it consumes 2GB of memory. Yes, 2GB of memory for 100MB of input data. This is not a real-world algorithm; this is CS weenies wanking off.
If that's true (and this is important), then I'd have to agree with you. Compressing only one data stream, with an algorithm longer than the data stream, is not compression. Oddly enough, in my last post, I was just joking about how you could cheat by having the algorithm be:
0 = 0 1 = [entire wikipedia database]
And say, "Hah, I compressed it to 1!"
But then... that would actually be better than what they did, if what you're saying is true:-P
I don't know if this is quite what you are getting at, but it seems like you are saying:
What if someone proposed this algorithm?
Compression key:
0 = 0 1 = Wikipedia, the free encyclopedia. Welcome to... [i.e., the entire Wikipedia database you're supposed to be compressing]
And then stored Wikipedia as "1". And you'd be correct, that you can give a false "improvement" in the compression by stuffing the informational complexity within the compression algorithm and completely destroy its usefulness. It would be great for one very specific datastream, but nothing else.
More generally, if you want a compression algorithm for an arbitrary data stream, you need to rely on some kinds of patterns being in it, that are inherent to the kind of data it is. Truly random data can have no compression because the average length in compressed form will be no shorter -- there are no patterns to exploit.
Good point, but I'm not sure if I said what you were looking for:-/
Wait -- for all your complaining about health-related fud, aren't you the one who thinks a valid way to calculate fraction of health care costs due to the legal system, would be to divide visible awards (or visible awards + lawyer costs) by total health care expenditures? And then to say, "oops, that's.5%, guess it's not a big deal, even if doctors spend half their salaries on liability insurance" ?
Yeah, but you have to be sure you're not just pushing the unfreeness onto another aspect. Let's take the simplest kind of NN, where literally every packet has to be treated the same. (Some people want this. Not necessarily informed people, but whatever.) Then someone can just send packets non-stop, and since they're sending more packet transfer requests (whatever those are called) everyone else has to get in line behind those "dummy" requests. It then becomes a competition to see who can flood the network the most in order to get through. This is sort of similar to the price cap/shortage problem. Keep the price too low, and the good gets rationed by aggressiveness, like a PS3 or Wii at launch.
And take a guess who's best at flooding the internet with data they don't really need to send?
I want to know if it's even possible to do a good, statistically-valid survey anymore.
How would you do it? Call people up? Sorry, that excludes all the people who use only VoIP or cell phones, because you can't call them. So, you know that your survey is already limited to mouth-breathers who still use POTS and talk to survey people.
Am I going out on a limb to say that that class of people has markedly different charasteristics than those outside of it, especially on Linux?
I'm going to offer the same solution I did for counting Firefox users:
1) Require a national ID number to download any Linux distro, and validation of ownership of this number through an in-person meeting with the local authorities.
2) Have the software "phone home" that it's actually being used, when it's used.
3) Close the source so that 2) can be facilitated.
4) Made the ID numbers and contact information in 1) publicly available so anyone can audit the official count of users.
There, done, you've got everyone counted. Wasn't that easy?
Yeah, good point, Zonk. I just hate when people are sensationalistic and biased about reporting gaming news. I'm glad you're doing your part to keep that kind of thing from happening.
If you found an infinite energy source, you'd probably be pretty mum about how it works so you can milk it for money as long as possible by selling energy.
Well, I'm not totally clear on what you mean by "they can only do that once". They do that 24x7x365.
By "that" I mean "expropriate your wealth". In other words, the FIRST time they deny 1:1 convertibility, they have transfered real wealth (actually a claim thereto, but same diff here) from you, but every point thereafter, market prices accurately reflect this capriciousness and any time you are paid, you get the full value, because the person paying you must pay more since the dollars are worth less, and interest rates advance to capture the inflation, preserving your cash value if you keep it in a bank (see below).
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?...
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?
Well, I was under the impression that you have to accept dollar bills for debts and you cannot refuse them.
You cannot refuse them as payment for debts specified in US Dollars. You're still free not to accept USDs as payment altogether. For that, you can blame your customers (and clients and employers which are types of customers).
This isn't an unjust requirement, merely an implication of the wrongness of fraud. It did, of course, screw over people before say 1900, who specified debts in USDs thinking they would get gold... but that obviously doesn't apply to today's traders.
