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The Economic Crisis
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The two proposed solution, as far as I understand it, to America's unemployment, and correct me if I am wrong, seems to be:

a) Stimulate the Economy by printing and throwing as much money as possible at the economy, and hope that, by increasing the amount of money avaliable, people will purchase, creating demand, and thus creating jobs to supply those demands. Because America is so patriotic that people only buy American, even when faced with cheaper Indian, Vietnamese, or Chinese products. This is the policy, I think, our judicious leaders have taken.

b) Let the market regulate itself, because workers will, when faced with unemployment, accept lower wages, and companies will hire them all, even if there is no demand for their product, and we are restored to that happy and blissful seat- in short, it is the best of all possible worlds, and everything lines to create the best of all possible endings.

What do you think is the right policy our nation should take in such a crisis as this?
Posted 9/4/11 , edited 9/4/11

longfenglim wrote:



What do you think is the right policy our nation should take in such a crisis as this?
I say neither, because those policies were historically corrosive/flawed, by their own design specifications known as exponential growth which leads to compounding. When none of them consider what science knows about human motivation, or the absolute foolishness of an nonredeemable, abusive, and fiat-based monetary system.

Instead, a resource/energy based economic system of altruism is what a complex society needs to sustain itself within nature. Which nature itself can be seen as an interdependently diverse/complex, yet closed-loop system. Because otherwise the political alternatives only further cement the corporate narrative/practice of perception management from cradle to grave. And not "Free Market" self-regulation because there never was one, when in reality it's only the hyperinflation/asset bubbles based on our pattern of self-deception.
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Posted 9/4/11

longfenglim wrote:

The two proposed solution, as far as I understand it, to America's unemployment, and correct me if I am wrong, seems to be:

a) Stimulate the Economy by printing and throwing as much money as possible at the economy, and hope that, by increasing the amount of money avaliable, people will purchase, creating demand, and thus creating jobs to supply those demands. Because America is so patriotic that people only buy American, even when faced with cheaper Indian, Vietnamese, or Chinese products. This is the policy, I think, our judicious leaders have taken.

b) Let the market regulate itself, because workers will, when faced with unemployment, accept lower wages, and companies will hire them all, even if there is no demand for their product, and we are restored to that happy and blissful seat- in short, it is the best of all possible worlds, and everything lines to create the best of all possible endings.

What do you think is the right policy our nation should take in such a crisis as this?


A. would lead to inflation, last thing we need is for the price of meat to go from 5.99$ To 9.99$. this will force more people out of work....not fix anything. B. woulld be a better choice of the twobut there is better choices. 1 being the removal of most goverment programs the cost the tax payers... next would be to invest in companies that can make money through trade with other countries. As A scientist i will point out inclosed systems fail. the same goes for communities and governments.
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Posted 9/5/11 , edited 9/5/11

Darkphoenix3450 wrote:



A. would lead to inflation, last thing we need is for the price of meat to go from 5.99$ To 9.99$. this will force more people out of work....not fix anything. B. woulld be a better choice of the twobut there is better choices. 1 being the removal of most goverment programs the cost the tax payers... next would be to invest in companies that can make money through trade with other countries. As A scientist i will point out inclosed systems fail. the same goes for communities and governments.


Have you not heard of the magical Phillip's curve?



During the late fifties, British economist A.W. Phillips empirically stumbled upon an inverse relationship between unemployment and wages after plotting the figure on a graph. Economist soon realise that this relationship could be found everywhere, and soon, they connected that with inflation and a nifty explaination- as employment rise, the strenght of the labourers is greater, thus, they can raise wages. But the employers realising that this would make them less profit, would raise prices, and the workers, again, realising that this would in fact make their new gain in higher wages not really exist (if prices go up, and wage goes up in the same proportion, there is no gain) if this happens, so they go back to the table, &c. and soon, this will lead to inflation. Likewise, when there is unemployment, deflation occurs because, there being less workers, the workers are willing to work for lower wages, prices will drop, and deflation occurs. Thus, it falls to reason that there is a trade-off between inflation and employment- at least in the short term. The solution is then is to create short term inflation to stimulate the economy, create employment, &c. &c. By creating more money, the people would have more spending power, which will lead to greater purchase, and more demand. So, in effect, the government, in respect to their recent Stimulus and their printing of money, have giant lump of bronze, and they hope that it will seperate itself into copper and tin. Of course, I am no economist, and my explanation may be completely incorrect.
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Posted 9/5/11

DomFortress wrote:


longfenglim wrote:



What do you think is the right policy our nation should take in such a crisis as this?
I say neither, because those policies were historically corrosive/flawed, by their own design specifications known as exponential growth which leads to compounding. When none of them consider what science knows about human motivation, or the absolute foolishness of an nonredeemable, abusive, and fiat-based monetary system.

