Gas prices up, and Obama is still fighting Keystone

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be quiet while i messageboard with heinballz.

sys, when are you gonna be somewhere we can all pak again?

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

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.

So pathetic. So sophmoric. So pwn3d.

Cue the goons.

[sys]

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.

when has the fiat dollar produced rapid inflation?  you assert that fiat money will ALWAYS produce economic collapse - provide examples of countries with mature economies and stable democracies that have experienced economic collapse due to fiat currency.  i won't even hold you to always, show evidence that it happens even, say, once every ever.  you state that you do understand the impact of deflation, please state what it is.

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.

how is consistent inflation a natural occurrence of a commodity backed currency?  describe the logical association, or show evidence that there was consistent stable inflation during the centuries when all currencies were commodity backed.

a commodity backed currency is as dependent on good faith as a fiat currency.  participants hold no guarantee other than good faith that an issuer of currency won't remove the commodity backing, or alter its ratio of exchange.

I know that may seem hard to believe, because you think money is worth something.

lol, wtf?  what on earth would make you think i think that?  i'm the one that thinks anyone that stuffs currency in their mattress gets exactly what they deserve when they try to wheelbarrow it in and exchange it for a loaf of bread fifty years later.  you apparently think money should be worth something.  you're wrong, it's a medium of exchange, there's no reason for it to have intrinsic worth.

gradual controlled deflation to correct the damage that has been done, or dropping off of a cliff.

gradual controlled deflation would be the same as dropping off a cliff.

Finally, I think the fed delivered as expected, the debasing of the currency as lessened the buying power of the dollar.

there have been errors, and there have been corruptions from the fed's mandate through political influence.  but you're right, as a whole, it's done very well through the fiat money era.  you're wrong about the buying power of the dollar.  economic growth has outpaced inflation; the buying power of americans has increased over that period.

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

i question your association of an expansionary monetary policy with high unemployment and wealth disparity.

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

Hey look, the uninformed, pseudo-intellectual has resorted to the Socratic method to disguise his ignorance. Insults sure to follow.

[sys]

Hey look, the uninformed, pseudo-intellectual has resorted to the Socratic method to disguise his ignorance. Insults sure to follow.

i would complement you on having the forethought to post only short snippets of thought, limiting the idiocy you can exhibit.  but you managed to show off a pretty good chunk in just two throwaway sentences, so it wouldn't really be appropriate.

[sys]

sys, when are you gonna be somewhere we can all pak again?

frankfurt nazipak?

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

Hey look, the uninformed, pseudo-intellectual has resorted to the Socratic method to disguise his ignorance. Insults sure to follow.

i would complement you on having the forethought to post only short snippets of thought, limiting the idiocy you can exhibit.  but you managed to show off a pretty good chunk in just two throwaway sentences, so it wouldn't really be appropriate.

I'm not sure you aren't talking about yourself here.  I've clowned you on every substantive point we've exchanged in this thread. I'm growing tired of this exercise in who can insult the other in a more articulate manner.  Goodbye.

[HeinBallz]

when has the fiat dollar produced rapid inflation?  you assert that fiat money will ALWAYS produce economic collapse - provide examples of countries with mature economies and stable democracies that have experienced economic collapse due to fiat currency.  i won't even hold you to always, show evidence that it happens even, say, once every ever.  you state that you do understand the impact of deflation, please state what it is.

It's simple, whenever a couple billion dollars is printed up for a mortgage crisis or economy stimulous, the money you have becomes worth less... I don't know how to make that more clear.  And when did we define "once a year" as rapid?  Why couldn't once every 10 years be rapid?  That's less time for the average investment to mature.  So here's my example, Gas averaged 1.73 in  2003.  It now averages well over $3.00 - In that time, as crude relates to something like, oh, lets say gold - the price remained relatively unchanged; proving that the rise in energy has nothing to do with a shortage and everything with your dollar being worth less. 

how is consistent inflation a natural occurrence of a commodity backed currency?  describe the logical association, or show evidence that there was consistent stable inflation during the centuries when all currencies were commodity backed.

a commodity backed currency is as dependent on good faith as a fiat currency.  participants hold no guarantee other than good faith that an issuer of currency won't remove the commodity backing, or alter its ratio of exchange.

