It is fairly trivial to show that the "recouped costs" as you put it will never allow more new game sales in a market that allows used sales.
If the used game market was 100% effective, then the new games sales would be the same between the two. However, the used market is far from efficient. It drains a huge percentage of the money that goes through it into the pocket of the dealers.
What is true is that a market without used sales will allow consumers to experience a lesser amount (not necessarily quality) of content. But if you want to make that argument, then I recommend that you first put your attention towards getting rid of copyright and intellectual property laws as they have the same effect.
Hyperinflation generally happens because the government lack the ability to properly tax the amount of resources that it needs/wants.
In Weimar that happened because the government had debt denominated in gold which it couldn't repay without taxing the economy to destruction.
In the US, the debt is not a real problem as pretty much all the debt is denominated in dollars. With a 1:1 ratio between printed currency and debt repayed that isn't really a scenario for hyperinflation.
If you want to bet on hyperinflation in the US, I would go either with failure of taxing regime (USSR collapse) or collapse in production capabilities (Zimbabwe) as being more likely scenarios for hyperinflation.
And if all the work is done by robots, a government is needed more than ever, because then there will be no more economic wealth redistribution through wages.
That is something I think most people don't get. Governments naturally grow to fit the size of the available labor force after the private sector has had its share. (when it doesn't, it is called austerity and is generally a bad bad thing)
Macroeconomically speaking, any government only has 4 options:
* Pay the unemployed (large government with entitlements) * Employ the unemployed directly or indirectly (large government) * Institute max working per week and other rules to increase number of employees in the private sector (shrinks government, grows private sector) * Wait for inevitable collapse or civil war.
Whenever Marxists talk about economy they like to overstate the importance of labour and understate the importance of capital.
Umm, the whole concept of Marxism is basically based around technology causing capital to become increasingly valuable, eventually leading to the capital in a few private hands destabilizing the economy and society as a whole.
Even with competition you run into the age old problem that private companies optimize for factors that aren't efficient for government.
For a private company, firing 100 people can be a massive efficiency boost. For the government, 100 unemployed people easily ends up costing more than just employing 100 people as it has to deal with the long term consequences.
Efficiency for the government is using less imported and natural resources. Meanwhile, private companies will easily spend more on imported and natural resources as long as it means that it can employ less people.
Its worse then that, the Canadian dollar has been matching and often outpacing the US dollar for much of the time since the 2008 collapse.
The CND has pretty much the exact same relative value as it had before the 2008 collapse (1:1). The EUR has significantly less relative value (it was at 1.6 and is now 1.3).
Of course. That is basically what Keynes pointed out.
Countries grow when their politicians care about reducing unemployment and putting workers to productive use. Countries stagnate when the politicians only care about the stock market looking good.
That article claimed that super-rich people world wide have 21 trillion in assets. Suppose that's true AND we confiscate all of it.
Guess what. It's not enough. The public debt of the US, Japan and Europe combined is more than twice that, some 44 trillion.
We are broke.
For every one dollar that the federal government owes, someone owns that debt. That is a simple fact.
Fiat currencies are a basic zero sum game. The only interesting thing is the distribution as it has a real impact on the productivity of an economy. And here is where people are right to blame the government, as it is the federal government that is responsible for managing said distribution via taxes and spending.
And yes, the managing of the distribution of currency is inherently unfair. The whole point is to make it unfair in a way that best keeps the economy running well.
Well... they can get another job you say... Well the union busting plantation owners made sure that the vast majority of America's jobs abuse their employees, so you can only choose among bad options.
This is why a federal sponsored job guarantee is a much better solution than a minimum wage. A minimum wage only sets a lower limit for how much someone will get paid. It doesn't set a lower limit for how that person will be treated, or the likely-hood of getting a job in the first place.
Sure, you could use an income guarantee or social safety net instead. But considering most people don't like other people "exploiting welfare", isn't it better to let people work for a living instead.
Sure, job guarantee jobs would probably not be the most productive, but then again, most minimum wage jobs aren't that productive either. (if they were, then they wouldn't be minimum wage)
Also, the job guarantee would act as an automatic stabilizer, increasing the amount of currency inflow into the economy when private sector labor demand decreases, and decreasing it when the the labor demand increases.
