Tired of RP Supporters' Economic BS

[Paul.Bearer.of.Injustice]

It would be really nice if you could find a way to answer my question without asking a question.

So back to the cow and bull. Why can't I ask for more back then the original cow and bull?


ps...when I run out of room, I kill the cow and bull and sell the meat, hide, and everything else.

You can ask for whatever you want. In our system, you have no competition since everyone will ask for around the same legal extortion limit set by Bernanke + bank service % fee. We either agree or die.
If there were real competition, our risk of being extorted would be less.

Moreover, your example isn't compounding a medium of exchange, you are compounding real assets, which is completely different. The things money is a substitute for may in certain cases follow a growth function, like the case of animal reproduction, but economic growth overall and most modes of production do not.

You just can't magically grow a money supply according to an asymptotic function and expect it to last. All this does is ensure at the end of the game all money is returned to the makers of the game.

 

[danberkeley]

You can ask for whatever you want. In our system, you have no competition since everyone will ask for around the same legal extortion limit set by Bernanke + bank service % fee. We either agree or die.
If there were real competition, our risk of being extorted would be less.

Moreover, your example isn't compounding a medium of exchange, you are compounding real assets, which is completely different. The things money is a substitute for may in certain cases follow a growth function, like the case of animal reproduction, but economic growth overall and most modes of production do not.

You just can't magically grow a money supply according to an asymptotic function and expect it to last. All this does is ensure at the end of the game all money is returned to the makers of the game.

Then again, us Astrians recognize that paper backed by nothing more than the paper itself has not much intrinsic value. It is hardly money and history has shown it to be a medium of exchange that does not last. Also, when we refer to money, we do not assume the US dollar but money as money itself... Legal extortion? LOL

 

[ARealConservative]

You can ask for whatever you want.

Great. so I can ask for compound interest, which is a complete flip flop of what you originally claimed. Game.Set.Match.

In our system, you have no competition since everyone will ask for around the same legal extortion limit set by Bernanke + bank service % fee. We either agree or die.

Don't be silly. Rates vary wildly. Maybe I am running out of room for cows, and my freezer is stocked with meat. I will gladly loan you a bull and a cow for a much lower rate then the farm next door.

The only reason to bring up Bernake though is you are still discussing fiat currency, which is not what this dicussion entails.

Moreover, your example isn't compounding a medium of exchange, you are compounding real assets

a medium of exchange is anything we want it to be. it can be gold, paper money, or cigarettes.

In our example it is bulls, and I did compound it. For simplicity I didn't fully disclose the APY, but trust me, it was compounded.

You just can't magically grow a money supply according to an asymptotic function and expect it to last. All this does is ensure at the end of the game all money is returned to the makers of the game.

And now the class warfare communist drivel comes out. I was wondering when it would show its ugly head.

The workers of the world unite - you are being exploited!

 

[Paul.Bearer.of.Injustice]

Great. so I can ask for compound interest, which is a complete flip flop of what you originally claimed. Game.Set.Match.




Don't be silly. Rates vary wildly. Maybe I am running out of room for cows, and my freezer is stocked with meat. I will gladly loan you a bull and a cow for a much lower rate then the farm next door.

The only reason to bring up Bernake though is you are still discussing fiat currency, which is not what this dicussion entails.



a medium of exchange is anything we want it to be. it can be gold, paper money, or cigarettes.

In our example it is bulls, and I did compound it. For simplicity I didn't fully disclose the APY, but trust me, it was compounded.




And now the class warfare communist drivel comes out. I was wondering when it would show its ugly head.

The workers of the world unite - you are being exploited!

Yes, you can ask for my kidneys if you want. It doesn't make it right or intelligent. But then again I don't expect any more from the likes of you.

It's common sense, not marxism. Tell me... what kind of production follows a geometric curve to keep up with an asymptotic function?

 

[Paul.Bearer.of.Injustice]

Then again, us Astrians recognize that paper backed by nothing more than the paper itself has not much intrinsic value. It is hardly money and history has shown it to be a medium of exchange that does not last. Also, when we refer to money, we do not assume the US dollar but money as money itself... Legal extortion? LOL

How would compound interest work with gold as a medium of exchange?
The production of gold will never be geometric.
Isn't that the reason for Bretton Woods in the first place?

