Were the Keynesians wrong?

[twiifm]

Yeah, making a hypothetical statement doesn't mean it's correct, we've heard this argument a thousand times, you're also forgetting the fact that inflation is simply going to force people to work for longer and for less pay because everything becomes so expensive. Also, if deflationary currencies are so horrible and bad, why were they used for so long? Why is it that inflationary currencies have only recently come into existence and been used widely?

Hmmm doesn't seem to me like you're really going to bother answering the question but what the hell I'll ask anyway.

Please give example of when deflationary money has been used for a long time.  And gold is not an example.  Gold was used for coinage but the money is not denominated in gold but instead whatever the Kings money was

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[username18333]

Yeah, making a hypothetical statement doesn't mean it's correct, we've heard this argument a thousand times, you're also forgetting the fact that inflation is simply going to force people to work for longer and for less pay because everything becomes so expensive. Also, if deflationary currencies are so horrible and bad, why were they used for so long? Why is it that inflationary currencies have only recently come into existence and been used widely?

Hmmm doesn't seem to me like you're really going to bother answering the question but what the hell I'll ask anyway.

1. It is state, money, possession, and tribe which begets that.

2‒3. Deflation is the reduction of “supply.” A precious stone or metal has a “supply” that nets increase (at an ever decreasing rate).

4. Here, a user profile informs visitors of its user’s “[l]ast [a]ctive” time.

[bmarch]

Keynes is the troll of economic theorists used by universities and interested parties to add theoretical justification for their parasitism.

Keynes was probably terrible at saving money. Marx was for a fact. I think Keynes appeals to people who are suseptible for lazy quick fixes in general. We live in a different world now as well and so I think something as simple as "save money for future consumption and investment" is a principle we all need to adhere to a lot more now. Society might grind along at a slower pace, but it will probably have to since things are growing in complexity globally.

Managing a global economy is a much larger pipe dream than managing farmers in Siberia was during the Soviet regime. So much more impossible. Governments and citizens alike will have to become more coherent going forward if anything is going to get done.

[username18333]

Keynes is the troll of economic theorists used by universities and interested parties to add theoretical justification for their parasitism.

Keynes was probably terrible at saving money. Marx was for a fact. I think Keynes appeals to people who are suseptible for lazy quick fixes in general. We live in a different world now as well and so I think something as simple as "save money for future consumption and investment" is a principle we all need to adhere to a lot more now. Society might grind along at a slower pace, but it will probably have to since things are growing in complexity globally.

Managing a global economy is a much larger pipe dream than managing farmers in Siberia was during the Soviet regime. So much more impossible. Governments and citizens alike will have to become more coherent going forward if anything is going to get done.

A debt is profitable for its creditor. Ought one not pursue profit?

[username18333]

Keynes is the troll of economic theorists used by universities and interested parties to add theoretical justification for their parasitism.

Keynes was probably terrible at saving money. Marx was for a fact. I think Keynes appeals to people who are suseptible for lazy quick fixes in general. We live in a different world now as well and so I think something as simple as "save money for future consumption and investment" is a principle we all need to adhere to a lot more now. Society might grind along at a slower pace, but it will probably have to since things are growing in complexity globally.

Managing a global economy is a much larger pipe dream than managing farmers in Siberia was during the Soviet regime. So much more impossible. Governments and citizens alike will have to become more coherent going forward if anything is going to get done.

The point is that Marxism and anarchism are built up on entirely different principles, in spite of the fact that both come into the arena of the struggle under the flag of socialism. The cornerstone of anarchism is the individual, whose emancipation, according to its tenets, is the principal condition for the emancipation of the masses, the collective body. According to the tenets of anarchism, the emancipation of the masses is impossible until the individual is emancipated. Accordingly, its slogan is: "Everything for the individual." The cornerstone of Marxism, however, is the masses, whose emancipation, according to its tenets, is the principal condition for the emancipation of the individual. That is to say, according to the tenets of Marxism, the emancipation of the individual is impossible until the masses are emancipated. Accordingly, its slogan is: "Everything for the masses."

Clearly, we have here two principles, one negating the other, and not merely disagreements on tactics.

(Red colorization mine.)

[twiifm]

Keynes is the troll of economic theorists used by universities and interested parties to add theoretical justification for their parasitism.

