Home Music Articles Forums Blog Chat More...      

add to bookmarks
Prev Topic | Next Topic

Author
Posts
(Read 30778 times)
Komrade K
Forum Full Member


Registered: 08/02/05
Posts: 927
Location: Whitstable, Kent England
 
Re:Brace for impact
Saturday, November 14 2009 @ 07:47 AM CST

Quote by: MotherofMeursault

Furthermore, hoping that the rate of healthcare costs will keep pace with inflation is a mind-boggling concept. Inflation is the enlargement of the money supply. The US dollar is counterfeit currency because it isn't backed by anything more than the promise of the government to be a responsible steward of its relative 'value'. The Federal Reserve prints the phony money at an unpublished rate which is significantly higher than the rate it admits to. The whole concept is corrupt!



I'm finding this all a bit dogmatic and as such not very enlightening or useful. Quite clearly there are other factors which drive inflation rather than increase in money supply (although I accept it can be an important factor particularly with hyper inflation). Now I'm defining deflation from the point of view of an spending power particularly from the point of view of households and a key factor influencing this is supply and demand. So for example (given constant demand) failures in staple crops, factors limiting the production of oil, rising overseas labour costs or shortage of housing (pushing up rents or purchase prices) will all serve to constrain household budgets. Other important factors can be foreign exchange, fiscal policy and central bank interest rates.

In other threads the notion of a gold standard has been discussed and found wanting. Largely because the gold standard has failed for many currencies on numerous occasions - idealistically it might appear to be a good idea but in the real world it's screwed. Besides which gold is a freely tradable commodity and its 'value' will fluctuate which means that the value of the currency it's backing will fluctuate. That's unless some authority is created to control the supply of gold which might run contrary to a constitutionalist view point - and, God forbid, might lead to foreign intercession in the affairs of the US (because we live in a global economy these days) should other countries join the gold standard.


Quote by: MotherofMeursault

And not for nothing, but the 'other devil you don't know' in this case is insurance-free healthcare: no government, no insurance, no co-pays, just payment for services on the spot. I am using it for all my "elective procedures" and "pre-existing conditions" and I recommend it highly.





Which is fine if you can afford it but many people can't and for them we need a healthcare system (that is we do unless you simply don't give a f**k!).

KK
MotherofMeursault
Forum Full Member


Registered: 09/28/08
Posts: 380
Location: , United States
 
Re:Brace for impact
Saturday, November 14 2009 @ 08:25 AM CST

Quote by: Dadai.2
Quote by: SmokeyVW
Quote by: MotherofMeursault
...When the entire market drops that way, it is a correction of the value of the dollar itself. In that case, the $820. represents the unrealistic inflation of the value that is now 'corrected' to $180. ...

I guess I don't understand that. There are plenty of dollars circulating that are not in the stock market. Those thin out the effect of dollars in the stock market. I guess? I dunno.

As a counter example, consider the two to one ratio when the Dow was around 14000 in fall of 2007, and then when it was around 7000 in spring of 2009. Now consider the price of a loaf of bread (or anything else) in fall of 2007 compared to spring of 2009 - I don't remember any prices doubling. Shouldn't prices have changed dramatically if the value of the dollar corrected?

Quote by: MotherofMeursault
... On the subject of 'diversifying', the very best investment strategy I've ever seen is Harry Browne's 'Bulletproof Portfolio' from his book, "Fail Safe investing":
http://www.trendsaction.com/books/HarryBrowne/FailSafeInvesting/index.php?ulaCartSID=EHJUrJjVkUcawwQerfJlbqEBT1258162576
It is very simple, needs monitoring only once a year, and shows a historical increase in value of roughly 9% per year. You won't make a killing with it, but you will protect money you 'cannot afford to lose'. ...

Thanks for the info!


I fear I'm derailing the thread to another subject. Unless this is actually a debate club thread. Smile



No, not at all. Easy money (credit from below market interest rates from the Fed) goes to the hot markets, pushing up price of stocks, where quick money can be made. Bread isn't such a market. But the power of greed causes people to ply their money into a stock that is rising in hopes of riches... until the bubble bursts. Then everyone rushes for the exit. Only those who know the game get out in time to take their profits with them. It is called "the greater fool theory."