I guess some people don't like that it would be possible to stay in the job guarantee instead of "taking a really job", but that is missing the point. In addition to providing employment of last resort, the job guarantee is supposed to be the lower bound of what is considered an acceptable work place in a modern society. If a company in the private sector can't compete with that, then the problem isn't really with the job guarantee, but with the company.
GDP per capita is twelfth in the nation, so apparently those protections come at a very high cost
There are a total of two "right to work" states with higher GDP/capita than California. There are about 20 with lower.
Really, why did you have to bring up GDP. Don't you have the basic neoliberal playbook in front of you. I am fairly certain that there is a rule in there about never mentioning GDP. Much better to mention "Purchasing Power" or "Net salary" that explicitly leaves out a good part of the government contribution to the economy. That way you can properly inflate the value of economies with small governments.
Maybe your life is about risk and reward. Why force that onto everyone?
Because if he doesn't, he would have to gamble his life in a game with a bunch of sociopaths that won't hesitate to stab him in the back.
Much easier to trick a bunch of social people to join the game so that that there will be more fodder for the knife stabbing.
That has always been the core idea behind neoliberalism. Survival of the fittest, where the fittest of course are those who decide the rules of the game.
You haven't answered the most important question: how is the trillion dollars removed from the money supply?
There is no removal or adding. Monetary wise, the whole trillion dollar coin is a zero sum maneuver. You just replace one monetary asset (bonds) with another monetary asset (coin).
Politically it has larger meaning. The biggest one is that it explicitly demonstrates the economic sovereignty of the US government as spelled out in the constitution, by pointing out that the debt limit is a nowadays pointless construct remaining from the gold standard era. Also, it prevent fiscal gridlock by insane politicians. And anything that prevents utter stupidity by insane politicians is a good thing in my opinion.
Governments printing money to pay their debts is nothing new. It has a long history indeed. And I don't think there is a single major example where inflation did not soon follow. Often hyper-inflation in fact.
Actually, you will find extremely few examples of governments printing money to pay their internally denominated fiat currency debts. Which is fairly understandable. Bonds in an economically sovereign fiat currency are as trustworthy as pure cash, making it counterproductive to hold cash instead of bonds unless you need immediate access to the cash.
And if such a government does do it, there is pretty much no inflation as bonds and cash are so similar in a sovereign fiat economy as mentioned above. I say pretty much, as it should be obvious that if you have to hold dollars instead of bonds, then you are more likely to spend them into the economy, which will heat up the economy and hence lead to
Most of the "monetizing the debt" hysteria comes from historical examples with foreign denominated debt (including gold). There are countless examples of why printing money to pay back foreign denominated debt can lead to hyper inflation.
It would help them by not having to pay interest on some of the outstanding tax credits (that is all dollars are) and by not having to deal with a debt limit that was instituted when the US dollar was a gold standard and hence under real spending constraints.
. How would they remove a trillion dollars from circulation anyway?
What happens is that the treasury deposits the coin at the fed, thereby getting a huge surplus on its accounts (yes, it is just numbers on an account that the fed can create with a keystroke) that it can use to repay bonds if it wants to when it wants to. This coincidently ensures that the US dollar maintains a high rating, by demonstrating that the the whole "US government can repay all its debts" is explicitly true and not under any kind of political debt limit whim.
This doesn't really cause any inflation that didn't already exist, because all you are doing is trading one tax liability with interest (bonds) for another tax liability without interest (virtual numbers on an account).
You could argue for a small coincidental inflation as the lessened amount of available bonds encourages people holding US tax credit notes to spend them immediately instead of putting them into bonds (although only if the government repays bonds hold by the foreign or private sector. Those held by itself should have no impact). As the economy is not running at full capacity at the moment, any such inflation would be minimal however. And the increased currency spending would also increase tax incomes, thereby reducing the need to remove further bonds from the market.
And why would hyperinflation happen if you replaced interest carrying currency with non-interest carrying currency? If anything, the government would pay less interest, thereby decreasing the total amount of currency that enters the private sector, which in turn would reduce inflation.