Instead, a resource/energy based economic system of altruism is what a complex society needs to sustain itself within nature. Which nature itself can be seen as an interdependently diverse/complex, yet closed-loop system. Because otherwise the political alternatives only further cement the corporate narrative/practice of perception management from cradle to grave. And not "Free Market" self-regulation because there never was one, when in reality it's only the hyperinflation/asset bubbles based on our pattern of self-deception.


In effect, Socialism.

Posted 9/5/11 , edited 9/9/11

longfenglim wrote:



Have you not heard of the magical Phillip's curve?



During the late fifties, British economist A.W. Phillips empirically stumbled upon an inverse relationship between unemployment and wages after plotting the figure on a graph. Economist soon realise that this relationship could be found everywhere, and soon, they connected that with inflation and a nifty explaination- as employment rise, the strenght of the labourers is greater, thus, they can raise wages. But the employers realising that this would make them less profit, would raise prices, and the workers, again, realising that this would in fact make their new gain in higher wages not really exist (if prices go up, and wage goes up in the same proportion, there is no gain) if this happens, so they go back to the table, &c. and soon, this will lead to inflation. Likewise, when there is unemployment, deflation occurs because, there being less workers, the workers are willing to work for lower wages, prices will drop, and deflation occurs. Thus, it falls to reason that there is a trade-off between inflation and employment- at least in the short term. The solution is then is to create short term inflation to stimulate the economy, create employment, &c. &c. By creating more money, the people would have more spending power, which will lead to greater purchase, and more demand. So, in effect, the government, in respect to their recent Stimulus and their printing of money, have giant lump of bronze, and they hope that it will seperate itself into copper and tin. Of course, I am no economist, and my explanation may be completely incorrect.
There's at least two problems with that "creating more money" process, when a fiat currency like the US Dollars is made of debt: one is the real physical limitation of our planet's carrying capacity simply cannot sustain an infinite growth.

These monetary learnings allow us to formulate two more extremely important Key Concepts.

The first is that all dollars are backed by debt. At the local bank level, all new money is loaned into existence. At the Federal Reserve level, money is simply manufactured out of thin air and then exchanged for interest-paying government debt. In both cases, the money is backed by debt. Debt that pays interest. From this Key Concept, we can formulate a truly profound statement, which is that at a minimum, each year enough new money must be loaned into existence to cover the interest payments on all of the past outstanding debt.

If we flip this slightly, we can say that each year all the outstanding debt must compound by at least the rate of the interest on that debt. Each and every year it must grow by some percentage. Because our debt-based money system is growing by some percentage continually, it is an exponential system by its very design. A corollary of this is that the amount of debt in the system will always exceed the amount of money.

I am not going to cast judgment on this and say that it is good or it is bad. It simply is what it is. By understanding its design, though, you will be better equipped to understand that the potential range of future outcomes for our economy are not limitless, but rather bounded by the rules of the system.

All of which leads us to the fourth Key Concept, which is that perpetual expansion is a requirement of modern banking. In fact we can make a rule: Each year, new credit (loans) must be made that at least equal the amount of all the outstanding interest payments that year. Without a continuous expansion of the money supply, past debts would not be able to be serviced, and defaults would ripple through, and possibly destroy, the entire system. Defaults are the Achilles heel of a debt-based money system, which we saw in our local banking example in the previous chapter. Because of this, all the institutional and political forces in our society are geared towards avoiding this outcome.

So the banking system must continually expand – not necessarily because it is the right (or wrong) thing to do, but, rather, simply because that is how it was designed. It is a feature of the system, just like using gasoline is a feature of my car’s engine. I might wish and hope that my car would run on straw, but I’d be wasting my time, because that’s just not how it was designed.

By understanding the requirement for continual expansion, we will be in a better position to make informed decisions about what’s likely to transpire and take meaningful actions to enhance our prospects.

More philosophically, we might wonder about the long-term viability of a system that must expand exponentially but which exists on a spherical planet. The key question is, “Can our current money system somehow be modified to be stable, fair, and useful when it is not growing?”

So the question is this: What happens when a human-contrived money system that must expand, by its very design, runs headlong into the physical limits of a spherical planet?(citation)
And two is the historical destruction of the currency itself due to hyperinflation.

It is crucially important that a nation’s money supply is carefully managed, for if it is not, the monetary unit can be destroyed by inflation. In fact, there are over 3,800 past examples of paper currencies that no longer exist. There are numerous examples from the United States, which may have some collector value but no longer possess any monetary value. Of course, I could just as easily display beautiful but no longer functional examples from Argentina, Bolivia, and Columbia, and a hundred other places

How does a hyperinflationary destruction of a currency happen?

