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Do you favor constant deflation, constant inflation, or the Fed/boom-bust cycle?

A

Anarchist420

Diamond Member
I favor constant deflation. It's the natural way of things because in a free society the supply of money would be a lot tighter and credit would be very tight. The government wouldn't be robbing you of your savings and you wouldn't have to invest in the risky stock market. Of course, the Fed isn't as awful as greenbackism, but it still sucks because it inflates much more than it deflates.

I hate how they always reinflate bubbles after they burst. We wouldn't be in this mess if Bernanke had just let the bubble burst and if he had just kept high interest rates/decreasing the money supply.

Under a Greenback system, the fiat currency would be money rather than credit and there would be 100% reserves, but then the government would just print away and say that banks couldn't charge more than 1% interest. So that steals from people who save. The Fed screws every creditor but itself so it screws savers more than it screws debtors. Imagine if Herbert C. Hoover had just ordered the banks to raise their specie reserves to 100% of all the gold they had and if he hadn't intervened in the economy (he increased unemployment by forcing wages not to be adjusted for deflation). The GD never would've happened or it at least would've been over more quickly.

Much more important than the utility argument is the fact that FRB is unethical, especially when it's aided by a central bank because the central bank is a perpetual bailout. Greenbackism is also unethical. Governments should not be allowed to create money or credit. They should also own not more than 1/3 of the land in the world. At least 2/3 should be reserved for people who wish to live outside of government.
 
I like natural inflation when everyone is making money, everyone is buying stuff and the Fed is not printing money for the sake of saving banks but in order to maintain a healthy supply of currency.

Deflation is accelerating though. IMO.
 
kk


edit: you're aware that we had booms and busts well before the fed was ever around, right?
 
ElFenix said:
kk


edit: you're aware that we had booms and busts well before the fed was ever around, right?
Click to expand...
Yes, but the booms weren't as severe. The problem was that some States chartered deposit insurance companies and allowed or even encouraged fraud. The States that mandated tight credit policies usually did fine.
 
Anarchist420 said:
Yes, but the booms weren't as severe. The problem was that some States chartered deposit insurance companies and allowed or even encouraged fraud. The States that mandated tight credit policies usually did fine.
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you're also aware that history doesn't start with the american revolution, right?
 
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Deflation is a horrible thing. Especially if you're young and starting out. Deflation really only benefits the already established rich.
 
karmypolitics said:
Deflation is a horrible thing. Especially if you're young and starting out. Deflation really only benefits the already established rich.
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Not really. If the money supply in circulation were to double in two years, my parents' savings would be halved quite quickly. If the money supply were to go down by one half, then I wouldn't ever have to work provided taxes were a little bit lower than they are now. Inflation hurts people who save, not poor people.

Inflation via fractional reserve banking helps the rich the most. Interest is charged on credit rather than on money. With a central bank, that makes it hard for banks to lose money.

Inflation and central banking helps the investor class like no one else.
 
Slow inflation is better than boom/bust and deflation. Look at the US as an example. Overall, we have experienced slow inflation with small periods of boom/bust. Everyone's standard of living (in the US) is far higher than it was in the 70s. The poor in the 70s did not have TV, they used party line phones (one number shared by many people), etc. Today, even the poor have at least one TV (many have more), they have cell phones, cars (sometimes more than one), etc.

The standard of living is higher now than before, so the system works properly.
 
Anarchist420 said:
Not really. If the money supply in circulation were to double in two years, my parents' savings would be halved quite quickly. If the money supply were to go down by one half, then I wouldn't ever have to work provided taxes were a little bit lower than they are now. Inflation hurts people who save, not poor people.

Inflation via fractional reserve banking helps the rich the most. Interest is charged on credit rather than on money. With a central bank, that makes it hard for banks to lose money.

Inflation and central banking helps the investor class like no one else.
Click to expand...


What D:
 
Are you sure you don't mean Disinflation (the slowing of inflation rate)? Deflation is not ever a good sign for an economy... It results in the contraction of the economy and generally the reversal of deflation is not easy to accomplish. If we get into that spiral here in the US we'd see half the working population unemployed and the misery would continue.
Imagine having debt fixed at some percentage and earnings constantly dropping... I'd doubt the 1% would manage to survive... All their money won't buy what ain't for sale...
 
karmypolitics said:
Deflation is a horrible thing. Especially if you're young and starting out. Deflation really only benefits the already established rich.
Click to expand...