Because some commodities become more plentiful.  When the commodity that your currency is tied to becomes more plentiful, your currency becomes worth less, or inflates.   A commodity backed currency is only good faith if you trust that your currency is legitimately backed by that commodity.  If I decide to go to the "bank" and make a withdraw of my "commodity" and provide my receipt (currency) and they do not deliver - It's a corrupt bank as they're writing more "receipts" (currency) than they have to back it.    The difference is, if they are not corrupt, I still have my commodity that is worth something.  In a fiat currency, all I have is a piece of paper that I have to trust the world will continue to honor. When that trust is lost, all I have is a piece of paper.  Take a dollar to the U.S. treasury and ask they exchange it for something with value and they'll try to sell you something. 

lol, wtf?  what on earth would make you think i think that?  i'm the one that thinks anyone that stuffs currency in their mattress gets exactly what they deserve when they try to wheelbarrow it in and exchange it for a loaf of bread fifty years later.  you apparently think money should be worth something.  you're wrong, it's a medium of exchange, there's no reason for it to have intrinsic worth.

It's a medium of exchange because there's still a line of credit.  But that line of credit will eventually dry up as debt expands.  But you're derailing the topic - It SHOULD have worth because it prevents printing in excess making what you have in your pocket worth less.  Are you honestly telling me that you have ALL of your finances wrapped in investments that have intrinsic worth?  Seriously?  If the federal government collapsed in ten years, you could take all of your wealth and exchange it for your everyday necessities?  You have no 401K - No stocks - No savings account - no bonds - nothing?  crap dude, That's where I'd like to be - we should be friends.   We both like KSU, I have a gun, you have a lot of stuff people would kill for in an "end of the US" scenario - even trade.

gradual controlled deflation would be the same as dropping off a cliff.

Disagree.  Tightening lines of credit being loaned out to risky investments is not nearly the same as banks closing their doors.  That's the difference between gradual deflation and dropping off a cliff.

there have been errors, and there have been corruptions from the fed's mandate through political influence.  but you're right, as a whole, it's done very well through the fiat money era.  you're wrong about the buying power of the dollar.  economic growth has outpaced inflation; the buying power of americans has increased over that period.

i question your association of an expansionary monetary policy with high unemployment and wealth disparity.

Economic growth has occurred due to the advent of new technologies making production easier and faster.  Something that lower interest rates have small to almost no effect on.  Stating that the buying power of the dollar has NOT decreased is plain short sighted. In the last 10 years alone, median wages have actually decreased nearly $1000 annually when adjusted for inflation.  Gas prices have doubled - and that's even accounting for inflation.

[sys]

I'm not sure you aren't talking about yourself here.  I've clowned you on every substantive point we've exchanged in this thread. I'm growing tired of this exercise in who can insult the other in a more articulate manner.  Goodbye.

you haven't posted a substantive point.  thank god you're leaving.

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

I'm not sure you aren't talking about yourself here.  I've clowned you on every substantive point we've exchanged in this thread. I'm growing tired of this exercise in who can insult the other in a more articulate manner.  Goodbye.

you haven't posted a substantive point.  thank god you're leaving.

You don't believe in God, douche. Such a weird angry little person.

[Kat Kid]

Hey look, the uninformed, pseudo-intellectual has resorted to the Socratic method to disguise his ignorance. Insults sure to follow.

i would complement you on having the forethought to post only short snippets of thought, limiting the idiocy you can exhibit.  but you managed to show off a pretty good chunk in just two throwaway sentences, so it wouldn't really be appropriate.

