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Post by Deleted on Dec 30, 2010 21:57:09 GMT -5
That doesn't answer, why would we want to pay off our debt or need to pay off our debt?
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Post by traelin0 on Dec 30, 2010 21:57:27 GMT -5
I'm not even saying what he said isn't true, of course the banks control the money supply, but again IMHO its all hyperbole. What he said was very accurate. The Federal Reserve Note is a liability of someone else. There is no way in our monetary system to have zero debt. It IS debt. All these politicians talking about "paying down the debt" don't have a clue as to how our monetary system works. |
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Post by traelin0 on Dec 30, 2010 21:58:12 GMT -5
That doesn't answer, why would we want to pay off our debt or need to pay off our debt? Because public debt always reaches the point where it cripples capital flows. |
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Post by Deleted on Dec 30, 2010 21:59:15 GMT -5
That doesn't answer, why would we want to pay off our debt or need to pay off our debt? Because debt always reaches the point where it cripples capital flows. I don't buy it. If money=debt and the economy needs money to survive, why would we want to be debt free? |
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deziloooooo
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Post by deziloooooo on Dec 30, 2010 22:01:04 GMT -5
"Arch, we've defaulted on our citizens once, and on the world once"
We did? Ok I'm the stupe now, when? When we went off the gold standard?
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Post by traelin0 on Dec 30, 2010 22:01:19 GMT -5
I don't buy it. If money=debt and the economy needs money to survive, why would we want to be debt free? It's the mathematical laws of exponentials. Our monetary system feeds on itself in order to survive. Compound that with the fact that human action, that is, confidence, is the only thing backing a debt-based system that is exponentially increasing and you can see why every other attempt at such a system has failed within a human lifespan. |
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Post by traelin0 on Dec 30, 2010 22:03:03 GMT -5
We did, ok I'm the stupe now, when. When we went off the gold standard? We haven't been on a domestic gold exchange standard since 1973 or so. Nixon closed the gold window on 15 AUG 1971, but it was technically still in effect until 1973. That was a default on the world, because Bretton Woods guaranteed that we would maintain the dollar as good as gold at the international exchange rate of $35/oz. We lied. The first default was on ourselves in 1933, which went in effect in 1934. |
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Post by Deleted on Dec 30, 2010 22:03:09 GMT -5
I don't buy it. If money=debt and the economy needs money to survive, why would we want to be debt free? It's the mathematical laws of exponentials. Our monetary system feeds on itself in order to survive. Compound that with the fact that human action, that is, confidence, is the only thing backing a debt-based system that is exponentially increasing and you can see why every other attempt at such a system has failed within a human lifespan. I don't buy that either. Everything in human existence has failed, or else it is currently ongoing, in which case it is only on its way to failure. That argument doesn't mean a hill of beans. |
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Post by traelin0 on Dec 30, 2010 22:04:57 GMT -5
I don't buy that either. Everything in human existence has failed, or else it is currently ongoing, in which case it is only on its way to failure. That argument doesn't mean a hill of beans. You don't buy the fact that that is how our monetary system works?  Of course everything in the world changes. But fails? No. Only human beings fail whenever they don't adhere to the rule of law. We haven't adhered to our monetary rule of law in a century. Archie, there isn't enough currency printed to cover the interest payments. It is a mathematical certainty that it eventually hits a wall. |
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Post by Deleted on Dec 30, 2010 22:08:11 GMT -5
I don't buy that either. Everything in human existence has failed, or else it is currently ongoing, in which case it is only on its way to failure. That argument doesn't mean a hill of beans. You don't buy the fact that that is how our monetary system works? Of course everything in the world changes. But fails? No. Only human beings fail whenever they don't adhere to the rule of law. We haven't adhered to our monetary rule of law in a century. I don't know what your explanation of our monetary system is. I was referring to the fact that you used an argument that previous systems have failed so that means our current system is bound for failure. |
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Post by traelin0 on Dec 30, 2010 22:09:20 GMT -5
I don't know what your explanation of our monetary system is. I was referring to the fact that you used an argument that previous systems have failed so that means our current system is bound for failure. In debt-based monetary systems, they do. When a loan is created, the currency isn't also created to pay the interest. It mathematically hits the law of exponents. |
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Post by Deleted on Dec 30, 2010 22:11:06 GMT -5
I don't know what your explanation of our monetary system is. I was referring to the fact that you used an argument that previous systems have failed so that means our current system is bound for failure. In debt-based monetary systems, they do. When a loan is created, the currency isn't also created to pay the interest. It mathematically hits the law of exponents. Ok, I don't buy that is how our monetary system works, then. I think it can fail, certainly. I think it can change, certainly. I don't think it is destined to fail. |
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deziloooooo
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Post by deziloooooo on Dec 30, 2010 22:18:11 GMT -5
Tell me about the default...what exactly did that do. Did we devalue our currency?
