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COTW two-fer, starting with an anecdote from Jay Fink:

The welfare state is seducing people who have never had experience with it before. I am friends with a Chinese-American man who is collecting unemployment with the $600 weekly bonus. He always had a strong work ethic and never took a government handout before. At first he thought the lockdowns were a bad overreaction. He wanted to go back to work. Then the unemployment plus bonus started rolling in and he completely changed his tune. He now thinks for the safety of all everything should remain closed for as long as possible.

These unemployment-plus benefits are in place through July. Does anyone think that, three months out from the general election, anyone from either party is going to oppose extending them through the end of the year, or of even making them permanent?

If we wanted to conjure up a story of how UBI would go from pipe dream to permanent fixture of the American economic landscape, could we do a better job than coronavirus is doing?

Elmer’s Washable School Glue–chortle!–on those silly sound money goldbuggers (it is a soft metal, after all):

Gold is also a fiat currency. The industrial demand for gold does nothing to justify even a fraction of its price. The only reason it is valuable is because everyone has agreed that it should be considered valuable. Not any different than the dollar except that it is harder to create more gold than dollars.

What goldbugs don’t seem to understand is that currency should be valueless, precisely so that it can serve as an independent means of exchange. Fiat currency has only one value: that which has been agreed on. “Backed” currency has two values: the value of the underlying asset, plus a premium based on its value of exchange.

If you’re whining about currency volatility now, imagine how much worse it would be if tied to something with variable “useful” demand like grain or (lol) oil? Gold serves as a decent currency specifically because it is mostly useless, but it does have some minor uses so truly valueless currency is still better.

For something to function as currency it must have a perceived monetary premium exceeding its specific industrial, artistic, or status-signalling utility. If it lacks this attribute, it is merely a barterable good. Gold isn’t quite the Methuselah of money–that honor belongs to silver–but it has an impressively long track record all the same.

Gold serves as a decent currency not because it is mostly useless, but because it can neither be created nor destroyed. In that way it fundamentally differs from fiat currencies, crypto, debt instruments, equities, and all other financial assets.

The cost of transaction compliance is the biggest obstacle this gold faces in re-entering the commercial economy in a significant way. Think Venmo, but for gold. If negative interest rates become normalized, the incentive to overcome said obstacle will be even bigger than the obstacle itself. Gold as a salient political issue is not just in the past–it’s in the future, too.

 
• Category: Culture/Society, Economics, Ideology • Tags: COTW 
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  1. I am going to look at gold mining stocks tomorrow. What are the mining margins when oil is free and gold has a high price?

    • Replies: @LondonBob
    Just broke out on the XAU and GDX, so I wouldn't take too long.

    https://kingworldnews.com/michael-oliver-4-25-2020/

    Michael Oliver thinks some of the states will run out of money to pay benefits soon, and the possibility people don't file tax returns.
    , @Realist

    I am going to look at gold mining stocks tomorrow.
     
    Best to own the metal.
    , @Audacious Epigone
    The big question mark is whether or not the various mines will get hit hard enough by coronavirus shutdowns to be taken down by credit/cash flow problems. Some mining companies are going to do well.
  2. Libertarians who advocate both the gold standard and the general cornucopianism of natural resources apparently don’t see that these ideas make contradictory assumptions about Element 79 in the Periodic Table. What if some combination of technological breakthroughs turned gold into a throwaway commodity, like what has happened to aluminum over the last 200 years?

    Also gold depends on political construction to have “value.” If our government refused to recognize gold as a form of property, and it didn’t arrest and prosecute people who take anything made of gold without the original possessor’s consent, then libertarians would see pretty quickly what their “sound money” amounts to.

    • Replies: @YetAnotherAnon
    "What if some combination of technological breakthroughs turned gold into a throwaway commodity, like what has happened to aluminum over the last 200 years?"

    A lot of people have put a lot of cash into finding it the old fashioned way - I guess as Greenland gets warmer something may be found there - but all the existing alternative methods - sea water, modern alchemy (lead into gold via nuclear reactions) are, while practicable, prohibitively expensive.

    https://chemistry.stackexchange.com/questions/15541/turn-lead-into-gold-via-radioactive-decay

    I guess if someone found a secret method, it might leak eventually, but in the meantime the discoverer, if discreet, could become very wealthy.

    , @Achmed E. Newman

    What if some combination of technological breakthroughs turned gold into a throwaway commodity, like what has happened to aluminum over the last 200 years?
     
    The chemistry is known. This is not the computer world where software can do anything you want, so long as there's not Newton's laws or the laws of Thermo involved, as in, something REAL. Tiny amounts of gold can likely be made in nuclear reactions, but is that worth it? No. It's better to get it out of the ground*, which still costs a lot, pretty much setting the upper limit on the price. i.e., if it's at $2,500/oz and you can dig it out tons and tons of it at $1,500/oz, then that $2,500 won't stick.

    If our government refused to recognize gold as a form of property, and it didn’t arrest and prosecute people who take anything made of gold without the original possessor’s consent, then libertarians would see pretty quickly what their “sound money” amounts to.
     
    Believe you me, AA, we'd LUV LUV LUV to see them try that. What's the reason the government won't stop interfering in people trying to do transactions in gold? That makes you think, doesn't it? This Libertarian would be all in, so go ahead, make my day!


    .

    * An interesting thought experiment is to contemplate a observation made by astronomers that determined with high certainty that there was gold on some asteroid. (You know it'd be a lot, too!). Once plans were made for some unmanned missions, and the costs estimated, the value of gold here on Earth would accommodate that price, and I wonder if it would get down to a point where the missions would barely be worth doing.

    That's different from the 16th (?) century taking of all that gold from the Incas and Aztecs and such. Back then, information didn't flow quite as easily. As far as I know, that was the only time in history in which there was a big enough increase in the REAL MONEY supply to bring down its value as currency.

    , @Dutch Boy
    The main appeal of gold to libertarians is that gold as currency is deflationary. Deflation favors creditors over debtors and libertarian economics is just an ideological defense of the creditor class.
    , @Audacious Epigone
    The search for a way to mine gold predates alchemy. It could happen. So could viable nuclear fusion or successful strategies for engineered negligible senescence. I suspect the global credit market will have long since unraveled before any of these things occur, though.
    , @76239
    Gold and silver were chosen as money long before central banks or central governments. Therefore, it does not need government approval to have value. They are the true people's money because the people chose them as money.

    If someone had lots of gold, the best thing to happen to them would be if the government made gold illegal to possess. Its value would sky rocket. Just because gold would be illegal wouldn't mean people wouldn't buy it like they buy any other illegal commodity.

    You are much like many of these writers on UNZ on Corona, they watch waay to much TV and believe far too much government bull shit to be any value.
  3. In my own view, the US already consumes far too much useless junk. Shopping malls are just the place where people buy these thing publicly. Amazon is where they buy them online. How much of this stuff do we really need? Very little actually.

    Ironically, we are buying most of this crap from China, the same slugs that gave us this illness. What I would like to see come out of this would be to force manufactures to clearly place a big stamp on the item where a product was produced. I would like to see this on line as well. Amazon makes it very had to find out the actual nation of origin. This way if we ever go to war, the Chinese will know that Americans will never buy an overpriced piece of plastic from them ever again.

    • Replies: @Daniel H
    What I would like to see come out of this would be to force manufactures to clearly place a big stamp on the item where a product was produced.

    1) Products sold in the USA already have to indicate country of origin.

    2) To the American consumer, wouldn't make a damn bit of difference. The American has little sense of national solidarity. Every man/woman in this country is out for themselves. Pay a little more so that manufacturing could be done in America? Hell no. Get outta' my way. I want it cheap. We can only achieve industrial production in the USA if it is mandated by law. We must end free trade as national policy. Forcing consumers to pay more must be done through the mandate of law.
    , @Kratoklastes
    Define 'useless' and 'junk'.

    To take an example: in my taxonomy, anyone who owns a 'hard-copy' book, owns junk. That's true even if it's a hard-cover, hard-copy of "Common Sense" or "Human Action" or "The Road to Serfdom" or "Ukridge" (yes, even Ukridge, I'll trouble you!) - all of which I own in both physical and electronic form.

    Those of us who take the big, broad, flexible outlook know that it makes much more sense to have a searchable repository of five thousand e-books rather than a whole wall wasted on a limited, non-searchable (fixed font... primitives) paper versions.


    Is my Oculus Go "junk"? Not to me (and 'twas my money was spent on it).


    As to yon Chinese: if the US was stupid enough to start a war with the Chinese, the economic carnage would be beyond human comprehension. The US relies critically on the Chinese to absorb new US government debt: without Chinese accumulation of US Treasuries, US mortgage rates would be in the double-digits, and more than half the US corporate bonds would default.
    , @dfordoom

    In my own view, the US already consumes far too much useless junk.
     
    There's an edge of Puritanism to that. It's a bit moralistic. And there's also a hint of telling people what they should and should not buy. One man's useless junk is another man's vital necessity. Personally I'd prefer to be free to decide to buy whatever I want as long as I can afford it. I'm sure most of the things I buy would be regarded as useless junk by most people but I don't care I'm gonna buy 'em anyway.

    Asceticism is fine if it's freely chosen. Most people aren't going to choose it. They're going to resent anyone who tries to impose it on them. Talk to political leaders who tried to impose austerity programs on their populations. They're now ex-political leaders.

    Damn, it's so embarrassing to me recently finding myself making libertarian arguments all the time.
  4. @Prof. Woland
    In my own view, the US already consumes far too much useless junk. Shopping malls are just the place where people buy these thing publicly. Amazon is where they buy them online. How much of this stuff do we really need? Very little actually.

    Ironically, we are buying most of this crap from China, the same slugs that gave us this illness. What I would like to see come out of this would be to force manufactures to clearly place a big stamp on the item where a product was produced. I would like to see this on line as well. Amazon makes it very had to find out the actual nation of origin. This way if we ever go to war, the Chinese will know that Americans will never buy an overpriced piece of plastic from them ever again.

    What I would like to see come out of this would be to force manufactures to clearly place a big stamp on the item where a product was produced.

    1) Products sold in the USA already have to indicate country of origin.

    2) To the American consumer, wouldn’t make a damn bit of difference. The American has little sense of national solidarity. Every man/woman in this country is out for themselves. Pay a little more so that manufacturing could be done in America? Hell no. Get outta’ my way. I want it cheap. We can only achieve industrial production in the USA if it is mandated by law. We must end free trade as national policy. Forcing consumers to pay more must be done through the mandate of law.

    • Replies: @Realist

    Forcing consumers to pay more must be done through the mandate of law.
     
    Sounds like a plan everyone would love.
    , @Neuday

    Forcing consumers to pay more must be done through the mandate of law.
     
    Back in the 90's the Chinese government bought themselves Most Favored Nation trade status. All we'd have to do is revoke that status.

    Back in 1997, when Democrats defended union workers before they figured out that electing a new people was the path to power, Nancy Pelosi wanted MFN revoked. Here's the title of the press release.

    Statement of Representative Nancy Pelosi Anouncing Coalition Working To Revoke Most Favored Nation Trade Status for China

    https://pelosi.house.gov/sites/pelosi.house.gov/files/pressarchives/releases/mfn97pr.htm

    , @Rosie

    To the American consumer, wouldn’t make a damn bit of difference.
     
    You're not going to get consumers to subsidize an overpaid (compared to the rest of the country) manufacturing sector. You have to have a semblance of economic equality to get them to do that. Why should a waitress barely making it on a third of a factory worker's salary pay premium to keep him in a job?

    I suspect UBI would alleviate this problem. People who know they'll have a source of income bo matter what are going to be less likely to pinch pennies o the detriment of their compatriots, I would assume.
  5. @Prof. Woland
    In my own view, the US already consumes far too much useless junk. Shopping malls are just the place where people buy these thing publicly. Amazon is where they buy them online. How much of this stuff do we really need? Very little actually.

    Ironically, we are buying most of this crap from China, the same slugs that gave us this illness. What I would like to see come out of this would be to force manufactures to clearly place a big stamp on the item where a product was produced. I would like to see this on line as well. Amazon makes it very had to find out the actual nation of origin. This way if we ever go to war, the Chinese will know that Americans will never buy an overpriced piece of plastic from them ever again.

    Define ‘useless’ and ‘junk’.

    To take an example: in my taxonomy, anyone who owns a ‘hard-copy’ book, owns junk. That’s true even if it’s a hard-cover, hard-copy of “Common Sense” or “Human Action” or “The Road to Serfdom” or “Ukridge” (yes, even Ukridge, I’ll trouble you!) – all of which I own in both physical and electronic form.

    Those of us who take the big, broad, flexible outlook know that it makes much more sense to have a searchable repository of five thousand e-books rather than a whole wall wasted on a limited, non-searchable (fixed font… primitives) paper versions.

    Is my Oculus Go “junk”? Not to me (and ’twas my money was spent on it).

    As to yon Chinese: if the US was stupid enough to start a war with the Chinese, the economic carnage would be beyond human comprehension. The US relies critically on the Chinese to absorb new US government debt: without Chinese accumulation of US Treasuries, US mortgage rates would be in the double-digits, and more than half the US corporate bonds would default.

    • Replies: @Justvisiting
    E-books are great--until the censors start deleting parts or all of the electronic books deemed too sensitive for human consumption.

    Most of my print library would be censored for a thousand reasons in a future dystopia--racist, sexist, homophobe, anti-government, etc etc etc--and most of it is science fiction.
    , @obwandiyag
    Back when my grandfather bought his house, you had to put 50% down.

    But then the government stepped in and subsidized home loans. The buying of your home, no doubt, was subsidized by the US government. Unless you got $100,000 or 2 lying around to cough up with money left over to eat with. (Maybe you're rich and do got it, I don't know. But don't tell me you are, because I won't believe you.)

    Maybe we should go back to 50%. It would concentrate the minds of these libertarian shoot-their-own-selves-in-the-footers quite nicely.
  6. @DanHessinMD
    I am going to look at gold mining stocks tomorrow. What are the mining margins when oil is free and gold has a high price?

    Just broke out on the XAU and GDX, so I wouldn’t take too long.

    https://kingworldnews.com/michael-oliver-4-25-2020/

    Michael Oliver thinks some of the states will run out of money to pay benefits soon, and the possibility people don’t file tax returns.

  7. @Prof. Woland
    In my own view, the US already consumes far too much useless junk. Shopping malls are just the place where people buy these thing publicly. Amazon is where they buy them online. How much of this stuff do we really need? Very little actually.

    Ironically, we are buying most of this crap from China, the same slugs that gave us this illness. What I would like to see come out of this would be to force manufactures to clearly place a big stamp on the item where a product was produced. I would like to see this on line as well. Amazon makes it very had to find out the actual nation of origin. This way if we ever go to war, the Chinese will know that Americans will never buy an overpriced piece of plastic from them ever again.

    In my own view, the US already consumes far too much useless junk.

    There’s an edge of Puritanism to that. It’s a bit moralistic. And there’s also a hint of telling people what they should and should not buy. One man’s useless junk is another man’s vital necessity. Personally I’d prefer to be free to decide to buy whatever I want as long as I can afford it. I’m sure most of the things I buy would be regarded as useless junk by most people but I don’t care I’m gonna buy ’em anyway.

    Asceticism is fine if it’s freely chosen. Most people aren’t going to choose it. They’re going to resent anyone who tries to impose it on them. Talk to political leaders who tried to impose austerity programs on their populations. They’re now ex-political leaders.

    Damn, it’s so embarrassing to me recently finding myself making libertarian arguments all the time.

    • Agree: Mark G.
    • Replies: @Mark G.

    One man’s useless junk is another man’s vital necessity.
     
    Different strokes for different folks, to each his own, your mileage may vary, there is no accounting for taste, Jack Spratt could eat no fat and his wife could eat no lean, one man's meat is another man's poison, chacun a son gout, de gustibus non est disputandum.
    , @Achmed E. Newman

    Damn, it’s so embarrassing to me recently finding myself making libertarian arguments all the time.
     
    There's nothing embarrassing about seeing the light, DforDoom.

    https://www.youtube.com/watch?v=7ATBbrfmzc0
  8. AE, I’m afraid your understanding of money is limited. Money does not require a perceived premium that exceeds its utility. In fact quite the opposite. Something can become money when it can be exchanged for other trade goods cheaply, the cheaper the better. Ideally money has zero value in itself.

    Real bills and checks are examples of this. Someone with a supply of something issues a note to take possession of it at a future date. Could be trade goods sitting on a ship at dock, could be the grain in a silo, or even a potential crop in the future. Could be tomorrow, next week, or months later. That bill circulates and is traded as a substitute of future value.

    That’s right, the origin of paper money. Not even fiat sovereign money. It’s real. It works fine.

    You tout gold because it can’t be created but that is its huge flaw. Its supply cannot be increased to meet the demands of expanding trade. The lack of money supply constantly restricts trade. Worst of all, it empowers money holders to be a parasite class on the productive economy, empowered by the usury necessary to get money into supply.

    No one would ever go back to a gold backed money supply. It’s like trying to sell a return to horses instead of cars, a huge step back wards. It’s nonsensical.

    You aren’t on the vanguard of monetary theory here. You are simply an intellectual stooge of a reactionary money power. Educate yourself. It’s worth it. Free your mind. The truth shall set you free.

    • Agree: Exile
    • Replies: @Realist

    No one would ever go back to a gold backed money supply.
     
    The reason Nixon ended of the gold standard in America on August 15, 1971 was to allow the unhampered printing of fiat currency. Intelligent people would gladly go to a gold backed money supply.

    If fiat currency is so wonderful why not print 100 million dollars for everybody?

    , @Mr. Rational

    You tout gold because it can’t be created but that is its huge flaw. Its supply cannot be increased to meet the demands of expanding trade.
     
    If anyone can create money, that money has no value.  For anything, including as a medium of exchange.  If I could conjure a million dollars out of thin air with no effort, I could buy cars, buildings, airplanes and even yachts that took great effort to make... at least until the owners got wise and refused to take dollars in exchange for actual goods.

    To be worthwhile as money, it must be difficult or impossible to counterfeit.  That is the weakness of all fiat currencies, and why all of them collapse.  After the dollar is gone, Bitcoin will still be around.
    , @prime noticer
    "The lack of money supply constantly restricts trade."

    i have never found this to be a totally convincing argument. the metal system is not perfect, but it's better than the paper system in a lot of ways. metal money supply has issues, but they are less bad than paper money supply issues, in my opinion.

    also, they used several metals for money, not only gold. mining was the primary source of new money, and per French economist Michel Chevalier, when a new mine opened, the money supply got kind of messed up for a while, and the new supply of metal wasn't a benefit for everybody equally. but eventually those effects worked themselves out.

    that they're not able to fake the metal remains the main reason to use metal. that paper can be, and is always faked, is the main problem with it. modern tech makes this difference between metal and fiat much worse. with modern tech, it's nearly impossible to fake or fraud the metal, as people did 1000 years ago. but once fiat becomes digital, the opportunity to fake it goes logarithmic.

    the main problem with metal remains that moving metal around is a hassle. not the supply of metal.

    "Worst of all, it empowers money holders to be a parasite class on the productive economy"

    this is just nuts, as far as i can tell. how would you describe year 2020 central banker jews then, exactly? doesn't 'Money printer go brrrrrr' create a trillion times more opportunity for this versus metal? that wasn't a number pulled out of thin air. isn't the size and scope of the parasite class increased by 12 orders of magnitude by the current system?

    , @Audacious Epigone
    The physical utility of a federal reserve note is virtually nil--it's just a piece of paper. There is a huge premium placed on it, though, that is unrelated to its physical characteristics. There's no disagreement here.

    What you deem parasitic "money holders" many other deem "savers". The reason our liberties are being effortlessly taken away from us at the moment because there are vanishingly few said savers in the US. That's how they get away with putting a $1200 piece of cheese in the 1990s Russia-style 'relief bill' and having everyone eagerly sign on.

    As for my putative stoogery, I'm fortunate to have not listened to many who personally advised against exiting the equity markets nearly in full last summer after getting spooked by the repo freeze up and putting the majority of that into metals. I sidestepped a freight train.

  9. @advancedatheist
    Libertarians who advocate both the gold standard and the general cornucopianism of natural resources apparently don't see that these ideas make contradictory assumptions about Element 79 in the Periodic Table. What if some combination of technological breakthroughs turned gold into a throwaway commodity, like what has happened to aluminum over the last 200 years?

    Also gold depends on political construction to have "value." If our government refused to recognize gold as a form of property, and it didn't arrest and prosecute people who take anything made of gold without the original possessor's consent, then libertarians would see pretty quickly what their "sound money" amounts to.

    “What if some combination of technological breakthroughs turned gold into a throwaway commodity, like what has happened to aluminum over the last 200 years?”

    A lot of people have put a lot of cash into finding it the old fashioned way – I guess as Greenland gets warmer something may be found there – but all the existing alternative methods – sea water, modern alchemy (lead into gold via nuclear reactions) are, while practicable, prohibitively expensive.

    https://chemistry.stackexchange.com/questions/15541/turn-lead-into-gold-via-radioactive-decay

    I guess if someone found a secret method, it might leak eventually, but in the meantime the discoverer, if discreet, could become very wealthy.

  10. @DanHessinMD
    I am going to look at gold mining stocks tomorrow. What are the mining margins when oil is free and gold has a high price?

    I am going to look at gold mining stocks tomorrow.

    Best to own the metal.

  11. @Jedi Night
    AE, I'm afraid your understanding of money is limited. Money does not require a perceived premium that exceeds its utility. In fact quite the opposite. Something can become money when it can be exchanged for other trade goods cheaply, the cheaper the better. Ideally money has zero value in itself.

    Real bills and checks are examples of this. Someone with a supply of something issues a note to take possession of it at a future date. Could be trade goods sitting on a ship at dock, could be the grain in a silo, or even a potential crop in the future. Could be tomorrow, next week, or months later. That bill circulates and is traded as a substitute of future value.

    That's right, the origin of paper money. Not even fiat sovereign money. It's real. It works fine.

    You tout gold because it can't be created but that is its huge flaw. Its supply cannot be increased to meet the demands of expanding trade. The lack of money supply constantly restricts trade. Worst of all, it empowers money holders to be a parasite class on the productive economy, empowered by the usury necessary to get money into supply.

    No one would ever go back to a gold backed money supply. It's like trying to sell a return to horses instead of cars, a huge step back wards. It's nonsensical.

    You aren't on the vanguard of monetary theory here. You are simply an intellectual stooge of a reactionary money power. Educate yourself. It's worth it. Free your mind. The truth shall set you free.

    No one would ever go back to a gold backed money supply.

    The reason Nixon ended of the gold standard in America on August 15, 1971 was to allow the unhampered printing of fiat currency. Intelligent people would gladly go to a gold backed money supply.

    If fiat currency is so wonderful why not print 100 million dollars for everybody?

    • Replies: @Daniel H
    If fiat currency is so wonderful why not print 100 million dollars for everybody?

    It seems that the Fed would eagerly print 100 million per capita. It's just that such money will be distributed only to their favorites, the Wall Street banks.
    , @EldnahYm
    Wrong. The U.S. fiscal policy had almost nothing to do with gold. The gold standard of that time was simply an agreement that other countries, which fixed the value of their currency to the U.S. dollar, could exchange their dollar holdings for gold at a fixed price. The U.S. already had the ability to print as much fiat currency as it wanted. Not that that matters much, monetary policy without fiscal support is toothless.

    If fiat currency is so wonderful why not print 100 million dollars for everybody?
     
    If fiat currency is so terrible why haven't incompetent governments already printed 100 million dollars and instituted $100 million handouts for everybody?

    Inflation is one answer to your question. Another is that there is no political will or reason to hand out 100 million dollars for everybody. If everyone has 100 million dollars, 100 million dollars is worthless. You should be able to answer this question yourself however.

  12. Not any different than the dollar except that it is harder to create more gold than dollars.

    That’s a pretty huge “except” considering that’s the entire point!

    • Agree: Audacious Epigone
  13. @Daniel H
    What I would like to see come out of this would be to force manufactures to clearly place a big stamp on the item where a product was produced.

    1) Products sold in the USA already have to indicate country of origin.

    2) To the American consumer, wouldn't make a damn bit of difference. The American has little sense of national solidarity. Every man/woman in this country is out for themselves. Pay a little more so that manufacturing could be done in America? Hell no. Get outta' my way. I want it cheap. We can only achieve industrial production in the USA if it is mandated by law. We must end free trade as national policy. Forcing consumers to pay more must be done through the mandate of law.

    Forcing consumers to pay more must be done through the mandate of law.

    Sounds like a plan everyone would love.

    • Replies: @Daniel H
    Sounds like a plan everyone would love.

    To return manufacturing to America, to create better quality jobs, to lessen income inequality, it would be worth it that the consumer pays a little more.
  14. Wasn’t some form of this inevitable with automation, anyway? If so, then coronavirus is just opening the Overton Window a bit early.

    • Replies: @Audacious Epigone
    That's my take on both UBI and the unwinding of the global credit system--both were coming, but coronavirus was the ultimate accelerationist.
  15. Gold serves as a decent currency not because it is mostly useless, but because it can neither be created nor destroyed.

    Not entirely true: The world was flooded with gold in the 1850s, and that would have led to serious inflation if that had not been severely offset by Industrial Revolution increases in productivity that led to the so-called Great Deflation from 1870 to 1890.

    Here’s an interesting contemporary take on gold.

    https://archive.org/stream/aseriousfallinv00jevogoog#page/n10/mode/2up

    • Replies: @Oo-ee-oo-ah-ah-ting-tang-walla-walla-bing-bang
    More spectacularly with the Spanish New World discoveries. In the 1500s gold plummeted so hard Spain basically went bankrupt while simultaneously having more gold than anyone thought imaginable even a few decades prior
  16. WUHAN-19 virus leading to UBI is the worst case scenario.

    And, there is a good countermeasure. Paying UBI to the unemployed means there are many employable people in the coubtry. Therefore, the U.S. does not need to import more people. The Elite SJW Globalist attempt at UBI, could easily backfire if it gives Trump sufficient cover to end H1B/OPT.
    _____

    WUHAN-19 leading to disengagement from China is the best case scenario.

    Not only is this outcome positive for the U.S. It is already happening. (1)

    a U.S.-based rare-earth materials mining company, MP Materials, was granted a U.S. Department of Defense contract to begin the process of bringing the mining of these elements back to the U.S. and away from China, which had been producing roughly 80% of the world’s supply. These elements are crucial in the development of technological products, notably in high-tech security and defense systems, and the move to bring the supply chain home is a hallmark of a great exodus of business and manufacturing out of mainland China, and not just by the U.S.

    PEACE 😷
    _______

    (1) https://townhall.com/tipsheet/sarahlee/2020/04/24/a-great-business-exodus-from-china-n2567594

    • Replies: @Achmed E. Newman
    Thanks, A123. I never thought Socialism would ramp up this quick, but they have not been wasting this purported "crisis". I'll give 'em all credit for that, as evil as it is. Both the Socialists with their putting half the country on the dole, and the other Totalitarians, with their LOCKDOWNS and SHELTER-IN-PLACES and other bullshit, have taken full advantage.

    I never thought I'd get that pissed about this, but when I saw my power bill, with their message about power not being turned off for non-payment, that got me really thinking yesterday. Being a responsible person will no longer pay in this country! I really don't know what the plan for me and my family will be now.

    If that last paragraph sounds hyperbolic, well, this stuff is really coming to a head now. All these dense-headed Socialists will only learn the lesson when it's too late. The more that responsible people are screwed over left and right, the fewer responsible people there will be left. How do you come out of that?

    A.E., thank you for the posts on the financial aspect of this Kung Flu Infotainment Panic Fest. This is a MUCH BIGGER deal than the issue of the virus itself.
  17. @dfordoom

    In my own view, the US already consumes far too much useless junk.
     
    There's an edge of Puritanism to that. It's a bit moralistic. And there's also a hint of telling people what they should and should not buy. One man's useless junk is another man's vital necessity. Personally I'd prefer to be free to decide to buy whatever I want as long as I can afford it. I'm sure most of the things I buy would be regarded as useless junk by most people but I don't care I'm gonna buy 'em anyway.

    Asceticism is fine if it's freely chosen. Most people aren't going to choose it. They're going to resent anyone who tries to impose it on them. Talk to political leaders who tried to impose austerity programs on their populations. They're now ex-political leaders.

    Damn, it's so embarrassing to me recently finding myself making libertarian arguments all the time.

    One man’s useless junk is another man’s vital necessity.

    Different strokes for different folks, to each his own, your mileage may vary, there is no accounting for taste, Jack Spratt could eat no fat and his wife could eat no lean, one man’s meat is another man’s poison, chacun a son gout, de gustibus non est disputandum.

  18. @advancedatheist
    Libertarians who advocate both the gold standard and the general cornucopianism of natural resources apparently don't see that these ideas make contradictory assumptions about Element 79 in the Periodic Table. What if some combination of technological breakthroughs turned gold into a throwaway commodity, like what has happened to aluminum over the last 200 years?

    Also gold depends on political construction to have "value." If our government refused to recognize gold as a form of property, and it didn't arrest and prosecute people who take anything made of gold without the original possessor's consent, then libertarians would see pretty quickly what their "sound money" amounts to.

    What if some combination of technological breakthroughs turned gold into a throwaway commodity, like what has happened to aluminum over the last 200 years?

    The chemistry is known. This is not the computer world where software can do anything you want, so long as there’s not Newton’s laws or the laws of Thermo involved, as in, something REAL. Tiny amounts of gold can likely be made in nuclear reactions, but is that worth it? No. It’s better to get it out of the ground*, which still costs a lot, pretty much setting the upper limit on the price. i.e., if it’s at $2,500/oz and you can dig it out tons and tons of it at $1,500/oz, then that $2,500 won’t stick.

    If our government refused to recognize gold as a form of property, and it didn’t arrest and prosecute people who take anything made of gold without the original possessor’s consent, then libertarians would see pretty quickly what their “sound money” amounts to.

    Believe you me, AA, we’d LUV LUV LUV to see them try that. What’s the reason the government won’t stop interfering in people trying to do transactions in gold? That makes you think, doesn’t it? This Libertarian would be all in, so go ahead, make my day!

    .

    * An interesting thought experiment is to contemplate a observation made by astronomers that determined with high certainty that there was gold on some asteroid. (You know it’d be a lot, too!). Once plans were made for some unmanned missions, and the costs estimated, the value of gold here on Earth would accommodate that price, and I wonder if it would get down to a point where the missions would barely be worth doing.

    That’s different from the 16th (?) century taking of all that gold from the Incas and Aztecs and such. Back then, information didn’t flow quite as easily. As far as I know, that was the only time in history in which there was a big enough increase in the REAL MONEY supply to bring down its value as currency.

  19. @A123
    WUHAN-19 virus leading to UBI is the worst case scenario.

    And, there is a good countermeasure. Paying UBI to the unemployed means there are many employable people in the coubtry. Therefore, the U.S. does not need to import more people. The Elite SJW Globalist attempt at UBI, could easily backfire if it gives Trump sufficient cover to end H1B/OPT.
    _____

    WUHAN-19 leading to disengagement from China is the best case scenario.

    Not only is this outcome positive for the U.S. It is already happening. (1)

    a U.S.-based rare-earth materials mining company, MP Materials, was granted a U.S. Department of Defense contract to begin the process of bringing the mining of these elements back to the U.S. and away from China, which had been producing roughly 80% of the world’s supply. These elements are crucial in the development of technological products, notably in high-tech security and defense systems, and the move to bring the supply chain home is a hallmark of a great exodus of business and manufacturing out of mainland China, and not just by the U.S.
     
    PEACE 😷
    _______

    (1) https://townhall.com/tipsheet/sarahlee/2020/04/24/a-great-business-exodus-from-china-n2567594

    Thanks, A123. I never thought Socialism would ramp up this quick, but they have not been wasting this purported “crisis”. I’ll give ’em all credit for that, as evil as it is. Both the Socialists with their putting half the country on the dole, and the other Totalitarians, with their LOCKDOWNS and SHELTER-IN-PLACES and other bullshit, have taken full advantage.

    I never thought I’d get that pissed about this, but when I saw my power bill, with their message about power not being turned off for non-payment, that got me really thinking yesterday. Being a responsible person will no longer pay in this country! I really don’t know what the plan for me and my family will be now.

    If that last paragraph sounds hyperbolic, well, this stuff is really coming to a head now. All these dense-headed Socialists will only learn the lesson when it’s too late. The more that responsible people are screwed over left and right, the fewer responsible people there will be left. How do you come out of that?

    A.E., thank you for the posts on the financial aspect of this Kung Flu Infotainment Panic Fest. This is a MUCH BIGGER deal than the issue of the virus itself.

    • Agree: AaronInMVD
    • Replies: @Curmudgeon
    China! China! China!
    Russia! Russia! Russia!
    Socialism! Socialism! Socialism!

    After you have read this, compare it to the manure spread in the US as Socialism
    https://slife.org/socialism/
    Socialists expect people to work, but understand in some circumstances they need help. Sometimes the help needed will be longer term, depending on the circumstances. Real socialists are opposed to high immigration rates.

    The author of this article makes a big leap for the Chinese American. My son s girlfriend is Chinese (much to my chagrin). She and her parents are also in favour of the restrictive measures being taken, even though they can work from home. The reality is that some cultures have a greater affinity for authoritarian governments. Had real socialist governments been in power, neither the author`s friend nor my son`s girlfriend (and family) would be on this continent.
    , @A123

    I never thought I’d get that pissed about this, but when I saw my power bill, with their message about power not being turned off for non-payment, that got me really thinking yesterday. Being a responsible person will no longer pay in this country! I really don’t know what the plan for me and my family will be now.
     
    This is not as bad as it looks at first glance. In large parts of the South, staying at home means running an A/C unit. The Amount Due has not been forgiven, so the bill must eventually be paid. Waiving late charges and exceedingly high 'penalty interest rates' is not an unreasonable response.

    Compare this to Warren's craven plan for Student Loan amnesty. That is a direct subsidy to those who obtained Grievance degrees from over priced, elitist institutions. Most ethnic, gender, and region based degrees lack academic value. They should be eliminated as they only lead to unemployment.

    PEACE 😷
    , @MBlanc46
    One doesn’t come out of it, AE. A reckoning is coming. I was hoping that it might hold off 12 or 15 years so that I could have departed this life. The consequences of the virus panic might dash my hopes. One quibble with your attribution of this state of affairs to Socialists. I see pols of the Right-wing party and corporate nabobs jumping on this pass out the money train. I’d say that what we have here is actually existing capitalism.
  20. The persistent failure of libertarian/goldbug economics to accurately describe present conditions and make reliable predictions should make more people skeptical.

    They’ve predicted 30 of the last 3 recessions and deflect all critique by blaming the “mixed economy/No True Capitalism” that their libertarian, egalitarian, one-man one-vote political system provides no means to arrest or even address.

  21. Gold serves as a decent currency not because it is mostly useless, but because it can neither be created nor destroyed.

    Ok, let’s assume, for the sake of argument, that a totally static money supply is desirable. Even then, “uselessness” is still a crucial component of currency.

    Let me elaborate: I’m assuming we can all agree that a stable price of money (e.g. little inflation or deflation) is a good thing. That should be our “goal.” To do so we need to limit all sources of potential variability; we need supply and demand to remain constant in relation to each other. With a “useless” currency, we have one supply (how much money exists) and one demand (how many transactions occur per unit of time). With a “useful” currency, we still have one supply, but two demands: it’s demand as a means of exchange, plus its demand for whatever additional use it has.

    Here’s an example: something that’s even harder to create or destroy than gold is land. It is totally possible to use land as a form of currency and has been done historically (property-backed notes were issued by the despicable French Revolutionary government). But it never lasted long, for an obvious reason: the price of land is volatile. A wheat field might be worth a lot, but then a glut of imported wheat arrives from some new colony and suddenly it is worth very little. A run-down Philly rowhome will see its value skyrocket as the neighborhood gentrifies. This volatility is lessened a bit in the aggregation, just as diversified stock portfolios are less volatile than particular stocks, but overall real estate prices still vary widely.

