[quote=RNcarl] If the gooberment has the power of "Monetary Sovereign-ity" then why is there a "National Debt?"
If they can "will" digits into existence then why do they need to create "gooberment bonds?"
I know, I know, that was two questions. Not one…
C.
[/quote] RNC are you assuming that the jet propulsion engineer can count to 2?
If not you might want to ask him just why our kids are on the hook for a 10.4 trillion dollar "bailout’, or why we have over 80 trillion NPV off balance sheet liabilities, or why we borrow 54 cents of every dollar we spend, and since there aren’t enought lenders we actually "print" most of that. And I don’t give a rats (ehem) if it is electronic printing or vis a vis the treasury. Debasement is debasement.
[Moderator’s note: This post is a violation of the forum guidelines. Personal attacks and name calling are not allowed. Appropriate corrective action with the user has been undertaken.]
Unintended consequences? Not in a thousand years! Get it! The intention IS to cause a long term, painful collapse so that the people will clamor for at least accept some "reform" that further centralizes power, takes more liberty and eventually creates a condition of complete subservience to not national but a world cartel of bankers (IMF, etc.) and politicians, One World Government. This is and has been the "progressive/socialist/Fabian/elitist" goal for many years. Go back to US history after the civil war and understand that the purpose of the many "money panics", engineered by the banks, was to create so much pain that a new central bank could be birthed.
…these are thrilling times we live in now. As far as being off topic, it’s the weekend and are allowed a few of these because of the total and complete bullshit we must hear each and every day from those we vote to look out for our common interests (yet always bamboozle us in all important matters). Or from those who believe they are enlightened beyond that of mere pheasantry like Roger the dodger here (his rhetoric not perhaps the man in any account).DOG, You cut your teeth on the first game of the 68 world series, Gibson against McClain!!! It gets no better than that. 1.12 seasonal era (Gibson) against a 32 game winner (McClain), WOW!
BOB
[quote=Peter Smith]Unintended consequences? Not in a thousand years! Get it! The intention IS to cause a long term, painful collapse so that the people will clamor for at least accept some "reform" that further centralizes power, takes more liberty and eventually creates a condition of complete subservience to not national but a world cartel of bankers (IMF, etc.) and politicians, One World Government. This is and has been the "progressive/socialist/Fabian/elitist" goal for many years. Go back to US history after the civil war and understand that the purpose of the many "money panics", engineered by the banks, was to create so much pain that a new central bank could be birthed.
[/quote]
Mostly agree. When people are desperate they will be willing to allow any remaining environmental / social / constitutional safeguards to be axed, thereby granting the elites full unfettered access to the little remaining wealth available for the taking, wealth that once belonged to everyone via the government. It is a way of turning the populace against itself, to get the average person to equate private banks with the government. To the average person those two are the same, but it is the government that is owned by the private elites, via the private banks. The government no longer serves the people. So rather than railing around cutting government, maybe we should be railing around taking back the government.
This is definitely not socialism. This is the antithesis of socialism. US Federal spending has been going down for the last 25 years and it is now near the lowest in the industrialized world. The number of poor people is increasing dramatically, while a very elite 0.000001% of the population that is well connected to the upper eschelons of the corruption are living like kings while they steal from everyone else. That is extreme wealth concentration, and definitely not socialism. It is crony capitalism taken to its inevitable end. And some people actually believe that increasing taxes to the wealthy is going to hurt the economy???
This "socialism" meme is one perpetrated by the private banks to provoke the free market idealogues to argue for the complete deregulation of everything, to eliminate any remaining protection from the mafia the average person currently enjoys, via some deluded belief that free markets are efficient.
For an example of moderate socialism / mild capitalism look to Sweden, and they’re doing very well compared to almost every other industrialized nation, humming along with a transition to renewable energy infrastructure.
Chris
Thanks for a great interview. Such indepth discussions with Marc Faber are as illuminating as they are rare.
I have also just finished relistening to your interview with John Williams from Shadowstats from about a year ago. Providiing access to these minds is a wonderful service and your interviewing style by way of constant clarification and lateral links makes them all the more enjoyable.
Ross
…every darn thing
http://www.zerohedge.com/news/march-17-here-are-17-charts-summarizing-us-energy-situation
Why would Rodger waste his money(2 years and 26 weeks) becoming a member of this group with his mind set? He has to be a plant of some sort, is Chris shaking things up that much? Chris must have upset somebody who doesn’t mind wasting money or Rodger wouldn’t be spewing this nonsense that only an idiot or ignorant person could believe. Davos, that # is the best thing about his post, lets hope it stays below 5.
