Jim Corr, New World Order Plant?

Brown Bomber

Flamed Diving wrote: »

Make a lot of noise. Any attempt at a carefully constructed explanation would be wasted here, in my opinion.

Why so?

Flamed Diving

Brown Bomber wrote: »

Why so?

Because I attempted to do so before. I have copied and pasted the relevant stuff here:

A question to begin with.

1) Inflation hurts people, can you think of anyone else that it hurts?

If it works exactly as you describe then the banks are only hurting themselves, for if they drive inflation ever-upwards then they would have to raise interest rates to ridiculous levels to make sure they earn any return on the money they handed out. According to the guy who made the movie, this is whats happening and yet we don't see it, interest rates are not at crazy levels, and inflation is not rampant. He says that $10bn becomes $90bn (or whatever) because of the way the system works. What he refers to is actually called the money multiplier, which is a simple mathematical model which houses a number of abstract assumptions which don't hold in reality (it is a useful description, nonetheless). So the money never reaches the levels that he describes (although it does expand), but this is yet another inconvenient fact that he excludes. If the US does work as he describes, why aren't we seeing >100% inflation(p.a.)/interest rates there? Surely this would be the outcome of such a never-ending spiral?

In addition, it is funny that he cites Abe Lincolns move to produce greenbacks as legal tender being produced by Treasury, which is something you CT'ers advocate. Does anyone know what the outcome of this move was? Because he excludes that little piece of info...

The ECB's charter is strictly based on keeping inflation below 2%. Good for banks, good for business and good for people (although not so good for growth...). For the record, I have problems the way The Fed works, as I have stated many times on the economics forum. What bothers me is that people watch this movie without checking up the assertions he makes. The guy who made this movie is either an idiot or a liar who correctly assumes that he can manipulate uncritical audiences into believing whatever lies he concocts, and I am betting on the latter. You dont need a degree in economics to tear this guys arguments to shreds, you just need an open, critical mind and the patience to read a book or two.

Mr.Zeitgeist does this:

Inflation hurts banks, business and people. Oops, that doesn't work for my already-reached conclusion. How about I do this...

Inflation hurts banks, business and people.

Ahhh, thats better...

Any nonsensical response to this will be disregarded.

Torakx

Good reply.
Do you know if the issueing of money to a government comes with interest attached?
That was my main scruple that i was lead to believe every time the gov gets bonds to print money or however it works here too they had to pay back interest.

Flamed Diving

Torakx wrote: »

Good reply.
Do you know if the issueing of money to a government comes with interest attached?
That was my main scruple that i was lead to believe every time the gov gets bonds to print money or however it works here too they had to pay back interest.

I believe that is the way things work in the US, yeah. Since the Central Bank here doesn't control the money supply, I don't think that's how it works. However, it is still the governments bank, so to speak. But every year the CB pays all surplus income back to the Exchequer. It's there in the annual report.

The idea of having a central bank that is independent of the government is a sound one. Governments just have a habit of printing money every time there is an election, you know?

Yitzhak Rabin

The Zimbabwe government prints their own money. I'm pretty sure they have an economic utopia with no inflation...;)


Just popping to the shop for some bread.

Lab_Mouse

yekahs wrote: »

Just popping to the shop for some bread.

either that or getting 'The Corrs greatest hits'...a four track cd

oceanclub

oceanclub wrote: »

Mahatma, any chance of an answer to this?

P.

Mahatma, curious as to why you haven't answered this as you've been posting to the group in the meantime.

P.

Torakx

yekahs wrote: »

The Zimbabwe government prints their own money. I'm pretty sure they have an economic utopia with no inflation...;)


Just popping to the shop for some bread.

This would still happen and has in countries that are charged interest for printing more money.
If you flood the market with a product its value goes down.You just dont have so much debt this way.
So i still dont understand the issue with issueing our own money instead of paying some guy to do it for us.
However its been pointed out to me recently that europe does not pay an outside source to print our money,also the question of wether we pay interest to print our money hasnt been tackled here iirc.
So i would appreciate any info on how,where and who in europe prints our money and at what price.

Flamed Diving

Torakx wrote: »

This would still happen and has in countries that are charged interest for printing more money.
If you flood the market with a product its value goes down.You just dont have so much debt this way.
So i still dont understand the issue with issueing our own money instead of paying some guy to do it for us.
However its been pointed out to me recently that europe does not pay an outside source to print our money,also the question of wether we pay interest to print our money hasnt been tackled here iirc.
So i would appreciate any info on how,where and who in europe prints our money and at what price.

The ECB print (and withdraw) all money for the Eurosystem. The rate that they charge banks for this injection depends on the interest rate they are targeting. So if they are attempting to get banks to charge 5% on mortgages, the ECB will let banks bid for X amount of money, hoping the volume offered is enough to reach X%, leaving the banks a little room to make their profit. The term that the ECB sets on these loans determines whether the volume of money is increasing or decreasing, over time. The interest rate they are targeting depends on the inflation rate they are targeting. This is always 2%, and it is the primary goal for the ECB's existence; to maintain low inflation.

