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#6579439 - 06/09/12 Stagflation - the Kenysian Kryptonite
Siskiyous6 Offline
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Registered: 11/20/04
Posts: 6205
Loc: Del Norte County, State of Jef...
http://www.foxbusiness.com/economy/2012/06/08/ready-or-not-stagflation-is-here/

The solution is Austrian - free markets, sound currency, (extremely) limited government - if we can avoid the Nation States killing us all as they fall over and collapse, and we can preserve our technology, this is the best news you will ever hate.
_________________________
Ignorance is not confined to uneducated people.

RAND PAUL 2016!

WHO IS
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#6579473 - 06/09/12 Re: Stagflation - the Kenysian Kryptonite [Re: Siskiyous6]
2legit2quit Offline
Campfire 'Bwana

Registered: 04/19/10
Posts: 14336
Loc: cold & forbidden
That seems fairly accurate.


Good luck to us all.
_________________________
I'm pretty certain when we sing our anthem and mention the land of the free, the original intent didn't mean cell phones, food stamps and birth control.

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#6579579 - 06/09/12 Re: Stagflation - the Kenysian Kryptonite [Re: 2legit2quit]
DigitalDan Offline
Campfire Kahuna

Registered: 05/02/04
Posts: 24893
Loc: Yankeetown, Fl
Naw, I'd call it a 10X.
_________________________
I am..........disturbed.

"The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people."

The 10th Amendment to the U.S. Constitution. - RIP -




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#6579709 - 06/09/12 Re: Stagflation - the Kenysian Kryptonite [Re: DigitalDan]
Dawgin'it Offline
Member

Registered: 07/26/01
Posts: 122
Loc: Northern Utah
Stagflation is defined as a combination of high inflation and a stagnant economy. No question we currently have a stagnant economy, but high inflation too?? I dunno, but the current under 3% inflation rate is generally not considered a high at least by historical standards. Consequently, I personally find the article a bit of a stretch.

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#6579757 - 06/09/12 Re: Stagflation - the Kenysian Kryptonite [Re: Dawgin'it]
rockinkz Offline
Member

Registered: 12/25/04
Posts: 107
Low inflation rates and low interest rates are the product of govt. meddling with the economy. Remember the late 70's? High cost of money along with high inflation. Right now I think the problem is the folks with the money don't want to spend it because they're very nervous & holding onto cash.

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#6579967 - 06/09/12 Re: Stagflation - the Kenysian Kryptonite [Re: rockinkz]
Siskiyous6 Offline
Campfire Tracker

Registered: 11/20/04
Posts: 6205
Loc: Del Norte County, State of Jef...
The real inflation rate is far above 3% - the article points out the manipulation of statistics by Government.

True inflation is easily measured by the loss of value of the currency compared to hard assets, like gold. And that has risen at much more than 3%.

Every penny of the $5 Trillion "stimulus" is inflationary pressure.
_________________________
Ignorance is not confined to uneducated people.

RAND PAUL 2016!

WHO IS
JOHN GALT?


LIBERTY!











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#6581939 - 06/10/12 Re: Stagflation - the Kenysian Kryptonite [Re: Siskiyous6]
Dawgin'it Offline
Member

Registered: 07/26/01
Posts: 122
Loc: Northern Utah
Originally Posted By: siskiyous6
The real inflation rate is far above 3% - the article points out the manipulation of statistics by Government.

True inflation is easily measured by the loss of value of the currency compared to hard assets, like gold. And that has risen at much more than 3%.

Every penny of the $5 Trillion "stimulus" is inflationary pressure.


If that's the case, then the article makes even less sense, since gold prices have dropped over $300 per ounce since September 2011.

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#6582015 - 06/10/12 Re: Stagflation - the Kenysian Kryptonite [Re: rockinkz]
Oldelkhunter Offline
Campfire Outfitter

Registered: 09/28/04
Posts: 8783
Loc: North Carolina
Originally Posted By: rockinkz
Low inflation rates and low interest rates are the product of govt. meddling with the economy. Remember the late 70's? High cost of money along with high inflation. Right now I think the problem is the folks with the money don't want to spend it because they're very nervous & holding onto cash.