 

[ARealConservative]

Yes, you can ask for my kidneys if you want. It doesn't make it right or intelligent. But then again I don't expect any more from the likes of you.

oooohhhh....the likes of me

If I'm going to die from a kidney failure, seems like it would be pretty intelligent to ask if anybody would sell one.....to the likes of me

It's common sense, not marxism.

It's an irrational fear that free markets exploit the lower class. Pepper it up with words like proletariat and bourgeoisie and bingo!

Tell me... what kind of production follows a geometric curve to keep up with an asymptotic function?

 

[Paul.Bearer.of.Injustice]

oooohhhh....the likes of me

If I'm going to die from a kidney failure, seems like it would be pretty intelligent to ask if anybody would sell one.....to the likes of me



It's an irrational fear that free markets exploit the lower class. Pepper it up with words like proletariat and bourgeoisie and bingo!

I'm pro free-market. It's impossible to have a free market with compound interest.
Your attacks on me aren't worth much considering your lack of understanding of logarithmic functions.
PolySci degree?

 

[danberkeley]

I'm pro free-market. It's impossible to have a free market with compound interest.
Your attacks on me aren't worth much considering your lack of understanding of logarithmic functions.
PolySci degree?

Why, mathematically and practically, is it impossible to have a free market compound interest?

 

[ARealConservative]

I'm pro free-market. It's impossible to have a free market with compound interest.

It is impossible to prevent compound interest in a free market.

I'd say this paradox trumps yours.

 

[krazy kaju]

Why yes [Redacted by Moderator], I do. Do you?

A simple example for you (I won't get into [color="red"Quesneyian[/color] models), would be qualifying the question you seem unwilling or unable to respond. The question of the [color=red]Free-market[/color] model versus [color="red]Centrally Planned Model[/color], which, for this [color="red"]experiement[/color] only, we will leave as extremely broad examples of "economic models".

In a Free Market system, the argued point is that the "invisible hand" of the free market will guide a system to economic prosperity, and without the hubris, do so without central planning. A valiant and noble argument this may be, many theorists still believe that no one economic model can capture the forces behind an economic system. I believe this as well, and strongly favor a "freemarket" approach to economic models...

Some models that I favor include your oiled version of the Free Market, some Keynesian models, Reflexivity (Leontief and Soros), and in regards to price optioning equity, the Black-Scholes model.

You can continue to ignore me, or respond by asking more questions, you still have not answered my question. If you respond nicer, I will do the same. Arbitrarily dismissing me does not equate to me going away.

Cheers.

First of all, you clearly do not know what a model is. An economic model tries to quantify certain aspects of human action. It is not much different from a mathematical model.

For example, the Phillips Curve is a model:

There are also models to show Pareto efficient behavior:

The supply and demand curve is a popular economic model:

The Hayekian triangle could be considered an economic model:

The PPF curve is also an economic model:

There's also the IS/LM model:

Secondly, where did I propose anything but the free market?

Thirdly, I took the liberty to highlight your grammatical mistakes. Besides not knowing jack shit about economics, you could really improve your English. Remember, this is coming from someone who's first language is Polish.

Lastly, don't tell me I'm rude. You were the one who called a relatively well-known and respected economist a "clown" and other insults. You should be ashamed of yourself, your own ignorance, and your stupidity.

There is nothing wrong with this. You of course are showing this on a 1 to 1 basis. But of course banks have 100's of customers and loans are always ending and issuing new loans, plus they have the option of calling in the loans. This would take tons of the investment power out of the country, and like you said investment is usually made through loans. Plus what would be the incentive to run a bank. You would not make any money as you would have to pay the person giving money almost the same as you would charge the person you were losing money. After your overhead expenses and default risk no one would bank. I am new to the Ron Paul movement but I highly doubt that Ron Paul supports eliminating loaning on margin. Plus a free market would support loaning on margin, do you only want a quasi-free market?

First of all, you're completely ignoring the history of full-reserve banking. Full reserve banking used to be the norm.

Secondly, you have to understand the difference between an irregular deposit contract and the mutuum contract. By taking your money into a deposit, the bank acknowledges that you can withdraw all of your money at any time. This is key, because if they do not have ALL the money at ALL times, they broke their contract. A mutuum contract means that you can only take back your money after a given time (i.e. one year). This today is known as a certificate of deposit (CD) and is essentially a loan to the bank.