And just because I can transfer them to another form does not justify the original threat of violence.
I don't think the Fed today has any powers that a private company doesn't have, other than the historical inertia advantage. Printers of Magic cards have the right to print all the cards they want, since they don't claim convertibility, and neither does the Fed. The Fed has a monopoly on printing its "official" notes, just as anyone else with a copyright or trademark would. (Correct me if I'm wrong here.)
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.
See above -- your $100 in 1950 will buy equally-good goods today if you had kept it in a bank.
Not until you renounce your heathen Fed-loving ways and return to the TRUE WAY.
LOL! How many times do I have to say it? I don't love the Fed. You and I are in many respects on the same page. I just can't accept that the harms of it are that big a deal. The worst thing you can come up with is "they make me suffer the injustice of using banks".
Irrelevant. Lengthen your attention span. The point I was making was that that (multi-stage) financial transaction involves a promise. Whether the bank can recoup its loan's value on default is irrelevant to the question of whether the transaction's value hinges on a promise (to cede the house on non-payment, whether or not it covers the principle). Certainly, a mortgage on the same terms except without the right to foreclose on the debtor, is worth less. So try again to explain your objection to financial transactions that hinge on a promise.
Not everyone is as trustworthy or as responsible as you or I.
Uh huh -- and that's why loans have a risk premium. A riskier loan *that promises the same payments at the same times* will be worth *less* if you sell the loan to someone. (In other words, it charges a higher interest rate.) It is not necessarily worth *zero*. The credit industry already does a decent (though with a small fraction of outliers) job of gauging risk.
And I don't have a problem with credit at all. It's credit backed currency I have a problem with, for various reasons.
The reasons you've given don't seem to make sense. A loan can have a current market value and be sold, just like gold. And transactions involving gold also involve promises. Yet you seem to believe that ownership of a loan (i.e. right to the income promised under the loan) isn't "real backing". Yet it is not much different from owning gold. I can sell gold for money now. I can sell a loan (i.e. the right to the future payments from the loan) for money now.
I think you missed my point. If the money supply to the economy is increasing at 10% per year, the 3% which hits the high street and increases commodity prices is called inflation. The 7% stock market increases are called growth. In reality it's mostly the same phenomenon in different places. Whether the liquidity goes into the stock market, high street inflation, bonds or whatever is frankly culture, psychology etc.
But under this theory, how can money inflate goods' prices without inflating, by the same amount, the value of the companies selling them. It seems the inflation-induced gain to both would have to be equal, since higher final-goods prices must feed directly into their sellers' market values (i.e. their stock).
Okay, I agree -- in that instance, the claim is fraudulent and the chip issuer has screwed the players. No argument there.
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. They know what the fed/chip issuer is doing to the currency and, for all future bets (in the poker game), they know to mentally account the chips as 1/10 of their face value (or whatever) for purposes of estimating losses. 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.
So yes, the Fed screwed over people before, but now its inflation is priced into the currency, and interest rates compensate for its future devaluation.
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.
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.
What violence? You're not personally required to accept USDs, and even if you do, you can instantly convert them to your preferred store of value if you think it will do better.
Look, I don't like defending the Fed, but over time, 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.
Oh, and put me back on your friends list, you vindictive knave.
Wow, I'm surprised this has withstood constitutional challenge. I mean, you're *required* to report income, which is in essence, a confession to a crime. I don't know how you can more clearly violate the fifth amendment right against self-incrimination.
LOL. Yes of course... What's it backed by? A promise. Really that's it. The monetary system is backed by trillions of promises. No problems there then, and, credit card debt is unsecured (even if that wasn't a farce).
It's hard to see how any multi-stage financial transaction could ever be acceptable to you. A mortgage is backed by a PROMISE to cede the house on non-payment. A share of stock is backed by the PROMISE to acknowledge your voting rights in that busines and to pay you proportional dividends. A checking account is backed by the PROMISE to redeem checks written against it for dollars. Even on a gold standard, dollars are only backed by the PROMISE to actually redeem them at the predefined rate.
So, what's exactly wrong with backing something with a promise?
Most of the growth on the stock market is simply inflation. Increased supply of money making it's way into the the investment markets. It just isn't called inflation. Sure some companies increase efficiency and profitability, but most of it's just soaked up liquidity.