I am not going to say something about how weak or strong the dollar is. I just wanted to point out that bond yields are not indicative of the strength of a sovereignly controlled fiat currency.
The US government can always print money to cover the bond repayments. As long as a bond holder has use for US dollars, they therefore represents a very safe investment. And as long as there are no foreign denominated debts involved (if there were, you couldn't really call US sovereign), said printing won't have a negative impact on the internal economy either.
In fact, from what I understand of how things work in practice, it is more or less the federal reserve that sets the bond interest rates, not the bond holders
As government debt is equivalent to private sector savings (ignoring foreign savings for simplicity), it is fairly easy to see why governments run near permanent deficits.
As the economy grows, the private sector tends to want to save more. Hence, only the government is left to take on the debt (unless you want to involve the foreign sector and run a massive foreign trade surplus, but that is just moving the problem up to the international level instead as it is basically a zero sum problem)
That said, there is no reason to pay interest on all that debt. To allow more private sector savings, the government can issue currency with or without interest. However, the same people who whine about the debt tend to also complain about "monetizing the debt" (a.k.a. issuing zero interest debt).
No you don't. The bond vs currency balance has minimal impact on inflation. Especially considering what the current bond rates are.
The way that you get hyperinflation is if the currency issuer wants to consume more resources than it can tax from the economy. Considering that the US production capacity is currently underutilized, that is unlikely, outside of governmental collapse or civil war.
Also, the platinum coin itself has no impact on inflation at all. It simply removes the artificial restrictions that prevent the government from fulfilling its debts obligations. (restrictions that are constitutionally questionable I might add)
You also have a potential situation where bond investors see the value of the dollar going to shit and demanding skyhigh interest rates due to the risk. Then you have to print more and more which creates the rates even higher!
Sovereign currency issuers controls the interest rates of their own bonds. All bond traders knows that.
1. Usenet with clients that allowed people to manage huge amounts of messages via ignoring and filtering 2. Forums such as Slashdot where you could no longer ignore/filter. 3. Linear forums where you could no longer have threads inside threads 4. Facebook/Youtube where you got further limitations on comments. 5. Twitter where the message length was down to under 200 characters.
It is fairly pathetic that first world countries in this day and age aren't able to provide the basic dignity of decent payed work to all its citizens.
Anyone living in a country with involuntary unemployment has no reason whatsoever to be proud of their country. Developed countries my ass. More like undeveloped barbaric countries. All modern first world countries have the capacity to afford to provide low skill jobs to all their citizens (and the job possibilities exists as well) . They just choose to not do so, because of greed, pure evil and utter stupidity (not necessarily in that order).
And no, European "socialist" countries aren't any better than the US. Being treated as a Lab rat or a Slave doesn't make much difference. I guess you feel better as a lab rat as long as you generally won't be subjected to any cruel experiments, but in both cases you are treated as subhuman and subject to the whims of your owner(s).
A perfect test to find experienced slashdot readers.
An ordinary person will find the above quote gibberish. But an experienced slashdot reader will see it for a second and automatically translate it to i<10.
You know what happened to those countries that spent more than they took in? HYPERINFLATION.
Hyperinflation happens to countries who lose control of their production resources via
* Foreign debt traps because they aren't a sovereign fiat country. (See Weimar) * Resource destruction. (See Zimbabwe land reform) * Loss of government taxing legitimacy, meaning that it really isn't their production resources any more. (Look for hyperinflations related to civil war and you'll probably find some good examples)
I think I may have missed some reason, but it all comes down to production resources in the end. Hyperinflation doesn't happen because the government spends more than it taxes. It happen because your country can't produce enough to cover the basic needs of the population/government.
Slashdot Mirror
No used game sales means less new game purchases
It is fairly trivial to show that the "recouped costs" as you put it will never allow more new game sales in a market that allows used sales.
If the used game market was 100% effective, then the new games sales would be the same between the two. However, the used market is far from efficient. It drains a huge percentage of the money that goes through it into the pocket of the dealers.
