Should the US return to the Gold Standard?

[FoolKiller]

Right. But billions have been made. Actually, there no monetary value on what good the US govt has done through research and development. Because you don't get it has no bearing on reality.

I hope that return on investment is going to keep my daughter from paying off the debt incurred to hand money to companies.

Government cannot add money to the economy without first taking it out. Do you support government handing your tax dollars out to companies?

 

[Dapper]

I hope that return on investment is going to keep my daughter from paying off the debt incurred to hand money to companies.

Another expert that defies you.

Again, check reality. Look at real GDP growth.

 

[FoolKiller]

More experts that defy you.

I won't say good things haven't come from the space program, but to act like innovation didn't take off until the 50s and 60s is ridiculous. The entire electronics and telecommunications industries would disagree. Hell, the telecommunications industry was stagnated for decades by government investment and involvement.

For every good investment government makes they screw it up too.


EDIT: And we are way off topic, unless you are going to argue investment made while gold was still used is an example of why gold has no value or whatever your thought about the material that makes most of those innovations possible is.

 

[Dapper]

I won't say good things haven't come from the space program, but to act like innovation didn't take off until the 50s and 60s is ridiculous.

Despite that not being the case, if it were, it wouldn't be as ridiculous as your argument that not only defies logic, but numerous experts also.

edit-The knee of the exponential curve that is the growth of technology is now. A bit of thought put into noting the time of each major human advancement reveals this to be the truth. In fact, as I eluded to earlier, this growth can be traced back to the big bang. And, indeed, every advancement fits on to the exponential curve. And, yes, the 60's were the crux. (shown below:US GDP, US debt, computing)
http://www.usgovernmentspending.com/us_gdp_history
http://www.google.com/imgres?imgurl...J6T-TIIIOI0QGHteW1Bg&ved=0CEQQ9QEwBw&dur=3457
http://www.google.com/imgres?imgurl...N6T5isDKPr0gGnnKybBg&ved=0CEgQ9QEwCA&dur=2860

If I keep repeating something it must be true.

If I keep repeating something it must be true.

If I keep repeating something it must be true.

If I keep repeating something it must be true.

If I keep repeating something it must be true.

If I keep repeating something it must be true.

If I keep repeating something it must be true.

FACT!

He articulates a good idea. 👍 (around 4min in I think.)

 

[LMSCorvetteGT2]

Do you consider the early 1970s to be medieval times, by the way? Just asking.

Oh, another article on the topic, from Forbes this time.

Exactly, I don't understand how he calls the 50s, 60s, and 70s mideval times economic wise? Thus me questioning it warrants his smart :censor: comments...

To be honest Dapper you have to be in line for this years darwin award at some point soon.

You seem unsure.
I get you don't understand the world is worth more now compared to medieval times, gold can't keep up with the growth and gold has been proven to be unnecessary in our current economy.

Actually my questioning of you is how you come up with your tom foolery not whether or not you've made a paradox. That part of what I say comes off clear that is what believe. I was mearly saying it is a bit of a paradox, not me being unsure. So instead of your Econ101, you might want to look into the fall catalouge at your nearby community college for Eng101.

Wrong right from the start.

For clarity, gold's value is set by supply/demand. So is everything that currently backs the US dollar.

No it's not. Gold always has a high value not due to supply, more so due to the technical value it holds, as home for the summer just pointed out to you. Yet it's fine you chase right after Famine's tail. However, we're the ones that are just ever so wrong, dear us.

On a side note, I'd say Silver is just as massive as Gold when you look at the technological and industrial applications. With these two things, Gold and Silver are better items to have then a simple paper dollar that is regulated by a system, that can at any given point make more because they feel it is needed or for what ever other reason. I don't understand how one can't see the value econ wise of it when you look at what it is truely used and sought for.

You seem unsure.
I get you don't understand the world is worth more now compared to medieval times, gold can't keep up with the growth and gold has been proven to be unnecessary in our current economy.

