Posted tagged ‘Printing Money’

Must Reads For The Week 7/16/16

July 16, 2016

Marine’s Attorney: If Hillary Clinton Wasn’t Prosecuted, This Officer Shouldn’t Be Discharged, by Jeff Schogol, at marinecorpstimes.com. This officer tried to warn fellow soldiers about a potential threat by sending them classified information over his personal email account. The bottom line is if Hillary Clinton wasn’t prosecuted, neither should this officer.

Martin Armstrong: James Comey Had No Problem Keeping Me In Prison Without Any Charges, at zerohedge.com. Remember what I said early in the week: The laws don’t apply to the ruling Aristocracy.

Peak FBI Corruption? Meet Bryan Nishimura Found Guilty Of “Removal and Retention” Of Classified Material, at zerohedge.com. Hillary got a mulligan, Bryan Nishimura had to play it as it lies.

FBI Agents Were Told To Sign A Very Very Unusual NDA In Hillary EMail Case, at zerohedge.com. The Queen must be protected. Politics trumps the law.

No, Obama, It’s Not Easier For A Teenager To Buy A Glock Than A Book, by Sean Davis, at thefederalist.com. It is hard to believe a politician would lie fudge the truth just to advance his agenda.

We’re Witnessing A Complete Breakdown In Western Values, at theburningplatform.com.  Excerpt from the article: “The West adopted core values, like the sacrosanct protection of private property; the ability for an individual to work hard and build wealth; and spirited intellectual debate. This is how western civilization became the most prosperous that history has ever seen. Now people know they’re getting screwed. and they are.  They just don’t know why. They have no idea how central bankers who conjure money out of thin air have rigged the entire economy against them. So they blame “capitalism” and naturally embrace its opposite socialism.

Get A Warrant: Federal Judge Throws Out Stingray evidence In Drug Case, at rt.com. This judge should be applauded for ruling in favor of our fourth amendment rights. We need to remain vigilant because you know the left will appeal this, and shop for a judge who is an enemy of the constitution.

Too Many Laws: Why Police Encounters Escalate, by Ryan McMaken, at mises.org. If our politicians wouldn’t pass so many petty laws, the police, and citizens, wouldn’t cross paths as much.

Elon Musk Is The Face Of This Bubbling Stock Market, at zerohedge.com. Musk is building his empire with government (tax payer) subsidies.

Why Helicopter Money Won’t Push Stocks Higher, by Charles Hugh Smith, at oftwominds.com. If production. increases wealth, consumption destroys it. By creating money out of thin air, money that does not represent corresponding production, you promote consumption. You destroy wealth. Consuming more than you produce can only go on for so long.

The Market Is True Democracy, by Matthew McCaffery, at mises.org. Quote from Ludwig von Mises: “It would be more correct to say that a democratic constitution is a scheme to assign to the citizens in the conduct of government the same supremacy the market economy gives them in their capacity as consumers. However, the comparison is imperfect. In the political democracy only the votes cast for the majority candidate or the majority plan are effective in shaping the course of affairs. The votes polled by the minority do not directly influence politics. But on the market no vote is cast in vain. Every penny spent has the power to work upon the production processes.

Technology Is Amazing. Meet Farmbot.

 

Some Cartoons from the burningplatform.com.

Political Cartoons by Chip Bok

Political Cartoons by Glenn McCoy

 

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Here Is Some Econ. Homework

March 22, 2016

When knowledge is allowed to flow unhampered through the market, mainly through the price system, it works to coordinate all activities as optimally as possible. But when Government interventions don’t allow this knowledge to flow freely, malinvestments and dislocations are the result. The only way to cure these problems is for the interventions to stop. This allows the market to purge itself of these wasteful activities via a recession. Unfortunately no politician, bureaucrat, or Fed policy maker wants to have this correction happen on his watch.

Even tough hampered markets have an appearance of sustainability, they ultimately succumb to economic forces.

