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Is it time for the FED to restore interest rates?

EatTheRich

President
Remember my posts about perceived value becoming value? And how I predicted the dollar would go into a flat spin and devalue to nothing? Did that happen? Almost everyone here would say NO, but it actually did happen, and not only so, I also predicted that once the dollar collapsed it would be unable to rise again, that it would remain broken as a currency.
Not only did it not happen, but the dollar is in fact unusually strong. If interest rates are increased, it will become stronger. Part of the problem for U.S. industry is that they can't find a (reasonable) monetary policy that will weaken the dollar enough to boost export sales.

It happened dramatically. The discussion was about interest rates and someone asked me how many cycles did I think the dollar had left before rates would totally collapse and not be able to rise again. And I said, "one cycle, then it collapses to zero and stays there." That was ten years ago. and that was exactly what happened, Bernanke rose the rates 1/4% at a time for like 14 straight meetings and then POW rates collapsed in dramatic fashion right to zero for both target rates and have stayed there for both target rates. Being able to predict that; when it had never happened before, and nailing the cycle for it to happen in, and predicting the aftermath on top of that... okay, I think that says I knew the system and the times we lived in better than all the idiots in BOTF that claimed to understand it better than me. Eventually Cicero posted, "Days got it right"... but none of my foes ever admitted it.

Let's explain what the value of our synthetic money is comprised of:

That was the collapse of the dollar. And the fact that the obama recovery was unable to pull either rate up from zero shows that the economic engine that drives the rates is still konked, we can't get up any steam at all, zero, zip, nada.
No, that was an industrial collapse. And its ongoing nature reflects the fact that even when money is practically being given away to industrialists they still think hoarding a dollar (or gambling it on leveraged debt, corporate restructuring, or real estate, but only if the profits promised are utterly unsustainable) is more worthwhile than investing it in expanding production.
 

EatTheRich

President
He learned that from his Secretary of Treasury, whom he later made Supreme Court chief justice. Which, coincidentally, also provided the nation with some pretty good rulings for the later part of the 19th century.

Ever since Lincoln, the nation has known the president can print money. We really didn't know that, before Lincoln. When Jackson killed the central bank, he sent the nation's money to state banks; a nice kickback for the states! We had no debt, we didn't need to print money. But today, we are in dire straits, much more dire straits than Lincoln was in when he fired up the printing press. Every leader knows it and every leader is too afraid to use it. So we try to pay a debt in the trillions with an income tax in the billions... we can barely pay the interest.
Printing money in limited quantities can be a good idea. But it's not a panacea, especially if that money is just handed over to bankers, when the real crisis is that industry has little incentive to produce because poor people can't afford the goods that are rotting in warehouses or destroyed to increase prices.
 

EatTheRich

President
yes it would be! And what does the 21st century version look like? Well, the real deal is when Jesus returns and destroys those who are destroying the earth (the bankers) - but in the mean time, we could pay off our outstanding bonds with Treasury issue and stop collecting that illegal income tax. Then all we need is another 100 million jobs that pay a fair wage and we might start feeling free again!
We should have a massive public works program to create jobs. With affirmative action in hiring, with strict quotas to ensure success.
 

EatTheRich

President
I do not think Bernie Sanders getting elected would do more than the election of Obama to solve the fundamental problems facing us. And I find some of his jingoism abhorrent. I am intrigued, though, by the possibility that his campaign will get more people talking about socialism and socialistic policies.
 

EatTheRich

President
Sheila Blair (head of the FDIC) called for zero interest Treasury loans (that should be done through a GSE, and the Treasury could fund those loans through their own issue)... why can't we do that?
Assuming there is any inflation, the GSE will require a subsidy which will, in effect, assume the shape of interest payments. If the treasury just issues the money the money supply goes up and you get inflation ... not necessarily a bad thing if it counterbalances strong deflationary tendencies ... but not sustainable long-term either.
 

EatTheRich

President
No truck pulled up with bars of silver, no real money is connected to the game, the bank issued the "money" just by saying it existed.
Silver is no more "real money" than paper money or electronic credits.