Actually my questioning of you is how you come up with your tom foolery not whether or not you've made a paradox. That part of what I say comes off clear that is what believe. I was mearly saying it is a bit of a paradox, not me being unsure. So instead of your Econ101, you might want to look into the fall catalouge at your nearby community college for Eng101.

The commercial just points out color dictating desirability is nonsense.[/QUOTE]

Yeah kind of said that, probably why you quoted me and just mirrored my words.

Wrong right from the start.

For clarity, gold's value is set by supply/demand. So is everything that currently backs the US dollar.

No it's not. Gold always has a high value not due to supply, more so due to the technical value it holds, as home for the summer just pointed out to you. Yet it's fine you chase right after Famine's tail. However, we're the ones that are just ever so wrong, dear us.

 

[Luminis]

Exactly, I don't understand how he calls the 50s, 60s, and 70s mideval times economic wise? Thus me questioning it warrants his smart :censor: comments...

Well, the way I see it, there are quite a few experts advocating a gold standard of sorts at the moment, so I doubt there's a definite answer to that question, as of now. It also worked in the times following World War II, when there was ecomonic growth, so saying that a gold standard downright kills economic growth under all circumstances seems plain wrong, as well.

And if the whole issue is just about there not being enough gold, you could use gold, silver, platinum, palladium and even rhodium. And while the exchange rates between those would like fluctuate, you'd at least end up with a currency backed by something of actual worth.

Yes it will. Those people are complaining about a devaluation of wealth, not really about ease of transactions. You can keep the vast majority of your wealth in gold and still keep some walking around money as currency. It's not a huge deal to sell off some of your gold so that you can spend it in dollars. And doing so doesn't really increase your inflationary exposure.

Doesn't that imply that making gold and silver legal tender will have virtually no impact on anything? Well, then there's not reason to oppose that, is there? Aside from keeping it less comfortable for people to back their wealth by an uninflatable value, obviously.

 

[Danoff]

It seems to me that Danoff and Dapper have both touched upon the problem with having an economy based upon some physical asset, like gold. There is a relatively "fixed" quantity of this physical asset, and therefore there would be an arbitrary limit on how fast an economy could grow if the money supply was directly based upon its value.

Not quite. It doesn't directly limit how fast the economy can grow, the fixed quantity causes deflation when the economy grows anyway. Deflation can lead to stagnation because it discourages investment, but that's a 2nd order effect.

It also highlights the disparities between nations and their reserves of gold and their potential ability to acquire additional quantities of gold.

According to the World Gold Council, the US has gold reserves of 8,133 tons. At a market value of $1,700 per ounce (or $59,840 per kilo), this would equate to a value of $442.4 billion. Does this mean that the US economy should shrink from its current level of $15 trillion down to $442.4 billion? Or should we inflate the value of gold to match the $15t economy?

We can't "inflate" gold like we can "inflate" dollars. But gold would be worth more if it were tied to the US economy via currency. Adopting a gold standard for the US economy would essentially create massive demand for the existing supply of gold, which would skyrocket the price. Contracting the economy isn't really possible.

Once this gold standard was in place, I'm not sure how the US economy would expand from year-to-year (a concern mentioned by Dapper). The US currently only mines approx. 242,000 kilos of gold each year (which has a current market value of $14.4 billion dollars). This would put a severe limit on US growth (approximately 0.1% per year).

Definitely doesn't work that way. Gold would increase in value with the growth of the economy even if no new gold were mined. That causes deflation which leads to other problems. But the amount of gold discovered does not directly limit the economy.

Wouldn't going back onto the gold standard reward any country that could produce gold, and dis-advantage any country that didn't have gold as a natural resource? In order, the top seven gold producing countries are (I think this data is from 2008):

China (361k kilos)
South Africa (272k kilos)
Australia (247k kilos)
United States (242k kilos)
Peru (203k kilos)
Russia (159k kilos)
Canada (104k kilos)

In fact, all of those nations would also benefit directly from US economic growth (and we would be tied to the growth of other gold-backed economies). Yes, gold discovery benefits the nation right this very second regardless of whether we back our currency with gold.

