# End the Fed - Need opinions on this.

Submitted by Zef on Tue, 05/01/2012 - 09:07This is an email I sent to my college professor. I am waiting on his opinion of it, but I wanted to hear of anything you guys might be able to tell me.

Hello Professor

Here is what my beef is with compound interest. Please let me know what you think because this could be the foundation of my dissertation. I am pretty sure that this equation is a mathematical violation of the Uncertainty Principle in physics. This is because time is a variable, and time can be divided into infinitely smaller chunks of time. I am trying to stay away from Euler's constant because it would just complicate the explanation, and I have to come up with an explanation for that. I want to write this in such a way that someone that has taken Math 108,120,and 142, and Physics 101 would understand. This way, a college sophomore should be able to understand this.

The Uncertainty Principle states that you cannot know the location and momentum of a particle at the same time. As I have gone over with Professor Lee, a particle can be tracked in a vector space using a differential equation. Basically, it is like taking a photograph of a baseball on it's way to home plate. Yes, we know where the ball is in the photo, but the photo cannot tell you how hard the pitcher threw the ball. The photo can have a time stamp on it though so we can complete a differential equation for the ball's vector and location within a three dimensional space. My complaint about this is that the photograph is in fact a snapshot of a specific amount of time. Higher quality cameras have higher shutter rates and thus capture the time more precisely than lower quality cameras. So we can have a more precise reading on the location and time of where the ball is and when, but you can't know the speed of the ball just from the photograph, so it is impossible to calculate momentum. So I see this as an extension of the uncertainty principle in everyday life.

The heart of the matter is that when time is a variable when dealing with finite resources, such as is the case with money, then the uncertainty principle becomes expressed in a macro-economic sense. This is because time can be divided infinitely and it can stretch out infinitely.

Let's look at the equation of compound interest.

A= P(1+ (r/n))^ nt

where P = principle amount (amount of money deposited or borrowed)

r = rate of interest (as a decimal)

t = number of years the amount is borrowed or deposited for.

n = number of times interest is compounded per year.

A = Amount of money accumulated after n years, including interest.

The fundamental flaw here is that time is a variable. Since time is infinite, then this means that the amount can go up forever. The graph of this equation will show that A is a dependent variable (Range) and the rest of the variables are independent (Domain). Since the Federal Reserve loans our money out at interest and it has a monopoly on the creation of money, The range of A is the unbound interval zero to infinity (0,∞). To sum this up, we are taking some amount 'P' and adding an amount to it, and calling it 'A' and just repeating it the processes over and over. This doesn't make any sense to me.

Here is the equation of a sphere. This is just an extension of the Pythagorean theorem. People that are familiar with the equation of a circle should understand this pretty easily. It is the same concept of extending systems of linear equations in two variables, to systems of linear equations in three variables. The number of variables is equal to the number of dimensions.

(x+h)^2 + (y+k)^2 + (z+q)^2 = r^2

The reason I bring this up is because this equation produces bound intervals, and it it can be used to describe Earth because Earth is a sphere. A sphere is not infinite. This means that the perpetual increase in the money supply is not representative of a real world application. Eventually, the money supply pulls away from the range represented in the equation of a sphere. This leads to a mathematical anomaly, that left unchecked, will produce wild fluctuations in any equation derived from the original. In this case, the equation of compound interest is what the entire money supply is based on. The greater the distance from the range of the sphere, the worse the fluctuations become.

Any business model can be broken down into a set of equations designed to make money. The problem is that the fluctuations in those equations right now are producing too much uncertainty because they are derived from how money is produced right now. If you turn on CNBC and listen to executives and CEO's right now, there are a lot of complaints about uncertainty. This is why I have reason to believe that the Uncertainty Principle applies to macro economics. I think what is happening is that the Federal Reserve is fighting the laws of physics. Because they have a monopoly on the money supply, they are using an infinite resource to compete for finite resources.

For all intents and purposes, air is an infinite resource. I know it it not really infinite, but it is so abundant that it has no value. I can't just walk up someone and try to charge money for the air that he/she breathes. Think of the analogy this way. Imagine that I walked into a grocery store and said, "Hey, I will trade you the air in this room for a gallon of milk." I would get laughed at. This is basically what is happening here. The Federal Reserve is trading around something that only has abstract value because the supply is technically infinite. Sooner or later, everyone is going to figure this out, and the results could be ugly.