With respect to your opening statement, can you give me an example of a country that had an independent central bank, who had a low inflation target, and wound up with inflation rates of 11,000%?

When governments print their own currency, they tend to use it to pay the bills while running deficits, instead of using tax intake, or issuing bonds. Furthermore, they can pull sneaky tricks using inflation, such as increasing the money supply before an election, to cause a mini-boom to sweep them back into office, only for the inflationary consequences to occur after. The second trick is to issue bonds in your own currency, spend the cash and then increase the money supply, thus reducing the value of the bonds. However, this has a long-term counter productive effect, as people will simply charge higher interest rates for your bonds, when you next seek a loan. If you continue pulling these tricks, it can become easy to get caught in an inflationary spiral, which is very difficult to get out of, and can destroy your economy.

The last place you want the keys to printing money, is in the hands of politicians.

Torakx

Thanks for explaining,although il be honest in saying i just about got the gist of it.And i am not well this week so kind of foggy on the brain.

I did have some time to look into the central bank using wiki and some sites that are apposing interest.
http://endtheecb.ning.com/forum/topics/on-interest

Now im not going to get into an indepth discussion on interest because i am the one seeking the knowledge here,but id like you view of this too.

It just seems to me that there is something built into the system to create inflation and i dont understand why it must be so.
I really wish there was the opposite to the CT side here to do a docu on how the monetary system works in europe.
The average person needs it explained in a more simplified manor i think.
Zeitgeist and The secret Of OZ were great for simplifying the explanation and i understood it.Now im informed they are wrong especially regarding europe but im finding it difficult to get info in a more basic form to show me exactly how a transaction works and why it works that way.

Il consider making a thread so people can discuss this more openly as its going off topic in this thread.
Actually Flamed Diving i think you might be the best person to make a thread here to explain in basic terms how the european monetary system works as appose to how the Ct world sees it.
I would hate to think i am being mislead,but i believe The Secret Of OZ theory so far because i understand the basic idea and it appeared to make sense.Im sure its never that simple though.

the country i was thinking of was Germany when they had massive inflation and i think it may have happened in the US too but that is all info from Zeitgeist and i dont fully understand the principles involved in controlling inflation below 2%.

Flamed Diving

Well, the ECB have an 'educational' section, which I presume is for the layperson, why not try that?

http://www.ecb.int/ecb/educational/html/index.en.html

Truthrevolution

Flamed Diving wrote: »

The ECB print (and withdraw) all money for the Eurosystem. The rate that they charge banks for this injection depends on the interest rate they are targeting. So if they are attempting to get banks to charge 5% on mortgages, the ECB will let banks bid for X amount of money, hoping the volume offered is enough to reach X%, leaving the banks a little room to make their profit. The term that the ECB sets on these loans determines whether the volume of money is increasing or decreasing, over time. The interest rate they are targeting depends on the inflation rate they are targeting. This is always 2%, and it is the primary goal for the ECB's existence; to maintain low inflation.

With respect to your opening statement, can you give me an example of a country that had an independent central bank, who had a low inflation target, and wound up with inflation rates of 11,000%?

When governments print their own currency, they tend to use it to pay the bills while running deficits, instead of using tax intake, or issuing bonds. Furthermore, they can pull sneaky tricks using inflation, such as increasing the money supply before an election, to cause a mini-boom to sweep them back into office, only for the inflationary consequences to occur after. The second trick is to issue bonds in your own currency, spend the cash and then increase the money supply, thus reducing the value of the bonds. However, this has a long-term counter productive effect, as people will simply charge higher interest rates for your bonds, when you next seek a loan. If you continue pulling these tricks, it can become easy to get caught in an inflationary spiral, which is very difficult to get out of, and can destroy your economy.

The last place you want the keys to printing money, is in the hands of politicians.

So do you think when Lincon brought in the green backs it was a bad decision?

Torakx

Just to let you guys know i made a thread regarding the that topic just now in the politics-Irish Budget and economy section.
http://www.boards.ie/vbulletin/showthread.php?p=65318197#post65318197
Feel free to join in an educate me or yourselves i certainly need it in this area

Flamed Diving

Truthrevolution wrote: »

So do you think when Lincon brought in the green backs it was a bad decision?

Well, the inevitable happened with the government just printing money to finance the war, which led to massive inflation. Same as always.

bonkey

Having reviewed the past few pages of posting...we seem to be using this thread to discuss anything and everything, only vaguely nodding in the direction of the OP from time to time.

I'm closing the thread on that basis. If anyone wants to spin a thread out of something they felt was a worthwhile discussion here, please PM me and we can see what posts to split out.