Here’s a relatively recent example that comes from Yugoslavia between the years 1988 and 1995. Pre-1990, the Yugoslavian dinar had measurable value: You could actually buy something with one. However, throughout the 1980’s, the Yugoslavian government ran a persistent budget deficit and printed money to make up the shortfall. By the early 1990’s, the government had used up all its own hard currency reserves, and they proceeded to loot the private accounts of citizens. In order to keep things moving along, successively larger bills had to be printed, finally culminating in this stunning example – a 500 billion dinar note. At its height, inflation in Yugoslavia was running at over 37% per day. This means prices were doubling every 48 hours or so.

Let me see if I can make that more concrete for you. Suppose that on January 1, 2007, you had a penny and could find something to purchase with it. At 37% per day inflation, by April 3, 2007 you’d need one of these – a billion dollar bill – to purchase the very same item. In reverse, if you’d had a billion dollars on January 1st stuffed in a suitcase, by April 3rd you’d have had a penny’s worth of purchasing power left.

Clearly, if you’d attempted to save money during this period of time, you’d have lost it all, so we can safely state that inflationary money regimes impose a penalty on savers. The opposite side of this is that inflationary money regimes promote spending and require that money be invested or speculated, so as to at least have the chance of keeping pace with inflation. Of course, investing and speculating involve risks, so we can broaden this statement to include the claim that inflationary monetary systems require the citizens living within them to subject their hard-earned savings to risk.

That is worth pondering for a minute or two.

Even more importantly, since history shows how common it is for currencies to be mismanaged, we need to keep a careful eye on the stewards of our money to make sure they are not being irresponsible by creating too much money out of thin air and thereby destroying our savings, culture, and institutions by the process of inflation.(citation)

That's why a fiat currency is doomed to fail by its very design. And now with electronic payment system, hyperinflation can run its course without relying on printing large bills.

Jacob Goldstein: Because now, if you think of most of the money that you have, or most of the money that I have, it's never currency. I get paid. That is just a direct deposit from NPR, from my employer, to my checking account. It's not like they give me a bunch of hundred dollar bills every week. And then, I pay my bills online. So currency even now is like old-fashioned. You don't have to touch money. You don't have to see it. It's just information.Money is just an abstract and arbitrary made-belief, there's no intrinsic value in a fiat currency we use in the modern world.

Ira Glass: Until this conversation it never occurred to me that money doesn't change hands when we pay our bills online or anything. Like I don't know why I never even stopped to think, right, at no point does the bank go and deliver like $100 to the phone company on my behalf. It really is just numbers going back and forth in the computer.

Jacob Goldstein: Yeah. Nothing happens in the physical world. I mean I guess, except electrical pulses I guess it would be flying back and forth between computers. The money doesn't really exist. Not only is there no gold. There aren't even bills for most of the money that exists. Most of the money that exists is just the idea. It's just the bank saying, yes, there is this much money in your account.(citation)
So in conclusion, Money is just an abstract and arbitrary made-belief, there's no intrinsic value in a fiat currency we use in the modern world. But we're all made to believe that it's somehow important.


longfenglim wrote:


DomFortress wrote:


Instead, a resource/energy based economic system of altruism is what a complex society needs to sustain itself within nature. Which nature itself can be seen as an interdependently diverse/complex, yet closed-loop system. Because otherwise the political alternatives only further cement the corporate narrative/practice of perception management from cradle to grave. And not "Free Market" self-regulation because there never was one, when in reality it's only the hyperinflation/asset bubbles based on our pattern of self-deception.


In effect, Socialism.
If only people would just see through the entertainment buzz, without themselves being indoctrinated into believing that it's somehow a dirty word. Then hopefully they would realize for themselves that socialism is about establishing an egalitarian society.
Posted 9/8/11 , edited 9/8/11
Oh come on. We all know that a lot of this is just going to lead to further outsourcing.
Posted 9/8/11

DeusExMachine wrote:

Oh come on. We all know that a lot of this is just going to lead to further outsourcing.
Is it "outsourcing" or just a part of globalization? Keep in mind that nation states are merely arbitrary human concepts, when there's only one Earth hosting a complex and diverse biosphere.
Posted 9/9/11

DomFortress wrote:


DeusExMachine wrote:

Oh come on. We all know that a lot of this is just going to lead to further outsourcing.
Is it "outsourcing" or just a part of globalization? Keep in mind that nation states are merely arbitrary human concepts, when there's only one Earth hosting a complex and diverse biosphere.


I can see it that way, yet our differences still separate us into nations with special ways of conducting business.
Posted 9/9/11 , edited 9/11/11

DeusExMachine wrote:


DomFortress wrote:


DeusExMachine wrote:

Oh come on. We all know that a lot of this is just going to lead to further outsourcing.
Is it "outsourcing" or just a part of globalization? Keep in mind that nation states are merely arbitrary human concepts, when there's only one Earth hosting a complex and diverse biosphere.


