In reality, they need more CHEAP programmers and engineers from China and India. Paying for the experienced programmers and engineers already out there aren't as good for the profit margins.
What is wrong with that?
I also want cheap cars, cheap clothes, cheap shoes, etc. I assume a majority of consumers are like me. Why shouldn't companies act in the same way?
If in the quest for cheap goods, I buy crappy ones, then I suffer. Similarly, if MS and IBM hire crappy coders just because they are cheap (something I know is true, at least in IBM's case), well then they will suffer.
I don't understand why it is ok for Joe Sixpack to look for the cheapest product and not ok for EvilMegaCorp to do the same.
Similarly, salaries of IT professionals world-wide are projected to stagnant or possibly fall due to the large pool of qualified applicants in the market today.
Similarly, the price of computer hardware world-wide are projected to stagnate or possibly fall due to improvements in technology and an increase in the number of manufacturers. We all know that cannot be good for the industry.
When the cost of any product (or service) falls, more people/companies can use that product due to the reduced cost and produce more/better stuff for the end consumer - this is true for microchips, shoes, tools, janitors or programming services.
Yeah, it sucks if you are the producer of the product whose price falls, but the consumers of your product or service do not have to support you. It does not matter if the price falls because of technology or because of cheap "foreign" imports - either way the consumer has more money in the pocket now to create other, new stuff (either by himself or by investing).
God - I read that about 10 times before posting and I never thought that a comma was the problem. I kept reading it as "Saying that the Author does a good job of leading you through the languages intricacies,...... "
Still, he could've written "Having said that, the author does a..."
Saying that the Author does a good job of leading you through the languages intricacies with examples being compared to code from languages such as Java to help keep your feet on solid programming ground.
I'm a libertarian, but I don't believe a true free market would magically protect everyone - I recognize there's a risk of increased poverty and stratification (although I'm not convinced that's actually the inevitable result).
You are confused. If by stratification, you mean economic gap, I can tell you that that will definitely happen. Just like the gap between skilled sportsmen and others, just like skilled musicians and others, just like skilled programmers and others, there will be a huge gap between people with the skill to make money and other who don't. However, there cannot be increased poverty in a free market.
I'm from India. For 40-odd years, we had a socialist govt. that protected the poor from the rich. It put in regulations to protect the poor handloom worker from parasites like my father who had a textile factory and produced cheaper clothes.
A poor, illiterate person in those days could work 20 hour days and still not have enough money for the basics. Of course, the blame was on the rich capitalists who 'steal from the poor'.
In 1992, the govt lifted many regulations. The wealth in the country grew. The gap between the rich and poor grew too. But, an unskilled person now could work in any of the newly built factories and make enough to feed his family. He could buy cheap clothes (and other goods) because the govt does not artificially keep the price high.
The demand for workers is so crazy in my home town, the factories send out 'agents' to lure workers from other factories - usually with more pay and benefits. (All this are just anecdotes from my state, Tamil Nadu)
The point I'm trying to make is that even the lowly manual laborer with no skills can benefit from wealth created in a society. The stratification or the gap between rich and poor does not matter. What matters is 'how much wealth does a society produce'?
Govt regulations do not produce more 'stuff' - they can only take from the most productive and give it to the least productive. The result is more equality and less wealth.
"Did you use anything created by society? Doctors? Public schools? Roads?"
I didn't ask for it. In the US, money is taken from you for schools and roads whether you want them or not. In other countries, you are not allowed to build your own schools.
So if I prevent you from paying for your own car, insist that only I can provide you with a car and make you pay for that car, I own you and your labors for life?
Because obviously, any success that you had was only possible because I provided you with transportation. So you have to "give back" now.
While Americans consider graft to be wrong, many American companies find the only way to access foreign markets is to pay off the corrupt gatekeepers.
If you bribe someone in a foreign country, it is called graft/corruption/bribery/etc and is a crime.
If you do that in America, it is called 'lobbying' and is as American as apple pie. If only those corrupt foreigners stop calling it bribery and call it lobbying, the pure as milk American companies would not have to engage in this crime.
