Gas prices up, and Obama is still fighting Keystone

[john "teach me how to" dougie]

Sys, (or anyone really) please humor me.  In our system, how does the government introduce currency into the economy?


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computer entry.

[HeinBallz]

Thank you for your literal and incidentally worthless answer.  I challenge you to take the monetary policy debate seriously so that you at least have the opportunity to show fellow readers you're not a complete dunce.

I ask again, how does the us government introduce new money into the economy; where does it come from?


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[Kat Kid]

Thank you for your literal and incidentally worthless answer.  I challenge you to take the monetary policy debate seriously so that you at least have the opportunity to show fellow readers you're not a complete dunce.

I ask again, how does the us government introduce new money into the economy; where does it come from?


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They print money and mint coins, they also issue bonds. . . .

[HeinBallz]

Incorrect.   The federal reserve prints money - which is not a government institution.  When more money is going to be introduced into the economy, the government purchases bonds from the Federal Reserve, at which point they print money and deliver to the U.S. Government to be introduced into the economy.


Question #2:  Does the federal reserve charge the U.S Government interest in this exchange?

[Kat Kid]

Incorrect.   The federal reserve prints money - which is not a government institution.  When more money is going to be introduced into the economy, the government purchases bonds from the Federal Reserve, at which point they print money and deliver to the U.S. Government to be introduced into the economy.


Question #2:  Does the federal reserve charge the U.S Government interest in this exchange?

I dunno man, they do have a .gov website.

http://www.federalreserve.gov/

[HeinBallz]

Anyone else have the answer?


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[HeinBallz]

I didn't mean to scare anyone off - two years ago, I didn't know any of this stuff - so this isn't some sort of chest thumping, I'm right you're wrong.  Just a simple discussion to understand people's perspective on why fiat money has or has not been successful.

Does the federal reserve charge the government interest on these loans?


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[Kat Kid]

http://www.law.cornell.edu/uscode/text/12/chapter-3

federal reserve act.  Man, the conspirators really covered their tracks well on this one.

[HeinBallz]

You didn't answer my question - is there interest involved in the federal reserve printing money for the government?


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[p1k3]

http://www.law.cornell.edu/uscode/text/12/chapter-3

federal reserve act.  Man, the conspirators really covered their tracks well on this one.

I would have thought Kat kid would be more critical of a piece of legislation drawn up in secret by 1%ers on an island no one ever heard of?

[sys]

Sys, (or anyone really) please humor me.  In our system, how does the government introduce currency into the economy?

i don't like it when people ask questions they know the answer to, but i'll play along for now.  a small amount of money is created by the treasury printing/minting currency.  a much greater quantity is created by the federal reserve buying assets and extending loans.  to fund those purchases/loans, they use money that they create out of a push of button, as jdougie stated.  if the assets they purchase are government bonds, then the government pays the fed interest on those bonds (by the way, the fed's profits are transferred back to the federal govt, so bfd).  interesting "private entity", where the entity's directors are appointed by the govt, and its profits are transferred to the govt.

a few equally condescending questions for you - do you understand the impact of deflation on an economy?  do you understand that stable, consistent inflation is a desirable policy goal?  how well do you think the fed has delivered on that goal over the term of the fiat dollar compared to during the gold standard dollar?

the fiat dollar weirdos have been been screaming about runaway inflation ever since the first round of quantitative easing.  it hasn't materialized.  at what point do they go back to the drawing board and try to figure out why their hypothesis hasn't been supported by reality?

[HeinBallz]

So now you're telling me the federal reserve is a non profit organization?  No wonder you think it's a tremendous success.

 The short answer is yes, interest is charged, so my next question is how is that interest paid back? 

And I'm asking questions I know the answer to because everyone is quick to blow this off as conspirators crazy talk, and no one is willing to engage in any conversation.  My irritating questions are challenges to anyone partaking in the equally irritating irrational name calling.


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[Kat Kid]

So now you're telling me the federal reserve is a non profit organization?  No wonder you think it's a tremendous success.

 The short answer is yes, interest is charged, so my next question is how is that interest paid back? 

And I'm asking questions I know the answer to because everyone is quick to blow this off as conspirators crazy talk, and no one is willing to engage in any conversation.  My irritating questions are challenges to anyone partaking in the equally irritating irrational name calling.


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Pro tip:  this isn't a conversation.

[p1k3]

I thought the gov gets profits after share holders (banks) in the Fed get a dividend? Seems like nice way to keep the cartel alive

[HeinBallz]

You're missing my point, if you're paying interest with money that you took a loan out on, you're paying a credit card with another credit card.


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[Fake Sugar Dick (WARNING, NOT THE REAL SUGAR DICK!)]

So now you're telling me the federal reserve is a non profit organization?  No wonder you think it's a tremendous success.

 The short answer is yes, interest is charged, so my next question is how is that interest paid back? 

The Fed is owned by its member banks. Anyone who doesn't know this isn't allowed to comment on the merits of its existence.

Printing currency and buying bonds are two of several ways it debases the value of money. Reserve requirements and fed funds rates are two of the more obvious other ways it manipulates the money supply.

Sys is either extremely lazy or doesn't know what he's talking about. He has added nothing to this futile exchange about the Fed.

B.O. blocking the Keystone is one of the more petty, pathetic and misguided moments of his disastrous and infamously terrible presidency.

[Fake Sugar Dick (WARNING, NOT THE REAL SUGAR DICK!)]

I thought the gov gets profits after share holders (banks) in the Fed get a dividend? Seems like nice way to keep the cartel alive

This is true, Fed profits are distributed to its shareholders, the member banks.  I had never heard of t-bond interest being credited back to the Treasury, someone should confirm the veracity of that statement.

