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TOPIC OF THE WEEK: Monetary Regime Changes

ResponsiblyIrresponsible
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5/31/2015 3:25:25 PM
Posted: 1 year ago
The conventional narrative says that once output deviates from potential and inflation from target, the Federal Reserve can mechanically adjust interest rates in accordance with a Taylor Rule [1], an objective function that provides a benchmark for its operating target, the short-term, overnight, interbank lending rate known as the federal funds rate. The rule looks something like this:

i = r + pi + .5 (pi - pi*) + .5 (Y - Y*)

where,
i = nominal federal funds rate
r = long-run Wicksellian equilibrium real rate, 2 percent
pi = current core inflation rate
pi* = inflation target, 2 percent
Y = log real output
Y* = log real potential output

Thus, during normal times, when the economy is at full employment and output is at potential, the nominal federal funds rate should be equal to the real rate of return on investment plus the inflation rate. Thus, the historical average for the nominal federal funds rate via this rule would be close to 4 percent, and it bears mentioning that actual policy interest rates generally track this pattern over the longer run.

There are several implications if policy always tracked this rule. First, if we accepted the premise - and I don"t - that nominal interest rates can"t fall below zero because people will hold cash, then the Taylor Rule breaks down once policy interest rates reach their zero lower bound. Thus, the Taylor Rule would have been futile from December 2008 onward, provided that we agreed with Janet Yellen that further accommodation was necessary to circumvent a Depression-esque scenario (though versions of this rule would currently suggest a fed funds rate around 1 percent). Second, the Wicksellian equilibrium real rate - or the market-clearing interest rate consistent with full employment and stable inflation - would be static, and simply reducing nominal interest rates such that real rates fall below 2 percent would result in an accommodative policy; by extension, raising the nominal policy rate such that real rates rise above 2 percent would be consistent with a tight policy. Third, changes in the operating target are consistent with and proportional to movements in goal variables: nominal GDP and inflation.

Now, this wouldn"t be an economics post if I weren"t willing to refer you to my "other hand." It"s reasonable to think that there"s a time where these assumptions may hold, though I don"t think there"s any reason to be confident that they hold now or that they always hold. First, we know that nominal interest rates can in fact fall below zero: Europe and Australia have been doing it for some time [2]. The logic is that the storage costs of holding vast quantities of cash result in an effective lower bound a few points below zero. Second, the natural rate of interest is time-varying, and there"s reason to think that it has been - and remains - substantially below zero in real terms [3], far below historical standards, and may remain there for a multiplicity of factors, one of which is a secular drop-off in productivity growth, either by virtue of waning IT gains [4] or a byproduct of the severe recession [5]. Not to mention, a fall in the labor force participation rate, much of which is structural in nature [6] due partly to hysteresis amongst the long-term unemployed [7], has arguably shifted the LRAS backward such that trend output has fallen, perhaps permanently, by about 70 to 100 basis points [8], and this may be compounded by both demographic trends and the persistent structural headwinds of household deleveraging, declining rates of business formation, and elevated credit standards.

The third point is worth accentuating because it functions as the central underpinning of a monetary regime. At present, inflation remains well below target in spite of the fact that the fed funds rate has been at zero since late 2008, and in spite of a nearly 400 percent ballooning of the Fed"s balance sheet via purchases of long-term government debt and agency mortgage-backed securities. Clearly, something has gone wrong, lest we"d be at full employment. In fact, perhaps the inflationista story would have panned out: long-term rates should have spiked, inflation should be soaring well above target, and foreigner investors should disband their dollar-denominated assets as though they"re hot potatoes.

That isn"t the case, though: in fact, the dollar has actually been on the rise as late [9] (and, of note is that flight-to-safety flows of this kind also took place at the heart of the crisis in 2008, which is far from typical amid systemic downturns). Clearly, something has gone wrong, and it"s what fellows like Kocherlakota [10], Sumner [11], and Evans [12] have been telling us for a while: we cannot look at interest rates, or more finitely operating targets, to get a sense of whether policy is tight or loose. As Ben Bernanke well put it in 2003 - and, for that matter, I highly recommend his recent IMF speech on the future of monetary policy[10] - the only way to properly gauge the stance of policy is by looking at nominal GDP and inflation [13]. One need only look at Japan, which was trapped into a two-decade-long deflationary spiral in spite of zero-bound interest rates, to see that a policy prescribed by the Taylor Rule need not be sufficient at closing an output gap. Thus, an approach of constrained discretion is to some degree necessary [14], which explains why the Fed has been undertaking unconventional policy measures - asset purchases and forward guidance - for the past six years.