An economist dreams that fancy accounting can fix things,
Economists, like engineers, vary greatly in their abilities and knowledge. And unlike medicine and engg, people do not see economics as a real science that requires some education - they see economics as something obvious that does not require great thought.
But like any other science, economics is needed to throw light on things that are counter intuitive:
- it looks like the sun revolves around the earth, but it doesn't.
- it is "obvious" that a minimum wage helps poor people, except it doesn't.
And this is precisely why you need science.
But since most people do not grasp this, there are many economists who take the easy route and just support the popular opinion. These are the kinds of economists that you deride in your post - people whose logic does not add up and who resort to phrases like "the Fed injects liquidity" (injected it where? where did the liquidity come from?), "the Fed cools down an overheating economy" (what is 'overheating'? how did that happen?) or "the Fed cuts rates to help the economy" (then why doesn't the Fed keeps the rates at 0% all the time?).
But there are other economists like Mises, Bastiat, etc whose theories have as much science behind them as any engineer's design. These people were not afraid to voice unpopular opinions and hence are not very popular. But if you take the time to read their theories, a lot of things which are "obvious" to you may end up being not so obvious.
I wonder how many jobs there would have been if the government hadn't taxed that money in the first place? I find it funny people think that somehow the government can magically make the economy better by taking money from the citizens and then redistributing it in whatever inefficient manner it sees fit.
That is insane - you are considering the cost! Like an economist even!
We the taxpayers do not care about the cost - we want our govt to feed us, clothe us, wipe our arses and "create jobs".
The next time somebody uses the phrase "create jobs", tell them an easy way to create jobs is to ban power tools - "think of the number of jobs that will create! More carpenters, more ditch diggers, more horse buggy drivers!!"
Maybe that will teach the idiots that creating value is the goal and jobs are just a means to that end.
No, you are not.
A real libertarian (or even a Libertarian) would say that this is an issue between the service provider and the customer and the free market should sort it out.
If people want a cab with GPS and butt warmers, they should choose a cab company that provides it. If all the customer cares about is the lowest price, they should be free to choose the "cash only" BO-mobile driven by a mad Punjabi. The state has no business interfering in this.
Apparently it is 'the market', but if that's the case then why can't I buy Region 6 DVDs from Circuit City for $1? Why is there a stink made by companies and economists who say that free trade is the greatest thing since sliced bread, but then complain when they see products sold on eBay for prices that are genuinely fair given the elimination of transaction barriers in the global economy.
When the govt restricts how you use your product, then it is no longer free trade. It is managed trade - and depending on how much money you can pay to the politicians, the terms will benefit you.
And btw, when someone praises free trade and then attaches conditions "for certain exceptional situations", you can be sure that they are not for free trade at all.
'We can't find qualified native candidates for the paltry compesation we're offering"
Jut like people want to but the lowest priced shoes, TVs or oil for the lowest price, companies also want to buy labor for the lowest cost. What is wrong with that? You don't have a right to be employed by someone.
How many 16 year olds can be trusted to vote for politicians that promise decent care for the elderly, and reasonable pension provisioning ?
How many 16 year olds actually give a flying fuck about anything except themselves, or things that affect them directly ?
So you are saying that 16 year olds would want to stop old people stealing from them and would look out for their own future? That would be wonderful.
(a statement for which I can find a number of counterexamples, particularly the horrifically overregulated airline industry in the Seventies, when airfares were grotesquely expensive but there was quite a bit of sucking up to the customer, nearly all flights were pretty much direct, and the entire continent's air transport didn't shut down because of a thunderstorm over Boston)
Wow - that must've been cool. I suppose you also had as many options and number of daily flights that we have now?
Oh, and I'm sure you could fly across the country for $200 (that is 2007 dollars not 1970 dollars) like I can do now?
You don't have to invest in bond markets, you just have to put your money in a bank. Your claim amounts to "The Fed is doing a horrible injustice to everyone and ruining the economy because people have to put their money in banks to preserve its value." I accept that this inconvenience is an injustice (though a minor one). It's just... come on. Is it REALLY that bad that you have to put your money in a bank (or perhaps buy gold) to preserve its value over long periods of time?.