What happens if some other country (say Iran or Canada) finds and develops a new gold mine in their country that can suddenly produce 10,000 tons of gold a year? (equivalent to $544 billion dollars)(current world production is approx. 2,700 tons a year) Wouldn't this country be able to purchase every US asset within 20-30 years? Or would this excess supply of gold devalue the rest of the world's gold and every nation's economy would contract 10% a year for every year for the forseeable future?

It would cause an inflationary pressure on our currency. It's not likely to happen, but it could.

Doesn't that imply that making gold and silver legal tender will have virtually no impact on anything? Well, then there's not reason to oppose that, is there? Aside from keeping it less comfortable for people to back their wealth by an uninflatable value, obviously.

See above for impacts. Deflation is bad for economies. I'm saying there's not much advantage (since you can convert your dollars to gold right this second to avoid inflation), and there is significant disadvantage (deflation). The only real barrier is capital gains tax, which hinders your ability to get around the problems with our fiat currency. Rather than push for a gold standard, we should just eliminate capital gains tax (this should also shut up anyone complaining about tax loopholes for the rich).

 

[Dapper]

LMScorvette told me to look into English classes?!

Since it is clear, to most, that gold is not viable as a currency because of the real growth happening right now, it may be a good time to bring that fact back into the scope of the 2012 presidential race.

I want a leader aware of what is going on. Advocating gold, or any regressive political policies, indicates one is not able to grasp the macro changes in every aspect of the world, and that is totally understandable because of the massive changes going on, but I don't want that guy as my leader.

Obama has set solar energy goals so that they almost directly reflect the exponential growth of today's technology. No GOP candidate has this scope. I'm not the biggest obama supporter, but the guy is forward thinking, looks at objective data, listens to experts and draws goals from that information. That is opposed to ideology guiding one's goals.

 

[Danoff]

LMScorvette told me to look into English classes?!

Since it is clear, to most, that gold is not viable as a currency because of the real growth happening right now, it may be a good time to bring that fact back into the scope of the 2012 presidential race.

I want a leader aware of what is going on. Advocating gold, or any regressive political policies, indicates one is not able to grasp the macro changes in every aspect of the world, and that is totally understandable because of the massive changes going on, but I don't want that guy as my leader.

Well, I'd rather have the guy who wants to prevent the government from inflating the currency (Ron Paul) than the guy who wants to inflate the currency (Obama). Don't throw the baby out with the bathwater. There are issues with going to a gold standard, but the sentiment is high right now because the government is being irresponsible on Obama's watch.

Obama has set solar energy goals so that they almost directly reflect the exponential growth of today's technology. No GOP candidate has this scope. I'm not the biggest obama supporter, but the guy is forward thinking, looks at objective data, listens to experts and draws goals from that information. That is opposed to ideology guiding one's goals.

Except this is the direction we should be going:


We can worry about solar energy afterward when we have gobs of cheap electricity to help produce solar panels. The president shouldn't be setting these goals either, he should be removing road blocks that prevent nuclear power from taking off here.

 

[Dapper]

Danoff, do you think if the US comPletely ignores solar energy forever that it's growth will even be slowed? It won't. It is unstoppable.

Either the president understands that no war, depression, natural disaster, etc, has never slowed technological growth, or they take your stance and think it will wait for us. "wait for solar afterwards" means other countries get to do to solar like the US did with computers! We invested in that stuff. Did you ever notice that US websites are '.com' and every other country has has to put '.their country'? UK's stamps don't say UKPS on them like the US stamps that say USPS, the UK was just first, the idea didn't wait.

So either we have a president that keeps us ahead of the curve, or we can worry about inflation without any real reason and we can turn into China's manufacturer.

It is worth mentioning the Fed and almost all economics is linear based. That is why inflation worries many, but as evidence points out it's a fruitless worry.

Another thought on inflation: Technology is deflationary.

 

[Danoff]

Am I having a conversation with Dapper?

