Ron Paul vs. the Federal Reserve

Right Side News ^ | January 10, 2011 | Strapado Wrack

[DManA]

I understand your sarcasm.

We need to establish conditions that are favorable to wealth creation. What those conditions are is not controversial.

[DannyTN]

Are you a big, big fan of the Section 8, Single mom with multiple father, public housing slum welfare state? How do you think it can exist without big gov? It can't. Forget the banks, think of what the finance ability of government does to welfare, make plantation slaves of first the weakest citizens, and then up the economic ladder. And when does it stop. Not for money reasons, but moral reasons. And if you de moralize a population, what do you think happens? Imagine a nation totally Detroitized. And that is my true reason for getting rid of the Fed. The money is the disease. The government is bad for people.

So government is bad, and your goal in bringing down the FED is to bring down government? Bankrupt the nation and then welfare will stop because we can't afford it?

First, if you are against welfare, or welfare as it's now implemented, then you should work to change that. The collateral damage in bringing down an entire government just to reform welfare is not warranted. There is no guarantee that what government rises from the ashes won't have even worse policies, nor is there any guarantee that what rises will even be democracy based.

Secondly, State responsibility of the poor and indigent has been recognized since at least Old Testament times. It was considered a civic duty by our fore fathers, but until the introduction of Medicaid, it was handled at the state level. History of welfare

Third, abolishing the FED is not likely to bring down the government or even stop government borrowing. It would hurt the economy at large, and therefore reduce Federal Revenues. It would not stop the government from borrowing. It could make monetary policy a little more difficult, although through history governments have found ways of devaluing metal based currencies. And frankly, it only takes a majority vote in the house to come off of a gold based standard like we did in the Civil War. So any sense of security is false.

[Toddsterpatriot]

And you are free to believe the CPI accurately measures inflation.

What is the correct measure of inflation?

[Mtner77]

....”the entire political career of Ron Paul is an inspiration for any citizen who values liberty and defends the U.S. Constitution.”....

WOW! That is absolutely one of the smartest things ever posted here on FR.

I am in awe.

Congrats. You are THE MAN! You are THE BOMB!

WOW! What insight!

I thought FR was going to start banning these idiots?

[IbJensen]

Perhaps the banning should start with those who type prattle and wouldn’t know a right-winger from Rep. Wiener.

[Mtner77]

ZING!!

LMAO!

You want to post a thread asking why “Dr. Paul.” is weird? (And I guess expect what, happy congrats from real consevatives?)

You nutcakes are just burning bandwith.

“Dr. Paul” will be elected president about the same time both of you are.

But look. I hate to laugh. (Too much). So I will just wish you lil’ boys “good luck” on your quest to have a liberal elected president. The only “commies” here are perhaps the ones that support a “commie”. You get the type. Let’s surrender! 9-11 was an “inside” job.

What is “weird about Ron Paul”?

Well, only 96% of TRUE republicans have figured it out.

But you keep at it guys. You are JUST a “hair” from changing all the rest of our minds here.

Remember when I said I would not laugh “too much”. I lied.

[Leisler]

Maybe the one used before they took out the price of energy, food, used cars..... You know, the stuff people buy.

( Guess which way the numbers would go? )

Good thing they took out used cars because Cash for clunkers, a program paid for by government debt, raised used car prices( a threefer of economic destruction. You destroy real assets, raise the price of remaining assets, and go into debt. )

For instance the Congress and the Federal Reserve bank printing trillions of dollars....that’s not inflationary?

[Leisler]

Dan, here is a recent, public article by the Federal Reserve President of the Dallas Federal Reserve stating that Bernanke/Congress are now threatening the economic foundations, what’s left of them, of America.

http://www.dallasfed.org/news/speeches/fisher/2011/fs110112.cfm

[Toddsterpatriot]

Maybe the one used before they took out the price of energy, food, used cars..... You know, the stuff people buy

Sounds like CPI-U.

Source

[DannyTN]

Great speech. I strong agree with him on government irresponsibility being the issue not the FED...

"Those lawmakers who advocate “Ending the Fed” might better turn their considerable talents toward ending the fiscal debacle that has for too long run amuck within their own house. The Fed does not create government debt; fiscal authorities do. Deficits and the unfunded liabilities of Medicare and Social Security are not created by the Federal Reserve; they are the legacy of those who control the purse strings―the Congress, working with the president. The Fed does not earmark taxpayer money for pet projects in local communities that taxpayers themselves would never countenance; only the Congress does that. The Congress and administration play the dominant role in creating the regulatory environment that incentivizes or discourages job creation. "

I somewhat dissagree with him on the role of taxation and regulation in the export of jobs overseas. While that can certainly play a role, he fails to mention the impact of giving open access to our markets and failing to get the same in return. Our the impact on our economy of trading with countries that only have excess labor to offer when our own employment is less than full. We could remove all taxation and regulations and still not be able to compete with China's wage of $2/day.