To further clarify this, here is the source code of computer program written in the ancient programming language of BASIC. The purpose of this program is to make a computer count integers to infinity on the display monitor.

10 N = 0

20 PRINT N

30 N = N + 1

40 GOTO 20

Here is a similar program written in the ancient programming language of Pascal. The difference here is that the computer will stop counting once it reaches a given number, and it asks the user for a number for where to stop counting. In other words, it contains a bound interval.

Program Count(Input, Output);

uses crt;

VAR NUMBER : INTEGER;

COUNTSTOP : INTEGER;

(********************************************************)

Procedure Initialize(VAR NUMBER : Integer);

Begin

NUMBER := 0; (*Sets the starting number to count up from*)

End;

(********************************************************)

Procedure Count(VAR NUMBER : Integer);

Begin

NUMBER := NUMBER + 1; (*Increases the number by one*)

End;

(********************************************************)

Procedure Getcountstop(VAR COUNTSTOP : Integer);

Begin

Clrscr;

Write('How high do you want me to count? ');

Readln(COUNTSTOP);

End;

(**********************************************************)

(***MAIN PROGRAM***)

Begin

Initialize(NUMBER);

Getcountstop(COUNTSTOP);

Repeat

Count(NUMBER);

Writeln(NUMBER);

Until NUMBER = COUNTSTOP;

End.

(***MAIN PROGRAM***)

The reason I show you this is because the equation of compound interest is nothing more than a program that counts to infinity and ultimately serves no purpose. I cannot emphasize enough how dangerous this is because it is being used for a real world application.

Here is what it looks like in the ancient programming language of BASIC. As you can see, this does nothing but add some amount forever. This is why the prices will go up forever unless we set X = 0 when new money is created.

P = Principle

X = interest earned based the independent variables.

10 P = 1

20 PRINT P

30 P = P + P*X

40 GOTO 20

I have some other supporting evidence as well. When I took exponential regression on the national debt and a graph of the equation of compound interest overlaid on top of one another, the result was amazing as these two graphs look almost exactly the same.

Also, we can use the equation derived from the exponential regression to predict how fast prices will rise. The price increases become sharper over time. Prices are increasing exponentially but it has not reached the crack-up boom phase as described by Ludwig Von Mises yet. The equation does not account for intervention by various government agencies on prices, but the general trend stays in tact over long periods of time. I suspect that all it is going to take at this point is one price shock, and the process will accelerate dramatically.

I hope this clarifies for you why I support Ron Paul. He seems to have a handle on where the problem is coming from, although I don't think he would describe it the way I have. I am not even sure if what I am saying is right, but I have had a few peers tell me that my theory is credible.

Thanks

P.S. I will talk to you after class on Monday May 7th.

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## False Logic ?

Either the logic is false, or the effort to communicate the logic, logically, did not manage well in my case.

^ <-------- What does that symbol mean in context?

How can it be misunderstood, in any way, by any thinking, rational, being, that it is criminal to enforce a privilege (such as to make money out of thin air) by one person or one small group, while the same privilege is punished if anyone else does it?

X = number of people who have the legal license to create legal purchasing power out of thin air, and therefore the number of people who legally get something for nothing as X can then legally sell that money to people who need money

Y = number of people who pay for that privilege because their only source for money is X, and they have to produce something of value to pay for the money they buy while X can merely add zeros on a hard drive at will whenever X feels the need to buy something

Z = Number of legal monies supplied to those who obey laws

(X < Y)Z = 1Z

Show me, please, how better to use math to symbolize how the fraud can't work when everyone has the same legal privilege to get something for nothing?

The fraud can only work when there are enough honest productive people obeying the law that only one person, or one small group, get something for nothing (legal license to create purchasing power at will - or destroy it at will to create a business cycle) so as to feed those criminals whose only products are lies and destruction.

The fraud destroys itself as the frauds have to pay off more and more of the victims who are employed to keep the fraud going.

The fraud ends as soon as Z is no longer 1, since competition forces the quality of money up and the cost of money down = fake competition is not competition and numbers don't lie.

People lie, and some people see dollar signs if they go along with a lie of this magnitude.

Joe

## ^ symbol mean raised to (a power)

Also, I get what you are saying here. This is helpful, thank you. I am not trying to engage in the moral ramification of the problem. I am simply trying to do what basically boils down to comparative math here. When you study numbers as long as I have, it can take you into delusional states sometimes.