So it's key to remember that legally speaking, not keeping full reserves is wrong. Take gold and oil ETFs, for example. You can buy and sell on the market without having physical assets, but there has to be a one to one ratio legally when it comes to paper representations and barrels of oil/ounces of gold.

Lastly, saving and investment would not be killed by full reserve banking. Saying so is ridiculous, why weren't saving and investment killed when we practiced full reserve banking earlier? You would just have to pay banks a small fee for storing your money unless you gave it to them in a CD. Investment would probably increase, actually, as people would not keep large amounts of money in deposits but move into stocks and CDs.

Your example isn't compound interest, it's a $1 service fee which is completely different.

The same principle applies. As long as lenders and people who are not in debt can buy the services/products of people who pay compound interest, there is no danger to the economy.

You also have to remember that banks don't want your property. They want their money, so they won't make a loan if they know you can't pay it back. They only take collateral for the "what if" scenario.

 

[MsDoodahs]

Just a quick hello and welcome to the forums, krazy kaju.

Thanks for what you'e doing.

 

[The_Orlonater]

Krazy Kaju= epic win.

Great posts, thank you.

 

[cien750hp]

1. The Gold Standard

OK, this one really gets me angry. Many Ron Paul supporters don't even know what the gold standard is. I'll tell you what it isn't: it's not the scenario where a currency is pegged to gold. That's a gold exchange standard.

The gold standard is the situation where either gold coins are used as currency or where there are certificates representing certain values of gold (i.e. you could have a 1 oz certificate exchangable for 1 oz of gold at any time). Banks usually store gold and provide certificates for their gold reserves.

first off, let me post a disclaimer here that i am highschool student so my knowlege isn't quite up to everyones level here, but, this seems backwards to me. the gold exchange standard seems to me like a certificate could be exchanged for gold, where the gold standard would just be a standard the currency is pegged to.
are the names just confusing like that or am i missing something?


(i understand it now as say, under the gold standard you could take $100 in and get 1/10th ounce of gold, but under the gold EXCHANGE standard you merely know your $100 is worth $100 and no more can be printed causing devaluation of your money because it is pegged to the amount of gold they own but you can't actually get a piece of gold) that seems backwards :/


edit: i based that off of gold at $1000/ounce

 

[krazy kaju]

first off, let me post a disclaimer here that i am highschool student so my knowlege isn't quite up to everyones level here, but, this seems backwards to me. the gold exchange standard seems to me like a certificate could be exchanged for gold, where the gold standard would just be a standard the currency is pegged to.
are the names just confusing like that or am i missing something?


(i understand it now as say, under the gold standard you could take $100 in and get 1/10th ounce of gold, but under the gold EXCHANGE standard you merely know your $100 is worth $100 and no more can be printed causing devaluation of your money because it is pegged to the amount of gold they own but you can't actually get a piece of gold) that seems backwards :/


edit: i based that off of gold at $1000/ounce

The gold standard is a system where you have certificates that represent holdings of physical gold, similar to how you can buy into the pool accounts on kitco.com, monex.com, and Perth Mints. Essentially, under a gold standard, gold coins and certificates that represent one ounce, two ounce, etc. are considered currency. Banks usually store the gold and produce certificates that you then use as currency.

Under a gold exchange standard, a fiat currency (like the USD) is pegged to gold by the central bank. The central bank then promises to exchange the fiat currency for gold. The problem with the gold exchange standard is that the government can change or completely remove the peg, which allows high rates of monetary expansion and inflation to continue.

Many people erroneously believe that Ron Paul is for a gold exchange standard when in reality he is for a true gold standard. Early on in his campaign I believe he stated something about removing the capital gains tax and restrictions on using gold and silver as currency as to allow it to compete against the USD.

 

[krazy kaju]

It's really unfortunate that you have no idea what you're talking about regarding the severity of global warming. It's even past the point of theory and entering reality. You can just read the news to see the damage it's causing -- fires in California, floods along the Mississippi, heat waves in the north east, drought in the south east ... ... ... all at the same time. And that's just the US -- there's also cyclones in Burma killing a hundred thousand people, floods in Bangladesh displacing millions.

Just that those fires, floods, heat waves happened before. The difference now is that we have over six billion people living closely together, so disasters today cause many more deaths than the same disaster would've caused hundreds of years ago.

Am I denying that some disasters, most notably floods, are increasing in intensity? No. But at the same time that doesn't justify destroying a several trillion dollar economy and hundreds of millions of lives to have a very negligible impact on the environment as India and China keep expanding.

