Frank Shostak is a particularly good explainer of matters economic, and he explains inflation policy recommendations here. But like so many Austrians who know what they are talking about, he gets the term money wrong from time to time.
At a party last night a fellow said in passing of my friend who just drew 16 years for financial shenanigans, in which a supposed $20 million loss was taken, "there is $20 million out there somewhere." What? No there isn't. Nobody lost $20 million because no one ever had it to begin with. Investors came to the financial advisor with tallies, promises to be paid in money, hoping to multiply the tallies and then have more asset-less backed credit buying power. Problem is, we have mostly a false economy, in which it is not possible to ever generate the money necessary to cover all of the promises. instead of factories making toasters, America's pensions are strewn over the battle fields of the Middle East, and tucked away in the foreign accounts of top level USA officials.
The problem with the recommendations being made by the Fed potentates is they will work. But they are designed to help only and extremely few people, with countless patsies lining up to be taken, and others forced to participate by putting money in IRAs and 401ks to escape the chaos of our tax code.
If and when the system comes down, we'll need a strict separation of money (and credit) and the state.
Feel free to forward this by email to three of your friends.
On the contrary the holders of newly printed money who don’t produce any real wealth will weaken the ability of wealth generators to produce wealth by diverting to themselves bread and shoes thereby leaving less real wealth to fund the maintenance and the expansion of the infrastructure.If it can be newly printed, it ain't money. Getting back to Mish on deflation, Shostak as well demonstrates there is nothing on the other side of these investments. There is no way to calculate how bad things are until people realize there is no asset to match most of what is called "money" owed.
At a party last night a fellow said in passing of my friend who just drew 16 years for financial shenanigans, in which a supposed $20 million loss was taken, "there is $20 million out there somewhere." What? No there isn't. Nobody lost $20 million because no one ever had it to begin with. Investors came to the financial advisor with tallies, promises to be paid in money, hoping to multiply the tallies and then have more asset-less backed credit buying power. Problem is, we have mostly a false economy, in which it is not possible to ever generate the money necessary to cover all of the promises. instead of factories making toasters, America's pensions are strewn over the battle fields of the Middle East, and tucked away in the foreign accounts of top level USA officials.
The problem with the recommendations being made by the Fed potentates is they will work. But they are designed to help only and extremely few people, with countless patsies lining up to be taken, and others forced to participate by putting money in IRAs and 401ks to escape the chaos of our tax code.
If and when the system comes down, we'll need a strict separation of money (and credit) and the state.
Feel free to forward this by email to three of your friends.
0 comments:
Post a Comment