The U.S. became Monetarily Sovereign on August 15, 1971. Prior to that it was monetarily non-sovereign. What actually changed? If you learn the many differences between Monetary Sovereignty and monetary non-sovereignty, you will understand economics. But first, you need the desire to learn.Swearing, sneering and sarcasm will not help you understand economics.
Your focus on the Fed is misplaced. The Fed, federal taxes and all T-securities all could disappear tomorrow, and this would not change the federal government’s ability to pay its bills.
Rodger Malcolm Mitchell
And then there is the fractional re-loaning. Here is where the non-linear aspect occurs due to VELOCITY. The FED thinks it can control it, but it cannot. As Marc stated, the FED has never lived in the real world where lines of credit are pulled for no reason and etc other then the GOD of FED.
Please provide reference where found and context for the graph.
What was Bretton Woods 1944? The US had just kicked arse in WWII and could dictate to the world the new money system. How sovereign is that? Unfortunately, the US decided to cede financial leadership and became debt whore.
[quote=KugsCheese]
And then there is the fractional re-loaning. Here is where the non-linear aspect occurs due to VELOCITY. The FED thinks it can control it, but it cannot. As Marc stated, the FED has never lived in the real world where lines of credit are pulled for no reason and etc other then the GOD of FED.
[/quote]VELOCITY is Bee-S. Has nothing to do with it. I’m way too busy today to post the link, Google Sprott +Baker +Unintended Consequences and then do ctrl-f or command-f on macs and type in china.
Spooking the 900# gorilla has replaced velocity. Google Krasting+Zerohedge +China Oil Imports (they are up 39% YOY).
Rodger,
I’ve used a variant of your argument to convince people that inflation is a form of taxation. If government were to just print (use the "print" word very loosely) and spend money rather than impose taxes, could they do such? What would the consequences be? Most people immediately agree that the US government could supply funding this way. Apparently, at some level, they inherently understand monetary sovereignty. They also realize that the consequence of such action would be inflation. Taken to an extreme, they come to the conclusion that the currency would lose respect and become worthless.
Zimbabwe had and still has monetary sovereignty. They abused the privilege. Their government relied on the seignorage associated with printing as a funding source. Was this abilitity to print, a long term, positive result for anyone in Zimbabwe? A saw a picture of a $100,000,000,000,000 Zimbabwe Dollar Note a few years back. The caption noted that it would only buy 3 ordinary chicken eggs. Other than at a purely academic level, they had lost their monetary sovereignty due to abuse.
Greece was monetarily sovereign before joining the EMU. For years before Greece joined, bond buyers punished them (with high interest rates) for their profligate spending. The EMU looked attractive to Greece because they could resume spending the way they always had, but at a lower interest rate. They were piggy backing on the northern European good will. They continued their borrowing at the lower interest rate. Now, northern Europe wants Greece to pay with austerity and higher taxes. It will be interesting to see how this resolves.
In both cases, the governments chose the easy route. There are many examples of failure in economic history. Monetary sovereignty makes abuse easier to hide, but the end result is the same. Wouldn’t it be better to have a currency that had no sovereign who could abuse it? Why wouldn’t a gold standard be a better choice?
There ain’t no such thing as a free lunch.
Grover
Grover… you nailed it so succinctly I think… Modern Monetary Theory, which Rodger’s ramblings are based on, basically posits the "free lunch" as it’s basis. Zimbabwe is a great example, and I myself always carry a Zim $10Trillion in my wallet for those times when an object lesson is needed.
I appreciate that Rodger posts and does not hide behind a pseudonym… and while I have taken other monetarists, like 2OldtoOkeyDoke, to task in a big way on the CM.com boards, I think we can all benefit by talking this through with Rodger… he is out there in the open with his ideas. Personally, I find this conversation much more interesting than the Faber interview, because it forces us to really think.
Rodger’s ideas are here;
http://rodgermmitchell.wordpress.com/
Rodger actually attends to the question of MMT vs. his "MS" approach;
In this piece, Rodger very clearly points to the theoretical alternate universe that he and other MMT economists have created;
"Neither coins nor paper bills are money. They merely are receipts representing money, which itself has no physical existence. And because money has no physical existence, the government never can run short. In fact, the government, contrary to popular usage, does not print money. It can’t. You can’t print something that does not exist in the physical world.
