Anyone willing to bet on a devaluation of the dollar when all the debt bubbles burst?

[Galen]

(05-21-2016, 07:20 AM)Kinser79 Wrote: Given the current balance of imports to exports any attempt to maintain the welfare state as it currently exists without the petrodollar in place results in hyperinflation.  Once the US loses reserve status all those checks suddenly come due all at once.

As for which currency will likely replace the Dollar I expect it will be the RMB, China is already the largest trading country and the second largest economy, though the Rupee is looking pretty good because China's held it's One Child Policy a bit too long.  The Chinese seem likely to grow old before they grow rich.

Given the data available this is the most likely outcome.  The possibility that a gold standard of some kind may emerge can not be completely discounted.  In such a system a reserve currency is not necessary.  There are several decision points in the process to the outcome is not completely certain.  One thing that is certain is that the American Empire is in decline.

[Kinser79]

I would argue that the American Empire has been in decline since the 1970s.

That being said, a gold standard would present its own problems, namely that every country would have to maintain a reserve of gold and peg their currency in some way to gold. This will mean that the major creditor countries would end up sitting on stockpiles of gold and would over all inhibit world trade as gold is finite. It would also limit the trade prospects for countries that would prefer to back their currency with silver or any other metal.

That being said there are many many positives to using specie and ditching the banksters. One of the reasons I oppose taking Andrew Jackson off the 20--even if Jackson being on bank notes is somewhat ironic.

In before one of the Lib-tards starts shouting "hurr durr Jackson was an evil genocidal maniac racist, durp".

[Eric the Green]

(05-20-2016, 10:49 PM)Galen Wrote:

(05-20-2016, 09:50 PM)Kinser79 Wrote:

(05-20-2016, 06:54 PM)TnT Wrote: So my fellow Economic Wizards ... what is it?  Catastrophic inflation or catastrophic deflation?

A little of both.  Currently there is a deflationary trend, but all the imaginary cash created through QEinfinity will eventually have to wash through the economy causing a rise in prices and a devaluation of the dollar.  This will probably result in further down grades to US Bond status, once it reaches the general economy.  Rising prices of course would largely be the result of inflation as I don't foresee a major shut down of normal production and distribution just yet.

There is one simple question:  Will the Fed governors ever accept that Keynesian economics does not work?  If they accept this possibility then a deflationary period is likely followed by a long period of growth.  If not then the US gets to look like Venezuela or Zimbabwe.  So far the Fed has shown a pronounced tendency to print at every crisis but I have hedged against both possibilities in case they decide to behave in a sane manner for once.

One thing that you can count on is the economic predictions made by the Fed are the exact opposite of what will happen.  They have a lousy prediction record.  Even worse than Eric the Obtuse, which is quite a feat given how clueless he is.

My prediction record is unmatched by anyone, which anyone except Galen and Kinser can verify from my posts to these forums over the years. One thing is clear: the libertarian trickle-down economics that Galen the Clueless espouses, does not work and has never worked. On the other hand, the "welfare state" worked well from the 30s to the 70s, until Galen's and Kinser's hero got in and wrecked it and created the trickle-down economy we still live in today, and which has created a huge class division between rich and poor in this country.

So when will this current hour-glass Reaganomics economy cause the collapse of the dollar?

Actually that's a good question and I'll need to give it some thought. I am sure such a thing won't happen unless Trump upsets the applecart and somehow wins the election despite my prediction otherwise. If that happens, I'd say a collapse could come soon afterward. His childish economic and foreign policies could cause a panic rather quickly. But if my prediction holds and Hillary eeks out a win, then I expect no collapse during this decade, although a recession seems likely as the decade ends.

What may cause a collapse is if the country splits in the mid-2020s. This is still a possibility. It would be catastrophic, but the goal would be to free the blue half from the red half so that progress could resume. And then it might. I actually think the green energy boom will help to power a relatively booming economy in the 2020s. That seems the most-likely scenario. Trickle-down economics will be repealed too, and more equality (rather than the rich squelching everything as Galen and Kinser want), will generate an economic revival. For it is the middle class and poor spending money, as Keynes said, that boosts the economy; not Galen's wealthy few who spend their tax breaks and subsidies on luxury items that don't create many jobs, as well as on buyouts, firings, unions busts, lower wages, new plants overseas, automation, and other such goodies they buy with their trickle-down economics boons. 