    So “useful” currency introduces an unwanted volatility in the price of money, triggering uncontrollable inflation or deflation totally unrelated to broader economic considerations. A farmer buying shoes from a cobbler in Bordeaux could have to pay twice as much as before because a bunch of North Africans migrants have cratered the price of land in Paris.

    _

    Therefore you want the “intrinsic” value of your currency (outside its exchange value) to be perfectly steady. Technically, it doesn’t have to be valueless: if it has an intrinsic value that it always exactly the same, that would also be fine. But realistically, this never happens, leaving valueless currency as the best option.

    • Replies: @Audacious Epigone
    What is, on balance, both more steady in supply and of less intrinsic value than gold? What we get in the latter with fiat currency we lose and then some in the former.

    Bitcoin tries to be both steady in supply and of no intrinsic value. The glaring problem is that while the number of bitcoins are allegedly fixed, the number of competing crypto currencies are infinite.
  22. @Achmed E. Newman
    Thanks, A123. I never thought Socialism would ramp up this quick, but they have not been wasting this purported "crisis". I'll give 'em all credit for that, as evil as it is. Both the Socialists with their putting half the country on the dole, and the other Totalitarians, with their LOCKDOWNS and SHELTER-IN-PLACES and other bullshit, have taken full advantage.

    I never thought I'd get that pissed about this, but when I saw my power bill, with their message about power not being turned off for non-payment, that got me really thinking yesterday. Being a responsible person will no longer pay in this country! I really don't know what the plan for me and my family will be now.

    If that last paragraph sounds hyperbolic, well, this stuff is really coming to a head now. All these dense-headed Socialists will only learn the lesson when it's too late. The more that responsible people are screwed over left and right, the fewer responsible people there will be left. How do you come out of that?

    A.E., thank you for the posts on the financial aspect of this Kung Flu Infotainment Panic Fest. This is a MUCH BIGGER deal than the issue of the virus itself.

    China! China! China!
    Russia! Russia! Russia!
    Socialism! Socialism! Socialism!

    After you have read this, compare it to the manure spread in the US as Socialism
    https://slife.org/socialism/
    Socialists expect people to work, but understand in some circumstances they need help. Sometimes the help needed will be longer term, depending on the circumstances. Real socialists are opposed to high immigration rates.

    The author of this article makes a big leap for the Chinese American. My son s girlfriend is Chinese (much to my chagrin). She and her parents are also in favour of the restrictive measures being taken, even though they can work from home. The reality is that some cultures have a greater affinity for authoritarian governments. Had real socialist governments been in power, neither the author`s friend nor my son`s girlfriend (and family) would be on this continent.

    • Replies: @Achmed E. Newman
    Nobody against Socialism is screaming with multiple exclamation points about Russia and China. Do you mean the USSR of and Red China of 30 and 40 years ago, respectively, Curmudgeon?

    Socialists expect people to work, but understand in some circumstances they need help. Sometimes the help needed will be longer term, depending on the circumstances.
     
    As do Libertarians. The difference is that Libertarians (along with true Conservatives) know that government handouts are not any real form of charity. That means they come with corruption, no regard for the outcome of said "charity", and no control of the spending of others' involuntary "charity". This is what Socialists either are too dense to get, have no experience in the real world with, or purposefully ignore, to get their plans implemented.

    Real socialists are opposed to high immigration rates.
     
    As are plenty of Libertarians. Just as with Socialists though, lots, if not most, of them in America are just deluded fools, thinking that one can have a Libertarian Society or a half-way-decent (not every likely either way) Socialist system, with the type of people who have been allowed to enter from lands most foreign.

    BTW, I will try to get through the whole of the article you linked to. It's a long one, and I'm sure I'll come up with too many refutations to even remember by the time I'm done. ;-}

    I agree completely with your last paragraph, except for the chagrin part. She may make a good wife compared to lots of feminist American women, but that depends on how long she's been exposed here. Hopefully her parents will have to go back. "Sorry, Trump and all. See you later. We'll send some non-poisonous baby formula for the nephew. Buh-bye."

    .

    PS: Ask your man Bernie about high immigration rates. I think he'll just pretend he didn't hear you.

  23. On the very strong humidity correlation with Corona, I was having a back and forth with Steve on his blog. He seems skeptical based on the single counterexample of Ecuador. To me the Ecuador case looks really fishy because there is no example like it in the tropics.

    He wrote:
    ————————————
    Steve Sailer says: • Website
    April 26, 2020 at 3:49 am GMT

    “In Guayaquil, fatalities during the first two weeks of April were eight times higher than usual, the data indicates — a far greater rise than that of New York City, where fatalities were four times higher in recent weeks.”

    https://www.nytimes.com/2020/04/23/world/americas/ecuador-deaths-coronavirus.html

    ————————————-
    I replied, quoting the NYT article:

    @Steve Sailer

    “In another city hospital, the Teodoro Maldonado Carbo, a doctor who did not want to give his name because he has been asked not to speak to the media, described what he said were scenes out of a horror film.
    There were corpses in wheelchairs, in stretchers and on the floor in the emergency area, he said. The smell was such that the staff refused to enter.”

    Astonishing! That would really be an amazing photo. It would be the most viral picture in the world, really. And everyone has a smartphone.

    “The reek was insufferable,” he said. “The morgue was packed, as were the corridors — they were very long, and filled with corpses. The waiting room was filled with corpses.”

    That is quite the story.

    “Official figures show 128 died on April 15 in Guayas, the province that includes Guayaquil. That’s down from 614 on April 1.”

    So suddenly western media shows up and its all so much better…

    “The wave of deaths is all the more disturbing for being impossible to explain. There is no obvious reason for Ecuador to be devastated far more than other countries. Its population is relatively young, and most people live in rural areas, both factors that should reduce the risk, said Jenny Garcia, a demographer who studies Latin America at the Institut National d’Études Démographiques in France.”

    Yeah, this case does seem to stand all by its lonesome in comparison to the thousands of major cities and large towns across the entire tropical world.

    ““We will never know what the real number is, because there are no tests,” Ms. Viteri said.”

    No tests? The list of diseases that can have breakouts in Ecuador is really really long.

    Also the president is named after the original communist. That seems to relevant. There are a lot of reasons why this would be a useful story, including international aid.

    Steve, are there any other examples like this? It looks really shaky. Brazil had the virus lurking for a long time and has people stacked in filthy crowded favalas, with worse crowding than in New York. It’s fatality rate is meanwhile only 1/50th that of New York State.

    If the amazing benefit of humidity in this pandemic shown across the vast majority of data is to be ignored because of one counterexample, it might be good to take a look at that counterexample.
    This is what most of the other data show:

    https://www.marketwatch.com/story/this-stunning-chart-shows-the-coronavirus-spreading-slowly-in-tropical-countries-2020-03-17

    • Replies: @res
    As I mentioned fairly early in the humidity conversations, the flu has different seasonality in the tropics.
    Influenza Seasonality in the Tropics and Subtropics – When to Vaccinate?
    https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0153003

    So something more than low humidity is a factor there. Perhaps the virus-humidity curve is U shaped?
  24. @Daniel H
    What I would like to see come out of this would be to force manufactures to clearly place a big stamp on the item where a product was produced.

    1) Products sold in the USA already have to indicate country of origin.

    2) To the American consumer, wouldn't make a damn bit of difference. The American has little sense of national solidarity. Every man/woman in this country is out for themselves. Pay a little more so that manufacturing could be done in America? Hell no. Get outta' my way. I want it cheap. We can only achieve industrial production in the USA if it is mandated by law. We must end free trade as national policy. Forcing consumers to pay more must be done through the mandate of law.

    Forcing consumers to pay more must be done through the mandate of law.

    Back in the 90’s the Chinese government bought themselves Most Favored Nation trade status. All we’d have to do is revoke that status.

    Back in 1997, when Democrats defended union workers before they figured out that electing a new people was the path to power, Nancy Pelosi wanted MFN revoked. Here’s the title of the press release.

    Statement of Representative Nancy Pelosi Anouncing Coalition Working To Revoke Most Favored Nation Trade Status for China

    https://pelosi.house.gov/sites/pelosi.house.gov/files/pressarchives/releases/mfn97pr.htm

    • Thanks: Audacious Epigone
  25. I think Trump will win. If I understand correctly, his signature (photocopied) is on unemployment checks. (Someone correct me if I’m wrong).

    Whose signature will be on UBI? Someone not paying it, no doubt.

    • Replies: @Neuday

    Whose signature will be on UBI? Someone not paying it, no doubt.
     
    It should be the names of Richard Cloward and Frances Fox Piven.
    , @Audacious Epigone
    His signature is on a physical letter that is sent out via snail mail at around the time the electronic transfers were made.
  26. @Achmed E. Newman
    Thanks, A123. I never thought Socialism would ramp up this quick, but they have not been wasting this purported "crisis". I'll give 'em all credit for that, as evil as it is. Both the Socialists with their putting half the country on the dole, and the other Totalitarians, with their LOCKDOWNS and SHELTER-IN-PLACES and other bullshit, have taken full advantage.

    I never thought I'd get that pissed about this, but when I saw my power bill, with their message about power not being turned off for non-payment, that got me really thinking yesterday. Being a responsible person will no longer pay in this country! I really don't know what the plan for me and my family will be now.

    If that last paragraph sounds hyperbolic, well, this stuff is really coming to a head now. All these dense-headed Socialists will only learn the lesson when it's too late. The more that responsible people are screwed over left and right, the fewer responsible people there will be left. How do you come out of that?

    A.E., thank you for the posts on the financial aspect of this Kung Flu Infotainment Panic Fest. This is a MUCH BIGGER deal than the issue of the virus itself.

    I never thought I’d get that pissed about this, but when I saw my power bill, with their message about power not being turned off for non-payment, that got me really thinking yesterday. Being a responsible person will no longer pay in this country! I really don’t know what the plan for me and my family will be now.

    This is not as bad as it looks at first glance. In large parts of the South, staying at home means running an A/C unit. The Amount Due has not been forgiven, so the bill must eventually be paid. Waiving late charges and exceedingly high ‘penalty interest rates’ is not an unreasonable response.

    Compare this to Warren’s craven plan for Student Loan amnesty. That is a direct subsidy to those who obtained Grievance degrees from over priced, elitist institutions. Most ethnic, gender, and region based degrees lack academic value. They should be eliminated as they only lead to unemployment.

    PEACE 😷

    • Replies: @Achmed E. Newman
    No, I think it MAY be as bad as I can imagine, A123. I give it 50/50. That's the way things go when a country turns Socialist. It's not that I begrudge people a little break on late fees, etc. No, what I see is that people are now incentivized to let the bill go for many months. Then, when people all over the area, owe $500 to $1,500 dollars, the company will bail them out, using a portion of bail-out money being paid by us taxpayers.

    I just wrote my post on that - see "Power Bills and Moral Hazards".

    I agree on the even more egregious moral hazard of school loan forgiveness, caused by the initial moral hazard of letting the Feral Gov't guarantee bank loans to students. However, Chief Warren or no Chief Warren, I think it's coming. What CAN'T be paid WON'T be paid.

    How will it feel to be the sucker who pays all his bills in future Socialist bail-out-land America?

  27. @The Alarmist

    Gold serves as a decent currency not because it is mostly useless, but because it can neither be created nor destroyed.
     
    Not entirely true: The world was flooded with gold in the 1850s, and that would have led to serious inflation if that had not been severely offset by Industrial Revolution increases in productivity that led to the so-called Great Deflation from 1870 to 1890.

    Here's an interesting contemporary take on gold.

    https://archive.org/stream/aseriousfallinv00jevogoog#page/n10/mode/2up

    More spectacularly with the Spanish New World discoveries. In the 1500s gold plummeted so hard Spain basically went bankrupt while simultaneously having more gold than anyone thought imaginable even a few decades prior

  28. There are 3 layers of sound money, in order of least argument surface, most primitive and most global:

    1) Rarity money.
    2) Land rent money.
    3) Property money.

    Rarity money has been around at least since Cro Magnon and will always be with us. Gold is just one example but Bitcoin is another. It is the only money that is pure network effect, i.e. “everyone agrees” money.

    Land rent money appears as the foundation of civilization due to the necessity of collective defense of agricultural land. It is the first form of “fiat” in that a military power must “back” it. Properly utilized, it scales to provide the foundation of a Pax — peaceful inter-jurisdictional dispute resolution over land.

    Property money appears when improvements become as important to defend as agricultural land. It applies primarily for a jurisdiction’s law enforcement. It is the final form of sound fiat.

    At this stage, the wealthy are tempted to replace the land and property tax base of the respective sound monetary systems, with taxes on economic activity. They can get away with this because of the network effect arising from the sound fiat money can be enforced without its sound backing in property (or more fundamentally, territorial control). The backing becomes just military force to prevent anyone from instituting sound currencies.

  29. @Realist

    Forcing consumers to pay more must be done through the mandate of law.
     
    Sounds like a plan everyone would love.

    Sounds like a plan everyone would love.

    To return manufacturing to America, to create better quality jobs, to lessen income inequality, it would be worth it that the consumer pays a little more.

    • Replies: @Realist

    To return manufacturing to America, to create better quality jobs, to lessen income inequality, it would be worth it that the consumer pays a little more.
     
    Yeah, I understand your position....now let's hear from the other 320 million.
    , @dfordoom

    To return manufacturing to America, to create better quality jobs, to lessen income inequality, it would be worth it that the consumer pays a little more.
     
    The consumer might not agree.

    What surprises me these days is to see so many people on the Right embracing statist authoritarian solutions. I see right-wingers arguing that if consumers don't want to pay higher prices we'll just get the government to force them to do so. In fact the far right seems to be getting more and more authoritarian in outlook.

    It's also amusing to see people on the Right embracing the idea of central economic planning. Maybe we need a Five Year Plan to increase manufacturing. Lenin and Stalin, wherever they might be now, must be having a good old chortle about this. Or maybe we need a Great Leap Forward.
  30. @Realist

    No one would ever go back to a gold backed money supply.
     
    The reason Nixon ended of the gold standard in America on August 15, 1971 was to allow the unhampered printing of fiat currency. Intelligent people would gladly go to a gold backed money supply.

    If fiat currency is so wonderful why not print 100 million dollars for everybody?

    If fiat currency is so wonderful why not print 100 million dollars for everybody?

    It seems that the Fed would eagerly print 100 million per capita. It’s just that such money will be distributed only to their favorites, the Wall Street banks.

    • Agree: Realist, Cloudbuster
  31. @Kratoklastes
    Define 'useless' and 'junk'.

    To take an example: in my taxonomy, anyone who owns a 'hard-copy' book, owns junk. That's true even if it's a hard-cover, hard-copy of "Common Sense" or "Human Action" or "The Road to Serfdom" or "Ukridge" (yes, even Ukridge, I'll trouble you!) - all of which I own in both physical and electronic form.

    Those of us who take the big, broad, flexible outlook know that it makes much more sense to have a searchable repository of five thousand e-books rather than a whole wall wasted on a limited, non-searchable (fixed font... primitives) paper versions.


    Is my Oculus Go "junk"? Not to me (and 'twas my money was spent on it).


    As to yon Chinese: if the US was stupid enough to start a war with the Chinese, the economic carnage would be beyond human comprehension. The US relies critically on the Chinese to absorb new US government debt: without Chinese accumulation of US Treasuries, US mortgage rates would be in the double-digits, and more than half the US corporate bonds would default.

    E-books are great–until the censors start deleting parts or all of the electronic books deemed too sensitive for human consumption.

    Most of my print library would be censored for a thousand reasons in a future dystopia–racist, sexist, homophobe, anti-government, etc etc etc–and most of it is science fiction.

    • Replies: @dfordoom

    E-books are great–until the censors start deleting parts or all of the electronic books deemed too sensitive for human consumption.

    Most of my print library would be censored for a thousand reasons in a future dystopia–racist, sexist, homophobe, anti-government, etc etc etc–and most of it is science fiction.
     
    Yep. E-books were the worst idea in history. Incredibly Orwellian.

    But people are more and more willing to embrace authoritarianism and social control. People who buy e-books seem to be quite happy to be told what they can and can't read.
  32. @Daniel H
    Sounds like a plan everyone would love.

    To return manufacturing to America, to create better quality jobs, to lessen income inequality, it would be worth it that the consumer pays a little more.

    To return manufacturing to America, to create better quality jobs, to lessen income inequality, it would be worth it that the consumer pays a little more.

    Yeah, I understand your position….now let’s hear from the other 320 million.

  33. I’m in favor of UBI but if any internet revolutionaries (left or right) think they’re going to let you take the money and use it to resist the system, lmao.

  34. @Realist

    No one would ever go back to a gold backed money supply.
     
    The reason Nixon ended of the gold standard in America on August 15, 1971 was to allow the unhampered printing of fiat currency. Intelligent people would gladly go to a gold backed money supply.

    If fiat currency is so wonderful why not print 100 million dollars for everybody?

    Wrong. The U.S. fiscal policy had almost nothing to do with gold. The gold standard of that time was simply an agreement that other countries, which fixed the value of their currency to the U.S. dollar, could exchange their dollar holdings for gold at a fixed price. The U.S. already had the ability to print as much fiat currency as it wanted. Not that that matters much, monetary policy without fiscal support is toothless.

    If fiat currency is so wonderful why not print 100 million dollars for everybody?

    If fiat currency is so terrible why haven’t incompetent governments already printed 100 million dollars and instituted $100 million handouts for everybody?

    Inflation is one answer to your question. Another is that there is no political will or reason to hand out 100 million dollars for everybody. If everyone has 100 million dollars, 100 million dollars is worthless. You should be able to answer this question yourself however.

    • Replies: @Cloudbuster
    When autism collides with a rhetorical question.
    , @Cloudbuster
    The gold standard of that time was simply an agreement that other countries, which fixed the value of their currency to the U.S. dollar, could exchange their dollar holdings for gold at a fixed price. The U.S. already had the ability to print as much fiat currency as it wanted.

    You understand the import of that statement explains exactly why the US government couldn't print as much money as it wanted: the requirement that it be able to exchange dollars for gold at a fixed price. The government can always print paper money in a certain excess of gold holdings, but if people realize that the government is abusing this power, you get bank runs as people ditch your currency.

    Inflation is one answer to your question. Another is that there is no political will or reason to hand out 100 million dollars for everybody. If everyone has 100 million dollars, 100 million dollars is worthless. Once upon

    Inflation is the name of the game. The government loves a certain amount of inflation. The only reason it doesn't love a ton of inflation is that it makes the scam too obvious. We've been running an inflationary economy since the Great Depression. It functions as a non-legislated wealth tax. Historically speaking $100 million dollars is now nearly worthless compared to what it could buy in 1900 (about $3 billion in today's dollars). The federal government just printed several trillion dollars of fiat money, most of which went to banks and a pittance of which went to individuals and small businesses as a PR stunt.

    They've been doing that repeatedly, in smaller amounts for a couple decades now. But typically most of it isn't allowed in general circulation, which is why the velocity of the dollar has been plummeting for decades -- most of the dollars don't actually circulate, they just sit there as debt instruments. That's why inflation hasn't risen yet.

    They're playing a dangerous game. It's a huge house of cards. I couldn't say how long it can last, but it definitely isn't healthy. Every year the government outspends its revenues by 2-3x. There is simply no way to generate enough revenue to make a dent in that -- you might as well stop collecting revenue completely for all the good it does.

    There is no strategy to do anything about this except trying to slowly bleed the debt away through inflation -- they would really love to have them some more inflation, but the debt has become so expensive that even small amounts of additional inflation can be catastrophic, so they're slowly backing themselves into a corner.

    That's what fiat money does.
    , @Realist
    Cloudbuster' comment # 47 is spot on...no need for me to reply.
  35. @Kratoklastes
    Define 'useless' and 'junk'.

    To take an example: in my taxonomy, anyone who owns a 'hard-copy' book, owns junk. That's true even if it's a hard-cover, hard-copy of "Common Sense" or "Human Action" or "The Road to Serfdom" or "Ukridge" (yes, even Ukridge, I'll trouble you!) - all of which I own in both physical and electronic form.

    Those of us who take the big, broad, flexible outlook know that it makes much more sense to have a searchable repository of five thousand e-books rather than a whole wall wasted on a limited, non-searchable (fixed font... primitives) paper versions.


    Is my Oculus Go "junk"? Not to me (and 'twas my money was spent on it).


    As to yon Chinese: if the US was stupid enough to start a war with the Chinese, the economic carnage would be beyond human comprehension. The US relies critically on the Chinese to absorb new US government debt: without Chinese accumulation of US Treasuries, US mortgage rates would be in the double-digits, and more than half the US corporate bonds would default.

    Back when my grandfather bought his house, you had to put 50% down.

    But then the government stepped in and subsidized home loans. The buying of your home, no doubt, was subsidized by the US government. Unless you got $100,000 or 2 lying around to cough up with money left over to eat with. (Maybe you’re rich and do got it, I don’t know. But don’t tell me you are, because I won’t believe you.)

    Maybe we should go back to 50%. It would concentrate the minds of these libertarian shoot-their-own-selves-in-the-footers quite nicely.

  36. @advancedatheist
    Libertarians who advocate both the gold standard and the general cornucopianism of natural resources apparently don't see that these ideas make contradictory assumptions about Element 79 in the Periodic Table. What if some combination of technological breakthroughs turned gold into a throwaway commodity, like what has happened to aluminum over the last 200 years?

    Also gold depends on political construction to have "value." If our government refused to recognize gold as a form of property, and it didn't arrest and prosecute people who take anything made of gold without the original possessor's consent, then libertarians would see pretty quickly what their "sound money" amounts to.

    The main appeal of gold to libertarians is that gold as currency is deflationary. Deflation favors creditors over debtors and libertarian economics is just an ideological defense of the creditor class.

    • Agree: Jedi Night, utu
    • Replies: @Mark G.

    The main appeal of gold to libertarians is that gold as currency is deflationary. Deflation favors creditors over debtors and libertarian economics is just an ideological defense of the creditor class.
     
    Inflation discourages saving. Jobs come from business investment and business investment comes from savings so discouraging saving causes future job losses.

    Inflation raises domestic wages and makes American workers less competitive with foreign workers by raising the cost of American sold goods. This leads to trade deficits as consumers buy more foreign goods. Since the last link with gold was severed in 1970 inflation and trade deficits have steadily increased. If deflation was really bad and inflation was really good for the average American then the last fifty years of inflation should have improved things for them. Instead they have had stagnating wages as their former well paid jobs have been eliminated due to inflation and replaced by other lower paying jobs.

    It's true that inflation means lower interest loans. You can either have lots of good jobs or low interest loans. You can't have both. If people had good paying jobs they wouldn't need to borrow as much money so you want to focus on job creation and not follow job destroying inflationary policies.
    , @Audacious Epigone
    The big investment banks are the ultimate creditors. They love the current system and loathe the idea of sound money of any kind. Fiat currency is another example of the top (creditors) and the bottom (debtors) against the middle (savers).
  37. @Curmudgeon
    China! China! China!
    Russia! Russia! Russia!
    Socialism! Socialism! Socialism!

    After you have read this, compare it to the manure spread in the US as Socialism
    https://slife.org/socialism/
    Socialists expect people to work, but understand in some circumstances they need help. Sometimes the help needed will be longer term, depending on the circumstances. Real socialists are opposed to high immigration rates.

    The author of this article makes a big leap for the Chinese American. My son s girlfriend is Chinese (much to my chagrin). She and her parents are also in favour of the restrictive measures being taken, even though they can work from home. The reality is that some cultures have a greater affinity for authoritarian governments. Had real socialist governments been in power, neither the author`s friend nor my son`s girlfriend (and family) would be on this continent.

    Nobody against Socialism is screaming with multiple exclamation points about Russia and China. Do you mean the USSR of and Red China of 30 and 40 years ago, respectively, Curmudgeon?

    Socialists expect people to work, but understand in some circumstances they need help. Sometimes the help needed will be longer term, depending on the circumstances.

    As do Libertarians. The difference is that Libertarians (along with true Conservatives) know that government handouts are not any real form of charity. That means they come with corruption, no regard for the outcome of said “charity”, and no control of the spending of others’ involuntary “charity”. This is what Socialists either are too dense to get, have no experience in the real world with, or purposefully ignore, to get their plans implemented.

    Real socialists are opposed to high immigration rates.

    As are plenty of Libertarians. Just as with Socialists though, lots, if not most, of them in America are just deluded fools, thinking that one can have a Libertarian Society or a half-way-decent (not every likely either way) Socialist system, with the type of people who have been allowed to enter from lands most foreign.

    BTW, I will try to get through the whole of the article you linked to. It’s a long one, and I’m sure I’ll come up with too many refutations to even remember by the time I’m done. ;-}

    I agree completely with your last paragraph, except for the chagrin part. She may make a good wife compared to lots of feminist American women, but that depends on how long she’s been exposed here. Hopefully her parents will have to go back. “Sorry, Trump and all. See you later. We’ll send some non-poisonous baby formula for the nephew. Buh-bye.”

    .

    PS: Ask your man Bernie about high immigration rates. I think he’ll just pretend he didn’t hear you.

    • Replies: @Curmudgeon
    The problem I see with Libertarians and Conservatives is that they pretend that there is an edict somewhere that says everything has to be owned privately. They also conflate ownership with management.
    I've seen plenty of local businesses, that have been around for generations, go under because the family members taking over either aren't prepared to do what (great) grampa did to make the company a success, or that they want to alter the business model that was successful. In short, bad management.
    I'm not going to pretend that governments are free from corruption, but it is naive to think corporations and small businesses are not, or cannot be.
    If people pay into something through taxation, and at sometime in their life need to collect on what they've paid into, it's not a handout. Unemployment benefits are an insurance scheme, not a handout. Welfare may be a handout, but towns and cities over 200 years ago budgeted for help for the destitute, it's nothing new.
    As for libertarians being opposed to immigration, they are as scarce as rocking horse shit. Immigration has always been used to suppress wages and working conditions. What puzzles me is why libertarians and conservatives think its perfectly okay for business interests to create business groups to further their goals, but are adamantly opposed to working people doing the same.
    Bernie ain't my man. He's a fraud and always has been.
  38. Gold is also a fiat currency. The industrial demand for gold does nothing to justify even a fraction of its price.

    Not a goldbug here, but industrial demand has literally nothing to do with the definition of fiat currency.

    The Austrian and MMT schools both have their merits, but normies seem to have kind of an anti-wisdom when it comes to currency.

  39. @A123

    I never thought I’d get that pissed about this, but when I saw my power bill, with their message about power not being turned off for non-payment, that got me really thinking yesterday. Being a responsible person will no longer pay in this country! I really don’t know what the plan for me and my family will be now.
     
    This is not as bad as it looks at first glance. In large parts of the South, staying at home means running an A/C unit. The Amount Due has not been forgiven, so the bill must eventually be paid. Waiving late charges and exceedingly high 'penalty interest rates' is not an unreasonable response.

    Compare this to Warren's craven plan for Student Loan amnesty. That is a direct subsidy to those who obtained Grievance degrees from over priced, elitist institutions. Most ethnic, gender, and region based degrees lack academic value. They should be eliminated as they only lead to unemployment.

    PEACE 😷

    No, I think it MAY be as bad as I can imagine, A123. I give it 50/50. That’s the way things go when a country turns Socialist. It’s not that I begrudge people a little break on late fees, etc. No, what I see is that people are now incentivized to let the bill go for many months. Then, when people all over the area, owe $500 to $1,500 dollars, the company will bail them out, using a portion of bail-out money being paid by us taxpayers.

    I just wrote my post on that – see “Power Bills and Moral Hazards”.

    I agree on the even more egregious moral hazard of school loan forgiveness, caused by the initial moral hazard of letting the Feral Gov’t guarantee bank loans to students. However, Chief Warren or no Chief Warren, I think it’s coming. What CAN’T be paid WON’T be paid.

    How will it feel to be the sucker who pays all his bills in future Socialist bail-out-land America?

    • Replies: @A123

    No, I think it MAY be as bad as I can imagine, A123. I give it 50/50. That’s the way things go when a country turns Socialist. It’s not that I begrudge people a little break on late fees, etc. No, what I see is that people are now incentivized to let the bill go for many months. Then, when people all over the area, owe $500 to $1,500 dollars, the company will bail them out, using a portion of bail-out money being paid by us taxpayers.
     
    While not impossible, this sort of slow bleed problem does not seem like the biggest risk.

    The utility company is not going to have *Disconnect Day* where everyone who is behind is hit simultaneously. They will have a rolling program to cutoff offenders in a gradual way. If the media latches onto a specific family and tries to use them as the "cause", that family will likely get a bail out. However, the slow grinding process of one by one collection will continue.

    The big dollar amounts are in things like Student Loans, Mortgages, Auto Loans, and Credit Cards. Those are where the Moral Hazard risks lie.

    PEACE 😷
  40. @Jedi Night
    AE, I'm afraid your understanding of money is limited. Money does not require a perceived premium that exceeds its utility. In fact quite the opposite. Something can become money when it can be exchanged for other trade goods cheaply, the cheaper the better. Ideally money has zero value in itself.

    Real bills and checks are examples of this. Someone with a supply of something issues a note to take possession of it at a future date. Could be trade goods sitting on a ship at dock, could be the grain in a silo, or even a potential crop in the future. Could be tomorrow, next week, or months later. That bill circulates and is traded as a substitute of future value.

    That's right, the origin of paper money. Not even fiat sovereign money. It's real. It works fine.

    You tout gold because it can't be created but that is its huge flaw. Its supply cannot be increased to meet the demands of expanding trade. The lack of money supply constantly restricts trade. Worst of all, it empowers money holders to be a parasite class on the productive economy, empowered by the usury necessary to get money into supply.

    No one would ever go back to a gold backed money supply. It's like trying to sell a return to horses instead of cars, a huge step back wards. It's nonsensical.

    You aren't on the vanguard of monetary theory here. You are simply an intellectual stooge of a reactionary money power. Educate yourself. It's worth it. Free your mind. The truth shall set you free.

    You tout gold because it can’t be created but that is its huge flaw. Its supply cannot be increased to meet the demands of expanding trade.

    If anyone can create money, that money has no value.  For anything, including as a medium of exchange.  If I could conjure a million dollars out of thin air with no effort, I could buy cars, buildings, airplanes and even yachts that took great effort to make… at least until the owners got wise and refused to take dollars in exchange for actual goods.

    To be worthwhile as money, it must be difficult or impossible to counterfeit.  That is the weakness of all fiat currencies, and why all of them collapse.  After the dollar is gone, Bitcoin will still be around.

    • Replies: @Audacious Epigone
    What's your response to objection that while a finite number of Bitcoin exist, an infinite number of cryptocurrencies do? How does Bitcoin ensure it is digital gold and the rest are digital pyrite?

    I'm not trying to be adversarial here--I'm genuinely curious. That concern is the one that has kept me from making the leap, much as I'd love for Bitcoin to succeed (not just in making the early adopters rich, but in actually competing with fiat currencies).

  41. @dfordoom

    In my own view, the US already consumes far too much useless junk.
     
    There's an edge of Puritanism to that. It's a bit moralistic. And there's also a hint of telling people what they should and should not buy. One man's useless junk is another man's vital necessity. Personally I'd prefer to be free to decide to buy whatever I want as long as I can afford it. I'm sure most of the things I buy would be regarded as useless junk by most people but I don't care I'm gonna buy 'em anyway.

    Asceticism is fine if it's freely chosen. Most people aren't going to choose it. They're going to resent anyone who tries to impose it on them. Talk to political leaders who tried to impose austerity programs on their populations. They're now ex-political leaders.

    Damn, it's so embarrassing to me recently finding myself making libertarian arguments all the time.

    Damn, it’s so embarrassing to me recently finding myself making libertarian arguments all the time.

    There’s nothing embarrassing about seeing the light, DforDoom.

  42. anonymous[411] • Disclaimer says:

    UBI is still far too radical but Medicare for All within reach. I’m all for M4A and anything else that will help bring back the mass middle class society.

  43. @Achmed E. Newman
    No, I think it MAY be as bad as I can imagine, A123. I give it 50/50. That's the way things go when a country turns Socialist. It's not that I begrudge people a little break on late fees, etc. No, what I see is that people are now incentivized to let the bill go for many months. Then, when people all over the area, owe $500 to $1,500 dollars, the company will bail them out, using a portion of bail-out money being paid by us taxpayers.

    I just wrote my post on that - see "Power Bills and Moral Hazards".

    I agree on the even more egregious moral hazard of school loan forgiveness, caused by the initial moral hazard of letting the Feral Gov't guarantee bank loans to students. However, Chief Warren or no Chief Warren, I think it's coming. What CAN'T be paid WON'T be paid.

    How will it feel to be the sucker who pays all his bills in future Socialist bail-out-land America?

    No, I think it MAY be as bad as I can imagine, A123. I give it 50/50. That’s the way things go when a country turns Socialist. It’s not that I begrudge people a little break on late fees, etc. No, what I see is that people are now incentivized to let the bill go for many months. Then, when people all over the area, owe $500 to $1,500 dollars, the company will bail them out, using a portion of bail-out money being paid by us taxpayers.

    While not impossible, this sort of slow bleed problem does not seem like the biggest risk.

    The utility company is not going to have *Disconnect Day* where everyone who is behind is hit simultaneously. They will have a rolling program to cutoff offenders in a gradual way. If the media latches onto a specific family and tries to use them as the “cause”, that family will likely get a bail out. However, the slow grinding process of one by one collection will continue.

    The big dollar amounts are in things like Student Loans, Mortgages, Auto Loans, and Credit Cards. Those are where the Moral Hazard risks lie.

    PEACE 😷

    • Replies: @Achmed E. Newman
    A123, no, they will not have "Disconnect Day". What I can foresee is that a huge chunk of their customers will be behind by a huge amount (relatively to their normal bill) that they can't or won't pay. The power company will have a great excuse (maybe already has tried it) to get on that gravy train - there are plenty of hundreds of millions within 2 or more trillions to go around, folks! "The formerly LOCKED-DOWN folks can't pay - you must help us help them, Uncle Sugar! We'll keep just a little bit of it too, for all the admin. work, of course ..."

    As usual, the responsible ones in the middle class, I mean what's left of it, will get screwed. I'm not saying this is for sure what will happen, but this kind of thing will be increasingly likely, as we enter hardcore Socialism or whatever one might like to call it.
  44. Once again, some of us get milked like cows.

    My wife and I don’t qualify for this pittance that is being distributed, due to the numbers on our tax returns being just a little bit too high. Now, this free Monopoly Money is being helicoptered down from the thin air, inflated with debt that will be paid by taxpayers — by my wife and me! — forever…

    UBI is another term for OPM = Other People’s Money.

    Thank you very much, assholes.

    • Agree: Achmed E. Newman
    • Replies: @Twinkie

    My wife and I don’t qualify for this pittance that is being distributed, due to the numbers on our tax returns being just a little bit too high.
     
    Forget a little bit too high, my wife and I get pretty much no deduction on our tax return. Everything (child credit, medical expenses, QBI, etc.) is phased out, because we earn too much. I try to be grateful for the financial condition we are in, but when I go over my return and see all the things for which we do not qualify, I do get a bit peeved.
    , @Cloudbuster
    Well, this is a war of the top and the bottom against the middle.

    The poor get their social welfare gimmes, the rich get their tax structure gimmes and typical middle class people with nice salaries, a mortgage and a couple cars don't get sh*t. Congratulations on being the sucker at the poker table.
  45. @EldnahYm
    Wrong. The U.S. fiscal policy had almost nothing to do with gold. The gold standard of that time was simply an agreement that other countries, which fixed the value of their currency to the U.S. dollar, could exchange their dollar holdings for gold at a fixed price. The U.S. already had the ability to print as much fiat currency as it wanted. Not that that matters much, monetary policy without fiscal support is toothless.