Because of the universal belief that the federal government is “broke” (Thank you Mr. Boehner), or cannot “afford” to pay for the various things Americans want, Americans must be inconvenienced (heavy coins in the pocket) or worse (lack medical care, retirement funds, etc.) I see that false belief touching every facet of our lives, just like the most restrictive religion you can imagine.
Everything you do, and everything you want to do, and everything you want, is colored by that massive superstition. It influences what you eat, what you wear, where you live, how you live. That false belief affects everything in your world.
And you think religious extremists are nuts???"
So again… how did Zimbabwe go wrong Rodger?
Maybe Rodger can tell us how all of these Government issuers you reference got it wrong…
Rodger & Phyllis Mitchell, 2007
[Moderator’s note: Removed a personal photograph depicting Rodger Mitchell and his wife standing together on a vacation, her head rested upon his shoulder.]
Do you think they have their hands in the Social Security $15.4+ Trillion/ Medicare $81+ Trillion / Prescription Drug $20.4+ Trillion handout till?
It has been my past experience over the last 10 years since uncovering these off balnace sheet liabilities that this gang is the gang who defends the ponzi scheme the loudest. When you ask them how their standard of living would change if this cr@p was oblitereated you’d be amazed to hear how they’d live.
What kills me is this isn’t the gang that can’t get by without it. This is the gang that would have to move out of the gated community, trade in their leased Jag for a 5 year old car, give up their golf membership at "the club" and forgo their nice vacations.
I find it amazing how the people who want their cake and the ability to eat it come out with absolute drivel that condones us being robbed of 86% of the value of our dollar since [our] birth.
Jim Quinn calls them the Free $hit Army. I call this cr@p inter-generational-tyranny.
I’m usually pretty quick to spot that gang. ✓ Golf cap, ✓ casual, not cheap but not dressy clothes, ✓good teeth, ✓decent eyewear, ✓vacation smiles ✓golf|tennis|or boat tan ✓retired ✓professionally done hair. If I had to go out on a limb I’d even take a few guesses at their past employment.
We all know there have been 3,800 Fiat Currencies that have tanked. What many of us aren’t up on is that the average life span of a Fiat currency is 39 years. We’re at gold minus 40 today. Here is the SHORT list of mostly recent currencies who went south.
Country
Year
Old Dollars Needed To Buy New Dollars
Angola
1991-1999
1 New Kwanza = 1,000,000,000 1991 Kwanzas
Argentina
1975-1991
1 New Peso = 100,000,000,000 1983 Pesos
Belarus
1994-2002
50,000 = 100,000,000 2000 Rublei
Brazil
1986-1994
1 Real = 2,700,000,000,000,000,000 1930 Reis
Bosnia-Herzegovina
1993
Massive hyperinflation
Bulgaria
1991-1997
Defaulted on its debt, food shortages, reduced the number of zeros that were added to its currency.
Chile
1971-1973
500%+ Inflation military overthrew the democracy.
China
1939-1950
1937 3.4 Yuan traded $1.00 USD. By May 1949, $1.00 USD = 23,280,000 Yuan
Ecuador
2000
Pegged to USD after 70-80% drop in its dollar
England
1100s
1455-1485
1543-1551
1100s silver in coins fell.
Coins were clipped.
Henry VIII debased the coins to raise money
Greece
1944-1953
1 1953 Drachma = 50,000,000,000,000 1944 Drachmai
France
1789-1797
Death sentence on anyone selling the notes at a discount to gold and silver livres. 1795 a new currency was issued, the mandat, which promptly lost 97% of its value. 1797, both paper currencies recalled new monetary system backed by gold.
Georgia
1995
1 new lari = 1,000,000 laris.
Germany
1923-1924
1945-1948
See chart above.
Hungary
1944-1946
Forint 400,000,000,000,000,000,000,000,000,000 = 4 × 1029 Pengõ
Israel
1979-1985
Price freezes
Japan
1944-1948
5,000%++ Inflation. Issued military currency, anyone caught with Honk Kong currency was tortured.
Krajina
1993
Country folded became part of Croatia.
Madagascar
2004
1 Ariary = Madagascan Francs - Riots persisted.
Mexico
1993-1994
Defaulted 1982. 1 Nuevo Peso = 1,000 Old Pesos.