The job creaters are job destroyers. Galen the Clueless's economic program has been tried for 40 years now and has failed miserably. The prospect that the Millies understand this, and will vote to correct it, assures a good chance of economic recovery as the 4T climaxes and the 1T begins, and we return to being a more equal and widely-prosperous society like the previous late 4T and 1T were in the previous cycle, instead of a libertine libertarian society dedicated to the fortunes of corrupt rich folks like Galen. Hey, maybe the turning cycle actually works??? Get a Clue, Clueless!!!

After that, I see the Awakening coming, and an unstable economy usually accompanies it. Global integration of the economy, combined with increased attention to local and national conditions, will work to avoid a devaluation if these liberal policies are implemented, instead of those of Galen the Clueless and Kinser the Korrupt. So, I don't forsee a devaluation happening, as far as I can tell now.

[Galen]

(05-21-2016, 09:23 PM)Eric the Green Wrote:

(05-20-2016, 10:49 PM)Galen Wrote:

(05-20-2016, 09:50 PM)Kinser79 Wrote:

(05-20-2016, 06:54 PM)TnT Wrote: So my fellow Economic Wizards ... what is it?  Catastrophic inflation or catastrophic deflation?

A little of both.  Currently there is a deflationary trend, but all the imaginary cash created through QEinfinity will eventually have to wash through the economy causing a rise in prices and a devaluation of the dollar.  This will probably result in further down grades to US Bond status, once it reaches the general economy.  Rising prices of course would largely be the result of inflation as I don't foresee a major shut down of normal production and distribution just yet.

There is one simple question:  Will the Fed governors ever accept that Keynesian economics does not work?  If they accept this possibility then a deflationary period is likely followed by a long period of growth.  If not then the US gets to look like Venezuela or Zimbabwe.  So far the Fed has shown a pronounced tendency to print at every crisis but I have hedged against both possibilities in case they decide to behave in a sane manner for once.

One thing that you can count on is the economic predictions made by the Fed are the exact opposite of what will happen.  They have a lousy prediction record.  Even worse than Eric the Obtuse, which is quite a feat given how clueless he is.

My prediction record is unmatched by anyone, which anyone except Galen and Kinser can verify from my posts to these forums over the years. One thing is clear: the libertarian trickle-down economics that Galen the Clueless espouses, does not work and has never worked. On the other hand, the "welfare state" worked well from the 30s to the 70s, until Galen's and Kinser's hero got in and wrecked it and created the trickle-down economy we still live in today, and which has created a huge class division between rich and poor in this country.

I suggest you take a good look at how the Code of Federal Regulations grown.  This level of growth does not suggest that the government is getting less insrusive but rather the opposite.  While Reagan had vaguely libertarian rhetoric the truth about his administration is rather different.  Total government spending versus GDP also paints a rather different picture that the one you suggest.  What we live under is a crony capitalist economy which is not even close to what a libertarian would consider a free market.

I will start to believe in your predictions after you manage to win the James Randi prize.

(05-21-2016, 09:23 PM)Eric the Green Wrote: The job creaters are job destroyers. Galen the Clueless's economic program has been tried for 40 years now and has failed miserably.

The US hasn't really had a free market economy but rather what have had is a continuation of the centralization of power in the US that has continued for the last century.  If my economic program had been implemented then government spending would have decreased and the Code of Federal Regulations would be much smaller.  Since these things have  not happened than it is safe to say that the government has not moved in a libertarian direction.

Once again, I thank you for demonstrating why you will always be Eric the Obtuse and showing how little connection you have with reality.

[Eric the Green]

(05-21-2016, 11:51 PM)Galen Wrote:

(05-21-2016, 09:23 PM)Eric the Green Wrote:

(05-20-2016, 10:49 PM)Galen Wrote:

(05-20-2016, 09:50 PM)Kinser79 Wrote:

(05-20-2016, 06:54 PM)TnT Wrote: So my fellow Economic Wizards ... what is it?  Catastrophic inflation or catastrophic deflation?

A little of both.  Currently there is a deflationary trend, but all the imaginary cash created through QEinfinity will eventually have to wash through the economy causing a rise in prices and a devaluation of the dollar.  This will probably result in further down grades to US Bond status, once it reaches the general economy.  Rising prices of course would largely be the result of inflation as I don't foresee a major shut down of normal production and distribution just yet.

There is one simple question:  Will the Fed governors ever accept that Keynesian economics does not work?  If they accept this possibility then a deflationary period is likely followed by a long period of growth.  If not then the US gets to look like Venezuela or Zimbabwe.  So far the Fed has shown a pronounced tendency to print at every crisis but I have hedged against both possibilities in case they decide to behave in a sane manner for once.

