Quote:
Originally Posted by Skybird
Microcycles like this only help propagandists to acchieve extremely short-termed political election goals, or not. Economically, they are meaningless, if you consider this: the volume of financial transactions across borders that base on FIAT money exceeds the volume of real goods trades by a factor of at least 25 (said former Deutsche Bank CEO Herrhausen).
But FIAT money is no real value. It is a bond. It is debt being traded in good - though unfounded - faith. It represents no real values and assets and services - not even a claim for these. FIAT money does not create real values. As the saying goes: from nothing comes nothing.
News like this one now only keeps peoples' minds distracted and so prevents them from revolting. Meanwhile, the pressure-bubble keeps growing. Never has there been more FIAT money pumped into the economic cycle, as currently. Never has there been such a multi-factorial discrepancy between real values, and debts surpassing them. And we all are guilty in having helped this bubble to grow. We all are compliances in crime. But when the bubble bursts, everybody will claim to just be a victim, and that one could not have known.
BS. Economics is not difficult, and they are not a science (I do not understand what place economics have at universities). Difficult it becomes only in attempting to hide unwanted truths and deceive the wide public over the disaster unfolding. The cheating and lying - that is what adds complexity to it that now is so voluminous that it cannot be controlled and overwatched anymore.
No attack on you, Vendor, my criticism aims at the issue, not at you for posting.
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All money is fiat money, Skybird. All money has a value because society has agreed upon the fact that it does. If your money is backed by gold, or seashells or horses or whatever, it doesn't make it any more sound than any other type of money. Gold, seashells and horses have little to no intrinsic value other than the fact that we agree that they do. Scarcity is not enough to make something valuable.
I have a cup that I drank tea out of this morning. As far as I know, it's the only cup that still has my spit on it. That makes it one of a kind. Does that fact make it valuable?
Quote:
Originally Posted by GT182
Duh! Consumer spending rose because prices rose. How can you spend less or the same with higher prices all across the board?
Prices rose because the economy was bad. So now if the economy is so much better, why don't prices fall?
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Prices won't rise unless people spend enough money to drive up prices. Inflation is a sign of a healthier economy. If no one has any money to spend, or if they are fearful that they may not have money in the near future, they won't spend it and there won't be as much inflationary pressure.