What is true is that a market without used sales will allow consumers to experience a lesser amount (not necessarily quality) of content. But if you want to make that argument, then I recommend that you first put your attention towards getting rid of copyright and intellectual property laws as they have the same effect.
. Situation is actually very similar to ours.
Hyperinflation generally happens because the government lack the ability to properly tax the amount of resources that it needs/wants.
In Weimar that happened because the government had debt denominated in gold which it couldn't repay without taxing the economy to destruction.
In the US, the debt is not a real problem as pretty much all the debt is denominated in dollars. With a 1:1 ratio between printed currency and debt repayed that isn't really a scenario for hyperinflation.
If you want to bet on hyperinflation in the US, I would go either with failure of taxing regime (USSR collapse) or collapse in production capabilities (Zimbabwe) as being more likely scenarios for hyperinflation.
And if all the work is done by robots, a government is needed more than ever, because then there will be no more economic wealth redistribution through wages.
That is something I think most people don't get. Governments naturally grow to fit the size of the available labor force after the private sector has had its share. (when it doesn't, it is called austerity and is generally a bad bad thing)
Macroeconomically speaking, any government only has 4 options:
* Pay the unemployed (large government with entitlements)
* Employ the unemployed directly or indirectly (large government)
* Institute max working per week and other rules to increase number of employees in the private sector (shrinks government, grows private sector)
* Wait for inevitable collapse or civil war.
Whenever Marxists talk about economy they like to overstate the importance of labour and understate the importance of capital.
Umm, the whole concept of Marxism is basically based around technology causing capital to become increasingly valuable, eventually leading to the capital in a few private hands destabilizing the economy and society as a whole.
Even with competition you run into the age old problem that private companies optimize for factors that aren't efficient for government.
For a private company, firing 100 people can be a massive efficiency boost. For the government, 100 unemployed people easily ends up costing more than just employing 100 people as it has to deal with the long term consequences.
Efficiency for the government is using less imported and natural resources. Meanwhile, private companies will easily spend more on imported and natural resources as long as it means that it can employ less people.
Its worse then that, the Canadian dollar has been matching and often outpacing the US dollar for much of the time since the 2008 collapse.
The CND has pretty much the exact same relative value as it had before the 2008 collapse (1:1). The EUR has significantly less relative value (it was at 1.6 and is now 1.3).
Does that apply to countries too?
Of course. That is basically what Keynes pointed out.
Countries grow when their politicians care about reducing unemployment and putting workers to productive use. Countries stagnate when the politicians only care about the stock market looking good.
That article claimed that super-rich people world wide have 21 trillion in assets. Suppose that's true AND we confiscate all of it.
Guess what. It's not enough. The public debt of the US, Japan and Europe combined is more than twice that, some 44 trillion.
We are broke.
For every one dollar that the federal government owes, someone owns that debt. That is a simple fact.
Fiat currencies are a basic zero sum game. The only interesting thing is the distribution as it has a real impact on the productivity of an economy. And here is where people are right to blame the government, as it is the federal government that is responsible for managing said distribution via taxes and spending.
And yes, the managing of the distribution of currency is inherently unfair. The whole point is to make it unfair in a way that best keeps the economy running well.
And why do you think I would care what a sociopath like yourself thinks?
Well... they can get another job you say... Well the union busting plantation owners made sure that the vast majority of America's jobs abuse their employees, so you can only choose among bad options.
This is why a federal sponsored job guarantee is a much better solution than a minimum wage. A minimum wage only sets a lower limit for how much someone will get paid. It doesn't set a lower limit for how that person will be treated, or the likely-hood of getting a job in the first place.
Sure, you could use an income guarantee or social safety net instead. But considering most people don't like other people "exploiting welfare", isn't it better to let people work for a living instead.
Sure, job guarantee jobs would probably not be the most productive, but then again, most minimum wage jobs aren't that productive either. (if they were, then they wouldn't be minimum wage)
Also, the job guarantee would act as an automatic stabilizer, increasing the amount of currency inflow into the economy when private sector labor demand decreases, and decreasing it when the the labor demand increases.
