am completing a Math Graduate program now....
Ha.
That seems personal.
Ron Paul vs. Ben Bernanke yesterday
http://www.youtube.com/watch?v=jgnfxtrAFJQ
Ok, I have a question that's been bugging me for a while now...I get why basing your currency on an actual commodity like gold is safer than basing it on the future hopes and expectations of an ever growing economy, but why gold? Is there enough "value" in gold to cover our economy? Do we, as people, value gold as much as we used to in "ye olden times"? Something like feudal Japan's currency based on rice seems to make more sense to me (everyone's gotta eat, after all). So anyway, why gold?
I don't remember the context for sure. Wasn’t he speaking of the national deficit and debt? For those, it really isn't that bad. They are still relatively low compared to our GNP. I have always been more concerned about the trade deficit. I will say he must have been high if he was talking about the trade deficit. Can I have some of that good stuff please?
Back to the debt. My conservative instinct tells me that the only time we should run a deficit is during times of war and recession. All other times, we should be paying the interest on the debt, and some principle. If we had always done this, we could afford to make some really grand projects like the past. What if we needed to do something today on the scale of the Manhattan Project, Hoover Dam, or the Interstates? Those projects would not be very viable today as they were in the past, would they?
I am sick and tired of social programs that just create and maintain a class of dependant people. This is the largest uncons utional spending our government does. It needs to be reigned in, or else we are doomed. I am mixed about Social Security and Medicare because I see it as uncons utional, but I have no problems helping our seasoned citizens. I think it should be means tested.
Now I’m no economic guru, never studied economics. What would happen if… Rather than using the payroll deductions as part of the budget, take that money out of circulation since it cannot effectively be invested. Wouldn’t it, through supply and demand strengthen the dollar? Then as people need it for retirement, we print more money. What would the pros and cons of that be I wonder? Wouldn't it be better than what we do today, and force a real picure of the deficit and debt? They say Clinton had a budget surplus. That is not true. Besides not counting the interest on the debt, they counted excessive payroll taxes into the formula rather than treating it as a future debt. I wonder how many people don't know that?
Wow, maybe we can start dumping quarters and nickels on them like they do to us?At 10:58 a.m. EDT, the loonie hit $1.0004, and later traded at 99.86 cents US, up 1.36 cents US from Wednesday.
There’s a good think for our sinking dollar.The high dollar may make U.S.-made goods cheaper to buy in Canada and is a boon to Canadians travelling in the United States, especially cross-border shoppers and those looking to book winter vacations to Florida or Arizona. Those trips are suddenly much cheaper than they were a month ago.
Yep, maybe we will bring more good paying jobs back here again?But the high loonie will continue to put pressure on domestic manufacturers, who have to try to sell goods south of the border at a discount or have been priced out of U.S. markets.
Wow… Maybe more USA made automobiles will be shipped up north! Good for our jobs, right?Manufacturers such as lumber exporters, which have not had some insulation from commodity prices and automakers will be particularly hard-hit, as the rising Canadian dollar makes exports less compe ive at the same time that the shrinking U.S. housing market is making demand for housing weak.
As with other places in the world. Doesn’t that mean more vacationing people will choose to spend their money here instead of elsewhere?Tourism in Canada could also be affected, as travel to Canada becomes more expensive to Americans — a drop that will likely ripple through the hospitality industry.
LOL… Ever think we’d see the day that jobs get sent to us?Rubin estimates that the manufacturing sector could see as many as 100,000 more jobs shed over the next 12 or 15 months, calling it the “obvious” loser of the rising loonie.
“It is getting crushed, no doubt about it, we lost a quarter million manufacturing jobs,” he said.
True, but small changes add up. We learned that the hard way continuing free trade agreements throughout the 90’s.But, he added, “the pain and suffering in the manufacturing sector is nowhere evident when you look at the broad economic numbers.”
That’s the trend we have been having, but it cannot last forever…While the manufacturing sector has lost 289,000 jobs since late 2002, the economy has created more than one million jobs in resources, construction, services, health care, education and financial industries, leaving the national jobless rate at 30-year lows.
precious metals have a historical meaning of wealth. That's all I can think of.
How would we stand by world standards if currency was based on Uranium 235 and Plutonium I wonder?
