Topic: How long do you think we have? - page 2. (Read 4450 times)

Here's how it goes

1.fed prints money
2.fed buys government bonds
3.most of the government debt is owed to the fed
4.a few years laters the fed cashes out its bonds
5.a big portion of taxes goes towards paying the fed
6.people get angry and fed up of paying the fed
7.a coup d'etat follows
8.the military junta declares a temporary dictatorship until things settle down
9.people go with it until they get tired of it
10.American springs happens
11.America is reborn as a libertarian nation with sound money, no income tax and a flat tax code(whichever tax will take the income tax place)
or
1.nothing happens and we slowly cut spending and pay the debt

I just wanted to say that I think there is a difference between the "1%" in terms of the financial 1% and the power/politician 1%.  The power 1% control the guns, and the money 1% often (not always, there are bad apples in every group) are trying to protect themselves from the thugs who control the guns. 

As long as so many things are subject vote instead of liberty guaranteed by right, you are going to have corruption and politicians trying to sell themselves to the highest bidder.  There will be no incentive for most of them to remove the temptation since they are profiting from it.  When everything is political, no one is safe from another gang of thugs.

I agree about the implications to BTC etc.  ;-)

Like someone said its a zero sum game, someone has to lose in order for someone to gain. The 1% gains 99% lose means that the 1% can gain ALOT while the 99% barely notices (until now) that it has been losing. The ponzi scheme the US runs affects the entire world not just a nation. Thus the inflation rate is indicative of the fact that the currency is wide spread and used across the globe, meaning that as the system grows and expands some more, that when inflation does it, it will hit so hard that it will completely crush the entire global economy. There's no turning back and nowhere you can go run to avoid a collapse. If you input $5 trillion into the economy and the inflation barely budges this tells you the system is designed to be a too big to fail type of economy in that since a normal nation would be bankrupt by now the US isn't because it is being used across the globe. That doesn't mean you can print $15 trillion more, but just that it will take a longer period of time to realize the inflation since that $5 trillion has to be coughed up by the 99% somehow. The fact that the hockey stick curve is steepening tells me they are prepared to print even more to raise inflation to acceptable levels (nation wide) but forgetful of the fact that it is only because the whole economy relies on the USD that it is why inflation is not rising and it will rise after all that money is flushed out of the hands of the elite and/or military bombs wasting the debt in thin air.

This is the reason btc hit $266 that is no small feat. The pattern it is creating suggests deeper problems for our economy and very bullish for bitcoin economy. Also now that JPM openly is seen to manipulate precious metals, average joe's and investors are looking away from holding PM contracts in the open market and into other forms of investments which act as safe havens (other than jpy/usd/chf). These ones are now in the hands of central bank intervention which will make matters worse long term.

Also you may notice a spike in inflation if and when middle east oil producing nations get away from the petrodollar system and uses something else,a nything else

This status only delays inevitably of economics as you say. It also contributes to the widespread misunderstanding as to whether or not the USD is fallible.

The "wealth" destroyed was perceived paper wealth and not real wealth. It is a correction due tof unny fiat money fabrications.

That applies for both physical goods and services and money still only is a way of exchanging one for another more easily.

+1

Unlike Zimbabwe the US can print a lot more money per unit GDP because it has the reserve currency. No one in the world had Z$ as a long-term store of foreign exchange, or Zimbabwean treasury bonds in an investment portfolio. Eventually however, Fed money printing will cause dollar repatriation back to the US and massive local inflation there.

Some kind of need (security for example) can not be satisfied by goods/services, they need lots of money to satisfy. Economy books usually say that today's saving is for tomorrow's spending, but in reality many people die with lots of money left for his children, and banking families typically accumlate more and more money for each generation

The Fed buying bonds is probably a trick to avoid printing money directly to cover the government deficit. They don't even buy them directly, but via the banks. And they don't really pay the money to the banks, because the payment is deposited directly in the Fed. This is the creation point. The money is created by the fed at the touch of the button, but appears as deposits from the commercial banks. But now the banks have deposits, which is reserve capital, which give them the ability to lend. Nobody can see through that.

Eurostat releases reports for governments debts and deficits.

http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home

http://epp.eurostat.ec.europa.eu/cache/ITY_PUBLIC/2-22072013-AP/EN/2-22072013-AP-EN.PDF

http://epp.eurostat.ec.europa.eu/cache/ITY_PUBLIC/2-22042013-AP/EN/2-22042013-AP-EN.PDF

Those numbers are extremely bad. Very hard to imagine how it could go on for more than 5 years without some kind of defaults or money creation by the ECB. Either way, both are bullish for bitcoin!

Money only is an universal vehicle, device or tool, does not matter how you want to name it, to exchange different types of goods. Money on its own is no wealth at all because if people loose trust in one type of money, it is useless. Money only has value if it is backed by some real wealth, or if people believe in it. And trust in USD falls down the whole time, that's why the "trust" must be exported by force.

Because of money's universal equivalence property, money itself IS wealth. Are you sure that when you lost money, you did not lose any wealth? Economy books always say that money is not wealth, but how come the wealth was destroyed in financial crisis while none of the houses/cars/goods/services were destroyed?

And there is cantillon effect, those who first receive the newly created money have to spend it to cause inflation. If he carefully select his spending target (or even move them oversea), the real inflation on the end of the chain might take years to happen, or not happen at all. The result is that more and more money accumulated at the top of the chain, creating huge gap between rich people and poor people

People in foreign countries where "freedom" was exported by US agents or US military paid the price. Germany did not have that luxury until…well, Hitler came in and exported his version of freedom. You know the rest…

Printing one million dollar or one trillion dollar have totally different effect on inflation. All the currencies destroied by severe inflation had a super speed of money supply increase, like 10 fold in one month. Weimar public added 10 zero for its money supply in just one year



However, Fed has created 4 times more money since 2008 and there is barely any significant inflation. Notice that during the same period, the US GDP just increased a couple of percent per year. So, inflation will not be out of control if the money supply do not increase at a crazy speed

Money does not get created from ass, it is NOT how it works. You socialists should finally learn that, other people do not want to pay for your robbery and spending spree.

For normal people who purchase the bond from government, the debt forgiven is the same as default. But for the money creator it is different, since they don't work to create money, it is just some numbers on their balance sheet

You can write off any debt you want but it will be considered a default.  It could have systemic effects particularly due to the amount of derivatives in the market now like credit default swaps.

Umm... There will be massive inflation. It's a zero sum game. You don't *really* think that printing more paper bills actually generates more wealth (ie, better living standards) for humanity, do you? You just get more money chasing the same goods/services, so people start to competitively bid up prices for things and the overall price level rises. In theory, that has no effect on anything; people would make more money and spend exactly the same amount more money. In practice, it triggers massive friction in the form of ever rising prices (because people fear prices for goods they buy will rise, thus they preemptively raise the prices of the goods they sell, etc...), to the point where it's difficult for business to function because the price level is moving too fast.

A big component of a healthy economy is low friction, and inflation/deflation just add lots of unnecessary friction.

Man are you insane? Sure you can print as much money as you want but such money does not even have the value the of paper and ink they are made of. Have a look at Zimbabwe, that's most recent event of how incredibly stupid your idea is and how it ends.