At the same time, we have less people dying from the cold in the winter and we have more fertile land in some areas.

And sometime in the next few years, the arctic will be completely without ice during the summer.

You need to learn to use sources. I'm not going to believe this until you provide a reputable source.

And you're telling me global warming isn't a big deal? Global warming denial is pseudoscience of the worst kind, akin to creationism and holocaust denial. You have your head in the sand, and I fear you'll never wake up.

Where have I said global warming isn't real?

I explicitly stated that global warming is real, but that folks like Al Gore are blowing the situation out of proportion. Again, I'll direct you towards my good friends at the 2007 IPCC who said that global sea levels will rise only by one and a half feet maximum this following century... not the 20 feet that Al Gore "predicted" in order to make a quick buck (not to mention a footnote in a history book somewhere).

I checked out one of them, and it said this: "Although other countries spend considerably less than the United States on health care, both as a percentage of GDP and per capita [...]" Which of course backs up what I was saying. How do you explain that one away -- it came from your own document!

You checked one source? Congratulations, at least we know you can read.

What you just said is in agreement with everything I've stated so far. Since the United States is so much more wealthier (after-tax) than every other nation, Americans can afford to spend a greater percentage of their wealth on nonessentials like health care.

Countries like France spend less money both as a percentage of GDP and per capita, even including taxes, on health care. And they cover everyone. That is far, far superior to the broken system we have, people in America would gladly wait in line so they can have health care more cheaply and so no one dies for lack of care. Less money for better care. How can you argue with that? It blows my mind..

Where the hell did you get the "better care" from?

Doctors and nurses are paid less. There are doctor shortages. They make significant use of copayment to ease shortages... which doesn't amount to universal health care. American cancer and AIDs patients have better survival rates... The WHO ranked the USA #1 in terms of health care quality (not equality or DALE).

Where do you get this absurd notion that universal health care = better health care?

Heh, I would much prefer "failing" to "already failed 30 years ago and continuing to get worse."

Notice that for the past 30 years we've had greater government intervention.

Correlation, anyone?

That WHO ranking which you are refering to does indeed have the US as #1 in responsiveness. Meaning, we have shorter lines for those who can afford it. That much is true. How you can just blow off "fairness of distribution" as if it doesn't matter, though, is mind-boggling.

If you read the methodology report of the WHO, responsiveness accounts for health care quality also. That includes quality and quantity of medical equipment, hospitals, family doctor practices, etc.

Let's use an abstract example. In the US, let's say, we spend $10 total on health care for both person A and B. However, only person A gets any treatment beyond ER visits. In France, they spend the equivalent of $7 for person A and B. Both A and B get full treatment, although they have to wait a little longer. Obviously, France's system is superior to the US, it seems impossible to deny.

Wrong again buddy. As I've stated ad nauseum, nations with universal health care have the worst quality health care. The more government gets involved, the worse it is (i.e. Canada and the UK). The countries with the best universal health care (i.e. France, Netherlands, Switzerland) make the greatest use of market forces like copayments... yet they still have inferior health quality to the United States.

And you still haven't responded to the points I made backed by the sources I posted previously. i.e. how US cancer patients have better survival rates than the cancer patients of nations with universal health care.

You have the "free market" built up in your mind as the ultimate good, something that is perfect with no failings whatsoever. Nothing is perfect. It has flaws.

You love strawmen, don't you?

Sometimes, government intervention is better than the free market. Sometimes, the free market is better than government intervention.

I love statements made without proof.

Right now, we have the worst kind of mixed system -- a system where government and business have merged and both become corrupted by it. Our system obviously sucks, everyone knows it. People on what is called the 'right' say, "Our mixed system has failed because of government intervention!" People on the 'left' say "Our mixed system has failed because of the involvement of business and the free market!" But both know it has failed.

Admittedly, I think our health care system would get better if government completely got out of it, like you want. But I think the best health care system is one where business completely gets out. I think our country's workings should be mixed, but a mixed system where either the government or business has complete reign. In some fields government should get out, and in other fields, business should get out.

More unbacked statements.

This debate is getting boring with you ignoring everything I say and all the sources I provide and then you responding with the same stuff all over again.

How 'bout you go a couple pages back in the thread and actually read through the sources and watch the video I provided? Then you'll actually understand what's at stake here and the free market way to fix health care.

