Please refer to this link: http://www.pbs.org/newshour/businessdesk/2013/10/why-debt-and-money-created-out.html Inflation keeps the economy from imploding. I understand that. If I can sell only at lower price as in deflation, I may sell at a loss; so, why should I produce? Federal Reserve is supposed to be independent from politics and it is supposed to shield the economy from politics. Okay, I will give it a benefit of doubt. Money is debt. Okay, I understand that, too. My question is this: It is fair that a few people or a few entities have been granted the godly power to create money out of thin air with no effort, whereas the rest of society have to be slaves, have to labor, have to sweat and bleed to earn what these few "create" out of thin air? Or the economy is inherently made to favor a few at the expense of the rest? Are the rest 99% just so stupid to be sheep to be fleeced? If fairness is never in the economy or society, then is this a world we want to live in? WTF? Would appreciate your thoughts. Thanks.
No! It's neither fair or necessary. The founding fathers warned of the very type of central bank and monetary policy we have right now. We've ignored them. At some point, I don't know when, we will pay the consequences. Whether it ends in an apocalyptic event or simply the steady decline we're already in I also don't know.
Firstly, what exactly and specifically is "unfair" about this arrangement? Secondly, what alternative system do you have in mind? And, btw, money isn't really debt.
I am not sure this is correct... Isn't the type of central bank that exists today a culmination of Alexander Hamilton's vision? And isn't Hamilton considered to be one of the founding fathers?
Some of the banks at the time of the founding fathers were publicly owned, as is the bank of North Dakota today. We could have publicly owned banks the gains of which helped pay for our government, maybe a sales tax would be additionally needed. It's not clear to me what our private sector would be like if the public sector was doing all the lending however. Would innovation suffer? Would politicians exert too much control over the lending?
The QE is a great ponzi scheme started in 2010 to finance the existing debt with a new debt. The fed and the US government has a right to print as much money as necessary and tax as much as they wish, same is true with any government in the world....nobody can stop any government from doing so. The QE will only stop or taper when other countries are willing to buy US debt and also when US government reduces government spending and thus reduce the necessity to borrow more. So the QE and low interest rate environment are not going to be changed soon. US and fed are currently promoting this massive monetary stimulus whereby the stock markets are rising to create a huge bubble so even if the markets fall when they taper the stimulus, they will fall from extreme levels. How will all this end? Either there should be complete economic overhaul including both fiscal and monetary policy or total chaos ending in world war 3. For a total economic overhaul, US needs to reduce its spending, promote economy based on production and exports rather than consumer driven economy and promote small businesses to reduce overall unemployment. If china and japan start selling US treasuries and middle eastern countries prefer euros rather than dollars for oil, then it will be a real disaster for US and it will ultimately lead to power struggle and world war 3.
Alexander Hamilton, one of the few American figures featured on U.S. Currency who was never president. Killed in 1804 in a duel with Aaron Burr. He did not sign the Declaration of Independence. Though he did serve with Washington throughout the Revolutionary War. You are correct it was chiefly his idea to start a national bank. Paying off the war debt was the primary impetus I believe. The idea was considered controversial at the time. As in not all the founding fathers agreed with it. "I believe that banking institutions are more dangerous to our liberties than standing armies." Thomas Jefferson
very compelling link... I plan to just watch the first minute or two... then I did not want it to end. and it seems to speak to the fairness issue. I was not even aware of the IRS issue touched on in the video. <iframe width="640" height="360" src="//www.youtube.com/embed/RrwbgdtbdXE?rel=0" frameborder="0" allowfullscreen></iframe>
Clearly Hamilton's vision won out over Jefferson's and just as clearly it won out because the alternatives to a central bank did not mean any more equality than having one. J.P. Morgan was able to put a consortioum together during the 1907 Panic that, in the aggregate and at his direction, became the lender of last resort. The result was that it became clear that if America was to become the world's leading industrial and financial power that role needed to be codified. Even The House of Morgan was no longer big enough for the tasks at hand. It was never a level playing field. None of it was ever -- at any point in history -- designed to be a level playing field. Jefferson, who spread vicious lies about one of his closests friends ... Adams -- was an ashole who understood little about the mechanics of finance yet ponitificated as if only he knew the way it should be. An asshole ... pure and simple. That's not to say the FED is a panacea just that no one knows exactly what could replace it. We can't have the Paul's -- father and/or son -- designing what comes next.