Originally posted by: Obsoleet
Originally posted by: LegendKiller
I never said this would "save" the economy completely. It'll soften the landing and make sure we don't crater into the ground.
Thank god laissez faire economics is gone. It's a retarded idea pushed by people who are sucking off those who want to scam society.
The money won't be "printed". Despite what you think, the dollars raised will be invested by somebody else, such as the Chinese.
Only a complete fucktard, who knows nothing of finance, doesn't get the difference between money invested and money printed.
What's your problem with staying civil? Are you unable to communicate without attempting to be condescending and calling people "fucktards"? Are you 12?
I realize you know nothing about finance how you act as if you understand it all, yet don't really say any pertinent information other than refute blankly what I'm saying.
You're just one of those highly informed/intelligent people, who can't manage to articulate your argument, I'm sure!
It doesn't matter if the money is borrowed or printed, it has the same effect on the value of the dollar. Despite all your quips, and the manner of which you hold yourself in high esteem you failed to note that more dollars out there = a drop in the valuation. It doesn't matter how you get more dollars in circulation.
Please, using some type of righteous indignation and claiming highground is just silly, but not as silly as claiming I know nothing about finance. Do you have an MBA in finance, or a CFA charter? Do you work in finance or economics? Or are you some sort of internet-know-it-all blog educated fool? Inquiring minds want to know.
But hey, this should be fun, if anything, it'll make you look like an utter fool even more. So I'll give our "leet" friend the benefit of a plethora of doubt, and enter into a debate far above your head....
No, it doesn't have the same effect. If it's money INTO the system, then that money has representative value, an investment. Investment is not the same as printing out of thin air.
For example, if I have a company that has 100 $1 bills, which is financed by $100 bond, then that bond is worth $100 and my currency has par.
If, suddenly, I print 100 $1 more bills, but do not raise money, then each bill is only worth, backed, by $100, so they are now worth half as much.
However, if somebody else gives me $100, through another bond, then I have 200 $1 bills, and 2 $100 bonds backing them.
Do you not quite understand that? Do you really not see the difference?
Our currency has declined due to several reasons. One is PPP, since our interest rates differ, then PPP dictates that the cross currency flows, demand the same price for all goods. Additionally, since the return on our investments is lower, then less people want to invest. That lowers demand for our currency, dropping the value. Other countries (europe for example) maintained higher interest rates, thus, demand for the Euro accelerated.
Finally, the relative values of currencies are also driven by economic output. Provided that economies keep going, spurring future demand for the currency, then the currency spot rate will go higher. Many people thought the US was going into decline, alone.
This was called "delinking", many thought if the US would go down, then no other country would. This was proven incorrect, moreso now, since European economies are in recession, China is getting hammered, and Japan is getting smacked by vehicles alone. This, all in concert, as our own manufacturing system is booming because our currency has been valued lower, spurring demand for goods as they are cheaper.
Now, as European economies, go down, they will have no choice but to cut rates, re-valuing the dollar higher, which it has done, more than 10% higher, in the last 2 months. This will continue as the prognosis becomes better.
Isn't it amusing that, despite this facility becoming near reality, the dollar hasn't fallen much? Why? Because people know it'll keep the economy going, spurring demand for dollars, offsetting any inflationary risks.
Some may say that the market isn't pricing the facility in. However, when the facility was almost certain, the dollar didn't collapse. When McCain scuttled it, it didn't jump up. The market isn't dumb and would have been pricing in probability very quickly.
Thus, by simple deduction, the market doesn't think this will, net net, affect the dollar a whole lot for the aformentioned reasons.
I await your awesome and, sufficiently, adroit reply, which, I am sure will be highly structured, include a lot of good premises, and counter every point with sound logic based in reality.
I am sure I'll be unsurprisingly disappointed. But hey, miracles happen.
Only those interested in identifying with the Republican-brand have reason to vote for that traitor to the GOP.
Facebook
Twitter