What people do not understand, and what the banks play on their ignorance, is that the banks are creating our money for us. We do not create our own money, all we do is take loans from the banks, the banks create the money when they create the loans. So, when someone says, Treasury loans would inflate the money supply, that is massive ignorance; the same amount of money is going to be created, whether the loan is created by Treasury issue or bank issue, but because the banks want that money (whoever creates the money is owed the money) (aka, whoever makes the loan is owed the loan) they float total lies; rumors in the media, that Treasury issue would inflate the money supply. Actually, bank loans have 100% interest over a 30 year term, so bank loans inflate the money supply twice as much as a Treasury loan.
You think the banks are AGAINST the government giving them a bunch of money (by printing notes to pay off the debt owed to them)? And you think that the effect of doing so won't be to encourage them to loan out more money?

The damage is already done with our Treasury loans (bonds) written for the whole world. These are not Treasury issued loans to the banks, these are bank issued loans to the Treasury. Talk about slight of hand, the FED derives its authority to create money (remember, the money is created by authorization) from the Treasury, then uses that authority given to it from the Treasury to make loans back to the Treasury; in essence, the Treasury is borrowing its own money(authorization) from the banks. The least the Treasury could do is pay off those loans with its authority, but they don't, they force an illegal personal income tax upon US citizens to supposedly pay for those loans. (that they never needed to make in the first place)
1. For the record, the FED does not buy bonds directly from the Treasury.
2. Generally speaking, credit makes commerce possible.
3. The income tax is specifically authorized after passing due to popular pressure.
4. A state that relied solely on printing money and going into debt and not at all on taxes would quickly see its money become worthless. Not a big deal if you don't have any but definitely a big deal for those on fixed incomes.
 

EatTheRich

President
There's a million ways to rebuild the infrastructure, and every one of them is the same; take our money back. When banks were actually holding real money and loaning it out for business, they were useful. You'd think after 400 years of getting scammed, the people of the world would figure out that bank coupons are counterfeit. If you really wanted to go back to the republic laid out in the Constitution, you have to do away with paper money. The problem with that is, the banks already stole all the real money. Would if we threw a financial revolution... left the jails alone... but marched the military into all the banks, killed the devil worshipers in the back room, took all the gold and marched it over to the mints? Then used it for capital investment rebuilding our old factories into modern factories? Build a real communist state where the people actually rule; where the state owns the businesses and turns all the profits over to the employees at fair ratios (CEO's make 6:1, not 1000:1) and then we wouldn't need any banks. You do realize how easy it would be to structure a corporation that way? If people were making that much money, you could set up a real trust fund for each individual, in their name, so their money put aside is solely for themselves. And since it is their money, let them draw upon it whenever they please; like a real savings acct works... who would need a bank?
I like your thinking but why would you leave the jails alone?
 

EatTheRich

President
I know European elites were happy the war power was destroying chattel slavery because they knew capitalism provided a more cost effective means of controlling labor??
A lot of them were actually on the slaveowners' side, both because they profited from cheap cotton and because they wanted to reduce competition by establishing a balkanized, weak, backward United States.
 

EatTheRich

President
I think this was the planning stage for another central bank in America? Only this time, they were going for the throat... the money creation process. So, in context to that letter, the central banker is saying that his NY attaches need not worry about replacing the nation's real money with bank notes, because after all, the people who understand what they are pulling are already on board and the masses can't tell the difference between debt currency and real currency. IOW, the bankers are taking away their money and placing them in debt to the banks, but the people will still think they are holding ten dollars in their hand. The masses are incapable of grasping that the new system enslaves them to the banks. The masses are incapable of understanding the tremendous advantage of the real money they are currently holding, which is that it can't be debased by the system; hence "the tremendous advantage that capital (real money they are using) derives from the system."

The burdens that the people would bear to the new central bank would be to finance it's cash flow with an income tax on their wages. Income is a word used in business for a corporation's balance sheet; incoming money is on one side of the equation, and when it exceeds debits, payroll, et all on the other side of the equation, what is left is called profits. The income tax was a tax on corporate profits, never a wage tax. The very idea of taxing a wage is theft, it isn't honest government. Stealing money from wages to provide cash flow for the new central bank is the way the new system was going to be inimical to the people's interests.
Wages shouldn't be taxed. "Capital" does not mean "gold" or "specie." It means "wealth that is used to generate more wealth for its owner." I'm not sure what the quote means, and neither is anyone who doesn't know the specific context.
 

EatTheRich

President
And those New York bankers reading the Rothschild letter in 1863 waited 50 years for their payoff, just in time for the War to End All Wars. Imagine if a majority of US voters ever became convinced they could end war AND income taxes? Where's Huey Long when we really need him...still dead, I guess?o_O
Huey Long is an attractive political figure in a way. Not his dictatorial political machine. Not his quack monetary nostrums. Not his association with fascist figures like Charles Coughlin. But I do like that he was not afraid to engage in government spending for infrastructure improvement. He also had a relatively good record on civil rights for a southern governor/senator of his time.
 

