Western World Economics.

I have been thinking lately that the western world's woes re economy could be to do with the way we percieve the value of money. It stands to reason that a economy relying on capitalistic principals relies heavily on debt. If all the money that exists is in circulation is in somebody's possession doesn't it mean that for somebody or some company to get wealthier somebody or some company has to get poorer unless new money is put into the mix. For new money to be put into the mix there would need to be large projects either incidental (wars) or invented (government bonds for bridges, tunnels etc) for the banking industry to invest in. This or these  hypothetical projects would need to gaura ntee employment to generate spending and most importantly borrowing so as to enable the banks or investors to get a return on their investment. This implies that the value of the new money did not really exist at the time of printing-it only becomes apparent in the necessity for borrows to be employed because of the need to pay their borrowings back. This means that people need to be in debt for others (banks) to grow wealth. However one looks at this, there is apparent something sinister going on as far as I can see.

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Comments

  1. papabear
    your about right, the absolute basic is sell and buy , the value of your dollar is what you expect to get for it! the problem is that the circular model of our global economy means it is finite and also as you suggest stallable, so if those who have money don’t spend it the rest of can’t get it. with finite it means that the circle can only get so big before it just collapses. if you look at the new carbon trading thet it is a way of expanding the economic markets to increase capacity and generate new markets. It has bugger all to do with changing the climate it is a way of increasing revenue, and increasing market capacities. it then gets very complicated when you start looking into policies, market controls capital distribution. capital distribution at this time is very top heavy globally. the gap between rich and poor is growing, the money that Microsoft has for example , on paper, there is not enough US currency printed for them to have their funds in cash. global policy is steering to redress the balance with the usual kick and cry from the rich about having to pay extra taxes etc. it is interesting the American economy is backed by it’s gold reserve. now you are in a situation of owing trillions of dollars and instead of cutting spending increasing taxes especially on the extremely wealthy your government just increases the amount it borrows. consider that as a family, if the finance company you borrow from demand full payment and you haven’t got it you lose your house and goods, what the hell is the US going to do when it can no longer increase it loans will not increase it’s revenues? It is ok for the president and the die hard patriots to stand and waive the flag and say we are the greatest country in the world, but if the debt is called it could quickly become a state of China or one of it’s other creditors. printing more money does not help either, more cash means lesser value. Like every thing the rarer it is the more value is placed on it. so if you increase the number of notes available you need more to have the same purchase power. I am not sure how it would work ,but it is possible to fix the value of a currency, instead of floating on the international market. If you ,form tomorrow, increased the value of a currency by 10 fold in a fixed capacity you would effectively move the decimal point one place to the left that would mean that you would get forty dollars a week instead of 400 but a tin of beans would be 20c instead of $2 internally it would make little difference but export import it would make a huge difference but the problem is then will people buy your goods when it costs them 50 yen instead of 5? So it is a very tricky balancing act the key is level playing ground with enough free trade ability to keep money moving round and enough regulation to prevent the debacle of the GFC, and the greedy being able to prosper of the poorest sectors, it is my opinion that backs and lenders need to be further regulated as to charges and interest rates and how these are calculated, fair profit without crucifying the borrower, and now I have rambled all around the place and probably made little sense I am going to read something comical

    November 09, 2011
    1. wirelessguru1

      Well papabear, you usually make little to no sense with your posts so I am not that surprised with all of your mumbling and rambling here!

      Look, the bottom line that we need a new socio-economic system for the 21st century which is NOT based on debt.

      +1 (Neo)

      November 09, 2011
      1. papabear

        the bottom line is we do need a different system but to change the system the power first has to be taken out of the money Bhutan as the right idea i feel how happy is the population, happinest = success, I may have rambled but each point is valid !

        November 09, 2011
        1. wirelessguru1

          Of course the OLD (present) system MUST fail (or be destroyed) first…that goes without saying.

          November 09, 2011
          1. papabear

            it has to be done carefully transitional rather than confrontational, or the only ones to suffer will be the lower classes(for want of a better term

            November 09, 2011
            1. wirelessguru1

              Hello, hello, is anybody home? The lower class is ALREADY suffering! Please wake up!!!!

              November 09, 2011
              1. papabear

                ok you sound more like agent smith than neo ! I know we suffer now but if we go to war , civil or global do you imagine that we would suffer less than now and the wealthy would be un protected?

