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Author Topic: The real problem behind inflation  (Read 10024 times)
ptd
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February 03, 2011, 11:25:18 AM
 #61

Please differentiate between NECESSITIES and LUXURIES.
Not possible, you could live on a loaf of bread a day at a pinch (although you would suffer nasty malnutrition). The fact I choose to buy and use a computer would be considered a luxury by many.
I brought a smartphone even though I was pretty sure that I could buy an equivelent one in 8 mouths or so. But since the phone cost me £60 I really didn't care. I could live without it, but the benefits of having a smartphone for 8 months outweighed the cost.
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grondilu
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February 03, 2011, 11:49:54 AM
 #62

Those debates are useless.

Nobody should decide for me how I should spend or save my money.   This is only my decision to make.

People who think that a bit of inflation is good for the economy can just use paper money.

Other people will use precious metals and cryptocurrencies.

Planified economy sucks and has always failed.
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February 03, 2011, 02:28:40 PM
 #63


We've gone *way* off topic here, so if we want to continue on this subject (anarcho-capitalism et al V govt), let's start a new thread.  I'd have more to say, but this post is huge already, and I've gotta go.

Yep, all true. Still dodging the question.
Arrrghhhhhhh WHAT question?Huh?  Stop telling me I'm not answering questions that you haven't asked.

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I dont understand why you started discussing about monetary deflation when nob
Read the title of this thread.

Take a look at wikipedia's page on the amazon rainforest - it's about half of the world's total rainforest.  Do you truly think that's unimportant?  I'm shocked at such ignorance of science just for political ideals.  I don't know whether the destruction of the amazon would have a big effect on the world's environment, please don't be so arrogant as to say that you *do*.

anarchy & lawlessness: you should correct wikipedia's page if you think anarchy is not lawless. My understanding is that anarchy is nothing other than voluntary cooperation between individuals.  By definition, an anarchic society has no regulations.  Even the etymology of the word itself suggests an absence of hierarchy and authority.  This leaves the society vulnerable to whosoever would abuse that situation.  Are you so naive as to assume that nobody would seek to do such abuse?

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Tell me this: if the majority of the people really wanted to destroy the Amazon to create agricultural land, how is a democratic government going to do anything else than destroying the Amazon?
There's a clear question.  Absolutely nothing. [sarcasm]Apart from moving in the army[/sarcasm].  If everybody wanted to jump off a cliff, there's little anyone could do stop them either, right?

[quote from=caveden]
I bet all these things can be done much more cheaply than the cost of not using such precious resource as all that land.
[/quote]
ok. And I'll bet we could cover greenland with some mirrors (to better reflect sunlight), start melting all the ice, bottle it, and sell it as pristine million-year old, glacial water.  Damn, you could even sell it still frozen, or even cheaper, you could melt it and then re-freeze it - imagine: "pure glacier, the way nature intended".  Given how stupid most people are, can you doubt there would be a market for it?  And why stop with Greenland?  Now don't tell me that people wouldn't pay, they already pay up to ten thousand times the price for bottled than tap water.  And please don't embarrass yourself by suggesting that the market would punish the corporation that decided to abuse Greenland's ice sheet.  Nobody would stop them 'cos Greenland is far away from everyone except about 50000 greenlanders.  People wouldn't care about Greenland, just as you don't care that the tantalum in your mobile phone comes from environmentally destructive mines in Congo controlled by armed thugs engaging in a conflict counting millions dead.  And, you know what, maybe nothing would happen.  Maybe sea-levels wouldn't rise. But if they did, you can be damn sure the profits made would be in CEO and shareholders pockets, and nobody would cough up the money required to protect endangered coastlines.  Oh wait, what am I thinking, if the only point in preserving endangered coastlines is to preserve them, well we can just forget about it.  (That bit was pure sarcasm too, folks.  I hope you got it this time.)

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Seriously, the "world lung" hoax??
I stand corrected, but that doesn't invalidate my point.  The amazon is important, even if only because we don't yet know how important it is.

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Only by respecting private property rights you'll get people to worry about the future consequences of their acts, as the rightful owners will care about what happens to their property.
And why do you think private corporations will respect private property rights?  In a corporate world, people are rewarded with money and power. That means the people who come to power are the ones that like to have money - greedy self-obsessed people (not much different from politicians of today).  Even hugolp agrees that politicians and corporate leaders are often one and the same.  Your politicians will just become your corporate leaders, and tell me this: why should they suddenly become "nice" in an anarchist society?  I'm not saying the present political leadership is any good, or that the regulations they impose are just and correct.  I just don't think corporate anarchy will do better.