Keynes was probably terrible at saving money. Marx was for a fact. I think Keynes appeals to people who are suseptible for lazy quick fixes in general. We live in a different world now as well and so I think something as simple as "save money for future consumption and investment" is a principle we all need to adhere to a lot more now. Society might grind along at a slower pace, but it will probably have to since things are growing in complexity globally.

Managing a global economy is a much larger pipe dream than managing farmers in Siberia was during the Soviet regime. So much more impossible. Governments and citizens alike will have to become more coherent going forward if anything is going to get done.

Wrong.  Keynes is not the prevalent "school" in academia.  Its probably neo classical

Keynes did public service and was an astute investor.  His theories comes from market experience and public service experience.  IOW "real life experience" not academic theories.  He only started to get popular again recently after the 2008 crash.  His main thing is using fiscal policy and focus on unemployment numbers

The govt has no reason to "save money"  when they can just "print money".  You are totally confusing household economics and macro and blaming everything on Keynes.  Since 80's there have been no Keynesian influence on policy.  It was more Friedman

[Grand_Voyageur]

As the price was rising, all of the Keynesians kept harping about how nobody would spend bitcoins because they would want to wait to spend later when the price is higher, never spending their money.

And yet, for the past year the price has been going down, high inflation, a Keynesian dream. And yet, the spending did not skyrocket.

Why are Keynesians always wrong about economics?

Keynesianism has nothing to mean to BTC price since Keynesian doctrine relates to macroeconomics (economic policy). So far, BTC is going down since more players/parties adopted it - as per the old Exchange saying: buy on rumors, sell on confirmed news - also, i guess that the bitstamp hack add some burning fuel to the smouldering ashes.

[Elwar]

As the price was rising, all of the Keynesians kept harping about how nobody would spend bitcoins because they would want to wait to spend later when the price is higher, never spending their money.

And yet, for the past year the price has been going down, high inflation, a Keynesian dream. And yet, the spending did not skyrocket.

Why are Keynesians always wrong about economics?

Keynesianism has nothing to mean to BTC price

Tell that to the Keynes mouthpiece, Paul Krugman.

[Lethn]

Yeah, making a hypothetical statement doesn't mean it's correct, we've heard this argument a thousand times, you're also forgetting the fact that inflation is simply going to force people to work for longer and for less pay because everything becomes so expensive. Also, if deflationary currencies are so horrible and bad, why were they used for so long? Why is it that inflationary currencies have only recently come into existence and been used widely?

Hmmm doesn't seem to me like you're really going to bother answering the question but what the hell I'll ask anyway.

Please give example of when deflationary money has been used for a long time.  And gold is not an example.  Gold was used for coinage but the money is not denominated in gold but instead whatever the Kings money was

Gold is an example and the example, you're just choosing to ignore it or don't know what deflation and inflation actually is, the state always chose gold in the end, one perfect example was the byzantine empire having a gold coin minted and they lasted for almost 1000 years, even in the U.S and the UK silver was used as a currency for quite some time but was replaced by paper because it wasn't as easy to for the state to control the currency supply.

Amazes me how blatantly people choose to ignore historical fact when it doesn't fit into their political agendas, go and fucking learn what deflation and inflation actually is instead of just dismissing people who know more than you.

http://en.wikipedia.org/wiki/Byzantine_coinage

Oh and here's a definition of deflation for people willing to read since I know you won't bother looking it up.

http://www.investopedia.com/terms/d/deflation.asp

A general decline in prices, often caused by a reduction in the supply of money or credit.

I highlighted the important bit for you.

This one line is exactly what deflation is but the rest is pretty much the kind of neo-keynesian crap you're trying to peddle, precious metals are precious, very rare. So that is why everything becomes far cheaper in that currency as opposed to paper which is printed in ridiculous amounts, it is also why cryptocurrencies are worth much more than the dollar.

Inflation and deflation are almost always a result of changes in the money supply, there are of course normal trading patterns that happen because of regular trading but these always get exaggerated if it's someone messing with how much currency is in circuation. A perfect recent example would be the situation with mt.gox and butterfly labs, you also have silkroad online, those are all cases where a large amount of currency has exited circulation or been dumped onto the markets at once and that is what causes such dramatic changes in prices and also peoples spending habits, the inflation is scaring the crap out of everyone and causing everyone to dump their paper for something of value.

