This isn't the first time Tice has gone moonbatty... He has a long history of saying silly things for his own benefit...
The argument I've heard is that the Fed is manipulating the CPI to make inflation seem much lower than reality. I do not know what the justifications for this are, as I don't know near as much about economics as so many of you; I'm sure guerilla or tesla will explain that argument.
I don't know , my grandfather only had a high school diploma and he was able to , own a house, car, and have wife that stayed home to watch the kids all on one income Its pretty tough to do that in most places Its also probably way cheaper to live out where you live then most places where people live, not everyone lives in the boonies
Economist Paul Craig Roberts shows in his article "Return of the Robber Barons" that the CPI is manipulated by not including key things such as food and energy. You can read the article here, which I found to be really good:http://www.vdare.com/roberts/070801_barons.htm Near the end of the article, Roberts talks about Core Inflation and how the CPI is manipulated. The mainstream media tells us inflation is around 2 or 3%, but if they are not including energy and food, then clearly this number is much lower than the actual rate, which is likely closely to 13%. Paul Craig Roberts has a lot of credibility due to being a former Secretary of the Treasury under Reagan, and he also is an economist. Also, the cost of housing is not included as well. So the 2 or 3% inflation rate is a massive deception.
Same here, but then again, my grandfather did fight in WWII and had the benefit of the GI Bill, and other incentives to help.. Couple this with the fact that he lived through the depression, and as such not only pinched but was extremely conservative in what he spent money on.. Today we want more, so we work more... I think out wants have changed, not our needs... If we did not want as much, and only relied on what we needed, we'd all be like our grandfathers... My buck buys a lot more than his ever did...
As I recall the gold standard basis for valuing dollars basically ended in the early 1970's. At that time it was blamed for high inflation of the period. Inflation within the US was relatively high into the beginning of the 1980's. It was hit hard during oil price spikes at the end of the 70's and into the early 1980's. Since then American inflation has been dramatically low for a very long time. Prices go up naturally. Prices in the 1800's were higher than the 1700's. Prices in the 1900's were higher than in the 1800's and prices in the 2000's are higher than in the 1900's. The rate of inflation is key. Since the 1980's the basic rate of inflation in the 3-5% range has been dramatically low. As said before I wouldn't be surprised if the current govt is manipulating reporting of the rate of inflation. It seems higher than what is being reported. The reference to telecom as something that was dramtically impacted by efficiency and improvements in technology dramatically lowered the costs of calls. If monthly service is higher...that is different...but the cost of calls, domestically, internationally and all types of communications over telecom lines has dropped remarkably since the early 1980's. This whole thing about the gold standard brings us back to something that was found wanting about 30's years ago. Frankly it scares me. There have been plenty of financial crises since then and all have been worked out over time. The potential credit crunch from bad real estate loans is similar to what happened at the end of the senior Bush administration in the late a=1980's and into the early 1990's. Some differences include that this one is well seen and anticipated. That one struck suddenly without warning and was the result of enormous and endless bad loans from financial institutions. It resulted in a sudden and immediate severe cut and elimination of lending across the board and had a severe impact on the national economy. This potential problem has been already identified and the fed and lending institutions are already gearing up for the problem. That is better. The potential severity of the problem will play out over time as more bad real estate loans go bad. Nobody knows the extent of the severity at this time. The American debt issue is large and relatively unprecidented. New debt has escalated during the 2000's. Most of this debt is held by foreign nations that may for business and political reasons stop buying American govt. debt. If that happens that will drive up the costs of American debt and create problems. Over a long time period the American economy has shifted from a production to a consumer economy. That is a potential problem. All of these problems are somewhat apparent. How to deal with them are the issues. Somehow I have a hard time believing that a methodology that was dropped 30 years ago and longer for significant deficiencies is where we should be heading for solutions.
Earl, the gold standard was dropped in 1971 with the collapse of the Bretton Woods agreement. The government had pegged the value of one ounce of gold to $35 US, which did not reflect market fluctuations or demand. It was not a "true" gold standard by any means, merely a managed one, which again is the problem when the FED or government sets artifical rates. The cause for the high inflation of the late 70s, early 80s was the cost of the Vietnam war. Every time this country goes to war, the economy suffers for it. Wars are not cheap, and we are paying for the current one, whether you believe it or, with inflation of the money supply and foreign debt. And the piper on that will come due long before our grandkids assume control of the system. It could be as soon as 5 years. A true free market is allowed to inflate and deflate. To self correct. You have to believe in the power of the market to go where there is value and abandon things which have lost or do not have value. This is the primary argument against a managed economy, where value is set arbitrarily or according to political agenda. It doesn't truly reflect the will of the consumer or investor. There is no greater example of this than the FEDs manipulation of interest rates to ease the stock market, or the 1% overnight rates to facilitate the housing market boom. I keep hearing about how the Gold standard is "old" or "antiquated". How it is an idea from 30 years ago, as if the fundamental theories of the market, supply and demand, inflation and deflation, mal-investment and credit are all new things, never before seen in history. Utter nonsense, and it's apparent that few people bothered to read the History of Money that I posted. Those that fail to understand history are doomed to repeat it.