    If fiat currency is so wonderful why not print 100 million dollars for everybody?
     
    If fiat currency is so terrible why haven't incompetent governments already printed 100 million dollars and instituted $100 million handouts for everybody?

    Inflation is one answer to your question. Another is that there is no political will or reason to hand out 100 million dollars for everybody. If everyone has 100 million dollars, 100 million dollars is worthless. You should be able to answer this question yourself however.

    When autism collides with a rhetorical question.

  46. @Buzz Mohawk
    Once again, some of us get milked like cows.

    My wife and I don't qualify for this pittance that is being distributed, due to the numbers on our tax returns being just a little bit too high. Now, this free Monopoly Money is being helicoptered down from the thin air, inflated with debt that will be paid by taxpayers -- by my wife and me! -- forever...

    UBI is another term for OPM = Other People's Money.

    Thank you very much, assholes.

    My wife and I don’t qualify for this pittance that is being distributed, due to the numbers on our tax returns being just a little bit too high.

    Forget a little bit too high, my wife and I get pretty much no deduction on our tax return. Everything (child credit, medical expenses, QBI, etc.) is phased out, because we earn too much. I try to be grateful for the financial condition we are in, but when I go over my return and see all the things for which we do not qualify, I do get a bit peeved.

    • Replies: @Audacious Epigone
    That you still engage in the charitable acts you do is very laudable. It'd be easy to say "I've already paid way more than my fair share, I'm done", I'd think.
  47. @EldnahYm
    Wrong. The U.S. fiscal policy had almost nothing to do with gold. The gold standard of that time was simply an agreement that other countries, which fixed the value of their currency to the U.S. dollar, could exchange their dollar holdings for gold at a fixed price. The U.S. already had the ability to print as much fiat currency as it wanted. Not that that matters much, monetary policy without fiscal support is toothless.

    If fiat currency is so wonderful why not print 100 million dollars for everybody?
     
    If fiat currency is so terrible why haven't incompetent governments already printed 100 million dollars and instituted $100 million handouts for everybody?

    Inflation is one answer to your question. Another is that there is no political will or reason to hand out 100 million dollars for everybody. If everyone has 100 million dollars, 100 million dollars is worthless. You should be able to answer this question yourself however.

    The gold standard of that time was simply an agreement that other countries, which fixed the value of their currency to the U.S. dollar, could exchange their dollar holdings for gold at a fixed price. The U.S. already had the ability to print as much fiat currency as it wanted.

    You understand the import of that statement explains exactly why the US government couldn’t print as much money as it wanted: the requirement that it be able to exchange dollars for gold at a fixed price. The government can always print paper money in a certain excess of gold holdings, but if people realize that the government is abusing this power, you get bank runs as people ditch your currency.

    Inflation is one answer to your question. Another is that there is no political will or reason to hand out 100 million dollars for everybody. If everyone has 100 million dollars, 100 million dollars is worthless. Once upon

    Inflation is the name of the game. The government loves a certain amount of inflation. The only reason it doesn’t love a ton of inflation is that it makes the scam too obvious. We’ve been running an inflationary economy since the Great Depression. It functions as a non-legislated wealth tax. Historically speaking $100 million dollars is now nearly worthless compared to what it could buy in 1900 (about $3 billion in today’s dollars). The federal government just printed several trillion dollars of fiat money, most of which went to banks and a pittance of which went to individuals and small businesses as a PR stunt.

    They’ve been doing that repeatedly, in smaller amounts for a couple decades now. But typically most of it isn’t allowed in general circulation, which is why the velocity of the dollar has been plummeting for decades — most of the dollars don’t actually circulate, they just sit there as debt instruments. That’s why inflation hasn’t risen yet.

    They’re playing a dangerous game. It’s a huge house of cards. I couldn’t say how long it can last, but it definitely isn’t healthy. Every year the government outspends its revenues by 2-3x. There is simply no way to generate enough revenue to make a dent in that — you might as well stop collecting revenue completely for all the good it does.

    There is no strategy to do anything about this except trying to slowly bleed the debt away through inflation — they would really love to have them some more inflation, but the debt has become so expensive that even small amounts of additional inflation can be catastrophic, so they’re slowly backing themselves into a corner.

    That’s what fiat money does.

    • Agree: Realist, Mr. Rational
    • Replies: @Audacious Epigone
    Spending is going to outstrip revenues by a lot more than 2x-3x this year. And next year, and the year after that. As for slowly backing itself into a corner, it's already there. It has been since at least late 2018, when a gentle move towards upping rates and unwinding the balance sheet crashed the stock market.
    , @EldnahYm

    You understand the import of that statement explains exactly why the US government couldn’t print as much money as it wanted: the requirement that it be able to exchange dollars for gold at a fixed price. The government can always print paper money in a certain excess of gold holdings, but if people realize that the government is abusing this power, you get bank runs as people ditch your currency.
     
    It had to exchange gold only for foreign dollar holdings. The U.S. fiscal policy was not impacted by the gold standard. Audacious Epigone's comment section is apparently too dim to understand this, so I'll spell it out: The U.S. as the world reserve currency is the cause of the draining of gold reserves, not U.S. domestic policy. Or to put it another way, the foreign demand for U.S. dollars was the cause of a draining of gold reserves, not the amount "printed."

    Inflation is the name of the game. The government loves a certain amount of inflation. The only reason it doesn’t love a ton of inflation is that it makes the scam too obvious. We’ve been running an inflationary economy since the Great Depression. It functions as a non-legislated wealth tax. Historically speaking $100 million dollars is now nearly worthless compared to what it could buy in 1900 (about $3 billion in today’s dollars). The federal government just printed several trillion dollars of fiat money, most of which went to banks and a pittance of which went to individuals and small businesses as a PR stunt.

    They’ve been doing that repeatedly, in smaller amounts for a couple decades now. But typically most of it isn’t allowed in general circulation, which is why the velocity of the dollar has been plummeting for decades — most of the dollars don’t actually circulate, they just sit there as debt instruments. That’s why inflation hasn’t risen yet.

    They’re playing a dangerous game. It’s a huge house of cards. I couldn’t say how long it can last, but it definitely isn’t healthy. Every year the government outspends its revenues by 2-3x. There is simply no way to generate enough revenue to make a dent in that — you might as well stop collecting revenue completely for all the good it does.

    There is no strategy to do anything about this except trying to slowly bleed the debt away through inflation — they would really love to have them some more inflation, but the debt has become so expensive that even small amounts of additional inflation can be catastrophic, so they’re slowly backing themselves into a corner.

    That’s what fiat money does.
     
    That's an utterly worthless rant that has nothing to do with anything. However, I'll at least you credit for managing to notice that most of the theoretical new currency in circulation is not actually so. This observation has so far been beyond many of the commenters here. Everything else you said is completely wrong unfortunately. If you had cut out "yet" from the following sentence: "That’s why inflation hasn’t risen yet." you could have at least gotten one thing right.

    What can't fiat money do? It's amusing to read people list a bunch of things they consider bad, then attribute them to "fiat money," and not even bother to check if there are historical examples of the exactly the things they describe which existed during periods of acceptance of the gold standard.
  48. @Buzz Mohawk
    Once again, some of us get milked like cows.

    My wife and I don't qualify for this pittance that is being distributed, due to the numbers on our tax returns being just a little bit too high. Now, this free Monopoly Money is being helicoptered down from the thin air, inflated with debt that will be paid by taxpayers -- by my wife and me! -- forever...

    UBI is another term for OPM = Other People's Money.

    Thank you very much, assholes.

    Well, this is a war of the top and the bottom against the middle.

    The poor get their social welfare gimmes, the rich get their tax structure gimmes and typical middle class people with nice salaries, a mortgage and a couple cars don’t get sh*t. Congratulations on being the sucker at the poker table.

  49. “Not any different than the dollar except that it is harder to create more gold than dollars.”

    that being the entire point. avoiding all the ‘new’ issues of paper fiat inflation, fraud, and a money parasite class. i’m moderately onboard with metal as money. it made more sense, was more honest, and it’s even in the Constitution. but i have no illusions about returning to metal for money.

    for me i guess the main issue is that metal cannot be moved all that fast, but digital money can move 12,000 miles instantly, the longest distance on the planet. that’s a huge advantage. and i’m not talking about cryptocurrency, but digital ledgers representing paper bills that don’t exist.

    in many ways digital money is as big of an advance over paper fiat as paper fiat is over metal, for purposes of efficiency and increasing the ease of economic activity. today, money can teleport. even after the advent of the telegraph 150 years ago and the ability to ‘wire’ money, the money still did not really teleport for practical purposes. physical money had to be at both ends of the telegraph.

    perhaps it would be possible to return to metal, with digital ledger claims on metal held in vaults used as the method to change ownership. but that’s still just a claim on the metal. physical possession is 90% of the game, as they say. banks would be forced to return to holding tons of metal, which reintroduces the old security issues. eliminating the presence of physical money, as they’re doing in Scandinavia, eliminates all the old security issues with money, which is on net positive versus the new, smaller issues of digital security.

    • Replies: @Elmer's Washable School Glue

    “Not any different than the dollar except that it is harder to create more gold than dollars.”

    that being the entire point. avoiding all the ‘new’ issues of paper fiat inflation, fraud, and a money parasite class. i’m moderately onboard with metal as money. it made more sense, was more honest, and it’s even in the Constitution.
     

    AE:

    Gold serves as a decent currency not because it is mostly useless, but because it can neither be created nor destroyed.
     
    Gold mines exist.

    You're both basing your argument on the idea that the supply of gold will not grow faster than the demand. And to your credit you're probably correct, although as other commentors have pointed out, there have been periods where big increases in gold production have caused catastrophic inflationary effects in gold-backed systems.

    Of course, there's a flip side: if demand grows faster than supply we will see *deflation*, which economists generally agree is worse than inflation, although I totally agree that the latter is bad as well.

    What we really want is for the demand of money to match supply. Then you have neither inflation or deflation. The idea that gold production, which historically has varied wildly, will somehow perfectly match the increase in T (e.g. money demand) is laughably absurd. And the fact that gold has non-monetary uses makes it even worse by further destabilizing demand (see my comment above).

    If you think gold-backed currency will stabilize prices, think again.

    , @Cloudbuster
    for me i guess the main issue is that metal cannot be moved all that fast, but digital money can move 12,000 miles instantly, the longest distance on the planet.

    You don't actually have to physically move metal at the speed of transactions. The debits and credits pile up and there are periodic transfers between banks and nations. Once upon a time a lot of this even happened within the same physical building, rendering it even easier.

    The transportability of gold is not an issue for a gold standard.
  50. Gold is also a fiat currency. The industrial demand for gold does nothing to justify even a fraction of its price. Not any different than the dollar except that it is harder to create more gold than dollars.

    Wrong. The demand for gold is far more cultural than industrial. The slice of time in history where gold has had industrial value is pretty small. It’s desirability predates industrial use by thousands of years. It’s cultural, and that’s good, because culture is a very difficult thing to negate (as hard as the left may try.)

    The only reason it is valuable is because everyone has agreed that it should be considered valuable.

    Again, culture at play. The universal desirability of gold and other precious metals might constitute the world’s original – and only lasting – monoculture. As long as people like shiny things, there will be a desire for gold, and the last time I drove by a new car dealership all the vehicles were shiny. (A very few have matte pseudo rat rod or paramilitary finishes, but that’s a fad.)

    Gold serves as a decent currency not because it is mostly useless, but because it can neither be created nor destroyed. In that way it fundamentally differs from fiat currencies, crypto, debt instruments, equities, and all other financial assets.

    Thank you.

    • Replies: @Buzz Mohawk
    All these people commenting about gold, I wonder how many actually own any, and how much. I have bought physical gold since the mid 1980s, and I have never regretted it. The first time was four Canadian gold leaf one ounce coins that I kept in my sock drawer.

    I occasionally bought silver then too. The first time was two ten-pound sacks of pre-1964 half-dollars. They are something like 90% silver, a known quantity. I sold them less than a year later at 20% profit. I did the same thing with the gold when I was ready.

    For whatever reason, I have never lost money on gold or silver. No, you cannot time the market, but if you are not greedy, you can keep substantial value stored in gold especially. If you think the human love for gold is going to suddenly disappear in your lifetime, you are a fool and should go buy more individual stocks in the company du jour.

    I have now for years held gold in kilo bars, primarily. The last time my wife and I bought a house, I cashed some in, again at a profit, for something like $50,000 each. Yes, that's right. The guys on here blabbing about gold remind me of the guys on here who blab about hot women and have never fucked one. Please excuse my language, but I am not sorry right now. I am not in the mood. Enjoy your free play money that I am paying for.
  51. @J1234

    Gold is also a fiat currency. The industrial demand for gold does nothing to justify even a fraction of its price. Not any different than the dollar except that it is harder to create more gold than dollars.
     
    Wrong. The demand for gold is far more cultural than industrial. The slice of time in history where gold has had industrial value is pretty small. It's desirability predates industrial use by thousands of years. It's cultural, and that's good, because culture is a very difficult thing to negate (as hard as the left may try.)

    The only reason it is valuable is because everyone has agreed that it should be considered valuable.
     
    Again, culture at play. The universal desirability of gold and other precious metals might constitute the world's original - and only lasting - monoculture. As long as people like shiny things, there will be a desire for gold, and the last time I drove by a new car dealership all the vehicles were shiny. (A very few have matte pseudo rat rod or paramilitary finishes, but that's a fad.)

    Gold serves as a decent currency not because it is mostly useless, but because it can neither be created nor destroyed. In that way it fundamentally differs from fiat currencies, crypto, debt instruments, equities, and all other financial assets.
     
    Thank you.

    All these people commenting about gold, I wonder how many actually own any, and how much. I have bought physical gold since the mid 1980s, and I have never regretted it. The first time was four Canadian gold leaf one ounce coins that I kept in my sock drawer.

    I occasionally bought silver then too. The first time was two ten-pound sacks of pre-1964 half-dollars. They are something like 90% silver, a known quantity. I sold them less than a year later at 20% profit. I did the same thing with the gold when I was ready.

    For whatever reason, I have never lost money on gold or silver. No, you cannot time the market, but if you are not greedy, you can keep substantial value stored in gold especially. If you think the human love for gold is going to suddenly disappear in your lifetime, you are a fool and should go buy more individual stocks in the company du jour.

    I have now for years held gold in kilo bars, primarily. The last time my wife and I bought a house, I cashed some in, again at a profit, for something like $50,000 each. Yes, that’s right. The guys on here blabbing about gold remind me of the guys on here who blab about hot women and have never fucked one. Please excuse my language, but I am not sorry right now. I am not in the mood. Enjoy your free play money that I am paying for.

    • Thanks: Audacious Epigone
    • Replies: @Elmer's Washable School Glue

    The last time my wife and I bought a house, I cashed some in, again at a profit, for something like $50,000 each... The guys on here blabbing about gold remind me of the guys on here who blab about hot women and have never fucked one. Please excuse my language, but I am not sorry right now. I am not in the mood. Enjoy your free play money that I am paying for.
     
    I am completely 100% behind gold as an investment and I congratulate you. Lots of things are good investments.

    But what makes gold desirable as an investment is precisely what makes it sub optimal as a currency: its price varies. It can go down or (hopefully) up. The price of money should not.
    , @Achmed E. Newman
    Firstly, Buzz, lots of people would probably rather not comment, as you did, if they still have gold and/or silver. I don't think it'd be a good idea.

    I occasionally bought silver then too. The first time was two ten-pound sacks of pre-1964 half-dollars. They are something like 90% silver, a known quantity. I sold them less than a year later at 20% profit. I did the same thing with the gold when I was ready.

    For whatever reason, I have never lost money on gold or silver.

    [SNIP]

    The last time my wife and I bought a house, I cashed some in, again at a profit, for something like $50,000 each.
     

    Buzz, though I agree with you on gold as REAL MONEY, as I'm sure you could have read already, if you have been owning it for this long, I'd have thought you could explain this better. Let me put it this way:

    It's not that you have made a profit here and there. If you own junk silver (pre-1965 coins, other than Nickels and Pennies, of course) of $10,000 face value, then you have ~7,200 tr. ounces of silver (I think that's the right number), PERIOD. If you have 300 tr. oz. of gold, well you have 300 tr. oz. of gold, PERIOD. The US $ may be thought to be worth less when you bought your house or more in the early 00's, but that's not the point for people who really see gold/silver as money.

    Whatever the fiat, backed-by-nothing-but "Good Faith and Credit" US dollar does, an ounce of gold is an ounce of gold, and an ounce of silver is an ounce of silver. That's how a true gold bug should see it.

  52. @Buzz Mohawk
    All these people commenting about gold, I wonder how many actually own any, and how much. I have bought physical gold since the mid 1980s, and I have never regretted it. The first time was four Canadian gold leaf one ounce coins that I kept in my sock drawer.

    I occasionally bought silver then too. The first time was two ten-pound sacks of pre-1964 half-dollars. They are something like 90% silver, a known quantity. I sold them less than a year later at 20% profit. I did the same thing with the gold when I was ready.

    For whatever reason, I have never lost money on gold or silver. No, you cannot time the market, but if you are not greedy, you can keep substantial value stored in gold especially. If you think the human love for gold is going to suddenly disappear in your lifetime, you are a fool and should go buy more individual stocks in the company du jour.

    I have now for years held gold in kilo bars, primarily. The last time my wife and I bought a house, I cashed some in, again at a profit, for something like $50,000 each. Yes, that's right. The guys on here blabbing about gold remind me of the guys on here who blab about hot women and have never fucked one. Please excuse my language, but I am not sorry right now. I am not in the mood. Enjoy your free play money that I am paying for.

    The last time my wife and I bought a house, I cashed some in, again at a profit, for something like $50,000 each… The guys on here blabbing about gold remind me of the guys on here who blab about hot women and have never fucked one. Please excuse my language, but I am not sorry right now. I am not in the mood. Enjoy your free play money that I am paying for.

    I am completely 100% behind gold as an investment and I congratulate you. Lots of things are good investments.

    But what makes gold desirable as an investment is precisely what makes it sub optimal as a currency: its price varies. It can go down or (hopefully) up. The price of money should not.

    • Replies: @Audacious Epigone
    If the price of money should not go up or down, we need to abolish the Fed, because interest rates are the price of money.
  53. @songbird
    I think Trump will win. If I understand correctly, his signature (photocopied) is on unemployment checks. (Someone correct me if I'm wrong).

    Whose signature will be on UBI? Someone not paying it, no doubt.

    Whose signature will be on UBI? Someone not paying it, no doubt.

    It should be the names of Richard Cloward and Frances Fox Piven.

  54. @EldnahYm
    Wrong. The U.S. fiscal policy had almost nothing to do with gold. The gold standard of that time was simply an agreement that other countries, which fixed the value of their currency to the U.S. dollar, could exchange their dollar holdings for gold at a fixed price. The U.S. already had the ability to print as much fiat currency as it wanted. Not that that matters much, monetary policy without fiscal support is toothless.

    If fiat currency is so wonderful why not print 100 million dollars for everybody?
     
    If fiat currency is so terrible why haven't incompetent governments already printed 100 million dollars and instituted $100 million handouts for everybody?

    Inflation is one answer to your question. Another is that there is no political will or reason to hand out 100 million dollars for everybody. If everyone has 100 million dollars, 100 million dollars is worthless. You should be able to answer this question yourself however.

    Cloudbuster’ comment # 47 is spot on…no need for me to reply.

  55. @prime noticer
    "Not any different than the dollar except that it is harder to create more gold than dollars."

    that being the entire point. avoiding all the 'new' issues of paper fiat inflation, fraud, and a money parasite class. i'm moderately onboard with metal as money. it made more sense, was more honest, and it's even in the Constitution. but i have no illusions about returning to metal for money.

    for me i guess the main issue is that metal cannot be moved all that fast, but digital money can move 12,000 miles instantly, the longest distance on the planet. that's a huge advantage. and i'm not talking about cryptocurrency, but digital ledgers representing paper bills that don't exist.

    in many ways digital money is as big of an advance over paper fiat as paper fiat is over metal, for purposes of efficiency and increasing the ease of economic activity. today, money can teleport. even after the advent of the telegraph 150 years ago and the ability to 'wire' money, the money still did not really teleport for practical purposes. physical money had to be at both ends of the telegraph.

    perhaps it would be possible to return to metal, with digital ledger claims on metal held in vaults used as the method to change ownership. but that's still just a claim on the metal. physical possession is 90% of the game, as they say. banks would be forced to return to holding tons of metal, which reintroduces the old security issues. eliminating the presence of physical money, as they're doing in Scandinavia, eliminates all the old security issues with money, which is on net positive versus the new, smaller issues of digital security.

    “Not any different than the dollar except that it is harder to create more gold than dollars.”

    that being the entire point. avoiding all the ‘new’ issues of paper fiat inflation, fraud, and a money parasite class. i’m moderately onboard with metal as money. it made more sense, was more honest, and it’s even in the Constitution.

    AE:

    Gold serves as a decent currency not because it is mostly useless, but because it can neither be created nor destroyed.

    Gold mines exist.

    You’re both basing your argument on the idea that the supply of gold will not grow faster than the demand. And to your credit you’re probably correct, although as other commentors have pointed out, there have been periods where big increases in gold production have caused catastrophic inflationary effects in gold-backed systems.

    Of course, there’s a flip side: if demand grows faster than supply we will see *deflation*, which economists generally agree is worse than inflation, although I totally agree that the latter is bad as well.

    What we really want is for the demand of money to match supply. Then you have neither inflation or deflation. The idea that gold production, which historically has varied wildly, will somehow perfectly match the increase in T (e.g. money demand) is laughably absurd. And the fact that gold has non-monetary uses makes it even worse by further destabilizing demand (see my comment above).

    If you think gold-backed currency will stabilize prices, think again.

    • Replies: @Audacious Epigone
    If you think gold-backed currency will stabilize prices, think again.

    The question is relative to what? Discovering gold--which has a predictable cost associated with it--is fundamentally different than being able to create gold. Creating fiat currency has no comparable cost to gold mining.

    Re: inflation versus deflation, I feel as though my standard of living has been improved much more by the deflation in consumer electronics than it has been by the inflation in real estate (or healthcare or education).
    , @Cloudbuster
    *deflation*, which economists generally agree is worse than inflation

    That sounds like economists of the current currency regime grifting people.

    In theory, the problem with deflation is that people find it more valuable to hold onto their money than to invest it in new productive endeavors.

    I don't buy that this would be a sustainable trend in the long term. There are always periods of short-term hoarding, but the need and desire for people to consume is literally wired into humanity. The man who gambles on a productive venture is very frequently going to come out way ahead of the man who sticks his gold under his mattress.

    Jesus wasn't an economist, but he spoke very pointedly on the matter (yes, I know that the economics isn't the point of the parable, but the assumptions surrounding the fact that he chose to present the parable in this fashion speak volumes):

    14 “For it is just like a man about to go on a journey, who called his own slaves and entrusted his possessions to them. 15 To one he gave five [a]talents, to another, two, and to another, one, each according to his own ability; and he went on his journey. 16 Immediately the one who had received the five talents went and traded with them, and gained five more talents. 17 In the same manner the one who had received the two talents gained two more. 18 But he who received the one talent went away, and dug a hole in the ground and hid his [b]master’s money.

    19 “Now after a long time the master of those slaves *came and *settled accounts with them. 20 The one who had received the five talents came up and brought five more talents, saying, ‘Master, you entrusted five talents to me. See, I have gained five more talents.’ 21 His master said to him, ‘Well done, good and faithful slave. You were faithful with a few things, I will put you in charge of many things; enter into the joy of your [c]master.’

    22 “Also the one who had received the two talents came up and said, ‘Master, you entrusted two talents to me. See, I have gained two more talents.’ 23 His master said to him, ‘Well done, good and faithful slave. You were faithful with a few things, I will put you in charge of many things; enter into the joy of your master.’

    24 “And the one also who had received the one talent came up and said, ‘Master, I knew you to be a hard man, reaping where you did not sow and gathering where you scattered no seed. 25 And I was afraid, and went away and hid your talent in the ground. See, you have what is yours.’

    26 “But his master answered and said to him, ‘You wicked, lazy slave, you knew that I reap where I did not sow and gather where I scattered no seed. 27 Then you ought to have put my money [d]in the bank, and on my arrival I would have received my money back with interest. 28 Therefore take away the talent from him, and give it to the one who has the ten talents.’
     
  56. @Jedi Night
    AE, I'm afraid your understanding of money is limited. Money does not require a perceived premium that exceeds its utility. In fact quite the opposite. Something can become money when it can be exchanged for other trade goods cheaply, the cheaper the better. Ideally money has zero value in itself.

    Real bills and checks are examples of this. Someone with a supply of something issues a note to take possession of it at a future date. Could be trade goods sitting on a ship at dock, could be the grain in a silo, or even a potential crop in the future. Could be tomorrow, next week, or months later. That bill circulates and is traded as a substitute of future value.

    That's right, the origin of paper money. Not even fiat sovereign money. It's real. It works fine.

    You tout gold because it can't be created but that is its huge flaw. Its supply cannot be increased to meet the demands of expanding trade. The lack of money supply constantly restricts trade. Worst of all, it empowers money holders to be a parasite class on the productive economy, empowered by the usury necessary to get money into supply.

    No one would ever go back to a gold backed money supply. It's like trying to sell a return to horses instead of cars, a huge step back wards. It's nonsensical.

    You aren't on the vanguard of monetary theory here. You are simply an intellectual stooge of a reactionary money power. Educate yourself. It's worth it. Free your mind. The truth shall set you free.

    “The lack of money supply constantly restricts trade.”

    i have never found this to be a totally convincing argument. the metal system is not perfect, but it’s better than the paper system in a lot of ways. metal money supply has issues, but they are less bad than paper money supply issues, in my opinion.

    also, they used several metals for money, not only gold. mining was the primary source of new money, and per French economist Michel Chevalier, when a new mine opened, the money supply got kind of messed up for a while, and the new supply of metal wasn’t a benefit for everybody equally. but eventually those effects worked themselves out.

    that they’re not able to fake the metal remains the main reason to use metal. that paper can be, and is always faked, is the main problem with it. modern tech makes this difference between metal and fiat much worse. with modern tech, it’s nearly impossible to fake or fraud the metal, as people did 1000 years ago. but once fiat becomes digital, the opportunity to fake it goes logarithmic.

    the main problem with metal remains that moving metal around is a hassle. not the supply of metal.

    “Worst of all, it empowers money holders to be a parasite class on the productive economy”

    this is just nuts, as far as i can tell. how would you describe year 2020 central banker jews then, exactly? doesn’t ‘Money printer go brrrrrr’ create a trillion times more opportunity for this versus metal? that wasn’t a number pulled out of thin air. isn’t the size and scope of the parasite class increased by 12 orders of magnitude by the current system?

  57. @prime noticer
    "Not any different than the dollar except that it is harder to create more gold than dollars."

    that being the entire point. avoiding all the 'new' issues of paper fiat inflation, fraud, and a money parasite class. i'm moderately onboard with metal as money. it made more sense, was more honest, and it's even in the Constitution. but i have no illusions about returning to metal for money.

    for me i guess the main issue is that metal cannot be moved all that fast, but digital money can move 12,000 miles instantly, the longest distance on the planet. that's a huge advantage. and i'm not talking about cryptocurrency, but digital ledgers representing paper bills that don't exist.

    in many ways digital money is as big of an advance over paper fiat as paper fiat is over metal, for purposes of efficiency and increasing the ease of economic activity. today, money can teleport. even after the advent of the telegraph 150 years ago and the ability to 'wire' money, the money still did not really teleport for practical purposes. physical money had to be at both ends of the telegraph.

    perhaps it would be possible to return to metal, with digital ledger claims on metal held in vaults used as the method to change ownership. but that's still just a claim on the metal. physical possession is 90% of the game, as they say. banks would be forced to return to holding tons of metal, which reintroduces the old security issues. eliminating the presence of physical money, as they're doing in Scandinavia, eliminates all the old security issues with money, which is on net positive versus the new, smaller issues of digital security.

    for me i guess the main issue is that metal cannot be moved all that fast, but digital money can move 12,000 miles instantly, the longest distance on the planet.

    You don’t actually have to physically move metal at the speed of transactions. The debits and credits pile up and there are periodic transfers between banks and nations. Once upon a time a lot of this even happened within the same physical building, rendering it even easier.

    The transportability of gold is not an issue for a gold standard.

    • Agree: Achmed E. Newman
    • Replies: @Audacious Epigone
    Indeed, this is what services like GoldMoney aim to do. And the electronic transfers would be seamless and nearly costless--much like Venmo--if not for the onerous reporting requirements, regulations, and tax consequences of it.
  58. “No one would ever go back to a gold backed money supply. It’s like trying to sell a return to horses instead of cars, a huge step back wards. It’s nonsensical.”

    yes, nobody WILL ever go back to metal for money. there’s too much to lose for the current ruling class by doing that, so it won’t happen. but no, i don’t think it’s a huge step backwards. it makes sense in some ways. in particular, i think simply using cell phones to make ownership transactions on metal sitting in a vault somewhere, might be preferable to the current system, for the great majority of earth’s citizens. not for the ruling class of course.

    cryptocurrency doesn’t make much sense. visa and mastercard operate electronic systems that handle millions of transactions concurrently. transaction limitations of bitcoin aside, any blockchain based cryptocurrency would just be too volume limited to be the default backbone transaction system.

    i’m not close minded on metal. i’m open to being convinced that basing money on almost nothing (really, basing it on future productive work capacity), is better than basing money on metal. but you’ll need to explain why having a permanent parasite class of central bankers who enrich themselves for the next thousand years on the labor of the other citizens and permanently control society, is the better tradeoff for the average person versus metal, and digital ledgers for transfering claims of control over metal.

    • Replies: @Jedi Night
    You get right to the heart of the matter p.n. This libertarian pro gold position is being sold as anti elite, as a way to rein in the parasites. It's just not true.

    Increasing money supply has nothing inherently to do with supporting the parasites. It could be used to support full employment and public banks.

    The parasites are enriched because they control government policy. The federal reserve system is intentionally firewalled from popular control.

    For example, allowing unlimited interest rates on credit cards, or limiting how much can be written off in bankruptcy, or making student loans non dischargable, these are all policies that advantage the parasites, passed by popular law. The majority of the recent bail out went to prop up the finance parasites. Why? Not because of electronic money, it's because Congress wanted it that way.

    The Libertarian hard money doctrine is nothing less that cointelpro. Legitimate grievances with the system are being hijacked and rerouted to a "solution" that is not.
  59. @DanHessinMD
    On the very strong humidity correlation with Corona, I was having a back and forth with Steve on his blog. He seems skeptical based on the single counterexample of Ecuador. To me the Ecuador case looks really fishy because there is no example like it in the tropics.

    He wrote:
    ------------------------------------
    Steve Sailer says: • Website
    April 26, 2020 at 3:49 am GMT
    @DanHessinMD

    “In Guayaquil, fatalities during the first two weeks of April were eight times higher than usual, the data indicates — a far greater rise than that of New York City, where fatalities were four times higher in recent weeks.”

    https://www.nytimes.com/2020/04/23/world/americas/ecuador-deaths-coronavirus.html

    -------------------------------------
    I replied, quoting the NYT article:

    @Steve Sailer

    “In another city hospital, the Teodoro Maldonado Carbo, a doctor who did not want to give his name because he has been asked not to speak to the media, described what he said were scenes out of a horror film.
    There were corpses in wheelchairs, in stretchers and on the floor in the emergency area, he said. The smell was such that the staff refused to enter.”

    Astonishing! That would really be an amazing photo. It would be the most viral picture in the world, really. And everyone has a smartphone.

    “The reek was insufferable,” he said. “The morgue was packed, as were the corridors — they were very long, and filled with corpses. The waiting room was filled with corpses.”

    That is quite the story.

    “Official figures show 128 died on April 15 in Guayas, the province that includes Guayaquil. That’s down from 614 on April 1.”

    So suddenly western media shows up and its all so much better…

    “The wave of deaths is all the more disturbing for being impossible to explain. There is no obvious reason for Ecuador to be devastated far more than other countries. Its population is relatively young, and most people live in rural areas, both factors that should reduce the risk, said Jenny Garcia, a demographer who studies Latin America at the Institut National d’Études Démographiques in France.”

    Yeah, this case does seem to stand all by its lonesome in comparison to the thousands of major cities and large towns across the entire tropical world.

    ““We will never know what the real number is, because there are no tests,” Ms. Viteri said.”

    No tests? The list of diseases that can have breakouts in Ecuador is really really long.

    Also the president is named after the original communist. That seems to relevant. There are a lot of reasons why this would be a useful story, including international aid.

    Steve, are there any other examples like this? It looks really shaky. Brazil had the virus lurking for a long time and has people stacked in filthy crowded favalas, with worse crowding than in New York. It’s fatality rate is meanwhile only 1/50th that of New York State.

    If the amazing benefit of humidity in this pandemic shown across the vast majority of data is to be ignored because of one counterexample, it might be good to take a look at that counterexample.
    This is what most of the other data show:

    https://www.marketwatch.com/story/this-stunning-chart-shows-the-coronavirus-spreading-slowly-in-tropical-countries-2020-03-17

    As I mentioned fairly early in the humidity conversations, the flu has different seasonality in the tropics.
    Influenza Seasonality in the Tropics and Subtropics – When to Vaccinate?
    https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0153003

    So something more than low humidity is a factor there. Perhaps the virus-humidity curve is U shaped?

  60. @prime noticer
    "No one would ever go back to a gold backed money supply. It’s like trying to sell a return to horses instead of cars, a huge step back wards. It’s nonsensical."

    yes, nobody WILL ever go back to metal for money. there's too much to lose for the current ruling class by doing that, so it won't happen. but no, i don't think it's a huge step backwards. it makes sense in some ways. in particular, i think simply using cell phones to make ownership transactions on metal sitting in a vault somewhere, might be preferable to the current system, for the great majority of earth's citizens. not for the ruling class of course.

    cryptocurrency doesn't make much sense. visa and mastercard operate electronic systems that handle millions of transactions concurrently. transaction limitations of bitcoin aside, any blockchain based cryptocurrency would just be too volume limited to be the default backbone transaction system.

    i'm not close minded on metal. i'm open to being convinced that basing money on almost nothing (really, basing it on future productive work capacity), is better than basing money on metal. but you'll need to explain why having a permanent parasite class of central bankers who enrich themselves for the next thousand years on the labor of the other citizens and permanently control society, is the better tradeoff for the average person versus metal, and digital ledgers for transfering claims of control over metal.

    You get right to the heart of the matter p.n. This libertarian pro gold position is being sold as anti elite, as a way to rein in the parasites. It’s just not true.

    Increasing money supply has nothing inherently to do with supporting the parasites. It could be used to support full employment and public banks.

    The parasites are enriched because they control government policy. The federal reserve system is intentionally firewalled from popular control.

    For example, allowing unlimited interest rates on credit cards, or limiting how much can be written off in bankruptcy, or making student loans non dischargable, these are all policies that advantage the parasites, passed by popular law. The majority of the recent bail out went to prop up the finance parasites. Why? Not because of electronic money, it’s because Congress wanted it that way.

    The Libertarian hard money doctrine is nothing less that cointelpro. Legitimate grievances with the system are being hijacked and rerouted to a “solution” that is not.

  61. You are rightly worried about the permanent parasite class, I’m right there with you. A real understanding of money allows us to defeat them, permanently.

    Once you understand how money is being created for free, out of thin air, you immediately ask, why aren’t interest free loans being given out? Banks are creating money, why are they charging us interest?

    Do we have to rely on banks to finance our lives (homes, educations, infrastructure investments)? No, we do not.