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Had you understood what I tried to explain about how governments stimulate consumption, producing short term booms at the expense of long term recessions, you'd understand who's really shortsighted...
I understand the Austrian theory of debt spending causing boom-n-bust business cycles.  I just don't think it's that simple.  The latest crisis, for example, is far more complex - not least because of the rising price of energy immediately prior to the crisis.  This limited growth for reasons *external* to the economy, which is something economic theories don't consider (as far as I can tell).  Furthermore, my understanding is that the Austrian boom-bust cycle is caused by a debt-inflated economy, thanks to fractional reserve banking, controlled (in the US) by the Federal Reserve.  Guess what?  A corporation specifically designed to safeguard the interests of privately owned member banks, largely independent of the government.  http://www.federalreserve.gov/generalinfo/faq/faqfrs.htm#5

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Useful species will be preserved,
Who gets to decide what's useful?  Just their economic function?  If you start disrupting an ecology, there is no way to tell the end result.  It's a perfect complex system, with long range correlations between species and power-law extinction events.  What if those stupid pink frogs seem useless but then, after they're all dead, it turns out they were an essential dietary part of that lovely useful crocodile's prey?  Same comment for invention of new species.  GM food companies are playing a game that could have dire consequences - and nobody really knows how it could play out.  People talk alot, but nobody really knows.

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About biodiversity, what's the point, preserving just to preserve? ... I insist that it's probably useless to preserve such a huge jungle just for the sake of preserving it. It's pointless.
Preserve it for it's potential economic utility, if nothing else.  Nobody knows what the future cost of destroying the amazon rainforest would be.

[quote from=grondilu]
In any way, what we should do about tropical forests, is not for a bunch of ecolocrats to decide.
[/quote]
[my ignorance, what's an ecolocrat? do you mean "econocrat"? if so:]  Agreed. I would have the decisions made by scientists, sociologists and philosophers - unfortunately in a pure corporate world scientists and sociologists without some funding bias would be hard to come by.

@ptd: you don't care because you have plenty of disposable income.  In a monetary deflation scenario, lots of people don't, and that chokes production.
grondilu
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February 03, 2011, 02:52:36 PM
 #64

I would have the decisions made by scientists, sociologists and philosophers

OMG  Do you realy believe this?

So you'll allow people to use public force at their will, only because those people have a piece of paper called a diploma, saying they are "philosophs" or "scientists"?
ribuck
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February 03, 2011, 03:12:16 PM
 #65

...I would have the decisions made by scientists, sociologists and philosophers...

That's a cop-out. It just gives the ultimate power to those politicians who make the decision as to which scientists, sociologists and philosophers are selected as decision-makers.

I am one of those who thinks the Amazon is important to the prosperity of humans, which is why neither the government nor its pressure-groups should be involved. Government rarely looks beyond the next election. But an owner of a forest who preserves a species that might otherwise become extinct, has tremendous opportunities to profit from that in the long-term future.
ptd
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February 03, 2011, 03:15:27 PM
 #66

@ptd: you don't care because you have plenty of disposable income.  In a monetary deflation scenario, lots of people don't, and that chokes production.

Quite the contrary, it makes my savings disposable (because all prices go down). It worth noting that monetary deflation is a result of economic growth (if you double the amount of stuff avalible, it halves in price).

I could just as well say:
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Not possible, you could live on a loaf of bread a day at a pinch (although you would suffer nasty malnutrition). The fact I choose to buy and eat meat and fruit would be considered a luxury by many.
It's no less true.
grondilu
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February 03, 2011, 03:44:07 PM
 #67

But an owner of a forest who preserves a species that might otherwise become extinct, has tremendous opportunities to profit from that in the long-term future.

+1
fergalish
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February 03, 2011, 05:13:13 PM
 #68

I would have the decisions made by scientists, sociologists and philosophers
OMG  Do you realy believe this?
Eh???  Can you think of anyone better qualified to make a scientific statement about the loss of biodiversity in the amazon that the *scientists* who have *actually studied it*Huh  Or do you think we should just take, what, like a /vote/???  Bear in mind how susceptible public opinion is to what some barbie in the latest hollywood action-crap says.