EatTheRich

President
In function, it's a plutocracy, not a republic, so it doesn't matter any more what the people think. Back in 1863, it mattered, not any more. I think the internet will wake up the majority of US voters... and they will not be able to change a thing. But they will understand fully why the Lord Jesus killed all the top bankers when he returned and why he gave them all their money back. This generation knows they have been shafted, they might not understand the intricacies, but they know the banks are ripping them off.
 
I do not think Bernie Sanders getting elected would do more than the election of Obama to solve the fundamental problems facing us. And I find some of his jingoism abhorrent. I am intrigued, though, by the possibility that his campaign will get more people talking about socialism and socialistic policies.
I'm not sure Bernie would have responded to the economic collapse of 2008 in the same way Obama did. In general, Bernie seems to understand the role government plays in wealth distribution while Obama (and the Clintons) ignore it.
http://www.washingtonsblog.com/2015/08/bernie-sanders-versus-obama-the-clintons-the-big-difference.html
"The entire careers of Bernie Sanders, versus Barack Obama and both Bill and Hillary Clinton, display a stark difference.

"Whereas Obama and the Clintons were trying to win the votes of Democrats while secretly supporting Republican policies to redistribute even more wealth upward from the public to the aristocracy (and they did so) (and how!), Sanders has consistently been trying — and helping — to do the exact opposite: to redistribute wealth downward, from the aristocracy to the public.

"Taxes, and all of government policies, are inevitably wealth-distributional (who pays how much, and who gets how much of the benefits; and what benefits pay needs, versus what benefits pay mere wants).

"Any politician who says that government isn’t largely about the distribution of wealth, knows that what he is saying is false — he or she is lying about government. (Only their suckers can believe it.) The question isn’t whether government should redistribute wealth; it’s how. That’s reality, and every public official knows it."
 
A lot of them were actually on the slaveowners' side, both because they profited from cheap cotton and because they wanted to reduce competition by establishing a balkanized, weak, backward United States.
England abolished slavery in 1833 with its Slavery Abolition Act. It was widely understood illiterate workers would be of limited usefulness after the Industrial Revolution took off. King Cotton decreed the shackles come off the ankles and go on the mind.
 
Huey Long is an attractive political figure in a way. Not his dictatorial political machine. Not his quack monetary nostrums. Not his association with fascist figures like Charles Coughlin. But I do like that he was not afraid to engage in government spending for infrastructure improvement. He also had a relatively good record on civil rights for a southern governor/senator of his time.
Do you see any contemporary political figures reminiscent of Huey? I think Long would have been undone by Power had he ever reached the White House, but I agree with him on some of his civil rights and economic positions.
 

EatTheRich

President
I'm not sure Bernie would have responded to the economic collapse of 2008 in the same way Obama did. In general, Bernie seems to understand the role government plays in wealth distribution while Obama (and the Clintons) ignore it.
http://www.washingtonsblog.com/2015/08/bernie-sanders-versus-obama-the-clintons-the-big-difference.html
"The entire careers of Bernie Sanders, versus Barack Obama and both Bill and Hillary Clinton, display a stark difference.

"Whereas Obama and the Clintons were trying to win the votes of Democrats while secretly supporting Republican policies to redistribute even more wealth upward from the public to the aristocracy (and they did so) (and how!), Sanders has consistently been trying — and helping — to do the exact opposite: to redistribute wealth downward, from the aristocracy to the public.

"Taxes, and all of government policies, are inevitably wealth-distributional (who pays how much, and who gets how much of the benefits; and what benefits pay needs, versus what benefits pay mere wants).

"Any politician who says that government isn’t largely about the distribution of wealth, knows that what he is saying is false — he or she is lying about government. (Only their suckers can believe it.) The question isn’t whether government should redistribute wealth; it’s how. That’s reality, and every public official knows it."
I think that if he were elected Wall Street might be more constrained than under Obama just by the expectations people (especially those mobilized to support him) had of him. Just as to a much lower extent they were more constrained under Obama than under Bush, where it was considered a foregone conclusion that we would all get hosed.