We're frequently on opposite sides of the argument, but I do respect you, so please do not consider this an attack. But I truly wonder who the people are, and from what background and means they come from that argue that the government figures on inflation are legitimate and reflect the real world costs for every day people. Because for those of us in the trenches, or subsidizing our family members in the trenches, the cost of living continues to go up, while good jobs are harder to find, and require a larger capital investment in education to attain. At the same time, we see other nations gaining in wealth, and one has to ask, where is this new found wealth and standard of living coming from? Was it always untapped or has there been a transfer of wealth not only from the middle and lower class to the upper earning spectrum as well as a diversity in the global portfolio of the world's largest corporations to areas of greater profit, with less environmental and humanitarian legislation, and much lower wages and standards of living. I know from my personal experiences, that the Chinese government provides masses of poor labor to their eastern industrial coast for only the cost of food and basic lodging. No tangible wealth is created for these workers, only the burden of subsistence has been transferred from that socialist government to the foreign investors and their proxy companies. I hope, that I am wrong. I hope things will correct and everything will start to turn upwards and people will not have to go through hardship. But my hopes have to meet me halfway intellectually, and it's hard to see anything but a lot of struggle and strife coming up unless we change the monetary policy, and then the fiscal policy to suit.
We are heading in that direction here in the U.S. A lot of Americans are living paycheck to paycheck, and in my book, living paycheck to paycheck means that you only exist for the purpose of being a cog in the machine, feeding the system, with no real hope of ever attaining wealth. I find this type of existence to be pretty dim, to say the least. I firmly believe that those in this forum who continue to downplay the problems of the U.S. economy are those who either have a high income, or those who are ignorant and naive as to the history and true nature of banking and the economy. Right now, someone making $100,000 per year is unlikely to see the effects of the economy. But talk to someone who is living paycheck to paycheck, or who has lost their job due to downsizing or outsourcing. In addition to this, foreign workers are now being bought into the U.S. to work jobs. You know what? I get the clear impression that someone, somewhere, has decided to wage war against the American worker. With outsourcing, inflation, insourcing, and the current real estate crisis, those who want to become Middle Class or Wealthy must be prepared to wage economic warfare. It pisses me off that it is hard to go to college now without taking out a loan. And I see people here at DP defending the use of borrowing money. Can't they see that this system is designed to put you in debt, make you a slave to the system? Even if you go in debt to go to school, with the global economy being the way it is, there is no guarantee you will get a job after graduation. Now is the best time in history to own your own business, be out of debt, and most important, read and get your information from sources other than the mainstream media. Your economic future depends on it.
I would also like to say that the Internet is the last refuge in today's chaotic financial world. The Internet is pushing the limits of technology, and will continue to do so. If you want to see a true free market in action, just go to the buy/sell section of Digital Point. There is your free market. Thus, because of the wealth and prosperity that the Internet is creating, it is no wonder that the you hear more talks of government regulation and taxation. The reason for this is because the government, and most importantly the groups that control, want to wipe out all competition and destroy the middle class. For them, a free market can't exist. This means the Internet is a direct threat to everything they stand for. This is why online gambling was banned last year. This is why you hear Bill Gates talking about taxing email, and that is why you hear people talking about Internet 2, or a new "more advanced" Internet. This is also why you here AT&T and other corporations talking about ending Net Neutrality. The Internet is the last refuge of a true democracy and free market, and the government/globalist must take over it to fulfill their long term agenda. The Internet is it, we let these sharks take over the web, you can kiss all hope of the future good bye, because if global corporations win, and take over the web, the Internet is going to self destruct. The Internet is the bane of those seeking to restrict information, free speech, and the continuity of a digital free market. I continue to hear some of you in hear attack Ron Paul, but if you have an online business, and you value the Internet as a tool of freedom, you'd had better think hard about electing him president, because I can assure you, just about every other candidate will go after the Internet the first chance they get. Believe it.