I'm not sure you aren't talking about yourself here.  I've clowned you on every substantive point we've exchanged in this thread. I'm growing tired of this exercise in who can insult the other in a more articulate manner.  Goodbye.

   not a chance.

[sys]

It's simple, whenever a couple billion dollars is printed up for a mortgage crisis or economy stimulous, the money you have becomes worth less... I don't know how to make that more clear.

it's perfectly clear.  what isn't clear is why you think it's bad.  i thought we agreed that gradual, stable inflation is good for the economy?  did i miss it somewhere where you provided evidence that current monetary policy is producing rapid inflation?  or dramatic changes in inflation rate?

So here's my example, Gas averaged 1.73 in  2003.  It now averages well over $3.00 - In that time, as crude relates to something like, oh, lets say gold - the price remained relatively unchanged; proving that the rise in energy has nothing to do with a shortage and everything with your dollar being worth less.

your example is one commodity and two random points in time.  why not use use 1.38/gallon in 1981 and 1.34/gallon in 2002?  or we could settle on just using the actual annual rate of inflation.  the chart below illustrates how much more stable, and closer to optimal targets inflation rates have been during the fiat currency era.  bravo, fed.

Because some commodities become more plentiful.  When the commodity that your currency is tied to becomes more plentiful, your currency becomes worth less, or inflates.

sometimes your commodity becomes gradually more plentiful.  sometimes it becomes rapidly more plentiful.  sometimes it becomes relatively more scarce.  with corresponding effects on your currency.  not stable.

The difference is, if they are not corrupt, I still have my commodity that is worth something.  In a fiat currency, all I have is a piece of paper that I have to trust the world will continue to honor. When that trust is lost, all I have is a piece of paper.  Take a dollar to the U.S. treasury and ask they exchange it for something with value and they'll try to sell you something.

in the case of the fiat currency, you trust that the currency issuer will manage monetary supply to produce inflation in line with stated goals and in accordance with historical precedent.  in the case of a commodity backed currency you trust that the currency issuer won't act to change the ratio of exchange.  in both cases you are have no guarantee other than trust in the currency issuer.  what exactly is the difference?

when i take my crisp, clean 2012 dollar to the treasury to see what they'll exchange it for, you should bring a wrinkled, old 1962 silver certificate dollar and see if they offer you anything more valuable than they offer me.

It SHOULD have worth because it prevents printing in excess making what you have in your pocket worth less.

i understand the visceral appeal of this line of thinking.  but just look to the historical data.  it is a false sense of security, the data show that governments will debase commodity backed currencies whenever they need to do so.  while being prevented from using the tools of a fiat currency to promote economic growth.

Are you honestly telling me that you have ALL of your finances wrapped in investments that have intrinsic worth?...

i have plenty of guns, i don't need yours.  my money, aside from what i need for the next month or so, is in productive assets and real wealth.  none of which will have much of any value if society and rule of law collapses.  in such event, i doubt if a pile of gold and gun will provide much more security.  you're unlikely to have the only gun.

Disagree.  Tightening lines of credit being loaned out to risky investments is not nearly the same as banks closing their doors.  That's the difference between gradual deflation and dropping off a cliff.

can we agree that our economy would collapse without capital markets and the ability for entities to borrow money?  if we agree on that, let me ask you a question for our period of gradual deflation.  let's call it 2% annual deflation.  Can I borrow $1000?  i'll pay you back $990 in a year, that's a full 1% over our deflation rate.

Economic growth has occurred due to the advent of new technologies making production easier and faster. 

how many of those new technologies would have been developed as rapidly if companies didn't have access to capital?  how many if consumers weren't stimulated to spend, providing more expansive markets?

In the last 10 years alone...

it's interesting that you always wish to limit the discussion to data from the last decade.  the gold standard was eliminated in 1973.

[sys]

You don't believe in God, douche. Such a weird angry little person.

i'm impressed.  you got at least two, probably three, assertions right.