I can see it that way, yet our differences still separate us into nations with special ways of conducting business.
Merely differences within cultural contexts/legacies, when cultures themselves are arbitrary and thereby subject to change.

The Industrial Age left us with a terrible cultural legacy some have labeled the “allies” model of company culture. It was supposed to be the most evolved, but it doesn’t work.

Here’s six views of “employees” that are common in local (and giant) businesses. See which one is yours:

Employee as enemy – all processes are set up to box them in and treat them like prisoners/numbers. Inmates, I mean employees, are to be mistrusted on the way in.

Hired hand – a necessary evil; we give away tasks to them reluctantly, even though nobody can do it as well as me. We never want them to think, just do tasks.

We are family – the parent/child approach – good luck with that! Do you really want more kids? Some business owners apparently do.

Friends – everyone is on a level plane. Everyone is in charge of everything, therefore, nobody is in charge of anything – “we’re all friends here, right?” Anything with two heads belongs in a circus. Where does something belong with no head?

Allies – The dominant Industrial Age culture. The focus is on the task. Like England, Russia, France, and the U.S. in World War II, we don’t have to like each other; we just need to focus on the task at hand. This is the worst and most advanced form of Industrial Age thinking. Most companies still live here. Let’s just hire for skills. Culture is woo-woo crap.

Business as COMMUNITY – The great companies are already doing this. They believe strongly in why they exist, what they are doing here and where they are going. And they don’t hire people who don’t want the same things. Committed Community is the basis for getting the task done in the new company.

Community has hierarchy – somebody is in charge. But it emphasizes collaboration and true “team” – using agreed upon methodologies to achieve an agreed upon goal. Community imputes trust and creates an environment where everyone is encouraged to take ownership and make a contribution. Community members play clearly defined roles as part of a team, not behind cube walls.

Hire for culture. You can teach anybody a skill, but if they don’t believe in what you do, it’s a short-term gain with long-term pain.
(citation)

Moreover, here's how and why an economic stimulus based on sheer money(not jobs) creation stopped working, when Fed Crazytown simply had stopped balancing hyperinflation altogether.

Ira Glass: OK, but when the Fed loses money on some mall that it now owns, does that eventually in some sneaky back door way, come out of my taxes?

David Kestenbaum: No. Because first of all, it's not part of the government. Second of all, even if it were, every year the Fed makes a profit. The Fed never loses money. It can create money out of thin air from nowhere. It uses that to buy government bonds, things that pay interest. So it gets interest every year. And every year it makes a huge profit, like in 2009 at the height of the crisis, it made $47 billion.

Alex Blumberg: And that profit they always turn over to the federal government. So it actually reduces the deficit.

Ira Glass: And so all of this money that they've created since 2008, totaling it up if I understand right, it's over $1.6 trillion. Does this have anything to do with the TARP program to buy up toxic assets?

David Kestenbaum: No, that was the federal government.

Ira Glass: Does it have anything to do with Obama's stimulus package.

David Kestenbaum: No, federal government.

Ira Glass: But this $1.6 trillion is bigger than both of those combined. We have these huge fights that drag on for weeks over the stimulus package and over these other things, and then the Fed does something that dwarfs these in size. It's twice as big as either of those programs. And there's no discussion. The Congress doesn't debate it. The president doesn't approve it. There's no public input. Some eggheads in a room just kind of wave a wand and then it just happens?

David Kestenbaum: Yep. That's the idea of a central bank.

Ira Glass: OK, is that a good thing?

Alex Blumberg: It depends who you talk to. Most economists would say, thank God the Fed did this. Thank God the Fed used its super power to create money out of thin air and lent that money to Harley Davidson and Goldman Sachs, and you and me to buy houses, and Bear Stearns in exchange for that mall in Oklahoma. Doing all that crazy crap, that kept us out of soup lines.

David Kestenbaum: And the Chairman of the Federal Reserve, Ben Bernanke, says that because of the Fed's actions, quote, "The world was spared a cataclysm that could have rivaled or surpassed the Great Depression." And Bernanke is actually one of the leading scholars on the economics of the Great Depression. And he says, in fact, that the Great Depression happened in large part because the Fed back then wasn't crazy enough. Or as he put it, they were quote, "Insufficiently willing to challenge the orthodoxies of their day."(citation)

And remember just how hyperinflation of every fiat currency could eventually destroy the financial system as a whole, by rendering people's assets and savings practically worthless throughout the history of market? Well it's no different in the job market, where people's skills and ideas are becoming worthless. Due to the fact that whatever government incentives for business to save by hiring, is being undermined by hyperinflation through the central bank.