Here are two articles that talk about hampered markets. The first article is titled, Mises Was Right: The Hampered Market Is Unsustainable, by Sandy Ikeda, at mises,ca. Here are some excerpts from the article:

“Regulatory Dynamics Are Worse Than Transfer Dynamics. This is all because of the central role that prices play in coordinating market processes. That means that the government’s attempt to execute macroeconomic policy by manipulating the quantity of money and credit is perhaps the worst aspect of regulatory capitalism. Monetary manipulation eventually impacts all market prices directly and severely. Other things equal, it is the most distortionary form of intervention.”

“We can rank the major categories of intervention in order of their distortionary effects and thus in order of their unsustainability: 1) Large-scale monetary manipulation, 2) Large-scale price control, 3) Large-scale income redistribution.”

“So, other things equal, a country that pursues a pure form of welfare state capitalism might last longer than a country that pursues a pure form of regulatory state capitalism……”

“……Every country that has attempted interventionism in the past 100 years or so has experienced repeated economic crises. In Russia, crisis led to the Bolshevik Revolution and later the collapse of the Soviet Union. In Germany, the failure of the Weimar Republic conditioned the rise of National Socialism and then later the “economic miracle” under Ludwig Erhard. And in the United States, regulation and monetary manipulation produced the Great Depression and, decades later, the so-called Great Recession of 2007–09, with the “Reagan Revolution” in between.”

Ludwig Erhard And The German Economic Miracle.

 

Here is the second article titled, We Live In A Time Of Piecemeal-Planning & Incremental Interventionism, by Richard Ebeling, at mises.ca. Here are some excerpts from the article:

“Wherever we turn we are confronted with politicians, political pundits, television talking heads, and editorial page commentators, all of whom offer an array of plans, programs, and projects that will solve the problems of the world – if only government is given the power and authority to remake society in the design proposed.”

“Even many of those who claim to be suspicious of “big government” and the Washington beltway powers-that-be, invariably offer their own versions of plans, programs, and projects they assert are compatible with or complementary to a free society.”

“The differences too often boil down simply to matters of how the proposer wants to use government to remake or modify people and society. The idea that people should or could be left alnoe to design, undertake and manage their own plans and interactions with others is sometimes given lip service, but never entirely advocated or proposed in practice.”

“In this sense, all those participating in contemporary politics are advocates of social engineering, that is, the modifying or remaking of part or all of society according to an imposed plan or set of plans.”

“The idea that such an approach to social matters is inconsistent with both individual liberty and any proper functioning of a free society is beyond the pale of political and policy discourse. We live in a time of piecemeal planning and incremental interventionism.

“Society is a spontaneous order not a planned one.”

“Hayek argued that the true individualism starts from the premise that “society” is not some ethereal entity having an existence of its own, nor the designed creation of one or a handful of minds imposing a “plan” on people that produces the social order.”

“Instead, society is the cumulative and interactive outcome and result of multitudes of individual human beings making their separate individual plans that interact and generate connections and associations with other individual plans to produce the overall social order and its coordinated patterns.

 

If you really want to do some home work, read The Use Of Knowledge In Society, by F. A. Hayek at mises.org.

Related ArticleSpontaneous Order = Free Market Economy, at austrianaddict.com.

Related ArticleCentral Planners Hate Economics, at austrianaddict.com.

Related ArticleCharles Hugh Smith; Why Suppressing Feedback Leads To Financial Crisis, at austrianaddict.com.

Must Reads For The Week 1/9/16

January 9, 2016

GOVERNMENT COUNTERFEITING, ALTHOUGH LEGAL, IS STILL THEFT

Keynesian Economics 101, (In Four Simple Lessons), at zerohedge.com. Print and spend money to stimulate the economy.

The Government Must Stop Printing Phoney Money, by Richard Ebeling, at epictimes.com. This is an in-depth article about the Government electronically printing counterfeit money. Trying to take away the States monopoly on money printing through the political process is a daunting task. Put your thinking cap on for this one.