Someone with an educational background in economics. The poor in 1913 were impecunious and their poverty does not compare to what we call poverty today. Inflation is taxation on idle money, and moderate inflation is good. Gold standard under full-reserve banking will kill the poor. You are asking for a zero-sum economy; an ideal economy for the wealthy; a game of monopoly. You are asking for an economy where wealth simply gets transfered and never created. The rich will suck the money out of the economy, probably unwittingly, and the system will allow that to happen. You are naive to think that a simple change in the economic system will save the poor. Poverty is a social issue in the US, and it is becoming a culture. What we need is a leader who can address the issue and make an effort to resolve it. This would be far more difficult to do under the gold standard combined with full reserve banking because the amount of money that the government can work with would be extremely limited.
I've already replied to this. There does not need to be only one currency that is based on a commodity. What needs to be removed is the profit and taxes to sell and acquire that commodity. The market will decide if Gold, Silver, Oil or pork bellies have value. Remember, value is not mathematical. It is ordinal. The assignments of units of measurement to decision making are inflexible and impossible to report accurately. FYI, the rich are already sucking the wealth out of the economy by having a mono-currency system based around bills of credit with no intrinsic value. You are being arrogant to assume that I am requesting a change for the poor. There is no such thing as equality in life, unless you are prepared to share/divide your lifestyle with the millions of people in this world who have a much lower standard. In which case, that is your decision, you have no moral right to impose forced charity on my by coercion. My morality comes from me, not from laws or force. Poverty is becoming a class. A debtors class of wage slaves. I'm wondering how prosperous our system of taxation, inflation and entitlements is if there is a growing lower class. History tells us that this occurs when there is a transfer of wealth, so perhaps you should start looking at the current system a lot more critically. There is a failure in your last quote, and that is the belief that government holds the answers for poverty. It does not. Civil servants live better than the people they serve, and typically perpetuate the bureaucracy whose inefficiencies lead to lesser results. The more the government provides, the closer you move to socialism. And every socialistic system has failed economically, because value cannot be determined by the state, nor can supply, demand or equity. That is the purpose of a free market.
This sounds like the current economic if you ask me. The Rich are already sucking the money out of the economy, because they get to use the new created money from the Fed. Also, during a bad economic situation, I don't know about you, but I would rather have my money in a full reserve bank rather than a fractional reserve bank that won't be able to give everyone their money back once they all line up to get it out. Fractional reserve banking is great until there is a panic, and people start lining up to get their money out... By your post, it doesn't seem like you understand how inflation and a central bank contributes to misery and poverty. When you have a central bank, someone with lots of money, power, and influence can take over that bank and use it to further their own aims. Those aims can be detrimental to the masses. The Fed is private, it is a corporation, it is not a part of the federal government, that means a corporation has control over the U.S. economy and money supply. A corporation cares about one thing, and thats profits. Ben Bernanke or Alan Greenspan who came before him could care less about American prosperity. This is why Andrew Jackson fought against the bank, and blocked them from being established. A central bank created by the rich would ensure that the rich maintained their power, and they would have a monopoly on the creation of money, and they could retard the growth of a Middle Class to threaten them. The Fed causes inflation. They print out too much money, and then they alter the interest rates. It is all a sick game. Gold and Silver are powerful because they dramatically reduce the rates of inflation, and you pay a fair amount for goods or services. This isn't about saving the poor. There will always be poor people in any society. This current situation is about maintaining a free market where everyone has a "chance" to rise up the social ladder if they work hard and work smart. We live in what I would like to call a "limited free market right now." I call it that because the government has subsidized large corporations, while making it harder for small business people to operate. Sure, you can start a business today, but it is harder, but thanks to the Internet, it is a lot easier than it would be. A free market is a friend to the poor, because the poor can rise up into the Middle or Upper Classes.
I don't advocate brainless spending by the government; I am in support of Keynesian countercyclical fiscal policy. We can cut spending and have a more efficient fiscal policy under the current system. There is absolutely no need to change our currency system to achieve this. If anything, we should have a gold standard with fractional-reserve banking, or fiat currency with (close to) full-reserve banking, but never gold-standard with full-reserve banking. I can't support a system that will eventually lead to a dead end.