I guess some people don't like that it would be possible to stay in the job guarantee instead of "taking a really job", but that is missing the point. In addition to providing employment of last resort, the job guarantee is supposed to be the lower bound of what is considered an acceptable work place in a modern society. If a company in the private sector can't compete with that, then the problem isn't really with the job guarantee, but with the company.
GDP per capita is twelfth in the nation, so apparently those protections come at a very high cost
There are a total of two "right to work" states with higher GDP/capita than California. There are about 20 with lower.
Really, why did you have to bring up GDP. Don't you have the basic neoliberal playbook in front of you. I am fairly certain that there is a rule in there about never mentioning GDP. Much better to mention "Purchasing Power" or "Net salary" that explicitly leaves out a good part of the government contribution to the economy. That way you can properly inflate the value of economies with small governments.
Maybe your life is about risk and reward. Why force that onto everyone?
Because if he doesn't, he would have to gamble his life in a game with a bunch of sociopaths that won't hesitate to stab him in the back.
Much easier to trick a bunch of social people to join the game so that that there will be more fodder for the knife stabbing.
That has always been the core idea behind neoliberalism. Survival of the fittest, where the fittest of course are those who decide the rules of the game.
You haven't answered the most important question: how is the trillion dollars removed from the money supply?
There is no removal or adding. Monetary wise, the whole trillion dollar coin is a zero sum maneuver. You just replace one monetary asset (bonds) with another monetary asset (coin).
Politically it has larger meaning. The biggest one is that it explicitly demonstrates the economic sovereignty of the US government as spelled out in the constitution, by pointing out that the debt limit is a nowadays pointless construct remaining from the gold standard era. Also, it prevent fiscal gridlock by insane politicians. And anything that prevents utter stupidity by insane politicians is a good thing in my opinion.
Governments printing money to pay their debts is nothing new. It has a long history indeed. And I don't think there is a single major example where inflation did not soon follow. Often hyper-inflation in fact.
Actually, you will find extremely few examples of governments printing money to pay their internally denominated fiat currency debts. Which is fairly understandable. Bonds in an economically sovereign fiat currency are as trustworthy as pure cash, making it counterproductive to hold cash instead of bonds unless you need immediate access to the cash.
And if such a government does do it, there is pretty much no inflation as bonds and cash are so similar in a sovereign fiat economy as mentioned above. I say pretty much, as it should be obvious that if you have to hold dollars instead of bonds, then you are more likely to spend them into the economy, which will heat up the economy and hence lead to
Most of the "monetizing the debt" hysteria comes from historical examples with foreign denominated debt (including gold). There are countless examples of why printing money to pay back foreign denominated debt can lead to hyper inflation.
Hate to tell you this, but most of us in the top 5% started in the lower 50%.
lol
The social mobility in the US is horrible and getting worse. You got very lucky and now you piss on those below you.
And then you go on and whine about Obama who is basically a moderate conservative, not too far from Reagan in economic policy.
Simply put, you are an ignorant asshole like so many others of the top 10% percent.
It would help them by not having to pay interest on some of the outstanding tax credits (that is all dollars are) and by not having to deal with a debt limit that was instituted when the US dollar was a gold standard and hence under real spending constraints.
. How would they remove a trillion dollars from circulation anyway?
What happens is that the treasury deposits the coin at the fed, thereby getting a huge surplus on its accounts (yes, it is just numbers on an account that the fed can create with a keystroke) that it can use to repay bonds if it wants to when it wants to. This coincidently ensures that the US dollar maintains a high rating, by demonstrating that the the whole "US government can repay all its debts" is explicitly true and not under any kind of political debt limit whim.
This doesn't really cause any inflation that didn't already exist, because all you are doing is trading one tax liability with interest (bonds) for another tax liability without interest (virtual numbers on an account).
You could argue for a small coincidental inflation as the lessened amount of available bonds encourages people holding US tax credit notes to spend them immediately instead of putting them into bonds (although only if the government repays bonds hold by the foreign or private sector. Those held by itself should have no impact). As the economy is not running at full capacity at the moment, any such inflation would be minimal however. And the increased currency spending would also increase tax incomes, thereby reducing the need to remove further bonds from the market.