Say inflation is at 5%. Say the bank pays be an interest of 5%. So it looks like you are correct - my money does not lose value and it is a wash. But, without inflation, would I have not come out ahead? This is what I meant by the treadmill. This holds true even if inflation is 1% and my investment fetches me 1001% - without inflation I would've made 1001% instead of the 1000% I make with it.
If your point (that ppl and markets can easily work around inflation) is valid, then it should be true for 2% inflation or 5000% inflation. But why does higher inflation cause such devastation (see Brazil and Yugoslavia(?)) when a lower one does not?
Think about it this way - the guy who gets the free chips from Mr. A got some real wealth for nothing. Where did that wealth come from? According to your logic, that wealth came from thin air (you do not accept that ppl lose wealth due to inflation; if no one lost wealth and someone gained wealth without producing, then that must have come from thin air).
Obviously, that wealth he obtained did not come from thin air - it was taken (or will be taken) from the pockets of other players. The players might realise this and adjust. But that does not mean that real wealth was not transferred from the players to Mr. A's friend.
The point you are missing is that inflation is a drain on the economy. It takes wealth (or chips) from people who are productive and create wealth and moves it to people with connections. When this is manageable (2-5%), people can just run a little bit quicker to make up for it. When it is >10%, people cannot run hard enough.
And we are still looking at it at a micro level. I haven't even mentioned how inflation distorts the market and causes misallocation of resources which is an even bigger problem.
But the problem with extending that example to the present world is that the chip issuer -- and the Fed -- can only do that once. Every point thereafter, people *know* what's going on with the chips.
Well, I'm not totally clear on what you mean by "they can only do that once". They do that 24x7x365.
Likewise, people trade dollars at a discount, knowing the currency will be inflated. That is why future dollars (in the form of bonds) trade at a discount -- to adjust for the inflation the market predicts the Fed will induce. They may underestimate inflation -- buy they can also overestimate inflation.
What you are saying is like "I know I'm on a treadmill, so I'll just run a little bit faster". Don't you think you'll be further ahead if you aren't forced to be on this treadmill? What about poor folk who do not have the financial savvy to invest in bond markets?
And you are also ignoring the fact that Mr. A (or the Fed) is stealing from you. You are ignoring the fact that the real wealth your chips (or dollar bills) are supposed to represent is declining every day. And just because everyone knows about this and adjusts their prices (and they do in any market), does not mean that your wealth is not being transferred to someone else.
The inflation created by the Fed is in principle the same as that of the inflation created by the Roman emperors. This is not necessary.
What violence? You're not personally required to accept USD
Well, I was under the impression that you have to accept dollar bills for debts and you cannot refuse them. And just because I can transfer them to another form does not justify the original threat of violence.
I've found that I can't quite buy that the Fed can cause the damage some people claim it does. All off its powers brush up against the so-called "rational expectations" so that markets "price around" and kind of goofiness it wants to inject into the economy.
Well, if the market "prices around" the Fed's shenanigans, why is it that I can buy less goods for $100 in 2007 than I could in 1950? I should not have to go to any extra effort to maintain the value of the $100 I had in 1950. Because of higher productivity, I should be able to buy *more* stuff in 2007 than in 1950, not less (I'm talking average price of all goods, if such a thing can be calc). If this is not proof, I do not know what is.
Oh, and put me back on your friends list, you vindictive knave.
Not until you renounce your heathen Fed-loving ways and return to the TRUE WAY.
This implies that Mr.A is running a business on the side to generate wealth. Nothing wrong with that (well, as long as he lets everyone know that they cannot get their money on demand if they all do it at once).
The problem is that that is not what the Fed does. The Fed does not take a portion of wealth deposited into its system and invest it into a profitable entity. And it certainly does not tell its depositors that they cannot get their money on demand under certain conditions.
What it does is like what I described - it creates more chips than it has dollars and gives these new chips to its friends. There is no investing and wealth generation going on here.
So, what's exactly wrong with backing something with a promise?
Imagine this scenario:
You join a poker game. You give $100 to Mr.A to buy some chips. Mr. A puts the $100 in a box along with the other dollars others have given him for the chips and Mr. A gives you 100 chips.