D



Jack is correct, the extra dollars the Fed has produced have not gone into raw materials, they've gone into the stock market. In 1990, the Dow was 2500; by 2007, it was 14000. That was all inflated money. In fact, the Fed's inflation perverts the economic signals that exist in a healthy economy: the price rises that would signify a genuine demand for those goods and services turn out later to have merely been the result of extra money flowing there.
The other piece of that puzzle is velocity, which is the speed at which money changes hands. A low demand for dollars (meaning people are more willing to spend their dollars: high velocity) has the same effect as inflation: prices rise to meet the flow. A high demand for dollars has a deflationary effect as people stop spending, so prices stabilize. The credit collapse scared the shit out of everybody, and consuming (the lifeblood of the Keynesian economy) came to an abrupt halt. Low velocity = price stabilization. There is an additional wrinkle as well: for the last 30 years at least, the US has ceased being a net producer, and has been selling it's Treasury Bills (promissory notes on future production??) to foreigners in exchange for their money and goods (wealth). We did not build any income producing factories with that wealth, we squandered it on big cars and big houses and unwinnable wars. Those people are sitting on a lot of dollars, and their velocity affects us as well. If they choose to trade those dollars for real wealth, it will produce price increases here, even if we are not spending our dollars!

This is clearly a very bad state of affairs, so the question of "How will the government pay for the healthcare plan?" is not to be brushed aside. If they print more dollars they risk triggering an inflationary depression in the US as the world dumps its dollars. If they try to borrow, foreign governments are going to want better guarantees on the loan (access to our raw materials at bargain basement prices). They can raise taxes, but with unemployment at 10%, who will pay them?


MotherofMeursault
Forum Full Member


Registered: 09/28/08
Posts: 380
Location: , United States
 
Re:Brace for impact
Saturday, November 14 2009 @ 08:46 AM CST

Quote by: Komrade K



Quote by: MotherofMeursault

And not for nothing, but the 'other devil you don't know' in this case is insurance-free healthcare: no government, no insurance, no co-pays, just payment for services on the spot. I am using it for all my "elective procedures" and "pre-existing conditions" and I recommend it highly.





Which is fine if you can afford it but many people can't and for them we need a healthcare system (that is we do unless you simply don't give a f**k!).

KK



So much work to do!

I still owe you an explanation of my 'liberty' comments, Komrade; I have not forgotten. Be patient a little while longer, please. And I will respond to the rest of this comment, too.


But first of all:

I am not rich. I am not heartless. I spend thousands of dollars every year on a major insurance plan that I find fewer and fewer doctors are willing to accept.

Those doctors are not willing to employ people to chase the insurance companies, nor are they willing to extend free credit to the insurance companies for the time it takes to get paid (as much as a year!!) They have simply opted out of the system, and are charging LESS for the services because their costs are lower.
A real example: I needed to have a joint drained of some unpleasant fluid, and cortisone injected there. With my insurance plan, it would have cost about $350. I couldn't find an 'in network' doctor; they were all fleeing my insurance co.. When I decided to pay for it myself, it turned out to be a $175. procedure. Not cheap, but not terrible either. Now, if I were not saddled with a crushing insurance payment (which, I should point out is LOWER than the latest cost estimates from the government), I could afford to pay for all the care I need AND have plenty of money left over.
Why the need for all this insurance, anyway? Why not simple insurance for accidents and catastrophic care, and reasonable payment for services? Certainly, before this whole mess started Americans were not dropping dead in the streets due to selfish, grasping doctors and their larcenous prices.


More later.
chronologic
Forum Full Member


Registered: 09/26/08
Posts: 338
Location: , United States
 
Re:Brace for impact
Saturday, November 14 2009 @ 09:52 AM CST

Quote by: MotherofMeursault

Why the need for all this insurance, anyway? Why not simple insurance for accidents and catastrophic care, and reasonable payment for services? Certainly, before this whole mess started Americans were not dropping dead in the streets due to selfish, grasping doctors and their larcenous prices.



EXACTLY what I say. I am a fan of fixing things where they are broken. And at the root of this messed up economy, is a fundamental abuse of the monopoly of life. It's sick, wrong, and needs to be fixed. I am generally not a huge fan of govt. intervention, but sometimes when it comes to curbing basic instincts... I wonder if it is the right application. Of course, even here I think the best solution is education. Today's education is a large proportion self-interest fronted entertainment. So... we get the results which are a natural outcome of how we apply ourselves. This quote is from me (to reference another thread) and if you know what I'm saying then you can see it fits:

"Can't tell me children of the world would choose to live in pain. Stopping human madness takes knowing who to blame. Retention comes from repetition and every day I watch them die. No one's here to stop me. I'm just killing time."

From the song "Killing time".

The point is there is something wrong at the root of the culture, which lets this stuff happen. A fundamentally numbing or maleducation which influences behaviour. I don't know WHY conscience is not stepping in here. If anything really makes me lose sleep at night it is that.

Totally independent new music: http://www.pollyputthekettleon.com
jgurner
Forum Full Member


Registered: 05/20/04
Posts: 1956
Location: The Valley, Mississippi USofA
 
Re:Brace for impact
Saturday, November 14 2009 @ 10:52 AM CST

Quote by: Ed Hannifin
Quote by: jgurner
Quote by: Rocha Malhada
[
Now all we have to do is figure out how to get everyone involved to behave according to some standard that isn't even written, set or etched in stone.



