So do you not think the nation is $17 trillion in debt then?
I don't think it, I know it. I understand you want people to believe that because a nation can put some ink on paper that 'debt' does not exist. That isn't the case.
Its not an assertion, its fact. The Fed currently now has about $4 trillion on its balance sheet- this money isnt in circulation. And sooner or later it will have to unwind that balance sheet. And when that happens expect a deduction of at least 24% of the US GDP.
The Fed's Balance At The End Of 2013: $4 Trillion | Zero Hedge
Fed
Do yourself a favor and stop butting into the middle of a debate and take one thing out of context and treat it as another, thats just trolling because I was talking about chartalism and how it affects hyperinflation. Keep it up and I'll ignore you from now on.
On second thought you are just trolling. Goodbye.
Wise decision IMO...I started ignoring him a few days ago.
All he does is spew forth his own ideas (whether they make sense or not) and seems to NEVER back them up with facts.
I think you are right...he is trolling.
Production Capacity =/ GDP. You took his argument and changed it to something that fit yours.
Exactly. Like a noob I fell for his bait. I need to start ignoring people on the internet who think they are economics experts and yet dont know anything about inflation or balance sheets.Wise decision IMO...I started ignoring him a few days ago.
All he does is spew forth his own ideas (whether they make sense or not) and seems to NEVER back them up with facts.
I think you are right...he is trolling.
If we go by your reasoning JP, hyperinflation only occurred in 1922 after production stopped- yet Germany was already experiencing over 100% inflation by September 1919 while production in the Ruhr was still ongoing and even when Germany was paying their first treaty installments. So loss in production alone doesnt account for it.And all you have to do is understand what happened first.... Printing money? Or was it drop in production. If you are honest with your history you have to say a drop in production, here are the historical facts:
"Hyperinflation and Weimar Germany
Weimar Germany had greeted with total horror the financial punishment of Versailles. If Germany had paid off the sum of £6,600,000,000, she would have remained in debt to the Allies until 1987 !! However, by signing the Treaty of Versailles, she had agreed in principle to the issue of reparations and in 1921, Germany just about managed to pay its first installment of 2 billion gold marks. Weimar Germany was allowed to pay in kind (actual materials) as opposed to just cash. Most of this 2 billion was paid in coal, iron and wood.
In 1922, Weimar Germany simply could not manage to pay another installment. This the Allies did not believe - especially France where anger towards Germany still ran deep - and the German government was accused of trying to get out of her reparations responsibilities. This apparent refusal was only four years after the end of the war, and the attitude of the public towards Germany was still very hostile - and not just in France.
In 1922, French and Belgium troops invaded the Ruhr; Germany’s most valuable industrial area. The French and Belgium troops took over the iron and steel factories, coal mines and railways. Those Germans who lived in the Ruhr and were considered not to be co-operating with the Germans were imprisoned. Food was taken. That this action by the French and Belgium broke the rules of the League of Nations - which both belonged to - was ignored by both countries. France was considered one of the League's most powerful members and here she was violating its own code of conduct.
This is where production stopped
Weimar’s government responded by ordering the workers in the Ruhr to go on strike and it ordered all people in the Ruhr to passively resist the French and Belgium soldiers. This meant that they were not to openly confront the French and Belgium soldiers, simply that they were not to help them in any way whatsoever. This lead to violence and over the next 8 months of the occupation, 132 people were killed and over 150,000 Ruhr Germans expelled from their homes.
The order for workers to go on a general strike may have been patriotic but it had disastrous consequences for Germany as a whole. The Ruhr was Germany’s richest economic area and produced a great deal of wealth for the country as a whole. The huge Krupps steelworks was there. By not producing any goods whatsoever, Germany’s economy started to suffer.
This is when printing started. Which was after the strike!
The striking workers had to be paid and the people expelled from their homes had to be looked after. To do this, the government did the worst thing possible - it printed money to cover the cost. This signalled to the outside world that Germany did not have enough money to pay for her day-to-day needs and whatever money may have been invested in Germany was removed by foreign investors.
Such a drop in confidence also caused a crisis in Weimar Germany itself when prices started to rise to match inflation. Very quickly, things got out of control and what is known as hyperinflation set in. Prices went up quicker than people could spend their money."
Hyperinflation and Weimar Germany
I don't care what the price of gold was, only gold bugs do. Inflation is measured by the cost of living, and that didn't start to take off until production faltered. So stop trying to change the argument, no one cares about gold prices:If we go by your reasoning JP, hyperinflation only occurred in 1922 after production stopped- yet Germany was already experiencing over 100% inflation by September 1919 while production in the Ruhr was still ongoing and even when Germany was paying their first treaty installments. So loss in production alone doesnt account for it.