Not true. Stock market nominal (not-inflation-adjusted) returns have been ~11% since 1927, while inflation (CPI) has averaged ~3.5%, tops. Google it if you don't believe me, but that's pretty well-accepted. And before you object to the inflation calculation methodology, let me again sympathize. It certainly seems like inflation is understated. And maybe wages don't keep up. But if you want to convince me that inflation's ravaging of the value of invested money is bigger, name the basket of commodity futures I can buy that predictably appreciates faster than the official inflation rate. If inflation is really higher than official CPI, there should be corresponding commodity derivatives reflecting these real prices, and I would like to invest and get these high risk-adjusted returns.
(Incidently, for various reasons, I think an insulin price index would be the best measure, since demand and supply are stable and you can't debase the product in response to inflation, but I can't find one.)
Let me preface this by saying I don't like government control of the money supply for the same reason I don't like government control of anything. However, that's no reason to permit flawed arguments against either, which is why I feel the need to address these points (I'd do the same for someone too gung-ho about the Federal Reserve):
What it comes down to is that our current monetary system directly related to how much debt we have. The more debt, the more money and vice versa. Lenders make money on the interest of funds promised to be paid back - those funds don't really exist (or at least most of those funds don't - a fractional portion does).
I don't understand this: they are being paid in some medium that can purchase real goods. That's all it needs to be real money.
Let's say a bank has $1,000 in the vault. In a fractional reserve system with a fractional reserve ratio of 9:1, the bank is allowed to lend up to $9,000 based on the $1,000 it has and since the federal reserve system is a closed circuit of banks, the money lent from one bank will be necessarily deposited into another bank wherein that bank can lend out a fractional percentage of the deposit (which was imaginary money from the first bank). You can see after a few iterations of this, you've generated enormous amounts of fictional money from very little actual money all based on the promise of the borrow to repay the amount borrowed.
First of all, the bank is lending $9000 out of $10,000 that was deposited in it. Instead of having $10,000 in the vault, it has $1,000 and $9000 worth of bonds (loans). All of the money it lent is backed.
Because the system is so prevalent and there's so much support in the federal reserve system the only way to create a real run on the bank (which would likely cause the collapse of the system) is to have everyone, everywhere withdraw all their money at the same time -- clearly something that could not happen because the bank doesn't really have the money to back up the numbers in your accounts.
If that happened, the Federal Reserve would, as lender of last resort, buy the banks' loans at par value. (Part of its goal is to maintain liquidity in the loan market so you can get the "full price" of a loan you sell, when you'd otherwise have to wait for someone to be available.) If this sudden desire to hoard caused the banks' debtors not to be able to repay their loans, the Federal Reserve would eat the loss.
Likewise, if we were to eliminate all debt, the circulating money would cease to grow because there would be no debt on which to gain interest nor any need to pull new money into existence for a loan and they system would collapse because the value of the paper money is in reality not backed by anything of value.
Even if no one, at any positive interest rate, ever borrowed money, you could still grow your money by buying shares of businesses. All that's necessary for the money to grow is that people not save all of their money.
So, you don't think dividends should be taxed, and all investors are overlooking a way to defer taxation of their dividends?
(Remember: simply delaying the point at which you are taxed on your total gain can increase your returns, even though you "still pay taxes" at some point.)
Okay, whatever manipulation of the monetary system the Federal Reserve does, individual member banks aren't actually allowed to print money at will. They banks still have to pay interest on the borrowed money. I hope you were joking about that.
Anyway... do contact-full transactions really add any security? I always hear "omg if someone steals ur card their sig will b diff so they know its not urs lol!" But really -- it doesn't prevent the transaction itself, since the cashier ignores the signature entirely. And it requires that I use an actual, unique signature (instead of just scribbling) when I really want to authroize the purchase -- which the CC company doesn't actually require you to do. So I can just scribble for all my signatures and if I want to dispute the charges at the Dog and Duck Pub, they don't have any real proof because my signature there is the same as elsewhere.
Slashdot Mirror
it consumes 2GB of memory. Yes, 2GB of memory for 100MB of input data. This is not a real-world algorithm; this is CS weenies wanking off.
... that would actually be better than what they did, if what you're saying is true :-P
If that's true (and this is important), then I'd have to agree with you. Compressing only one data stream, with an algorithm longer than the data stream, is not compression. Oddly enough, in my last post, I was just joking about how you could cheat by having the algorithm be:
0 = 0
1 = [entire wikipedia database]
And say, "Hah, I compressed it to 1!"