Seriously. Just read the sources.

 

[Paul.Bearer.of.Injustice]

It is impossible to prevent compound interest in a free market.

I'd say this paradox trumps yours.

It is also impossible to prevent murder in a free society. What is your point?

Unless real wealth is destroyed, real wealth creation MUST follow follow this curve in a compounding interest economic system or the system will implode. That is why we were forced to change to a fiat currency ... reached the point in 1971 where this chart explodes and no "Real" medium of exchange(gold/silver) can match this curve. And now we can't even make paper dollars fast enough so now everything is electronic or book entries.

So yes - compound interest can exist in the portion of the curve which is linear (1800-1971) and growth is relatively small, and the system will work. But it will be inevitably destroyed at the point where we can't keep up with infinite growth (the asymptote) as demanded by our money tied to this mathematical function. And at that point, all real wealth(homes, land, property) will have completed its journey through the system and back to the FED. The unnatural explosive growth of money in a compounding interest system is what caused the conditions for the creation of the FED and fiat currency in the first place, and it will happen again 200 years from now if we repeat the mistake in the next economic system after this collapses

 

[danberkeley]

The unnatural explosive growth of money in a compounding interest system is what caused the conditions for the creation of the FED and fiat currency in the first place...

So your saying that the bankers that secretly wrote the Federal Reserve Act are our saviors because they saved us from "unnatural explosive growth of money in a compounding interest system"? lol No wonder our standard of living has improved since then.

 

[cien750hp]

The gold standard is a system where you have certificates that represent holdings of physical gold, similar to how you can buy into the pool accounts on kitco.com, monex.com, and Perth Mints. Essentially, under a gold standard, gold coins and certificates that represent one ounce, two ounce, etc. are considered currency. Banks usually store the gold and produce certificates that you then use as currency.

Under a gold exchange standard, a fiat currency (like the USD) is pegged to gold by the central bank. The central bank then promises to exchange the fiat currency for gold. The problem with the gold exchange standard is that the government can change or completely remove the peg, which allows high rates of monetary expansion and inflation to continue.

Many people erroneously believe that Ron Paul is for a gold exchange standard when in reality he is for a true gold standard. Early on in his campaign I believe he stated something about removing the capital gains tax and restrictions on using gold and silver as currency as to allow it to compete against the USD.

ohhh it all makes sense now! thanks for clarifying all of that.
we definitely need those competing currencies now at least we're allowed to buy gold and silver on the market, even though we can't use it

 

[ronpaulblogsdotcom]

You have 30 posts and you are the expert on what RP supporters know and dont know? Sorry doesnt work that way.

Maybe if you enlightened us with more than 30 posts we would be smart as well.

The average Rp supporter is the best educated group in ANY current political group.

And some of that is just your opinion. Monopolies good? hehe And you use Microsoft and Coca Cola as examples.. Microsoft has crappy overpriced products that are not created for the markets. They are packaged to capture as many markets as possible.

And Coca Cola has killed countless people to force coca cola in countries that did not want to take it. I can get a canned cola from countless companies that tastes the same or better. Many with healthier cane sugar than fructose....

Remember the origins... Cocaine!

Personally I think monopolies dont create economies of scale. They create waste and complacent companies.

 

[Paul.Bearer.of.Injustice]

So your saying that the bankers that secretly wrote the Federal Reserve Act are our saviors because they saved us from "unnatural explosive growth of money in a compounding interest system"? lol No wonder our standard of living has improved since then.

No, they did the only logical thing possible to keep a flawed system functioning. Human resistance to change overwhelms conscience and/or intelligence.
They either figured the flaw out then, or had their economic "PNAC" in place planned ahead of time knowing simple mathematics.
If we were all herded into state of the art detention centers with food, shelter, and sustenance for all, would our standard of living not increase? It's seductive but we know from history it will fail because tyranny is inconsistent with the human spirit. Likewise, compound interest is seductive but it is inconsistent with simple physical/natural laws.

Thus, we have sacrificed liberty and ownership for false prosperity. We have chosen to rent many things instead of owning a few outright(as RP says 'living within our means'), and in doing so we have given up our sovereignty. We chose seduction instead of intelligence.
In 1913 or 1971 we could have changed the system knowing we were approaching a physical impossibility - a mathematical slope of infinity.