The Rise Of Independent (non-state) Crypto-Currencies, by Charles Hugh Smith, at oftwominds.com. This is how the States money printing monopoly will be taken down. When I first heard of Bitcoin, my first thought was Bitcoin, or some other crypto-currency, could lead to money being restored as a product of the free market. The States monopoly of money printing could be broken just like the taxi cartels monopoly was broken by an app on a phone (Uber).

Are We Headed For Another Bust?, by Frank Shostak, at mises.org. The Feds intervention in the free market by its policy of below market interest rates and electronically printing counterfeit money will eventually be corrected by economic forces that are always in play. The bust is correcting the Fed induced boom.

GRAB YOUR GUNS!

The Constitution, The President, And Guns, by Andrew P. Nepolitano, at creators.com. The opposition party hasn’t stood up to the power grabs by our President over the last 7 years. Why would anyone think the Presidents last year in office won’t be like the last 7 years on steroids?

Obama’s Gun Control Order: Dictatorial And It Won’t Work, by John Lott, at nationalreview.com. I’d have more respect for the President if he would just come out and say he wants to repeal the second amendment.

Chart Of The Day: More Guns Less Gun Violence Between 1993 And 2013, by Mark J. Perry, at carpediemblog. Data shows that gun violence has gone down as firearm ownership has increased. Causation or correlation?

Showman And Chief, by Thomas Sowell, at jewishworldreview.com. Thomas Sowell looks at the political theater of the Presidents press conference concerning gun control.

President Obama Tears Up While Discussing His Action To Curb Gun Violence. If you read the article by Thomas Sowell above: you have to ask yourself if the tears are real or just part of the show?

Just remember the Presidents standard operating proceedure: “You Never Let A Serious Crisis Go To Waste“.

JUST FOR LAUGHS

Hillary Can’t Explain The Difference Between Democrats And Socialists.

Let me see if I can help. A Democrat is a socialist who won’t admit it. She said she’s a “progressive” Democrat. A progressive Democrat, or a progressive Republican, is socialist central planner.

Dexter Manley Has Some Thoughts About Black Quarterbacks.

A couple of observations.  1) Watch the white guy in the video. He knows this is funny but he tries to hide his laughter by putting his head down. 2) Dexter Manley apologized for saying this. Are we so worried about offending people that we can’t even make jokes about ourselves or laugh at jokes like these. Isn’t it about time to drive a stake through the heart of political correctness?

 

 

 

 

 

How Money Disappears In A Fractional-Reserve Money System. By Frank Shostak

December 4, 2015

In this article from mises.org titled How Money Disappears In A Fractional-Reserve Money System, Frank Shostak does his usual brilliant job in explaining complex concepts. He covers the difference between real savings vs. savings created out of thin air via the electronic printing press, and how Fractional-Reserve banking increases the money supply. Here are some excerpts.

“Most experts are of the view that the massive monetary pumping by the US central bank during the 2008 financial crisis saved the US and the world from another Great Depression. On this the Federal Reserve Chairman at the time Ben Bernanke is considered the man that saved the world. Bernanke in turn attributes his actions to the writings of Professor Milton Friedman who blamed the Federal Reserve for causing the Great Depression of 1930s by allowing the money supply to plunge by over 30 percent.”

“Careful analysis will however show that it is not a collapse in the money stock that sets in motion an economic slump as such, but rather the prior monetary pumping that undermines the pool of real funding that leads to an economic depression.

Improving The Economy Requires Time And Savings

“Essentially, the pool of real funding is the quantity of consumer goods available in an economy to support future production. In the simplest of terms: a lone man on an island is able to pick twenty-five apples an hour. With the aid of a picking tool, he is able to raise his output to fifty apples an hour. Making the tool, (adding a stage of production) however, takes time.”

“During the time he is busy making the tool, the man will not be able to pick any apples. In order to have the tool, therefore, the man must first have enough apples to sustain himself while he is busy making it. His pool of funding is his means of sustenance for this period—the quantity of apples he has saved for this purpose.”