But then
Compression key:
0 = 0
1 = Wikipedia, the free encyclopedia. Welcome to
And then stored Wikipedia as "1". And you'd be correct, that you can give a false "improvement" in the compression by stuffing the informational complexity within the compression algorithm and completely destroy its usefulness. It would be great for one very specific datastream, but nothing else.
More generally, if you want a compression algorithm for an arbitrary data stream, you need to rely on some kinds of patterns being in it, that are inherent to the kind of data it is. Truly random data can have no compression because the average length in compressed form will be no shorter -- there are no patterns to exploit.
Good point, but I'm not sure if I said what you were looking for
Wait -- for all your complaining about health-related fud, aren't you the one who thinks a valid way to calculate fraction of health care costs due to the legal system, would be to divide visible awards (or visible awards + lawyer costs) by total health care expenditures? And then to say, "oops, that's .5%, guess it's not a big deal, even if doctors spend half their salaries on liability insurance" ?
Well, not always...
American --> British
transportation --> transport
football player --> footballer
subway --> tyube
burglarize --> burgle
Yeah, but you have to be sure you're not just pushing the unfreeness onto another aspect. Let's take the simplest kind of NN, where literally every packet has to be treated the same. (Some people want this. Not necessarily informed people, but whatever.) Then someone can just send packets non-stop, and since they're sending more packet transfer requests (whatever those are called) everyone else has to get in line behind those "dummy" requests. It then becomes a competition to see who can flood the network the most in order to get through. This is sort of similar to the price cap/shortage problem. Keep the price too low, and the good gets rationed by aggressiveness, like a PS3 or Wii at launch.
And take a guess who's best at flooding the internet with data they don't really need to send?
That's simple -- it's just like the difference between swimming, and what a submarine does.
Wait, that didn't help, did it?
I want to know if it's even possible to do a good, statistically-valid survey anymore.
How would you do it? Call people up? Sorry, that excludes all the people who use only VoIP or cell phones, because you can't call them. So, you know that your survey is already limited to mouth-breathers who still use POTS and talk to survey people.
Am I going out on a limb to say that that class of people has markedly different charasteristics than those outside of it, especially on Linux?
I'm going to offer the same solution I did for counting Firefox users:
1) Require a national ID number to download any Linux distro, and validation of ownership of this number through an in-person meeting with the local authorities.
2) Have the software "phone home" that it's actually being used, when it's used.
3) Close the source so that 2) can be facilitated.
4) Made the ID numbers and contact information in 1) publicly available so anyone can audit the official count of users.
There, done, you've got everyone counted. Wasn't that easy?
Hey, just because it's an old metaphor, doesn't mean it's any good :-P
A metaphor of a different understandability.
"Horse of a different color"? WTF?
Yeah, but you don't understand: they couldn't afford to save money.
Yeah, good point, Zonk. I just hate when people are sensationalistic and biased about reporting gaming news. I'm glad you're doing your part to keep that kind of thing from happening.
Actually, SL is pretty good about IP. You can imbue items with "no copy" proprties and stuff like that.
Posting from a Wii btw.
You mean the person exploiting the pheromes? No, they seem pretty smart.
I'm posting from a Wii btw.
If you found an infinite energy source, you'd probably be pretty mum about how it works so you can milk it for money as long as possible by selling energy.
Well, I'm not totally clear on what you mean by "they can only do that once". They do that 24x7x365.
...
... 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?
... but that obviously doesn't apply to today's traders.
By "that" I mean "expropriate your wealth". In other words, the FIRST time they deny 1:1 convertibility, they have transfered real wealth (actually a claim thereto, but same diff here) from you, but every point thereafter, market prices accurately reflect this capriciousness and any time you are paid, you get the full value, because the person paying you must pay more since the dollars are worth less, and interest rates advance to capture the inflation, preserving your cash value if you keep it in a bank (see below).
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?
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
Well, I was under the impression that you have to accept dollar bills for debts and you cannot refuse them.
You cannot refuse them as payment for debts specified in US Dollars. You're still free not to accept USDs as payment altogether. For that, you can blame your customers (and clients and employers which are types of customers).