China is a government controlled economy, those are slave wages. The dollars are not allowed to return to the US economy to buy goods, but rather are focused into buying our debt and into buying military strategic and economically strategic companies.

It's not in the US interest to do that much trade with China. The costs to the US are larger than the price difference that the consumer sees.

[Leisler]

Thanks.

Am I reading this right?

All items (1967=100) - (Nov 2010) 655.438

That since 1967 prices are up five and a half times?

http://www.bls.gov/news.release/cpi.t01.htm

[Toddsterpatriot]

That since 1967 prices are up five and a half times?

That is what the report shows. About 4.06% compounded over 43 years.

[Leisler]

This gets back to my feelings that the Fed is the enabler.

That Fedgov would of long since hit the wall, either in the bond fund, or voting booth. Certainly right now where the Fed is buying so many Treasury notes, and being the trash can for trash Fannie/Freddie so called ‘securities’.

Anyway, is it still your notion that the Fed is ‘independent’? Or is it a political player?

[getsoutalive]

Borrowing increases the money supply, even under the gold standard.

Care to explain this statement, absent fractional reserve banking, which while legal today, is quite obviously fraudulent?

Thanks

[Leisler]

So, a common saving account, a CD, after taxes, most likely doesn’t earn any real income at all, and my well over time lose value?

What do you think the governments would feel about income adjusted for inflation? I suppose they wouldn’t like that.

[getsoutalive]

Don't talk to me about the moral hazard of bailing out the banking system from temporary short term liquidity crises, until you can explain how to prevent the panics and depressions of the 1800's when we were on a gold standard.

Three words. Fractional. Reserve. Banking.

Paper, gold, rocks, whatever you might choose as money, will always be affected by the fraud that allows banks to lend out the money they promise to provide you upon demand.

A "bank run" is nothing more and nothing less than the fraud of fractional reserve banking being exposed. It is inevitable, as we are about to find out, not even the most powerful central bank in the world can hide the fraud forever.

With an honest banking system, bank runs cannot occur. Because the money you deposited is really there when you wish to access it. There would only be a panic in the event of fraud or other criminal activity.

[Leisler]

That is true.

Lets go back to, if there every was one, a time when there was no money.

You got a hoe. It’s by the door of your cave. Og down the street, want’s to borrow the hoe, which you are not using to hoe his hops patch, and not only will he increase his hops production, but he will bring you your hoe back, but some beer too.

Now let’s complex it a bit and say there is money, it is sea shells. Og rents the hoe, for some sea shells. ( The amount of sea shells in the tribe is the same ). However Og takes his beer down to the sea tribe to get shells for beer. He returns with a bunch of shells, and your wife now yells at you that Og has all sorts of shells to spend on his wife why don’t you go trade some beer for shells.
( Now the money supply has increased in the cave village.)

( I really think women are the source of inflation. We were happy in our cave with beer, then they ruined it. )

[Toddsterpatriot]

Borrowing increases the money supply, even under the gold standard.

Care to explain this statement

Sure.

absent fractional reserve banking

Why would I explain it absent fractional reserve banking?

M1 includes currency in circulation and demand deposits.

You deposit 10 $20s in the bank. The banks loans out 9 $20s and keeps one in reserve. The money supply is your checking account ($200) plus the $180 that is in circulation. The money supply grows by $180 whether your $20s are gold coins, gold certificates or FRNs.

which while legal today, is quite obviously fraudulent?

Please explain how accepting deposits and making loans from those deposits is "obviously fraudulent".

Thanks.

[Toddsterpatriot]

So, a common saving account, a CD, after taxes, most likely doesn’t earn any real income at all, and my well over time lose value?

A CD over the last 43 years would have easily kept up with inflation.

What do you think the governments would feel about income adjusted for inflation?

Reagan felt strongly enough that our tax brackets are now adjusted for inflation.

[Captain Kirk]

With the exception of the government-generated inflation of the War of 1812 and the Civil War, your chart shows comparative stability of prices from 1810 to 1910. Not especially the almost totally flat nature of prices between 1870 and 1910. We have not even close to that level of price stability since.