One thing that you can count on is the economic predictions made by the Fed are the exact opposite of what will happen.  They have a lousy prediction record.  Even worse than Eric the Obtuse, which is quite a feat given how clueless he is.

My prediction record is unmatched by anyone, which anyone except Galen and Kinser can verify from my posts to these forums over the years. One thing is clear: the libertarian trickle-down economics that Galen the Clueless espouses, does not work and has never worked. On the other hand, the "welfare state" worked well from the 30s to the 70s, until Galen's and Kinser's hero got in and wrecked it and created the trickle-down economy we still live in today, and which has created a huge class division between rich and poor in this country.

I suggest you take a good look at how the Code of Federal Regulations grown.  This level of growth does not suggest that the government is getting less insrusive but rather the opposite.  While Reagan had vaguely libertarian rhetoric the truth about his administration is rather different.  Total government spending versus GDP also paints a rather different picture that the one you suggest.  What we live under is a crony capitalist economy which is not even close to what a libertarian would consider a free market.

I will start to believe in your predictions after you manage to win the James Randi prize.

That will never happen; Randi is a fraud and his "prize" is just a publicity stunt. Noone will ever win the Randi prize because it doesn't exist and there's no criteria for receiving it; nor is he any kind of scientist. My prediction record speaks for itself, and is good; better than any pundit bar none.

(05-21-2016, 09:23 PM)Eric the Green Wrote: The job creaters are job destroyers. Galen the Clueless's economic program has been tried for 40 years now and has failed miserably.

The US hasn't really had a free market economy but rather what have had is a continuation of the centralization of power in the US that has continued for the last century.  If my economic program had been implemented then government spending would have decreased and the Code of Federal Regulations would be much smaller.  Since these things have  not happened than it is safe to say that the government has not moved in a libertarian direction.

Once again, I thank you for demonstrating why you will always be Eric the Obtuse and showing how little connection you have with reality.
[/quote]

Galen the Clueless does not understand that libertarian economics has been implemented in the last 40 years to the extent that its slogans of "less government" have been used to block almost every proposal of reform and problem solution that has been made on the grounds that it is government action. Of course it does not fulfill the libertarian ideal, because it is just a ruse to keep the rich in power. But the libertarian ideal would just be a more extreme version of empowering the rich than the phony Republican version.

[Galen]

(05-23-2016, 01:50 AM)Eric the Obtuse Wrote: Galen the Clueless does not understand that libertarian economics has been implemented in the last 40 years to the extent that its slogans of "less government" have been used to block almost every proposal of reform and problem solution that has been made on the grounds that it is government action. Of course it does not fulfill the libertarian ideal, because it is just a ruse to keep the rich in power. But the libertarian ideal would just be a more extreme version of empowering the rich than the phony Republican version.

Once again you have demonstrated your crystal clear anti-logic.  I am pretty sure that Obozocare is not a libertarian program.  Libertarians have been pushing for spending cuts for decades.  I am pretty sure that it wasn't libertarians that were pushing for bank bailouts or the monetary printing spree the Fed embarked on.  Then there is that little matter of having the NSA spy on everybody and then there is the TSA.

I would not call any of these things a victory for libertarians.  Apparently, in the Bizzaro world that you live in they do.  You really need to ease off the mind altering substances because you don't have the brain cells to spare.

[Kinser79]

Just for the record James Randi does in fact have the prize money. It is documented. Also James Randi has made no claim to be a scientist. As usual Eric the Ignoramus is speaking directly from his anus. It makes me wonder if he shits with his mouth.

[Eric the Green]

(05-23-2016, 03:30 AM)Galen the Clueless Wrote:

(05-23-2016, 01:50 AM)Eric the Obtuse Wrote: Galen the Clueless does not understand that libertarian economics has been implemented in the last 40 years to the extent that its slogans of "less government" have been used to block almost every proposal of reform and problem solution that has been made on the grounds that it is government action. Of course it does not fulfill the libertarian ideal, because it is just a ruse to keep the rich in power. But the libertarian ideal would just be a more extreme version of empowering the rich than the phony Republican version.

Once again you have demonstrated your crystal clear anti-logic.  I am pretty sure that Obozocare is not a libertarian program.  Libertarians have been pushing for spending cuts for decades.  I am pretty sure that it wasn't libertarians that were pushing for bank bailouts or the monetary printing spree the Fed embarked on.  Then there is that little matter of having the NSA spy on everybody and then there is the TSA.