Perhaps the most intractable problem facing the economy right now is the plight of the long-term unemployed. More than six million people have been searching for jobs for six months or longer. But with the growing stigma that employees attach to this group of people, the president’s proposal to give employers $4,000 tax credits for hiring the long-term unemployed is likely to be a hard sell among companies.

Jen-Hsun Huang, the chief executive of the chip maker Nvidia, a Santa Clara, Calif., designer of chips for smartphones and tablets, said that because of growth in those markets, the company, which currently employs about 5,000 of its 7,000 global workers in the United States, expects to add about 20 percent more people within the next year.

But he said the incentives would not influence the company’s hiring decisions. “The people we hire tend not to be out of work for six months,” said Mr. Huang. Instead, he said, the company recruits recent graduates from the country’s top engineering schools. “The guys we hire are like sports stars,” he said.

Lucious Plant, work force development administrator in Montgomery County, Ohio, where Dayton is the county seat, said companies were shortsighted for viewing people who had been out of work for several months as somehow inferior. Given today’s economy, he said, it was common for those who lost their jobs to stay unemployed for six months or more, and that many of those workers were highly skilled.

“I think it would be very easy to have six months of unemployment and still be a top candidate,” Mr. Plant said.

But more people needing work than the current business climate warrants.

“If I get a $4,000 benefit for hiring you and I pay you $80,000 and you’re going to sit at your desk and do nothing because there’s nothing to do,” said Marty Regalia, chief economist of the United States Chamber of Commerce, “then the businesses aren’t going to hire you.”(citation)
Posted 9/11/11


A sad truth, but if we are to continue through this wonderful miasma called life, then continuously expanding our economy beyond even out own biosphere's capacity must see an end. We can't squeeze blood from turnips much longer than we have been.
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Posted 9/13/11 , edited 9/13/11

DomFortress wrote:


longfenglim wrote:



Have you not heard of the magical Phillip's curve?



During the late fifties, British economist A.W. Phillips empirically stumbled upon an inverse relationship between unemployment and wages after plotting the figure on a graph. Economist soon realise that this relationship could be found everywhere, and soon, they connected that with inflation and a nifty explaination- as employment rise, the strenght of the labourers is greater, thus, they can raise wages. But the employers realising that this would make them less profit, would raise prices, and the workers, again, realising that this would in fact make their new gain in higher wages not really exist (if prices go up, and wage goes up in the same proportion, there is no gain) if this happens, so they go back to the table, &c. and soon, this will lead to inflation. Likewise, when there is unemployment, deflation occurs because, there being less workers, the workers are willing to work for lower wages, prices will drop, and deflation occurs. Thus, it falls to reason that there is a trade-off between inflation and employment- at least in the short term. The solution is then is to create short term inflation to stimulate the economy, create employment, &c. &c. By creating more money, the people would have more spending power, which will lead to greater purchase, and more demand. So, in effect, the government, in respect to their recent Stimulus and their printing of money, have giant lump of bronze, and they hope that it will seperate itself into copper and tin. Of course, I am no economist, and my explanation may be completely incorrect.
There's at least two problems with that "creating more money" process, when a fiat currency like the US Dollars is made of debt: one is the real physical limitation of our planet's carrying capacity simply cannot sustain an infinite growth.

These monetary learnings allow us to formulate two more extremely important Key Concepts.

The first is that all dollars are backed by debt. At the local bank level, all new money is loaned into existence. At the Federal Reserve level, money is simply manufactured out of thin air and then exchanged for interest-paying government debt. In both cases, the money is backed by debt. Debt that pays interest. From this Key Concept, we can formulate a truly profound statement, which is that at a minimum, each year enough new money must be loaned into existence to cover the interest payments on all of the past outstanding debt.

If we flip this slightly, we can say that each year all the outstanding debt must compound by at least the rate of the interest on that debt. Each and every year it must grow by some percentage. Because our debt-based money system is growing by some percentage continually, it is an exponential system by its very design. A corollary of this is that the amount of debt in the system will always exceed the amount of money.

I am not going to cast judgment on this and say that it is good or it is bad. It simply is what it is. By understanding its design, though, you will be better equipped to understand that the potential range of future outcomes for our economy are not limitless, but rather bounded by the rules of the system.

All of which leads us to the fourth Key Concept, which is that perpetual expansion is a requirement of modern banking. In fact we can make a rule: Each year, new credit (loans) must be made that at least equal the amount of all the outstanding interest payments that year. Without a continuous expansion of the money supply, past debts would not be able to be serviced, and defaults would ripple through, and possibly destroy, the entire system. Defaults are the Achilles heel of a debt-based money system, which we saw in our local banking example in the previous chapter. Because of this, all the institutional and political forces in our society are geared towards avoiding this outcome.