Danoff, do you think if the US comPletely ignores solar energy forever that it's growth will even be slowed? It won't. It is unstoppable.

It is a mistake to think that the US economy is unstoppable. It most certainly is stoppable. Europe seems to have the blueprint on stopping economies, and we seem to be adopting that as quickly as possible.

Either the president understands that no war, depression, natural disaster, etc, has never slowed technological growth

That's not correct by a long shot. If you want to see how to stop technological growth, just look up automotive technology in Soviet Russia. You'll see exactly how to eliminate technological growth.

, or they take your stance and think it will wait for us. "wait for solar afterwards" means other countries get to do to solar like the US did with computers!

Watch the video.

So either we have a president that keeps us ahead of the curve, or we can worry about inflation without any real reason and we can turn into China's manufacturer.

Oh there are very real reasons to worry about inflation. This country experimented with it to disastrous results not so long ago. The president's job is not to keep us ahead of the curve, we'll do that on our own. Our government's job is to provide a just framework upon which we can work. Government cannot guess which directions we need to go, and when they try they're almost always wrong. We need to grow in those directions organically. In the meantime we need to break down government barriers preventing us from exploiting technologies that can be very beneficial (nuclear power).

 

[Dapper]

Shoot, I'll respond fully later. But your soviet example plays right into my ideas. Automotive growth has never slowed. (But here is the real kicker- Human Transportation has been exponentially growing since human, and it will never fall off that curve.) Technology has never slowed, it never will, and technologies deflationary properties will continue to offset raising cost of goods such as milk that go up in price due to quality and many other variables.

And the US economy can be slowed and even shut down in a hurry! Technology growth can't.

 

[Danoff]

Shoot, I'll respond fully later. But your soviet example plays right into my ideas. Automotive growth has never slowed. (But here is the real kicker- Human Transportation has been exponentially growing since human, and it will never fall off that curve.) Technology has never slowed, it never will, and technologies deflationary properties will continue to offset raising cost of goods such as milk that go up in price due to quality and many other variables.

And the US economy can be slowed and even shut down in a hurry! Technology growth can't.

This is naive.

Technology growth only happens when it's allowed. Africa is a poster child for lack of technological growth. The native Americans are another fantastic example of a culture the sat idle for thousands of years. The fall of rome also took with it centuries of knowledge.

There are current, recent, and distant past examples of humanity stagnating or even stepping backward technologically.


Sorry TM, didn't see your post there. We can take this elsewhere.

 

[Dapper]

Naive? Humans use to walk on all fours. Now we are travelling outside of our planet, contemplating intergalactic travel and just starting to harness the energy of the sun (at an exponential rate.)
We use to not be able to speak. Now we can all but communicate telepathically.

I see no way humans, or life in general, has regressed in any major way.

Indians used smoke signals. That is innovation. And arrow heads, fire, etc...

 

[Danoff]

Indians used smoke signals. That is innovation. And arrow heads, fire, etc...

...for thousands of years. That's not innovation on the scale you're talking about.

Don't get me wrong, I don't think that we could exist on this planet for the next 10,000 years without making any progress at all. But it doesn't have to be as fast as it has been in the last 200 years. We can slow to a crawl, in fact, many places on Earth today are crawling along with almost no innovation.

This statement:

Either the president understands that no war, depression, natural disaster, etc, has never slowed technological growth

...is misleading at best. It's not as if nothing that our nation does can slow technological growth, many things we are currently doing slow technological growth, and many other nations do far worse things that slow or eliminate technological growth.

So, back to your point:

Either the president understands that no war, depression, natural disaster, etc, has never slowed technological growth, or they take your stance and think it will wait for us. "wait for solar afterwards" means other countries get to do to solar like the US did with computers! We invested in that stuff.

Do you remember the huge government push to develop computer technology in the early 80s. I sure don't. The digital age is not a product of government planning and foresight. It grew organically in an environment that fostered growth. Computer technology exploded precisely because the government stayed away, and now when the government wants to get involved people point out how much that will slow development and stagnate future progress. Nuclear energy has slowed to a crawl because of the barricades that our government has put in place - we need to lift those barricades, that's what our government is supposed to be doing.