    There is no reason whatsoever that the parasites are skimming off the interest on everyone else’s productive activities.

    The traditional justification for usury is that you have to give someone incentive to lend you their money (risk, etc). Knowing that you can create money out of thin air, it literally destroys the justification for usury.

  62. @Buzz Mohawk
    All these people commenting about gold, I wonder how many actually own any, and how much. I have bought physical gold since the mid 1980s, and I have never regretted it. The first time was four Canadian gold leaf one ounce coins that I kept in my sock drawer.

    I occasionally bought silver then too. The first time was two ten-pound sacks of pre-1964 half-dollars. They are something like 90% silver, a known quantity. I sold them less than a year later at 20% profit. I did the same thing with the gold when I was ready.

    For whatever reason, I have never lost money on gold or silver. No, you cannot time the market, but if you are not greedy, you can keep substantial value stored in gold especially. If you think the human love for gold is going to suddenly disappear in your lifetime, you are a fool and should go buy more individual stocks in the company du jour.

    I have now for years held gold in kilo bars, primarily. The last time my wife and I bought a house, I cashed some in, again at a profit, for something like $50,000 each. Yes, that's right. The guys on here blabbing about gold remind me of the guys on here who blab about hot women and have never fucked one. Please excuse my language, but I am not sorry right now. I am not in the mood. Enjoy your free play money that I am paying for.

    Firstly, Buzz, lots of people would probably rather not comment, as you did, if they still have gold and/or silver. I don’t think it’d be a good idea.

    I occasionally bought silver then too. The first time was two ten-pound sacks of pre-1964 half-dollars. They are something like 90% silver, a known quantity. I sold them less than a year later at 20% profit. I did the same thing with the gold when I was ready.

    For whatever reason, I have never lost money on gold or silver.

    [SNIP]

    The last time my wife and I bought a house, I cashed some in, again at a profit, for something like $50,000 each.

    Buzz, though I agree with you on gold as REAL MONEY, as I’m sure you could have read already, if you have been owning it for this long, I’d have thought you could explain this better. Let me put it this way:

    It’s not that you have made a profit here and there. If you own junk silver (pre-1965 coins, other than Nickels and Pennies, of course) of $10,000 face value, then you have ~7,200 tr. ounces of silver (I think that’s the right number), PERIOD. If you have 300 tr. oz. of gold, well you have 300 tr. oz. of gold, PERIOD. The US $ may be thought to be worth less when you bought your house or more in the early 00’s, but that’s not the point for people who really see gold/silver as money.

    Whatever the fiat, backed-by-nothing-but “Good Faith and Credit” US dollar does, an ounce of gold is an ounce of gold, and an ounce of silver is an ounce of silver. That’s how a true gold bug should see it.

    • Replies: @Buzz Mohawk
    Yes, but I am describing my real experiences with gold and silver. You see, I am used to people criticizing it because they can't see it beating that stock market 100-year chart every stock broker shows them. (That's never adjusted for inflation, BTW.) Well, gold is not my only investment, but I store a lot of capital in it because it is a hedge against inflation. When I started buying gold, our country had just come off double-digit inflation.

    I was looking for a way to secure my "money" in a way that wouldn't allow it to be worth less a year later. My system worked, but metals have never been my money or my only store of value.

    I was a wholesaler for a family of mutual funds sold by a bank in the 1990s. I made money. Everybody made money. The market has tides that lift and lower all boats. The 90s were a great time to be a mutual fund salesman. I even visited the CNBC studios with a friend who was a regular guest. His topic of expertise: mutual funds. He showed me how he tracked them like sports teams.

    Eventually I realized that the indexes were beating most of the funds I was selling. You could just buy the Vanguard S&P 500 fund, with lower fees and fewer tax consequences, and do better than most of our fund managers. Fortunately my job changed shortly after my epiphany, so I didn't have to work with cognitive dissonance for too long.

    I love the dollar. I wish the dollar would be better protected. It is the world's currency, and that alone makes us Americans richer. I can still give a Benjamin to an in-law in Eastern Europe as a gift and they love it. It is just a nicely made piece of paper, but it features a deeply engraved portrait of one of the greatest men who ever lived, the "first American." I feel proud when I give that to a brother-in-law, for example, who is stuck over there with Romanian leu and Hungarian forints.

    So, I do not wish to replace the dollar, only to protect it. Sadly, our leaders are ruining it. The yuan awaits...

    I don't use gold as money. I exchange it for dollars when I need a lot of them, as in my real estate trade. You see, I couldn't just hand some bars to the real estate agent in exchange for the keys to the house, and I don't think that should ever happen. Should our dollar be linked back to gold? I don't often think about that, mostly because it will never happen, but also because I'm not so sure it matters.

  63. Are the people who are always whining about sheeple and following the herd the same ones now in a twitter over acquiring herd immunity?

  64. @DanHessinMD
    I am going to look at gold mining stocks tomorrow. What are the mining margins when oil is free and gold has a high price?

    The big question mark is whether or not the various mines will get hit hard enough by coronavirus shutdowns to be taken down by credit/cash flow problems. Some mining companies are going to do well.

  65. @advancedatheist
    Libertarians who advocate both the gold standard and the general cornucopianism of natural resources apparently don't see that these ideas make contradictory assumptions about Element 79 in the Periodic Table. What if some combination of technological breakthroughs turned gold into a throwaway commodity, like what has happened to aluminum over the last 200 years?

    Also gold depends on political construction to have "value." If our government refused to recognize gold as a form of property, and it didn't arrest and prosecute people who take anything made of gold without the original possessor's consent, then libertarians would see pretty quickly what their "sound money" amounts to.

    The search for a way to mine gold predates alchemy. It could happen. So could viable nuclear fusion or successful strategies for engineered negligible senescence. I suspect the global credit market will have long since unraveled before any of these things occur, though.

  66. Its all good fun until inflation comes back. Its the stagnant economy that UBI is aiming at.
    Deflation of demand and prices is inevitable without UBI.
    Inflation of prices and demand is inevitable with UBI.

    Pick your poison.

    There are no tweaks that will work anymore.

    • Replies: @Audacious Epigone
    My bet: UBI--and consumer price inflation--are coming.

    Buy inflation hedges and enjoy the UBI. The deluge has started. Might as well get yourself a watertight boat.

  67. @Jedi Night
    AE, I'm afraid your understanding of money is limited. Money does not require a perceived premium that exceeds its utility. In fact quite the opposite. Something can become money when it can be exchanged for other trade goods cheaply, the cheaper the better. Ideally money has zero value in itself.

    Real bills and checks are examples of this. Someone with a supply of something issues a note to take possession of it at a future date. Could be trade goods sitting on a ship at dock, could be the grain in a silo, or even a potential crop in the future. Could be tomorrow, next week, or months later. That bill circulates and is traded as a substitute of future value.

    That's right, the origin of paper money. Not even fiat sovereign money. It's real. It works fine.

    You tout gold because it can't be created but that is its huge flaw. Its supply cannot be increased to meet the demands of expanding trade. The lack of money supply constantly restricts trade. Worst of all, it empowers money holders to be a parasite class on the productive economy, empowered by the usury necessary to get money into supply.

    No one would ever go back to a gold backed money supply. It's like trying to sell a return to horses instead of cars, a huge step back wards. It's nonsensical.

    You aren't on the vanguard of monetary theory here. You are simply an intellectual stooge of a reactionary money power. Educate yourself. It's worth it. Free your mind. The truth shall set you free.

    The physical utility of a federal reserve note is virtually nil–it’s just a piece of paper. There is a huge premium placed on it, though, that is unrelated to its physical characteristics. There’s no disagreement here.

    What you deem parasitic “money holders” many other deem “savers”. The reason our liberties are being effortlessly taken away from us at the moment because there are vanishingly few said savers in the US. That’s how they get away with putting a $1200 piece of cheese in the 1990s Russia-style ‘relief bill’ and having everyone eagerly sign on.

    As for my putative stoogery, I’m fortunate to have not listened to many who personally advised against exiting the equity markets nearly in full last summer after getting spooked by the repo freeze up and putting the majority of that into metals. I sidestepped a freight train.

    • Replies: @Realist

    I’m fortunate to have not listened to many who personally advised against exiting the equity markets nearly in full last summer after getting spooked by the repo freeze up and putting the majority of that into metals.
     
    I did the same in August, 2019...but I have had gold for many years.
  68. @Dutch Boy
    The main appeal of gold to libertarians is that gold as currency is deflationary. Deflation favors creditors over debtors and libertarian economics is just an ideological defense of the creditor class.

    The main appeal of gold to libertarians is that gold as currency is deflationary. Deflation favors creditors over debtors and libertarian economics is just an ideological defense of the creditor class.

    Inflation discourages saving. Jobs come from business investment and business investment comes from savings so discouraging saving causes future job losses.

    Inflation raises domestic wages and makes American workers less competitive with foreign workers by raising the cost of American sold goods. This leads to trade deficits as consumers buy more foreign goods. Since the last link with gold was severed in 1970 inflation and trade deficits have steadily increased. If deflation was really bad and inflation was really good for the average American then the last fifty years of inflation should have improved things for them. Instead they have had stagnating wages as their former well paid jobs have been eliminated due to inflation and replaced by other lower paying jobs.

    It’s true that inflation means lower interest loans. You can either have lots of good jobs or low interest loans. You can’t have both. If people had good paying jobs they wouldn’t need to borrow as much money so you want to focus on job creation and not follow job destroying inflationary policies.

  69. @nebulafox
    Wasn't some form of this inevitable with automation, anyway? If so, then coronavirus is just opening the Overton Window a bit early.

    That’s my take on both UBI and the unwinding of the global credit system–both were coming, but coronavirus was the ultimate accelerationist.

    • Replies: @nebulafox
    >but coronavirus was the ultimate accelerationist.

    An aside, but kind of ironic that such a proto-Leninist term is so commonly used around these parts: it's Chernyshevsky's. He was the guy Dostoevsky savaged in Notes From the Underground, but Lenin utterly idolized his protagonist in his novel, What Is To Be Done?

    Then again, maybe not: maybe there are more lessons for the alt-right to be had when looking at the history of far-left radical movements in Europe, should things get ever really, really bad in the US. I know that there's a lot of stupid fascist admiration on Unz, but those movements had the tacit cooperation of the authorities as an unsightly bulwark against Communism, so they had more latitude to get away with stuff than their left-wing counterparts: the idiots in charge didn't realize that guys like Adolf Hitler had no intention of being dominated by anybody until it was too late, of course. Whereas the leftists had to fight-and nearly recover from collapse, in the case of the Russian Bolsheviks against the Okhrana-against official police sanction.

    In the near-term future environment, it is almost certainly going to be the other way around: just look at how Antifa gets treated by the police relative to any group that can be vaguely defined as right-wing.

  70. @Elmer's Washable School Glue

    Gold serves as a decent currency not because it is mostly useless, but because it can neither be created nor destroyed.
     
    Ok, let's assume, for the sake of argument, that a totally static money supply is desirable. Even then, "uselessness" is still a crucial component of currency.

    Let me elaborate: I'm assuming we can all agree that a stable price of money (e.g. little inflation or deflation) is a good thing. That should be our "goal." To do so we need to limit all sources of potential variability; we need supply and demand to remain constant in relation to each other. With a "useless" currency, we have one supply (how much money exists) and one demand (how many transactions occur per unit of time). With a "useful" currency, we still have one supply, but two demands: it's demand as a means of exchange, plus its demand for whatever additional use it has.

    Here's an example: something that's even harder to create or destroy than gold is land. It is totally possible to use land as a form of currency and has been done historically (property-backed notes were issued by the despicable French Revolutionary government). But it never lasted long, for an obvious reason: the price of land is volatile. A wheat field might be worth a lot, but then a glut of imported wheat arrives from some new colony and suddenly it is worth very little. A run-down Philly rowhome will see its value skyrocket as the neighborhood gentrifies. This volatility is lessened a bit in the aggregation, just as diversified stock portfolios are less volatile than particular stocks, but overall real estate prices still vary widely.

    So "useful" currency introduces an unwanted volatility in the price of money, triggering uncontrollable inflation or deflation totally unrelated to broader economic considerations. A farmer buying shoes from a cobbler in Bordeaux could have to pay twice as much as before because a bunch of North Africans migrants have cratered the price of land in Paris.

    _

    Therefore you want the "intrinsic" value of your currency (outside its exchange value) to be perfectly steady. Technically, it doesn't have to be valueless: if it has an intrinsic value that it always exactly the same, that would also be fine. But realistically, this never happens, leaving valueless currency as the best option.

    What is, on balance, both more steady in supply and of less intrinsic value than gold? What we get in the latter with fiat currency we lose and then some in the former.

    Bitcoin tries to be both steady in supply and of no intrinsic value. The glaring problem is that while the number of bitcoins are allegedly fixed, the number of competing crypto currencies are infinite.

    • Replies: @Elmer's Washable School Glue
    Gold is not steady in supply. It has relatively little intrinsic value, which is why it is superior to land or oil, but still some which further destabilizes its price compared to paper.

    Don't believe me? Here's a chart of US inflation rates 1914 to 2012: https://tradingeconomics.com/united-states/inflation-cpi

    Clearly, the gold era had far more volatility than the fiat era. We had peak inflation rates over 20% and deflation nearing 15% at times.

    If the price of money should not go up or down, we need to abolish the Fed, because interest rates are the price of money.
     
    Interest rates existed before the Fed was created, and would continue to exist if it was abolished. I'm not a huge fan of the Fed's monetary policy all the time, but overall, it has probably had a stabilizing effect.

    Re: inflation versus deflation, I feel as though my standard of living has been improved much more by the deflation in consumer electronics than it has been by the inflation in real estate (or healthcare or education).
     
    Money is perfectly fungible. Its price cannot inflate for some products while deflating for others. The reason electronics have seen price decreases is because the real value of the goods going into them has decreased. Ditto for skyrocketing college costs, even if most of those expenses are on useless administrators, they're still increasing real costs.

    Actual currency deflation has disastrous consequences for debt-using economies, leading to mass bankruptcies as people can't pay back the nominal value of their loans, the real value of which is constantly going up.

    ---

    I get your concern about fiat money having the potential for uncontrolled supply growth. It does have that potential. Basically, you need a government with some small degree of monetary discipline for fiat money to work, but when it does work, it is far, far superior to gold. Historically, the US and most other central banks have managed to do so. I'll concede that maybe Zimbabwe and Venezuela would be better off using gold. But unless you think this bailout is gonna put US inflation above 20%--and I'll take that bet in a heartbeat--gold is going to remain much more volatile than dollars. You need *gross* incompetence to perform as badly as gold does.
  71. @songbird
    I think Trump will win. If I understand correctly, his signature (photocopied) is on unemployment checks. (Someone correct me if I'm wrong).

    Whose signature will be on UBI? Someone not paying it, no doubt.

    His signature is on a physical letter that is sent out via snail mail at around the time the electronic transfers were made.

    • Replies: @songbird
    Ah, that makes sense. I'm not sure how welfare works exactly, but I heard that there's something similar. That is, maybe it is mainly electronic, but every so often they send a letter out that in effect says "vote for me (or us)." And sometimes, "are you registered to vote?" or "Here's a bonus, right before the election."

    I'm wondering how that would work with UBI. I figure some pol would try to take credit for it, or get their hands on a cut of it. "UBI tax." Maybe, mandatory voting comes along with UBI.
  72. @Dutch Boy
    The main appeal of gold to libertarians is that gold as currency is deflationary. Deflation favors creditors over debtors and libertarian economics is just an ideological defense of the creditor class.

    The big investment banks are the ultimate creditors. They love the current system and loathe the idea of sound money of any kind. Fiat currency is another example of the top (creditors) and the bottom (debtors) against the middle (savers).

    • Replies: @utu
    "They love the current system..." - They might be the only ones who understand it. They are the only ones who are in the position to write bills and lobby for them to make changes they want. Their 'reforms' go uncontested which was not a case in 1930th.

    "and loathe the idea of sound money of any kind." - Sound money does not really exit. Ideas of it do exist but any money can always be corrupted. One reason real gold or silver money was replaced with bills of exchange because the gold coins could not be trusted; almost every body was engaging in diluting gold or silver in their coins and thus in the process it was discovered you do not need gold or silver to run the economy.
  73. @Mr. Rational

    You tout gold because it can’t be created but that is its huge flaw. Its supply cannot be increased to meet the demands of expanding trade.
     
    If anyone can create money, that money has no value.  For anything, including as a medium of exchange.  If I could conjure a million dollars out of thin air with no effort, I could buy cars, buildings, airplanes and even yachts that took great effort to make... at least until the owners got wise and refused to take dollars in exchange for actual goods.

    To be worthwhile as money, it must be difficult or impossible to counterfeit.  That is the weakness of all fiat currencies, and why all of them collapse.  After the dollar is gone, Bitcoin will still be around.

    What’s your response to objection that while a finite number of Bitcoin exist, an infinite number of cryptocurrencies do? How does Bitcoin ensure it is digital gold and the rest are digital pyrite?

    I’m not trying to be adversarial here–I’m genuinely curious. That concern is the one that has kept me from making the leap, much as I’d love for Bitcoin to succeed (not just in making the early adopters rich, but in actually competing with fiat currencies).

    • Replies: @Mr. Rational

    What’s your response to objection that while a finite number of Bitcoin exist, an infinite number of cryptocurrencies do? How does Bitcoin ensure it is digital gold and the rest are digital pyrite?
     
    "I don't have an answer, but I certainly appreciate the question."

    (I believe that came from Ashleigh Brilliant, but I can't find a reference ATM.)
  74. @Twinkie

    My wife and I don’t qualify for this pittance that is being distributed, due to the numbers on our tax returns being just a little bit too high.
     
    Forget a little bit too high, my wife and I get pretty much no deduction on our tax return. Everything (child credit, medical expenses, QBI, etc.) is phased out, because we earn too much. I try to be grateful for the financial condition we are in, but when I go over my return and see all the things for which we do not qualify, I do get a bit peeved.

    That you still engage in the charitable acts you do is very laudable. It’d be easy to say “I’ve already paid way more than my fair share, I’m done”, I’d think.

    • Replies: @Twinkie
    Thank you, but I don’t see the two in the same vein. Charity is something I choose to do. Taxation is imposed by force.
  75. @Cloudbuster
    The gold standard of that time was simply an agreement that other countries, which fixed the value of their currency to the U.S. dollar, could exchange their dollar holdings for gold at a fixed price. The U.S. already had the ability to print as much fiat currency as it wanted.

    You understand the import of that statement explains exactly why the US government couldn't print as much money as it wanted: the requirement that it be able to exchange dollars for gold at a fixed price. The government can always print paper money in a certain excess of gold holdings, but if people realize that the government is abusing this power, you get bank runs as people ditch your currency.

    Inflation is one answer to your question. Another is that there is no political will or reason to hand out 100 million dollars for everybody. If everyone has 100 million dollars, 100 million dollars is worthless. Once upon

    Inflation is the name of the game. The government loves a certain amount of inflation. The only reason it doesn't love a ton of inflation is that it makes the scam too obvious. We've been running an inflationary economy since the Great Depression. It functions as a non-legislated wealth tax. Historically speaking $100 million dollars is now nearly worthless compared to what it could buy in 1900 (about $3 billion in today's dollars). The federal government just printed several trillion dollars of fiat money, most of which went to banks and a pittance of which went to individuals and small businesses as a PR stunt.

    They've been doing that repeatedly, in smaller amounts for a couple decades now. But typically most of it isn't allowed in general circulation, which is why the velocity of the dollar has been plummeting for decades -- most of the dollars don't actually circulate, they just sit there as debt instruments. That's why inflation hasn't risen yet.

    They're playing a dangerous game. It's a huge house of cards. I couldn't say how long it can last, but it definitely isn't healthy. Every year the government outspends its revenues by 2-3x. There is simply no way to generate enough revenue to make a dent in that -- you might as well stop collecting revenue completely for all the good it does.

    There is no strategy to do anything about this except trying to slowly bleed the debt away through inflation -- they would really love to have them some more inflation, but the debt has become so expensive that even small amounts of additional inflation can be catastrophic, so they're slowly backing themselves into a corner.

    That's what fiat money does.

    Spending is going to outstrip revenues by a lot more than 2x-3x this year. And next year, and the year after that. As for slowly backing itself into a corner, it’s already there. It has been since at least late 2018, when a gentle move towards upping rates and unwinding the balance sheet crashed the stock market.

    • Agree: Cloudbuster
    • Replies: @Realist

    Spending is going to outstrip revenues by a lot more than 2x-3x this year. And next year, and the year after that.
     
    That's for sure.
  76. @Elmer's Washable School Glue

    The last time my wife and I bought a house, I cashed some in, again at a profit, for something like $50,000 each... The guys on here blabbing about gold remind me of the guys on here who blab about hot women and have never fucked one. Please excuse my language, but I am not sorry right now. I am not in the mood. Enjoy your free play money that I am paying for.
     
    I am completely 100% behind gold as an investment and I congratulate you. Lots of things are good investments.

    But what makes gold desirable as an investment is precisely what makes it sub optimal as a currency: its price varies. It can go down or (hopefully) up. The price of money should not.

    If the price of money should not go up or down, we need to abolish the Fed, because interest rates are the price of money.

  77. @Elmer's Washable School Glue

    “Not any different than the dollar except that it is harder to create more gold than dollars.”

    that being the entire point. avoiding all the ‘new’ issues of paper fiat inflation, fraud, and a money parasite class. i’m moderately onboard with metal as money. it made more sense, was more honest, and it’s even in the Constitution.
     

    AE:

    Gold serves as a decent currency not because it is mostly useless, but because it can neither be created nor destroyed.
     
    Gold mines exist.

    You're both basing your argument on the idea that the supply of gold will not grow faster than the demand. And to your credit you're probably correct, although as other commentors have pointed out, there have been periods where big increases in gold production have caused catastrophic inflationary effects in gold-backed systems.

    Of course, there's a flip side: if demand grows faster than supply we will see *deflation*, which economists generally agree is worse than inflation, although I totally agree that the latter is bad as well.

    What we really want is for the demand of money to match supply. Then you have neither inflation or deflation. The idea that gold production, which historically has varied wildly, will somehow perfectly match the increase in T (e.g. money demand) is laughably absurd. And the fact that gold has non-monetary uses makes it even worse by further destabilizing demand (see my comment above).

    If you think gold-backed currency will stabilize prices, think again.

    If you think gold-backed currency will stabilize prices, think again.

    The question is relative to what? Discovering gold–which has a predictable cost associated with it–is fundamentally different than being able to create gold. Creating fiat currency has no comparable cost to gold mining.

    Re: inflation versus deflation, I feel as though my standard of living has been improved much more by the deflation in consumer electronics than it has been by the inflation in real estate (or healthcare or education).

    • Replies: @Realist

    Creating fiat currency has no comparable cost to gold mining.
     
    You point is correct....but the cost of fiat money has yet to fully hit this country.
  78. @Cloudbuster
    for me i guess the main issue is that metal cannot be moved all that fast, but digital money can move 12,000 miles instantly, the longest distance on the planet.

    You don't actually have to physically move metal at the speed of transactions. The debits and credits pile up and there are periodic transfers between banks and nations. Once upon a time a lot of this even happened within the same physical building, rendering it even easier.

    The transportability of gold is not an issue for a gold standard.

    Indeed, this is what services like GoldMoney aim to do. And the electronic transfers would be seamless and nearly costless–much like Venmo–if not for the onerous reporting requirements, regulations, and tax consequences of it.

  79. @Dr. Doom
    Its all good fun until inflation comes back. Its the stagnant economy that UBI is aiming at.
    Deflation of demand and prices is inevitable without UBI.
    Inflation of prices and demand is inevitable with UBI.

    Pick your poison.

    There are no tweaks that will work anymore.

    My bet: UBI–and consumer price inflation–are coming.

    Buy inflation hedges and enjoy the UBI. The deluge has started. Might as well get yourself a watertight boat.

    • Agree: Buzz Mohawk
  80. @Achmed E. Newman
    Thanks, A123. I never thought Socialism would ramp up this quick, but they have not been wasting this purported "crisis". I'll give 'em all credit for that, as evil as it is. Both the Socialists with their putting half the country on the dole, and the other Totalitarians, with their LOCKDOWNS and SHELTER-IN-PLACES and other bullshit, have taken full advantage.

    I never thought I'd get that pissed about this, but when I saw my power bill, with their message about power not being turned off for non-payment, that got me really thinking yesterday. Being a responsible person will no longer pay in this country! I really don't know what the plan for me and my family will be now.

    If that last paragraph sounds hyperbolic, well, this stuff is really coming to a head now. All these dense-headed Socialists will only learn the lesson when it's too late. The more that responsible people are screwed over left and right, the fewer responsible people there will be left. How do you come out of that?

    A.E., thank you for the posts on the financial aspect of this Kung Flu Infotainment Panic Fest. This is a MUCH BIGGER deal than the issue of the virus itself.

    One doesn’t come out of it, AE. A reckoning is coming. I was hoping that it might hold off 12 or 15 years so that I could have departed this life. The consequences of the virus panic might dash my hopes. One quibble with your attribution of this state of affairs to Socialists. I see pols of the Right-wing party and corporate nabobs jumping on this pass out the money train. I’d say that what we have here is actually existing capitalism.

    • Replies: @Achmed E. Newman
    Yeah, it's just a quibble over definitions, Mr. Blanc. Everyone is trying to get on the gravy train, true. You've got your Socialists trying to get everyone strung out on Uncle Sugar, and then the "Crony Capitalists" just wanting the cash for themselves (before the inflation catches up). The latter usually get the bigger share too!
  81. @Audacious Epigone
    His signature is on a physical letter that is sent out via snail mail at around the time the electronic transfers were made.

    Ah, that makes sense. I’m not sure how welfare works exactly, but I heard that there’s something similar. That is, maybe it is mainly electronic, but every so often they send a letter out that in effect says “vote for me (or us).” And sometimes, “are you registered to vote?” or “Here’s a bonus, right before the election.”

    I’m wondering how that would work with UBI. I figure some pol would try to take credit for it, or get their hands on a cut of it. “UBI tax.” Maybe, mandatory voting comes along with UBI.

  82. @Daniel H
    Sounds like a plan everyone would love.

    To return manufacturing to America, to create better quality jobs, to lessen income inequality, it would be worth it that the consumer pays a little more.

    To return manufacturing to America, to create better quality jobs, to lessen income inequality, it would be worth it that the consumer pays a little more.

    The consumer might not agree.

    What surprises me these days is to see so many people on the Right embracing statist authoritarian solutions. I see right-wingers arguing that if consumers don’t want to pay higher prices we’ll just get the government to force them to do so. In fact the far right seems to be getting more and more authoritarian in outlook.

    It’s also amusing to see people on the Right embracing the idea of central economic planning. Maybe we need a Five Year Plan to increase manufacturing. Lenin and Stalin, wherever they might be now, must be having a good old chortle about this. Or maybe we need a Great Leap Forward.

    • Replies: @William D. Wall
    It seems you have confused right wing with libertarian in outlook. While this became more and more the case in the US after WWII and especially post-Civil Rights era, it is not something inherent to the right. In fact, you could make an argument that libertarian perspectives were memed into the right wing at first to counter communism, then later counter the Civil Rights era through implicit rather than explicit means.

    Many liberty-centric positions are in fact not right wing at all.
  83. @Justvisiting
    E-books are great--until the censors start deleting parts or all of the electronic books deemed too sensitive for human consumption.

    Most of my print library would be censored for a thousand reasons in a future dystopia--racist, sexist, homophobe, anti-government, etc etc etc--and most of it is science fiction.

    E-books are great–until the censors start deleting parts or all of the electronic books deemed too sensitive for human consumption.

    Most of my print library would be censored for a thousand reasons in a future dystopia–racist, sexist, homophobe, anti-government, etc etc etc–and most of it is science fiction.

    Yep. E-books were the worst idea in history. Incredibly Orwellian.

    But people are more and more willing to embrace authoritarianism and social control. People who buy e-books seem to be quite happy to be told what they can and can’t read.

  84. @Achmed E. Newman
    Firstly, Buzz, lots of people would probably rather not comment, as you did, if they still have gold and/or silver. I don't think it'd be a good idea.

    I occasionally bought silver then too. The first time was two ten-pound sacks of pre-1964 half-dollars. They are something like 90% silver, a known quantity. I sold them less than a year later at 20% profit. I did the same thing with the gold when I was ready.

    For whatever reason, I have never lost money on gold or silver.

    [SNIP]

    The last time my wife and I bought a house, I cashed some in, again at a profit, for something like $50,000 each.
     

    Buzz, though I agree with you on gold as REAL MONEY, as I'm sure you could have read already, if you have been owning it for this long, I'd have thought you could explain this better. Let me put it this way:

    It's not that you have made a profit here and there. If you own junk silver (pre-1965 coins, other than Nickels and Pennies, of course) of $10,000 face value, then you have ~7,200 tr. ounces of silver (I think that's the right number), PERIOD. If you have 300 tr. oz. of gold, well you have 300 tr. oz. of gold, PERIOD. The US $ may be thought to be worth less when you bought your house or more in the early 00's, but that's not the point for people who really see gold/silver as money.

    Whatever the fiat, backed-by-nothing-but "Good Faith and Credit" US dollar does, an ounce of gold is an ounce of gold, and an ounce of silver is an ounce of silver. That's how a true gold bug should see it.

    Yes, but I am describing my real experiences with gold and silver. You see, I am used to people criticizing it because they can’t see it beating that stock market 100-year chart every stock broker shows them. (That’s never adjusted for inflation, BTW.) Well, gold is not my only investment, but I store a lot of capital in it because it is a hedge against inflation. When I started buying gold, our country had just come off double-digit inflation.

    I was looking for a way to secure my “money” in a way that wouldn’t allow it to be worth less a year later. My system worked, but metals have never been my money or my only store of value.

    I was a wholesaler for a family of mutual funds sold by a bank in the 1990s. I made money. Everybody made money. The market has tides that lift and lower all boats. The 90s were a great time to be a mutual fund salesman. I even visited the CNBC studios with a friend who was a regular guest. His topic of expertise: mutual funds. He showed me how he tracked them like sports teams.

    Eventually I realized that the indexes were beating most of the funds I was selling. You could just buy the Vanguard S&P 500 fund, with lower fees and fewer tax consequences, and do better than most of our fund managers. Fortunately my job changed shortly after my epiphany, so I didn’t have to work with cognitive dissonance for too long.

    I love the dollar. I wish the dollar would be better protected. It is the world’s currency, and that alone makes us Americans richer. I can still give a Benjamin to an in-law in Eastern Europe as a gift and they love it. It is just a nicely made piece of paper, but it features a deeply engraved portrait of one of the greatest men who ever lived, the “first American.” I feel proud when I give that to a brother-in-law, for example, who is stuck over there with Romanian leu and Hungarian forints.

    So, I do not wish to replace the dollar, only to protect it. Sadly, our leaders are ruining it. The yuan awaits…

    I don’t use gold as money. I exchange it for dollars when I need a lot of them, as in my real estate trade. You see, I couldn’t just hand some bars to the real estate agent in exchange for the keys to the house, and I don’t think that should ever happen. Should our dollar be linked back to gold? I don’t often think about that, mostly because it will never happen, but also because I’m not so sure it matters.

    • Thanks: Audacious Epigone
    • Replies: @Achmed E. Newman
    Yes, the $ is the world's reserve currency, but that CANNOT last with the way the Feral Gov't has been treating it. The US had a good reputation everywhere around the world at the end of the Cold War but has been blowing that goodwill AND blowing the trust in the dollar by "printing" like mad.

    The only way to save the Dollar is to kill the Dollar, with real Americans coming up with a Real Dollar. That Real Dollar would have to backed by something that no one can make more of for nothing, meaning gold.

    Ron Paul is right.
  85. @Audacious Epigone
    That you still engage in the charitable acts you do is very laudable. It'd be easy to say "I've already paid way more than my fair share, I'm done", I'd think.

    Thank you, but I don’t see the two in the same vein. Charity is something I choose to do. Taxation is imposed by force.

    • Agree: Audacious Epigone
  86. @Audacious Epigone
    That's my take on both UBI and the unwinding of the global credit system--both were coming, but coronavirus was the ultimate accelerationist.

    >but coronavirus was the ultimate accelerationist.

    An aside, but kind of ironic that such a proto-Leninist term is so commonly used around these parts: it’s Chernyshevsky’s. He was the guy Dostoevsky savaged in Notes From the Underground, but Lenin utterly idolized his protagonist in his novel, What Is To Be Done?

    Then again, maybe not: maybe there are more lessons for the alt-right to be had when looking at the history of far-left radical movements in Europe, should things get ever really, really bad in the US. I know that there’s a lot of stupid fascist admiration on Unz, but those movements had the tacit cooperation of the authorities as an unsightly bulwark against Communism, so they had more latitude to get away with stuff than their left-wing counterparts: the idiots in charge didn’t realize that guys like Adolf Hitler had no intention of being dominated by anybody until it was too late, of course. Whereas the leftists had to fight-and nearly recover from collapse, in the case of the Russian Bolsheviks against the Okhrana-against official police sanction.

    In the near-term future environment, it is almost certainly going to be the other way around: just look at how Antifa gets treated by the police relative to any group that can be vaguely defined as right-wing.

  87. @MBlanc46
    One doesn’t come out of it, AE. A reckoning is coming. I was hoping that it might hold off 12 or 15 years so that I could have departed this life. The consequences of the virus panic might dash my hopes. One quibble with your attribution of this state of affairs to Socialists. I see pols of the Right-wing party and corporate nabobs jumping on this pass out the money train. I’d say that what we have here is actually existing capitalism.

    Yeah, it’s just a quibble over definitions, Mr. Blanc. Everyone is trying to get on the gravy train, true. You’ve got your Socialists trying to get everyone strung out on Uncle Sugar, and then the “Crony Capitalists” just wanting the cash for themselves (before the inflation catches up). The latter usually get the bigger share too!

  88. @Buzz Mohawk
    Yes, but I am describing my real experiences with gold and silver. You see, I am used to people criticizing it because they can't see it beating that stock market 100-year chart every stock broker shows them. (That's never adjusted for inflation, BTW.) Well, gold is not my only investment, but I store a lot of capital in it because it is a hedge against inflation. When I started buying gold, our country had just come off double-digit inflation.

    I was looking for a way to secure my "money" in a way that wouldn't allow it to be worth less a year later. My system worked, but metals have never been my money or my only store of value.

    I was a wholesaler for a family of mutual funds sold by a bank in the 1990s. I made money. Everybody made money. The market has tides that lift and lower all boats. The 90s were a great time to be a mutual fund salesman. I even visited the CNBC studios with a friend who was a regular guest. His topic of expertise: mutual funds. He showed me how he tracked them like sports teams.

    Eventually I realized that the indexes were beating most of the funds I was selling. You could just buy the Vanguard S&P 500 fund, with lower fees and fewer tax consequences, and do better than most of our fund managers. Fortunately my job changed shortly after my epiphany, so I didn't have to work with cognitive dissonance for too long.

    I love the dollar. I wish the dollar would be better protected. It is the world's currency, and that alone makes us Americans richer. I can still give a Benjamin to an in-law in Eastern Europe as a gift and they love it. It is just a nicely made piece of paper, but it features a deeply engraved portrait of one of the greatest men who ever lived, the "first American." I feel proud when I give that to a brother-in-law, for example, who is stuck over there with Romanian leu and Hungarian forints.

    So, I do not wish to replace the dollar, only to protect it. Sadly, our leaders are ruining it. The yuan awaits...

    I don't use gold as money. I exchange it for dollars when I need a lot of them, as in my real estate trade. You see, I couldn't just hand some bars to the real estate agent in exchange for the keys to the house, and I don't think that should ever happen. Should our dollar be linked back to gold? I don't often think about that, mostly because it will never happen, but also because I'm not so sure it matters.