Anyway, the point of all this is to have it written out very in very plain English why this doesn't work. The money that is issued has immediate debt attached to it, so it affects everything else in the entire economy. I am trying to build a mathematical model of a flawed economics system. Perhaps it would be wiser to build one based on the Austrian Theory of the Business Cycle.

## Einstien:

"Everything should be made as simple as possible, but not simpler."

I don't follow the connection with morality, is that derived from the use of the word crime?

If the goal is to cause destruction, there are ways to accomplish that goal.

Example:

Parasitic organisms designed to consume the hosts.

How is that simplified into a math equation?

If the goal is to facilitate survival of a species, there are ways to accomplish that goal.

Cause and effect. Pick one.

One is as good as another, no morality at all.

P = Power

Px > P/x

x is employment of power where Px is power employed as investment or in the goal of making more out of less power and P/x is power employed toward the goal of consuming power such as the goal by which a parasitic relationship is processed into complete consumption of the hosts.

Without Px there is no P/x.

Can that be shown mathematically, without moral judgment?

Do you know what ectropy means?

Joe

## Cause and effect

is the very nature of dependent and independent variables. The independent variable(s) will cause some answer. This answer is dependent. This is what I am getting at with Domain and Range. The value(s) of the independent variable is called the Domain. The Domain is the pretty much the mathematical word for cause. The Range is the dependent variable. Range is the mathematical word for effect. In other words the Range is a function of the Domain. Quite frankly, what you are saying here sounds a bit off the subject.

A parasitic organism consuming a host can be represented by a linear function with a restriction on the range based on time because once the host is gone, the value reaches zero. So it would look something like this

f(x) = x(1-t)

Where f(x) = weight of the host

x = consumption of parasite based on a given time period

t = number of time periods

and the restriction f(x) > 0 because the weight of the host is eventually reduced to zero (reduced to zero is a mathematical term for death).

If the parasite multiplies and reproduces, then you have an exponential function, and to describe it in this context, you would need to use a differential equation.

What you are talking about is a linear function. I am talking about an exponential functions, so I don't see how that is relevant to what I am talking about.

Math doesn't make moral value judgments. I can describe the shape of the Earth with an equation, but that doesn't make a judgement about the morals of what it's contained within that sphere.

Maybe this is not the best forum for getting feedback on this.

## Trial and error

"Quite frankly, what you are saying here sounds a bit off the subject."

I may not remember well, but I can check if needed: I admit having not quite understood the topic, or some words to that effect.

So I try to understand.

F(x) = weight of the host

That is not the same thing as power used in the process of creating more power out of less power, not just a measure of mass (or weight).

P can also be seen as Capital, or Gross Domestic Product, or the amount of productive work one person can do in one day, along the lines of the concept of electromotive force, or a potential, a capacity, a power, and then X is the factor of how much P multiplies P over time, so as to increase power, along the lines of a person planting seeds while surviving on tree bark, and P times X ends up being a row of carrots.

Px can be a Productivity equation.

Here is where I can try to bring the perspective back in view according to that often repeated concept of Keynesian Economics.

Of Px is huge then it takes longer for the increasing number of parasites to consume the host in time, as there is a proportion involved; hence my request for help in the math symbols.

Px = Productive Power multiplied by a Productivity multiplier (could be the number of people accessing honest money, division of labor, economies of scale, specialization, and mutual interest in reaching a higher rate of productivity, along with equitable trading practices.

That could be called Liberty.

What drags liberty Down? Perhaps there needs to be a division side instead of a greater than sign as such:

Px/y

y is then the parasite factor, those who have targeted any source of productivity and their goal is to steal it, consume it, and use it to steal more of it: exemplified by those people who use that Legal Money Monopoly Fraud Power.

y = crime made legal

Px/y is then illustrated in real time by The National Debt Clock.

"If the parasite multiplies and reproduces, then you have an exponential function, and to describe it in this context, you would need to use a differential equation."

Suppose we call them the Keynesian Economists, if that brings my viewpoint closer to the intent of this Topic, if that is preferable to wandering off it.

y = Keynesian Economists = employ deceit, threats of violence, and acts of violence (whatever works) to steal the power from those honest people who produce it, and then use that stolen power to steal more.

Px relates to y in the manner of a flow of power, much like, say, the Matrix movie, where the sources of power are all hooked up to a siphon of some sort and that power then flows to those who have built the siphon. The productive group may be well regulated so as to keep them barely alive, and happy to be the host, but that may not last, since there is an unwelcome consequence associated with things that pay well.