It doesn't matter if a few tidbits like a massively-watered-down version of socialized medicine managed to get through after 35 years of YOUR economic policies, and CONTINUED policies for these last 7. YOUR guys have continued to block legislation and executive action on almost everything else for 40 years and counting. YOUR guys may continue to support many anti-libertarian policies that I also oppose, but honesty and truth is not what YOUR guys are interested in; they are only interested in protecting their profits from liberals. And that is the ONLY real effect or purpose of libertarian economics.

Quote:I would not call any of these things a victory for libertarians.  Apparently, in the Bizzaro world that you live in they do.  You really need to ease off the mind altering substances because you don't have the brain cells to spare.

I know; that's why I stopped what little I was doing somewhere about the same time that YOUR guys took over and started running the show.

I like your signature quote from Mencken better than Clueless Mises, but what you neglect to realize is that your libertarian ideas are idealistic and utopian. They have never been implemented and never CAN be implemented. But the slogans that convince people that they can be, put out by faux libertarians like Reagan, and paid for by libertarians like the Koch Brothers, do enormous damage.

No, materialism in its various forms is indeed the malady, even if idealism in every form is not always a good cure.

What IS OR IS NOT real "libertarian" may be YOUR concern, but it has little to do with whether the dollar will be devalued or which policies will help or hurt the economy.

[Mikebert]

PBrower Wrote:The troublesome debt is private debt -- not public debt.

IMO the guy with the best handle on this is Steve Keen.

[Mikebert]

(05-21-2016, 12:19 AM)Kinser79 Wrote: The Fed only has two leavers it can work economically, the interest rates and money printing.  The interest rate is already at its minimum.  That leaves money printing.

Interest rate policy IS money printing.

[Galen]

(05-23-2016, 11:27 AM)Eric the Obtuse Wrote: It doesn't matter if a few tidbits like a massively-watered-down version of socialized medicine managed to get through after 35 years of YOUR economic policies, and CONTINUED policies for these last 7. YOUR guys have continued to block legislation and executive action on almost everything else for 40 years and counting. YOUR guys may continue to support many anti-libertarian policies that I also oppose, but honesty and truth is not what YOUR guys are interested in; they are only interested in protecting their profits from liberals. And that is the ONLY real effect or purpose of libertarian economics.

I am simply amazed by your ability to ignore all of the facts in pursuit of blaming libertarians for what has been going on for 40 years.  It is quite an achievement for a political party that holds no national offices.  Anybody who know anything about the libertarians know that the spending cuts they would implement, given the chance, would dwarf anything that the hated Paul Ryan has ever come up with.

(05-23-2016, 11:27 AM)Eric the Obtuse Wrote: I like your signature quote from Mencken better than Clueless Mises, but what you neglect to realize is that your libertarian ideas are idealistic and utopian. They have never been implemented and never CAN be implemented. But the slogans that convince people that they can be, put out by faux libertarians like Reagan, and paid for by libertarians like the Koch Brothers, do enormous damage.

I put a Mises quote back in since you like him so much.  I doubt you are qualified to have an opinion on Mises because it is unlikely that you have read anything he wrote.  I would also not that for at least the first century of its existence the US was about as close to libertarians as the world has ever seen.  In fact it did very well until the Progressive Era when things started seriously to go downhill.

Here you might want to hear what some libertarians have to say about the Koch brothers and why so many avoid the Cato Institute.

[Galen]

(05-23-2016, 06:27 PM)Mikebert Wrote:

(05-21-2016, 12:19 AM)Kinser79 Wrote: The Fed only has two leavers it can work economically, the interest rates and money printing.  The interest rate is already at its minimum.  That leaves money printing.

Interest rate policy IS money printing.

You got it exactly right.  Just like the definition of inflation is increasing the quantity of money in the economy and subsequent consumer price increases or various bubbles are the consequence.

So far the Fed hasn't gone into the twilight zone of negative interest rates but they are thinking about it.

[Kinser79]

(05-23-2016, 06:27 PM)Mikebert Wrote:

(05-21-2016, 12:19 AM)Kinser79 Wrote: The Fed only has two leavers it can work economically, the interest rates and money printing.  The interest rate is already at its minimum.  That leaves money printing.

Interest rate policy IS money printing.