Now back to why we got on that point:

I want a leader aware of what is going on. Advocating gold, or any regressive political policies, indicates one is not able to grasp the macro changes in every aspect of the world, and that is totally understandable because of the massive changes going on, but I don't want that guy as my leader.

Advocating a gold standard, even though I don't agree with it, is a response to a very real problem fostered by the Bush and Obama administrations - inflation. I'm far more in favor of a candidate that at least sees the problem than the candidate that does not.

 

[Azuremen]

Naive? Humans use to walk on all fours. Now we are travelling outside of our planet, contemplating intergalactic travel and just starting to harness the energy of the sun (at an exponential rate.)
We use to not be able to speak. Now we can all but communicate telepathically.

I see no way humans, or life in general, has regressed in any major way.

Indians used smoke signals. That is innovation. And arrow heads, fire, etc...

Look at Europe during the Roman Empire. Then look at Europe during the Holy Roman Empire. Or Europe compared to the Islamic empire, or the stagnation of development in Japan and the East following their increasing isolationist policies during the European Colonial phase.

Honestly, it is as if you've never studied history.

 

[Dapper]

As anything growing exponentially, each new invention or step is going to be closer than the one previous.

Lets look at real world examples instead of sweeping generalizations. We can look at any specific development such as communication, travel, farming, etc. But communication is a very tangible example. Comparing two civilizations that were well before the knee of the curve, albeit far apart on a LINEAR scale, is expected to yield very little difference.

Speaking lasted for several thousands of years, an eon. Then came things like smoke signals (now we could communicate long distances). So, we do that for a couple thousand years. Next was Morse code, that was sufficient for ~100years. The phone came next, it's life was short lived. We are currently able to use 3-D holograms to display a life-like image anywhere around the world.

 

[Danoff]

There he is. Classic Dapper is back!

You realize that this is a diversion AND that you're buried in wrong at this point right?

 

[Dapper]

Lets look at real world examples instead of sweeping generalizations. We can look at any specific development such as communication, travel, farming, etc.

I almost started watching this by random. I bet no one sees the relevance.
Communication

Farming

 

[Azuremen]

You complained about generalizations, then post a lecture working with generalizations? Most all of the major developments in technology developed because of capitalism, not because the government forced it.

But this is a tangent from the primary point anyhow, as technology doesn't counteract inflation at all.

 

[Dapper]

You complained about generalizations

No.

Look at Europe during the Roman Empire. Then look at Europe during the Holy Roman Empire. Or Europe compared to the Islamic empire, or the stagnation of development in Japan and the East following their increasing isolationist policies during the European Colonial phase.

X axis is time, Y axis is innovations
Can you look at an image like that knowing today's innovations, the innovations of the societies you listed and their dates, and then honestly think it is logical at all to compare them? Really?

then post a lecture working with generalizations?

General because they are specific?
Nonetheless, human communication and farming have been growing exponentially for thousands of years.

Most all of the major developments in technology developed because of capitalism, not because the government forced it.

Technology will grow either way, it always has, before capitalism or even governments. Species advancement happened before humans. It's called evolution.
Solar energy, rather the ability of our species to harness the energy of the sun, for instance, is growing exponentially, output per dollar doubles every 2 years. This growth doesn't need to happen in the US. But if it doesn't, it will happen somewhere else. No single capitalist can afford to fund solar energy until it becomes profitable. But the Chinese govt. can easily fund such a venture.

But this is a tangent from the primary point anyhow, as technology doesn't counteract inflation at all.

Prove it. Prove how the cost of cars have remained about the same but cars are more efficient, faster, safer etc and there are a lot more choices. Do you get how that transcends every other industry?

You couldn't be more wrong on every level of this conversation.

Azuremen's brain is linear

 

[Azuremen]

No.

You honestly forgot something you posted that recently?

