Beware The Invisible Hand!
Yes...beware! You can't stop it. No one can. Many have tried to but always they have failed. What the hell am I talking about? Well, Adam Smith wrote about this hand that no one can see. This hand determines the cost of all transactions. The hand knows how much of virtually everything is available for sale, how many people are looking to buy everything and how much cash is floating around in the economy to accomplish these transactions. The price of all things can be distorted for a short while but the invisible hand always eventually corrects fraudulently priced goods and services, like it or lump it.
What I am getting at, is the bankers have implemented a money scheme that allows these lucky fellows to squirt oodles of extra money into the economy for their benefit along with their accomplices - the U.S. government disparate for revenue to run an empire. However, while these banker fat cats and lucky bureaucrats are raking in a fortune printing up funny money, the invisible hand quickly knows that too much cash has been crammed into the economy and soon increases the price of one thing after another.
Here is how the invisible hand does this miracle. Everything that surrounds you now in your home or office or the streets that you drive down in your car is made from raw materials. Economists call these raw materials "commodities." Commodities are bought and sold in the "commodity pits" where huge quantities trade hands. But the price is determined the same way as in an auction. One buyer bids over the other buyer until the highest bidder determines the final selling price. Gold, pork bellies, timber, etc. are all traded in this fashion. So if the bankers flood the economy with dollars these dollars will be used in competition with one another in the commodity pit auctions to drive up raw material prices. Think about it. If you and everybody else in an auction had more cash on your persons would not the group tend to pay more for the items for sale? It's supply and demand. The same amount of stuff for sale in a marketplace flooded with dollars will drive up the price of that stuff.
So the manufacturers and wholesalers convert and sell these products made from the higher priced commodities to the retailers - who of course raise the retail price to make a profit. Then you walk into the store or drive into the gas station and become shocked at the price increase! Finally you mistakenly believe inflation is high prices. It is a sign of inflation. Inflation is those bankers printing up too much money because they can - legally. But the middle class find themselves on a fixed income that lags behind the inflated prices for the things they buy. Gas has not increased in value. It just takes more dollars to buy the same amount of gas because the dollar is worth less. If we keep electing leaders who allow the bankers to keep this up then the invisible hand will soon make the dollar for all intents and purposes - worthless. This is the sneakiest tax of them all that hurts the middle class but crushes the hopes of the poor. It was designed and implemented by the robber barons in the early 20th Century including J.P. Morgan himself.
What I am getting at, is the bankers have implemented a money scheme that allows these lucky fellows to squirt oodles of extra money into the economy for their benefit along with their accomplices - the U.S. government disparate for revenue to run an empire. However, while these banker fat cats and lucky bureaucrats are raking in a fortune printing up funny money, the invisible hand quickly knows that too much cash has been crammed into the economy and soon increases the price of one thing after another.
Here is how the invisible hand does this miracle. Everything that surrounds you now in your home or office or the streets that you drive down in your car is made from raw materials. Economists call these raw materials "commodities." Commodities are bought and sold in the "commodity pits" where huge quantities trade hands. But the price is determined the same way as in an auction. One buyer bids over the other buyer until the highest bidder determines the final selling price. Gold, pork bellies, timber, etc. are all traded in this fashion. So if the bankers flood the economy with dollars these dollars will be used in competition with one another in the commodity pit auctions to drive up raw material prices. Think about it. If you and everybody else in an auction had more cash on your persons would not the group tend to pay more for the items for sale? It's supply and demand. The same amount of stuff for sale in a marketplace flooded with dollars will drive up the price of that stuff.
So the manufacturers and wholesalers convert and sell these products made from the higher priced commodities to the retailers - who of course raise the retail price to make a profit. Then you walk into the store or drive into the gas station and become shocked at the price increase! Finally you mistakenly believe inflation is high prices. It is a sign of inflation. Inflation is those bankers printing up too much money because they can - legally. But the middle class find themselves on a fixed income that lags behind the inflated prices for the things they buy. Gas has not increased in value. It just takes more dollars to buy the same amount of gas because the dollar is worth less. If we keep electing leaders who allow the bankers to keep this up then the invisible hand will soon make the dollar for all intents and purposes - worthless. This is the sneakiest tax of them all that hurts the middle class but crushes the hopes of the poor. It was designed and implemented by the robber barons in the early 20th Century including J.P. Morgan himself.
posted by Tomás Estrada-Palma at
11:41 AM
6 Comments:
J.P. Morgan is laughing his ass off in his grave right now...
Tomas:
You left me speechless
We must go through yet another economic correction brought about by this money policy. I want you to know because the government could do a couple things. One, the could completely monetize or print enough crazy money to pay but this will cause hyper-inflationary price increases. Or the could just let the economy continue deflating and destroying weaker business and individual entities until the value of the dollar re-stabilizes.
But only keep enough cash in the bank for normal bill payments. Buy precious metals to save until the economy turns back upwards. Don't buy real estate until it hits bottom in a few years. Be conservative and stay close to home. Survive! Then prosper in a future free of these greedy bankers and their underhanded money scheme. This time around we can explain why everyone is getting poorer. We have the Internet!
You have some very interesting ideas about how the economy works. Entertaining, bizarre and erroneus, but very entertaining.
The US has the most sophisticated and effective fiscal policy. It has effectively maintained our economic status in the world by keeping our economy from growing too quickly or shrinking too quickly. It is a necessary part of a free (Capitalistic) system. Obviously in a Socialist ecnonomy there is no need for fiscal policy as there is not opportunity (speculation) and therefore everyone is equally impoverished and the economy maintains its flatline quite nicely without any need for a Central Bank or monetary policy.
Jesse you say my ideas are bizarre and erroneous yet without stating how except trying to connect my free market banking ideas with socialism somehow. As I stated it is not impossible to run a fiat monetary system but I also stated that the top guys would always be tempted to print too much money - which would of course be impossible to do under a hard money system. The fiat money system is the back bone of all socialist governments including the U.S. It makes you believe you are getting things free but in reality your wealth is constantly being drain by the less valuable constantly inflated dollars. If that were not so milk would still be a nickel a gallon and gold would be about twenty dollars an ounce. Jesse are you involved in banking? Are you a government worker? Otherwise I can't figure out for the life of me why you would advocate making the dollars constantly less valuable. So Jesse if I understand your thinking you are in favor of inflation ?
Also Jesse you mistakenly say the U.S. government keeps the economy from growing or shrinking too fast. What you mean is they try to keep the money supply from growing or shrinking too fast. As for the size of the economy itself all the government can do is reduce the size of the actual economy using taxation and regulations that retards economic activity. It could grow larger but the government would have to just leave it alone.
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