At the end of the game, *everyone* in the game will give their chips to Mr. A and get back real money. Hopefully, everyone will tip Mr. A for services provided.
Now, the next day you join the game and you notice there is a new player, Mr. Fed.
Mr. Fed gives Mr A $10, but instead of getting 10 chips, he gets 100 chips. Now, you forsee a problem at the end of the game and you ask Mr. A how he plans to honor his obligation.
Mr. A replies "I promise to pay you the $1 for all your chips. What's exactly wrong with backing something with a promise?"
Mr. A is betting on the fact that not all players leave the game at once. Many players play for years and never redeem their chips. Also, players exchange the chips among themselves for other debts unrelated to the poker game. But the fact is Mr. A does not have the $$$ to match the chips in circulation.
So, what's exactly wrong with backing something with a promise?
A promise, just like a contract, must be made in good faith. I can promise my client that I can build a rocket to Mars in 2 weeks and get a payment - but it is not made in good faith. Now, my client is a fool for believing this and should lose his money, but in the scenario with the Fed, there is the threat of violence involved. And that is what many people object to.
And btw, this is the definition of inflation. The players in the fictional game, realizing that 1 chip < $1, start charging more and more chips for other services. Roman emperors reduced the % of gold in coins, the Fed just reduces the amount of wealth each dollar represents.
If you peel the layers of this onion, you will find that this is a giant Ponzi scheme except that the Fed prints its own money and you get thrown in jail if you try to leave the game.
Slashdot Mirror
In reality, they need more CHEAP programmers and engineers from China and India. Paying for the experienced programmers and engineers already out there aren't as good for the profit margins.
What is wrong with that?
I also want cheap cars, cheap clothes, cheap shoes, etc. I assume a majority of consumers are like me. Why shouldn't companies act in the same way?
If in the quest for cheap goods, I buy crappy ones, then I suffer. Similarly, if MS and IBM hire crappy coders just because they are cheap (something I know is true, at least in IBM's case), well then they will suffer.
I don't understand why it is ok for Joe Sixpack to look for the cheapest product and not ok for EvilMegaCorp to do the same.
If it was outsourced because they couldn't find enough cheap labor in India, that's *good* news for wages.
No, that is good news for you and me who work in the software industry because we will make more money in the short term.
It is bad news to consumers of software services - companies (and hence their customers).
Similarly, salaries of IT professionals world-wide are projected to stagnant or possibly fall due to the large pool of qualified applicants in the market today.
Similarly, the price of computer hardware world-wide are projected to stagnate or possibly fall due to improvements in technology and an increase in the number of manufacturers. We all know that cannot be good for the industry.
When the cost of any product (or service) falls, more people/companies can use that product due to the reduced cost and produce more/better stuff for the end consumer - this is true for microchips, shoes, tools, janitors or programming services.
Yeah, it sucks if you are the producer of the product whose price falls, but the consumers of your product or service do not have to support you. It does not matter if the price falls because of technology or because of cheap "foreign" imports - either way the consumer has more money in the pocket now to create other, new stuff (either by himself or by investing).
God - I read that about 10 times before posting and I never thought that a comma was the problem. I kept reading it as "Saying that the Author does a good job of leading you through the languages intricacies, ...... "
..."
Still, he could've written "Having said that, the author does a
Saying that the Author does a good job of leading you through the languages intricacies with examples being compared to code from languages such as Java to help keep your feet on solid programming ground.
It's a shame when such a thing happens so young
It is also a shame when grown people run away from reason.
I'm a libertarian, but I don't believe a true free market would magically protect everyone - I recognize there's a risk of increased poverty and stratification (although I'm not convinced that's actually the inevitable result).
You are confused. If by stratification, you mean economic gap, I can tell you that that will definitely happen. Just like the gap between skilled sportsmen and others, just like skilled musicians and others, just like skilled programmers and others, there will be a huge gap between people with the skill to make money and other who don't. However, there cannot be increased poverty in a free market.
I'm from India. For 40-odd years, we had a socialist govt. that protected the poor from the rich. It put in regulations to protect the poor handloom worker from parasites like my father who had a textile factory and produced cheaper clothes.