So ignore anything that contradicts your theory? OK. :roll:I don't care what the price of gold was, only gold bugs do. Inflation is measured by the cost of living, and that didn't start to take off until production faltered. So stop trying to change the argument, no one cares about gold prices:
Weimar
Let me ask you this question:
What is inflation?
A Finite amount of dinero (adjustable) chases a Finite amount of Goods.
"Weimar Germany was allowed to pay in kind (actual materials) as opposed to just cash. Most of this 2 billion was paid in coal, iron and wood."
So the Finite amount of Goods (Coal/Iron/Wood/etc[other 'kinds']) were being funneled out of Germany.
Where were Germans goods going? Not Germany. But the supply of GERMANY remained Finite.
But the German demand for these goods stayed *roughly* the same.
What happens when there's a Shortage...
Wait...
No.
Prices CANT go up when there's a shortage of goods.
-------
Post 1918 (Armistic)
We can look at the strength of the currency, as the Euro Debt Crisis, as a preference of investors/money consumers to have a Fiat currency versus a Specie currency.
So, would a weak Confidence IN A GOVERNMENT JUST DEFEATED IN A GLOBAL WAR!? have that odd affect of making Investors skirmish?
Investors don't play any part in deriving the Demand for Currencies.
Thus, they CLEARLY have no affect on the exchange rates and relative currency power (read: Devaluation, read: Inflation)
And seriously, who gives a flipping F*** about investor confidence?
And let's ignore the fact of Investors worrying about Germany paying reparations in the first place.
----
But Seriously.
The Allies won both World Wars.
Victors write the History.
Therefore, Allies were Knights in Shining Armor, glorious Peoples of God, Country and even Defenders of the Globe!
Hyperinflation was already there, prior to drop in production.
Let me ask you this question:
What is inflation?
A Finite amount of dinero (adjustable) chases a Finite amount of Goods....
Inflation is caused by an inadequate supply of goods to fill demand.
Or maybe I am just not understanding your point.
there are good ways to spend government money, and there are bad ways.
Yes, we get it, for over 100 messages, we get it. If government spending is the idea of the left, it is good, if it is the idea of the right, it is bad. You can use a lot less words and just say that.
That's not it at all. There is nothing partisan about this. For instance, I think the Dubya administration was better for the economy than the Clinton administration. That doesn't mean that I agreed with everything Dubya spent money on. But Clinton ran a surplus (which probably led to the 2001 recession), and Dubya turned that back into a deficit, and he spent a bunch of money on wars. I would have preferred that money was spent on infrastructure, but defense spending is better than no spending at all.
That's not it at all.
Yeah it does. The mere fact that you put forth the whole 'clinton surplus' thing shows it. That was nothing other than moving money around to show a false result. Nothing was paid off or even down. It was governmental BS and gaming.
This is interesting.
I would like a Link, Please.
I Love Clinton and this would affect my view of his Administration. It would make me sad, but it would be necessary.
Deferred payments you seem to imply at some level?
I hate to nit-pick.
I don't even know why I feel compelled to do it.
But I would rather have had the military's increased budget in a tax surplus or education. I know if it was a tax surplus it would probably just lead to an unnoticeable deflationary pressure and no multiplier growth but I sincerely believe the government would have found *some* way to spend it (lol) if not just to buy votes. I do believe some recessions are necessary, corrective, measures for an economy and the dotcom bubble was just that. We got too feisty.
Again, sorry for the nit-pick XP
This is interesting.
I would like a Link, Please.
I Love Clinton and this would affect my view of his Administration. It would make me sad, but it would be necessary.
Deferred payments you seem to imply at some level?
Norway's total tax burden is 45% of gdp. That's the amount of GDP to give away all those 'free' things. The VAT is 25%, personal income tax is in the high 40's. All that on top of corporate taxes and a direct wealth tax.
Gee, this sounds kinda familiar: "The Norwegian tax system is based on the principle that everybody should pay tax according to their means and receive services according to their needs." Where might I have heard such a thing before?
Do the citizens believe in/follow the laws of Jante?
Thanks, but no thanks. I prefer our system, imperfections and all, as I believe people should strive to improve themselves and their situation, and have the ability to do so.
LOL, this is hilarious, you keep saying that a welfare state that guarantees a living wage works yet all you can come up with as an example is Norway. Yet Norway a) doesnt have a minimum wage and b) has oil revenues to pay for its government spending. All the other welfare states like Denmark, Sweden, France, etc. are all just hanging on, most are in the red. So its apparent that the only way a welfare state can have a surplus is if it has a massive oil industry like Norway. Pretty obvious.
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