+1

Yes, I remember the Jimmy Carter years as well. I tried to buy my first house and mortgage rates were in the high teens.






















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#6582028 - 06/10/12 Re: Stagflation - the Kenysian Kryptonite [Re: Dawgin'it]
The_Real_Hawkeye Offline
Campfire Oracle

Registered: 06/12/02
Posts: 70619
Loc: Northern Florida
Originally Posted By: Dawgin'it
Originally Posted By: siskiyous6
The real inflation rate is far above 3% - the article points out the manipulation of statistics by Government.

True inflation is easily measured by the loss of value of the currency compared to hard assets, like gold. And that has risen at much more than 3%.

Every penny of the $5 Trillion "stimulus" is inflationary pressure.


If that's the case, then the article makes even less sense, since gold prices have dropped over $300 per ounce since September 2011.
A three hundred dollars drop isn't what a $300.00 drop would have been when gold was five or six hundred dollars per ounce. In modern (post QE) pricing, it represents a mere sixteen percent dip, which is well within the norm for metals over the years.
_________________________
"The Federal Reserve is one of the most corrupt institutions the world has ever known. It has impoverished the people of the United States through the corrupt practices of the moneyed vultures who control it." -- Congressman McFadden, 1932

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#6582030 - 06/10/12 Re: Stagflation - the Kenysian Kryptonite [Re: Dawgin'it]
Bristoe Offline
Campfire Oracle

Registered: 10/13/05
Posts: 39183
Loc: The Bluegrass
Originally Posted By: Dawgin'it
Originally Posted By: siskiyous6
The real inflation rate is far above 3% - the article points out the manipulation of statistics by Government.

True inflation is easily measured by the loss of value of the currency compared to hard assets, like gold. And that has risen at much more than 3%.

Every penny of the $5 Trillion "stimulus" is inflationary pressure.


If that's the case, then the article makes even less sense, since gold prices have dropped over $300 per ounce since September 2011.


The value of a currency is determined by the quantity of currency in circulation.

Every dollar put into circulation makes an existing dollar worth a bit less.

Essentially, inflation is an invisible tax. When the government needs money, the Federal Reserve just adds it to the government's books. It creates money out of thin air.

That makes the money that's already out there worth less.

So,...when the Federal Reserve prints up a few hundred billion dollars and gives it to the government, you still have that $20 bill in your wallet, but it will only buy what $19.50 would before an additional huge lump of money was printed up by the Federal Reserve and given to the government.

The Federal Reserve extracts the value from your money by simply printing up more of it.

That's inflation.
_________________________
The consolidation of the states into one vast republic, sure to be aggressive abroad and despotic at home, will be the certain precursor of that ruin which has overwhelmed all those that have preceded it.

-Robert E. Lee

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#6582045 - 06/10/12 Re: Stagflation - the Kenysian Kryptonite [Re: Bristoe]
The_Real_Hawkeye Offline
Campfire Oracle

Registered: 06/12/02
Posts: 70619
Loc: Northern Florida
Originally Posted By: Bristoe

The value of a currency is determined by the quantity of currency in circulation.

Every dollar put into circulation makes an existing dollar worth a bit less.

Essentially, inflation is an invisible tax. When the government needs money, the Federal Reserve just adds it to the government's books. It creates money out of thin air.

That makes the money that's already out there worth less.

So,...when the Federal Reserve prints up a few hundred billion dollars and gives it to the government, you still have that $20 bill in your wallet, but it will only buy what $19.50 would before an additional huge lump of money was printwed up by the Federal Reserve and given to the government.

The Federal Reserve extracts the value from your money by simply printing up more of it.