Yeah, I'm pretty sure he was talking about the national deficit and debt, but saying that any deficit doesn't matter is wrong. But if someone thinks that the national deficit doesn't matter at all then I doubt that they think that the trade deficit matters much either. The only way you can say that a deficit doesn't matter is if you plan on spending like crazy and defaulting on the debt no matter what...
That's the way it used to be until recently. Take a look at this graph.Back to the debt. My conservative instinct tells me that the only time we should run a deficit is during times of war and recession. All other times, we should be paying the interest on the debt, and some principle. If we had always done this, we could afford to make some really grand projects like the past. What if we needed to do something today on the scale of the Manhattan Project, Hoover Dam, or the Interstates? Those projects would not be very viable today as they were in the past, would they?
http://en.wikipedia.org/wiki/Image:U..._1791-2006.svg
You can explain every e in US public debt with your 2 exceptions except the current one we are living in.
1.)We started with debt from the revolutionary War.
2.)Small jump from the War of 1812.
3.)Big jump from the Civil War.
4.)Big jump from WW1
5.)Big jump from the New Deal programs.
6.)Gigantic jump from WW2.
7.)Big jump from Reagan's defense spending to finish off the Soviets, but this is also the period where our modern permanent debt policy begins - it takes off even higher after the Cold War ended. There was a dip around 2000 because tax revenues were high during that bubble period, but then it goes right back up. The government has adopted a policy of ever increasing debt and trade deficits, and the Federal Reserve has adopted a policy of devaluing the dollar everytime a recession looms.
Free trade as gospel truth started with NAFTA in the early '90s, and it looks like Cheney's opinion on national deficits is widely shared, so that explains the government's side. The Federal Reserve in this Greenspan/Bernanke era seems to think that it has the power to prevent recessions forever on the back of the dollar, so that explains their actions, and here we are today. Unless both ins utions reverse their actions in the future there will be a heavy price to pay for these reckless positions they have taken, and the value of the dollar is what will pay that price... along with everyone who uses dollars.
So maybe this period can be explained...We are living on borrowed time from a recession that we are putting off, and the problem just gets worse and worse as we put it off in exchange for short run fixes. That is what is happening right now.
I can't imagine that the founding fathers intended to allow the federal government to withhold income from workers before they even receive their checks. Always remember that FDR's cheif economic advisor was a communist who wrote about his desire to see the USA's economy become more like Russia's economy.I am sick and tired of social programs that just create and maintain a class of dependant people. This is the largest uncons utional spending our government does. It needs to be reigned in, or else we are doomed. I am mixed about Social Security and Medicare because I see it as uncons utional, but I have no problems helping our seasoned citizens. I think it should be means tested.
Taking money out of circulation would strengthen the dollar; the Fed does that when it sells some of its Treasury debt and holds the dollars it receives out of circulation. However, if you are just going to print this money again later to cover a debt, then in the end nothing has changed. But you are on to something: monetizing the debt is exactly what the federal government is going to do once the baby boomers' en lements really pile up; it's that or a massive tax increase. Or some of both.Now I’m no economic guru, never studied economics. What would happen if… Rather than using the payroll deductions as part of the budget, take that money out of circulation since it cannot effectively be invested. Wouldn’t it, through supply and demand strengthen the dollar? Then as people need it for retirement, we print more money. What would the pros and cons of that be I wonder? Wouldn't it be better than what we do today, and force a real picure of the deficit and debt?
Probably alot.They say Clinton had a budget surplus. That is not true. Besides not counting the interest on the debt, they counted excessive payroll taxes into the formula rather than treating it as a future debt. I wonder how many people don't know that?
This all gets complicated, and I don't see it as clear cut as you made it appear. I'll focus on #7. Look at all the social programs that were one by one added, starting mainly I think in the 70's. We came off the gold standard, and had price fixing too. The cold war was a huge hit in the escalating debt, but necessary, and can easily be supported by cons ution. All the social programs developing during the same period cannot be supported by cons ution. Then on top of that, we had double-didget inflation. atarting about 1979. With the debt doubling every 5 years with interest on the inflation alone, how can one objectively blame president Regan?