I propose uploading a program with standards of behavior into the alien microchips that the shadow government has implanted in all of our brains.






I've been warning people of the impending robot apocalypse for a very long time. We won't need healthcare once the robot overlords are in charge.
MotherofMeursault
Forum Full Member


Registered: 09/28/08
Posts: 380
Location: , United States
 
Re:Brace for impact
Saturday, November 14 2009 @ 12:59 PM CST

Quote by: Komrade K

I'm finding this all a bit dogmatic and as such not very enlightening or useful. Quite clearly there are other factors which drive inflation rather than increase in money supply (although I accept it can be an important factor particularly with hyper inflation). Now I'm defining deflation from the point of view of an spending power particularly from the point of view of households and a key factor influencing this is supply and demand. So for example (given constant demand) failures in staple crops, factors limiting the production of oil, rising overseas labour costs or shortage of housing (pushing up rents or purchase prices) will all serve to constrain household budgets. Other important factors can be foreign exchange, fiscal policy and central bank interest rates.



There is a near-constant campaign to either distract or mislead the public into thinking that inflation is a natural occurrence that the Federal Reserve is uniquely equipped to combat. Inflation is widely understood to be 'rising prices', a symptom of economic ills that requires a diligent hand to keep it under control. But the dirty little secret is:

Inflation is the expansion of the money supply. Period. It is the Federal Reserve that invents the money and injects it into the economy. The Fed is not an inflation watchdog; it IS the inflator. Each dollar it invents reduces the value of all other existing dollars, and so (after a time delay as the market realizes there are all these new dollars) prices rise to protect the value of goods.
Inflation is not rising prices; it is falling money.
Other factors (such as velocity) enhance the effects of inflation, but inflation is the culprit.


As for the rest of your comment (if I understand it correctly), deflation does not have to be an inability to spend, it can -and often is- a reluctance to spend. The Keynesian view of the economy is that it's a machine: load it up with more money, and it'll begin purring again.
But an economy is not a machine; it is an ECOLOGY. It is people with all their unpredictable and uncontrollable feelings about how things are and all the decisions that flow from those feelings. When the ecology is wounded and lies down for a while, it should be left alone to heal. The Keynesians step in with their stimulus poles and try to shock the poor beast back into action. Their repeated attempts to stimulate with rafts of money create (to further mix metaphors) a sort of fiscal fuel-air bomb of idle dollars. As Jim Sinclair is fond of pointing out, "Hyperinflation is not an economic event; it's a currency event". That is, it's an entirely avoidable event, but once set in motion impossible to stop. Sooner or later, all the bad dollars in the system are going to have to be shaken out. The more dollars the Fed pumps into the economy, the more devastating the shakeout will be.

Quote by: Komrade K

In other threads the notion of a gold standard has been discussed and found wanting.



Considering that the Chinese are hoarding gold, silver, iron, oil, coal and everything else they can dig out of the Australian soil, I think the argument is far from over.
chronologic
Forum Full Member


Registered: 09/26/08
Posts: 338
Location: , United States
 
Re:Brace for impact
Saturday, November 14 2009 @ 01:55 PM CST

Quote by: MotherofMeursault

There is a near-constant campaign to either distract or mislead the public into thinking that inflation is a natural occurrence that the Federal Reserve is uniquely equipped to combat. Inflation is widely understood to be 'rising prices', a symptom of economic ills that requires a diligent hand to keep it under control. But the dirty little secret is:

Inflation is the expansion of the money supply. Period. It is the Federal Reserve that invents the money and injects it into the economy. The Fed is not an inflation watchdog; it IS the inflator. Each dollar it invents reduces the value of all other existing dollars, and so (after a time delay as the market realizes there are all these new dollars) prices rise to protect the value of goods.
Inflation is not rising prices; it is falling money.



Very interesting. A more clear explanation I have not heard. To be honest, I have never quite figured it out, and according to your presentation, it is because I wasn't looking at it right. It makes near perfect sense.

However, I wonder if it is not that simple. As such, I have a related question... doesn't it also have something do to with the interest rate, also controlled by 'the fed'? What I mean is... there are two ways to artificially increase spending power in this age. One is to add more money. But when so many people are buying on money they don't have anyway, the other way is to reduce the cost of goods through temporal distribution. IE, lower a time-bound rate, and payments go down, IE, people have "more money". Of course, they don't REALLY. But they think they do and as sheeple they run out and spend it. Sheeple is as sheeple does you might say. Isn't this intrinsically the same thing? I thought so. And this perspective is what confuses me.