This isn't an unjust requirement, merely an implication of the wrongness of fraud. It did, of course, screw over people before say 1900, who specified debts in USDs thinking they would get gold
And just because I can transfer them to another form does not justify the original threat of violence.
I don't think the Fed today has any powers that a private company doesn't have, other than the historical inertia advantage. Printers of Magic cards have the right to print all the cards they want, since they don't claim convertibility, and neither does the Fed. The Fed has a monopoly on printing its "official" notes, just as anyone else with a copyright or trademark would. (Correct me if I'm wrong here.)
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.
See above -- your $100 in 1950 will buy equally-good goods today if you had kept it in a bank.
Not until you renounce your heathen Fed-loving ways and return to the TRUE WAY.
LOL! How many times do I have to say it? I don't love the Fed. You and I are in many respects on the same page. I just can't accept that the harms of it are that big a deal. The worst thing you can come up with is "they make me suffer the injustice of using banks".
Is Ubuntu a good distro in this case, given as it's already installed? I mean, from the standpoint of a non-geeky computer user.
uhuh. Can you define the value of the house? ...
Irrelevant. Lengthen your attention span. The point I was making was that that (multi-stage) financial transaction involves a promise. Whether the bank can recoup its loan's value on default is irrelevant to the question of whether the transaction's value hinges on a promise (to cede the house on non-payment, whether or not it covers the principle). Certainly, a mortgage on the same terms except without the right to foreclose on the debtor, is worth less. So try again to explain your objection to financial transactions that hinge on a promise.
Not everyone is as trustworthy or as responsible as you or I.
Uh huh -- and that's why loans have a risk premium. A riskier loan *that promises the same payments at the same times* will be worth *less* if you sell the loan to someone. (In other words, it charges a higher interest rate.) It is not necessarily worth *zero*. The credit industry already does a decent (though with a small fraction of outliers) job of gauging risk.
And I don't have a problem with credit at all. It's credit backed currency I have a problem with, for various reasons.
The reasons you've given don't seem to make sense. A loan can have a current market value and be sold, just like gold. And transactions involving gold also involve promises. Yet you seem to believe that ownership of a loan (i.e. right to the income promised under the loan) isn't "real backing". Yet it is not much different from owning gold. I can sell gold for money now. I can sell a loan (i.e. the right to the future payments from the loan) for money now.
I think you missed my point. If the money supply to the economy is increasing at 10% per year, the 3% which hits the high street and increases commodity prices is called inflation. The 7% stock market increases are called growth. In reality it's mostly the same phenomenon in different places. Whether the liquidity goes into the stock market, high street inflation, bonds or whatever is frankly culture, psychology etc.
But under this theory, how can money inflate goods' prices without inflating, by the same amount, the value of the companies selling them. It seems the inflation-induced gain to both would have to be equal, since higher final-goods prices must feed directly into their sellers' market values (i.e. their stock).
Oh, so I can evade taxes OR confess to a crime OR commit perjury. I guess it's kosher then. :-P
[poker story]
Okay, I agree -- in that instance, the claim is fraudulent and the chip issuer has screwed the players. No argument there.
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. They know what the fed/chip issuer is doing to the currency and, for all future bets (in the poker game), they know to mentally account the chips as 1/10 of their face value (or whatever) for purposes of estimating losses. 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.
So yes, the Fed screwed over people before, but now its inflation is priced into the currency, and interest rates compensate for its future devaluation.
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.
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.
What violence? You're not personally required to accept USDs, and even if you do, you can instantly convert them to your preferred store of value if you think it will do better.
Look, I don't like defending the Fed, but over time, 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.
Oh, and put me back on your friends list, you vindictive knave.
Wow, I'm surprised this has withstood constitutional challenge. I mean, you're *required* to report income, which is in essence, a confession to a crime. I don't know how you can more clearly violate the fifth amendment right against self-incrimination.
LOL. Yes of course... What's it backed by? A promise. Really that's it. The monetary system is backed by trillions of promises. No problems there then, and, credit card debt is unsecured (even if that wasn't a farce).
It's hard to see how any multi-stage financial transaction could ever be acceptable to you. A mortgage is backed by a PROMISE to cede the house on non-payment. A share of stock is backed by the PROMISE to acknowledge your voting rights in that busines and to pay you proportional dividends. A checking account is backed by the PROMISE to redeem checks written against it for dollars. Even on a gold standard, dollars are only backed by the PROMISE to actually redeem them at the predefined rate.