I blame congress for not putting the priorities right. Still, when the GDP graph is looked at, one could say that it increased more under president Bush(41) than president Regan. Two things military wise were occurring. Desert storm, and the five year reduction of forces. It costs money to do the extra relocating, base closures, and replacing some jobs with contractors. There were also tax increases, that decreased the spending power of us citizens. What actual reason? Who really knows. But I find it less than coincidental that the trend started reversing itself when the republicans took over congress. Still, they had too much pork spending. The graph starts to flatten and slightly increase from the 2000/2001 recession.
The graph doesn't really start increase again until about the time of 9/11. Understandable disaster spending, mobilization of troops, Katrina, etc. A few things back to back. If not for these, the graph would have likely continued downward after the little recession we had. Sure the debt continues to rise in dollar amounts, but the shape of the last few years suggect it should stop at about 68%. At least we have real military deployment to allow for an increasing debt.
I don't like the deficit and debt, but I do believe my view is right. That the debt should only increase in times of war or recession. I can accept the occasional huge program like a NASA project, major infrastructure building, etc. My problem is that the debt is not paid down when it can be, and I blame social spending policies. I don't like the notion that it isn't important, but I agree to the aspect that we are not at dangerous levels. Unless... internal inflation rates go back to high levels.
I think they do the a pint, but only to the point that the dollar gets less spending power on the international market. This would happen slowly anyway as long as we have a trade imbalance.
I agree with you on trade imbalances. As long as we focus on reducing the percentage of debt, we are going in the right direction. It would be preferable to actually pay it down in dollar values rather than percent however. That hasn't happened since Nixon was president, and it was likely just a lucky glitch.
I see it as borrowed time from the trade imbalance, not the actual debt. They both affect our economy, but in different ways. Yet... they have connections too.
The trade imbalance brings us cheaper goods, but at the price of destroying internal supply and demand wages. Rather than workers getting paid more for there work and being able to pay more for USA made products, we settle for cheaper goods. Now this offsets some of the inflation we should have. I don't see our low inflation from treasury control. Prices are increasing. Goods that cannot be outsourced are rising at rates of what our inflation likely should be when averaged. Would this be offset? Hard to say. In general, if we didn't have outsourced products, we would pay more for goods and services, yet make more money too. Inflation would be higher, yet the extra tax revenue would likely keep the percentage of debt neutral. So hard to really say.
Our founding fathers simple never envisioned the huge government we have today. We need to restore states rights and eliminate most of what the federal government has become today.
I don't think we can ever go back to the small government of the past, gut I agree. Taxes on income are counterproductive. Taxes are a necessary evil, so shouldn't we do a better job at collecting them? I say just tax items not essential to living. No taxes on food, toilet paper, toothpaste, etc. Tax the consumption of prepared foods, cars, VCR's TV's luxury items, alcohol, cigarettes, marijuana, etc. Not in a punitive way. Just in the manner of HR 25. The Fair Tax.
I think we are saying the same thing: deficits used to be reserved for war and extremely negative economic cir stances. But now, because of a bigger federal government (that is the result of increased socialism) we run constant deficts. It is all completely uncons utional.
Right now our public debt as a percentage of GDP is higher than it as ever been except for the WW2 period and its aftermath, and 3rd place (New Deal period) is pretty far back. I'm trying to look at that graph and remove the portions that are related to wars: Revolutionary, 1812, Civil, WW1, WW2, Cold, and Current. If you do that, what is happening is obvious: debt for social spending has been increasing since the New Deal. And the biggest social bill in history is about to hit us - thanks to the New Deal. We are becoming more and more socialized. Greater social spending, greater foreign spending - the debt is only going to increase.I blame congress for not putting the priorities right. Still, when the GDP graph is looked at, one could say that it increased more under president Bush(41) than president Regan. Two things military wise were occurring. Desert storm, and the five year reduction of forces. It costs money to do the extra relocating, base closures, and replacing some jobs with contractors. There were also tax increases, that decreased the spending power of us citizens. What actual reason? Who really knows. But I find it less than coincidental that the trend started reversing itself when the republicans took over congress. Still, they had too much pork spending. The graph starts to flatten and slightly increase from the 2000/2001 recession.