[Kat Kid]

You don't believe in God, douche. Such a weird angry little person.

i'm impressed.  you got at least two, probably three, assertions right.

I think person woks too, unless....

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You don't believe in God, douche. Such a weird angry little person.

i'm impressed.  you got at least two, probably three, assertions right.

I think person woks too, unless....

No real person is that tall.

[HeinBallz]

it's perfectly clear.  what isn't clear is why you think it's bad.  i thought we agreed that gradual, stable inflation is good for the economy?  did i miss it somewhere where you provided evidence that current monetary policy is producing rapid inflation?  or dramatic changes in inflation rate?

Uh, yeah. I did.  Just because 10 years is rapid to me, and you want something to change overnight doesn't discount my example.

your example is one commodity and two random points in time.  why not use use 1.38/gallon in 1981 and 1.34/gallon in 2002?  or we could settle on just using the actual annual rate of inflation.  the chart below illustrates how much more stable, and closer to optimal targets inflation rates have been during the fiat currency era.  bravo, fed.

Perhaps that one point in time is more relevant because of Glass-Steagall repeal or other easily corruptable banking practices...  Perhaps it has something to do with points in time where an excess of currency was printed.  Your source seems to support my statements.  Bravo Sys.

sometimes your commodity becomes gradually more plentiful.  sometimes it becomes rapidly more plentiful.  sometimes it becomes relatively more scarce.  with corresponding effects on your currency.  not stable.

All of which is irrelevant because it's based on real value, not manipulated value. If there is something driving the market to be stingy with credit - manipulating it to drive risky investment only hurts the market.  I think in the last 10 years we've all seen how stimulus plans & bail-outs have done nothing to stimulate actual growth.  Not only does your stance give the appearance of being a Bush apologist, but an Obama apologist.  So what's the point?  There's no growth because we're at the max - and this bubble can't get any larger.

in the case of the fiat currency, you trust that the currency issuer will manage monetary supply to produce inflation in line with stated goals and in accordance with historical precedent.  in the case of a commodity backed currency you trust that the currency issuer won't act to change the ratio of exchange.  in both cases you are have no guarantee other than trust in the currency issuer.  what exactly is the difference?

when i take my crisp, clean 2012 dollar to the treasury to see what they'll exchange it for, you should bring a wrinkled, old 1962 silver certificate dollar and see if they offer you anything more valuable than they offer me.

The difference is if you have the option to not participate in a commodity backed currency.  I could go around dealing in gold.  Have you heard of "mountain hours"?  People out there successfully deal in currencies other than US dollars and they're successful because their currencies have some intrinsic value.

i understand the visceral appeal of this line of thinking.  but just look to the historical data.  it is a false sense of security, the data show that governments will debase commodity backed currencies whenever they need to do so.  while being prevented from using the tools of a fiat currency to promote economic growth.

Look at history and you'll see their fail-safe for promoting economic growth often involves war.  How is that self sustaining?  Oops... better take this argument to the conspiracy theory thread.   Seriously though - debasing commodity backed currency?  Here's a list of ways I can think of that happening in history: Eliminating commodity backing; reducing the gold/silver content in coins; a couple hundred years ago, they would actually trim slivers of gold/silver from coins to mint new coins - which is not much different than printing money; aaaanddd.   that's pretty much it.  Oh wait... You're talking about Fractional Reserve Lending - This can be a problem in conversations of debasing $$.   Here's the problem though and how Fractional Reserve Lending compounds onto itself creating enormous problems.  Let's say we have newly minted $10 million in change and the bank is only required to keep 1 million on hand.   So 9 Million is loaned out - and lets just say that 9 million ends up in another bank, who those banks can lend out, because of fractional lending, roughly 8.3 million.  So it would appear it's not just 9 million that has been created out of thin air, it's 17.3 million created out of thing air.   And that's just after two transactions.  Allow the fractional lending to run it's course and what this does is inflate the currency at what I call rapid - and something you still won't acknowledge reduces buying power.  Below, you complain about borrowing $1000 and pay back $990, but that's exactly what we're doing.  It's creating debt.  Would you agree we're in a debt crisis?  We've isolated the problem - why are people being so defiant to address the issue?

