Control the money supply like DeBeers controls diamonds

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burritos's picture
burritos
Status: Member (Offline)
Joined: Jul 9 2008
Posts: 2
Control the money supply like DeBeers controls diamonds

To have hyperinflation, does it matter what the distribution of wealth is like to get too hyperinflation or is it just the presence of the excess fiat currency enough to trigger the inflation?
For example, if you have 101 people in a closed system where there is 1 billion and 1 million dollars circulating. In scenario A 1 person has a billion and the other 100 split 1 million dollars. In scenario B the 101 people equally have a share of the 1 billion and 1 million. Intuitively I see scenario B as a more inflationary scenario where as scenario A is dependent on how B acts. Sort of like DeBeers. Supposedly they have enough diamonds to fit every female with a 1 karat ring, but by controlling the flow of diamonds into the public and using a sophisticated marketing scheme, they have been able to maintain the value of the diamond despite their seemingly infinite supply. Can't that happen with money?

gsti's picture
gsti
Status: Bronze Member (Offline)
Joined: Jul 21 2008
Posts: 60
:) burritos, thats socialism!

The control of the money supply has been a hotly debated idea for a long time, to control the money supply like you suggest also ends up requiring some control of production, so the money supply increases to meet the capabilities of production. Money supply only seems to be created fast enough through the fractional reserve system.  Your suggestion has some interesting social and political arguments.  Try this:

 http://ia350629.us.archive.org/3/items/EuropeanSocialism/EuropeanSocialism.lit

or this

http://www.oswaldmosley.com/downloads/The%20Coming%20Corporate%20State.lit

Microsoft document reader is required.

These sort of ideas in the form of superstates were proffered by the National Socialists before and after the war.  Not dissimilar to Il duce, but a bit more refined, and very very close to what the EU is now.  I am sure it will seem like a good idea until we get it. 

Johnny Oxygen's picture
Johnny Oxygen
Status: Diamond Member (Offline)
Joined: Sep 9 2009
Posts: 1443
Re: Control the money supply like DeBeers controls diamonds

Hi Darren Hill!

Hi Burritos!

Welcome to CM.

Control the money supply like DeBeers controls diamonds

The problem is in the statement.

 Bankers control money, governments, societies, etc.

The last thing bankers want is an even, steady, dependable economy. You can't make windfall profits that way. Bankers want really big boom/bust cycles. The game is pretty simple. Ease credit, let people saturate themselves in debt of real assets then constrict lending causing them to default on their debt. This way the bankers aquire the real assets and there is a huge transfer of wealth to the few at the top. This consolidates power and allows the game to continue.

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