And why would hyperinflation happen if you replaced interest carrying currency with non-interest carrying currency? If anything, the government would pay less interest, thereby decreasing the total amount of currency that enters the private sector, which in turn would reduce inflation.
http://seekingalpha.com/article/1081141-the-fed-and-interest-rates-the-details
Then why is the yield on govt. bonds only 1.8%
I am not going to say something about how weak or strong the dollar is. I just wanted to point out that bond yields are not indicative of the strength of a sovereignly controlled fiat currency.
The US government can always print money to cover the bond repayments. As long as a bond holder has use for US dollars, they therefore represents a very safe investment. And as long as there are no foreign denominated debts involved (if there were, you couldn't really call US sovereign), said printing won't have a negative impact on the internal economy either.
In fact, from what I understand of how things work in practice, it is more or less the federal reserve that sets the bond interest rates, not the bond holders
As government debt is equivalent to private sector savings (ignoring foreign savings for simplicity), it is fairly easy to see why governments run near permanent deficits.
As the economy grows, the private sector tends to want to save more. Hence, only the government is left to take on the debt (unless you want to involve the foreign sector and run a massive foreign trade surplus, but that is just moving the problem up to the international level instead as it is basically a zero sum problem)
That said, there is no reason to pay interest on all that debt. To allow more private sector savings, the government can issue currency with or without interest. However, the same people who whine about the debt tend to also complain about "monetizing the debt" (a.k.a. issuing zero interest debt).
Tell that to Europe? Germany had to raise its rates as no bank would touch them with a 10 foot pole.
Way to make my point. Germany is not a sovereign currency issuer. Neither is Greece.
Then you have hyperinflation.
No you don't. The bond vs currency balance has minimal impact on inflation. Especially considering what the current bond rates are.
The way that you get hyperinflation is if the currency issuer wants to consume more resources than it can tax from the economy. Considering that the US production capacity is currently underutilized, that is unlikely, outside of governmental collapse or civil war.
Also, the platinum coin itself has no impact on inflation at all. It simply removes the artificial restrictions that prevent the government from fulfilling its debts obligations. (restrictions that are constitutionally questionable I might add)
You also have a potential situation where bond investors see the value of the dollar going to shit and demanding skyhigh interest rates due to the risk. Then you have to print more and more which creates the rates even higher!
Sovereign currency issuers controls the interest rates of their own bonds. All bond traders knows that.
1. Usenet with clients that allowed people to manage huge amounts of messages via ignoring and filtering
2. Forums such as Slashdot where you could no longer ignore/filter.
3. Linear forums where you could no longer have threads inside threads
4. Facebook/Youtube where you got further limitations on comments.
5. Twitter where the message length was down to under 200 characters.
It is fairly pathetic that first world countries in this day and age aren't able to provide the basic dignity of decent payed work to all its citizens.
Anyone living in a country with involuntary unemployment has no reason whatsoever to be proud of their country. Developed countries my ass. More like undeveloped barbaric countries. All modern first world countries have the capacity to afford to provide low skill jobs to all their citizens (and the job possibilities exists as well) . They just choose to not do so, because of greed, pure evil and utter stupidity (not necessarily in that order).
And no, European "socialist" countries aren't any better than the US. Being treated as a Lab rat or a Slave doesn't make much difference. I guess you feel better as a lab rat as long as you generally won't be subjected to any cruel experiments, but in both cases you are treated as subhuman and subject to the whims of your owner(s).
i 10?
A perfect test to find experienced slashdot readers.
An ordinary person will find the above quote gibberish. But an experienced slashdot reader will see it for a second and automatically translate it to i<10.
You know what happened to those countries that spent more than they took in? HYPERINFLATION.
Hyperinflation happens to countries who lose control of their production resources via
* Foreign debt traps because they aren't a sovereign fiat country. (See Weimar)
* Resource destruction. (See Zimbabwe land reform)
* Loss of government taxing legitimacy, meaning that it really isn't their production resources any more. (Look for hyperinflations related to civil war and you'll probably find some good examples)
I think I may have missed some reason, but it all comes down to production resources in the end. Hyperinflation doesn't happen because the government spends more than it taxes. It happen because your country can't produce enough to cover the basic needs of the population/government.