So, what's exactly wrong with backing something with a promise?
Most of the growth on the stock market is simply inflation. Increased supply of money making it's way into the the investment markets. It just isn't called inflation. Sure some companies increase efficiency and profitability, but most of it's just soaked up liquidity.
Not true. Stock market nominal (not-inflation-adjusted) returns have been ~11% since 1927, while inflation (CPI) has averaged ~3.5%, tops. Google it if you don't believe me, but that's pretty well-accepted. And before you object to the inflation calculation methodology, let me again sympathize. It certainly seems like inflation is understated. And maybe wages don't keep up. But if you want to convince me that inflation's ravaging of the value of invested money is bigger, name the basket of commodity futures I can buy that predictably appreciates faster than the official inflation rate. If inflation is really higher than official CPI, there should be corresponding commodity derivatives reflecting these real prices, and I would like to invest and get these high risk-adjusted returns.
(Incidently, for various reasons, I think an insulin price index would be the best measure, since demand and supply are stable and you can't debase the product in response to inflation, but I can't find one.)
Let me preface this by saying I don't like government control of the money supply for the same reason I don't like government control of anything. However, that's no reason to permit flawed arguments against either, which is why I feel the need to address these points (I'd do the same for someone too gung-ho about the Federal Reserve):
What it comes down to is that our current monetary system directly related to how much debt we have. The more debt, the more money and vice versa. Lenders make money on the interest of funds promised to be paid back - those funds don't really exist (or at least most of those funds don't - a fractional portion does).
I don't understand this: they are being paid in some medium that can purchase real goods. That's all it needs to be real money.
Let's say a bank has $1,000 in the vault. In a fractional reserve system with a fractional reserve ratio of 9:1, the bank is allowed to lend up to $9,000 based on the $1,000 it has and since the federal reserve system is a closed circuit of banks, the money lent from one bank will be necessarily deposited into another bank wherein that bank can lend out a fractional percentage of the deposit (which was imaginary money from the first bank). You can see after a few iterations of this, you've generated enormous amounts of fictional money from very little actual money all based on the promise of the borrow to repay the amount borrowed.
First of all, the bank is lending $9000 out of $10,000 that was deposited in it. Instead of having $10,000 in the vault, it has $1,000 and $9000 worth of bonds (loans). All of the money it lent is backed.
Because the system is so prevalent and there's so much support in the federal reserve system the only way to create a real run on the bank (which would likely cause the collapse of the system) is to have everyone, everywhere withdraw all their money at the same time -- clearly something that could not happen because the bank doesn't really have the money to back up the numbers in your accounts.
If that happened, the Federal Reserve would, as lender of last resort, buy the banks' loans at par value. (Part of its goal is to maintain liquidity in the loan market so you can get the "full price" of a loan you sell, when you'd otherwise have to wait for someone to be available.) If this sudden desire to hoard caused the banks' debtors not to be able to repay their loans, the Federal Reserve would eat the loss.
Likewise, if we were to eliminate all debt, the circulating money would cease to grow because there would be no debt on which to gain interest nor any need to pull new money into existence for a loan and they system would collapse because the value of the paper money is in reality not backed by anything of value.
Even if no one, at any positive interest rate, ever borrowed money, you could still grow your money by buying shares of businesses. All that's necessary for the money to grow is that people not save all of their money.
So, you don't think dividends should be taxed, and all investors are overlooking a way to defer taxation of their dividends?
(Remember: simply delaying the point at which you are taxed on your total gain can increase your returns, even though you "still pay taxes" at some point.)
Okay, whatever manipulation of the monetary system the Federal Reserve does, individual member banks aren't actually allowed to print money at will. They banks still have to pay interest on the borrowed money. I hope you were joking about that.
... do contact-full transactions really add any security? I always hear "omg if someone steals ur card their sig will b diff so they know its not urs lol!" But really -- it doesn't prevent the transaction itself, since the cashier ignores the signature entirely. And it requires that I use an actual, unique signature (instead of just scribbling) when I really want to authroize the purchase -- which the CC company doesn't actually require you to do. So I can just scribble for all my signatures and if I want to dispute the charges at the Dog and Duck Pub, they don't have any real proof because my signature there is the same as elsewhere.
Anyway