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Post by traelin0 on Dec 30, 2010 22:18:19 GMT -5
Ok, I don't buy that is how our monetary system works, then. I think it can fail, certainly. I think it can change, certainly. I don't think it is destined to fail. But that is how our monetary system works. Where is the issuance of the currency to pay the interest come from? |
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Post by Deleted on Dec 30, 2010 22:19:32 GMT -5
inflation
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Post by traelin0 on Dec 30, 2010 22:20:37 GMT -5
Tell me about the default...what exactly did that do. Did we devalue our currency? We refused to exchange the dollar for gold with the rest of the world. We told them that our deficits are their problem. Several monetary theorists trace our default directly to the Vietnam War and the Great Society, but cause aside, we defaulted on Bretton Woods. |
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Post by traelin0 on Dec 30, 2010 22:22:18 GMT -5
Not unless you drop money from helicopters and give it directly to the debtors. And in that case, you get to one of the only two conclusions that I talked about in the beginning of this thread. And you still haven't changed the balance sheet. Those newly issued FRNs are someone else's liability. Where is the interest going to come from for THOSE FRNs? |
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Post by Deleted on Dec 30, 2010 22:24:50 GMT -5
Not unless you drop money from helicopters and give it directly to the debtors. And in that case, you get to one of the only two conclusions that I talked about in the beginning of this thread. And you still haven't changed the balance sheet. Those newly issued FRNs are someone else's liability. I still don't buy it. We will have to agree to disagree that our monetary system was destined to fail from day one. |
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Post by traelin0 on Dec 30, 2010 22:27:26 GMT -5
I still don't buy it. We will have to agree to disagree that our monetary system was destined to fail from day one. Our monetary system wasn't destined to fail from day one. Morgan created the FED skeleton after he bailed our country out of massive gold outflows during the Panics of 1893 and 1907. The initial institution of the FED, while grotesque, worked "better" than when it was purely a fiat cartel. When we went to paper backed by nothing, it was indeed destined to fail, mathematically speaking. |
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Post by Deleted on Dec 30, 2010 22:29:04 GMT -5
when we went to paper backed by nothing, it was indeed destined to fail, mathematically speaking. Ok, so we will have to agree to disagree that our monetary system was destined to fail from this point (above). |
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Post by traelin0 on Dec 30, 2010 22:31:10 GMT -5
Ok, so we will have to agree to disagree that our monetary system was destined to fail from this point (above). But that is how it works. Where do Federal Reserve Notes -- IOUs really -- come from? When are they created? |
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Post by Deleted on Dec 30, 2010 22:33:42 GMT -5
Ok, so we will have to agree to disagree that our monetary system was destined to fail from this point (above). But that is how it works. Where do Federal Reserve Notes -- IOUs really -- come from? When are they created? They come from the printing press. |
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Post by traelin0 on Dec 30, 2010 22:36:14 GMT -5
They come from the printing press. Physical notes are much smaller in quantity than their digital representations, and the physicals come from the BEP. But WHEN are they issued? Let me take a different tack. Who are the parties and counterparties in an exchange of FRNs? |
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Post by Deleted on Dec 30, 2010 22:37:28 GMT -5
so what are we arguing about? I lost track.
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Post by traelin0 on Dec 30, 2010 22:39:34 GMT -5
so what are we arguing about? I lost track. You were arguing that a debt-based system is sustainable. I am arguing that not only has every other attempt failed within a long human lifespan, with the average age being 40 years, but that it is mathematically unsustainable because our currency is a balance sheet liability with counterparty risk; there is never enough currency in the system to extinguish all interest. |
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Post by Deleted on Dec 30, 2010 22:44:18 GMT -5
so what are we arguing about? I lost track. You were arguing that a debt-based system is sustainable. I am arguing that not only has every other attempt failed within a long human lifespan, with the average age being 40 years, but that it is mathematically unsustainable because our currency is a balance sheet liability with counterparty risk; there is never enough currency in the system to extinguish all interest. Oh yeah, and I say hooey. |
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Post by traelin0 on Dec 30, 2010 22:46:57 GMT -5
Oh yeah, and I say hooey. So this time is different? |
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Post by Deleted on Dec 30, 2010 22:50:48 GMT -5
Oh yeah, and I say hooey. So this time is different? Yes. This time we have the power of love. |
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Post by traelin0 on Dec 30, 2010 22:53:59 GMT -5
Yes. This time we have the power of love.See, this is why I initially voted for you for Mod. ;D |
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deziloooooo
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Post by deziloooooo on Dec 30, 2010 23:07:56 GMT -5
well I am glad we are all in love here and when I have time I will google the Britton woods and see what is there to confuse me more.
Just a quick one..so when we violated the Britton Woods..example sake. XYZ country had one doller of of debt,say a bond...after we said it's there problem , the debt, the one doller of debt was not worth the one doller any more, because we would not redeem it in gold , there fore it depreciated from the doller and was worth less?
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Of course everything in the world changes. But fails? No. Only human beings fail whenever they don't adhere to the rule of law. We haven't adhered to our monetary rule of law in a century. Archie, there isn't enough currency printed to cover the interest payments. It is a mathematical certainty that it eventually hits a wall.