[twiifm]

Yeah, making a hypothetical statement doesn't mean it's correct, we've heard this argument a thousand times, you're also forgetting the fact that inflation is simply going to force people to work for longer and for less pay because everything becomes so expensive. Also, if deflationary currencies are so horrible and bad, why were they used for so long? Why is it that inflationary currencies have only recently come into existence and been used widely?

Hmmm doesn't seem to me like you're really going to bother answering the question but what the hell I'll ask anyway.

Please give example of when deflationary money has been used for a long time.  And gold is not an example.  Gold was used for coinage but the money is not denominated in gold but instead whatever the Kings money was

Gold is an example and the example, you're just choosing to ignore it or don't know what deflation and inflation actually is, the state always chose gold in the end, one perfect example was the byzantine empire having a gold coin minted and they lasted for almost 1000 years, even in the U.S and the UK silver was used as a currency for quite some time but was replaced by paper because it wasn't as easy to for the state to control the currency supply.

Amazes me how blatantly people choose to ignore historical fact when it doesn't fit into their political agendas, go and fucking learn what deflation and inflation actually is instead of just dismissing people who know more than you.

http://en.wikipedia.org/wiki/Byzantine_coinage

Oh and here's a definition of deflation for people willing to read since I know you won't bother looking it up.

http://www.investopedia.com/terms/d/deflation.asp

A general decline in prices, often caused by a reduction in the supply of money or credit.

I highlighted the important bit for you.

This one line is exactly what deflation is but the rest is pretty much the kind of neo-keynesian crap you're trying to peddle, precious metals are precious, very rare. So that is why everything becomes far cheaper in that currency as opposed to paper which is printed in ridiculous amounts, it is also why cryptocurrencies are worth much more than the dollar.

Inflation and deflation are almost always a result of changes in the money supply, there are of course normal trading patterns that happen because of regular trading but these always get exaggerated if it's someone messing with how much currency is in circuation. A perfect recent example would be the situation with mt.gox and butterfly labs, you also have silkroad online, those are all cases where a large amount of currency has exited circulation or been dumped onto the markets at once and that is what causes such dramatic changes in prices and also peoples spending habits, the inflation is scaring the crap out of everyone and causing everyone to dump their paper for something of value.

Whatever dude, before you start trying to learn me a lesson start by educating yourself first.  Read David Graeber "History of Money".  And Joseph Knapp, "State Theory of Money"

Gold the material for coins is not same as gold used as money.  To be money the king has to issue it.  We don't use paper for money either even its printed on paper.  There was not a time where you paid for bread by snipping a few links off your necklace.

Even during these times the monetary system was hybrid.  There was a credit system built on top of the metal system.  Just because money is backed by gold doesn't mean there was deflation unless you are claiming we've been in deflation for thousands of years

And following your dumb logic cryptocurrencies shouldn't be worth anything because they are made from computer code.  You can make an infinite amount of altcoins from the same code.

[twiifm]

As the price was rising, all of the Keynesians kept harping about how nobody would spend bitcoins because they would want to wait to spend later when the price is higher, never spending their money.

And yet, for the past year the price has been going down, high inflation, a Keynesian dream. And yet, the spending did not skyrocket.

Why are Keynesians always wrong about economics?

Keynesianism has nothing to mean to BTC price

Tell that to the Keynes mouthpiece, Paul Krugman.

Krugman never said anything about Keynes and Bitcoin.  He said he's not convinced it can be a stable store of value and that's not what you want as a working currency.  You want stability not volatility.  Nothing to do with Keynes just common sense

[dinofelis]

This is wrong.  You Need to read Graebers History of Money

Maybe you need to read von Mises "the theory of money and credit" ?

In modern times gold was reserve money and mainly used for international trade but inside the nation, money was largely credit money.  Credit money and metal money have always coexisted.  Gold itself wasn't the money it's the coins with stamp of the king on it.  In essence money has always been a creature of law whenever there is a state

Do you know where "dollar" comes from ?  It's a mass unit of gold.

Edit: I'm wrong, it was an amount of silver: 24 grams.

[dinofelis]

Please give example of when deflationary money has been used for a long time.  And gold is not an example.  Gold was used for coinage but the money is not denominated in gold but instead whatever the Kings money was

You should maybe read this also.

Or this .