The graph doesn't really start increase again until about the time of 9/11. Understandable disaster spending, mobilization of troops, Katrina, etc. A few things back to back. If not for these, the graph would have likely continued downward after the little recession we had. Sure the debt continues to rise in dollar amounts, but the shape of the last few years suggect it should stop at about 68%. At least we have real military deployment to allow for an increasing debt.
Agreed, except we are at dangerous levels, and inflation rates are lied about by the Fed and the government.I don't like the deficit and debt, but I do believe my view is right. That the debt should only increase in times of war or recession. I can accept the occasional huge program like a NASA project, major infrastructure building, etc. My problem is that the debt is not paid down when it can be, and I blame social spending policies. I don't like the notion that it isn't important, but I agree to the aspect that we are not at dangerous levels. Unless... internal inflation rates go back to high levels.
It will happen slowly for years; it will have its ups and downs but it will generally decline (1 step forward, 2 steps back, basically), until one day the foreign dollar holders begin to massively move away from the dollar, and then it will start to decline really fast.I think they do the a pint, but only to the point that the dollar gets less spending power on the international market. This would happen slowly anyway as long as we have a trade imbalance.[
They are very much connected. Both are completley unsustainable, and yes we are on borrowed time from both of them; both will be corrected, and unless the Fed and the government reverse course, the dollar will be the correction mechanism.I see it as borrowed time from the trade imbalance, not the actual debt. They both affect our economy, but in different ways. Yet... they have connections too.
The US treasury has absolutely no control over the inflation rate, as crazy as that sounds. In fact, the US government as no direct control over our monetary policy whatsoever. All official monetary policy is completely in the hands of the Federal Reserve. The Federal Reserve:I don't see our low inflation from treasury control. Prices are increasing.
Is not a part of any branch of the federal government
Is not under the control of the federal government at all
Is owned by private banks
(Sorry, I haven't had a Fed rant in a while.)
Ron couldn't have said it better himself.Our founding fathers simple never envisioned the huge government we have today. We need to restore states rights and eliminate most of what the federal government has become today.
I have noticed for some time now, you and I agree on many things. Sorry if I have to be a spoiled sport about Ron Paul. I like everything about him, except his military stance. Yet... do I really need to repeat that?Ron couldn't have said it better himself.
Yes, the New Deal... The start of the destruction of America. Is there any practical way to get enough votes to overturn all this bas socialism? I see another revolution coming about in a near few decades to come. Probably another civil war to win back states rights.
Learning your multiplication tables now, are you?
Sorry dan, just couldn't resist it. Damn good degree,
and in great demand.
WC, here is an article written by Walter E. Williams,
an economist. I have posted several of his articles.
He contends trade deficits are not bad. And even cites
the depression era when we run trade surpluses.
Trade Deficits: Good or Bad?
By Walter E. Williams
Wednesday, January 17, 2007
Two recent articles ought to give pause to current political and journalistic ignorance, perhaps demagoguery, about our international trade deficit. In a December Wall Street Journal article led "Embrace the Deficit," Bear Stearns' chief economist David Malpass lays additional waste to predictions of gloom and doom associated with our trade deficit.
Since 2001, our economy has created 9.3 million new jobs, compared with 360,000 in Japan and 1.1 million in the euro zone (European Union countries that have adopted the euro), excluding Spain. Japan and euro zone countries had trade surpluses, while we had large and increasing trade deficits. Mr. Malpass says that both Spain and the U.K., like the U.S., ran trade deficits, but they created 3.6 and 1.3 million new jobs, respectively. Moreover, wages rose in the U.S., Spain and the U.K.
Professor Don Boudreaux, chairman of George Mason University's Economics Department, wrote "If Trade Surpluses Are So Great, the 1930s Should Have Been a Booming Decade" (www.cafehayek.com). According to data he found at the National Bureau of Economic Research's "Macrohistory Database", it turns out that the U.S. ran a trade surplus in nine of the 10 years of the Great Depression, with 1936 being the lone exception.
During those 10 years, we had a significant trade surplus, with exports totaling $26.05 billion and imports totaling only $21.13 billion. So what do trade surpluses during a depression and trade deficits during an economic boom prove, considering we've had trade deficits for most of our history? Professor Boudreaux says they prove absolutely nothing. Economies are far too complex to draw simplistic causal connections between trade deficits and surpluses and economic welfare and growth.