    Yes, the $ is the world’s reserve currency, but that CANNOT last with the way the Feral Gov’t has been treating it. The US had a good reputation everywhere around the world at the end of the Cold War but has been blowing that goodwill AND blowing the trust in the dollar by “printing” like mad.

    The only way to save the Dollar is to kill the Dollar, with real Americans coming up with a Real Dollar. That Real Dollar would have to backed by something that no one can make more of for nothing, meaning gold.

    Ron Paul is right.

    • Agree: Mr. Rational, Mark G.
    • Replies: @Buzz Mohawk

    Yes, the $ is the world’s reserve currency, but that CANNOT last with the way the Feral Gov’t has been treating it. The US had a good reputation everywhere around the world at the end of the Cold War but has been blowing that goodwill AND blowing the trust in the dollar by “printing” like mad.
     
    I agree wholeheartedly.

    BTW A.E.'s blog is quite good, and there are some good discussions on here.

    , @Adam Smith

    the $ is the world’s reserve currency, but that CANNOT last
     
    All part of the plan...

    https://www.aier.org/wp-content/uploads/2019/06/Reserve-Currencies.png
  89. @A123

    No, I think it MAY be as bad as I can imagine, A123. I give it 50/50. That’s the way things go when a country turns Socialist. It’s not that I begrudge people a little break on late fees, etc. No, what I see is that people are now incentivized to let the bill go for many months. Then, when people all over the area, owe $500 to $1,500 dollars, the company will bail them out, using a portion of bail-out money being paid by us taxpayers.
     
    While not impossible, this sort of slow bleed problem does not seem like the biggest risk.

    The utility company is not going to have *Disconnect Day* where everyone who is behind is hit simultaneously. They will have a rolling program to cutoff offenders in a gradual way. If the media latches onto a specific family and tries to use them as the "cause", that family will likely get a bail out. However, the slow grinding process of one by one collection will continue.

    The big dollar amounts are in things like Student Loans, Mortgages, Auto Loans, and Credit Cards. Those are where the Moral Hazard risks lie.

    PEACE 😷

    A123, no, they will not have “Disconnect Day”. What I can foresee is that a huge chunk of their customers will be behind by a huge amount (relatively to their normal bill) that they can’t or won’t pay. The power company will have a great excuse (maybe already has tried it) to get on that gravy train – there are plenty of hundreds of millions within 2 or more trillions to go around, folks! “The formerly LOCKED-DOWN folks can’t pay – you must help us help them, Uncle Sugar! We’ll keep just a little bit of it too, for all the admin. work, of course …”

    As usual, the responsible ones in the middle class, I mean what’s left of it, will get screwed. I’m not saying this is for sure what will happen, but this kind of thing will be increasingly likely, as we enter hardcore Socialism or whatever one might like to call it.

    • Replies: @dfordoom

    What I can foresee is that a huge chunk of their customers will be behind by a huge amount (relatively to their normal bill) that they can’t or won’t pay. The power company will have a great excuse (maybe already has tried it) to get on that gravy train – there are plenty of hundreds of millions within 2 or more trillions to go around, folks! “The formerly LOCKED-DOWN folks can’t pay – you must help us help them, Uncle Sugar!
     
    OK, you're probably right about that, but what's your answer? If someone has been thrown out of work through no fault of their own due to the Corona Hysteria and can't pay their electricity bill do we just let them freeze to death come winter?

    If you don't like commie solutions then you have to come up with viable alternatives. That's going to be the problem for the Economic Right in the wake of this crisis - if they can't offer solutions then people will look to socialist solutions. Corona Hysteria has the potential to seriously discredit the Economic Right.
    , @A123
    There are other more aggressive players looking for handouts.

    Tyson Foods springs to mind:

    https://twitter.com/TheCounter/status/1254869252764585984?s=20

    PEACE 😷
    , @Neuday
    Nobody has to pay their damned power bills. All you have to do is be on welfare, and whitey pays for it.

    Haven't you ever heard of LIHEAP?

    Low Income Home Energy Assistance Program (LIHEAP)
  90. @Audacious Epigone
    What's your response to objection that while a finite number of Bitcoin exist, an infinite number of cryptocurrencies do? How does Bitcoin ensure it is digital gold and the rest are digital pyrite?

    I'm not trying to be adversarial here--I'm genuinely curious. That concern is the one that has kept me from making the leap, much as I'd love for Bitcoin to succeed (not just in making the early adopters rich, but in actually competing with fiat currencies).

    What’s your response to objection that while a finite number of Bitcoin exist, an infinite number of cryptocurrencies do? How does Bitcoin ensure it is digital gold and the rest are digital pyrite?

    “I don’t have an answer, but I certainly appreciate the question.”

    (I believe that came from Ashleigh Brilliant, but I can’t find a reference ATM.)

    • Thanks: Audacious Epigone
  91. “Does anyone think that, three months out from the general election, anyone from either party is going to oppose extending them through the end of the year, or of even making them permanent?”

    This is fairly likely, however, it’s also going to 1) massively inflate prices, 2) kill the bond market.

    Depending on how long #2 takes (it’s been predicted for decades and hasn’t happened yet), we might live in wheelbarrow-wallet land for a while. But eventualy we can presumably expect 3) a banking collapse, 4) massive deflation.

    Followed by a new currency designed from scratch. I propose copper dollar coins, for the anti-microbial properties, alloyed with just a little bit of gold for the magical voodoo homeopathic effect. Increase the gold proportion for the 5-dollar, 20-dollar, 50-dollar, and 100-dollar coins.

    Thinking about it – we can put off killing the bond market for a while. Just announce that all Treasury bonds within certain specified ranges, WHICH BY A COMPLETE COINCIDENCE just so happen to be those currently held by China, are having their interest payments “temporarily” suspended “for the duration of the crisis” and that we’re sure everybody and most particularly our good Chinese friends will understand. (Oh, they’ll understand, all right.) Just make sure to do that AFTER pharmaceutical manufacture and rare earth processing has gotten going again somewhere in the continental USA.

  92. @Audacious Epigone
    What is, on balance, both more steady in supply and of less intrinsic value than gold? What we get in the latter with fiat currency we lose and then some in the former.

    Bitcoin tries to be both steady in supply and of no intrinsic value. The glaring problem is that while the number of bitcoins are allegedly fixed, the number of competing crypto currencies are infinite.

    Gold is not steady in supply. It has relatively little intrinsic value, which is why it is superior to land or oil, but still some which further destabilizes its price compared to paper.

    Don’t believe me? Here’s a chart of US inflation rates 1914 to 2012: https://tradingeconomics.com/united-states/inflation-cpi

    Clearly, the gold era had far more volatility than the fiat era. We had peak inflation rates over 20% and deflation nearing 15% at times.

    If the price of money should not go up or down, we need to abolish the Fed, because interest rates are the price of money.

    Interest rates existed before the Fed was created, and would continue to exist if it was abolished. I’m not a huge fan of the Fed’s monetary policy all the time, but overall, it has probably had a stabilizing effect.

    Re: inflation versus deflation, I feel as though my standard of living has been improved much more by the deflation in consumer electronics than it has been by the inflation in real estate (or healthcare or education).

    Money is perfectly fungible. Its price cannot inflate for some products while deflating for others. The reason electronics have seen price decreases is because the real value of the goods going into them has decreased. Ditto for skyrocketing college costs, even if most of those expenses are on useless administrators, they’re still increasing real costs.

    Actual currency deflation has disastrous consequences for debt-using economies, leading to mass bankruptcies as people can’t pay back the nominal value of their loans, the real value of which is constantly going up.

    I get your concern about fiat money having the potential for uncontrolled supply growth. It does have that potential. Basically, you need a government with some small degree of monetary discipline for fiat money to work, but when it does work, it is far, far superior to gold. Historically, the US and most other central banks have managed to do so. I’ll concede that maybe Zimbabwe and Venezuela would be better off using gold. But unless you think this bailout is gonna put US inflation above 20%–and I’ll take that bet in a heartbeat–gold is going to remain much more volatile than dollars. You need *gross* incompetence to perform as badly as gold does.

    • Thanks: Audacious Epigone
    • Replies: @DanHessinMD
    "You need *gross* incompetence to perform as badly as gold does."

    This is massively moving the goalposts. I presume you are comparing gold against stocks.

    The post is about gold as currency. For consistency, you would have to compare gold against its competitor the dollar.

    Over the last 100 years, gold's value has gone up 6.5 x in real terms, adjusted for inflation. In the last hundred years, the dollar has lost 92% of its real value.

    Thus during this span, the value of gold has increased 100x verses its competitor currency. The dollar price of an ounce of gold was $20 100 years ago and now it is close to $2000.

    The past 100 years have been a time of huge increases in wealth and stocks captured that. Is it possible for that wealth actually reverse? I think it is possible.

    If total real wealth actually reversed (and shuttering the global economy seems like the surest short-term bet to make total real wealth reverse) then gold really could outperform stocks also. Not because gold grows wealth but it preserves wealth as global wealth recedes. Talking about global wealth receding takes one far outside of modern history but when civilizations receded throughout history, of course their total wealth declined. In that environment I imagine gold would be only game in town. When you realize you can't hope to grow or even hold together what has been built, then gold is a way to avoid loss. For most, that is too sad to contemplate but this is a grown-up discussion.

    This is a dark way of thinking. But trees don't grow to the sky. The idea that civilization and wealth could really decline is bolstered by two more aspects:

    (1) Unbelievably dire demographic shifts wedded to the bell curve (think Murray) that only deep HBDers can grasp

    coupled to

    (2) The fact that technological society has climbed incredibly high and hence has very very far to fall

    For those two reasons, I thought civilizations was cresting and receding even before this. And now we have shuttered the economy and gone socialist.

    If civilization really does move significantly backwards then mere preservation of 2020 wealth is outstanding performance.

    A.E. what do you think about bitcoin? Would that be worth a separate thread? I am deep in the mode of how to hold wealth in a world that really becomes poorer... I have avoided crypto so far (didn't really know enough) but if it is future gold, I am interested. Is that possible?

    Bitcoin cons: Very short history; if tech recedes bitcoin isn't the future; governments could probably ban it

    Bitcoin pros: Young successful silicon valley types like it much more than gold and they are the most successful people right now

  93. @Achmed E. Newman
    A123, no, they will not have "Disconnect Day". What I can foresee is that a huge chunk of their customers will be behind by a huge amount (relatively to their normal bill) that they can't or won't pay. The power company will have a great excuse (maybe already has tried it) to get on that gravy train - there are plenty of hundreds of millions within 2 or more trillions to go around, folks! "The formerly LOCKED-DOWN folks can't pay - you must help us help them, Uncle Sugar! We'll keep just a little bit of it too, for all the admin. work, of course ..."

    As usual, the responsible ones in the middle class, I mean what's left of it, will get screwed. I'm not saying this is for sure what will happen, but this kind of thing will be increasingly likely, as we enter hardcore Socialism or whatever one might like to call it.

    What I can foresee is that a huge chunk of their customers will be behind by a huge amount (relatively to their normal bill) that they can’t or won’t pay. The power company will have a great excuse (maybe already has tried it) to get on that gravy train – there are plenty of hundreds of millions within 2 or more trillions to go around, folks! “The formerly LOCKED-DOWN folks can’t pay – you must help us help them, Uncle Sugar!

    OK, you’re probably right about that, but what’s your answer? If someone has been thrown out of work through no fault of their own due to the Corona Hysteria and can’t pay their electricity bill do we just let them freeze to death come winter?

    If you don’t like commie solutions then you have to come up with viable alternatives. That’s going to be the problem for the Economic Right in the wake of this crisis – if they can’t offer solutions then people will look to socialist solutions. Corona Hysteria has the potential to seriously discredit the Economic Right.

    • Replies: @Achmed E. Newman
    Well, first of all, I figure you know I am on hard on the anti-Panic side, per Mr. Hail's terminology ("Hysteria" works for me too.). The short-term solution is for people right now to start ignoring government LOCKDOWNS and telling the to fuck off. There's no right or left to that one, just respect for Authoritah in the midst of this Infotainment Panic-Fest, or common-sense and a good old American rebellious spirit.

    The long-term solution is to get governments at all levels to lay off with the regulations. That's why the people won't be able to get out of this so easily. Imagine if right now, parents felt comfortable (as in, they weren't sure they'd be shut down by some government agency within hours) starting small schools for the 1/2 days for the children who've been home a month or month and a half now. Can you imagine that? It's a very Libertarian concept that doesn't come easy, when the extreme regulatory environment we are under is so engrained in most of us.

    Now, think about that for a lot of small business. There are plenty of ways for people to make money, were governments, with the help of their Big-Biz cronies, to get the hell out of the way.
    , @Onebelowall

    ...what’s your answer? If someone has been thrown out of work through no fault of their own due to the Corona Hysteria and can’t pay their electricity bill do we just let them freeze to death come winter?
     
    It's pretty obvious we need more tax cuts and bailouts. :)
  94. @dfordoom

    What I can foresee is that a huge chunk of their customers will be behind by a huge amount (relatively to their normal bill) that they can’t or won’t pay. The power company will have a great excuse (maybe already has tried it) to get on that gravy train – there are plenty of hundreds of millions within 2 or more trillions to go around, folks! “The formerly LOCKED-DOWN folks can’t pay – you must help us help them, Uncle Sugar!
     
    OK, you're probably right about that, but what's your answer? If someone has been thrown out of work through no fault of their own due to the Corona Hysteria and can't pay their electricity bill do we just let them freeze to death come winter?

    If you don't like commie solutions then you have to come up with viable alternatives. That's going to be the problem for the Economic Right in the wake of this crisis - if they can't offer solutions then people will look to socialist solutions. Corona Hysteria has the potential to seriously discredit the Economic Right.

    Well, first of all, I figure you know I am on hard on the anti-Panic side, per Mr. Hail’s terminology (“Hysteria” works for me too.). The short-term solution is for people right now to start ignoring government LOCKDOWNS and telling the to fuck off. There’s no right or left to that one, just respect for Authoritah in the midst of this Infotainment Panic-Fest, or common-sense and a good old American rebellious spirit.

    The long-term solution is to get governments at all levels to lay off with the regulations. That’s why the people won’t be able to get out of this so easily. Imagine if right now, parents felt comfortable (as in, they weren’t sure they’d be shut down by some government agency within hours) starting small schools for the 1/2 days for the children who’ve been home a month or month and a half now. Can you imagine that? It’s a very Libertarian concept that doesn’t come easy, when the extreme regulatory environment we are under is so engrained in most of us.

    Now, think about that for a lot of small business. There are plenty of ways for people to make money, were governments, with the help of their Big-Biz cronies, to get the hell out of the way.

    • Replies: @dfordoom

    Well, first of all, I figure you know I am on hard on the anti-Panic side, per Mr. Hail’s terminology (“Hysteria” works for me too.).
     
    Yes, we're in total agreement about that.

    The short-term solution is for people right now to start ignoring government LOCKDOWNS and telling the to fuck off.
     
    I agree with that, although I suspect that governments are going to be increasingly willing to use force to compel us to comply.

    This is not just a panic. This is more and more a Moral Crusade. To the lockdown enthusiasts Corona Sceptics are Corona Deniers and they're not folks who disagree with them, they are bad evil people who may eventually need to be not just locked down but locked up. Corona Deniers are kinda like Global Warming Deniers and all right-thinking people agree that Global Warming Deniers should be locked up.

    It's going to get real interesting. What we don't know at the moment is just how ordinary people are going to respond. Do ordinary people actually buy the We're All Gonna Die line? Are ordinary people really onboard with completely wrecking the economy?

    It's fascinating to see the way people are dividing on this issue. All the Boomers I know are totally opposed to the lockdowns, and all the Millennials I know are in favour of them. I suspect it's because older people have lived through so many moral panics and so many We're All Gonna Die environmental panics and they've become very sceptical. But in the population at large we don't know how many people are inherent sceptics and how many people are inherently emotion-driven panickers.

    The long-term solution is to get governments at all levels to lay off with the regulations.
     
    Up to a point I agree with that as well. I'm not opposed to regulations as such but there are too many silly petty unnecessary regulations.

    I also agree with you about people starting small informal schools. Homeschooling is a problem - not everyone has the time or the ability to do it so small informal schools would be an attractive solution.
  95. @Achmed E. Newman
    Well, first of all, I figure you know I am on hard on the anti-Panic side, per Mr. Hail's terminology ("Hysteria" works for me too.). The short-term solution is for people right now to start ignoring government LOCKDOWNS and telling the to fuck off. There's no right or left to that one, just respect for Authoritah in the midst of this Infotainment Panic-Fest, or common-sense and a good old American rebellious spirit.

    The long-term solution is to get governments at all levels to lay off with the regulations. That's why the people won't be able to get out of this so easily. Imagine if right now, parents felt comfortable (as in, they weren't sure they'd be shut down by some government agency within hours) starting small schools for the 1/2 days for the children who've been home a month or month and a half now. Can you imagine that? It's a very Libertarian concept that doesn't come easy, when the extreme regulatory environment we are under is so engrained in most of us.

    Now, think about that for a lot of small business. There are plenty of ways for people to make money, were governments, with the help of their Big-Biz cronies, to get the hell out of the way.

    Well, first of all, I figure you know I am on hard on the anti-Panic side, per Mr. Hail’s terminology (“Hysteria” works for me too.).

    Yes, we’re in total agreement about that.

    The short-term solution is for people right now to start ignoring government LOCKDOWNS and telling the to fuck off.

    I agree with that, although I suspect that governments are going to be increasingly willing to use force to compel us to comply.

    This is not just a panic. This is more and more a Moral Crusade. To the lockdown enthusiasts Corona Sceptics are Corona Deniers and they’re not folks who disagree with them, they are bad evil people who may eventually need to be not just locked down but locked up. Corona Deniers are kinda like Global Warming Deniers and all right-thinking people agree that Global Warming Deniers should be locked up.

    It’s going to get real interesting. What we don’t know at the moment is just how ordinary people are going to respond. Do ordinary people actually buy the We’re All Gonna Die line? Are ordinary people really onboard with completely wrecking the economy?

    It’s fascinating to see the way people are dividing on this issue. All the Boomers I know are totally opposed to the lockdowns, and all the Millennials I know are in favour of them. I suspect it’s because older people have lived through so many moral panics and so many We’re All Gonna Die environmental panics and they’ve become very sceptical. But in the population at large we don’t know how many people are inherent sceptics and how many people are inherently emotion-driven panickers.

    The long-term solution is to get governments at all levels to lay off with the regulations.

    Up to a point I agree with that as well. I’m not opposed to regulations as such but there are too many silly petty unnecessary regulations.

    I also agree with you about people starting small informal schools. Homeschooling is a problem – not everyone has the time or the ability to do it so small informal schools would be an attractive solution.

    • Replies: @Intelligent Dasein

    All the Boomers I know are totally opposed to the lockdowns, and all the Millennials I know are in favour of them. 
     
    That sounds as if both groups correctly perceive therein the end of the status quo and are acting in their own best interests.
  96. @dfordoom

    Well, first of all, I figure you know I am on hard on the anti-Panic side, per Mr. Hail’s terminology (“Hysteria” works for me too.).
     
    Yes, we're in total agreement about that.

    The short-term solution is for people right now to start ignoring government LOCKDOWNS and telling the to fuck off.
     
    I agree with that, although I suspect that governments are going to be increasingly willing to use force to compel us to comply.

    This is not just a panic. This is more and more a Moral Crusade. To the lockdown enthusiasts Corona Sceptics are Corona Deniers and they're not folks who disagree with them, they are bad evil people who may eventually need to be not just locked down but locked up. Corona Deniers are kinda like Global Warming Deniers and all right-thinking people agree that Global Warming Deniers should be locked up.

    It's going to get real interesting. What we don't know at the moment is just how ordinary people are going to respond. Do ordinary people actually buy the We're All Gonna Die line? Are ordinary people really onboard with completely wrecking the economy?

    It's fascinating to see the way people are dividing on this issue. All the Boomers I know are totally opposed to the lockdowns, and all the Millennials I know are in favour of them. I suspect it's because older people have lived through so many moral panics and so many We're All Gonna Die environmental panics and they've become very sceptical. But in the population at large we don't know how many people are inherent sceptics and how many people are inherently emotion-driven panickers.

    The long-term solution is to get governments at all levels to lay off with the regulations.
     
    Up to a point I agree with that as well. I'm not opposed to regulations as such but there are too many silly petty unnecessary regulations.

    I also agree with you about people starting small informal schools. Homeschooling is a problem - not everyone has the time or the ability to do it so small informal schools would be an attractive solution.

    All the Boomers I know are totally opposed to the lockdowns, and all the Millennials I know are in favour of them. 

    That sounds as if both groups correctly perceive therein the end of the status quo and are acting in their own best interests.

    • Replies: @dfordoom


    All the Boomers I know are totally opposed to the lockdowns, and all the Millennials I know are in favour of them.
     
    That sounds as if both groups correctly perceive therein the end of the status quo and are acting in their own best interests.
     
    If Millennials think the end of the status quo will be in their best interests they're dumber than I thought.

    I guess there were lots of people in the Weimar Republic who thought the end of the status quo with Hitler coming to power was going to be really cool. Many ended up in Buchenwald. Lots of people in Russia in 1917 thought the end of the status quo was going to be awesome. They got to celebrate that awesomeness in the GULAGs. Maybe there were people in Rome in the fifth century AD who thought the end of the status quo was going to be just great. People in 1914 thought the coming war was going to be a healthy cleansing invigorating experience, but the Somme and Passchendaele turned out to be less fun than they expected.

    Hint: the end of the status quo usually means social chaos and bloodbaths, followed by decades of misery.

    Of course this is Unz Review, where fantasy rules.
  97. @Achmed E. Newman
    Yes, the $ is the world's reserve currency, but that CANNOT last with the way the Feral Gov't has been treating it. The US had a good reputation everywhere around the world at the end of the Cold War but has been blowing that goodwill AND blowing the trust in the dollar by "printing" like mad.

    The only way to save the Dollar is to kill the Dollar, with real Americans coming up with a Real Dollar. That Real Dollar would have to backed by something that no one can make more of for nothing, meaning gold.

    Ron Paul is right.

    Yes, the $ is the world’s reserve currency, but that CANNOT last with the way the Feral Gov’t has been treating it. The US had a good reputation everywhere around the world at the end of the Cold War but has been blowing that goodwill AND blowing the trust in the dollar by “printing” like mad.

    I agree wholeheartedly.

    BTW A.E.’s blog is quite good, and there are some good discussions on here.

    • Replies: @Achmed E. Newman
    Yes, Buzz, it's a nice change from iSteve's (till the last few days) fixation on all the details of all things Covid-one-niner. (Steve's come around the last few days, toward his normal self.) A.E., among his bar graph posts, has instigated some good discussions on what's more important than this virus Panic-Fest itself, the economic aftermath.

    I did happen to suggest this a few days back.
  98. @Audacious Epigone
    The physical utility of a federal reserve note is virtually nil--it's just a piece of paper. There is a huge premium placed on it, though, that is unrelated to its physical characteristics. There's no disagreement here.

    What you deem parasitic "money holders" many other deem "savers". The reason our liberties are being effortlessly taken away from us at the moment because there are vanishingly few said savers in the US. That's how they get away with putting a $1200 piece of cheese in the 1990s Russia-style 'relief bill' and having everyone eagerly sign on.

    As for my putative stoogery, I'm fortunate to have not listened to many who personally advised against exiting the equity markets nearly in full last summer after getting spooked by the repo freeze up and putting the majority of that into metals. I sidestepped a freight train.

    I’m fortunate to have not listened to many who personally advised against exiting the equity markets nearly in full last summer after getting spooked by the repo freeze up and putting the majority of that into metals.

    I did the same in August, 2019…but I have had gold for many years.

  99. @Audacious Epigone
    Spending is going to outstrip revenues by a lot more than 2x-3x this year. And next year, and the year after that. As for slowly backing itself into a corner, it's already there. It has been since at least late 2018, when a gentle move towards upping rates and unwinding the balance sheet crashed the stock market.

    Spending is going to outstrip revenues by a lot more than 2x-3x this year. And next year, and the year after that.

    That’s for sure.

  100. @Audacious Epigone
    If you think gold-backed currency will stabilize prices, think again.

    The question is relative to what? Discovering gold--which has a predictable cost associated with it--is fundamentally different than being able to create gold. Creating fiat currency has no comparable cost to gold mining.

    Re: inflation versus deflation, I feel as though my standard of living has been improved much more by the deflation in consumer electronics than it has been by the inflation in real estate (or healthcare or education).

    Creating fiat currency has no comparable cost to gold mining.

    You point is correct….but the cost of fiat money has yet to fully hit this country.

  101. @Buzz Mohawk

    Yes, the $ is the world’s reserve currency, but that CANNOT last with the way the Feral Gov’t has been treating it. The US had a good reputation everywhere around the world at the end of the Cold War but has been blowing that goodwill AND blowing the trust in the dollar by “printing” like mad.
     
    I agree wholeheartedly.

    BTW A.E.'s blog is quite good, and there are some good discussions on here.

    Yes, Buzz, it’s a nice change from iSteve’s (till the last few days) fixation on all the details of all things Covid-one-niner. (Steve’s come around the last few days, toward his normal self.) A.E., among his bar graph posts, has instigated some good discussions on what’s more important than this virus Panic-Fest itself, the economic aftermath.

    I did happen to suggest this a few days back.

  102. @Intelligent Dasein

    All the Boomers I know are totally opposed to the lockdowns, and all the Millennials I know are in favour of them. 
     
    That sounds as if both groups correctly perceive therein the end of the status quo and are acting in their own best interests.

    All the Boomers I know are totally opposed to the lockdowns, and all the Millennials I know are in favour of them.

    That sounds as if both groups correctly perceive therein the end of the status quo and are acting in their own best interests.

    If Millennials think the end of the status quo will be in their best interests they’re dumber than I thought.

    I guess there were lots of people in the Weimar Republic who thought the end of the status quo with Hitler coming to power was going to be really cool. Many ended up in Buchenwald. Lots of people in Russia in 1917 thought the end of the status quo was going to be awesome. They got to celebrate that awesomeness in the GULAGs. Maybe there were people in Rome in the fifth century AD who thought the end of the status quo was going to be just great. People in 1914 thought the coming war was going to be a healthy cleansing invigorating experience, but the Somme and Passchendaele turned out to be less fun than they expected.

    Hint: the end of the status quo usually means social chaos and bloodbaths, followed by decades of misery.

    Of course this is Unz Review, where fantasy rules.

    • Replies: @iffen
    We can't have a revolution without revolutionary conditions.
  103. @Elmer's Washable School Glue

    “Not any different than the dollar except that it is harder to create more gold than dollars.”

    that being the entire point. avoiding all the ‘new’ issues of paper fiat inflation, fraud, and a money parasite class. i’m moderately onboard with metal as money. it made more sense, was more honest, and it’s even in the Constitution.
     

    AE:

    Gold serves as a decent currency not because it is mostly useless, but because it can neither be created nor destroyed.
     
    Gold mines exist.

    You're both basing your argument on the idea that the supply of gold will not grow faster than the demand. And to your credit you're probably correct, although as other commentors have pointed out, there have been periods where big increases in gold production have caused catastrophic inflationary effects in gold-backed systems.

    Of course, there's a flip side: if demand grows faster than supply we will see *deflation*, which economists generally agree is worse than inflation, although I totally agree that the latter is bad as well.

    What we really want is for the demand of money to match supply. Then you have neither inflation or deflation. The idea that gold production, which historically has varied wildly, will somehow perfectly match the increase in T (e.g. money demand) is laughably absurd. And the fact that gold has non-monetary uses makes it even worse by further destabilizing demand (see my comment above).

    If you think gold-backed currency will stabilize prices, think again.

    *deflation*, which economists generally agree is worse than inflation

    That sounds like economists of the current currency regime grifting people.

    In theory, the problem with deflation is that people find it more valuable to hold onto their money than to invest it in new productive endeavors.

    I don’t buy that this would be a sustainable trend in the long term. There are always periods of short-term hoarding, but the need and desire for people to consume is literally wired into humanity. The man who gambles on a productive venture is very frequently going to come out way ahead of the man who sticks his gold under his mattress.

    Jesus wasn’t an economist, but he spoke very pointedly on the matter (yes, I know that the economics isn’t the point of the parable, but the assumptions surrounding the fact that he chose to present the parable in this fashion speak volumes):

    14 “For it is just like a man about to go on a journey, who called his own slaves and entrusted his possessions to them. 15 To one he gave five [a]talents, to another, two, and to another, one, each according to his own ability; and he went on his journey. 16 Immediately the one who had received the five talents went and traded with them, and gained five more talents. 17 In the same manner the one who had received the two talents gained two more. 18 But he who received the one talent went away, and dug a hole in the ground and hid his [b]master’s money.

    19 “Now after a long time the master of those slaves *came and *settled accounts with them. 20 The one who had received the five talents came up and brought five more talents, saying, ‘Master, you entrusted five talents to me. See, I have gained five more talents.’ 21 His master said to him, ‘Well done, good and faithful slave. You were faithful with a few things, I will put you in charge of many things; enter into the joy of your [c]master.’

    22 “Also the one who had received the two talents came up and said, ‘Master, you entrusted two talents to me. See, I have gained two more talents.’ 23 His master said to him, ‘Well done, good and faithful slave. You were faithful with a few things, I will put you in charge of many things; enter into the joy of your master.’

    24 “And the one also who had received the one talent came up and said, ‘Master, I knew you to be a hard man, reaping where you did not sow and gathering where you scattered no seed. 25 And I was afraid, and went away and hid your talent in the ground. See, you have what is yours.’

    26 “But his master answered and said to him, ‘You wicked, lazy slave, you knew that I reap where I did not sow and gather where I scattered no seed. 27 Then you ought to have put my money [d]in the bank, and on my arrival I would have received my money back with interest. 28 Therefore take away the talent from him, and give it to the one who has the ten talents.’

    • Replies: @Audacious Epigone
    Food is the response I hear to deflation = forever hoarding money most. It's accurate but suboptimal. No one making the argument is claiming people will starve to avoid spending money that is growing in value.

    Consumer electronics are a better example. The new smartphone you buy today will be a lot cheaper a year from now, but lots of people still buy it today.
  104. @advancedatheist
    Libertarians who advocate both the gold standard and the general cornucopianism of natural resources apparently don't see that these ideas make contradictory assumptions about Element 79 in the Periodic Table. What if some combination of technological breakthroughs turned gold into a throwaway commodity, like what has happened to aluminum over the last 200 years?

    Also gold depends on political construction to have "value." If our government refused to recognize gold as a form of property, and it didn't arrest and prosecute people who take anything made of gold without the original possessor's consent, then libertarians would see pretty quickly what their "sound money" amounts to.

    Gold and silver were chosen as money long before central banks or central governments. Therefore, it does not need government approval to have value. They are the true people’s money because the people chose them as money.

    If someone had lots of gold, the best thing to happen to them would be if the government made gold illegal to possess. Its value would sky rocket. Just because gold would be illegal wouldn’t mean people wouldn’t buy it like they buy any other illegal commodity.

    You are much like many of these writers on UNZ on Corona, they watch waay to much TV and believe far too much government bull shit to be any value.

    • Replies: @PiltdownMan

    If someone had lots of gold, the best thing to happen to them would be if the government made gold illegal to possess. Its value would sky rocket ...
     
    It happened in India, more than half a century ago.

    https://en.wikipedia.org/wiki/The_Gold_(Control)_Act,_1968


    Post-Independence, the foreign exchange drain was accentuated in 1962 during the border dispute with China. Morarji Desai, then finance minister, came out with Gold Control Act, 1962, which recalled all gold loans given by banks and banned forward trading in gold. In 1963, the production of gold jewellery above 14 carat fineness was banned. In 1965, a gold bond scheme was launched with tax immunity for unaccounted wealth. All these steps failed to yield the desired result.

    Desai finally introduced the Gold Control Act, on 24 August 1968, which prohibited citizens from owning gold in the form of bars and coins. All existing holding of gold coins and bars had to be converted to jewellery and declared to the authorities.

    Goldsmiths were not allowed to own more than 100 g of gold. Licensed dealers were not supposed to own more than 2 kg of gold, depending upon the number of artisans employed by them. They were banned from trading with each other.

    Desai believed that Indians would respond positively to these steps and stop consuming gold and help conserve precious foreign exchange. New gold jewellery purchases were either recycled or smuggled gold.

    This legislation killed the official gold market and a large unofficial market sprung up dealing in cash only. The gold was smuggled in and sold through the unofficial channel wherein, many jewellers and bullion traders traded in smuggled gold. A huge black market developed for gold.
     
  105. @Achmed E. Newman
    A123, no, they will not have "Disconnect Day". What I can foresee is that a huge chunk of their customers will be behind by a huge amount (relatively to their normal bill) that they can't or won't pay. The power company will have a great excuse (maybe already has tried it) to get on that gravy train - there are plenty of hundreds of millions within 2 or more trillions to go around, folks! "The formerly LOCKED-DOWN folks can't pay - you must help us help them, Uncle Sugar! We'll keep just a little bit of it too, for all the admin. work, of course ..."

    As usual, the responsible ones in the middle class, I mean what's left of it, will get screwed. I'm not saying this is for sure what will happen, but this kind of thing will be increasingly likely, as we enter hardcore Socialism or whatever one might like to call it.

    There are other more aggressive players looking for handouts.

    Tyson Foods springs to mind:

    PEACE 😷

    • Replies: @Achmed E. Newman
    See, here's the difference, A123. With these much more huge Big-Biz bailouts, small business gets screwed as usual. However, most of us are not small chicken farmers, as much as this latest going-on is making me want more land to have a few. It's simply all taxpayers that get screwed equally with this Tyson Food deal.

    When you have a partial bailout, only to those who are irresponsible, than that turns the responsible among us into suckers. Nobody likes being the sucker.
  106. Here is an inflation datapoint from my own Amazon history. There is one product I was ordering like clockwork over the last six months:

    Cascade complete Actionpacs Dishwasher Detergent, Fresh Scent, 78Count
    (This is the #1 best seller in the category of Dishwasher Detergent)

    ORDER PLACED October 4, 2019 $14.48

    ORDER PLACED November 15, 2019 $14.69

    ORDER PLACED December 31, 2019 $14.69

    ORDER PLACED Feb. 12th, 2020 $16.97

    ORDER PLACED March 21, 2020 $17.99

    Price as of 4/28/2020: $40.00 (I am not buying)

    I just substituted
    “Finish – All in 1 – 94ct – Dishwasher Detergent – Powerball – Dishwashing Tablets – Dish Tabs – Fresh Scent” = $14.35

    Which seems almost equivalent and 17% cheaper per dishwasher pack than what I was originally paying. What’s the lesson here? Well one lesson is that one should be looking always for substitutes because shortages can easily develop for individual products.

    I read about an Amazon inflation index.
    http://thewire.fiig.com.au/article/2017/06/20/introducing-the-amazon-inflation-index

    Is there a live version of an Amazon inflation calculator?

    • Replies: @Tusk
    I've seen basic products (milk, pasta) all go up 25% in the past few months, and it certainly won't come down.
  107. @Achmed E. Newman
    A123, no, they will not have "Disconnect Day". What I can foresee is that a huge chunk of their customers will be behind by a huge amount (relatively to their normal bill) that they can't or won't pay. The power company will have a great excuse (maybe already has tried it) to get on that gravy train - there are plenty of hundreds of millions within 2 or more trillions to go around, folks! "The formerly LOCKED-DOWN folks can't pay - you must help us help them, Uncle Sugar! We'll keep just a little bit of it too, for all the admin. work, of course ..."

    As usual, the responsible ones in the middle class, I mean what's left of it, will get screwed. I'm not saying this is for sure what will happen, but this kind of thing will be increasingly likely, as we enter hardcore Socialism or whatever one might like to call it.

