There is no free-market

Kinder Graham | Respected Invincible!
 
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Well, for America at least (don't know about other countries)

Free-market is defined as "an economic system in which prices are determined by unrestricted competition between privately owned businesses."

Back in the 1913, America's economy stopped being a TRUE free-market and capitalist system. What major event occurred in this year? The creation of the Federal Reserve. Each year this small group of people get together and hold a committee called the Open Market Committee (FOMC). This committee is charged with the task of deciding the amount of currency in the system (Reserve Notes, which is actually worthless) and how much it is worth, and even the amount of interest rates on said currency.

Now look at the definition of market manipulation/manipulative-market

"Market manipulation is a deliberate attempt to interfere with the free and fair operation of the market and create artificial, false or misleading appearances with respect to the price of, or market for, a security, commodity or currency"

What the Federal Reserve does each and every year is they sit and manipulate the system in order for it to work in their advantage. There is nothing free about that. When people, example being Kiyo, says Capitalism or free-market fails, it isn't because we don't live under such a system. We live under Cronyism


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For once I agree with you.


 
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Meh. Agreed.

Still doesn't mean a 100% free market is a good thing


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Fiat Money == Joke

Quote
Fiat money has been defined variously as:

  • Any money declared by a government to be legal tender.[2]
  • State-issued money which is neither convertible by law to any other thing, nor fixed in value in terms of any objective standard.[3]
  • Intrinsically valueless money used as money because of government decree.[4]
  • While gold- or silver-backed representative money entails the legal requirement that the bank of issue redeem it in fixed weights of gold or silver, fiat money's value is unrelated to the value of any physical quantity. Even a coin containing valuable metal may be considered fiat currency if its face value is defined by law as different from its market value as metal.[5]

fixed
Last Edit: July 31, 2014, 07:50:03 PM by Crouton


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That's why in school they tell us that we have a mixed economy. No where in the world is the market unrestricted.

On the topic of the Federal Reserve, I'm not entirely sure I would say that inflation is bad. My best understanding as an average citizen without any kind of degree in economics is that by printing more money they aren't actually creating wealth, they're just redistributing it. Everyone's dollar value shrinks a tiny bit and the Federal Reserve has their own lump of cash. The Fed then loans that money to private banks who can use it to make investments in projects which help run the economy. And if there comes another recession, people will always be able to cash out their money.

I'm inclined to believe that the Federal Reserve doesn't use that money for their own salaries. Private banks are another story, but if it's a loan it at least gets paid back. Or at least that would be the hope. Investments aren't always successful.

Money is created, and backed only by bonds which are purchasable by anyone, anywhere.


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That's why in school they tell us that we have a mixed economy. No where in the world is the market unrestricted.

On the topic of the Federal Reserve, I'm not entirely sure I would say that inflation is bad. My best understanding as an average citizen without any kind of degree in economics is that by printing more money they aren't actually creating wealth, they're just redistributing it. Everyone's dollar value shrinks a tiny bit and the Federal Reserve has their own lump of cash. The Fed then loans that money to private banks who can use it to make investments in projects which help run the economy. And if there comes another recession, people will always be able to cash out their money.

I'm inclined to believe that the Federal Reserve doesn't use that money for their own salaries. Private banks are another story, but if it's a loan it at least gets paid back. Or at least that would be the hope. Investments aren't always successful.

Inflation is bad. It decreases the value of the dollar and thus reduces what you can buy with it. And it's not redistributing "wealth" by printing more, it's trying to save their asses and the government's asses. In fact a great majority of the money is actually created by PRIVATE banks, not the government

Did you watch that 30 minute video I posted in cy's marriage thread a few days ago? It will explain better


 
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This is the way the world ends. Not with a bang but a whimper.
Inflation, at rates of 2-3% is superior to anything higher or lower.

The Gold Standard is dead, and let it stay that way.


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This is the way the world ends. Not with a bang but a whimper.
Inflation is bad. It decreases the value of the dollar and thus reduces what you can buy with it.
Yes but there would be more money. Right?


What's your point, exactly?


Kinder Graham | Respected Invincible!
 
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Inflation is bad. It decreases the value of the dollar and thus reduces what you can buy with it.
Yes but there would be more money. Right?
And it's not redistributing "wealth" by printing more, it's trying to save their asses and the government's asses.
Did you mean that literally or were you just dispersing emotions? The Fed creates more money which decreases everyone else's dollar value and the Fed ends up with a profit. The wealth is redistributed to them.
In fact a great majority of the money is actually created by PRIVATE banks, not the government
Is it actually significant that the Fed would contract private banks to print money? The majority of money they create is digital anyway. Or do you mean something else? And more importantly, what exactly makes your video a reliable source?

I'm trying not to discuss politics anymore; I'm only here because I'm interested in the functions of Fed.
There would be more bills in circulation but it decreases the worth of bills when more are created. Example being gold and that the more of it then the less it's worth while the less there is then the more it's worth. Too much of anything is bad

I guess literally

Well they are not actually contracting them. Say a person has $100 and decide to deposit that in the bank. Banks have to keep a percentage of that $100 so you can have it any time you want while they take the rest and use for other means like giving out loans. With $100, let's say the bank only has to keep 10% meaning you only have $10 in the bank and the rest is simple IOUs whilst the other $90 is given out as loans. Before there was $100 but the loan of $90 creates an extra $90 meaning the money supply is actually $190. This cycle repeats itself and thus is where majority of the money comes from. This can be considered unconstitutional as ONLY Congress has the power to make money, not private banks

Facts is what makes it reliable