Despite all the criticism from abroad and the doom-mongers at home, the world finds our economy attractive. Just as we've been chomping at the bit to buy foreign goods and services, foreigners have been chomping at the bit to invest trillions of dollars in the U.S. Mr. Malpass says our 10-year government bonds yield 4.6 percent per year compared with Japan's 1.6 percent; our government debt is 38 percent of GDP versus 86 percent in Japan; and while Europe's debt to GDP ratio is not as extreme as Japan's, it's not nearly as favorable as ours.
Here's a smell test. Pretend you're a man from Mars knowing absolutely nothing about Earth and you're looking for a nice place to land. You find out that there's one country, say, country A, where earthlings from other countries voluntarily invest and entrust trillions of dollars of their hard earnings. There are other countries where they're not nearly as willing to make the same investment. Which one of those countries would you deem the most prosperous and with the greatest growth prospects? You'd pick country A, which turns out to be the United States. As such, you'd be just like most of the world's population who, if free to do so, would invest and live in the U.S.
The late Professor Milton Friedman said, "Underlying most arguments against the free market is a lack of belief in freedom itself." Some people justify their calls for protectionism by claiming that they're for free trade but fair trade. That's nonsense. Think about it: When I purchased my Lexus from a Japanese producer, through an intermediary, I received what I wanted. The Japanese producer received what he wanted. In my book, that's a fair trade.
Of course, an American auto producer, from whom I didn't purchase my car, might whine that it was unfair. He would like Congress to impose import tariffs and quotas to make Japanese-produced cars less attractive and available in the hopes that I'd buy an American-produced car. In my book, that would be unfair.
Dr. Williams serves on the faculty of George Mason University as John M. Olin Distinguished Professor of Economics and is the author of More Liberty Means Less Government: Our Founders Knew This Well.
Be the first to read Walter Williams' column. Sign up today and receive Townhall.com delivered each morning to your inbox.
©Creators Syndicate
Copyright © 2006 Salem Web Network. All Rights Reserved.
WC: I am posting a link to an interview where he
touches on the same subject. But the interview is
something that is so profound, in my estimation, it
touches on a period of my life and the discipline
that is so distant from todays. It is a damn good
read. Enjoy
http://www.objectivistcenter.org/ct-1750-.aspx
Last edited by xrayzebra; 09-23-2007 at 08:38 AM.
Yeah I think everything we've been arguing about aside from US ME policy is pretty minor. I couldn't disagree too much with anybody who recognizes that the New Deal was the Trojan Horse of socialism in this country.
http://www.spurstalk.com/forums/show...=trade+deficit
temujin - you still out there?
"socialism"
Trotting out that word is typical demagoguery by movement conservatives, you ers stick robotiically to your talking points, that's for sure.
Movement conservatives' only objective is to rape the sheeple and country and enrich the corps and top 2%.
America is "socialastic"? GMAFB
boutons - don't be so knee jerk in your reactions; you and I obviously agree on alot of important issues. I completely understand how corporatism and globalization are negatively impacting our country. Those things are the an hesis of free market capitalism; they are basically monopolism/oligopolism. Don't lump conservatives in with the neocons. Look at all the Ron Paul supporters here.
But to suggest that the USA hasn't gradually become more socialistic since the New Deal is to ignore reality.
Truer words havent been spoken. Why again, did the New Deal get passed? (rhetorical)
Calling out Alan Greenspin....
Too bad Greenspan would never do an interview with someone who might lay it out like that. But even if that happened, Greenspan would just start talking about something else, like Bernanke did with Paul.
Paul: The Fed devalues the dollar to bail out big banks and Wall Street. This housing crises is the result of a near disappearance of risk in the mortgage industry, which the Federal Reserve precipitated by keeping interest rates artificially low for years. What do you have to say about that?
Bernanke: The inflation rate is 2%. Trust me; would a bank lie to you? Next question.
I think these Fed Chairman lie so much for so long that they start to believe their own lies, even when they defy logic and reality. I really do.
Here I thought that was the one and only thing you were never to say if youre being honest. Who knew?
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