So the banking system must continually expand – not necessarily because it is the right (or wrong) thing to do, but, rather, simply because that is how it was designed. It is a feature of the system, just like using gasoline is a feature of my car’s engine. I might wish and hope that my car would run on straw, but I’d be wasting my time, because that’s just not how it was designed.

By understanding the requirement for continual expansion, we will be in a better position to make informed decisions about what’s likely to transpire and take meaningful actions to enhance our prospects.

More philosophically, we might wonder about the long-term viability of a system that must expand exponentially but which exists on a spherical planet. The key question is, “Can our current money system somehow be modified to be stable, fair, and useful when it is not growing?”

So the question is this: What happens when a human-contrived money system that must expand, by its very design, runs headlong into the physical limits of a spherical planet?(citation)
And two is the historical destruction of the currency itself due to hyperinflation.

It is crucially important that a nation’s money supply is carefully managed, for if it is not, the monetary unit can be destroyed by inflation. In fact, there are over 3,800 past examples of paper currencies that no longer exist. There are numerous examples from the United States, which may have some collector value but no longer possess any monetary value. Of course, I could just as easily display beautiful but no longer functional examples from Argentina, Bolivia, and Columbia, and a hundred other places

How does a hyperinflationary destruction of a currency happen?

Here’s a relatively recent example that comes from Yugoslavia between the years 1988 and 1995. Pre-1990, the Yugoslavian dinar had measurable value: You could actually buy something with one. However, throughout the 1980’s, the Yugoslavian government ran a persistent budget deficit and printed money to make up the shortfall. By the early 1990’s, the government had used up all its own hard currency reserves, and they proceeded to loot the private accounts of citizens. In order to keep things moving along, successively larger bills had to be printed, finally culminating in this stunning example – a 500 billion dinar note. At its height, inflation in Yugoslavia was running at over 37% per day. This means prices were doubling every 48 hours or so.

Let me see if I can make that more concrete for you. Suppose that on January 1, 2007, you had a penny and could find something to purchase with it. At 37% per day inflation, by April 3, 2007 you’d need one of these – a billion dollar bill – to purchase the very same item. In reverse, if you’d had a billion dollars on January 1st stuffed in a suitcase, by April 3rd you’d have had a penny’s worth of purchasing power left.

Clearly, if you’d attempted to save money during this period of time, you’d have lost it all, so we can safely state that inflationary money regimes impose a penalty on savers. The opposite side of this is that inflationary money regimes promote spending and require that money be invested or speculated, so as to at least have the chance of keeping pace with inflation. Of course, investing and speculating involve risks, so we can broaden this statement to include the claim that inflationary monetary systems require the citizens living within them to subject their hard-earned savings to risk.

That is worth pondering for a minute or two.

Even more importantly, since history shows how common it is for currencies to be mismanaged, we need to keep a careful eye on the stewards of our money to make sure they are not being irresponsible by creating too much money out of thin air and thereby destroying our savings, culture, and institutions by the process of inflation.(citation)

That's why a fiat currency is doomed to fail by its very design. And now with electronic payment system, hyperinflation can run its course without relying on printing large bills.

Jacob Goldstein: Because now, if you think of most of the money that you have, or most of the money that I have, it's never currency. I get paid. That is just a direct deposit from NPR, from my employer, to my checking account. It's not like they give me a bunch of hundred dollar bills every week. And then, I pay my bills online. So currency even now is like old-fashioned. You don't have to touch money. You don't have to see it. It's just information.Money is just an abstract and arbitrary made-belief, there's no intrinsic value in a fiat currency we use in the modern world.

Ira Glass: Until this conversation it never occurred to me that money doesn't change hands when we pay our bills online or anything. Like I don't know why I never even stopped to think, right, at no point does the bank go and deliver like $100 to the phone company on my behalf. It really is just numbers going back and forth in the computer.

Jacob Goldstein: Yeah. Nothing happens in the physical world. I mean I guess, except electrical pulses I guess it would be flying back and forth between computers. The money doesn't really exist. Not only is there no gold. There aren't even bills for most of the money that exists. Most of the money that exists is just the idea. It's just the bank saying, yes, there is this much money in your account.(citation)
So in conclusion, Money is just an abstract and arbitrary made-belief, there's no intrinsic value in a fiat currency we use in the modern world. But we're all made to believe that it's somehow important.


longfenglim wrote:


DomFortress wrote:


Instead, a resource/energy based economic system of altruism is what a complex society needs to sustain itself within nature. Which nature itself can be seen as an interdependently diverse/complex, yet closed-loop system. Because otherwise the political alternatives only further cement the corporate narrative/practice of perception management from cradle to grave. And not "Free Market" self-regulation because there never was one, when in reality it's only the hyperinflation/asset bubbles based on our pattern of self-deception.


