Time To Get Out The Wheelbarrows? Another Look At The Weimar Hyperinflation.
The Real Weimar Threat and How It Can Be Avoided
Is the United States, then, out of the hyperinflationary woods with its “quantitative easing” scheme? Maybe, maybe not. To the extent that the newly-created money will be used for real economic development and growth, funding by seigniorage is not likely to inflate prices, because supply and demand will rise together. Using quantitative easing to fund infrastructure and other productive projects, as in President Obama’s stimulus package, could invigorate the economy as promised, producing the sort of abundance reported by Benjamin Franklin in America’s flourishing early years.
There is, however, something else going on today that is disturbingly similar to what triggered the 1923 hyperinflation. As in Weimar Germany, money creation in the U.S. is now being undertaken by a privately-owned central bank, the Federal Reserve; and it is largely being done to settle speculative bets on the books of private banks, without producing anything of value to the economy. As gold investor James Sinclair warned nearly two years ago:
“[T]he real problem is a trembling $20 trillion mountain of over the counter credit and default derivatives. Think deeply about the Weimar Republic case study because every day it looks more and more like a repeat in cause and effect . . . .”9
The $12.9 billion in bailout funds funneled through AIG to pay Goldman Sachs for its highly speculative credit default swaps is just one egregious example.10 To the extent that the money generated by “quantitative easing” is being sucked into the black hole of paying off these speculative derivative bets, we could indeed be on the Weimar road and there is real cause for alarm. We have been led to believe that we must prop up a
Gary North Slams Ellen Brown, whose articles I enjoy . . .
A web page by Ellen Brown is making the rounds. It is here.
Ellen Brown is a lawyer. She is anti-Federal Reserve. So, she gets a hearing in conservative circles. This is unfortunate. There is nothing conservative about her. She is an apologist for statism and the United States Treasury (a wholly owned subsidiary of Goldman Sachs).
Her article is about the hyperinflation of Germany, 1921–23. She has no understanding of what happened or why, but she talks as if she does.
If you want the real story on the German hyperinflation, you can get it on the Mises.org site. All of these are available for free.
First, there is Hans Sennholz's article, "Hyperinflation in Germany."
http://lewrockwell.com/north/north715.html
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Medium of Exchange
Tom Woods made a great comment that you cannot produce wealth simply by increasing the medium of exchange. I wonder about the Daily Paul sometimes. This site can change directions on a dime!
It shows even we need to be very sure of what our principals are and why they are right, otherwise we are just as susceptible to being swept away by a charismatic figure as anyone.
This may explain why it
This may explain why it hasn't crashed yet:
http://www.youtube.com/watch?v=FpZ7kpT-izI&feature=email
Global Warming Swindle
The amount of Taxes being slammed on us by the Energy and Climate Nazis, will prob keep Hyperinflation away for a little while longer....
The prediction of 1 to 2 years is a good one.
trust me i dont agree with
trust me i dont agree with pollution, but i wont touch any other subject yet
Question for you
Question for you xtrabiotoxin- do you believe that humans have (since the industrial revolution) emitted enough carbon dioxide, methane, and other greenhouse gasses to alter the climate in a measurable way? Clearly climate trends around the world are changing, in my home state of California we have seen some pretty intense droughts in the last few years accompanied by heat waves. Do you think humans have contributed to this only marginally, are the primary cause of it, or are a no-factor? Not trying to criticize, I'm searching for the truth myself on this issue...
"The sinews of war are infinite money" ~ Cicero
"The sinews of war are infinite money" ~ Marcus Tullius Cicero
As the Mogambo guru says-
As the Mogambo guru says- "Get yourself a safe, some silver, and large caliber weapon!" Couldn't agree more!
As to this whole idea of printing money for infrastructure improvements and whatnot, this assumes that the inflation in the money supply will be equally matched by an increase in efficiency (that is really what we are talking about, not an increase in production which requires additional resources) in the sectors the money is pumped into. Seems like playing with fire to me... what happened to the good old days when people borrowed saved money for improvements rather than printing it? Then an increase in production/transportation/whatever efficiency would yield an increase in the standard of living and available wealth, not simply race to try to keep up with the expanding money supply.
Just my .02 federal reserve notes on the matter.
"The sinews of war are infinite money" ~ Cicero
"The sinews of war are infinite money" ~ Marcus Tullius Cicero
The Way I See It
The Fed cannot continue to buy treasury debt. Once they stop the rates will rise. After Treasury can't sell more IOU's, they will print FRN's. Watch out for new bills. The ones they are using are mostly 2004 and 2006 issue. When they print, hyper-inflation will start. A year to a year and a half from now as is predicted, IMHO is probably 6 to 12 months.
Sheldon Waxman
sheldonw72@gmail.com
www.thelawyer.info
www.independentcontractor.info
Sheldon Waxman
sheldonw72@gmail.com
www.independentcontractor.info
www.thelawyer.info
Tell Me Ron Paul Supporters Aren't Money Cranks
This article is utter drivel from start to finish. I am shocked that people at the Daily Paul of all places would agree with this. This is economic nonsense -- the idea that inflation is OK if the new money funds productive investment is intellectually contemptible. To see the fallacy, imagine how that would work in a barter economy. She is confused by the phenomenon of money, which she thinks is wealth. Printing up new money doesn't create any new stuff. All it does is allow favored recipients to bid an unchanged resource pool away from firms consumers genuinely favor and toward their own crummy selves.
How, oh how, could Ron Paul supporters favor this woman?
On top of that, she cites the leftist money crank Stephen Zarlenga, whom leftist radio man and free market enemy Thom Hartmann loves.