Assuming yes, in the end it makes no difference. Fundamentally it's the same issue. If you take this approach to solving the problem you are only delaying the inevitable, possibly making it worse. A year ago talking about the "fall" of our economy, though it seems frightening, I was always kind of in the camp that said "Well good. Let it fall." Because the sooner we get it over with the sooner things get corrected back to reality and we stop dancing the dance. If I was 60 right now I probably wouldn't be saying that. But I'm young enough I figure I might live through the worst of it and come out alright. But putting the personal perspective aside, it's not IF, it's WHEN. And now is as good a time (or BETTER, likely) as any.

Totally independent new music: http://www.pollyputthekettleon.com
Komrade K
Forum Full Member


Registered: 08/02/05
Posts: 927
Location: Whitstable, Kent England
 
Re:Brace for impact
Saturday, November 14 2009 @ 03:17 PM CST

Quote by: MotherofMeursault
Quote by: Komrade K



Quote by: MotherofMeursault

And not for nothing, but the 'other devil you don't know' in this case is insurance-free healthcare: no government, no insurance, no co-pays, just payment for services on the spot. I am using it for all my "elective procedures" and "pre-existing conditions" and I recommend it highly.





Which is fine if you can afford it but many people can't and for them we need a healthcare system (that is we do unless you simply don't give a f**k!).

KK



So much work to do!

I still owe you an explanation of my 'liberty' comments, Komrade; I have not forgotten. Be patient a little while longer, please. And I will respond to the rest of this comment, too.


But first of all:

I am not rich. I am not heartless. I spend thousands of dollars every year on a major insurance plan that I find fewer and fewer doctors are willing to accept.

Those doctors are not willing to employ people to chase the insurance companies, nor are they willing to extend free credit to the insurance companies for the time it takes to get paid (as much as a year!!) They have simply opted out of the system, and are charging LESS for the services because their costs are lower.
A real example: I needed to have a joint drained of some unpleasant fluid, and cortisone injected there. With my insurance plan, it would have cost about $350. I couldn't find an 'in network' doctor; they were all fleeing my insurance co.. When I decided to pay for it myself, it turned out to be a $175. procedure. Not cheap, but not terrible either. Now, if I were not saddled with a crushing insurance payment (which, I should point out is LOWER than the latest cost estimates from the government), I could afford to pay for all the care I need AND have plenty of money left over.
Why the need for all this insurance, anyway? Why not simple insurance for accidents and catastrophic care, and reasonable payment for services? Certainly, before this whole mess started Americans were not dropping dead in the streets due to selfish, grasping doctors and their larcenous prices.


More later.



Not sure that I have any issues with what you're saying here - makes sense to me. And I'm glad that you've managed to save money to get your knee sorted. However whilst you may not be wealthy you're clearly better off than many who would struggle to find $175 for what is a relatively straightforward procedure. This - and the fact that there are a significant proportion of procedures which are considerably more expensive and therefore financially troubling to those on even average incomes - is the reason why a system ensuring universal healthcare through some sort of insurance arrangement is necessary.

It seems to me from what you're saying that the US approach to healthcare is systemically corrupt and that the senior managements of these health insurance companies should be hauled before the courts and sent down for long periods for ripping off their customers.

Going forward costs need to be monitored more effectively to ensure value for money is delivered. If other countries can do it (often in tandem with insurance companies) then I'm sure the US can (and with the net effect that the tax payer is better off).

KK



MotherofMeursault
Forum Full Member


Registered: 09/28/08
Posts: 380
Location: , United States
 
Re:Brace for impact
Saturday, November 14 2009 @ 09:36 PM CST

Quote by: Komrade K


It seems to me from what you're saying that the US approach to healthcare is systemically corrupt and that the senior managements of these health insurance companies should be hauled before the courts and sent down for long periods for ripping off their customers.

Going forward costs need to be monitored more effectively to ensure value for money is delivered. If other countries can do it (often in tandem with insurance companies) then I'm sure the US can (and with the net effect that the tax payer is better off).

KK






I am by nature more sympathetic to business people (maybe because I know how difficult it is to make money), and I find politicians a truly repulsive breed; but...... some of the businessmen of recent years (for some reason, Angelo Mozillo jumps to mind) are a truly dreadful bunch. I'd volunteer time to help build them some 5'x8' 'homes' for the next 15-20 years.

The US government is responsible for a large measure of the corruption in the healthcare industry, though; so, even if I cut them some slack to help wind down this thread, I have to vote against their plan.

Warm Regards,

MoM
 
Dadai.2
Forum Full Member


Registered: 09/09/08
Posts: 1732
Location: Frisco, Texas 😎 USA
 
Re:Brace for impact
Saturday, November 14 2009 @ 09:53 PM CST

Quote by: MotherofMeursault

Warm Regards,

MoM


you gotta love this guy.... no?

D

Take a listen >>> Texas Tango