    Nobody has to pay their damned power bills. All you have to do is be on welfare, and whitey pays for it.

    Haven’t you ever heard of LIHEAP?

    Low Income Home Energy Assistance Program (LIHEAP)

    • Agree: Achmed E. Newman
    • LOL: Cloudbuster
  108. @DanHessinMD
    Here is an inflation datapoint from my own Amazon history. There is one product I was ordering like clockwork over the last six months:

    Cascade complete Actionpacs Dishwasher Detergent, Fresh Scent, 78Count
    (This is the #1 best seller in the category of Dishwasher Detergent)

    ORDER PLACED October 4, 2019 $14.48

    ORDER PLACED November 15, 2019 $14.69

    ORDER PLACED December 31, 2019 $14.69

    ORDER PLACED Feb. 12th, 2020 $16.97

    ORDER PLACED March 21, 2020 $17.99

    Price as of 4/28/2020: $40.00 (I am not buying)

    I just substituted
    "Finish - All in 1 - 94ct - Dishwasher Detergent - Powerball - Dishwashing Tablets - Dish Tabs - Fresh Scent" = $14.35

    Which seems almost equivalent and 17% cheaper per dishwasher pack than what I was originally paying. What's the lesson here? Well one lesson is that one should be looking always for substitutes because shortages can easily develop for individual products.

    I read about an Amazon inflation index.
    http://thewire.fiig.com.au/article/2017/06/20/introducing-the-amazon-inflation-index

    Is there a live version of an Amazon inflation calculator?

    I’ve seen basic products (milk, pasta) all go up 25% in the past few months, and it certainly won’t come down.

    • Replies: @RadicalCenter
    We are still paying $2,99 per gallon for milk in downtown los angeles, though most stores charge more.

    Still paying max $1 per pound of pasta, though that has gotten harder to find and i sometimes forgo buying pasta till i can find that price (sometimes online). Many people are apparently paying $1.49 to $2 per pound of pasta.
  109. @Elmer's Washable School Glue
    Gold is not steady in supply. It has relatively little intrinsic value, which is why it is superior to land or oil, but still some which further destabilizes its price compared to paper.

    Don't believe me? Here's a chart of US inflation rates 1914 to 2012: https://tradingeconomics.com/united-states/inflation-cpi

    Clearly, the gold era had far more volatility than the fiat era. We had peak inflation rates over 20% and deflation nearing 15% at times.

    If the price of money should not go up or down, we need to abolish the Fed, because interest rates are the price of money.
     
    Interest rates existed before the Fed was created, and would continue to exist if it was abolished. I'm not a huge fan of the Fed's monetary policy all the time, but overall, it has probably had a stabilizing effect.

    Re: inflation versus deflation, I feel as though my standard of living has been improved much more by the deflation in consumer electronics than it has been by the inflation in real estate (or healthcare or education).
     
    Money is perfectly fungible. Its price cannot inflate for some products while deflating for others. The reason electronics have seen price decreases is because the real value of the goods going into them has decreased. Ditto for skyrocketing college costs, even if most of those expenses are on useless administrators, they're still increasing real costs.

    Actual currency deflation has disastrous consequences for debt-using economies, leading to mass bankruptcies as people can't pay back the nominal value of their loans, the real value of which is constantly going up.

    ---

    I get your concern about fiat money having the potential for uncontrolled supply growth. It does have that potential. Basically, you need a government with some small degree of monetary discipline for fiat money to work, but when it does work, it is far, far superior to gold. Historically, the US and most other central banks have managed to do so. I'll concede that maybe Zimbabwe and Venezuela would be better off using gold. But unless you think this bailout is gonna put US inflation above 20%--and I'll take that bet in a heartbeat--gold is going to remain much more volatile than dollars. You need *gross* incompetence to perform as badly as gold does.

    “You need *gross* incompetence to perform as badly as gold does.”

    This is massively moving the goalposts. I presume you are comparing gold against stocks.

    The post is about gold as currency. For consistency, you would have to compare gold against its competitor the dollar.

    Over the last 100 years, gold’s value has gone up 6.5 x in real terms, adjusted for inflation. In the last hundred years, the dollar has lost 92% of its real value.

    Thus during this span, the value of gold has increased 100x verses its competitor currency. The dollar price of an ounce of gold was $20 100 years ago and now it is close to $2000.

    The past 100 years have been a time of huge increases in wealth and stocks captured that. Is it possible for that wealth actually reverse? I think it is possible.

    If total real wealth actually reversed (and shuttering the global economy seems like the surest short-term bet to make total real wealth reverse) then gold really could outperform stocks also. Not because gold grows wealth but it preserves wealth as global wealth recedes. Talking about global wealth receding takes one far outside of modern history but when civilizations receded throughout history, of course their total wealth declined. In that environment I imagine gold would be only game in town. When you realize you can’t hope to grow or even hold together what has been built, then gold is a way to avoid loss. For most, that is too sad to contemplate but this is a grown-up discussion.

    This is a dark way of thinking. But trees don’t grow to the sky. The idea that civilization and wealth could really decline is bolstered by two more aspects:

    (1) Unbelievably dire demographic shifts wedded to the bell curve (think Murray) that only deep HBDers can grasp

    coupled to

    (2) The fact that technological society has climbed incredibly high and hence has very very far to fall

    For those two reasons, I thought civilizations was cresting and receding even before this. And now we have shuttered the economy and gone socialist.

    If civilization really does move significantly backwards then mere preservation of 2020 wealth is outstanding performance.

    A.E. what do you think about bitcoin? Would that be worth a separate thread? I am deep in the mode of how to hold wealth in a world that really becomes poorer… I have avoided crypto so far (didn’t really know enough) but if it is future gold, I am interested. Is that possible?

    Bitcoin cons: Very short history; if tech recedes bitcoin isn’t the future; governments could probably ban it

    Bitcoin pros: Young successful silicon valley types like it much more than gold and they are the most successful people right now

    • Replies: @Audacious Epigone
    I'm very intrigued by the idea. My biggest hangup is the one I brought up with Mr. Rational in comment #90. I'm not sure how to avoid getting left holding the bag unless I'm able to stay on the cutting edge of crypto technology, something I'm unequipped to do.
  110. @A123
    There are other more aggressive players looking for handouts.

    Tyson Foods springs to mind:

    https://twitter.com/TheCounter/status/1254869252764585984?s=20

    PEACE 😷

    See, here’s the difference, A123. With these much more huge Big-Biz bailouts, small business gets screwed as usual. However, most of us are not small chicken farmers, as much as this latest going-on is making me want more land to have a few. It’s simply all taxpayers that get screwed equally with this Tyson Food deal.

    When you have a partial bailout, only to those who are irresponsible, than that turns the responsible among us into suckers. Nobody likes being the sucker.

  111. @Cloudbuster
    *deflation*, which economists generally agree is worse than inflation

    That sounds like economists of the current currency regime grifting people.

    In theory, the problem with deflation is that people find it more valuable to hold onto their money than to invest it in new productive endeavors.

    I don't buy that this would be a sustainable trend in the long term. There are always periods of short-term hoarding, but the need and desire for people to consume is literally wired into humanity. The man who gambles on a productive venture is very frequently going to come out way ahead of the man who sticks his gold under his mattress.

    Jesus wasn't an economist, but he spoke very pointedly on the matter (yes, I know that the economics isn't the point of the parable, but the assumptions surrounding the fact that he chose to present the parable in this fashion speak volumes):

    14 “For it is just like a man about to go on a journey, who called his own slaves and entrusted his possessions to them. 15 To one he gave five [a]talents, to another, two, and to another, one, each according to his own ability; and he went on his journey. 16 Immediately the one who had received the five talents went and traded with them, and gained five more talents. 17 In the same manner the one who had received the two talents gained two more. 18 But he who received the one talent went away, and dug a hole in the ground and hid his [b]master’s money.

    19 “Now after a long time the master of those slaves *came and *settled accounts with them. 20 The one who had received the five talents came up and brought five more talents, saying, ‘Master, you entrusted five talents to me. See, I have gained five more talents.’ 21 His master said to him, ‘Well done, good and faithful slave. You were faithful with a few things, I will put you in charge of many things; enter into the joy of your [c]master.’

    22 “Also the one who had received the two talents came up and said, ‘Master, you entrusted two talents to me. See, I have gained two more talents.’ 23 His master said to him, ‘Well done, good and faithful slave. You were faithful with a few things, I will put you in charge of many things; enter into the joy of your master.’

    24 “And the one also who had received the one talent came up and said, ‘Master, I knew you to be a hard man, reaping where you did not sow and gathering where you scattered no seed. 25 And I was afraid, and went away and hid your talent in the ground. See, you have what is yours.’

    26 “But his master answered and said to him, ‘You wicked, lazy slave, you knew that I reap where I did not sow and gather where I scattered no seed. 27 Then you ought to have put my money [d]in the bank, and on my arrival I would have received my money back with interest. 28 Therefore take away the talent from him, and give it to the one who has the ten talents.’
     

    Food is the response I hear to deflation = forever hoarding money most. It’s accurate but suboptimal. No one making the argument is claiming people will starve to avoid spending money that is growing in value.

    Consumer electronics are a better example. The new smartphone you buy today will be a lot cheaper a year from now, but lots of people still buy it today.

  112. @DanHessinMD
    "You need *gross* incompetence to perform as badly as gold does."

    This is massively moving the goalposts. I presume you are comparing gold against stocks.

    The post is about gold as currency. For consistency, you would have to compare gold against its competitor the dollar.

    Over the last 100 years, gold's value has gone up 6.5 x in real terms, adjusted for inflation. In the last hundred years, the dollar has lost 92% of its real value.

    Thus during this span, the value of gold has increased 100x verses its competitor currency. The dollar price of an ounce of gold was $20 100 years ago and now it is close to $2000.

    The past 100 years have been a time of huge increases in wealth and stocks captured that. Is it possible for that wealth actually reverse? I think it is possible.

    If total real wealth actually reversed (and shuttering the global economy seems like the surest short-term bet to make total real wealth reverse) then gold really could outperform stocks also. Not because gold grows wealth but it preserves wealth as global wealth recedes. Talking about global wealth receding takes one far outside of modern history but when civilizations receded throughout history, of course their total wealth declined. In that environment I imagine gold would be only game in town. When you realize you can't hope to grow or even hold together what has been built, then gold is a way to avoid loss. For most, that is too sad to contemplate but this is a grown-up discussion.

    This is a dark way of thinking. But trees don't grow to the sky. The idea that civilization and wealth could really decline is bolstered by two more aspects:

    (1) Unbelievably dire demographic shifts wedded to the bell curve (think Murray) that only deep HBDers can grasp

    coupled to

    (2) The fact that technological society has climbed incredibly high and hence has very very far to fall

    For those two reasons, I thought civilizations was cresting and receding even before this. And now we have shuttered the economy and gone socialist.

    If civilization really does move significantly backwards then mere preservation of 2020 wealth is outstanding performance.

    A.E. what do you think about bitcoin? Would that be worth a separate thread? I am deep in the mode of how to hold wealth in a world that really becomes poorer... I have avoided crypto so far (didn't really know enough) but if it is future gold, I am interested. Is that possible?

    Bitcoin cons: Very short history; if tech recedes bitcoin isn't the future; governments could probably ban it

    Bitcoin pros: Young successful silicon valley types like it much more than gold and they are the most successful people right now

    I’m very intrigued by the idea. My biggest hangup is the one I brought up with Mr. Rational in comment #90. I’m not sure how to avoid getting left holding the bag unless I’m able to stay on the cutting edge of crypto technology, something I’m unequipped to do.

  113. What will gold be in 50 years?

    https://www.rt.com/business/462703-golden-asteroid-everyone-billionaire/

    Whether it was the Big Bang, Midas or God himself, we don’t really need to unlock the mystery of the origins of gold when we’ve already identified an asteroid worth $700 quintillion in precious heavy metals.

    If anything launches this metals mining space race, it will be this asteroid–Psyche 16, taking up residence between Mars and Jupiter and carrying around enough heavy metals to net every single person on the planet close to a trillion dollars.

  114. @Daniel H
    What I would like to see come out of this would be to force manufactures to clearly place a big stamp on the item where a product was produced.

    1) Products sold in the USA already have to indicate country of origin.

    2) To the American consumer, wouldn't make a damn bit of difference. The American has little sense of national solidarity. Every man/woman in this country is out for themselves. Pay a little more so that manufacturing could be done in America? Hell no. Get outta' my way. I want it cheap. We can only achieve industrial production in the USA if it is mandated by law. We must end free trade as national policy. Forcing consumers to pay more must be done through the mandate of law.

    To the American consumer, wouldn’t make a damn bit of difference.

    You’re not going to get consumers to subsidize an overpaid (compared to the rest of the country) manufacturing sector. You have to have a semblance of economic equality to get them to do that. Why should a waitress barely making it on a third of a factory worker’s salary pay premium to keep him in a job?

    I suspect UBI would alleviate this problem. People who know they’ll have a source of income bo matter what are going to be less likely to pinch pennies o the detriment of their compatriots, I would assume.

    • Replies: @dfordoom

    You’re not going to get consumers to subsidize an overpaid (compared to the rest of the country) manufacturing sector. You have to have a semblance of economic equality to get them to do that. Why should a waitress barely making it on a third of a factory worker’s salary pay premium to keep him in a job?
     
    Yep. It's wildly unrealistic to expect people who are just getting by to be happy about paying much higher prices for consumer goods. Why the hell should they be happy about it? Any politician who triers to force them to do so is just cutting his own political throat. And appealing to patriotism won't work in a society in which those who are struggling know that there are people who are absolutely wallowing in money. Expecting those on the bottom of the heap to make all the sacrifices (once again) is just going to make those people angry, disillusioned and resentful, and justifiably so.

    Those who think that rebuilding manufacturing industry is going to be fairly simple are wildly underestimating the difficulties and the cost, and wildly overestimating the willingness of ordinary people who have already suffered hardships due to the lockdowns to endure even more hardships.

    Once this crisis is over I think you'll find that the overwhelming majority of people will be looking forward to a return to normality. They won't be keen on the prospect of looking forward to a future of sharply reduced living standards and long-term financial misery.

    I suspect that in a few months' time the talk of bringing manufacturing industry back will be quietly dropped as an unrealistic pipe-dream.
  115. @dfordoom

    What I can foresee is that a huge chunk of their customers will be behind by a huge amount (relatively to their normal bill) that they can’t or won’t pay. The power company will have a great excuse (maybe already has tried it) to get on that gravy train – there are plenty of hundreds of millions within 2 or more trillions to go around, folks! “The formerly LOCKED-DOWN folks can’t pay – you must help us help them, Uncle Sugar!
     
    OK, you're probably right about that, but what's your answer? If someone has been thrown out of work through no fault of their own due to the Corona Hysteria and can't pay their electricity bill do we just let them freeze to death come winter?

    If you don't like commie solutions then you have to come up with viable alternatives. That's going to be the problem for the Economic Right in the wake of this crisis - if they can't offer solutions then people will look to socialist solutions. Corona Hysteria has the potential to seriously discredit the Economic Right.

    …what’s your answer? If someone has been thrown out of work through no fault of their own due to the Corona Hysteria and can’t pay their electricity bill do we just let them freeze to death come winter?

    It’s pretty obvious we need more tax cuts and bailouts. 🙂

  116. @Rosie

    To the American consumer, wouldn’t make a damn bit of difference.
     
    You're not going to get consumers to subsidize an overpaid (compared to the rest of the country) manufacturing sector. You have to have a semblance of economic equality to get them to do that. Why should a waitress barely making it on a third of a factory worker's salary pay premium to keep him in a job?

    I suspect UBI would alleviate this problem. People who know they'll have a source of income bo matter what are going to be less likely to pinch pennies o the detriment of their compatriots, I would assume.

    You’re not going to get consumers to subsidize an overpaid (compared to the rest of the country) manufacturing sector. You have to have a semblance of economic equality to get them to do that. Why should a waitress barely making it on a third of a factory worker’s salary pay premium to keep him in a job?

    Yep. It’s wildly unrealistic to expect people who are just getting by to be happy about paying much higher prices for consumer goods. Why the hell should they be happy about it? Any politician who triers to force them to do so is just cutting his own political throat. And appealing to patriotism won’t work in a society in which those who are struggling know that there are people who are absolutely wallowing in money. Expecting those on the bottom of the heap to make all the sacrifices (once again) is just going to make those people angry, disillusioned and resentful, and justifiably so.

    Those who think that rebuilding manufacturing industry is going to be fairly simple are wildly underestimating the difficulties and the cost, and wildly overestimating the willingness of ordinary people who have already suffered hardships due to the lockdowns to endure even more hardships.

    Once this crisis is over I think you’ll find that the overwhelming majority of people will be looking forward to a return to normality. They won’t be keen on the prospect of looking forward to a future of sharply reduced living standards and long-term financial misery.

    I suspect that in a few months’ time the talk of bringing manufacturing industry back will be quietly dropped as an unrealistic pipe-dream.

    • Replies: @Rosie

    I suspect that in a few months’ time the talk of bringing manufacturing industry back will be quietly dropped as an unrealistic pipe-dream.
     
    I hope you're not right about that. As I said, I don't think bringing back manufacturing is necessarily a pipe dream, only that you can't do it in isolation from other socialist policies.

    You either have national solidarity or you don't. You can't pick and choose.

    UBI and universal healthcare would solve the problem, I think.
  117. @dfordoom


    All the Boomers I know are totally opposed to the lockdowns, and all the Millennials I know are in favour of them.
     
    That sounds as if both groups correctly perceive therein the end of the status quo and are acting in their own best interests.
     
    If Millennials think the end of the status quo will be in their best interests they're dumber than I thought.

    I guess there were lots of people in the Weimar Republic who thought the end of the status quo with Hitler coming to power was going to be really cool. Many ended up in Buchenwald. Lots of people in Russia in 1917 thought the end of the status quo was going to be awesome. They got to celebrate that awesomeness in the GULAGs. Maybe there were people in Rome in the fifth century AD who thought the end of the status quo was going to be just great. People in 1914 thought the coming war was going to be a healthy cleansing invigorating experience, but the Somme and Passchendaele turned out to be less fun than they expected.

    Hint: the end of the status quo usually means social chaos and bloodbaths, followed by decades of misery.

    Of course this is Unz Review, where fantasy rules.

    We can’t have a revolution without revolutionary conditions.

  118. @dfordoom

    You’re not going to get consumers to subsidize an overpaid (compared to the rest of the country) manufacturing sector. You have to have a semblance of economic equality to get them to do that. Why should a waitress barely making it on a third of a factory worker’s salary pay premium to keep him in a job?
     
    Yep. It's wildly unrealistic to expect people who are just getting by to be happy about paying much higher prices for consumer goods. Why the hell should they be happy about it? Any politician who triers to force them to do so is just cutting his own political throat. And appealing to patriotism won't work in a society in which those who are struggling know that there are people who are absolutely wallowing in money. Expecting those on the bottom of the heap to make all the sacrifices (once again) is just going to make those people angry, disillusioned and resentful, and justifiably so.

    Those who think that rebuilding manufacturing industry is going to be fairly simple are wildly underestimating the difficulties and the cost, and wildly overestimating the willingness of ordinary people who have already suffered hardships due to the lockdowns to endure even more hardships.

    Once this crisis is over I think you'll find that the overwhelming majority of people will be looking forward to a return to normality. They won't be keen on the prospect of looking forward to a future of sharply reduced living standards and long-term financial misery.

    I suspect that in a few months' time the talk of bringing manufacturing industry back will be quietly dropped as an unrealistic pipe-dream.

    I suspect that in a few months’ time the talk of bringing manufacturing industry back will be quietly dropped as an unrealistic pipe-dream.

    I hope you’re not right about that. As I said, I don’t think bringing back manufacturing is necessarily a pipe dream, only that you can’t do it in isolation from other socialist policies.

    You either have national solidarity or you don’t. You can’t pick and choose.

    UBI and universal healthcare would solve the problem, I think.

    • Agree: iffen, AaronB
    • Replies: @A123

    I don’t think bringing back manufacturing is necessarily a pipe dream, only that you can’t do it in isolation from other socialist policies.
     
    Bringing back manufacturing is about Populism, not Socialism. The keys are:

    -- Mandating "Buy American" for raw materials and products essential to National Security.
    -- Eliminating distortions that SJW Globalists have created in international trade via organizations like WTO.
    -- Ensuring that U.S. workers have the necessary math and language skills. This urgently requires the elimination of the failed Common Core curriculum.
    -- Preventing firms undercutting U.S. Workers via a broken immigration policy.

    PEACE 😷
    , @dfordoom


    I suspect that in a few months’ time the talk of bringing manufacturing industry back will be quietly dropped as an unrealistic pipe-dream.
     
    I hope you’re not right about that.
     
    There'll be lots of big talk from Trump about bringing back manufacturing. Once he's re-elected he'll drop the whole issue. The whole thing is an election ploy (like Trump's desperate attempts to blame China for his own blunders). There'll be lots of big talk from the GOP on the subject. There are lots of Republican congressmen and senators very nervous about losing their seats in November.

    Once the election is over, whoever wins, the issue will never be mentioned again. Politicians don't like tackling really hard really complex problems that have the potential to backfire on them. And they don't like tackling problems that might upset powerful interest groups. Bringing back manufacturing would in practice be the kind of nightmarishly difficult problem that politicians never ever tackle.

    The whole "let's make the evil Chinese pay" thing will also be quietly dropped after the election.

    And once the election is over stand by for the Republicans and Trump to switch to "we need massive increases in immigration to get the economy moving again."
  119. @Rosie

    I suspect that in a few months’ time the talk of bringing manufacturing industry back will be quietly dropped as an unrealistic pipe-dream.
     
    I hope you're not right about that. As I said, I don't think bringing back manufacturing is necessarily a pipe dream, only that you can't do it in isolation from other socialist policies.

    You either have national solidarity or you don't. You can't pick and choose.

    UBI and universal healthcare would solve the problem, I think.

    I don’t think bringing back manufacturing is necessarily a pipe dream, only that you can’t do it in isolation from other socialist policies.

    Bringing back manufacturing is about Populism, not Socialism. The keys are:

    — Mandating “Buy American” for raw materials and products essential to National Security.
    — Eliminating distortions that SJW Globalists have created in international trade via organizations like WTO.
    — Ensuring that U.S. workers have the necessary math and language skills. This urgently requires the elimination of the failed Common Core curriculum.
    — Preventing firms undercutting U.S. Workers via a broken immigration policy.

    PEACE 😷

    • Replies: @Rosie

    Bringing back manufacturing is about Populism, not Socialism.
     
    https://image.shutterstock.com/image-vector/hand-drawn-female-hands-w-260nw-1054445126.jpg

    This urgently requires the elimination of the failed Common Core curriculum.
     
    Don't even get me started. The only thing wrong with common core is that it is, essentially, a gifted program. It doesn't work for average students, and if you're not willing to separate gifted students, you can't use it at all.
    , @obwandiyag
    No it isn't. It's socialism. The government controls the businesses, forcing them to come home. That's socialism. Capitalism is let businesses be free to go where they want and do what they want. Populism is, what? I don't know, hang them all from the lampposts? I kinda like that idea.
  120. @Rosie

    I suspect that in a few months’ time the talk of bringing manufacturing industry back will be quietly dropped as an unrealistic pipe-dream.
     
    I hope you're not right about that. As I said, I don't think bringing back manufacturing is necessarily a pipe dream, only that you can't do it in isolation from other socialist policies.

    You either have national solidarity or you don't. You can't pick and choose.

    UBI and universal healthcare would solve the problem, I think.

    I suspect that in a few months’ time the talk of bringing manufacturing industry back will be quietly dropped as an unrealistic pipe-dream.

    I hope you’re not right about that.

    There’ll be lots of big talk from Trump about bringing back manufacturing. Once he’s re-elected he’ll drop the whole issue. The whole thing is an election ploy (like Trump’s desperate attempts to blame China for his own blunders). There’ll be lots of big talk from the GOP on the subject. There are lots of Republican congressmen and senators very nervous about losing their seats in November.

    Once the election is over, whoever wins, the issue will never be mentioned again. Politicians don’t like tackling really hard really complex problems that have the potential to backfire on them. And they don’t like tackling problems that might upset powerful interest groups. Bringing back manufacturing would in practice be the kind of nightmarishly difficult problem that politicians never ever tackle.

    The whole “let’s make the evil Chinese pay” thing will also be quietly dropped after the election.

    And once the election is over stand by for the Republicans and Trump to switch to “we need massive increases in immigration to get the economy moving again.”

    • Replies: @Rosie

    Politicians don’t like tackling really hard really complex problems that have the potential to backfire on them. And they don’t like tackling problems that might upset powerful interest groups. Bringing back manufacturing would in practice be the kind of nightmarishly difficult problem that politicians never ever tackle.
     
    Sad, but true.

    Some blame democracy, but I think that is a mistake. Good leaders of real nations with a sense of shared destiny can get people to make personal sacrifices for the common good that are simply inconceivable in an imperial polyglot like these here You Knighted States of America.
    , @Audacious Epigone
    No politician wants to be argue for an increase in consumer prices in return for some policy goal like more domestic manufacturing. But it's not going to matter because higher consumer prices are coming anyway. It's unavoidable at this point.

    I think making China pay is definitely on the table because of the massive amount of US debt that China holds. The US Treasury can default on that debt on the pretense of making China pay. Once consumer prices really start going up, people are going to support reducing the amount of the federal budget that goes to Chinese holders of treasuries.

    One consequence of this will be a sharp decrease in Chinese exports to the US, both by way of Chinese political retaliation and also a weakened dollar. That will create an environment more conducive to domestic manufacturing.

    It's going to painful to get there, but I actually think we will both sever our economic relationship with China in a substantial way and manufacture more things domestically over the next decade or so.

  121. Rosie says:
    April 29, 2020 at 1:27 pm GMT • 100 Words

    • Agree: iffen, AaronB

    The end is nigh.

    • Replies: @RadicalCenter
    i will note my agreement with Rosie as well. The end could be mere minutes away now.
  122. @dfordoom

    To return manufacturing to America, to create better quality jobs, to lessen income inequality, it would be worth it that the consumer pays a little more.
     
    The consumer might not agree.

    What surprises me these days is to see so many people on the Right embracing statist authoritarian solutions. I see right-wingers arguing that if consumers don't want to pay higher prices we'll just get the government to force them to do so. In fact the far right seems to be getting more and more authoritarian in outlook.

    It's also amusing to see people on the Right embracing the idea of central economic planning. Maybe we need a Five Year Plan to increase manufacturing. Lenin and Stalin, wherever they might be now, must be having a good old chortle about this. Or maybe we need a Great Leap Forward.

    It seems you have confused right wing with libertarian in outlook. While this became more and more the case in the US after WWII and especially post-Civil Rights era, it is not something inherent to the right. In fact, you could make an argument that libertarian perspectives were memed into the right wing at first to counter communism, then later counter the Civil Rights era through implicit rather than explicit means.

    Many liberty-centric positions are in fact not right wing at all.

    • Agree: Rosie
  123. @A123

    I don’t think bringing back manufacturing is necessarily a pipe dream, only that you can’t do it in isolation from other socialist policies.
     
    Bringing back manufacturing is about Populism, not Socialism. The keys are:

    -- Mandating "Buy American" for raw materials and products essential to National Security.
    -- Eliminating distortions that SJW Globalists have created in international trade via organizations like WTO.
    -- Ensuring that U.S. workers have the necessary math and language skills. This urgently requires the elimination of the failed Common Core curriculum.
    -- Preventing firms undercutting U.S. Workers via a broken immigration policy.

    PEACE 😷

    Bringing back manufacturing is about Populism, not Socialism.

    This urgently requires the elimination of the failed Common Core curriculum.

    Don’t even get me started. The only thing wrong with common core is that it is, essentially, a gifted program. It doesn’t work for average students, and if you’re not willing to separate gifted students, you can’t use it at all.

    • Replies: @Mr. Rational

    The only thing wrong with common core is that it is, essentially, a gifted program.
     
    Funny, what little I know about it says that it's a program for morons.  For instance, Common Core "math" instruction teaches multiplication by drawing and counting rectangles of dots ("stacking", the normal method of multiplication, is strongly condemned).  I've read that this is the method used in Haiti, drilling things into literal morons.
  124. @dfordoom


    I suspect that in a few months’ time the talk of bringing manufacturing industry back will be quietly dropped as an unrealistic pipe-dream.
     
    I hope you’re not right about that.
     
    There'll be lots of big talk from Trump about bringing back manufacturing. Once he's re-elected he'll drop the whole issue. The whole thing is an election ploy (like Trump's desperate attempts to blame China for his own blunders). There'll be lots of big talk from the GOP on the subject. There are lots of Republican congressmen and senators very nervous about losing their seats in November.

    Once the election is over, whoever wins, the issue will never be mentioned again. Politicians don't like tackling really hard really complex problems that have the potential to backfire on them. And they don't like tackling problems that might upset powerful interest groups. Bringing back manufacturing would in practice be the kind of nightmarishly difficult problem that politicians never ever tackle.

    The whole "let's make the evil Chinese pay" thing will also be quietly dropped after the election.

    And once the election is over stand by for the Republicans and Trump to switch to "we need massive increases in immigration to get the economy moving again."

    Politicians don’t like tackling really hard really complex problems that have the potential to backfire on them. And they don’t like tackling problems that might upset powerful interest groups. Bringing back manufacturing would in practice be the kind of nightmarishly difficult problem that politicians never ever tackle.

    Sad, but true.

    Some blame democracy, but I think that is a mistake. Good leaders of real nations with a sense of shared destiny can get people to make personal sacrifices for the common good that are simply inconceivable in an imperial polyglot like these here You Knighted States of America.

  125. @A123

    I don’t think bringing back manufacturing is necessarily a pipe dream, only that you can’t do it in isolation from other socialist policies.
     
    Bringing back manufacturing is about Populism, not Socialism. The keys are:

    -- Mandating "Buy American" for raw materials and products essential to National Security.
    -- Eliminating distortions that SJW Globalists have created in international trade via organizations like WTO.
    -- Ensuring that U.S. workers have the necessary math and language skills. This urgently requires the elimination of the failed Common Core curriculum.
    -- Preventing firms undercutting U.S. Workers via a broken immigration policy.

    PEACE 😷

    No it isn’t. It’s socialism. The government controls the businesses, forcing them to come home. That’s socialism. Capitalism is let businesses be free to go where they want and do what they want. Populism is, what? I don’t know, hang them all from the lampposts? I kinda like that idea.

    • Replies: @A123
    Socialism/Communism is government owning & directing civilian production & firms. It is the pinnacle of Authoritarian government systems. Remember, you cannot have National Socialism without Socialism.
    _____

    Populism is government protecting citizens and civilian companies from predators such as:
    -- Elite SJW Globalist MegaCorporations
    -- Hostile foreign governments, especially those with captive State Owned Enterprises (e.g. China)

    Part of protecting citizens from foreign exploitation is ensuring that essential goods are produced locally to guarantee they are available during a crisis. For example, the U.S. Government makes capitalist market purchases of U.S. produced oil and holds that essential material in the Strategic Petroleum Reserve [SPR].

    PEACE 😷
  126. @Achmed E. Newman
    Yes, the $ is the world's reserve currency, but that CANNOT last with the way the Feral Gov't has been treating it. The US had a good reputation everywhere around the world at the end of the Cold War but has been blowing that goodwill AND blowing the trust in the dollar by "printing" like mad.

    The only way to save the Dollar is to kill the Dollar, with real Americans coming up with a Real Dollar. That Real Dollar would have to backed by something that no one can make more of for nothing, meaning gold.

    Ron Paul is right.

    the $ is the world’s reserve currency, but that CANNOT last

    All part of the plan…

    • Agree: Achmed E. Newman
    • Thanks: Mark G., Audacious Epigone
    • Replies: @Achmed E. Newman
    I put an AGREE in, because I've see this graph before, and it's enlightening. The thing I don't agree with is that it's planned, Adam. I think all of these empires that had their currencies used as the reserve around the world eventually tried to exist on reputation of past might and economic power, when it was all fading away. Without their going to a sound currency to reset the whole system (involving a lot of financial pain, but it'd be coming anyway), the world always realizes this and bails out. That happens slowly at first, then quickly.

    We've had a pretty long run, haven't we? It could have been much longer but for the sick Socialists FDR, LBJ, and then Nixon too, taking us off of sound money.
    , @Mark G.
    Do you think there was something that coincided with each country losing its status as the possessor of the global reserve currency? I really don't know for sure. The only thing I can think of is that all these countries your chart shows got involved in prolonged wars that required maintaining a large expensive military. Spain had the Thirty Years war, The Dutch had wars against Louis XIV, France had the Napoleonic wars, Britain had World War I and the U.S. had the wars in the Mideast from 1990 up to the present. It might be a good idea to follow a less interventionist foreign policy if at all possible and keep overall government spending down, especially the military part of it.
    , @res
    Thanks. It looks like this page is the original source and it has a good bit more discussion.
    https://www.aier.org/article/u-s-dollar-supremacy-could-quickly-fade/

    It's interesting that that article is from 2019, while here is a very similar graphic from a 2015 blog post:
    http://blog.zorangagic.com/2015/10/global-reserve-currencies-since-1450.html
    That post has an image which makes a provocative juxtaposition with yours.

    http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2014/09/20140912_USANo2_0.jpg

    But this page indicates that in 2017 the US was 24.3% of world GDP with China at 14.8%.
    https://foreignpolicy.com/2017/02/24/infographic-heres-how-the-global-gdp-is-divvied-up/

    https://foreignpolicy.com/wp-content/uploads/2017/02/world-gdp-41ff.png
  127. @obwandiyag
    No it isn't. It's socialism. The government controls the businesses, forcing them to come home. That's socialism. Capitalism is let businesses be free to go where they want and do what they want. Populism is, what? I don't know, hang them all from the lampposts? I kinda like that idea.

    Socialism/Communism is government owning & directing civilian production & firms. It is the pinnacle of Authoritarian government systems. Remember, you cannot have National Socialism without Socialism.
    _____

    Populism is government protecting citizens and civilian companies from predators such as:
    — Elite SJW Globalist MegaCorporations
    — Hostile foreign governments, especially those with captive State Owned Enterprises (e.g. China)

    Part of protecting citizens from foreign exploitation is ensuring that essential goods are produced locally to guarantee they are available during a crisis. For example, the U.S. Government makes capitalist market purchases of U.S. produced oil and holds that essential material in the Strategic Petroleum Reserve [SPR].

    PEACE 😷

    • Agree: Achmed E. Newman
    • Replies: @dfordoom

    Part of protecting citizens from foreign exploitation is ensuring that essential goods are produced locally to guarantee they are available during a crisis.
     
    I’m going to suggest a few points that will probably provoke howls of outrage, but whatever.

    1. Manufacturing industry is largely irrelevant when it comes to fighting a virus outbreak like COVID-19. A month or so ago everybody thought ventilators were the answer and were bewailing the fact that American factories were not churning out tens of thousands of ventilators. Evidence is now accumulating that for treating this virus ventilators may be entirely useless or even harmful. And in any case that huge number of ventilators were never needed anyway and would never have been available in time. If American factories had churned out 100,000 extra ventilators the ventilators would have ended up sitting in warehouses and eventually being junked.

    To fight a virus outbreak you need a competent government, not manufacturing capacity.

    2. Rebuilding manufacturing industry would be extremely costly and would mean consumers paying much higher prices. Living standards would fall sharply. Most people would be worse off.

    3. Rebuilding manufacturing industry would distort and disrupt an already damaged economy and could cause economic disaster.

    4. Manufacturing industry would require massive protection. This would trigger all-out economic warfare with China and with the US economy in its present state there's no guarantee the US would win such an economic war. Such an economic war would also turn the whole of Asia against US.