i have plenty of guns, i don't need yours.  my money, aside from what i need for the next month or so, is in productive assets and real wealth.  none of which will have much of any value if society and rule of law collapses.  in such event, i doubt if a pile of gold and gun will provide much more security.  you're unlikely to have the only gun.

Gold throughout recorded and unrecorded history has ALWAYS had value.  The U.S. dollar has only had value for a couple hundred years.

can we agree that our economy would collapse without capital markets and the ability for entities to borrow money?  if we agree on that, let me ask you a question for our period of gradual deflation.  let's call it 2% annual deflation.  Can I borrow $1000?  i'll pay you back $990 in a year, that's a full 1% over our deflation rate.

  How about I loan you $1000 worth of gold, and you pay me back $1010 worth of gold.  If it's a worthy investment, you'll take the risk, as would I.

how many of those new technologies would have been developed as rapidly if companies didn't have access to capital?  how many if consumers weren't stimulated to spend, providing more expansive markets?

  Fail.  Capital is needed for production, not invention. If an idea/concept/prototype is a worthy investment, capital will be found. You make it sound like Ford just couldn't get off the ground because no one could print a crap load of money to get assembly lines off the ground. PERHAPS, though - If capital were more difficult to come by, risky investments wouldn't occur so often; certainly preventing the housing bubble - GM bail-outs, etc. etc.   

it's interesting that you always wish to limit the discussion to data from the last decade.  the gold standard was eliminated in 1973.

It is interesting, isn't it?

[HeinBallz]

BTW Sys, I respect you more for not believing in God - It shows you have the ability to ask questions and look for logical answers.  Not that you should care, I just thought you should know.

[ednksu]

I've remarkable enjoyed the contribution Heinz is making in this thread.  I'm about to bottle his mind: gold has no intrinsic value. 
Is FSD still drooling on himself?  Someone should check on him.

[HeinBallz]

I've remarkable enjoyed the contribution Heinz is making in this thread.  I'm about to bottle his mind: gold has no intrinsic value. 
Is FSD still drooling on himself?  Someone should check on him.

My mistake for not fully understanding the definition of intrinsic.   My sincere apologies - It's not a word I use often, but I have googled it and the mistake shall not happen again.

I hope the admittance of my ignorance doesn't "boggle" your mind. 

[sys]

heinballz.  i've kind of run out of energy with this discussion.  it's hard to debate when you have to continually reframe a discussion you thought had already been framed.

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heinballz.  i've kind of run out of energy with this discussion.  it's hard to debate when you have to continually reframe a discussion you thought had already been framed.

Yeah, move on.  There's a murdering iowan over on the combo board.

[HeinBallz]

heinballz.  i've kind of run out of energy with this discussion.  it's hard to debate when you have to continually reframe a discussion you thought had already been framed.

Agreed... considering I started the conversation, framed it... and oh well.   Have a good evening.

[sys]

dude, you essentially refuse to acknowledge reality.  it's impossible to converse with someone whose idea of a meaningful rebuttal is:  "well, it's rapid to me".  have a good evening as well.

[HeinBallz]

last word.     

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

Let me get something straight. The Fed, which in its current state is powerful enough to manipulate the largest capital market in the world, but is incapable of preventing the decline in value of a single commodity?  That's rough ridin' Fake Sugar Dick (WARNING, NOT THE REAL SUGAR DICK!).  Thanks Sys.

Heinballs, why does currency have to be backed by a single commodity, why not a basket of commodities, thereby reducing aggregate volatility?

Maybe you guys can find a middle somewhere.