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| Joined: | Mon Nov 21st, 2005 |
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An example of the free market working can be illustrated with a walk-in customer at my wife's Real Estate business where I am currently being employed as an assistant (while I continue to recuperate).
The walk in is a Muslim who wants to buy an old building and turn it into a church (the building is the place where my Wife and I were married).
I find out that this Muslim person is short on cash and he has no credit with the dollar suppliers who supply cash. I ask if he has ever heard of Islamic Banking, and he reports that he has and that he is going to look into that source of cash.
I asked him to please return if he is successful.
I have not seen that Muslim person since that discussion; it has been a few months.
Islamic Banking may require many hurdles to jump, many strict requirements, qualifications, etc. to earn the credit to borrow money, and that is the cost, while Islamic Banking charges no interest.
In other words; a house will cost the buyer of the house the price of the house instead of the house requiring from the borrower of interest earning loans the price of two houses.
A. one house costing the price of one house (one house one cost)
B. one house costing the price of two houses (one cost goes to the seller of the house and the other entire cost of the house goes to the bank as “interest”)
Which is more competitive in a free market?
Not too long ago, I was watching this happen, anyone who could prove that they could not pay back a loan: received a loan. That was when the “boom” was booming. Call it a “loose” money policy, from the top down.
Now, and I see this happening with companies like Tesla Motors, a person (or a group of people) who can prove that they don’t need any money: can’t get a loan. That is called “tight” money policy, from the top down.
The top down method is gearing up to change back to a “loose” money policy soon. Who gets the money? How much does the money cost? Who decides who gets the money, and who decides how much the money costs?
In the case of “legal” money, the question of who gets the money is answered by the creditor as the creditor chooses who gets credited and who gets the money. If the case of the cost of the money, that is decided by the person having to pay the cost. Blood does not flow from rocks; no matter how hard you squeeze them – or crush them (I’ve done my share of rock crushing).
I’m not so close to the edge of my seat as before, yet I’ll read the rest of Gary North’s latest news item. I really like that guy.
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The thought that commercial bank insiders actively demolished trillions of dollars of their own equity as part of a conspiratorial plan is so imbecilic, so outrageous, so ludicrous, that I am convinced that these conspiracy worshippers have lost whatever remained of their minds. They have been gutted intellectually, just as the banks have been gutted financially.
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Here is where I get much of my confidence in the current situation being less than cataclysmic, not so much dooms day as it may be one doom day for one person, or two, and more than two, some people always find a way to suffer, some people are innocent victims too. The power to enforce false and misleading currency (of all forms) is becoming less powerful relative to the power to allow the free and unrestricted flow of true and productive currency. Did I just confirm, or say the same thing, in other words, as did Gary North in the quote above?
Not quite, but the reader has to answer the right questions to know the difference.
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The American conspirators have lost the one thing that they thought they had: control over the nation and the nation's finances by means of the fractional reserve banking system. That system is coming unglued, just as Ludwig von Mises said it would, just as Murray Rothbard said it would, and just as those other Austrian economists who understand the enormous weakness of the fractional reserve system had said would eventually take place.
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According to Gary North (in another article), Mises was for Free Banking and Rothbard was not for free banking. One, it seems to me, was for competition, and the other was for monopoly (removing competition). It seems to me that those two people were on the same side in their predictions, and on opposite sides in their “Austrian” theories. I can predict that the sun will stop shining, and I am right.
The thing to think about here, now, is to predict which currency or which currencies will replace the dollar as the hegemonic currency (the one that eliminates the competition effectively), or to predict a long run of competition as currencies compete for market share based upon their ability to offer higher quality at lower cost.
Will Gary North predict this type of prediction in his news item? My guess is that the age of currency monopoly is not over and the new currency hegemony will be the highest quality currency at the lowest cost long enough for it to grow corrupt and then the quality will reduce, the costs will go up, and then a new age of competition will emerge again. The time frame for this “cycle” of dominance could be in the order of 100 years.
How long has it been since the British pound was the dominant, monopolistic, world hegemonic currency?