If you really believe what you're saying, then economists have no right to speak publicly about economics, and you can shove your von mises institute where the sun don't shine.  Right?  (or if you're of the other camp, then substitute for some other appropriate institute).

Some people are more educated about some topics, and, yes, that gives them the right to speak publicly, and it /should/ oblige other people to consider their opinion.

I noted the problem with finding unbiased scientists.  Is that what's bugging you?  That's not just government - it's big Pharma, big GMO, big Oil, big Internet, big IntellectualProperty, big Whatever, and all the lobbying that goes on behind closed doors (need I make it clear, by private corporations).  You can't have unbiased scientists without unbiased funding.  Corporations will never provide unbiased funding.
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February 03, 2011, 05:19:08 PM
 #69

If you really believe what you're saying, then economists have no right to speak publicly about economics, and you can shove your von mises institute where the sun don't shine.  Right?  (or if you're of the other camp, then substitute for some other appropriate institute).

Some people are more educated about some topics, and, yes, that gives them the right to speak publicly, and it /should/ oblige other people to consider their opinion.

I have nothing against freedom of speech.

As far as how nature should be ruled, it should be ruled by whoever owns it.  Free market has shown already that it is perfectly capable of maintaining and protecting natural resources, including livestocks.  And if it can't, be it.
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February 03, 2011, 06:07:54 PM
 #70

I have nothing against freedom of speech.
As far as how nature should be ruled, it should be ruled by whoever owns it.  Free market has shown already that it is perfectly capable of maintaining and protecting natural resources, including livestocks.  And if it can't, be it.

It's not an issue of freedom of speech.  It's about people who understand an issue being the decision makers, or at least having some significant influence on the decision makers.

As for the free market, what would you buy: cheap wood from company A, or expensive wood from company B which calculated future environmental-repair costs into its price?  Personally, if I could be sure that B would do that, then I would buy theirs.  But I wouldn't trust them as far as I could throw their tree trunks.  I can just imagine the board meeting - "Dear shareholders, we have $1B in the bank, but we don't want to give it to you 'cos we'll need it to help out those poor farmers in 20 years time."  "Dear CEO, we want to buy those cool new holographic phones. The door is over there, GTFO."

Free market has shown that it is perfectly capable of squashing chickens into such a small cage that they can't even turn around.  Free market has shown that it is perfectly capable of pumping livestock full of drugs and hormones to make the meat absorb more water, and so sell for more money (sold by weight); so much so that the hormones in the human food supply are causing male fertility leves to drop.  Can the forum come up with more examples of the free market's failings?  Just in case, I'd like to repeat that I don't have any great faith in government either.  I'm just skeptical that the free market would be this wonderful utopia that many people here here seem to think.
kiba
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February 03, 2011, 06:14:58 PM
 #71


As for the free market, what would you buy: cheap wood from company A, or expensive wood from company B which calculated future environmental-repair costs into its price?  Personally, if I could be sure that B would do that, then I would buy theirs.  But I wouldn't trust them as far as I could throw their tree trunks.  I can just imagine the board meeting - "Dear shareholders, we have $1B in the bank, but we don't want to give it to you 'cos we'll need it to help out those poor farmers in 20 years time."  "Dear CEO, we want to buy those cool new holographic phones. The door is over there, GTFO."

It's called suing their ass for violating your property right.

Quote
Free market has shown that it is perfectly capable of squashing chickens into such a small cage that they can't even turn around.  Free market has shown that it is perfectly capable of pumping livestock full of drugs and hormones to make the meat absorb more water, and so sell for more money (sold by weight); so much so that the hormones in the human food supply are causing male fertility leves to drop.  Can the forum come up with more examples of the free market's failings?  Just in case, I'd like to repeat that I don't have any great faith in government either.  I'm just skeptical that the free market would be this wonderful utopia that many people here here seem to think.

Chickens are food. They have no right.

If you don't like how chickens are treated, eat free range chickens.

ribuck
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February 03, 2011, 06:23:07 PM
 #72

Free market has shown that it is perfectly capable of squashing chickens into such a small cage that they can't even turn around.

Fifty years ago, a chicken cost three hours average wages. Today a farmed chicken costs fifteen minutes average wages, and an organic free range chicken costs two hours average wages.

The free market provides both choices, and provides them excellently.
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February 03, 2011, 06:32:57 PM
 #73

Free market has shown that it is perfectly capable of squashing chickens into such a small cage that they can't even turn around.