That's inflation.
If only more people understood this.
_________________________
"The Federal Reserve is one of the most corrupt institutions the world has ever known. It has impoverished the people of the United States through the corrupt practices of the moneyed vultures who control it." -- Congressman McFadden, 1932

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#6582495 - 06/10/12 Re: Stagflation - the Kenysian Kryptonite [Re: Siskiyous6]
eyeball Offline
Campfire Oracle

Registered: 03/23/11
Posts: 33058
Strange that this article mentions that Reagan lowered interest rates in the 80's to stimulate the economy and stop stagflation while the Newsmax's Aftershock survival Summit guy said that Reagan had raised interest rates to defeat stagflation.
_________________________

The tree of liberty must be refreshed from time to time by the blood of patriots and tyrants.

If being stupid allows me to believe in Him, I'd wish to be a retard. Eisenhower and G Washington should be good company.

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#6582520 - 06/10/12 Re: Stagflation - the Kenysian Kryptonite [Re: Siskiyous6]
derby_dude Offline
Campfire Oracle

Registered: 11/22/06
Posts: 34261
Loc: Montana, Lewis and Clark Count...
Originally Posted By: siskiyous6
http://www.foxbusiness.com/economy/2012/06/08/ready-or-not-stagflation-is-here/

The solution is Austrian - free markets, sound currency, (extremely) limited government - if we can avoid the Nation States killing us all as they fall over and collapse, and we can preserve our technology, this is the best news you will ever hate.


Welcome to the European satellite branch of America. For years we wanted to be like Europe and we have finally accomplished it at least economically. Of course, we have the International Banking Cartel to thank for this progressive effect.
_________________________
Don't vote knothead, it only encourages them. Anonymous

"Never underestimate the power of stupid people in large groups." Anonymous

"Self-reliance, free thinking, and wealth is anathema to both the power of the State and the Church." Derby Dude



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#6582627 - 06/10/12 Re: Stagflation - the Kenysian Kryptonite [Re: eyeball]
mike762 Offline
Campfire Tracker

Registered: 07/15/07
Posts: 6416
Originally Posted By: eyeball
Strange that this article mentions that Reagan lowered interest rates in the 80's to stimulate the economy and stop stagflation while the Newsmax's Aftershock survival Summit guy said that Reagan had raised interest rates to defeat stagflation.


Reagan didn't raise interest rates, Paul Volcker did as Chairman of the Fed in 1980. Reagan had not been elected when Volcker started doing so. Here's a brief synopsis of what happened and who did what.

http://www.buyandhold.com/bh/en/education/history/2000/paul_volker2.html

BTW, we'll be lucky if stagflation is all that we get out of this.
_________________________
If the American People allow private banks to control the issuance of their currency, first by inflation, then by deflation, the banks..., will deprive the People of all their Property,...Thomas Jefferson

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#6582654 - 06/10/12 Re: Stagflation - the Kenysian Kryptonite [Re: Dawgin'it]
mike762 Offline
Campfire Tracker

Registered: 07/15/07
Posts: 6416
Originally Posted By: Dawgin'it
Stagflation is defined as a combination of high inflation and a stagnant economy. No question we currently have a stagnant economy, but high inflation too?? I dunno, but the current under 3% inflation rate is generally not considered a high at least by historical standards. Consequently, I personally find the article a bit of a stretch.


If I were you, I'd take .gov (BLS) economic statistics with a large block of salt. They are gamed to show the most positive outlook FBO the Executive, and the CPI has been statistically manipulated to reduce payments to Social Security, and .gov/.mil retirement COLA's. Here's a site that is run by an economist who follows the CPI and employment stats the way they were calculated in 1980, before all the revisions were done to make the ongoing debasement of our currency look better.


http://www.shadowstats.com/alternate_data/inflation-charts
_________________________
If the American People allow private banks to control the issuance of their currency, first by inflation, then by deflation, the banks..., will deprive the People of all their Property,...Thomas Jefferson

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#6582680 - 06/10/12 Re: Stagflation - the Kenysian Kryptonite [Re: mike762]
2legit2quit Offline
Campfire 'Bwana

Registered: 04/19/10
Posts: 14336
Loc: cold & forbidden



filed under


figures don't lie, but liars figure

our gov't is so fing corrupt there's no humor in the subject for me any longer
_________________________
I'm pretty certain when we sing our anthem and mention the land of the free, the original intent didn't mean cell phones, food stamps and birth control.