                November 09, 2011
                1. wirelessguru1

                  Say what!? Maybe your mind must be infected by the Smith virus!!!

                  Again, the lower classes and even middle classes are already suffering!!!!!!!!

                  November 09, 2011
              2. papabear

                itis possible thought to ease their suffering and change with out making it harder on them that is all i am saying

                November 09, 2011
                1. wirelessguru1

                  So what’s your plan??

                  November 10, 2011
    2. 29A

      ‘it is interesting the American economy is backed by it’s gold reserve. ’

      Dollars are fiat currency. Bretton-Woods was a gold standard, which the Nixon Shock unilaterally cancelled.

      The Federal Reserve simply ‘prints’ money as necessary.

      Lew Rockwell, 2008: http://mises.org/daily/3010

      November 09, 2011
  2. wirelessguru1

    That’s right. The problem is the debt-based system.

    November 09, 2011
  3. papabear

    WG1 there are some options but i think that to create change catastrophic failure needs to happen , that shouldn’t stop the attempt at peaceful means. we have the technology to move toward a true democracy where every person can vote on every issue, before we get there we need some basic changes to the tax systems and monetary controls like ceilings on individual wealth one you have $50,000,000
    why do you need $51,000,000 so we need to decide a wealth ceiling and impose a 100% after that point (including monies spent trying to avoid the tax ,like art works for the hell of it) if you do note want to pay the tax then any cash above the threshold can be donated to independent charities pick from list. now for the democracy bit, each person is identified by their bio metrics an implant chip could be utilised , just as detail, but terminals to input a rule or regulation you want considered then every one gets a chance to read then vote
    it is possible but there needs to be a lot of details sorted

    November 10, 2011
    1. wirelessguru1

      Look, the system will fail one way or another, and sooner than later now, since ALL (that means 100%) prior civilizations (systems) also all failed.

      Essentially you cannot stop the system from failing since they are designed to fail.

      But I do agree that FAILURE can be peaceful, however the damn ruling elites (the 1%) will still desperately try to fight to protect their old cash cows at all costs…

      Either case, the solution is a new system that is NOT based on debt and I, the one, personally prefer a stamped-money system since I believe that it would be more in tune with Nature and also with the conversion of natural reality with virtual reality…

      +1 (Neo)

      November 10, 2011
      1. papabear

        Stamped -money? not sure I know what you mean there but I think we are in the same ball park ,now that is ,in it’s self a scary, thought, we agree!!! we are already moving to a cashless system and that can be maintained, the problem is as you say, the cashed up not wanting to relinquish their hold on the money and power. so may be we should have an open season on them ???(just a thought anyone with cash and assets above X value are fair game march april may clean shots no traps) another issue is population control, those who cannot afford children are breading like rabbits we made 7billion from 6b in 12 years the next billion will be added in about 8yrs, with all the funds going to the top 1% that means that the bottom gets bigger and poorer ,

        essentially we need a forced redistribution of wealth and measures to control growth while at the same time moving toward a freer more equitable society that works on mutual benefit rather than cash and debt, I am now going to see if i can design such a system on paper, well computer screen

        November 10, 2011
        1. wirelessguru1

          Look, if you’re really interested in this stuff then you should definitely study (research) stamped-money or money that expires…

          You seem young and eager but not very knowledgebale and experienced as of yet…

          ..and please also try to work on your run-on sentences…

          +1 (Neo)

          November 11, 2011
          1. papabear

            young? that is the second time I have been called that in three days I am nearing50 , I will end up on stamped money but my initial thought is it would only create faster turnover and a greater need for debt because of the inability to save ,unless the cash component expires but the bank savings don’t. I realise I am a bugger for missing punctuation, but hey I am not the one who is perfect

            November 11, 2011
            1. wirelessguru1

              Faster turnover (speed of money) is great for the economy in general and the inability to save can be easily addressed in several ways. Either case, the majority of people are ALREADY living from pay check to pay check!

              ..and even I, the one, am not perfect…

              November 11, 2011
              1. papabear

                I have started reading up on stamped money and I see some issues but need to read the rest of the idea to see what is addressed and what is not. get back to you on what i find and think shortly

                November 11, 2011