Lets look at real world examples instead of sweeping generalizations. We can look at any specific development such as communication, travel, farming, etc. But communication is a very tangible example. Comparing two civilizations that were well before the knee of the curve, albeit far apart on a LINEAR scale, is expected to yield very little difference. world.

/Slow clap

X axis is time, Y axis is innovations
Can you look at an image like that knowing today's innovations, the innovations of the societies you listed and their dates, and then honestly think it is logical at all to compare them? Really?

Congrats on being so lazy as to not even complete a Google image search.

I understand Moore's law, which is what you are mostly referring to. It applies to certain fields, not all fields.

General because they are specific?
Nonetheless, human communication and farming have been growing exponentially for thousands of years.

If you feel those were specific, I don't think there is much reason to have a conversation with ou.

Technology will grow either way, it always has, before capitalism or even governments. Species advancement happened before humans. It's called evolution.
Solar energy, rather the ability of our species to harness the energy of the sun, for instance, is growing exponentially, output per dollar doubles every 2 years. This growth doesn't need to happen in the US. But if it doesn't, it will happen somewhere else. No single capitalist can afford to fund solar energy until it becomes profitable. But the Chinese govt. can easily fund such a venture.

The Chinese government has attempted to fund industrial and other ventures in the past and it has never yielded similar results as capitalist ventures because of a lack of ambition or motivation for projects to succeed.

Prove it. Prove how the cost of cars have remained about the same but cars are more efficient, faster, safer etc and there are a lot more choices. Do you get how that transcends every other industry?

That isn't counter acting inflation. Do you understand what inflation is? It has to due with the purchasing power of currency is most contexts. And your example is this case is a very valid argument for supply and demand, and capitalism.

You couldn't be more wrong on every level of this conversation.

Irony?

Azuremen's brain is linear

Cool personal attack.

Again, I am aware of Moore's law and similar. I have studied engineering and computer science for sometime now. I am beginning to question your education. Somewhat related to that, here is a study on how people overestimate their knowledge and skill the less skilled and knowledgeable they are. For some reason, it strikes me as relevant.

 

[Dapper]

Moore's law... How linear.
From almost 3 years ago

I guess go study more? I mean, I gave no attack. Your clearly think in a linear fashion. However, you think because I can understand and digest an expert in a specific area while you cannot means I over estimate my intellect.

Inflation is less purchasing power. Yet there are people who don't understand when a car has more features for the same price, features that arise from the evolution of technogy, the currency just bought more.
And these same folks have no clue how that affects every other industry. So goes complacency.

From yesterday
A technology jump

 

[arora]

And these same folks have no clue how that affects every other industry.

Good thing you explained that to those folks above then with your transcendent
theory.

 

[Dapper]

Good thing you explained that to those folks above then with your transcenent
theory.

Oh. Seat belts and airbag cause less medical bills, for instance (more power means getting to work faster which means more gets done too, and better efficiency means more $ to spend other places as well as better for the environment ). Need I say more, or do I need to connect the medical dots to the economic dots?

And, YES, market forces thus capitalism will drive innovations, but the chemical reactions needed to get the airbag to your face before your face gets to the wheel is not determined by a capitalist. Every car getting airbags after the elite car gets one is more of the capitalism effect.

Wow, the second technological break through... In one day.

 

[Luminis]

Inflation is less purchasing power. Yet there are people who don't understand when a car has more features for the same price, features that arise from the evolution of technogy, the currency just bought more.

Oh, this is an interesting point. Because that's what the government uses to make us believe that prices aren't rising over here, contrary to popular believe. Just an aside, obviously, but this is a topic that I've been debating with various people over the last few weeks.

So, you (and coincidentally, the German government) claim that inflation is counteracted by cars (and for that matter, most electronic devices, such as cumputers and TVs) are now far better than, say, five years ago. So our currency buys more. In the same vein, it's claimed that the prices for such things are always getting lower, because the same piece is used for comparison. It's only natural that an E46 3er will be worth far less now than it was before the E90 3er launched, though. But, and that's what's irking me: As soon as you stray away from the technology sector, that can hardly be applied.

