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Gold-Eagle

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Inexhaustible Austrian's profile photoDavid Sager's profile photo
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Deep Thoughts memes
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I'm new to economics.   Just noticed this comment on another web site in regard to money and "what Austrians fail to understand":

"1. All fiat currencies are backed by the productive capability of the nation that issues it. As long as you can trade fiats for real goods, it is "backed". 
 
2. Austrians fail to understand that the capacity to produce is a function of the circulation of currency, whether fiat or metal. Printing more fiat can mean producing more product for the fiat to chase. 
 
It is interesting that goldbugs seem to obsess on the relative value of gold to fiat. Why? Because the fiat is the real money. You can rarely trade gold for real production."

Anybody care to respond to these points?
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Anthony Good's profile photoMarcin Romaszewicz's profile photo
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Well I don't like the elasticity of paper, at the same time I don't like the purposeless mining of gold (often with environmental costs). I envision a world where businesses establish the fiat currencies.
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Alan Lovejoy's profile photoSam Marcum's profile photoArthur Brownlee IV's profile photoMartin Louis Selby's profile photo
2 comments
 
LOL! Love it :)
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Ziad Abdelnour

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I believe it is the bailout induced foreclosures that caused our now obscene wealth concentration.
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Jeff Gochenour's profile photo
 
Certainly an accident. No way it could be a planned effect of a well executed cause. Right?
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Paul Atwood

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Anyone for a good laugh?
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Sifu Mode's profile photo
 
I've heard left-ists call Greenspan a capitalist libertarian

0_o    Mind blown
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Ziad Abdelnour

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I believe the next disaster that happens will be bigger than the Fed.
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Dave Hebert's profile photoZiad Abdelnour's profile photo
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I mean... it rained pretty bad here today.  And I'm willing to bet that the volume of water that fell from the sky would more than fill all of the Fed offices.  

Was that it?
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Ziad Abdelnour

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We allow Japan to sell us millions of cars with zero import tax and we can't make a trade deal with them - our country is in big trouble!
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Mohammad Khalid

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Warren Dew's profile photo
 
Essentially he's just arguing for continued indirect aid from more developed countries.  It would be better if he would concentrate on making India's economy less dependent on aid from developed countries.
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John Hendon

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Did World War II really end the Great Depression?

According to the economic historian Dr. Robert Higgs:

"Yes, national output as conventionally measured did grow hugely during the war... [G]ross domestic product (in constant 1987 prices) increased by 84 percent between 1940 and 1944. What the orthodox account neglects, however, is that this "miracle of production" consisted entirely (and then some) of increased government spending, nearly all of it for war materials and equipment and military personnel. The private component of GDP (consumption plus investment) actually fell after 1941, and while the war lasted, private output never recovered to its pre-Pearl Harbor level. In 1943, real private GDP was 14 percent lower than it had been in 1941. If a nation produces an abundance of guns and ammunition, it does not thereby achieve genuine prosperity .Those who lived through the war ... forget the scarcity of decent housing, the hassles in commuting to work, and the severe rationing or complete absence of basic consumer goods...Because of the many other ways that the well-being of consumers deteriorated during the war, which the official data fail to capture, actual wartime conditions were even worse than [the] figures suggest." [1] 

Economist Steve Horwitz conducted research in which he finds: 

"Whatever the war’s effects on seemingly booming conventional macroeconomic aggregates, it entailed a retrogression in the average American’s living standards, and that disconnect should alert us to those aggregates’ limitations...The notion that World War II is responsible for ending the Great Depression has met growing skepticism among economic historians. Although the wartime economy saw increases in conventional measures of macroeconomic performance, the letters, journals, and newspapers of the era indicate years of continued material deprivation and hardship, rather than rising living standards for the average American." [2]

Socially useful production is driven by voluntary exchange. In the case of WWII, the government directed resources to be used towards the production of things which private citizens would never have bought (such as tanks and missiles), making such resources unavailable for the production of goods and services private citizens actually wanted, leading to intense rationing. While WWII was a necessary war, it is foolish to believe that wartime spending is good for the standard of living of the average American. 

[1] http://www.independent.org/newsroom/article.asp?id=2188
[2] http://www.independent.org/publications/tir/article.asp?a=915

#libertarian  
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Steve Jacobs's profile photoMike McDonald's profile photo
9 comments
 
NB: I wasn't making excuses for WHY we did what we did by entering the war, but I think no matter what we'd have had to enter at some point, either early or late.
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Der Chao Chen

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I am wonder if there is any research examined the role of managers through the praxeology approach? or my inquiry is an old story but I don't reach yet?
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The story and plight of Detroit may break your heart. It did ours . The question is how many more cities are on the same path. It also tells.us that GDP is a lie - the facts speak volumes for themselves.

What can make me feel  this way?

#Flight2100
This article written by Frosty Wooldridge regarding the demise and plight of the once mighty American city we fondly  refer to and recall as Motown or Motor City ,the symbol of  the nation's industrial strength , should break...
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Terry A McNeil's profile photo
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Mike Rehmeyer's profile photoEric Smith's profile photoAlex Lee's profile photoDystopianEmpire01 .'s profile photo
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"In case of prosperity..."
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Michael Revy's profile photo
 
I would add US acting counter it's interests with FATCA.  I do not see US monopoly in inter banking settlements to be worth compliance with US imposed rules.
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He's clearly smarter than a third of our politicians.

Should we raise the minimum wage?: http://youtu.be/joVFKR7VcEM
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Luis Rosales's profile photoSeth Peterson's profile photo
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Ziad Abdelnour

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People Are Seriously Talking About Banning The Banks — And It's Not As Crazy As It Sounds http://ln.is/businessinsider.com/BQgo4 …
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Dave Hebert's profile photo
 
If banks are truly creating money (as distinct from credit), then why isn't inflation much higher? There's a major difference between credit and money, as Mises described in 1912
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Jeffrey Schaben

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Discussing another spectre..
On this blog I thought I would discuss the frightening prospect of pyramiding taxes. I acknowledge that this tax pyramids in the economic model. Since the abolition of slavery, I concede that all taxes embed in the econom...
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Paul Atwood

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Its impossible to take MMT seriously.  When I read their ideas or have a discussion with a proponent of MMT I feel like I'm on an episode of Fantasy Island.  Its like talking to a schizophrenic.
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