A poor, illiterate person in those days could work 20 hour days and still not have enough money for the basics. Of course, the blame was on the rich capitalists who 'steal from the poor'.
In 1992, the govt lifted many regulations. The wealth in the country grew. The gap between the rich and poor grew too. But, an unskilled person now could work in any of the newly built factories and make enough to feed his family. He could buy cheap clothes (and other goods) because the govt does not artificially keep the price high.
The demand for workers is so crazy in my home town, the factories send out 'agents' to lure workers from other factories - usually with more pay and benefits. (All this are just anecdotes from my state, Tamil Nadu)
The point I'm trying to make is that even the lowly manual laborer with no skills can benefit from wealth created in a society. The stratification or the gap between rich and poor does not matter. What matters is 'how much wealth does a society produce'? Govt regulations do not produce more 'stuff' - they can only take from the most productive and give it to the least productive. The result is more equality and less wealth.
"Did you use anything created by society? Doctors? Public schools? Roads?"
I didn't ask for it. In the US, money is taken from you for schools and roads whether you want them or not. In other countries, you are not allowed to build your own schools.
So if I prevent you from paying for your own car, insist that only I can provide you with a car and make you pay for that car, I own you and your labors for life?
Because obviously, any success that you had was only possible because I provided you with transportation. So you have to "give back" now.
You were born in the USSR and you cannot recognize a communist? The phrase "left-libertarian" should have tipped you off.
While Americans consider graft to be wrong, many American companies find the only way to access foreign markets is to pay off the corrupt gatekeepers.
If you bribe someone in a foreign country, it is called graft/corruption/bribery/etc and is a crime.
If you do that in America, it is called 'lobbying' and is as American as apple pie. If only those corrupt foreigners stop calling it bribery and call it lobbying, the pure as milk American companies would not have to engage in this crime.
Having lived in a third world country with no minimum wage and no social benefit, and now in a second world country with both.... I can say...
Well for what it's worth, I'm from India, now living in Chicago. I worked in a subway restaurant for a year for min wage while studying here.
A minimum wage and no livable benefit is against poor peoples interests.
A minimum wage and a livable social benefit makes a huge difference.
Can you explain why? Who pays for the "livable social benefit"?
I know some nice garbage heaps
I'm sure you do.
Yeah baby - I want to standardize you so bad.....
An economist dreams that fancy accounting can fix things,
Economists, like engineers, vary greatly in their abilities and knowledge. And unlike medicine and engg, people do not see economics as a real science that requires some education - they see economics as something obvious that does not require great thought.
But like any other science, economics is needed to throw light on things that are counter intuitive:
- it looks like the sun revolves around the earth, but it doesn't.
- it is "obvious" that a minimum wage helps poor people, except it doesn't.
And this is precisely why you need science.
But since most people do not grasp this, there are many economists who take the easy route and just support the popular opinion. These are the kinds of economists that you deride in your post - people whose logic does not add up and who resort to phrases like "the Fed injects liquidity" (injected it where? where did the liquidity come from?), "the Fed cools down an overheating economy" (what is 'overheating'? how did that happen?) or "the Fed cuts rates to help the economy" (then why doesn't the Fed keeps the rates at 0% all the time?).
But there are other economists like Mises, Bastiat, etc whose theories have as much science behind them as any engineer's design. These people were not afraid to voice unpopular opinions and hence are not very popular. But if you take the time to read their theories, a lot of things which are "obvious" to you may end up being not so obvious.
I wonder how many jobs there would have been if the government hadn't taxed that money in the first place? I find it funny people think that somehow the government can magically make the economy better by taking money from the citizens and then redistributing it in whatever inefficient manner it sees fit.
That is insane - you are considering the cost! Like an economist even!
We the taxpayers do not care about the cost - we want our govt to feed us, clothe us, wipe our arses and "create jobs".
The next time somebody uses the phrase "create jobs", tell them an easy way to create jobs is to ban power tools - "think of the number of jobs that will create! More carpenters, more ditch diggers, more horse buggy drivers!!"
Maybe that will teach the idiots that creating value is the goal and jobs are just a means to that end.
I am a staunch libertarian...
No, you are not.