But what most pundits, and even sometimes brilliant economists like Alan Blinder and Paul Krugman, get wrong is that monetary policy is not dead in the water once interest rates hit zero: we"re not in a liquidity trap, nor is countercyclical fiscal stimulus a necessary palliative. Krugman actually acknowledged this back in 1998 when he wrote on Japan, stating that a central bank that finds itself at the lower bound of its policy interest rate should "credibly commit to being irresponsible" [15]. His research was later corroborated by several who remain big names in the economics profession: Svensson [16], Woodford [17], Eggertsson [18], and Mishkin [19].

To reiterate, the central problem we now face is a need to provide policy accommodation at a time when we can no longer reduce nominal interest rates. After all, as Milton Friedman once famously noted, low interest rates signal not that policy is loose, but that it was tight. Is monetary policy impotent, consistent with the classic analogy of "pushing on strings?"

No, especially with a monetary regime change: a fundamental change to the structural underpinning of policy. That could constitute a formal commitment to a permanently elevated balance sheet, transitioning to a higher inflation target [20], or a price-level target [21], or even - my personal favorite - a nominal GDP level target. Each of these new frameworks would solidify a credible commitment to nonconventional policy easing even once rates reach zero and the Fed runs low on conventional ammunition, and rightly removes the focus from nominal interest rates.

It's a time for helicopter drops. It turns out there is such a thing as a free lunch.

References
1. http://tinyurl.com...
2. http://tinyurl.com...
3. http://tinyurl.com...
4. http://tinyurl.com...
5. http://tinyurl.com...
6. http://tinyurl.com...
7. http://tinyurl.com...
8. http://tinyurl.com...
9. http://tinyurl.com...
10. http://tinyurl.com...
11. http://tinyurl.com...
12. http://tinyurl.com...
13. http://tinyurl.com...
14. http://tinyurl.com...
15. http://tinyurl.com...
16. http://tinyurl.com...
17. http://tinyurl.com...
18. http://tinyurl.com...
19. http://tinyurl.com...
20. http://tinyurl.com...
21. http://tinyurl.com...
22. http://tinyurl.com...
~ResponsiblyIrresponsible

DDO's Economics Messiah
ESocialBookworm
Posts: 14,354
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5/31/2015 4:03:57 PM
Posted: 1 year ago
*looks at sources*

.
.
.

Yeah, you would.
Solonkr~
I don't care about whether an ideology is "necessary" or not,
I care about how to solve problems,
which is what everyone else should also care about.

Ken~
In essence, the world is fucked up and you can either ignore it, become cynical or bitter about it.

Me~
"BAILEY + SOLON = SAILEY
MY SHIP SAILEY MUST SAIL"

SCREW THAT SHIZ #BANNIE = BAILEY & ANNIE

P.S. Shipped Sailey before it was cannon bitches.
ResponsiblyIrresponsible
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5/31/2015 4:05:07 PM
Posted: 1 year ago
At 5/31/2015 4:03:57 PM, ESocialBookworm wrote:
*looks at sources*

.
.
.

Yeah, you would.

All in a day's work.

Unlike the zero rate lower bound on nominal interest rates, the 8000-character limit is in fact binding.
~ResponsiblyIrresponsible

DDO's Economics Messiah
ESocialBookworm
Posts: 14,354
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5/31/2015 4:05:40 PM
Posted: 1 year ago
At 5/31/2015 4:05:07 PM, ResponsiblyIrresponsible wrote:
At 5/31/2015 4:03:57 PM, ESocialBookworm wrote:
*looks at sources*

.
.
.

Yeah, you would.

All in a day's work.

Unlike the zero rate lower bound on nominal interest rates, the 8000-character limit is in fact binding.

LOL
Solonkr~
I don't care about whether an ideology is "necessary" or not,
I care about how to solve problems,
which is what everyone else should also care about.

Ken~
In essence, the world is fucked up and you can either ignore it, become cynical or bitter about it.

Me~
"BAILEY + SOLON = SAILEY
MY SHIP SAILEY MUST SAIL"

SCREW THAT SHIZ #BANNIE = BAILEY & ANNIE

P.S. Shipped Sailey before it was cannon bitches.
ResponsiblyIrresponsible
Posts: 12,398
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5/31/2015 4:06:11 PM
Posted: 1 year ago
At 5/31/2015 4:05:40 PM, ESocialBookworm wrote:
At 5/31/2015 4:05:07 PM, ResponsiblyIrresponsible wrote:
At 5/31/2015 4:03:57 PM, ESocialBookworm wrote:
*looks at sources*

.
.
.

Yeah, you would.

All in a day's work.

Unlike the zero rate lower bound on nominal interest rates, the 8000-character limit is in fact binding.