[Petpowder]

Demand and supply balance. This world is too unstable still

[twiifm]

This is wrong.  You Need to read Graebers History of Money

Maybe you need to read von Mises "the theory of money and credit" ?

In modern times gold was reserve money and mainly used for international trade but inside the nation, money was largely credit money.  Credit money and metal money have always coexisted.  Gold itself wasn't the money it's the coins with stamp of the king on it.  In essence money has always been a creature of law whenever there is a state

Do you know where "dollar" comes from ?  It's a mass unit of gold.

Edit: I'm wrong, it was an amount of silver: 24 grams.

von Mises?  Hahaha.  Is that a joke?  Nobody in economics takes him seriously

So is sterling pound.  So what?  What does that prove?  That Silver was used for coins once?  You think you can walk into a shop in London back the old days and pay with a silver dollar?  The money aspect doesn't come from the metal it comes from the authority of the issuer

[dinofelis]

von Mises?  Hahaha.  Is that a joke?  Nobody in economics takes him seriously

It's not about his "authority", but about his arguments.
I guess that Nobel Prize Hayek is also not taken seriously then ?

So is sterling pound.  So what?  What does that prove?  That Silver was used for coins once?  You think you can walk into a shop in London back the old days and pay with a silver dollar?  The money aspect doesn't come from the metal it comes from the authority of the issuer

Of course gold and silver was used as money ! 

The "authority" you talk about was just a certification of the amount and purity of the coins.

http://www.jmbullion.com/guide/history/

From 1785 until 1861, in the relatively early years of the country, the US based their financial structure on currency that utilized gold and silver. Instead of the paper that is used today, coins made of pure gold and silver were traded in the free market. If it was not for financial crises in 1857, it is more than likely that this system would have endured for much longer than it did.

Executive Order 6102 is a case that many mistake as being the Gold Standard itself. In 1933, Franklin D. Roosevelt enacted Executive Order 6102, which stated that citizens were not to own their own stock piles of monetary gold. All gold was to be turned into the government, with the owners receiving $20.67 per ounce in compensation. The primary outcome of this event was a sharp increase in the price of gold, as it would rise to $35 per ounce shortly thereafter.

[twiifm]

von Mises?  Hahaha.  Is that a joke?  Nobody in economics takes him seriously

It's not about his "authority", but about his arguments.
I guess that Nobel Prize Hayek is also not taken seriously then ?

So is sterling pound.  So what?  What does that prove?  That Silver was used for coins once?  You think you can walk into a shop in London back the old days and pay with a silver dollar?  The money aspect doesn't come from the metal it comes from the authority of the issuer

Of course gold and silver was used as money ! 

The "authority" you talk about was just a certification of the amount and purity of the coins.

http://www.jmbullion.com/guide/history/

From 1785 until 1861, in the relatively early years of the country, the US based their financial structure on currency that utilized gold and silver. Instead of the paper that is used today, coins made of pure gold and silver were traded in the free market. If it was not for financial crises in 1857, it is more than likely that this system would have endured for much longer than it did.

Executive Order 6102 is a case that many mistake as being the Gold Standard itself. In 1933, Franklin D. Roosevelt enacted Executive Order 6102, which stated that citizens were not to own their own stock piles of monetary gold. All gold was to be turned into the government, with the owners receiving $20.67 per ounce in compensation. The primary outcome of this event was a sharp increase in the price of gold, as it would rise to $35 per ounce shortly thereafter.

Like I said money, comes from the authority of the state not the metal used to make coins.  There's only been brief periods in History like the Free Banking Period where we had wide spread use of private money.  Most of the time money has been a creature of law

[eaglgenes101]

Most inflation nowadays happens because it's easier to raise prices than it is to lower wages. These higher prices, in turn, prompt workers to demand higher wages, which in turn causes firms to increase their prices, and you get the idea. Yes, the value of money goes down by 2% each year, but as long as wages and business grow faster than that, no one gives a damn about it. And governments figure that letting this happen is easier than trying to put a lid on prices and wages.

Oh, and there actually were inflationary currencies in ancient times. Go look up what happened to Roman coins over time.

[dinofelis]

Like I said money, comes from the authority of the state not the metal used to make coins.  There's only been brief periods in History like the Free Banking Period where we had wide spread use of private money.  Most of the time money has been a creature of law

Money doesn't come from the authority of the state, but the state wants to limit the use of money on its territory to the legally allowed tender in order to be able to control and profit from it (mainly through seigniorage).