A real libertarian (or even a Libertarian) would say that this is an issue between the service provider and the customer and the free market should sort it out.
If people want a cab with GPS and butt warmers, they should choose a cab company that provides it. If all the customer cares about is the lowest price, they should be free to choose the "cash only" BO-mobile driven by a mad Punjabi. The state has no business interfering in this.
Apparently it is 'the market', but if that's the case then why can't I buy Region 6 DVDs from Circuit City for $1? Why is there a stink made by companies and economists who say that free trade is the greatest thing since sliced bread, but then complain when they see products sold on eBay for prices that are genuinely fair given the elimination of transaction barriers in the global economy.
When the govt restricts how you use your product, then it is no longer free trade. It is managed trade - and depending on how much money you can pay to the politicians, the terms will benefit you.
And btw, when someone praises free trade and then attaches conditions "for certain exceptional situations", you can be sure that they are not for free trade at all.
'We can't find qualified native candidates for the paltry compesation we're offering"
Jut like people want to but the lowest priced shoes, TVs or oil for the lowest price, companies also want to buy labor for the lowest cost. What is wrong with that? You don't have a right to be employed by someone.
And all of that is 100% profit. They must get the OS for free of course and the total payroll (for 10 years) cannot exceed a few thousand dollars.
How many 16 year olds can be trusted to vote for politicians that promise decent care for the elderly, and reasonable pension provisioning ?
How many 16 year olds actually give a flying fuck about anything except themselves, or things that affect them directly ?
So you are saying that 16 year olds would want to stop old people stealing from them and would look out for their own future? That would be wonderful.
(a statement for which I can find a number of counterexamples, particularly the horrifically overregulated airline industry in the Seventies, when airfares were grotesquely expensive but there was quite a bit of sucking up to the customer, nearly all flights were pretty much direct, and the entire continent's air transport didn't shut down because of a thunderstorm over Boston)
Wow - that must've been cool. I suppose you also had as many options and number of daily flights that we have now?
Oh, and I'm sure you could fly across the country for $200 (that is 2007 dollars not 1970 dollars) like I can do now?
Ah.. the good old days.
You don't have to invest in bond markets, you just have to put your money in a bank. Your claim amounts to "The Fed is doing a horrible injustice to everyone and ruining the economy because people have to put their money in banks to preserve its value." I accept that this inconvenience is an injustice (though a minor one). It's just ... come on. Is it REALLY that bad that you have to put your money in a bank (or perhaps buy gold) to preserve its value over long periods of time?.
Say inflation is at 5%. Say the bank pays be an interest of 5%. So it looks like you are correct - my money does not lose value and it is a wash. But, without inflation, would I have not come out ahead? This is what I meant by the treadmill. This holds true even if inflation is 1% and my investment fetches me 1001% - without inflation I would've made 1001% instead of the 1000% I make with it.
If your point (that ppl and markets can easily work around inflation) is valid, then it should be true for 2% inflation or 5000% inflation. But why does higher inflation cause such devastation (see Brazil and Yugoslavia(?)) when a lower one does not?
Think about it this way - the guy who gets the free chips from Mr. A got some real wealth for nothing. Where did that wealth come from? According to your logic, that wealth came from thin air (you do not accept that ppl lose wealth due to inflation; if no one lost wealth and someone gained wealth without producing, then that must have come from thin air).
Obviously, that wealth he obtained did not come from thin air - it was taken (or will be taken) from the pockets of other players. The players might realise this and adjust. But that does not mean that real wealth was not transferred from the players to Mr. A's friend.
The point you are missing is that inflation is a drain on the economy. It takes wealth (or chips) from people who are productive and create wealth and moves it to people with connections. When this is manageable (2-5%), people can just run a little bit quicker to make up for it. When it is >10%, people cannot run hard enough.
And we are still looking at it at a micro level. I haven't even mentioned how inflation distorts the market and causes misallocation of resources which is an even bigger problem.
But the problem with extending that example to the present world is that the chip issuer -- and the Fed -- can only do that once. Every point thereafter, people *know* what's going on with the chips.
Well, I'm not totally clear on what you mean by "they can only do that once". They do that 24x7x365.