The dollar hegemony has now a chance to reduce costs and increase quality relative to the competitors, so as to regain its power to enforce its currency monopoly, or blow up the competitors, torture them, and murder them. Here is where it is noteworthy to include the factor of “energy” into the equation because we all know (even us ignoramuses) that money without any backing is worthless money – less valuable than toilet paper.
Is the dollar backed by stupid people paying taxes to the U.S. National government, or is the dollar backed by oil, coal, electricity, natural gas, steel, uranium, wheat, corn, sugar, human labor, etc.? Think about that please as you contemplate wiping your behind with one of those greenbacks.
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What can be done about it? Politically, nothing. The American political system has been soft-core fascist for almost a century. Liberals love to call conservatives fascists. The problem is, the liberals are right. Of course, well-informed conservatives like to call liberals fascists, and they are correct, too. Everyone who believes in the efficiency of the so-called government-business alliance is a fascist.
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Note: Murray Rothbard was a fascist
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For over a century, the best and the brightest of the students graduating from the senior universities of the country have been recruited into big government and fractional reserve banking. In other words, they relied on coercion to get rich personally and to direct the growth of American capitalism. They got rich, and capitalism grew, but it grew in terms of malinvestments. It grew because the fiat money was used to lower interest rates, and these lower interest rates led to malinvested capital. Mises showed how this system operated as early as 1912.
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That is how Gary North confesses his ignorance concerning political economy. How, for example, does the lowering of interest rates lead to mal-invested capital? To explain that answer one must get Gary North to answer specific questions. That won’t happen.
Consider what would happen if Obama allowed free banking in the U.S.A. and consider what would happen if one new banking competitor offered no-interest loans of legal currency?
Think about that – please.
What would happen if the cost of getting one of those no-interest loans was a history of paying back every penny of every loan ever borrowed? What would happen?
Gary North is a scarce-economic capitalist, who bases his “theories” on scarce power economies. What happens when power is not scarce?
What would happen if the same bank that offers no-interest loans, on home mortgages for example, what would happen if that same bank were to offer 1% interest loans on power producing products like Solar Panels, Electric cars, Wind Generators, wave generators (lunar generators), etc.?
What would happen? Power would no longer be scarce, no longer held scarce, no longer crippled by people who “believe” in scarce-economic theories.
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This is why academic economists are demanding even more Federal spending to bail out the banks and the other institutions associated with high finance.
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I don’t think so. The reasons people embrace, the reasons people covet, the reasons people love to thing about, the reasons people employ, or the rationalizations people use to rationalize doing the things that people do, like invading places where oil is found, torturing, mass murdering, and such, are as varied as the number of people doing those things. What reason does Gary North embrace as Gary North embraces his scarce-economic theories? Am I able to put words in his mouth, and give him his reasons for reasoning? No.
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There is real recovery and nominal recovery – recovery in terms of rising prices. Rising wages and rising prices give the illusion of prosperity.
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I do not disagree with much of the scarce-economic theory as scarce-economic theory concerns scare things. Above makes perfect sense. When the growth of money is faster than the growth of valuable things the effect is an increase in prices on valuable things.
If that growth of money is invested in the production of power producers, then valuable things keep pace with the growth of money and the growth of power producers can exceed the growth of money, where the effect will be a lowering of prices.
If you do not see this, then consider re-reading Joe’s Law.
Power produced into a state of over-supply decreases the price of power while purchasing power increases because power reduces the cost of production.
Suppose, for example, the 800 billion dollar bail out was spent on nothing but solar panels and electric cars for the top credit score home and business owners in the U.S.A.
And, don’t forget, those top credit score home and business owners no longer have to pay mortgage interest (they only have to pay off the price of their homes and business loans – not the “interest”).
How about some number crunching? Suppose each home and business owner borrowed that bail out money and each home and business owner would (low risk) pay back the entire 800 billion dollars in 30 years time, plus 1 percent interest on the portion of the loan employed toward the purchase of power producers (solar panels and electric cars).
Suppose half of the 800 billion loans went toward mortgage interest pay off and the other half went toward power producer purchases.
400 billion goes toward Solar Panels and Electric Cars, and that money returns back to the bank in 30 years with 1 percent interest extra.