I would argue that interest rate policy is indirect money printing. Lowering the interest rate usually signals to borrowers it is time to borrow and that for spenders it is time to spend.

[Odin]

(05-23-2016, 11:54 PM)Galen Wrote:

You know that Rockwell is an unapologetic White Supremacist, right?

[Kinser79]

(05-24-2016, 07:28 AM)Odin Wrote: You know that Rockwell is an unapologetic White Supremacist, right?

I'm going to demand sauce or you have no argument.

[Mikebert]

Galen Wrote:Just like the definition of inflation is increasing the quantity of money in the economy and subsequent consumer price increases or various bubbles are the consequence

Increasing money supply is a definition of inflation.  Most people experience inflation as changes in the cost of living which have more to do with changes in the prices of goods and services rather than monetary aggregates.  A more useful inflation definition for most people is the rate of change in an appropriate price measure.
 
One can define a quantity in a variety of ways depending on the problem being addressed and the theoretical framework being employed. A certain kind of monetarist, or an Austrian would favor the definition you prefer.  For other schools and applications the other definition might be more useful. 

I am a Kondratieff fan and so I often think in terms of inflationary versus deflationary monetary environment.

The monetary environment is characterized by the change in price divided by the change in monetary aggregates as a fraction of GDP.  So I use inflation defined as dP/dt.  For example right now we are in a deflationary environment (Kondratieff downwave) because the rate of money growth relative to GDP is larger than the inflation rate.  Back in the 1970's, (A Kondratieff upwave) it was the other way around.

[Mikebert]

(05-24-2016, 12:14 AM)Kinser79 Wrote:

(05-23-2016, 06:27 PM)Mikebert Wrote:

(05-21-2016, 12:19 AM)Kinser79 Wrote: The Fed only has two leavers it can work economically, the interest rates and money printing.  The interest rate is already at its minimum.  That leaves money printing.

Interest rate policy IS money printing.

I would argue that interest rate policy is indirect money printing.  Lowering the interest rate usually signals to borrowers it is time to borrow and that for spenders it is time to spend.

Interest rate policy is performed using open market operations.  If the Fed wants to keep interest rates low they buy government debt.  They buy it with dollars they create.  Monetary easing adds money to the economy.  When the Fed hikes rates they sell government bonds for dollars, removing those dollars from the economy.

Normally the bond being uses are short term government securities.  One could do open market operations with other kinds of bonds.  When they do that they call it quantitative easing.  During 1942-1951 the Fed performed open market operations with both short term and long term debt maintaining interest rate pegs on both.

[pbrower2a]

The money supply will have to keep up with some other proxy (growth of the workforce or growth of productivity) to prevent deflation. If it overshoots badly, and hyperinflation usually reflects a political system overshooting the connection between money supply and growth, then one gets this sort of toilet paper as a joke of a currency:



Now demonetized.

A currency not a joke:



Inflation is estimated at 2%. The country produces some desirable goods.



Often  rejected in the country's shops. Not much useful stuff comes from North Korea, unless you consider street heroin useful.

[Eric the Green]

(05-23-2016, 11:54 PM)Galen Wrote: I am simply amazed by your ability to ignore all of the facts in pursuit of blaming libertarians for what has been going on for 40 years.  It is quite an achievement for a political party that holds no national offices.  Anybody who know anything about the libertarians know that the spending cuts they would implement, given the chance, would dwarf anything that the hated Paul Ryan has ever come up with.

I suppose so, and that's why they would be more dangerous.

Libertarians got their slogans adopted by the Republicans; that's all that they needed to accomplish in order to ruin the nation these last 35-plus years.

Quote:I put a Mises quote back in since you like him so much.  I doubt you are qualified to have an opinion on Mises because it is unlikely that you have read anything he wrote.

I wouldn't be caught dead reading Mises. I've seen enough of his quotes and enough discussion of him to know better.

Quote:  I would also not that for at least the first century of its existence the US was about as close to libertarians as the world has ever seen.  In fact it did very well until the Progressive Era when things started seriously to go downhill.

I suppose, if you would rather just forget that Alexander Hamilton ever existed.

Quote:Here you might want to hear what some libertarians have to say about the Koch brothers and why so many avoid the Cato Institute.

Ah, just select the libertarians you want and avoid the fact that Koch and Cato are libertarians.

[Galen]

(05-24-2016, 07:28 AM)Odin Wrote: [You know that Rockwell is an unapologetic White Supremacist, right?

Where is your source on that? Your contact with reality has always been rather sporadic.