Likewise, people trade dollars at a discount, knowing the currency will be inflated. That is why future dollars (in the form of bonds) trade at a discount -- to adjust for the inflation the market predicts the Fed will induce. They may underestimate inflation -- buy they can also overestimate inflation.
What you are saying is like "I know I'm on a treadmill, so I'll just run a little bit faster". Don't you think you'll be further ahead if you aren't forced to be on this treadmill? What about poor folk who do not have the financial savvy to invest in bond markets?
And you are also ignoring the fact that Mr. A (or the Fed) is stealing from you. You are ignoring the fact that the real wealth your chips (or dollar bills) are supposed to represent is declining every day. And just because everyone knows about this and adjusts their prices (and they do in any market), does not mean that your wealth is not being transferred to someone else.
The inflation created by the Fed is in principle the same as that of the inflation created by the Roman emperors. This is not necessary.
What violence? You're not personally required to accept USD
Well, I was under the impression that you have to accept dollar bills for debts and you cannot refuse them. And just because I can transfer them to another form does not justify the original threat of violence.
I've found that I can't quite buy that the Fed can cause the damage some people claim it does. All off its powers brush up against the so-called "rational expectations" so that markets "price around" and kind of goofiness it wants to inject into the economy.
Well, if the market "prices around" the Fed's shenanigans, why is it that I can buy less goods for $100 in 2007 than I could in 1950? I should not have to go to any extra effort to maintain the value of the $100 I had in 1950. Because of higher productivity, I should be able to buy *more* stuff in 2007 than in 1950, not less (I'm talking average price of all goods, if such a thing can be calc). If this is not proof, I do not know what is.
Oh, and put me back on your friends list, you vindictive knave.
Not until you renounce your heathen Fed-loving ways and return to the TRUE WAY.
and using it to supply the bar.
This implies that Mr.A is running a business on the side to generate wealth. Nothing wrong with that (well, as long as he lets everyone know that they cannot get their money on demand if they all do it at once).
The problem is that that is not what the Fed does. The Fed does not take a portion of wealth deposited into its system and invest it into a profitable entity. And it certainly does not tell its depositors that they cannot get their money on demand under certain conditions.
What it does is like what I described - it creates more chips than it has dollars and gives these new chips to its friends. There is no investing and wealth generation going on here.
I don't follow you. Can you try again with a car analogy?
Stop this already. Car analogies do not work when applied to software or copyright issues.
Using a car analogy to explain copyright issues is like adding a Pontiac engine to a Honda.
So, what's exactly wrong with backing something with a promise? :
Imagine this scenario
You join a poker game. You give $100 to Mr.A to buy some chips. Mr. A puts the $100 in a box along with the other dollars others have given him for the chips and Mr. A gives you 100 chips.
At the end of the game, *everyone* in the game will give their chips to Mr. A and get back real money. Hopefully, everyone will tip Mr. A for services provided.
Now, the next day you join the game and you notice there is a new player, Mr. Fed.
Mr. Fed gives Mr A $10, but instead of getting 10 chips, he gets 100 chips. Now, you forsee a problem at the end of the game and you ask Mr. A how he plans to honor his obligation.
Mr. A replies "I promise to pay you the $1 for all your chips. What's exactly wrong with backing something with a promise?"
Mr. A is betting on the fact that not all players leave the game at once. Many players play for years and never redeem their chips. Also, players exchange the chips among themselves for other debts unrelated to the poker game. But the fact is Mr. A does not have the $$$ to match the chips in circulation.
So, what's exactly wrong with backing something with a promise?
A promise, just like a contract, must be made in good faith. I can promise my client that I can build a rocket to Mars in 2 weeks and get a payment - but it is not made in good faith. Now, my client is a fool for believing this and should lose his money, but in the scenario with the Fed, there is the threat of violence involved. And that is what many people object to.
And btw, this is the definition of inflation. The players in the fictional game, realizing that 1 chip < $1, start charging more and more chips for other services. Roman emperors reduced the % of gold in coins, the Fed just reduces the amount of wealth each dollar represents.
If you peel the layers of this onion, you will find that this is a giant Ponzi scheme except that the Fed prints its own money and you get thrown in jail if you try to leave the game.