I'm trying to stick up for Dr Paul in some other forums and I'm being attacked by some economist guy....HELP! How should I respond?
I wrote....
Yes but collapse is inevitable when you continually inflate the currency. As you create more fiat currency you are pulling wealth away from the dollars that already exist. That is stealing.
Response...
The expansion of the money supply is entirely necessary to support economic growth. Are you proposing that the money supply remain fixed so that as productivity and the economy expands, prices decline due to the lack of money, ultimately leading to a crash? As it is, the US money supply, M3, has only expanded by 10% of GDP since President Nixon ended the Gold exchange system in 1972. The anti-monetary system brigade would have us believe that the US money supply is growing at an exponential rate. In any event, only about 13% (currency and demand deposits) of the US money supply is exposed to inflation. The rest is interest bearing, and in line with the Fisher effect, compensation for the erosion of purchasing power from inflation is received. So your hypothesis that the current monetary system is designed to steal money from the masses is largely illusionary.
I wrote....
The people who get to use the money first before it filters into the system, like big business, military-industrial complex etc, get the most benefit.
Response...
I'm quite sure you can't even explain exactly what you mean by this statement.
I wrote....
Yes but collapse is inevitable when you continually inflate the currency. As you create more fiat currency you are pulling wealth away from the dollars that already exist. That is stealing.
Response...
The expansion of the money supply is entirely necessary to support economic growth. Are you proposing that the money supply remain fixed so that as productivity and the economy expands, prices decline due to the lack of money, ultimately leading to a crash? As it is, the US money supply, M3, has only expanded by 10% of GDP since President Nixon ended the Gold exchange system in 1972. The anti-monetary system brigade would have us believe that the US money supply is growing at an exponential rate. In any event, only about 13% (currency and demand deposits) of the US money supply is exposed to inflation. The rest is interest bearing, and in line with the Fisher effect, compensation for the erosion of purchasing power from inflation is received. So your hypothesis that the current monetary system is designed to steal money from the masses is largely illusionary.
I wrote....
The people who get to use the money first before it filters into the system, like big business, military-industrial complex etc, get the most benefit.
Response...
I'm quite sure you can't even explain exactly what you mean by this statement.