Keep the nonsense away. I do not want to do away with the Fed so I can have this woman's crummy greenbacks instead. Talk about a phony choice!
I am in agreement with you
I am in agreement with you on this, she is no friend to the ideals supported by Dr. Paul and she ranks with the same caliber of crack-pots as Montagne and Dale.
Indeed, there would have to be an equally as onerous quasi-political banking body needed to "manage" any Treasury Greenback monetary system...we would trade one master for another and most likely the same people would be running the newly formed "Central Greenback Bank". Anytime we place trust and control of money in the hands of government and its agencies then our liberty remains threatened.
http://www.1776solution.blogspot.com
"In the creation of the federal government, the states exercised the highest act of sovereignty, and they may, if they please, repeat the proof of their sovereignty, by its annihilation."
http://militantjeffersonian.com
"Men do not willingly read unpalatable truths of themselves. The People like those best who fool them most, by pandering to their vices and flattering their foibles" Raphael Semmes
Her "viable" solution is more economic power to the government..
"""There is another viable alternative, and it may prove to be our only viable alternative. We can beat Wall Street at its own game, by forming publicly-owned banks that issue the full faith and credit of the United States not for private speculative profit but as a public service, for the benefit of the United States and its people."""
This was prob her biggest mistake, citing this. Probably proves she is trying to push propaganda.
Good to learn from tho!
Oh dear!
To the extent that the newly-created money will be used for real economic development and growth, funding by seigniorage is not likely to inflate prices, because supply and demand will rise together.
Christ, what a load of rubbish!
Further details here: http://www.econlib.org/library/Bastiat/basEss1.html
Where does money come from?
Motley Fool says . . .
Ron Paul may force Congress to ask the question "Where does money come from?", but they'll be content with the answer written on the back of the dollar bill with that pyramid-eye thing because they are too stupid to understand it any deeper than that.
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Web of Debt~ excellent book!
I reccomend reading her book!
********
"I truly wish that real life would no longer surpass the worst excesses of my nightmarish imaginings... Arthur Silber **
"I think we are living in a world of lies: lies that don't even know they are lies, because they are the children and grandchildren of lies." ~ Chris Floyd
Yep
That book is great. Reads like the Wizard of Oz story on which it is based. Very readable--great companinion to Ed Griffin's Jekyll Island book
Ellen Brown
should be a member of Daily Paul
bump for
others, good discussion.
Prepare & Share the Message of Freedom through Positive-Peaceful-Activism.
Indeed
check out the author's site for other articles
www.WebOfDebt.com
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Agree with that bobby: "dollar tumbles after downbeat Fed"
Global stocks slip, dollar tumbles after downbeat Fed
By Natsuko Waki Natsuko Waki – Thu May 21, 4:17 am ET
LONDON (Reuters) – World stocks slipped from this week's six-month peak and the dollar fell to its lowest in almost five months on Thursday after the Federal Reserve lowered its forecast of U.S. economic growth for the next three years.
Minutes from its April meeting showed the Fed projected the world's biggest economy to contract by up to 2 percent this year with the unemployment rate rising to as high as 9.6 percent.
They also showed that Fed policymakers had considered buying more securities to spur recovery -- a move which would inject more dollars into the market.
More:
http://news.yahoo.com/s/nm/20090521/bs_nm/us_markets_global_23
As the Dollar Falls, Gas and Food Prices
Skyrocket.
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?
Isn't it more valid to say the amount of (fiat) dollars it takes to buy these things is what is increasing?
The more money 'they' print the less it is worth so it takes more of them to buy the product. You know, the old story about how in Roman days a nice toga, a good belt and a pair of sandals cost a one oz. gold coin, and the same holds true today for a decent suit, belt and shoes. It is the value of the fiat dollars that is worth less.
Monetization of debt that cannot be repaid
is central to the phenomenon of hyperinflation. In Weimar it was the monetization of war reparations and in today's financial environment it is the monetization of OTC credit default derivatives. Sinclair correctly points out that hyperinflation is a currency event, not an economic event, and tends to occur during contracting economic conditions. Something could have been done a couple of years ago to right the ship, but that was not acceptable to the banksters and politricksters. It's too late now to avoid the destruction of our currency. All we can do now is watch as our dollar, our economy and the financial world as we have known it go over the cliff in slow motion. Good luck to us all.
Gil,
I'm not so sure that it is going to be "slow motion" anymore.
http://quotes.ino.com/chart/?s=NYBOT_DX&v=d12&w=1&t=f&a=200
A free market will never exist as long as there is monopoly control over the money supply.
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"the only thing that keeps the banking system from failing is general ignorance about how the banking system works."
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e_
I know exactly what you're saying. Events are taking place right now that are causing this drama to accelerate. It appears very clear to me right now, and the level of detail makes it seem like it's happening in slow motion. This is going to be a wild-ass ride!
Exactly
The author wrote a book caled WEB OF DEBT about this
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Didn't hyperinflation depend upon a gold standard?
Because each note represented real value? It would seem to be much easier to control hyperinflation now because there is nothing of real value to convert to. Were Weimar notes convertible?
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No.
You are wrong.
Ron Paul 2012
www.josiahgarber.com/blog
www.heirloomgardenpro.com
www.mennonitesforronpaul.com
How can I be wrong when I'm asking a question?
I don't know anything about money but I'm trying to learn.
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Perhaps you should get a job at the Fed!
Just kidding.
They don't know anything about money either.
grant
I saw this "recent comment" and knew it was for me
I thought the SAME thing when I was typing that!
I think I really do know quite a bit about the nature of money, the history of money, and how it is manipulated, but I don't understand things like hyperinflation. I've done a lot of reading about it, but still don't understand how it happens when the rubber meets the road.
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