This is almost paradoxical, because with the current system, over spending will always be a problem. When you have a central bank that can print money out of thin air, and then loan that money to the government at a certain interest rate, you have a monetary system in which the government will have a license to over spend, because there is nothing stopping them from doing so. When they want more money, all they have to do is loan it from the central bank. With reserve banking, the government can't spend more than it has in reserves. Gold or Silver keeps the government in check. If Americans today could convert their paper dollars into Silver as they once could, the government would be kept in check as far as how much it could spend, because they would only have so much gold and silver to back up that paper money, and if they print too much paper money, it would quickly become clear, because there reserves would not be able to back it. Why do you think an economic system based on the Austrian Economic model will lead to a dead end? What is going to lead us to a dead end is the current economic system. We have a private bank loaning money to our government, which means that bank, not the people, control that government. This is why the government is in so much debt, and it can't keep borrowing forever. Once you borrowing power runs out, then what? Gold, and especially Silver, is the currency of the people. They are both honest metals. History shows us that during times of war, governments always debase their currencies. Why? Because without doing it, they would not be able to pay for the wars without heavy taxes, which is unpopular. But debasing the currency always leads to poverty eventually.
The Fed was established in 1913, and there is absolutely no reason for it to exist other than to rob the American people of their wealth. I don't know if you guys realize this, but America was a prosperous nation prior to 1913. We did not have an income tax, and we did not have a central bank. The treasury, which the founding fathers authorized, was responsible for dealing with the money supply. And it worked. Americans were conservative and very wealthy. I laugh today at people here at Digital Point who are proud of the interest rate they got for their mortgage. What a joke, there was a day and time in this country where a man could easily save up for a house or a car. Today, people have to borrow for everything, become slaves to the banks and credit card companies, and then, they are so brainwashed by the credit based system that they are happy to have gotten a "low interest rate." They think it is a good deal. No, a good deal is not being in debt, being able to pay for the things you need and want out of pocket. The people who established the Federal Reserve are powerful old line families that created it for the simple purpose of destroying the American Middle Class, and though it has taken time, today it has become obvious that there mission was largely successful. Anyone who doesn't believe me can reference this thread I started. Americans owe almost $1 trillion in credit card debt. Now that sounds like a "real" rich nation to me:http://forums.digitalpoint.com/showthread.php?t=546843 Anyone here who thinks the Fed is just a benevolent institution created to help the U.S. economy may want to check out this book from Amazon called The Creature from Jekyll Island:http://www.amazon.com/Creature-Jeky...d_bbs_1?ie=UTF8&s=books&qid=1194909688&sr=8-1 This books shows how powerful American families conspired to create the Fed, and institution which would allow them to control the U.S. government. I've said it many times, and I will say it again: Bill Gates is not the richest man in the world. Carlos Helos Slim is not the richest. The richest person in the world is the person who owns the central bank, the Fed. Think about it, it is a private bank, that means the people who own it make out loans to the U.S. government and charge them interest on it! These people are probably trillionaires!!!!!!!!
"The performance of the American economy over the past 10 years, particularly the period since 911, has behaved remarkably well; it's been fluid, it's been adjustable, and I think a very important part of credit for that does go to the Federal Reserve and its stable monetary policy... You read the newspapers and you think the world is going to hell; you think the economy is doing badly, and yet the truth is that we've never in our history had as productive economy as we do right now. The average per capita real income is higher now than it has ever been." - Milton Friedman (R.I.P) 2005. He also mentions that our inflation has been around 2%-3%, so now you know that people with an educational background in economics, from myself all the way to Milton Friedman, accepts that figure. We do not dismiss energy prices when we evaluate the health of the economy, but we do not consider them when we discuss inflation due to the volatile prices.
We have a problem then, because Paul Craig Roberts, an economist and Secretary of the Treasury under Ronald Reagan, says that the CPI is manipulated by excluding food, housing, and energy. Both can't be right. I don't have a degree in economics, but I read the works of people who do, and I also have common sense. I know for first hand experience that Roberts is right because, I look at my power bill this month, and it is higher than it was three years ago. I go to the store and buy a gallon of milk/food, and it is higher today than it was three years ago. My rent this month is higher than it was three years ago. Housing, energy, and food, I just mentioned the very three things which are not included in the CPI. Yes, the inflation is 2% when you exclude these things, but these are the very things that have continued to increase. Since my power bill, rent, and food have increased in price, this means I have to work harder to make ends meet. Despite what Mia and others have said, for me personally, my dollar doesn't go farther today than it did in 2004, it actually buys less. This is the effects of inflation, and it eventually causes a lot of people to become poor. I do well because I save a lot of money by being creative, thrifty, disciplined, and determined, getting rid of bills I don't need. I also purchase gold and silver, and have my own business. To top it off, I'm single with no wife and children, and that makes things even easier, as I only have to feed myself. But American families are suffering, they are in more debt than ever. I don't understand how you can say our economy is good when Americans owe almost $1 trillion in credit card debt. I consider debt to be slavery, how can that be a good thing?