Fifty years ago, a chicken cost three hours average wages. Today a farmed chicken costs fifteen minutes average wages, and an organic free range chicken costs two hours average wages.

The free market provides both choices, and provides them excellently.

It's the only rich snotty kid like you and me that can afford healthy food in the first place(Of course, even the poor, in the US at least, now eat like kings).

If there's a way to provide healthy food for the poor, it will eventually be explored.

Otherwise, industrial farming as it is done right now will continue to be a necessity to sustain the world's population.

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February 03, 2011, 06:34:38 PM
 #74

It's not an issue of freedom of speech.  It's about people who understand an issue being the decision makers, or at least having some significant influence on the decision makers.

No problem if they just speak and hope to have influence.  I'm not fluent in english but I think it's called "advise" or "opinion", not "decision".

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Free market has shown that it is perfectly capable of squashing chickens into such a small cage that they can't even turn around.  Free market has shown that it is perfectly capable of pumping livestock full of drugs and hormones to make the meat absorb more water, and so sell for more money (sold by weight); so much so that the hormones in the human food supply are causing male fertility leves to drop.

Free market is capable of doing things right, but it's made of human being's actions.  Humans have the right to make mistakes.  Humans have the right to try things.  One thing is sure: noone has the right to use force to coerce him to do things just because he things he knows better.

PS. nobody forces you to buy a chicken if you don't like the way it has been farmed.
fergalish
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February 03, 2011, 06:52:54 PM
 #75

It's called suing their ass for violating your property right.
Are you suggesting that there should be some kind of "governing authority" where disputes can be resolved...?
grondilu
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February 03, 2011, 07:09:35 PM
 #76

It's called suing their ass for violating your property right.
Are you suggesting that there should be some kind of "governing authority" where disputes can be resolved...?

Damned it Kiba, you gave him something to bite on.  Be carefull.

For minarchist, defense of property is one of the very few things a government is usefull for.

For anarcho-capitalists, the owner of a property must defend it himself, or with a private police.
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February 03, 2011, 07:15:01 PM
 #77

Are you suggesting that there should be some kind of "governing authority" where disputes can be resolved...?

No.

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February 03, 2011, 08:03:06 PM
 #78

No problem if they just speak and hope to have influence.  I'm not fluent in english but I think it's called "advise" or "opinion", not "decision".
Correct.  Politicians often have "advisors". Unfortunately, the lobbyists are far more powerful.  Actually they're probably lobbying the damn advisors too.  Often, the advisors themselves come from a corporate or political background, and not a scientific one. 

Damned it Kiba, you gave him something to bite on.  Be carefull.
For minarchist, defense of property is one of the very few things a government is usefull for.
For anarcho-capitalists, the owner of a property must defend it himself, or with a private police.
What, like otherwise I'll discover the "dark secret" of anarchists that causes the whole house of cards to tumble down :-)  The private police doesn't solve the problem I earlier mentioned about conflicting private police forces.

Like I say, I'd have way more questions to ask, and challenges to yer messages here, and I'm really enjoying the discussion.  Thanks to all of you.  But I'm burning up way to much time on it.  I gotta stop.  Mostly, I gotta read up on the mises institute, and I ain't got time for that either.

In conclusion, my opinion is:

1. monetary deflation would be very nasty.

2. anarchism would be sweet, but possibly not practicable.

3. I genuinely find it baffling that some of you think a free market can solve long-term problems better than (independent) scientists who have studied the problem deeply.  Particularly when the problems associated with a free-market solution are far away (e.g. my Greenland Glacier Ice product, precious metals in Congo, etc).

4. Also that a free market will respect everyone's rights is bizarre.  A free market responds to the demands of large (i.e. profitable) groups.  Minorities will always find themselves subjugated.

That's it folks.  I bow out.  The last word is all yours.  Cheers.
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February 03, 2011, 08:06:22 PM
 #79

The market always serves where money is available. Even the minorities.
kiba
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February 03, 2011, 08:12:08 PM
 #80


3. I genuinely find it baffling that some of you think a free market can solve long-term problems better than (independent) scientists who have studied the problem deeply.  Particularly when the problems associated with a free-market solution are far away (e.g. my Greenland Glacier Ice product, precious metals in Congo, etc).


A good economist would have realized by now that central planners can't beat the market in resource allocation! So you see, an economic expert would excuse himself from the central planning committee or possibly derail it.

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