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Sunday, Nov 8, 2009
Are you saying that "Free Market" economics as practiced by the frauds in the Republican Party does not work because it is crony fascism rather than true laissez-faire economics?
Or, are you saying that laissez-faire economics can not work no matter what it is called?
Never get in a go-cart and ride off a bridge to `No Where, Timbuckteethtoo....
If you don't have the audacity, and peoples flow of information is nauseating...
If verbiage is doubtful, and there seems to be no veracity, no get too car sick...
I watched Sarah Palin highlights the other day and all of a sudden it hit me. She reminds me to the T of Dana Perino. The same kind of obfuscation, sell the party line spew and Never, Never, answer the goddamn questions. This administrations has used the WH press briefings to ignore the press and turn it into a PR event. Sarah Plain is nothing more than a PR stooge. Wonder how many David Addingtons and Scooter Libbys will be working for her if they win. That's something to consider and frankly, as Eric Cantor would say, frankly, it scares the hell out of me.
This is for the fellow who claimed up thread that he simply hated bankers. If one hates a class of people then one should at least hate them for what they really are and not hate them due to not understanding them. Hence, a little lesson in banking.
Rothbard:
We have already described one part of the contemporary flight from sound, free market money to statized and inflated money: the abolition of the gold standard by Franklin Roosevelt in 1933, and the substitution of fiat paper tickets by the Federal Reserve as our "monetary standard." Another crucial part of this process was the federal cartelization of the nation's banks through the creation of the Federal Reserve System in 1913.
Banking is a particularly arcane part of the economic system; one of the problems is that the word "bank" covers many different activities, with very different implications. During the Renaissance era, the Medicis in Italy and the Fuggers in Germany, were "bankers"; their banking, however, was not only private but also began at least as a legitimate, non-inflationary, and highly productive activity. Essentially, these were "merchant-bankers," who started as prominent merchants. In the course of their trade, the merchants began to extend credit to their customers, and in the case of these great banking families, the credit or "banking" part of their operations eventually overshadowed their mercantile activities. These firms lent money out of their own profits and savings, and earned interest from the loans. Hence, they were channels for the productive investment of their own savings.
To the extent that banks lend their own savings, or mobilize the savings of others, their activities are productive and unexceptionable. Even in our current commercial banking system, if I buy a $10,000 CD ("certificate of deposit") redeemable in six months, earning a certain fixed interest return, I am taking my savings and lending it to a bank, which in turn lends it out at a higher interest rate, the differential being the bank's earnings for the function of channeling savings into the hands of credit-worthy or productive borrowers. There is no problem with this process.
... [skipping a lot] ...
Fractional Reserve Banking
Let's see how the fractional reserve process works, in the absence of a central bank. I set up a Rothbard Bank, and invest $1,000 of cash (whether gold or government paper does not matter here). Then I "lend out" $10,000 to someone, either for consumer spending or to invest in his business. How can I "lend out" far more than I have? Ahh, that's the magic of the "fraction" in the fractional reserve. I simply open up a checking account of $10,000 which I am happy to lend to Mr. Jones. Why does Jones borrow from me? Well, for one thing, I can charge a lower rate of interest than savers would. I don't have to save up the money myself, but simply can counterfeit it out of thin air. (In the nineteenth century, I would have been able to issue bank notes, but the Federal Reserve now monopolizes note issues.) Since demand deposits at the Rothbard Bank function as equivalent to cash, the nation's money supply has just, by magic, increased by $10,000. The inflationary, counterfeiting process is under way.
... [skipping a lot yet again] ...
Central Banking
Hence the drive by the bankers themselves to get the government to cartelize their industry by means of a central bank. Central Banking began with the Bank of England in the 1690s, spread to the rest of the Western world in the eighteenth and nineteenth centuries, and finally was imposed upon the United States by banking cartelists via the Federal Reserve System of 1913. Particularly enthusiastic about the Central Bank were the investment bankers, such as the Morgans, who pioneered the cartel idea, and who by this time had expanded into commercial banking.
[... much more in lesson ...]
Much more; read if you give a damn about some of the problems that our country faces. Or, not. The short version is, that the system is set up for your masters to fleece you and one of your secular deities was there to help set it up. Imagine that!
Side note: It amazes me how many people think Mises was a "kook" (or Rothbard in his turn) because he thought that the study of economics was a study of why men act as they do. The whole "Austrian school" is predicated on studying the rational human actors in the system. Well, you do have to believe that "people are people" no matter what part of the world you find them in. I do. Yes, even if they are brown and wear cloth things on their head. And yes, people often get fooled by sharp frauds, but they act rationally on the information at hand in the main.
http://www.lewrockwell.com/rothbard/frb.html
or click on sig ...
Here's what I posted yesterday:
my typo
should read "it was the reps 1/01-6/01"
-- Gratefule Live
[Read Gratefule Live's other letters]
Permalink Saturday, October 4, 2008 03:18 PM
Greenwald wrong re Dem Senate control 2000 -2002
Don't let facts interfere, but the Dems did not control the Senate for all of 2001 and the Reps did not control it for all of 2002. It was the Reps until1/01- 6/01 (Jeffords left the Rep party), and the Reps took it back 1/03. I'll do Greenwald the way he'd do Palin: if he gets this wrong (see his diagram) he probably knows nothing. And if I misread his diagram he doesn't know how to draw.
-- Gratefule Live
This AM I see Greenwald corrected, which is fine, but I don't see notice of update, which this site normally is assiduous about...no big deal, but newspaper hasn't arrived yet and I have some time to kill. Hey Greenwald...you're OK in my book.
Much of the initial coverage about Fort Hood turned out to be wrong. Is there anything wrong with that?
The accountability imposed by another country for the CIA's kidnapping and torture reveals much about our own.
Fox News' morning show plays to type, talking about whether Muslims in the Army should face "special debriefings"
The survivor and author is upset about comparisons some on the right are making to genocide
Once seen as a lunatic fringe, reactionary anti-women groups are courting respectability
Salon headlines in your mailbox