“The size of this pool determines whether or not a more sophisticated means of production can be introduced. If it requires one year of work for the man to build this tool, but he has only enough apples saved to sustain him for one month, then the tool will not be built—and the man will not be able to increase his productivity.”

“The island scenario is complicated by the introduction of multiple individuals who trade with each other and use money. The essence, however, remains the same: the size of the pool of funding sets a brake on the implementation of more productive stages of production.

When Banks Create the Illusion of More Wealth

“Trouble erupts whenever the banking system makes it appear that the pool of real funding is larger than it is in reality. When a central bank expands the money stock, it does not enlarge the pool of funding. It gives rise to the consumption of goods, which is not preceded by production. It leads to less means of sustenance.

(Read this article; Real Savings = True Credit. Printed Savings = False Credit, to get more analysis from Frank Shostak concerning real vs. printed savings.)

The existence of the central bank and fractional reserve banking permits commercial banks to generate credit, which is not backed up by real funding (i.e., it is credit created out of “thin air”).”

“Once the unbacked credit is generated it creates activities that the free market would never approve. That is, these activities are consuming and not producing real wealth.

“It is those non-wealth generating activities that end up having the most difficulties in serving their debt since these activities were never generating any real wealth and were really supported or funded, so to speak, by genuine wealth generators. (Money out of “thin air” sets in motion an exchange of nothing for something — the transferring of real wealth from wealth generators to various false activities.) With the fall in money out of thin air their support is cut-off.”

“Contrary to the popular view then, a fall in the money supply (i.e., money out of “thin air”), is precisely what is needed to set in motion the build-up of real wealth and a revitalizing of the economy.”

Printing money only inflicts more damage and therefore should never be considered as a means to help the economy. Also, even if the central bank were to be successful in preventing a fall in the money supply, this would not be able to prevent an economic slump if the pool of real funding is falling.”

Related Article Interest Rates Set By The Market vs. Interest Rates Set By The Federal Reserve, at austrianaddict.com.

Related ArticleThe Fed Has Proved The Lefts Trickle Down Straw Man Doesn’t Work, at austrianaddict.com.

Must Read “Leftovers”

September 1, 2015

Why The Federal Government Fails, by Chris Edwards, at cato.org. This short article gives five reasons why Government fails. But like a lot of things, judging success and failure depends on the perspective of the person doing the judging. President Obama thought Obamacare was a success for the simple fact that it got passed. I think Obamacare was a failure because the cost of my insurance has risen 40%. Of course I am just an evil person looking after my own self-interest, and the President is just a humble public servant who would never consider his self-interest when making decrees from on high.

Obama: Earning Contempt, at Home and Abroad, by Victor Davis Hanson, at victorhanson.com. If I misread human nature and cultural differences not many people are affected and the clean up has a low-cost. But a misread at the national level affects millions and the clean up has a high cost if it can be cleaned up at all. Could the recipients of Obama’s outreach and deference see this as weakness and worthy of contempt?  “…is naive appeasement more dangerous than wise deterrence, or …. does keeping quiet and carrying a large stick trump sounding off while wielding a toothpick.” Does appeasing a bully or a child, who is a brat, work? It depends on how you define work.

Jim Grant: The Fed Has Turned The Stock Market Into A Hall Of Mirriors, at reasontv.

Sorry Mr. Trump, Canadian Healthcare Is Not Working, at fraserinstitute.org. Excerpt from the article, “Canada suffers from a high-cost healthcare system that delivers only modest performance across most measures of health care. Put simply, Canada’s model of health care delivery and financing is not something to be emulated but rather avoided.”

Venezuela Is Adding More Zeroes To Its Currency To Deal With Hyperinflation, at bloomberg.com. Increasing the money supply is the definition of inflation. Today we think that rising prices is inflation. Rising prices can be caused by many things one of which is increasing {inflating} the money supply {inflation}. The cure for inflation {increasing the money supply} is not increasing the money supply.