    5. The idea of bringing back manufacturing is based on an illusion. The 50s were a golden age. We had lots of manufacturing industry in the 50s. Therefore if we rebuild manufacturing the golden age of the 50s will return. But it won't. The 50s was a golden age in many ways but the 50s are not coming back. You can't recreate the past because it's now a different world.

    6. This obsession with manufacturing industry is just electioneering. Trump and the GOP are desperate and they're clutching at straws to stave off defeat in November.

    7. This is another example of the right's obsession with finding simplistic answers to complex problems. Trying to rebuild the manufacturing sector might well wreck an already fragile economy. In the real world simplistic solutions don't work.
  128. @Adam Smith

    the $ is the world’s reserve currency, but that CANNOT last
     
    All part of the plan...

    https://www.aier.org/wp-content/uploads/2019/06/Reserve-Currencies.png

    I put an AGREE in, because I’ve see this graph before, and it’s enlightening. The thing I don’t agree with is that it’s planned, Adam. I think all of these empires that had their currencies used as the reserve around the world eventually tried to exist on reputation of past might and economic power, when it was all fading away. Without their going to a sound currency to reset the whole system (involving a lot of financial pain, but it’d be coming anyway), the world always realizes this and bails out. That happens slowly at first, then quickly.

    We’ve had a pretty long run, haven’t we? It could have been much longer but for the sick Socialists FDR, LBJ, and then Nixon too, taking us off of sound money.

    • Replies: @Adam Smith
    You are correct Mr. Newman...

    Especially about sound money...
    And also about the geometric progression of the hyper-inflationary death spiral...

    That thing about "all part of the plan" was off the cuff/tongue in cheek...

    I really didn't think it through... But I let it fly nonetheless...

    I think i once read a book...something about how we should never ascribe to malice that which is more easily explained by avarice, hubris, incompetence or imperial overreach...

    I think it was called Hanlon's Balisong...

    History does have a funny way of repeating the rhythms in rhymes...
  129. @Adam Smith

    the $ is the world’s reserve currency, but that CANNOT last
     
    All part of the plan...

    https://www.aier.org/wp-content/uploads/2019/06/Reserve-Currencies.png

    Do you think there was something that coincided with each country losing its status as the possessor of the global reserve currency? I really don’t know for sure. The only thing I can think of is that all these countries your chart shows got involved in prolonged wars that required maintaining a large expensive military. Spain had the Thirty Years war, The Dutch had wars against Louis XIV, France had the Napoleonic wars, Britain had World War I and the U.S. had the wars in the Mideast from 1990 up to the present. It might be a good idea to follow a less interventionist foreign policy if at all possible and keep overall government spending down, especially the military part of it.

    • Replies: @Audacious Epigone
    Having the world's reserve currency makes war seem irresistible to the powers that be. It's like holding the ring--and vanishingly few political leaders are like Frodo.
  130. @dfordoom


    I suspect that in a few months’ time the talk of bringing manufacturing industry back will be quietly dropped as an unrealistic pipe-dream.
     
    I hope you’re not right about that.
     
    There'll be lots of big talk from Trump about bringing back manufacturing. Once he's re-elected he'll drop the whole issue. The whole thing is an election ploy (like Trump's desperate attempts to blame China for his own blunders). There'll be lots of big talk from the GOP on the subject. There are lots of Republican congressmen and senators very nervous about losing their seats in November.

    Once the election is over, whoever wins, the issue will never be mentioned again. Politicians don't like tackling really hard really complex problems that have the potential to backfire on them. And they don't like tackling problems that might upset powerful interest groups. Bringing back manufacturing would in practice be the kind of nightmarishly difficult problem that politicians never ever tackle.

    The whole "let's make the evil Chinese pay" thing will also be quietly dropped after the election.

    And once the election is over stand by for the Republicans and Trump to switch to "we need massive increases in immigration to get the economy moving again."

    No politician wants to be argue for an increase in consumer prices in return for some policy goal like more domestic manufacturing. But it’s not going to matter because higher consumer prices are coming anyway. It’s unavoidable at this point.

    I think making China pay is definitely on the table because of the massive amount of US debt that China holds. The US Treasury can default on that debt on the pretense of making China pay. Once consumer prices really start going up, people are going to support reducing the amount of the federal budget that goes to Chinese holders of treasuries.

    One consequence of this will be a sharp decrease in Chinese exports to the US, both by way of Chinese political retaliation and also a weakened dollar. That will create an environment more conducive to domestic manufacturing.

    It’s going to painful to get there, but I actually think we will both sever our economic relationship with China in a substantial way and manufacture more things domestically over the next decade or so.

    • Replies: @Achmed E. Newman

    I think making China pay is definitely on the table because of the massive amount of US debt that China holds. The US Treasury can default on that debt on the pretense of making China pay.
     
    I don't see how that works, A.E. It's not like the debt is all on one big note, like a mortgage. Even before the Kung Flu, we'd have been justified in just saying "Hey, you all would be speaking Japanese right now, if we hadn't flew all that shit over the hump and fought the Japs all over the Pacific. Call it even. Yeah, I know, I know, it sucks, but listen, you fucked up, you trusted us!"

    (I had to get that Animal House line in, sorry.) Look, the debt is held in Treasury Bonds right? They are fungible, like 2o dollar bills. Some pension fund here picked up a tranche (whatever the hell that is) of 'em from this fund that came from China, etc., etc. Can you pick out certain Treasury Bonds and just say "hey, any of 'em that end in a 79 or 82-88 on the end are hereby void. We'll be glad to sell you some new ones, though ..."?

    I think going something like this would be the end of the dollar, not to say that it isn't going to happen sometime anyway ...
  131. @Mark G.
    Do you think there was something that coincided with each country losing its status as the possessor of the global reserve currency? I really don't know for sure. The only thing I can think of is that all these countries your chart shows got involved in prolonged wars that required maintaining a large expensive military. Spain had the Thirty Years war, The Dutch had wars against Louis XIV, France had the Napoleonic wars, Britain had World War I and the U.S. had the wars in the Mideast from 1990 up to the present. It might be a good idea to follow a less interventionist foreign policy if at all possible and keep overall government spending down, especially the military part of it.

    Having the world’s reserve currency makes war seem irresistible to the powers that be. It’s like holding the ring–and vanishingly few political leaders are like Frodo.

    • Agree: Mark G.
  132. @Adam Smith

    the $ is the world’s reserve currency, but that CANNOT last
     
    All part of the plan...

    https://www.aier.org/wp-content/uploads/2019/06/Reserve-Currencies.png

    Thanks. It looks like this page is the original source and it has a good bit more discussion.
    https://www.aier.org/article/u-s-dollar-supremacy-could-quickly-fade/

    It’s interesting that that article is from 2019, while here is a very similar graphic from a 2015 blog post:
    http://blog.zorangagic.com/2015/10/global-reserve-currencies-since-1450.html
    That post has an image which makes a provocative juxtaposition with yours.

    But this page indicates that in 2017 the US was 24.3% of world GDP with China at 14.8%.
    https://foreignpolicy.com/2017/02/24/infographic-heres-how-the-global-gdp-is-divvied-up/

    • Thanks: Audacious Epigone
    • Replies: @Achmed E. Newman
    Cool charts, Res. Thank you!
    , @utu
    GDP does not tell the whole story. Look at the trade balance.

    Largest negative balance: US, UK, Canada, Australia
    Largest positive balance: Germany, Japan, China, Netherlands, South Korea, Switzerland
    https://en.wikipedia.org/wiki/List_of_countries_by_current_account_balance

    I guess that all the US fleets from the 2nd Fleet to the 7th Fleet are there to make sure that the steady outflow of money form the US will no lead to the pressure on American assets by forcing the positive balance countries to spend their dollars on oil and those who sell oil on American weapons. There is nothing original to it. It has been practiced by those who could from the beginning of history . More recent examples was British Empire and Opium and on much smaller scale the Coal Company Stores somewhere in Pennsylvania or West Virginia.

    The position of the dominant power can only be challenged with the production and trade control. Alexander Hamilton in the US knew it and Georg Friedrich List in Germany knew it. Both died a violent death. Though their ideas have succeeded transforming the US and Germany into great economic powers by the end of the 19th century.
    , @Adam Smith
    Hey res,

    Thanks for the excellent comment and links.

    I do find this chart to be most interesting...

    https://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2014/09/20140912_USANo2_0.jpg

    Provocative juxtaposition indeed.
  133. @Audacious Epigone
    No politician wants to be argue for an increase in consumer prices in return for some policy goal like more domestic manufacturing. But it's not going to matter because higher consumer prices are coming anyway. It's unavoidable at this point.

    I think making China pay is definitely on the table because of the massive amount of US debt that China holds. The US Treasury can default on that debt on the pretense of making China pay. Once consumer prices really start going up, people are going to support reducing the amount of the federal budget that goes to Chinese holders of treasuries.

    One consequence of this will be a sharp decrease in Chinese exports to the US, both by way of Chinese political retaliation and also a weakened dollar. That will create an environment more conducive to domestic manufacturing.

    It's going to painful to get there, but I actually think we will both sever our economic relationship with China in a substantial way and manufacture more things domestically over the next decade or so.

    I think making China pay is definitely on the table because of the massive amount of US debt that China holds. The US Treasury can default on that debt on the pretense of making China pay.

    I don’t see how that works, A.E. It’s not like the debt is all on one big note, like a mortgage. Even before the Kung Flu, we’d have been justified in just saying “Hey, you all would be speaking Japanese right now, if we hadn’t flew all that shit over the hump and fought the Japs all over the Pacific. Call it even. Yeah, I know, I know, it sucks, but listen, you fucked up, you trusted us!”

    (I had to get that Animal House line in, sorry.) Look, the debt is held in Treasury Bonds right? They are fungible, like 2o dollar bills. Some pension fund here picked up a tranche (whatever the hell that is) of ’em from this fund that came from China, etc., etc. Can you pick out certain Treasury Bonds and just say “hey, any of ’em that end in a 79 or 82-88 on the end are hereby void. We’ll be glad to sell you some new ones, though …”?

    I think going something like this would be the end of the dollar, not to say that it isn’t going to happen sometime anyway …

    • Replies: @Audacious Epigone
    The sale of treasuries are theoretically all tracked, but there's an easier way--default on all outstanding treasuries and then pay the principal plus a premium for all US citizens (and citizens of favored nations, potentially) who redeem their defaulted treasuries with proof of their having been purchased on X date. There'd be some fraud, of course, but China would still take an enormous haircut while Americans holding federal debt would be made whole and then some, at least nominally.
  134. @res
    Thanks. It looks like this page is the original source and it has a good bit more discussion.
    https://www.aier.org/article/u-s-dollar-supremacy-could-quickly-fade/

    It's interesting that that article is from 2019, while here is a very similar graphic from a 2015 blog post:
    http://blog.zorangagic.com/2015/10/global-reserve-currencies-since-1450.html
    That post has an image which makes a provocative juxtaposition with yours.

    http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2014/09/20140912_USANo2_0.jpg

    But this page indicates that in 2017 the US was 24.3% of world GDP with China at 14.8%.
    https://foreignpolicy.com/2017/02/24/infographic-heres-how-the-global-gdp-is-divvied-up/

    https://foreignpolicy.com/wp-content/uploads/2017/02/world-gdp-41ff.png

    Cool charts, Res. Thank you!

  135. @A123
    Socialism/Communism is government owning & directing civilian production & firms. It is the pinnacle of Authoritarian government systems. Remember, you cannot have National Socialism without Socialism.
    _____

    Populism is government protecting citizens and civilian companies from predators such as:
    -- Elite SJW Globalist MegaCorporations
    -- Hostile foreign governments, especially those with captive State Owned Enterprises (e.g. China)

    Part of protecting citizens from foreign exploitation is ensuring that essential goods are produced locally to guarantee they are available during a crisis. For example, the U.S. Government makes capitalist market purchases of U.S. produced oil and holds that essential material in the Strategic Petroleum Reserve [SPR].

    PEACE 😷

    Part of protecting citizens from foreign exploitation is ensuring that essential goods are produced locally to guarantee they are available during a crisis.

    I’m going to suggest a few points that will probably provoke howls of outrage, but whatever.

    1. Manufacturing industry is largely irrelevant when it comes to fighting a virus outbreak like COVID-19. A month or so ago everybody thought ventilators were the answer and were bewailing the fact that American factories were not churning out tens of thousands of ventilators. Evidence is now accumulating that for treating this virus ventilators may be entirely useless or even harmful. And in any case that huge number of ventilators were never needed anyway and would never have been available in time. If American factories had churned out 100,000 extra ventilators the ventilators would have ended up sitting in warehouses and eventually being junked.

    To fight a virus outbreak you need a competent government, not manufacturing capacity.

    2. Rebuilding manufacturing industry would be extremely costly and would mean consumers paying much higher prices. Living standards would fall sharply. Most people would be worse off.

    3. Rebuilding manufacturing industry would distort and disrupt an already damaged economy and could cause economic disaster.

    4. Manufacturing industry would require massive protection. This would trigger all-out economic warfare with China and with the US economy in its present state there’s no guarantee the US would win such an economic war. Such an economic war would also turn the whole of Asia against US.

    5. The idea of bringing back manufacturing is based on an illusion. The 50s were a golden age. We had lots of manufacturing industry in the 50s. Therefore if we rebuild manufacturing the golden age of the 50s will return. But it won’t. The 50s was a golden age in many ways but the 50s are not coming back. You can’t recreate the past because it’s now a different world.

    6. This obsession with manufacturing industry is just electioneering. Trump and the GOP are desperate and they’re clutching at straws to stave off defeat in November.

    7. This is another example of the right’s obsession with finding simplistic answers to complex problems. Trying to rebuild the manufacturing sector might well wreck an already fragile economy. In the real world simplistic solutions don’t work.

    • Replies: @iffen
    7. This is another example of the right’s obsession with finding simplistic answers to complex problems.

    Works for the authoritarian left and the answers don't even have to work.
    , @A123

    4. Manufacturing industry would require massive protection. This would trigger all-out economic warfare with China and with the US
     
    China declared economic war decades ago. I am suggesting that the U.S. fight the war China started.

    For example -- The U.S. steel industry is more efficient and less expensive than China's. China dumped steel at under market prices in a deliberate attack on the U.S. Steel industry. The dumping occurred for an extended period of time allowing CCP government subsidized producers to undermine U.S. unsubsidized firms.

    Are you suggesting that the U.S. surrender to Chinese aggression?


    5. The idea of bringing back manufacturing is based on an illusion. The 50s were a golden age. We had lots of manufacturing industry in the 50s. Therefore if we rebuild manufacturing the golden age of the 50s will return. But it won’t. The 50s was a golden age in many ways but the 50s are not coming back. You can’t recreate the past because it’s now a different world.
     
    This is a strawman.

    Current manufacturing is quite different from 50's manufacturing. The U.S. can run high quality, price competitive manufacturing. Defeating overseas based, government controlled competitors does not automatically imply higher prices.

    Many of the problems are related to Globalist multinational firms that rigged the system. Their lobbyists built special advantages for themselves into laws and especially regulations. Limiting the scope and power of unelected bureaucrats will reduce regulatory compliance spending and unshackle small businesses in the U.S.

    PEACE 😷

    , @Mr. Rational

    Rebuilding manufacturing industry would be extremely costly and would mean consumers paying much higher prices.
     
    There are examples which prove this false.  Generac is my favorite.  Generac sent its manufacturing to China, closing a plant in (I think) Wisconsin.  However, the loss of quality and issues with communications and time lags led Generac to bring the work back to the USA.  But not to the old plant; Generac automated many steps and the new plant employs something like 20% of the previous headcount.  Of course, quality of the operations which have been automated is uniformly high, and Generac no longer has issues with communications or shipping lags.  It also has about 5x the productivity.

    Things seem to be going well for Generac; my neighbors on both sides have Generac standby units.
  136. @76239
    Gold and silver were chosen as money long before central banks or central governments. Therefore, it does not need government approval to have value. They are the true people's money because the people chose them as money.

    If someone had lots of gold, the best thing to happen to them would be if the government made gold illegal to possess. Its value would sky rocket. Just because gold would be illegal wouldn't mean people wouldn't buy it like they buy any other illegal commodity.

    You are much like many of these writers on UNZ on Corona, they watch waay to much TV and believe far too much government bull shit to be any value.

    If someone had lots of gold, the best thing to happen to them would be if the government made gold illegal to possess. Its value would sky rocket …

    It happened in India, more than half a century ago.

    https://en.wikipedia.org/wiki/The_Gold_(Control)_Act,_1968

    Post-Independence, the foreign exchange drain was accentuated in 1962 during the border dispute with China. Morarji Desai, then finance minister, came out with Gold Control Act, 1962, which recalled all gold loans given by banks and banned forward trading in gold. In 1963, the production of gold jewellery above 14 carat fineness was banned. In 1965, a gold bond scheme was launched with tax immunity for unaccounted wealth. All these steps failed to yield the desired result.

    Desai finally introduced the Gold Control Act, on 24 August 1968, which prohibited citizens from owning gold in the form of bars and coins. All existing holding of gold coins and bars had to be converted to jewellery and declared to the authorities.

    Goldsmiths were not allowed to own more than 100 g of gold. Licensed dealers were not supposed to own more than 2 kg of gold, depending upon the number of artisans employed by them. They were banned from trading with each other.

    Desai believed that Indians would respond positively to these steps and stop consuming gold and help conserve precious foreign exchange. New gold jewellery purchases were either recycled or smuggled gold.

    This legislation killed the official gold market and a large unofficial market sprung up dealing in cash only. The gold was smuggled in and sold through the unofficial channel wherein, many jewellers and bullion traders traded in smuggled gold. A huge black market developed for gold.

  137. @Achmed E. Newman
    I put an AGREE in, because I've see this graph before, and it's enlightening. The thing I don't agree with is that it's planned, Adam. I think all of these empires that had their currencies used as the reserve around the world eventually tried to exist on reputation of past might and economic power, when it was all fading away. Without their going to a sound currency to reset the whole system (involving a lot of financial pain, but it'd be coming anyway), the world always realizes this and bails out. That happens slowly at first, then quickly.

    We've had a pretty long run, haven't we? It could have been much longer but for the sick Socialists FDR, LBJ, and then Nixon too, taking us off of sound money.

    You are correct Mr. Newman…

    Especially about sound money…
    And also about the geometric progression of the hyper-inflationary death spiral…

    That thing about “all part of the plan” was off the cuff/tongue in cheek…

    I really didn’t think it through… But I let it fly nonetheless…

    I think i once read a book…something about how we should never ascribe to malice that which is more easily explained by avarice, hubris, incompetence or imperial overreach…

    I think it was called Hanlon’s Balisong…

    History does have a funny way of repeating the rhythms in rhymes…

    • Agree: Achmed E. Newman
  138. @dfordoom

    Part of protecting citizens from foreign exploitation is ensuring that essential goods are produced locally to guarantee they are available during a crisis.
     
    I’m going to suggest a few points that will probably provoke howls of outrage, but whatever.

    1. Manufacturing industry is largely irrelevant when it comes to fighting a virus outbreak like COVID-19. A month or so ago everybody thought ventilators were the answer and were bewailing the fact that American factories were not churning out tens of thousands of ventilators. Evidence is now accumulating that for treating this virus ventilators may be entirely useless or even harmful. And in any case that huge number of ventilators were never needed anyway and would never have been available in time. If American factories had churned out 100,000 extra ventilators the ventilators would have ended up sitting in warehouses and eventually being junked.

    To fight a virus outbreak you need a competent government, not manufacturing capacity.

    2. Rebuilding manufacturing industry would be extremely costly and would mean consumers paying much higher prices. Living standards would fall sharply. Most people would be worse off.

    3. Rebuilding manufacturing industry would distort and disrupt an already damaged economy and could cause economic disaster.

    4. Manufacturing industry would require massive protection. This would trigger all-out economic warfare with China and with the US economy in its present state there's no guarantee the US would win such an economic war. Such an economic war would also turn the whole of Asia against US.

    5. The idea of bringing back manufacturing is based on an illusion. The 50s were a golden age. We had lots of manufacturing industry in the 50s. Therefore if we rebuild manufacturing the golden age of the 50s will return. But it won't. The 50s was a golden age in many ways but the 50s are not coming back. You can't recreate the past because it's now a different world.

    6. This obsession with manufacturing industry is just electioneering. Trump and the GOP are desperate and they're clutching at straws to stave off defeat in November.

    7. This is another example of the right's obsession with finding simplistic answers to complex problems. Trying to rebuild the manufacturing sector might well wreck an already fragile economy. In the real world simplistic solutions don't work.

    7. This is another example of the right’s obsession with finding simplistic answers to complex problems.

    Works for the authoritarian left and the answers don’t even have to work.

    • Replies: @A123


    dfordoom -- 7. This is another example of the right’s obsession with finding simplistic answers to complex problems.
     
    iffen -- Works for the authoritarian left and the answers don’t even have to work.
     
    Based on our last round of discussions, I am actively trying to avoid 'Left-Right' as terminology. Trump and Romney are blood enemies. Which is 'Left' and which is 'Right'?

    'Globalist-Populist' makes much more sense in the current environment. Romney represents Globalist values. Trump represents Populist values.

    PEACE 😷

    , @dfordoom


    7. This is another example of the right’s obsession with finding simplistic answers to complex problems.
     
    Works for the authoritarian left and the answers don’t even have to work.
     
    Stupidity is only bad when it's the left doing it? Right-wing stupidity good. Left-wing stupidity bad.
  139. @iffen
    7. This is another example of the right’s obsession with finding simplistic answers to complex problems.

    Works for the authoritarian left and the answers don't even have to work.

    dfordoom — 7. This is another example of the right’s obsession with finding simplistic answers to complex problems.

    iffen — Works for the authoritarian left and the answers don’t even have to work.

    Based on our last round of discussions, I am actively trying to avoid ‘Left-Right’ as terminology. Trump and Romney are blood enemies. Which is ‘Left’ and which is ‘Right’?

    ‘Globalist-Populist’ makes much more sense in the current environment. Romney represents Globalist values. Trump represents Populist values.

    PEACE 😷

    • Replies: @iffen
    I am actively trying to avoid ‘Left-Right’ as terminology.

    I sympathize with dealing with the problem, but you will not be able to overturn over three hundred years of usage.

  140. @dfordoom

    Part of protecting citizens from foreign exploitation is ensuring that essential goods are produced locally to guarantee they are available during a crisis.
     
    I’m going to suggest a few points that will probably provoke howls of outrage, but whatever.

    1. Manufacturing industry is largely irrelevant when it comes to fighting a virus outbreak like COVID-19. A month or so ago everybody thought ventilators were the answer and were bewailing the fact that American factories were not churning out tens of thousands of ventilators. Evidence is now accumulating that for treating this virus ventilators may be entirely useless or even harmful. And in any case that huge number of ventilators were never needed anyway and would never have been available in time. If American factories had churned out 100,000 extra ventilators the ventilators would have ended up sitting in warehouses and eventually being junked.

    To fight a virus outbreak you need a competent government, not manufacturing capacity.

    2. Rebuilding manufacturing industry would be extremely costly and would mean consumers paying much higher prices. Living standards would fall sharply. Most people would be worse off.

    3. Rebuilding manufacturing industry would distort and disrupt an already damaged economy and could cause economic disaster.

    4. Manufacturing industry would require massive protection. This would trigger all-out economic warfare with China and with the US economy in its present state there's no guarantee the US would win such an economic war. Such an economic war would also turn the whole of Asia against US.

    5. The idea of bringing back manufacturing is based on an illusion. The 50s were a golden age. We had lots of manufacturing industry in the 50s. Therefore if we rebuild manufacturing the golden age of the 50s will return. But it won't. The 50s was a golden age in many ways but the 50s are not coming back. You can't recreate the past because it's now a different world.

    6. This obsession with manufacturing industry is just electioneering. Trump and the GOP are desperate and they're clutching at straws to stave off defeat in November.

    7. This is another example of the right's obsession with finding simplistic answers to complex problems. Trying to rebuild the manufacturing sector might well wreck an already fragile economy. In the real world simplistic solutions don't work.

    4. Manufacturing industry would require massive protection. This would trigger all-out economic warfare with China and with the US

    China declared economic war decades ago. I am suggesting that the U.S. fight the war China started.

    For example — The U.S. steel industry is more efficient and less expensive than China’s. China dumped steel at under market prices in a deliberate attack on the U.S. Steel industry. The dumping occurred for an extended period of time allowing CCP government subsidized producers to undermine U.S. unsubsidized firms.

    Are you suggesting that the U.S. surrender to Chinese aggression?

    5. The idea of bringing back manufacturing is based on an illusion. The 50s were a golden age. We had lots of manufacturing industry in the 50s. Therefore if we rebuild manufacturing the golden age of the 50s will return. But it won’t. The 50s was a golden age in many ways but the 50s are not coming back. You can’t recreate the past because it’s now a different world.

    This is a strawman.

    Current manufacturing is quite different from 50’s manufacturing. The U.S. can run high quality, price competitive manufacturing. Defeating overseas based, government controlled competitors does not automatically imply higher prices.

    Many of the problems are related to Globalist multinational firms that rigged the system. Their lobbyists built special advantages for themselves into laws and especially regulations. Limiting the scope and power of unelected bureaucrats will reduce regulatory compliance spending and unshackle small businesses in the U.S.

    PEACE 😷

    • Replies: @dfordoom

    Current manufacturing is quite different from 50’s manufacturing. The U.S. can run high quality, price competitive manufacturing. Defeating overseas based, government controlled competitors does not automatically imply higher prices.
     
    I'll wager that higher prices is what you'll end up with.
    , @dfordoom

    Are you suggesting that the U.S. surrender to Chinese aggression?
     
    The Chinese aggression is all in your head.
  141. @iffen
    7. This is another example of the right’s obsession with finding simplistic answers to complex problems.

    Works for the authoritarian left and the answers don't even have to work.

    7. This is another example of the right’s obsession with finding simplistic answers to complex problems.

    Works for the authoritarian left and the answers don’t even have to work.

    Stupidity is only bad when it’s the left doing it? Right-wing stupidity good. Left-wing stupidity bad.

    • Replies: @iffen
    Stupidity is only bad when it’s the left doing it? Right-wing stupidity good. Left-wing stupidity bad.

    Yes, the disaster that is today's world is almost completely the result of policies implemented by the left. About the only things that we can lay on the right are tax cuts for the rich. Many policies, like globalization for example, are enthusiastically pushed by both.

  142. @Audacious Epigone
    The big investment banks are the ultimate creditors. They love the current system and loathe the idea of sound money of any kind. Fiat currency is another example of the top (creditors) and the bottom (debtors) against the middle (savers).

    “They love the current system…” – They might be the only ones who understand it. They are the only ones who are in the position to write bills and lobby for them to make changes they want. Their ‘reforms’ go uncontested which was not a case in 1930th.

    “and loathe the idea of sound money of any kind.” – Sound money does not really exit. Ideas of it do exist but any money can always be corrupted. One reason real gold or silver money was replaced with bills of exchange because the gold coins could not be trusted; almost every body was engaging in diluting gold or silver in their coins and thus in the process it was discovered you do not need gold or silver to run the economy.

    • Replies: @Audacious Epigone
    True, but there are degrees of relative soundness and it's easier to verify the integrity of gold today than before. If it could be exchanged electronically with third party broker like Brinks holding the actual bullion, it might become viable. The political barriers are huge. If the dollar breaks, those barriers will weaken, though.
  143. @A123

    4. Manufacturing industry would require massive protection. This would trigger all-out economic warfare with China and with the US
     
    China declared economic war decades ago. I am suggesting that the U.S. fight the war China started.

    For example -- The U.S. steel industry is more efficient and less expensive than China's. China dumped steel at under market prices in a deliberate attack on the U.S. Steel industry. The dumping occurred for an extended period of time allowing CCP government subsidized producers to undermine U.S. unsubsidized firms.

    Are you suggesting that the U.S. surrender to Chinese aggression?


    5. The idea of bringing back manufacturing is based on an illusion. The 50s were a golden age. We had lots of manufacturing industry in the 50s. Therefore if we rebuild manufacturing the golden age of the 50s will return. But it won’t. The 50s was a golden age in many ways but the 50s are not coming back. You can’t recreate the past because it’s now a different world.
     
    This is a strawman.

    Current manufacturing is quite different from 50's manufacturing. The U.S. can run high quality, price competitive manufacturing. Defeating overseas based, government controlled competitors does not automatically imply higher prices.

    Many of the problems are related to Globalist multinational firms that rigged the system. Their lobbyists built special advantages for themselves into laws and especially regulations. Limiting the scope and power of unelected bureaucrats will reduce regulatory compliance spending and unshackle small businesses in the U.S.

    PEACE 😷

    Current manufacturing is quite different from 50’s manufacturing. The U.S. can run high quality, price competitive manufacturing. Defeating overseas based, government controlled competitors does not automatically imply higher prices.

    I’ll wager that higher prices is what you’ll end up with.

    • Replies: @Jedi Night
    The reserve currency issue is the same issue as mass immigration and the disappearance of manufacturing. We have mass immigration BECAUSE the $ is global reserve currency. We lost our manufacturing BECAUSE the $ is global reserve currency.


    If the dollar were no longer global reserve currency, other countries would no longer need to accumulate dollars, and they wouldn't have to devalue their own currency to gain trade advantage for their manufacturing.

    The high value $ draws immigrant labor here as well.

    The high value $ means it's cheaper to buy new imports rather than repair what you already own, driving environmental unsustainability and waste.

    It makes us artificially richer, but the quicker we get the rest of the world to stop needing to hoard our domestic currency, the better.
    , @EldnahYm
    We already had a test run of this with the Trump anti-China tariffs. All of the experts screamed about higher prices for the U.S. consumer. In reality there was not a noticeable difference. Many manufactured goods probably could be brought back with little cost to the consumer, especially if done in an intelligent manner. It's important to remember that the U.S. is in a vastly different situation in terms of raw materials cost than it was in the 1970s. Higher wages are the most significant differentiator and that difference is going to decrease over the years as East Asian wages rise and East Asia turns into an old folk's home.

    The future is likely to see more overseas companies doing what Japanese auto manufacturers are doing today, taking their plants and infrastructure and moving them to the U.S. to sell directly to the U.S. consumer.
  144. @A123

    4. Manufacturing industry would require massive protection. This would trigger all-out economic warfare with China and with the US
     
    China declared economic war decades ago. I am suggesting that the U.S. fight the war China started.

    For example -- The U.S. steel industry is more efficient and less expensive than China's. China dumped steel at under market prices in a deliberate attack on the U.S. Steel industry. The dumping occurred for an extended period of time allowing CCP government subsidized producers to undermine U.S. unsubsidized firms.

    Are you suggesting that the U.S. surrender to Chinese aggression?


    5. The idea of bringing back manufacturing is based on an illusion. The 50s were a golden age. We had lots of manufacturing industry in the 50s. Therefore if we rebuild manufacturing the golden age of the 50s will return. But it won’t. The 50s was a golden age in many ways but the 50s are not coming back. You can’t recreate the past because it’s now a different world.
     
    This is a strawman.

    Current manufacturing is quite different from 50's manufacturing. The U.S. can run high quality, price competitive manufacturing. Defeating overseas based, government controlled competitors does not automatically imply higher prices.

    Many of the problems are related to Globalist multinational firms that rigged the system. Their lobbyists built special advantages for themselves into laws and especially regulations. Limiting the scope and power of unelected bureaucrats will reduce regulatory compliance spending and unshackle small businesses in the U.S.

    PEACE 😷

    Are you suggesting that the U.S. surrender to Chinese aggression?

    The Chinese aggression is all in your head.

    • LOL: A123
  145. @dfordoom


    7. This is another example of the right’s obsession with finding simplistic answers to complex problems.
     
    Works for the authoritarian left and the answers don’t even have to work.
     
    Stupidity is only bad when it's the left doing it? Right-wing stupidity good. Left-wing stupidity bad.

    Stupidity is only bad when it’s the left doing it? Right-wing stupidity good. Left-wing stupidity bad.

    Yes, the disaster that is today’s world is almost completely the result of policies implemented by the left. About the only things that we can lay on the right are tax cuts for the rich. Many policies, like globalization for example, are enthusiastically pushed by both.

  146. @A123


    dfordoom -- 7. This is another example of the right’s obsession with finding simplistic answers to complex problems.
     
    iffen -- Works for the authoritarian left and the answers don’t even have to work.
     
    Based on our last round of discussions, I am actively trying to avoid 'Left-Right' as terminology. Trump and Romney are blood enemies. Which is 'Left' and which is 'Right'?

    'Globalist-Populist' makes much more sense in the current environment. Romney represents Globalist values. Trump represents Populist values.

    PEACE 😷

    I am actively trying to avoid ‘Left-Right’ as terminology.

    I sympathize with dealing with the problem, but you will not be able to overturn over three hundred years of usage.

  147. @res
    Thanks. It looks like this page is the original source and it has a good bit more discussion.
    https://www.aier.org/article/u-s-dollar-supremacy-could-quickly-fade/

    It's interesting that that article is from 2019, while here is a very similar graphic from a 2015 blog post:
    http://blog.zorangagic.com/2015/10/global-reserve-currencies-since-1450.html
    That post has an image which makes a provocative juxtaposition with yours.

    http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2014/09/20140912_USANo2_0.jpg

    But this page indicates that in 2017 the US was 24.3% of world GDP with China at 14.8%.
    https://foreignpolicy.com/2017/02/24/infographic-heres-how-the-global-gdp-is-divvied-up/

    https://foreignpolicy.com/wp-content/uploads/2017/02/world-gdp-41ff.png

    GDP does not tell the whole story. Look at the trade balance.

    Largest negative balance: US, UK, Canada, Australia
    Largest positive balance: Germany, Japan, China, Netherlands, South Korea, Switzerland
    https://en.wikipedia.org/wiki/List_of_countries_by_current_account_balance

    I guess that all the US fleets from the 2nd Fleet to the 7th Fleet are there to make sure that the steady outflow of money form the US will no lead to the pressure on American assets by forcing the positive balance countries to spend their dollars on oil and those who sell oil on American weapons. There is nothing original to it. It has been practiced by those who could from the beginning of history . More recent examples was British Empire and Opium and on much smaller scale the Coal Company Stores somewhere in Pennsylvania or West Virginia.

    The position of the dominant power can only be challenged with the production and trade control. Alexander Hamilton in the US knew it and Georg Friedrich List in Germany knew it. Both died a violent death. Though their ideas have succeeded transforming the US and Germany into great economic powers by the end of the 19th century.

  148. @dfordoom

    Current manufacturing is quite different from 50’s manufacturing. The U.S. can run high quality, price competitive manufacturing. Defeating overseas based, government controlled competitors does not automatically imply higher prices.
     
    I'll wager that higher prices is what you'll end up with.

    The reserve currency issue is the same issue as mass immigration and the disappearance of manufacturing. We have mass immigration BECAUSE the $ is global reserve currency. We lost our manufacturing BECAUSE the $ is global reserve currency.

    If the dollar were no longer global reserve currency, other countries would no longer need to accumulate dollars, and they wouldn’t have to devalue their own currency to gain trade advantage for their manufacturing.

    The high value $ draws immigrant labor here as well.

    The high value $ means it’s cheaper to buy new imports rather than repair what you already own, driving environmental unsustainability and waste.

    It makes us artificially richer, but the quicker we get the rest of the world to stop needing to hoard our domestic currency, the better.

  149. @Cloudbuster
    The gold standard of that time was simply an agreement that other countries, which fixed the value of their currency to the U.S. dollar, could exchange their dollar holdings for gold at a fixed price. The U.S. already had the ability to print as much fiat currency as it wanted.

    You understand the import of that statement explains exactly why the US government couldn't print as much money as it wanted: the requirement that it be able to exchange dollars for gold at a fixed price. The government can always print paper money in a certain excess of gold holdings, but if people realize that the government is abusing this power, you get bank runs as people ditch your currency.