He did give a strong denunciation of the bailout for a senator.
http://www.amazon.com/The-Speech-Historic-Filibuster-Corporate/dp/1568586841
 

EatTheRich

President
Do you see any contemporary political figures reminiscent of Huey? I think Long would have been undone by Power had he ever reached the White House, but I agree with him on some of his civil rights and economic positions.
Interesting question. How about Nicolas Maduro? Of American figures I can think of right now, I see resemblances in Obama (the machine politics, "smartest guy in the room" syndrome, welfare-statism and power lust) and Huckabee (economic populism, rural support base). But honestly I think Donald Trump, for all the differences, is the most prominent Huey Long-like American figure today.
 

Days

Commentator
My proposals:

1. Nationalize the means of credit.
2. Make loans available at low interest to family farmers and small business owners.
3. Institute a sliding scale (indexed to inflation) of wages.
4. Cancel all municipal bonds and student loans.
5. Cancel the third world debt.
If you do this, you have to do it all the way. You have to build a new infrastructure with a real money base. Since the banks would pull out of the system (as if they hadn't already done that) it will be dependent upon the government to rebuild the industrial infrastructure. I'm of the opinion that it is already the case, no one is going to do this, so it is already dependent upon the government to do it. I don't give a damn what the economic theory is behind such a system, the bottom line is we have zero options, the only economic force capable of building industry and commerce is our central government; of course we would need a bloody revolution to get this govt to do it, or a military coup d'etat that forced the White House, Congress, and courts to act in the interests of the people, I really don't know what it would take, but it wouldn't come easy.
 

Days

Commentator
Not only did it not happen, but the dollar is in fact unusually strong. If interest rates are increased, it will become stronger. Part of the problem for U.S. industry is that they can't find a (reasonable) monetary policy that will weaken the dollar enough to boost export sales.

It happened dramatically. The discussion was about interest rates and someone asked me how many cycles did I think the dollar had left before rates would totally collapse and not be able to rise again. And I said, "one cycle, then it collapses to zero and stays there." That was ten years ago. and that was exactly what happened, Bernanke rose the rates 1/4% at a time for like 14 straight meetings and then POW rates collapsed in dramatic fashion right to zero for both target rates and have stayed there for both target rates. Being able to predict that; when it had never happened before, and nailing the cycle for it to happen in, and predicting the aftermath on top of that... okay, I think that says I knew the system and the times we lived in better than all the idiots in BOTF that claimed to understand it better than me. Eventually Cicero posted, "Days got it right"... but none of my foes ever admitted it.

Let's explain what the value of our synthetic money is comprised of:



No, that was an industrial collapse. And its ongoing nature reflects the fact that even when money is practically being given away to industrialists they still think hoarding a dollar (or gambling it on leveraged debt, corporate restructuring, or real estate, but only if the profits promised are utterly unsustainable) is more worthwhile than investing it in expanding production.
This was hard to read, but I want to make clear that I was speaking of the dollar in terms of the fuel for the nation's economic engine. When the two main FED spigots from which banks get the fuel are both at zero octane; how else to phrase that? When the air pressure that drives the turbine from the two main jets is zero... when you have no steam up, the engine has died, it is shut off.
 

EatTheRich

President
This was hard to read, but I want to make clear that I was speaking of the dollar in terms of the fuel for the nation's economic engine. When the two main FED spigots from which banks get the fuel are both at zero octane; how else to phrase that? When the air pressure that drives the turbine from the two main jets is zero... when you have no steam up, the engine has died, it is shut off.
It sounds as if we're in agreement then ... the U.S. today is in the position of Japan about 15 years ago. https://en.wikipedia.org/wiki/Lost_Decade_(Japan)

Except Japan had strong growth in the U.S., EU, and China to re-stimulate commerce eventually ... while the U.S. is being pulled down by the EU, getting no relief from China, and pulling Japan and the rest of the world down with it.
 
I don't give a damn what the economic theory is behind such a system, the bottom line is we have zero options, the only economic force capable of building industry and commerce is our central government; of course we would need a bloody revolution to get this govt to do it, or a military coup d'etat
The US military played a prominent role in building the Transcontinental Railroad in the 19th century and organized crucial aspects of FDR's New Deal in the 20th. If some Pentagon thinkers believe climate change represents a legitimate national security risk, the US military could direct a 21st century Green New Deal program capable of providing jobs for millions of unemployed young people from Yucatan to the Yukon. Perhaps the US Constitution could be amended to permit the Pentagon to partially fund its operations with revenues received from new infrastructure projects once they go into operation?
 
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