debt free fiat currency – a solution to deflation and inflation?

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  • Tue, Dec 21, 2010 - 02:38pm

    #41
    Peak Prosperity Admin

    Peak Prosperity Admin

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    Re: debt free fiat currency – a solution to deflation and …

“This is where you are wrong!   It was not selected by the market.”

Well, the dutch, swedes and British at least, were all using it long before the Americans setup any kind of banking system for themselves.

And FRB had evolved independantly in the native Mughal Empire of India from the 18th century onwards. And of course Italian and German bankers were employing a fractional reserve approach to funding european monarchs and, ironically, the discovery and exploration of America.

FRB may be dangerous at times but it is far more efficient than any kind of full reserve approach and therefore one would expect markets to pick it. The losses associated with various financial crisis have been more than offset by the increase in efficiency of the economy for the last 500 years.

 

 

 

 

 

  • Mon, Sep 26, 2011 - 09:56am

    #42
    SPAM_Jason09

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    default on the debt ceiling

the default on the debt ceiling is a situation that is completely unthinkable of. This is because, the default is mainly gong to increase the interest rates, this as result will lead to a situation where most of the people will be unable to afford homes. If the interest rates increase it will lead to the lenders asking for higher payments. Furthermore, if the nation defaults on its debt, many people will have to lose their jobs. Thus, it becomes quite obvious that most will not be able to make any kind of debt payments and will not be able to buy homes. This will again affect the real estate market. The affordability of the people will lower and the debt situation of the country and the people will worsen all the more. visit http://www.debtconsolidationcare.com/

  • Mon, Sep 26, 2011 - 04:07pm

    #43

    rhare

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    Force by govenrment does not a market make.

[quote=scepticus]

Well, the dutch, swedes and British at least, were all using it long before the Americans setup any kind of banking system for themselves.

And FRB had evolved independantly in the native Mughal Empire of India from the 18th century onwards. And of course Italian and German bankers were employing a fractional reserve approach to funding european monarchs and, ironically, the discovery and exploration of America.

FRB may be dangerous at times but it is far more efficient than any kind of full reserve approach and therefore one would expect markets to pick it. The losses associated with various financial crisis have been more than offset by the increase in efficiency of the economy for the last 500 years.

[/quote]

None of this shows that it was chosen by the market, in fact far from it.  It will always be chosen by governments and bankers, because when you have a FRB system it greatly benefits the financial and political sector at the detriment of others.

As I have said many times, I have no problem with FRB being an option, but no currency is "valid" IMO if it is not subject to competition.  Until you have competition in money just as you must have in everything else you will never know if it is serving it’s purpose of being a measuring stick of the value of products and capital.

[quote=scepticus]

The losses associated with various financial crisis have been more than offset by the increase in efficiency of the economy for the last 500 years

[/quote]

And how do you know that? This is just like all the politicians saying it would have been worse had we not done X.

 

  • Tue, Jan 10, 2012 - 11:12pm

    #44

    Robbrian

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    darbikrash — reply

Snap Snap!!! Thanks for the response to an otherwise undefensible position in light of modern government’s role in an ever growing social democracy.

Some remain in cognitive dissonance of the world the way it is rather than the way they would like it to be.  Caught in that contradiction leaves little room for objectivity.

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