Now cut that 400 billion down to 200 billion spent on Solar Panels and 200 billion spent on Electric Cars.
How much more power is produced by the Solar Panels purchased with 200 billion dollars?
Well…I’ve read that the latest Solar Panels are now capable of producing replacement costs as soon as one year. I can link that news if requested. Suppose, in a conservative measure, that it takes 15 years to produce the pay back costs of the 200 billion dollars worth of solar panels?
In 30 years, then, those Solar Panels make 400 billion dollars worth of power, and 1 percent of that power goes back to the bank, while the remaining “profit” goes to the home and business owner who can spend, save, or invest that “profit” into his or her or other people’s economy.
Now move onto the Electric car 200 billion dollars. How much less dependent is the U.S.A. on foreign oil as a result of that investment in 200 billion dollars worth of Electric car production as the home and business owners who benefit from this stimulus package generate their own motor fuel (electricity) and as these home and business owners drive past the gas stations?
Why do you, yes you the one with the brain, think that the U.S.A. are in Iraq, and why do you think that the U.S.A. doesn’t like Hugo Chavez?
Is this irrelevant nonsense?
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The next college-level economics textbook that exposes the Federal Reserve System as the commercial bank cartel's enforcement arm will be the first one.
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I really do like Gary North.
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We were all dismissed as cranks.
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Gary North dismisses me as a crank, before he even listens to what I have to say. What is that?
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As the Internet grows in its influence, alternative views can get to a minority of educated people. The success of the Ludwig von Mises Institute in getting Austrian School economics in front of hundreds of thousands of young people, all over the world, who would never have heard about Mises or Rothbard had it not been for the World Wide Web, indicates that the foundations of the modern fascist economy are being undermined where it counts, which is in the minds of bright people who are no longer buying into the system.
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That is funny to me. I’ve been banished from the “Mises Institute” forums, for doing nothing more or less than I’ve done on this forum. The powers that run that “capitalist” enterprise couldn’t stand the competition on a public forum. The “Mises Institute” dismissed me as a crank, then banished me, yet they still publish my work.
Here is an example:
http://www.austrianforum.com/index.php?showtopic=364
Check out the charts.
Yes, I’ve been banished.
I read the rest of the news from Gary North and I hope someone else reads it too. The proof will be in the pudding, so to say, as a new form of currency replaces the old form.
The old form of currency was handed out to people who proved, beyond any doubt, that they were incapable of paying back the loan (never mind paying back interest on the loan), and this I saw personally as I helped my wife in her Real Estate business.
That is the old form of money being used to expand the money supply in that way. That is one of the ways that the old form of money was used to purposefully expand the money supply, and create an economic boom. Loaning money to people who prove that they cannot pay back the loan is one of many methods employed to make more money flow into circulation, and cause a boom in the economy, so as to increase prices on purpose.
You must, at least, read “Confessions of a Monopolist” by Howe – if you doubt what I am reporting.
Here is a link:
http://www.amazon.com/Confessions-Monopolists-Frederic-C-Howe/dp/0839807937
When the dollar hegemony wants to create a bust they take money out of the money supply and they don’t loan money even to the people who prove that they don’t need the money, and an example of that is Tesla motors, another example of that is seen from day to day in the Real Estate business – during the down cycle created by the dollar hegemony.
Gary North is reporting on the impending change back to a “boom” cycle from a “bust” cycle. If he knows when that switch will occur (from bust back to boom) then he can make a lot of “profit” from that accurate knowledge.
That is why the business cycle is created and maintained by the fascist state operators, to profit – and to profit from insider knowledge concerning when the cycle changes.
Buy at the bottom. Sell at the top. Rinse and repeat.
Read Howe.
Read Spooner.
Read Greene
Read Warren
Read Andrews
Read Mises
Don’t read Rothbard, unless you want more falsehood.
The creating of more currency can be a good thing as that currency flows to people who produce valuable things with that currency and when power producing things are produced with that currency the cost of producing everything goes down. Is that a bad thing or a good thing, and from which perspective are you viewing?
A. Profit at the expense of someone
B. Profit while everyone benefits