The authority of the state was "used" some times to "certify" the metallic contents of the coins (as were some *private* certifications like the Joachimsthaler).  It turns out that states often scammed people with fake certifications, while private certifications were usually more trustworthy.

The best proof of the error in your proposition is that most state fiat money has been (fakely because the states scam people) backed by metallic amounts for a long time.   If it were true that it was the state's authority that was solely sufficient to give value to state-controlled money, then non-backed fiat money would have been the norm.  After all, the state's authority wouldn't need any backing-up by any metallic or whatever commodity according to your claims.  Pieces of paper with a stamp from the state would do.

It took more than a century to get loose from metal-backed fiat money (and from the moment it did, fiat money plummeted in value like a stone).

Fiat money has been possible because of a century-long scam, where people were made to believe that they were *actually* handling a state-certified amount of metal with the fiat.  When the habit of not handling the physical value carrier which was the metal was so generalized, and people got used to pay with pieces of state-stamped paper (believing it was worth metal), only then the state scam of fiat money could be carried through.

So much for "state authority gives value".

The historical dollar was the Spanish dollar which was nothing else but a calibrated piece of silver, to be identical to the very trustworthy Joachimsthaler pieces of silver:

http://en.wikipedia.org/wiki/Spanish_dollar

The first US dollar was supposed to be a state-issued equivalent of the Spanish piece of silver.

http://en.wikipedia.org/wiki/History_of_the_United_States_dollar

The continental currency, which was an attempt at "fiat" which was not backed but "declared equivalent" to a piece of silver (which is by itself ridiculous) failed miserably.

The US money was saved for a while with the Contract Clause, allowing only gold and silver as legal tender.
http://en.wikipedia.org/wiki/Contract_Clause

No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.

I could go on...

[twiifm]

Like I said money, comes from the authority of the state not the metal used to make coins.  There's only been brief periods in History like the Free Banking Period where we had wide spread use of private money.  Most of the time money has been a creature of law

Money doesn't come from the authority of the state, but the state wants to limit the use of money on its territory to the legally allowed tender in order to be able to control and profit from it (mainly through seigniorage).

The authority of the state was "used" some times to "certify" the metallic contents of the coins (as were some *private* certifications like the Joachimsthaler).  It turns out that states often scammed people with fake certifications, while private certifications were usually more trustworthy.

The best proof of the error in your proposition is that most state fiat money has been (fakely because the states scam people) backed by metallic amounts for a long time.   If it were true that it was the state's authority that was solely sufficient to give value to state-controlled money, then non-backed fiat money would have been the norm.  After all, the state's authority wouldn't need any backing-up by any metallic or whatever commodity according to your claims.  Pieces of paper with a stamp from the state would do.

It took more than a century to get loose from metal-backed fiat money (and from the moment it did, fiat money plummeted in value like a stone).

Fiat money has been possible because of a century-long scam, where people were made to believe that they were *actually* handling a state-certified amount of metal with the fiat.  When the habit of not handling the physical value carrier which was the metal was so generalized, and people got used to pay with pieces of state-stamped paper (believing it was worth metal), only then the state scam of fiat money could be carried through.

So much for "state authority gives value".

The historical dollar was the Spanish dollar which was nothing else but a calibrated piece of silver, to be identical to the very trustworthy Joachimsthaler pieces of silver:

http://en.wikipedia.org/wiki/Spanish_dollar

The first US dollar was supposed to be a state-issued equivalent of the Spanish piece of silver.

http://en.wikipedia.org/wiki/History_of_the_United_States_dollar

The continental currency, which was an attempt at "fiat" which was not backed but "declared equivalent" to a piece of silver (which is by itself ridiculous) failed miserably.

The US money was saved for a while with the Contract Clause, allowing only gold and silver as legal tender.
http://en.wikipedia.org/wiki/Contract_Clause

No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.

I could go on...

Nothing you wrote supports the argument opposing the charts list view of money.  Furthermore, your arguments are childish and emotional so it's not worth my time to debate you.  If you think you've been scammed or whatever conspiracy theory the your mind is already lost.

Many commodities or materials have been used as money such as rice, stones, shells, etc.  The common link is that the state decreed these things to be money not the market.  Money has always been a credit system.  But only the state can make something officially the money of the land