[HeinBallz]

So now you're telling me the federal reserve is a non profit organization?  No wonder you think it's a tremendous success.

 The short answer is yes, interest is charged, so my next question is how is that interest paid back? 

The Fed is owned by its member banks. Anyone who doesn't know this isn't allowed to comment on the merits of its existence.

Printing currency and buying bonds are two of several ways it debases the value of money. Reserve requirements and fed funds rates are two of the more obvious other ways it manipulates the money supply.

Sys is either extremely lazy or doesn't know what he's talking about. He has added nothing to this futile exchange about the Fed.

B.O. blocking the Keystone is one of the more petty, pathetic and misguided moments of his disastrous and infamously terrible presidency.

That was my ace in the hole for anyone blowing off my point about interest being paid back to the federal reserve.   The people arguing that FIAT $$ as being a tremendous success seem to forget how this conversation got started... the debasing of our currency and the declined purchasing power that anyone making under a billion/year has. 

One person may ask how risky deflating 16 trillion dollars may be, I'm asking how risky is it to continue this rate of inflation.  Just because it hasn't effected many of us yet, how long before the middle class disappears entirely and we all join the ranks of poverty stricken dependents?

[Fake Sugar Dick (WARNING, NOT THE REAL SUGAR DICK!)]

Morons that argue that the gold standard is crazy usually don't understand that you can still have a fractional banking system with it.  They literally think that ever dollar accounted for needs a gold bar in Ft Knox.  So Fake Sugar Dick (WARNING, NOT THE REAL SUGAR DICK!).

Not sure if Paulites are against fractional banking. I hope not.

[sys]

Morons that argue that the gold standard is crazy usually don't understand that you can still have a fractional banking system with it.

it's hilarious and Fake Sugar Dick (WARNING, NOT THE REAL SUGAR DICK!) that you think this makes a difference.

[sys]

So now you're telling me the federal reserve is a non profit organization?  No wonder you think it's a tremendous success.

 The short answer is yes, interest is charged, so my next question is how is that interest paid back? 

And I'm asking questions I know the answer to because everyone is quick to blow this off as conspirators crazy talk, and no one is willing to engage in any conversation.  My irritating questions are challenges to anyone partaking in the equally irritating irrational name calling.

i answered your question.  answer mine.

[p1k3]

I thought the gov gets profits after share holders (banks) in the Fed get a dividend? Seems like nice way to keep the cartel alive

This is true, Fed profits are distributed to its shareholders, the member banks.  I had never heard of t-bond interest being credited back to the Treasury, someone should confirm the veracity of that statement.

see i had "heard" of it but just highly doubt it ever happens. Seems like a weak point for Fed apologists to hang their hat on.

Also, as a Paulite i am not againsy fractional reserve banking for obvious reasons. I am against government appointed retards setting all the rules.

[Fake Sugar Dick (WARNING, NOT THE REAL SUGAR DICK!)]

Morons that argue that the gold standard is crazy usually don't understand that you can still have a fractional banking system with it.

it's hilarious and Fake Sugar Dick (WARNING, NOT THE REAL SUGAR DICK!) that you think this makes a difference.

Makes a difference with what?

You've proven your worth, or lack thereof, here.  Hilarious some goons sought out your uninformed and uneducated guidance regarding the Fed and money supply. Like asking the cashier at Dillons for advice on capital markets.

[HeinBallz]

Sys, (or anyone really) please humor me.  In our system, how does the government introduce currency into the economy?

a few equally condescending questions for you - do you understand the impact of deflation on an economy?  do you understand that stable, consistent inflation is a desirable policy goal?  how well do you think the fed has delivered on that goal over the term of the fiat dollar compared to during the gold standard dollar?

I do understand the impact of deflating the economy, do you understand the impact of a collapse of an economy?  That's what FIAT money will always lead to when there is no middle class to support it.  If you don't understand how rapid inflation eliminates the middle class, then you don't understand the basic principles we're talking about.

I also understand that stable consistent inflation is desired, which is a natural occurrence when money has actual value.  When money is not tied to some sort of commodity, it is an issuance of "good faith" and any inflation that takes place is not "stable & or Consistent" and will eventually collapse.  Why? Because it's not based in any value.  The very banks lending this money can make MORE money if the people they're lending money to default on a loan...   I know that may seem hard to believe, because you think money is worth something.   But a house is worth something, a stack of paper is not.  If people aren't willing to pay cash for something, they're left with no other option than to trade their house for a stack of worthless money.   I'm sure you've heard that DEBT = MONEY... that's partially incorrect if you define money as something valuable.  In reality, DEBT = WEALTH. So it's your choice really, a gradual controlled deflation to correct the damage that has been done, or dropping off of a cliff and having the banks own every piece of property, technology, and/or commodity that was being used as collateral.

It will collapse - just as paying off a credit card with another credit card will only work as long as someone is willing to offer you another credit card.  Eventually you'll be holding all the cards,and you'll have nothing but a stack of debt to show for it - and that's when the debt collectors swoop in and take everything you own.   Tremendously successful - not for you or me, but the banks.

Finally, I think the fed delivered as expected, the debasing of the currency as lessened the buying power of the dollar and we're seeing an entire class of society disappear and a growing base of dependents not able to afford basic necessities becoming a drain on society.

If you think unemployment rates & debt being at or near all time highs is success, then I question your motives. 

 

[sys]

Makes a difference with what?

You've proven your worth, or lack thereof, here.  Hilarious some goons sought out your uninformed and uneducated guidance regarding the Fed and money supply. Like asking the cashier at Dillons for advice on capital markets.

i call everyone retards, but you actually are Fake Sugar Dick (WARNING, NOT THE REAL SUGAR DICK!).  be quiet while i messageboard with heinballz.