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#6582691 - 06/10/12 Re: Stagflation - the Kenysian Kryptonite [Re: 2legit2quit]
isaac Offline
Campfire Oracle

Registered: 07/15/06
Posts: 57306
Loc: Northern Virginia
Good cover,Randy. I know you opened the thread because you thought "stagflation" had something to do with a sex party.
_________________________
The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails.
William Arthur Ward





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#6582702 - 06/10/12 Re: Stagflation - the Kenysian Kryptonite [Re: mike762]
eyeball Offline
Campfire Oracle

Registered: 03/23/11
Posts: 33058
I agree. The guy on the Newsmax program advertised free onfo on what to do until it was over then wanted to sell the recs.
_________________________

The tree of liberty must be refreshed from time to time by the blood of patriots and tyrants.

If being stupid allows me to believe in Him, I'd wish to be a retard. Eisenhower and G Washington should be good company.

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#6583170 - 06/10/12 Re: Stagflation - the Kenysian Kryptonite [Re: isaac]
2legit2quit Offline
Campfire 'Bwana

Registered: 04/19/10
Posts: 14336
Loc: cold & forbidden
lmao blush laugh


hate it when they can see through you like clean plate glass!
_________________________
I'm pretty certain when we sing our anthem and mention the land of the free, the original intent didn't mean cell phones, food stamps and birth control.

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#6584692 - 06/11/12 Re: Stagflation - the Kenysian Kryptonite [Re: Bristoe]
Dawgin'it Offline
Member

Registered: 07/26/01
Posts: 122
Loc: Northern Utah
Originally Posted By: Bristoe


The value of a currency is determined by the quantity of currency in circulation.

That's not really true. The value of currency is determined by how much people THINK it's worth. Think of it in terms of gold, is the price of gold only determined by the quantity out there?? Of course not.

Every dollar put into circulation makes an existing dollar worth a bit less.

Again, think in terms of gold, does every new ounce of gold mined make all the existing gold worth less??

Essentially, inflation is an invisible tax. When the government needs money, the Federal Reserve just adds it to the government's books. It creates money out of thin air.

That makes the money that's already out there worth less.

So,...when the Federal Reserve prints up a few hundred billion dollars and gives it to the government, you still have that $20 bill in your wallet, but it will only buy what $19.50 would before an additional huge lump of money was printed up by the Federal Reserve and given to the government.

The Federal Reserve extracts the value from your money by simply printing up more of it.

That's inflation.


You're correct, that is one way inflation is created, but it is not the only way and it is not absolute. That type of inflation is called demand push inflation......when you have too many dollars chasing too few goods. But what happens if the government "prints" a bunch of money but nobody spends it?? What is the effect on inflation then?? This seems to be why the latest surge of stimulus money hasn't created surge in inflation. Is it permanant?

The other type inflation is cost push that occurs on the supply side. This is the type of inflation that is generally associated with stagflation. This happens when an economy gets an external shock on the supply side that drives up costs. An example of this was the arab oil embargo of the 70's that drove oil prices up and sent shock waves through the U.S. economy. This was a case where we had low growth rates, high interest rates, AND high inflation rates (as measured by the consumer price index of course). That's why I say that the article posted at the top of the thread doesn't make much sense to me because we don't have the same type of conditions that we did when the term "stagflation" was coined.

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#6584718 - 06/11/12 Re: Stagflation - the Kenysian Kryptonite [Re: Dawgin'it]
SoTexasH Offline
Campfire Guide

Registered: 04/07/08
Posts: 2609
Loc: Lower RGV, Texas
I do know that I haven't gotten a raise for a couple of years and the prices at the grocery store are dramaticly higher in this time.