Inflation eats up savings and fixed incomes for dinner. If you had $100,000 in a savings account with a yearly average of a 4% increase inflation you'd eventually have in 10 years 87,000 dollars, etc in this savings account and that is without factoring in taxes and account fees.

Furthermore when inflation goes up so does the cost of living (i.e. prices on goods and services go up) which hurts the poor and anyone on a fixed income. Rich people generally can negate the effects of inflation by investing their money in order to keep it moving within the economy via investments and thus generating more wealth for them as time move forward but lower income people either do not have this options to take risks or are not financially knowledgeable enough to understand why they should be investing.


On the other hand deflation would actually promote savings and help those on fixed incomes because of decreased prices of goods and services. However deflation can be a job killer and can also compound debt by deprecating the initial value a loan or investment. So it can also act as an unseen tax on any new investment which would decrease demand for loans or availability of investment dollars in the economy.

Neither scenarios are optimal.
 
DucatiMonster696 said:
Inflation eats up savings and fixed incomes for dinner. If you had $100,000 in a savings account with a yearly average of a 4% increase inflation you'd eventually have in 10 years 87,000 dollars, etc in this savings account and that is without factoring in taxes and account fees.

Furthermore when inflation goes up so does the cost of living (i.e. prices on goods and services go up) which hurts the poor and anyone on a fixed income. Rich people generally can negate the effects of inflation by investing their money in order to keep it moving within the economy via investments and thus generating more wealth for them as time move forward but lower income people either do not have this options to take risks or are not financially knowledgeable enough to understand why they should be investing.


On the other hand deflation would actually promote savings and help those on fixed incomes because of decreased prices of goods and services. However deflation can be a job killer and can also compound debt by deprecating the initial value a loan or investment. So it can also act as an unseen tax on any new investment which would decrease demand for loans or availability of investment dollars in the economy.

Neither scenarios are optimal.
Click to expand...

You pay tax on your savings account?

LOL at OP> "Do you favor an impossible text-book state of stability, or a real-world state of managed chaos?"
 
Anarchist420 said:
Not really. If the money supply in circulation were to double in two years, my parents' savings would be halved quite quickly. If the money supply were to go down by one half, then I wouldn't ever have to work provided taxes were a little bit lower than they are now. Inflation hurts people who save, not poor people.

Inflation via fractional reserve banking helps the rich the most. Interest is charged on credit rather than on money. With a central bank, that makes it hard for banks to lose money.

Inflation and central banking helps the investor class like no one else.
Click to expand...

You are fvcking clueless as usual. One of the primary mission of central bank is to manage inflation. The only reason US fed is in the money supply expansion mode is because current US inflation is under control.

Without central bank and their management of money supply, there will even be more severe inflation/deflation peak and trough.
 
Anarchist420 said:
Yes, but the booms weren't as severe.
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The booms and busts of 19th century America were every bit as exuberant and brutal as the 1920s-30s.
Anarchist420 said:
Yes. People were more free in Medieval times than they are now.
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Which people? The vast majority certainly weren't.

There is a reason we teach children to read before we teach them to write. You should practice more of the former before attempting the latter.
 
Anarchist420 said:
Not really. If the money supply in circulation were to double in two years, my parents' savings would be halved quite quickly. If the money supply were to go down by one half, then I wouldn't ever have to work provided taxes were a little bit lower than they are now. Inflation hurts people who save, not poor people.
Click to expand...

OMG, you are such a leech!
 
Based on his postings, I've come to the conclusion that the OP's political philosophy has nothing at all in common with anarchy. Everything he has written points to South American or Spanish style fascism as his utopia.
 
LegendKiller said:
Are you agreeing with him? Conscription has been prevelent throughout history, as have castes and classes. Defining "Free" as anarchy is insane, as all anarchists are.
Click to expand...

No. His level of idiocy for this thread has reached the level such that it cannot be reversed, thus it's best to let the thread die.
 
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IronWing said:
Based on his postings, I've come to the conclusion that the OP's political philosophy has nothing at all in common with anarchy. Everything he has written points to South American or Spanish style fascism as his utopia.
Click to expand...
Fascism is socialism, so I'm against it. I also think it's stupid and shitty that Spain refuses to allow the Basques the right to their own country.

However, just because I view a monarchy as less poisonous than a democracy doesn't make me a fascist.

If a stateless society can be achieved, then I guess an Articles of Confederation would be best, except only having the Free and Independent States being free and independent monarchies rather than republics.

Large, centralized states can't preserve liberty, so it's best to end the centralization.
 
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