In effect, Socialism.
If only people would just see through the entertainment buzz, without themselves being indoctrinated into believing that it's somehow a dirty word. Then hopefully they would realize for themselves that socialism is about establishing an egalitarian society.


So, you would rather us go back to the Gold Standard or to a Commidity Currency system instead of our current Fiat system? I am not quite sure that getting rid of the Fiat Currency, which is simply money which the Government insures is legal tender, would be all that beneficial, being that Gold back currency would deflate the dollar to the point where, while it is worth much more, it is less competitive than- say- every other Fiat currency in the world, that is, every other currency in the world. Let us say we go back to backing our money with Gold, say, at the Bretton-Woods' 35 dollar for every ounce, Gold is, as of today, worth at around 1800$. That would make a single of our hypothetical dollar worth around 50 of our current dollar, and a single hypothetical cent worth around fifty cents. And, because there is only a limited supply of Gold in our Goverment treasury, Money becomes even more scarce. I do not think that massive deflation is the way to go. We may as well go back to the Pound, divide that into crowns, half-crowns, shillings, sixpence, thrupence, tuppence, penny, ha'penny, fathings, half-farthings and, if that is not enough, quarter-farthings if we do.
Posted 9/14/11

longfenglim wrote:



So, you would rather us go back to the Gold Standard or to a Commidity Currency system instead of our current Fiat system? I am not quite sure that getting rid of the Fiat Currency, which is simply money which the Government insures is legal tender, would be all that beneficial, being that Gold back currency would deflate the dollar to the point where, while it is worth much more, it is less competitive than- say- every other Fiat currency in the world, that is, every other currency in the world. Let us say we go back to backing our money with Gold, say, at the Bretton-Woods' 35 dollar for every ounce, Gold is, as of today, worth at around 1800$. That would make a single of our hypothetical dollar worth around 50 of our current dollar, and a single hypothetical cent worth around fifty cents. And, because there is only a limited supply of Gold in our Goverment treasury, Money becomes even more scarce. I do not think that massive deflation is the way to go. We may as well go back to the Pound, divide that into crowns, half-crowns, shillings, sixpence, thrupence, tuppence, penny, ha'penny, fathings, half-farthings and, if that is not enough, quarter-farthings if we do.
No. Not when all money become a useless and arbitrary bartering system in a resource/energy(not monetary) based economy. It can't measure electricity by watts, food by nutritional facts, civilization by prosperity, health and wellness by freedom from diseases, human flourishing by humanity, nor sustainability by bio diversity. It's a cultural legacy of no intrinsic usefulness or value within the context of nature.

A resource/energy based economic system of altruism is what a complex society needs to sustain itself within nature. Which nature itself can be seen as an interdependently diverse/complex, yet closed-loop system. Because otherwise the political alternatives only further cement the corporate narrative/practice of perception management from cradle to grave. And not "Free Market" self-regulation because there never was one, when in reality it's only the hyperinflation/asset bubbles based on our pattern of self-deception.
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Posted 9/14/11


So, you want to get rid of money in general, and replace that with the redistribution of energy and resources? That would have to be on an international level, because countries, in general, do not produce all of the resources it needs. Who will be the one to decide the most efficient distribution? The government? Let us assume the government is in charge of all this, and that we elect the government, who is to say that we should be able to trust them? Or that there is someone more qualified to resdistribute weath than ourselves? But, say it works, and that there is a egality in the distribution, then how would the system cope with this human disire known as 'want'? For example, how would it cope with the 'I want this, and he has it'? Obviously, we can have a system where we make everyone into selfless caring people, either by trying to eliminate the greed they have through Fun-Camps and Friendly-Land, and then everyone will all be happy nice people who give what they have to someone else who wants it, and that person would carefully accept and will be able to do the same if given the chance, which bascially amounts to brainwashing, or we could barter our tangible resources, for example, fifty bushel of wheat and a door-nail, in exchange for other tangible resources, say Milton's Paradise Lost and Hustler's magazine issue 205. That depends on the existence of Reciprocated and Mutual desire, with both parties desiring what the other has, for example, I may want Milton and Hustler, but the other fellow may not want wheat or door nails. That is why we have money, because it eliminates the need of mutual and reciprocated desire for transaction, money, either commidity based or fiat based, has the property of being able to procure objects, and has the property of procuring object- that is, it is valid now, and can be valid in the future- though, that also depends on the confidence in the money's ability. Most Socialist, including the most famous, Charles Henry Marx (an anglicisation of his name, you may well note), have been wise enough to induce the utility of money within any economic system dependant the human emotion known as 'desire', that is, almost all economic system. Even at the most primitive level, desire is the core of all economic transaction. Then, if this problem does not exist, then there is the problem of how to get there. Do we go there immediately, and rush to where angels dare not tread, or do we arrive there in graduations.
Posted 9/14/11

longfenglim wrote:



So, you want to get rid of money in general, and replace that with the redistribution of energy and resources? That would have to be on an international level, because countries, in general, do not produce all of the resources it needs. Who will be the one to decide the most efficient distribution? The government? Let us assume the government is in charge of all this, and that we elect the government, who is to say that we should be able to trust them? Or that there is someone more qualified to resdistribute weath than ourselves? But, say it works, and that there is a egality in the distribution, then how would the system cope with this human disire known as 'want'? For example, how would it cope with the 'I want this, and he has it'? Obviously, we can have a system where we make everyone into selfless caring people, either by trying to eliminate the greed they have through Fun-Camps and Friendly-Land, and then everyone will all be happy nice people who give what they have to someone else who wants it, and that person would carefully accept and will be able to do the same if given the chance, which bascially amounts to brainwashing, or we could barter our tangible resources, for example, fifty bushel of wheat and a door-nail, in exchange for other tangible resources, say Milton's Paradise Lost and Hustler's magazine issue 205. That depends on the existence of Reciprocated and Mutual desire, with both parties desiring what the other has, for example, I may want Milton and Hustler, but the other fellow may not want wheat or door nails. That is why we have money, because it eliminates the need of mutual and reciprocated desire for transaction, money, either commidity based or fiat based, has the property of being able to procure objects, and has the property of procuring object- that is, it is valid now, and can be valid in the future- though, that also depends on the confidence in the money's ability. Most Socialist, including the most famous, Charles Henry Marx (an anglicisation of his name, you may well note), have been wise enough to induce the utility of money within any economic system dependant the human emotion known as 'desire', that is, almost all economic system. Even at the most primitive level, desire is the core of all economic transaction. Then, if this problem does not exist, then there is the problem of how to get there. Do we go there immediately, and rush to where angels dare not tread, or do we arrive there in graduations.
Brainwashing? Well talk about your irony. When the fact is your false-positive superstition on mere "desire" as human nature, is but a naturalistic fallacy within the context of social psychology and neuroscience. When the fact is humans as social animals both desire and need the experience of belongingness, not mere material possession.

Belonging-ness as a Basic Need

Just as protein is needed in the diet for the health of the body, so belongingness is a basic need for the mind and soul. In the early years of the study of depth psychology, different innovators explored our “basic” motivations. Freud suggested sex and aggression as two key drives, Alfred Adler noted the seeking of the sense of superiority to counter inferiority feelings, and Jung noted a wide range of archetypal sources of motivation. Others also came up with their suggestions.

By the 1940s, though, child development research had considered another interesting disease that was prevalent again in orphanages, variously called "hospitalism," "anaclitic depression", or “marasmus," and describing the way some babies became sickly and often died! They traced this not to not being fed, but not being sufficiently cuddled, touched, played with! Other researchers supported the growing need for contact—and this in some ways was in contrast to a fashion in the child-rearing texts of the 1920s and 1930s to not pick up the crying child lest he be “spoiled.” (The success of the Doctor Spock books in the late 1940s was due to his challenging this anti-spoiling regiment. Benjamin Spock didn’t support “permissiveness” as his enemies accused, but simply not being harshly reserved.)

Psychoanalysts in the 1950s wove such research into revisions of theory, and while some stayed with Freud’s earlier “drive” theories, a fair number came to espouse what came to be called object relations theory. (This term refers to the object of a person’s love—and/or hate—, but many think of objects as inanimate, so the term is somewhat somewhat misleading; the theory itself seeks to highlight the intensity and depth of interpersonal relations.)

Much of object relations theory originally was based on observations about the interactions of infants and young children and their parents or caretakers, but what should be realized as that these early bonding experiences, with all their ups and downs, is only a small part of the richness of the dynamic! By age four to six, young children expand the scope of their worlds to include wider circles of friends, neighbors, and more abstract entities. Kids hear about and begin to root for the teams their parents root for, begin to relate to the family’s or communities myths about gods or spiritual entities, partake of ethnic identities, and feel patriotism and other sorts of loyalty. The term, belongingness, then, is more understandable and inclusive of our broader, more complex and life-long needs for feeling connected.(citation)

However, that human need for the experience of belongingness through social connection got highjacked by the psychotic corporate cultural practice of perception management from cradle to grave. AKA your "Fun-Camps" and "Friendly-Land" created by the corporations. When they basically socialized our children that in order for them to be worthy of belongingness, they need to possess their products, while compete in an arbitrary social hierarchy of vanity and shallowness.
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