Nicaragua
1987-1990
1 Gold Cordoba = 5,000,000,000 1987 Cordobas.
Peru
1984-1990
1 Nuevo Sol = 1,000,000,000 1985 Soles de Oro.
Poland
1990-1993
1 new Zloty.10,000 old Zlotych
Romania
2000-2005
1 new Leu = 10,000 old Lei
AncientRome
270AD +/-
Took the Romans 300 years to do what the Fed did in 84 years - debase the currency by 95%. The Roman empire fell, they welcomed the Barbarians.
Russia
1992-1994
100 Rubels = 1 USD 1991 30,000 Rubels = 1 USD 1999.
Taiwan
1940-1950
1 New Taiwan Dollar = 40,000 old Taiwan yuan.
Turkey
1990-2005
1 New Turkish Lira;= 1,000,000 old Lira.
Ukraine
1993-1995
1 Hryvnya =100,000 Karbovantsivi
United States
1812-1814
Continental Currency - Failed
United States
1861-1865
Confederation Notes - Failed
Vietnam
1981-1988
Gold trading was outlawed.
Yugoslavia
1989-1994
1 Novi Dinar = 1,300,000,000,000,000,000,000,000,000Dinars.
Zimbabwe
1999 - 2010
Ongoing mess.
So Rodger, do tell us. Are you part of the Free $hit Army? And in the interest of full disclosure I’m not in it. I’m not part of that 49% crowd. And, if you are in it, why don’t you share with us just how your life would change if you didn’t collect SS, Medicare, Prescription Drugs etc.
[Moderator’s note: This post is a violation of the forum guidelines. Personal attacks, invasion of privacy, and name calling are not allowed. Appropriate corrective action with the user has been undertaken.]
Worth reading all the reviews. One in particular I found interesting (the first one);
The author of the review said this (highlight mine)
"A small group of economists, known as chartalists or MMT-ers (after Modern Monetary Theory) have figured out the fiat (non gold-related) money. The author of the book is not among them, he discovered this by himself, a true genius. His book is definitely recommended, if you want to understand why some countries go bankrupt and others can run 200% debt-to-GDP ratio and manage to sell massive amounts of bonds despite offering near zero interest."
I think the obvious reference here is Japan… and Chris has discussed this much recently since Japan is mathematically closest to their (fiat) endgame… they are in the tightest box when it comes to remaining degrees of freedom to sustain any increases in borrowing costs. I find it interesting that the MMT’ers attribute Japan’s success thus far to something they are doing right… while I think Chris’ observation that the carry trade, which created significant demand for Yen via international borrowing, is the thing that sustained the strength of the Yen over the previous years. The Yen is now weakening as the carry trade unwinds, as Chris has pointed out. For a (manufacturing) nation that imports almost all of it’s resources, a weak Yen will bring about the endgame very quickly… ability to print more "free" Yen notwithstanding. We will see how well Japan’s exercise of it’s monetary sovereignty plays out… though I am sure Rodger and the other MMT’ers will explain to us that Japan just didn’t do it "right".
[quote=Jim H]Maybe Rodger can tell us how all of these Government issuers you reference got it wrong…
[/quote]Jim, you can go inside that book at Amazon and scroll to page 207. Sounds like Rodger did well turning compnaies around, but like his old boss used to tell him, we can also say to him: "Rodger, You’re wrong."
So now Rodger, please tell me if you are that 49% of the upper middle with your hand in the Free $hit’s Army’s cookie jar.
[Moderator’s note: This post is a violation of the forum guidelines. Attacks of a personal nature are not allowed. Appropriate corrective action with the user has been undertaken.]
[quote=KugsCheese]
Please provide reference where found and context for the graph.
[/quote]
Hey Kugs, I wrote a piece about it in my blog. I made it from taking this graph of federal receipts / spending and dividing by population. Now, I admit that I do not subscribe to Shadowstats (maybe I should) so I had to very carefully measure the numbers off the graph and enter them into Excel myself. I would actually really appreciate if someone would take the raw data from Shadowstats and redo the graph, because mine isn’t perfect due to me eyeballing the line. But my eyeball measurements are probably pretty close.
http://nowandfutures.com/inflation_long_term_log.html#spend
So again… how did Zimbabwe go wrong Rodger?Robert Mugabe stole farm land from people who knew how to farm, and gave it to people who didn’t.
Next question.
Rodger Malcolm Mitchell