    Inflation is one answer to your question. Another is that there is no political will or reason to hand out 100 million dollars for everybody. If everyone has 100 million dollars, 100 million dollars is worthless. Once upon

    Inflation is the name of the game. The government loves a certain amount of inflation. The only reason it doesn't love a ton of inflation is that it makes the scam too obvious. We've been running an inflationary economy since the Great Depression. It functions as a non-legislated wealth tax. Historically speaking $100 million dollars is now nearly worthless compared to what it could buy in 1900 (about $3 billion in today's dollars). The federal government just printed several trillion dollars of fiat money, most of which went to banks and a pittance of which went to individuals and small businesses as a PR stunt.

    They've been doing that repeatedly, in smaller amounts for a couple decades now. But typically most of it isn't allowed in general circulation, which is why the velocity of the dollar has been plummeting for decades -- most of the dollars don't actually circulate, they just sit there as debt instruments. That's why inflation hasn't risen yet.

    They're playing a dangerous game. It's a huge house of cards. I couldn't say how long it can last, but it definitely isn't healthy. Every year the government outspends its revenues by 2-3x. There is simply no way to generate enough revenue to make a dent in that -- you might as well stop collecting revenue completely for all the good it does.

    There is no strategy to do anything about this except trying to slowly bleed the debt away through inflation -- they would really love to have them some more inflation, but the debt has become so expensive that even small amounts of additional inflation can be catastrophic, so they're slowly backing themselves into a corner.

    That's what fiat money does.

    You understand the import of that statement explains exactly why the US government couldn’t print as much money as it wanted: the requirement that it be able to exchange dollars for gold at a fixed price. The government can always print paper money in a certain excess of gold holdings, but if people realize that the government is abusing this power, you get bank runs as people ditch your currency.

    It had to exchange gold only for foreign dollar holdings. The U.S. fiscal policy was not impacted by the gold standard. Audacious Epigone’s comment section is apparently too dim to understand this, so I’ll spell it out: The U.S. as the world reserve currency is the cause of the draining of gold reserves, not U.S. domestic policy. Or to put it another way, the foreign demand for U.S. dollars was the cause of a draining of gold reserves, not the amount “printed.”

    Inflation is the name of the game. The government loves a certain amount of inflation. The only reason it doesn’t love a ton of inflation is that it makes the scam too obvious. We’ve been running an inflationary economy since the Great Depression. It functions as a non-legislated wealth tax. Historically speaking $100 million dollars is now nearly worthless compared to what it could buy in 1900 (about $3 billion in today’s dollars). The federal government just printed several trillion dollars of fiat money, most of which went to banks and a pittance of which went to individuals and small businesses as a PR stunt.

    They’ve been doing that repeatedly, in smaller amounts for a couple decades now. But typically most of it isn’t allowed in general circulation, which is why the velocity of the dollar has been plummeting for decades — most of the dollars don’t actually circulate, they just sit there as debt instruments. That’s why inflation hasn’t risen yet.

    They’re playing a dangerous game. It’s a huge house of cards. I couldn’t say how long it can last, but it definitely isn’t healthy. Every year the government outspends its revenues by 2-3x. There is simply no way to generate enough revenue to make a dent in that — you might as well stop collecting revenue completely for all the good it does.

    There is no strategy to do anything about this except trying to slowly bleed the debt away through inflation — they would really love to have them some more inflation, but the debt has become so expensive that even small amounts of additional inflation can be catastrophic, so they’re slowly backing themselves into a corner.

    That’s what fiat money does.

    That’s an utterly worthless rant that has nothing to do with anything. However, I’ll at least you credit for managing to notice that most of the theoretical new currency in circulation is not actually so. This observation has so far been beyond many of the commenters here. Everything else you said is completely wrong unfortunately. If you had cut out “yet” from the following sentence: “That’s why inflation hasn’t risen yet.” you could have at least gotten one thing right.

    What can’t fiat money do? It’s amusing to read people list a bunch of things they consider bad, then attribute them to “fiat money,” and not even bother to check if there are historical examples of the exactly the things they describe which existed during periods of acceptance of the gold standard.

  150. @dfordoom

    Current manufacturing is quite different from 50’s manufacturing. The U.S. can run high quality, price competitive manufacturing. Defeating overseas based, government controlled competitors does not automatically imply higher prices.
     
    I'll wager that higher prices is what you'll end up with.

    We already had a test run of this with the Trump anti-China tariffs. All of the experts screamed about higher prices for the U.S. consumer. In reality there was not a noticeable difference. Many manufactured goods probably could be brought back with little cost to the consumer, especially if done in an intelligent manner. It’s important to remember that the U.S. is in a vastly different situation in terms of raw materials cost than it was in the 1970s. Higher wages are the most significant differentiator and that difference is going to decrease over the years as East Asian wages rise and East Asia turns into an old folk’s home.

    The future is likely to see more overseas companies doing what Japanese auto manufacturers are doing today, taking their plants and infrastructure and moving them to the U.S. to sell directly to the U.S. consumer.

    • Replies: @dfordoom

    Many manufactured goods probably could be brought back with little cost to the consumer, especially if done in an intelligent manner.
     
    Isn't it more likely that manufacturing will simply move to countries like Vietnam or Malaysia?

    If those goods could be manufactured in the US and sold at the same price it would be happening now.

    What's most likely is that the US taxpayer will be asked to pay hundreds of billions or even trillions of dollars to subsidise manufacture in the US. It will be corporate welfare on a massive scale. A few people at the top will get much much richer, the taxpayer and the consumer will get screwed.

    Has it ever worked out any other way? Do you seriously think that there are any politicians who actually give a damn about ordinary people? Looking after ordinary people is not popular with the donors who own those politicians.

    I'm amazed at the naïvete on this issue. This issue is just another opportunity for corrupt politicians and businessmen to enrich themselves. A bit like Green Energy.
  151. @Achmed E. Newman

    I think making China pay is definitely on the table because of the massive amount of US debt that China holds. The US Treasury can default on that debt on the pretense of making China pay.
     
    I don't see how that works, A.E. It's not like the debt is all on one big note, like a mortgage. Even before the Kung Flu, we'd have been justified in just saying "Hey, you all would be speaking Japanese right now, if we hadn't flew all that shit over the hump and fought the Japs all over the Pacific. Call it even. Yeah, I know, I know, it sucks, but listen, you fucked up, you trusted us!"

    (I had to get that Animal House line in, sorry.) Look, the debt is held in Treasury Bonds right? They are fungible, like 2o dollar bills. Some pension fund here picked up a tranche (whatever the hell that is) of 'em from this fund that came from China, etc., etc. Can you pick out certain Treasury Bonds and just say "hey, any of 'em that end in a 79 or 82-88 on the end are hereby void. We'll be glad to sell you some new ones, though ..."?

    I think going something like this would be the end of the dollar, not to say that it isn't going to happen sometime anyway ...

    The sale of treasuries are theoretically all tracked, but there’s an easier way–default on all outstanding treasuries and then pay the principal plus a premium for all US citizens (and citizens of favored nations, potentially) who redeem their defaulted treasuries with proof of their having been purchased on X date. There’d be some fraud, of course, but China would still take an enormous haircut while Americans holding federal debt would be made whole and then some, at least nominally.

  152. @utu
    "They love the current system..." - They might be the only ones who understand it. They are the only ones who are in the position to write bills and lobby for them to make changes they want. Their 'reforms' go uncontested which was not a case in 1930th.

    "and loathe the idea of sound money of any kind." - Sound money does not really exit. Ideas of it do exist but any money can always be corrupted. One reason real gold or silver money was replaced with bills of exchange because the gold coins could not be trusted; almost every body was engaging in diluting gold or silver in their coins and thus in the process it was discovered you do not need gold or silver to run the economy.

    True, but there are degrees of relative soundness and it’s easier to verify the integrity of gold today than before. If it could be exchanged electronically with third party broker like Brinks holding the actual bullion, it might become viable. The political barriers are huge. If the dollar breaks, those barriers will weaken, though.

  153. @EldnahYm
    We already had a test run of this with the Trump anti-China tariffs. All of the experts screamed about higher prices for the U.S. consumer. In reality there was not a noticeable difference. Many manufactured goods probably could be brought back with little cost to the consumer, especially if done in an intelligent manner. It's important to remember that the U.S. is in a vastly different situation in terms of raw materials cost than it was in the 1970s. Higher wages are the most significant differentiator and that difference is going to decrease over the years as East Asian wages rise and East Asia turns into an old folk's home.

    The future is likely to see more overseas companies doing what Japanese auto manufacturers are doing today, taking their plants and infrastructure and moving them to the U.S. to sell directly to the U.S. consumer.

    Many manufactured goods probably could be brought back with little cost to the consumer, especially if done in an intelligent manner.

    Isn’t it more likely that manufacturing will simply move to countries like Vietnam or Malaysia?

    If those goods could be manufactured in the US and sold at the same price it would be happening now.

    What’s most likely is that the US taxpayer will be asked to pay hundreds of billions or even trillions of dollars to subsidise manufacture in the US. It will be corporate welfare on a massive scale. A few people at the top will get much much richer, the taxpayer and the consumer will get screwed.

    Has it ever worked out any other way? Do you seriously think that there are any politicians who actually give a damn about ordinary people? Looking after ordinary people is not popular with the donors who own those politicians.

    I’m amazed at the naïvete on this issue. This issue is just another opportunity for corrupt politicians and businessmen to enrich themselves. A bit like Green Energy.

    • Replies: @EldnahYm

    Isn’t it more likely that manufacturing will simply move to countries like Vietnam or Malaysia?
     
    Vietnam and Malaysia don't have the capacity(population, but land area isn't totally irrelevant either) to replace Chinese production. Also plenty of production is already in Vietnam. While there can still be some expansion, it will not be sufficient. Malaysia isn't a particularly poor country to begin with and Malays are lazy. Opening Toyota factories for example to produce cars for the American market in Malaysia is probably not a good idea.

    If those goods could be manufactured in the US and sold at the same price it would be happening now.
     
    Utter nonsense. It takes time to build up sufficient infrastructure and know how for manufacturing, and at the moment we're not even trying to do that.

    What’s most likely is that the US taxpayer will be asked to pay hundreds of billions or even trillions of dollars to subsidise manufacture in the US. It will be corporate welfare on a massive scale. A few people at the top will get much much richer, the taxpayer and the consumer will get screwed.
     
    This is based on exactly what precedent? What programs do we currently have that indicate hundreds of billions or trillions are going to be spent to subsidize manufacturing in the U.S.? When I cited an example of Japanese automakers moving production to the U.S., I wasn't just spitballing. Toyota alone has 6 factories in the U.S., including the biggest Toyota factory in the world. I would be curious to see what you are basing your predictions on. This had better be good.

    The U.S. already subsidizes world trade by the way, or didn't you notice that the United States has been busy being the world's policemen for over 70 years now?

    Has it ever worked out any other way? Do you seriously think that there are any politicians who actually give a damn about ordinary people? Looking after ordinary people is not popular with the donors who own those politicians.
     
    I never said anything about ordinary people, you're arguing with yourself here. Local politicians do care about jobs in their localities, that's why they and local businesses attempt to woo large companies into building plants. Producers care about costs, they have certainly been paying attention to the shale revolution. Your model of how the world works needs updating, to say the least.

    I’m amazed at the naïvete on this issue. This issue is just another opportunity for corrupt politicians and businessmen to enrich themselves. A bit like Green Energy.
     
    You imagine something which is amazing to you, attribute it to someone else even though it's your idea, then express amazement about it.

    Manufacturing products in the U.S. does not require replacing energy infrastructure that has 100 years of investment put into it. On the contrary, it can piggyback on energy infrastructure that we are already building. The production processes are already known as well, we do not need to learn a completely new way to do things like green energy would require.

    The increasing of wages plus aging in China is already forcing a rework of the world system. Whether politicians want this to happen or not is irrelevant. There is no third world country that can be the next China. All of this is likely to happen even without serious political instability in the world outside of North America, which I wouldn't bank on either.

    You are the naïve one here. Do you seriously expect people to be impressed when you make generic claims about crooked politicians and businessmen? Crooked politicians and businessmen don't need manufacturing to be crooked. I could make an argument that having an economy based around raw materials and finance is actually better for crooked politicians and businessmen than manufactured goods. But I won't bother because it's besides the point.
  154. @Rosie

    Bringing back manufacturing is about Populism, not Socialism.
     
    https://image.shutterstock.com/image-vector/hand-drawn-female-hands-w-260nw-1054445126.jpg

    This urgently requires the elimination of the failed Common Core curriculum.
     
    Don't even get me started. The only thing wrong with common core is that it is, essentially, a gifted program. It doesn't work for average students, and if you're not willing to separate gifted students, you can't use it at all.

    The only thing wrong with common core is that it is, essentially, a gifted program.

    Funny, what little I know about it says that it’s a program for morons.  For instance, Common Core “math” instruction teaches multiplication by drawing and counting rectangles of dots (“stacking”, the normal method of multiplication, is strongly condemned).  I’ve read that this is the method used in Haiti, drilling things into literal morons.

  155. @dfordoom

    Many manufactured goods probably could be brought back with little cost to the consumer, especially if done in an intelligent manner.
     
    Isn't it more likely that manufacturing will simply move to countries like Vietnam or Malaysia?

    If those goods could be manufactured in the US and sold at the same price it would be happening now.

    What's most likely is that the US taxpayer will be asked to pay hundreds of billions or even trillions of dollars to subsidise manufacture in the US. It will be corporate welfare on a massive scale. A few people at the top will get much much richer, the taxpayer and the consumer will get screwed.

    Has it ever worked out any other way? Do you seriously think that there are any politicians who actually give a damn about ordinary people? Looking after ordinary people is not popular with the donors who own those politicians.

    I'm amazed at the naïvete on this issue. This issue is just another opportunity for corrupt politicians and businessmen to enrich themselves. A bit like Green Energy.

    Isn’t it more likely that manufacturing will simply move to countries like Vietnam or Malaysia?

    Vietnam and Malaysia don’t have the capacity(population, but land area isn’t totally irrelevant either) to replace Chinese production. Also plenty of production is already in Vietnam. While there can still be some expansion, it will not be sufficient. Malaysia isn’t a particularly poor country to begin with and Malays are lazy. Opening Toyota factories for example to produce cars for the American market in Malaysia is probably not a good idea.

    If those goods could be manufactured in the US and sold at the same price it would be happening now.

    Utter nonsense. It takes time to build up sufficient infrastructure and know how for manufacturing, and at the moment we’re not even trying to do that.

    What’s most likely is that the US taxpayer will be asked to pay hundreds of billions or even trillions of dollars to subsidise manufacture in the US. It will be corporate welfare on a massive scale. A few people at the top will get much much richer, the taxpayer and the consumer will get screwed.

    This is based on exactly what precedent? What programs do we currently have that indicate hundreds of billions or trillions are going to be spent to subsidize manufacturing in the U.S.? When I cited an example of Japanese automakers moving production to the U.S., I wasn’t just spitballing. Toyota alone has 6 factories in the U.S., including the biggest Toyota factory in the world. I would be curious to see what you are basing your predictions on. This had better be good.

    The U.S. already subsidizes world trade by the way, or didn’t you notice that the United States has been busy being the world’s policemen for over 70 years now?

    Has it ever worked out any other way? Do you seriously think that there are any politicians who actually give a damn about ordinary people? Looking after ordinary people is not popular with the donors who own those politicians.

    I never said anything about ordinary people, you’re arguing with yourself here. Local politicians do care about jobs in their localities, that’s why they and local businesses attempt to woo large companies into building plants. Producers care about costs, they have certainly been paying attention to the shale revolution. Your model of how the world works needs updating, to say the least.

    I’m amazed at the naïvete on this issue. This issue is just another opportunity for corrupt politicians and businessmen to enrich themselves. A bit like Green Energy.

    You imagine something which is amazing to you, attribute it to someone else even though it’s your idea, then express amazement about it.

    Manufacturing products in the U.S. does not require replacing energy infrastructure that has 100 years of investment put into it. On the contrary, it can piggyback on energy infrastructure that we are already building. The production processes are already known as well, we do not need to learn a completely new way to do things like green energy would require.

    The increasing of wages plus aging in China is already forcing a rework of the world system. Whether politicians want this to happen or not is irrelevant. There is no third world country that can be the next China. All of this is likely to happen even without serious political instability in the world outside of North America, which I wouldn’t bank on either.

    You are the naïve one here. Do you seriously expect people to be impressed when you make generic claims about crooked politicians and businessmen? Crooked politicians and businessmen don’t need manufacturing to be crooked. I could make an argument that having an economy based around raw materials and finance is actually better for crooked politicians and businessmen than manufactured goods. But I won’t bother because it’s besides the point.

  156. @dfordoom

    Part of protecting citizens from foreign exploitation is ensuring that essential goods are produced locally to guarantee they are available during a crisis.
     
    I’m going to suggest a few points that will probably provoke howls of outrage, but whatever.

    1. Manufacturing industry is largely irrelevant when it comes to fighting a virus outbreak like COVID-19. A month or so ago everybody thought ventilators were the answer and were bewailing the fact that American factories were not churning out tens of thousands of ventilators. Evidence is now accumulating that for treating this virus ventilators may be entirely useless or even harmful. And in any case that huge number of ventilators were never needed anyway and would never have been available in time. If American factories had churned out 100,000 extra ventilators the ventilators would have ended up sitting in warehouses and eventually being junked.

    To fight a virus outbreak you need a competent government, not manufacturing capacity.

    2. Rebuilding manufacturing industry would be extremely costly and would mean consumers paying much higher prices. Living standards would fall sharply. Most people would be worse off.

    3. Rebuilding manufacturing industry would distort and disrupt an already damaged economy and could cause economic disaster.

    4. Manufacturing industry would require massive protection. This would trigger all-out economic warfare with China and with the US economy in its present state there's no guarantee the US would win such an economic war. Such an economic war would also turn the whole of Asia against US.

    5. The idea of bringing back manufacturing is based on an illusion. The 50s were a golden age. We had lots of manufacturing industry in the 50s. Therefore if we rebuild manufacturing the golden age of the 50s will return. But it won't. The 50s was a golden age in many ways but the 50s are not coming back. You can't recreate the past because it's now a different world.

    6. This obsession with manufacturing industry is just electioneering. Trump and the GOP are desperate and they're clutching at straws to stave off defeat in November.

    7. This is another example of the right's obsession with finding simplistic answers to complex problems. Trying to rebuild the manufacturing sector might well wreck an already fragile economy. In the real world simplistic solutions don't work.

    Rebuilding manufacturing industry would be extremely costly and would mean consumers paying much higher prices.

    There are examples which prove this false.  Generac is my favorite.  Generac sent its manufacturing to China, closing a plant in (I think) Wisconsin.  However, the loss of quality and issues with communications and time lags led Generac to bring the work back to the USA.  But not to the old plant; Generac automated many steps and the new plant employs something like 20% of the previous headcount.  Of course, quality of the operations which have been automated is uniformly high, and Generac no longer has issues with communications or shipping lags.  It also has about 5x the productivity.

    Things seem to be going well for Generac; my neighbors on both sides have Generac standby units.

    • Replies: @iffen
    But not to the old plant; Generac automated many steps and the new plant employs something like 20% of the previous headcount.

    We should "force" innovation and productivity increases. When the choice is going with cheaper labor instead of investment in productivity, cheap labor wins every time.
  157. @res
    Thanks. It looks like this page is the original source and it has a good bit more discussion.
    https://www.aier.org/article/u-s-dollar-supremacy-could-quickly-fade/

    It's interesting that that article is from 2019, while here is a very similar graphic from a 2015 blog post:
    http://blog.zorangagic.com/2015/10/global-reserve-currencies-since-1450.html
    That post has an image which makes a provocative juxtaposition with yours.

    http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2014/09/20140912_USANo2_0.jpg

    But this page indicates that in 2017 the US was 24.3% of world GDP with China at 14.8%.
    https://foreignpolicy.com/2017/02/24/infographic-heres-how-the-global-gdp-is-divvied-up/

    https://foreignpolicy.com/wp-content/uploads/2017/02/world-gdp-41ff.png

    Hey res,

    Thanks for the excellent comment and links.

    I do find this chart to be most interesting…

    Provocative juxtaposition indeed.

  158. @Mr. Rational

    Rebuilding manufacturing industry would be extremely costly and would mean consumers paying much higher prices.
     
    There are examples which prove this false.  Generac is my favorite.  Generac sent its manufacturing to China, closing a plant in (I think) Wisconsin.  However, the loss of quality and issues with communications and time lags led Generac to bring the work back to the USA.  But not to the old plant; Generac automated many steps and the new plant employs something like 20% of the previous headcount.  Of course, quality of the operations which have been automated is uniformly high, and Generac no longer has issues with communications or shipping lags.  It also has about 5x the productivity.

    Things seem to be going well for Generac; my neighbors on both sides have Generac standby units.

    But not to the old plant; Generac automated many steps and the new plant employs something like 20% of the previous headcount.

    We should “force” innovation and productivity increases. When the choice is going with cheaper labor instead of investment in productivity, cheap labor wins every time.

    • Replies: @dfordoom

    We should “force” innovation and productivity increases. When the choice is going with cheaper labor instead of investment in productivity, cheap labor wins every time.
     
    That will all be covered in the Five Year Plan comrade.

    It's kind of heart-warming to see so many on the right embracing sound Marxist-Leninist principles. Lots of economic central planning. It's always worked before. If you don't believe me, ask Stalin. It's the only way to beat the ChiCaps (the evil Chinese capitalists).

    I did make a prediction that the CV crisis would discredit the Economic Right and would be the end of economic libertarianism. It's all coming true. The idea of economic autarky is great. We could call it Socialism In One Country.

    Of course there will be problems with Wreckers and Capitalist Roaders and Right Deviationists but they will be dealt with. People here on UR have already made some useful suggestions, such as a program of concerted lying by the government. Those suggestions have been passed on to the People's Commissar for Propaganda.

    The future is going to be awesome.
  159. @iffen
    But not to the old plant; Generac automated many steps and the new plant employs something like 20% of the previous headcount.

    We should "force" innovation and productivity increases. When the choice is going with cheaper labor instead of investment in productivity, cheap labor wins every time.

    We should “force” innovation and productivity increases. When the choice is going with cheaper labor instead of investment in productivity, cheap labor wins every time.

    That will all be covered in the Five Year Plan comrade.

    It’s kind of heart-warming to see so many on the right embracing sound Marxist-Leninist principles. Lots of economic central planning. It’s always worked before. If you don’t believe me, ask Stalin. It’s the only way to beat the ChiCaps (the evil Chinese capitalists).

    I did make a prediction that the CV crisis would discredit the Economic Right and would be the end of economic libertarianism. It’s all coming true. The idea of economic autarky is great. We could call it Socialism In One Country.

    Of course there will be problems with Wreckers and Capitalist Roaders and Right Deviationists but they will be dealt with. People here on UR have already made some useful suggestions, such as a program of concerted lying by the government. Those suggestions have been passed on to the People’s Commissar for Propaganda.

    The future is going to be awesome.

    • LOL: Cloudbuster
    • Replies: @iffen
    It’s kind of heart-warming to see so many on the right embracing sound Marxist-Leninist principles.

    I'm not right wing.

    Lots of economic central planning.


    I'm not a commie either, although it really hasn't been ...

    Not central planning. Just setting conditions. Deny access to sources of cheap labor and entrepreneurs and capitalists will have no choice but to innovate and invest in increasingly productive machinery.
  160. iffen says:
    @dfordoom

    We should “force” innovation and productivity increases. When the choice is going with cheaper labor instead of investment in productivity, cheap labor wins every time.
     
    That will all be covered in the Five Year Plan comrade.

    It's kind of heart-warming to see so many on the right embracing sound Marxist-Leninist principles. Lots of economic central planning. It's always worked before. If you don't believe me, ask Stalin. It's the only way to beat the ChiCaps (the evil Chinese capitalists).

    I did make a prediction that the CV crisis would discredit the Economic Right and would be the end of economic libertarianism. It's all coming true. The idea of economic autarky is great. We could call it Socialism In One Country.

    Of course there will be problems with Wreckers and Capitalist Roaders and Right Deviationists but they will be dealt with. People here on UR have already made some useful suggestions, such as a program of concerted lying by the government. Those suggestions have been passed on to the People's Commissar for Propaganda.

    The future is going to be awesome.

    It’s kind of heart-warming to see so many on the right embracing sound Marxist-Leninist principles.

    I’m not right wing.

    Lots of economic central planning.

    I’m not a commie either, although it really hasn’t been …

    Not central planning. Just setting conditions. Deny access to sources of cheap labor and entrepreneurs and capitalists will have no choice but to innovate and invest in increasingly productive machinery.

    • Replies: @Audacious Epigone
    Necessity is the mother of invention (or innovation, as other renditions have it).
    , @dfordoom

    Not central planning. Just setting conditions. Deny access to sources of cheap labor and entrepreneurs and capitalists will have no choice but to innovate and invest in increasingly productive machinery.
     
    That certainly sounds central planning-ish to me.

    Would you agree that if you protect manufacturing industry with tariffs or with subsidies (handouts from the taxpayer) then you'll end up with a very inefficient manufacturing industry because it will have no incentive to become efficient?

    And if you believe that a revived manufacturing sector will not lobby successfully to gain access to cheap labour I have a bridge to sell you.

    Also, the innovation you're relying on will cost money. How many corporations will be willing to risk that kind of outlay without a guarantee that they're going to get protection, in the form of tariffs or subsidies?

    I think you're being amazingly and naïvely optimistic. A thriving manufacturing sector is a nice dream (albeit a dream that is 60 years out of date), but I suspect it will turn out to be just that, a dream. The best you can hope for is an orgy of corporate welfare accompanied by even greater levels of governmental corruption. And in all probability, more bureaucracy.

    And stand by to be told that the number one priority for the new revived manufacturing industry will be a commitment to diversity, affirmative action, social justice and renewable energy.
  161. @iffen
    It’s kind of heart-warming to see so many on the right embracing sound Marxist-Leninist principles.

    I'm not right wing.

    Lots of economic central planning.


    I'm not a commie either, although it really hasn't been ...

    Not central planning. Just setting conditions. Deny access to sources of cheap labor and entrepreneurs and capitalists will have no choice but to innovate and invest in increasingly productive machinery.

    Necessity is the mother of invention (or innovation, as other renditions have it).

    • Replies: @Mr. Rational
    I'm not sure it's even necessity.  It's certainly possible today to find labor to pick lettuce and fruit and run grills, but we've already got a semi-automated lettuce picker which cuts heads with a water jet and lets the packers work in the shade, robotic fruit-pickers on the way and Flippy the grillbot which can crank out perfectly-done patties faster than humans can dress the results on the buns.  Just plain cheaper, tomorrow if not already today.
  162. @Audacious Epigone
    Necessity is the mother of invention (or innovation, as other renditions have it).

    I’m not sure it’s even necessity.  It’s certainly possible today to find labor to pick lettuce and fruit and run grills, but we’ve already got a semi-automated lettuce picker which cuts heads with a water jet and lets the packers work in the shade, robotic fruit-pickers on the way and Flippy the grillbot which can crank out perfectly-done patties faster than humans can dress the results on the buns.  Just plain cheaper, tomorrow if not already today.

  163. @Tusk
    I've seen basic products (milk, pasta) all go up 25% in the past few months, and it certainly won't come down.

    We are still paying $2,99 per gallon for milk in downtown los angeles, though most stores charge more.

    Still paying max $1 per pound of pasta, though that has gotten harder to find and i sometimes forgo buying pasta till i can find that price (sometimes online). Many people are apparently paying $1.49 to $2 per pound of pasta.

  164. @iffen
    Rosie says:
    April 29, 2020 at 1:27 pm GMT • 100 Words


    • Agree: iffen, AaronB

    The end is nigh.

    i will note my agreement with Rosie as well. The end could be mere minutes away now.

  165. @iffen
    It’s kind of heart-warming to see so many on the right embracing sound Marxist-Leninist principles.

    I'm not right wing.

    Lots of economic central planning.


    I'm not a commie either, although it really hasn't been ...

    Not central planning. Just setting conditions. Deny access to sources of cheap labor and entrepreneurs and capitalists will have no choice but to innovate and invest in increasingly productive machinery.

    Not central planning. Just setting conditions. Deny access to sources of cheap labor and entrepreneurs and capitalists will have no choice but to innovate and invest in increasingly productive machinery.

    That certainly sounds central planning-ish to me.

    Would you agree that if you protect manufacturing industry with tariffs or with subsidies (handouts from the taxpayer) then you’ll end up with a very inefficient manufacturing industry because it will have no incentive to become efficient?

    And if you believe that a revived manufacturing sector will not lobby successfully to gain access to cheap labour I have a bridge to sell you.

    Also, the innovation you’re relying on will cost money. How many corporations will be willing to risk that kind of outlay without a guarantee that they’re going to get protection, in the form of tariffs or subsidies?

    I think you’re being amazingly and naïvely optimistic. A thriving manufacturing sector is a nice dream (albeit a dream that is 60 years out of date), but I suspect it will turn out to be just that, a dream. The best you can hope for is an orgy of corporate welfare accompanied by even greater levels of governmental corruption. And in all probability, more bureaucracy.

    And stand by to be told that the number one priority for the new revived manufacturing industry will be a commitment to diversity, affirmative action, social justice and renewable energy.

    • Replies: @Mr. Rational

    That certainly sounds central planning-ish to me.
     
    You think the USA had central planning from the Articles of Confederation?  You really don't grasp this subject well, do you?
  166. @dfordoom

    Not central planning. Just setting conditions. Deny access to sources of cheap labor and entrepreneurs and capitalists will have no choice but to innovate and invest in increasingly productive machinery.
     
    That certainly sounds central planning-ish to me.

    Would you agree that if you protect manufacturing industry with tariffs or with subsidies (handouts from the taxpayer) then you'll end up with a very inefficient manufacturing industry because it will have no incentive to become efficient?

    And if you believe that a revived manufacturing sector will not lobby successfully to gain access to cheap labour I have a bridge to sell you.

    Also, the innovation you're relying on will cost money. How many corporations will be willing to risk that kind of outlay without a guarantee that they're going to get protection, in the form of tariffs or subsidies?

    I think you're being amazingly and naïvely optimistic. A thriving manufacturing sector is a nice dream (albeit a dream that is 60 years out of date), but I suspect it will turn out to be just that, a dream. The best you can hope for is an orgy of corporate welfare accompanied by even greater levels of governmental corruption. And in all probability, more bureaucracy.

    And stand by to be told that the number one priority for the new revived manufacturing industry will be a commitment to diversity, affirmative action, social justice and renewable energy.

    That certainly sounds central planning-ish to me.

    You think the USA had central planning from the Articles of Confederation?  You really don’t grasp this subject well, do you?

    • Replies: @dfordoom

    You think the USA had central planning from the Articles of Confederation?
     
    If the government is trying to influence the economy to the extent of deciding to artificially revive certain sectors (such as manufacturing), if the government is deciding that it needs to take action to change the shape and the nature of the economy, then I think that qualifies as a degree of economic central planning. If the government decides that government action rather than the market should determine which industries should exist, then I think that qualifies as a degree of economic central planning.

    I'm not saying that economic central planning is necessarily good or bad I'm just amused that so many on the far right are now converts to that concept. And I'm very amused that so many on the far right who have been saying for years that they don't trust the government are now inclined to entrust their economic future to that same government.

    But since the US Government is renowned for its honesty, integrity and sound judgment, and its absolute incorruptibility, what could possibly go wrong? Look at how honest and efficient the whole system of defence procurement is.
  167. @Mr. Rational

    That certainly sounds central planning-ish to me.
     
    You think the USA had central planning from the Articles of Confederation?  You really don't grasp this subject well, do you?

    You think the USA had central planning from the Articles of Confederation?

    If the government is trying to influence the economy to the extent of deciding to artificially revive certain sectors (such as manufacturing), if the government is deciding that it needs to take action to change the shape and the nature of the economy, then I think that qualifies as a degree of economic central planning. If the government decides that government action rather than the market should determine which industries should exist, then I think that qualifies as a degree of economic central planning.

    I’m not saying that economic central planning is necessarily good or bad I’m just amused that so many on the far right are now converts to that concept. And I’m very amused that so many on the far right who have been saying for years that they don’t trust the government are now inclined to entrust their economic future to that same government.

    But since the US Government is renowned for its honesty, integrity and sound judgment, and its absolute incorruptibility, what could possibly go wrong? Look at how honest and efficient the whole system of defence procurement is.

  168. If the government is trying to influence the economy to the extent of deciding to artificially revive certain sectors (such as manufacturing), if the government is deciding that it needs to take action to change the shape and the nature of the economy, then I think that qualifies as a degree of economic central planning.

    The USA had what you’re calling “economic central planning” from its inception.  The FedGov was financed mostly by tariffs up until 1913.  This was not economic planning, it was a revenue measure and preference for domestic industry over foreign.  This doesn’t “plan” a thing, but it is somewhat of a national security measure.

    But since the US Government is renowned for its honesty, integrity and sound judgment, and its absolute incorruptibility, what could possibly go wrong?

    Tariffs are transparent.  This is probably why the corrupt people who created the Fed and the income tax hate them so much.

  169. @Achmed E. Newman
    Nobody against Socialism is screaming with multiple exclamation points about Russia and China. Do you mean the USSR of and Red China of 30 and 40 years ago, respectively, Curmudgeon?

    Socialists expect people to work, but understand in some circumstances they need help. Sometimes the help needed will be longer term, depending on the circumstances.
     
    As do Libertarians. The difference is that Libertarians (along with true Conservatives) know that government handouts are not any real form of charity. That means they come with corruption, no regard for the outcome of said "charity", and no control of the spending of others' involuntary "charity". This is what Socialists either are too dense to get, have no experience in the real world with, or purposefully ignore, to get their plans implemented.

    Real socialists are opposed to high immigration rates.
     
    As are plenty of Libertarians. Just as with Socialists though, lots, if not most, of them in America are just deluded fools, thinking that one can have a Libertarian Society or a half-way-decent (not every likely either way) Socialist system, with the type of people who have been allowed to enter from lands most foreign.

    BTW, I will try to get through the whole of the article you linked to. It's a long one, and I'm sure I'll come up with too many refutations to even remember by the time I'm done. ;-}

    I agree completely with your last paragraph, except for the chagrin part. She may make a good wife compared to lots of feminist American women, but that depends on how long she's been exposed here. Hopefully her parents will have to go back. "Sorry, Trump and all. See you later. We'll send some non-poisonous baby formula for the nephew. Buh-bye."

    .

    PS: Ask your man Bernie about high immigration rates. I think he'll just pretend he didn't hear you.

    The problem I see with Libertarians and Conservatives is that they pretend that there is an edict somewhere that says everything has to be owned privately. They also conflate ownership with management.
    I’ve seen plenty of local businesses, that have been around for generations, go under because the family members taking over either aren’t prepared to do what (great) grampa did to make the company a success, or that they want to alter the business model that was successful. In short, bad management.
    I’m not going to pretend that governments are free from corruption, but it is naive to think corporations and small businesses are not, or cannot be.
    If people pay into something through taxation, and at sometime in their life need to collect on what they’ve paid into, it’s not a handout. Unemployment benefits are an insurance scheme, not a handout. Welfare may be a handout, but towns and cities over 200 years ago budgeted for help for the destitute, it’s nothing new.
    As for libertarians being opposed to immigration, they are as scarce as rocking horse shit. Immigration has always been used to suppress wages and working conditions. What puzzles me is why libertarians and conservatives think its perfectly okay for business interests to create business groups to further their goals, but are adamantly opposed to working people doing the same.
    Bernie ain’t my man. He’s a fraud and always has been.

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