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#6584737 - 06/11/12 Re: Stagflation - the Kenysian Kryptonite [Re: Dawgin'it]
norm99 Offline
Campfire Tracker

Registered: 10/05/09
Posts: 5546
Loc: BC transplant to n alberta
good thread great info ,i'am learning

norm
_________________________
There is not enough darkness in all the world to put out the light of even one small candle----Robert Alden .

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#6584860 - 06/11/12 Re: Stagflation - the Kenysian Kryptonite [Re: Siskiyous6]
Penguin Offline
Campfire Tracker

Registered: 04/06/06
Posts: 5587
Loc: The great midwest
Originally Posted By: siskiyous6
Every penny of the $5 Trillion "stimulus" is inflationary pressure.


Not quite.

Most of the stimulus that has been used has been thrown at the largest banks. There are tremendous deflationary pressures coming from the banks due to a large horde of MBS and derivatives of such that are worth much less than the banks book them at. The combination of tremendous stimulus (via pawning off about half of these toxic assets on the GSEs and the central bank) versus tremendous deflationary pressures (via the other half of the ilk that they still own) has been largely... nothing.

This is why there has yet to be the hyperinflation that the hardcore, and unwise, Austrian contingent predicted.

There is a large dose of inflation coming but not from this source, at least not yet. Some of this will come about and another bunch will come when foreign held dollars seep into the market. TPTB are trying for a long slow decline as opposed to the market clearing that we should have done 5 years ago.

As far as Keynes goes, don't blame him. Had we held to true Keynes principles we would have run a budget surplus when time were good not given large tax breaks into the teeth of a yawning trade deficit. MOF the trade deficit wouldn't have been allowed to occur under a Keynesian managed economy either. He correctly predicted that as economic poison that would eventually bankrupt a nation.

I take economic ideas where I find them. Almost all of them have at least a grain of wisdom in them. But for this situation I honestly believe that understanding Keynes (the real Keynes not the parody of him that is pandered by those who disagree with him) and Triffin is enough to understand what has happened and why most everyone on both sides of the aisles has been dead wrong about it for years on end.

Will
_________________________
Smellin' a lot of 'if' coming off this plan.

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#6584891 - 06/11/12 Re: Stagflation - the Kenysian Kryptonite [Re: SoTexasH]
The_Real_Hawkeye Offline
Campfire Oracle

Registered: 06/12/02
Posts: 70619
Loc: Northern Florida
Originally Posted By: SoTexasH
I do know that I haven't gotten a raise for a couple of years and the prices at the grocery store are dramaticly higher in this time.
So you've had a pay cut, courtesy of our friends at the Fed. Every time they increase the supply of currency, they give everybody a pay cut in order to envalue (if you will) the new money they're bringing into existence. You see, the sum total of all the money in existence possesses X value (roughly equal to the value of every good, service, and product available for purchase at any given time). Each dollar's value is X divided by the number of dollars in existence (M). When you increase the number of the units of X, you thereby decrease the value of each unit accordingly (the number of units, or dollars (M), being the denominator, and X being the numerator). That decrease in the value of each unit (dollar) is where the value now residing in the new currency came from. In other words, you can't create new value by printing new units of X (i.e., by increasing M). All you can accomplish by increasing the currency supply (M) is to redistribute the total value of X that's already in existence.

This is why a nation cannot become wealthier overall by printing more currency. That only redistributes the wealth from those who currently hold it, to those who receive the newly printed money, i.e., the banks, their partners in government, and the "too big to fails."

Expanding the currency supply ("printing") is a very sophisticated form of theft. It's why counterfeiting is a crime. It leaves the actual currency in our pockets untouched, but sucks out a portion of the value of each dollar in our pockets and places it into the newly printed currency by simple operation of mathematics (X over M). It's a zero sum game.
_________________________
"The Federal Reserve is one of the most corrupt institutions the world has ever known. It has impoverished the people of the United States through the corrupt practices of the moneyed vultures who control it." -- Congressman McFadden, 1932

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