When crime is made legal what happens?

Px grows smaller.

y = Keynesian Economist grows larger.

As the power flows in that direction.

Keynesian Economists reproduce too rapidly and what happens to the host?

"What you are talking about is a linear function. I am talking about an exponential functions, so I don't see how that is relevant to what I am talking about."

Seriously, no, I am looking for the simplest way to show the facts, mathematically.

Px is obviously an exponential function, take human population for example. If everyone were Keynesian Economists the birth rate would never get past 1.

"Math doesn't make moral value judgments."

Who is bringing up the concept of morality, as far as I can see that is brought into this discussion by you, not me.

"I can describe the shape of the Earth with an equation, but that doesn't make a judgement about the morals of what it's contained within that sphere."

Again: if the design of the actions calculated to reach the goal is to consume the host (call it plan A), then math can show exactly how that plays out over time according to that plan, and if the design of the actions calculated to reach the goal is to produce more than consumed (call it plan B), then math can show that too, as it works the way it is calculated to work.

I'm not suggesting that math can judge which plan is the better plan.

Plan A consumes all the hosts = Keynesian Economy (if that is the term you want to use to label Plan A)

Plan B produces a surplus on purpose = Liberty (or if you prefer to call it Austrian Economy - which I don't)

"Maybe this is not the best forum for getting feedback on this."

I could look back at the equations you offer now knowing what is meant by the ^ symbol, but I'd probably be in need of much more help even with that understanding.

Joe

## The Universal Moral Law

This post makes sense since the Universal Moral Law is present in every discipline and therefore cannot be broken without consequences. Ron Paul has said this on many occasions and most of us who agree with him believe it to be true.

The question of course that everyone wants to have answered is how long O LORD how long?

I believe the answer to that question is to be found in "the signs of the times" that Jesus talked about when He was asked for a sign by the religious leaders:

"He said, “When evening comes you say, ‘It will be fair weather, because the sky is red,’ and in the morning, ‘It will be stormy today, because the sky is red and darkening.’ You know how to judge correctly the appearance of the sky, but you cannot evaluate the signs of the times." (Matthew 16:2-3)

In other words although these leaders had studied the external visible phenomena and understood their meaning, they had not studied the spiritual phenomena of the ways of God and how these affected their lives and historical events in the world. They therefore did not understand the significance of Jesus' teachings and miracles and the meaning of His appearing to them at that particular TIME.

The same is true today. There are many who know that the present system, let's call it Babylon, is in the process of falling. This is happening because the rulers were given a finite measure of time in which to rule. They do not know however exactly how long God has given to this "bloody city". In order to know this they would have to understand the ways in which the grace of God has been measured out to men throughout history and therefore at which point in TIME the judgement of God will be handed down, the rule of Babylon brought to a final end and the Kingdom of God ushered in.

The mathematical formulae you have put forward to demonstrate the immorality of compound interest also demonstrate the folly of men when they attempt to abuse the Universal Moral Law in ways that are profitable to some but oppressive to others. They see that the Law shows them the way but they choose to use this knowledge to subvert the Law and use its power to oppress their fellow men.

What they are completely oblivious to is that the same Law will be used to judge them and bring them down to death. They believe that because God is merciful and has given them many hundreds of years to repent He must be unable or unwilling to judge them. They are now discovering that this is far from the truth. Indeed "Though the mills of God grind slowly, yet they grind exceeding small; Though with patience He stands waiting, with exactness grinds he all."

Thanks for a very interesting post.

"Jesus answered them: 'Truly, truly, I say to you, everyone who commits sin is a slave to sin. The slave does not remain in the house forever; the son remains forever. So if the Son sets you free, you will be free indeed.'" (John 8:34-36)

## Obviously

We speak very different languages because what you are saying is written in the language of religion. The one thing I have concluded about Mathematics is that it is objective.

It is interesting though because of the way religion can communicate. I have converted several evangelical neo-conservatives by using Chronicles 7-13/14, and explaining the lack thereof in our foreign policy.

Thank you for this very informed response.

## Uhh, yeah?

C'mon man! Are you serious? I dont want to see the "blueprints" to a mansion, I want to walk inside and even live there for awhile, soaking in the pool. To be blunt, people do not want theory and complicated theses. They want passion!

Let's Fight the Good Fight

## Your comment is not constructive

This is my passion. I want to reduce Keynesian economic theory to ashes.