Prices for various things, such as groceries, rents or similar things have gone up, or rather, the purchasing power compared to those things have gone down, however you want to put it. My point is, it's a bit far-fetched to act as if technology was the only factor to measure inflation by. Because, let's be honest, what are you spending the majority of your money on: Groceries, clothing and a place to live, or a new computer every three years?

 

[Dapper]

Groceries' prices go up. So does the quality and variety over time. I bet hardly anyone could go to the grocery store and buy the number of exotic fruits I can today pre-1980. Anyone notice that bananas look like they get picked off a tree locally and not from South America? That is a direct result of cheaper transportation, faster transportation, better logistics because of computers, etc. The outreaching of technologies hands go into evey industry. I think that point is overtly obvious, and to be honest, I have trouble empathizing with others inability to see the connections of technology's deflationary properties.

And I haven't watched any lectures by world renowned Harvard law professors on Germany's average families spending behavior, more precisely the difference between now and a 'generation' ago, but I have for the US. Shockingly, groceries are a smaller percentage than in 1970. Repeat- The average American family spends less groceries today than a generation ago. Fact. You know what cost more? Housing. Insurance. A second car to drive 2nd worker to 2nd income (last generation were 1 income homes). Child care.

Today's family of 4 spending vs a Generation ago
32% less on clothing
18% less on food
52% less on appliances
24% less per car
76% increase in housing
74% increase in insurance

Real incomes in the pertinent time period-
http://www.advisorperspectives.com/...d-income.html?household-incomes-mean-real.gif

 

[Danoff]

Today's family of 4 spending vs a Generation ago
32% less on clothing
18% less on food
52% less on appliances
24% less per car
76% increase in housing
74% increase in insurance

Real incomes in the pertinent time period-
http://www.advisorperspectives.com/...d-income.html?household-incomes-mean-real.gif

INFLATION ADJUSTED!!!

Getting back to the point for a moment (not that you'll respond to any of this). The US government experimented with inflation in a big way in the 70s and it lead to a stagnated economy. Inflation causes stagnation because it over-promotes investment (malinvestment). When you know today's money is not going to be worth much in the future, you borrow as much as you can and spend it immediately on things that won't go down in value. Then you can pay back with money that's not worth as much. That kind of over-incentive to invest causes inefficiencies in the economy and eliminates savings. It disproportionately hammers the poor as they have the majority of their wealth in dollars, and acts as a tax on existing companies - which will have the effect of putting them out of business (disproportionately hurting the poor). It also generally has the effect of redistributing wealth from retirees to people who are not retired, counteracting social security which goes the opposite direction.

Inflation is very bad for economies. It stagnates growth, creates malinvestment, and discourages savings which creates a brittleness to the economy. It's every bit as bad as deflation (and that should come as no shock to anyone).

 

[Dapper]

INFLATION ADJUSTED!!!

The US government experimented with inflation in a big way in the 70s and it lead to a stagnated economy.

I think the only measure of inflation is looking at quality of life (the purchasing power) and the effort (the currency) to live that way. Humans live better and work less constantly. We live healthier, longer and have more amenities during our lives compared to our parents.

Explain how a person works more and gets less compared to other human ways of life. Again, this is not comparing year to year, but rather major invention to major invention (bike to car or phones to internet kind of scope), then consider the shrinking gap between it and the next invention.

 

[ROAD_DOGG33J]

Inflation is less purchasing power. Yet there are people who don't understand when a car has more features for the same price, features that arise from the evolution of technogy, the currency just bought more.

That just means the drop in cost outpaced inflation.

Anyone notice that bananas look like they get picked off a tree locally and not from South America?

Nope, I haven't noticed that at all. They seem like the same old bananas. Rarely non-organic fruits and vegetables taste like they were freshly-picked.

Regular cheap hot dog buns used to be a little more than $1 a few years ago. Now they are close to $3. Has the quality improved? I doubt it.