LOL

Econ jokes are love and life, and all that other stuff.
~ResponsiblyIrresponsible

DDO's Economics Messiah
ESocialBookworm
Posts: 14,354
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5/31/2015 4:08:40 PM
Posted: 1 year ago
At 5/31/2015 4:06:11 PM, ResponsiblyIrresponsible wrote:
At 5/31/2015 4:05:40 PM, ESocialBookworm wrote:
At 5/31/2015 4:05:07 PM, ResponsiblyIrresponsible wrote:
At 5/31/2015 4:03:57 PM, ESocialBookworm wrote:
*looks at sources*

.
.
.

Yeah, you would.

All in a day's work.

Unlike the zero rate lower bound on nominal interest rates, the 8000-character limit is in fact binding.

LOL

Econ jokes are love and life, and all that other stuff.

Kinky
Solonkr~
I don't care about whether an ideology is "necessary" or not,
I care about how to solve problems,
which is what everyone else should also care about.

Ken~
In essence, the world is fucked up and you can either ignore it, become cynical or bitter about it.

Me~
"BAILEY + SOLON = SAILEY
MY SHIP SAILEY MUST SAIL"

SCREW THAT SHIZ #BANNIE = BAILEY & ANNIE

P.S. Shipped Sailey before it was cannon bitches.
ResponsiblyIrresponsible
Posts: 12,398
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5/31/2015 4:13:54 PM
Posted: 1 year ago
At 5/31/2015 4:08:40 PM, ESocialBookworm wrote:
At 5/31/2015 4:06:11 PM, ResponsiblyIrresponsible wrote:
At 5/31/2015 4:05:40 PM, ESocialBookworm wrote:
At 5/31/2015 4:05:07 PM, ResponsiblyIrresponsible wrote:
At 5/31/2015 4:03:57 PM, ESocialBookworm wrote:
*looks at sources*

.
.
.

Yeah, you would.

All in a day's work.

Unlike the zero rate lower bound on nominal interest rates, the 8000-character limit is in fact binding.

LOL

Econ jokes are love and life, and all that other stuff.

Kinky

It doesn't quite comport with my definition of "kinky."
~ResponsiblyIrresponsible

DDO's Economics Messiah
Chang29
Posts: 732
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5/31/2015 7:59:09 PM
Posted: 1 year ago
A great monetary regime change would be to end monetary central planning. An economy with centrally planned targets for aggregate measures creates inefficiencies. People and firms can agree on interest rates without central planning, no inflation targets, no curves involved. Two people agreeing on an interest rate that is mutually beneficial is the best interest rate.
A free market anti-capitalist

If it can be de-centralized, it will be de-centralized.
ResponsiblyIrresponsible
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5/31/2015 9:47:39 PM
Posted: 1 year ago
At 5/31/2015 7:59:09 PM, Chang29 wrote:
A great monetary regime change would be to end monetary central planning. An economy with centrally planned targets for aggregate measures creates inefficiencies. People and firms can agree on interest rates without central planning, no inflation targets, no curves involved. Two people agreeing on an interest rate that is mutually beneficial is the best interest rate.

Glad to see that you've returned, as passionate (yet misguided) as ever.
~ResponsiblyIrresponsible

DDO's Economics Messiah
Diqiucun_Cunmin
Posts: 2,710
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5/31/2015 11:06:02 PM
Posted: 1 year ago
At 5/31/2015 4:05:07 PM, ResponsiblyIrresponsible wrote:
At 5/31/2015 4:03:57 PM, ESocialBookworm wrote:
*looks at sources*

.
.
.

Yeah, you would.

All in a day's work.

Unlike the zero rate lower bound on nominal interest rates, the 8000-character limit is in fact binding.

LOL!

You know what's binding? https://en.wikipedia.org...

In all seriousness, I'll try to read your post later.
The thing is, I hate relativism. I hate relativism more than I hate everything else, excepting, maybe, fibreglass powerboats... What it overlooks, to put it briefly and crudely, is the fixed structure of human nature. - Jerry Fodor

Don't be a stat cynic:
http://www.debate.org...

Response to conservative views on deforestation:
http://www.debate.org...

Topics I'd like to debate (not debating ATM): http://tinyurl.com...
Chang29
Posts: 732
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6/1/2015 2:00:05 AM
Posted: 1 year ago
At 5/31/2015 9:47:39 PM, ResponsiblyIrresponsible wrote:
At 5/31/2015 7:59:09 PM, Chang29 wrote:
A great monetary regime change would be to end monetary central planning. An economy with centrally planned targets for aggregate measures creates inefficiencies. People and firms can agree on interest rates without central planning, no inflation targets, no curves involved. Two people agreeing on an interest rate that is mutually beneficial is the best interest rate.

Glad to see that you've returned, as passionate (yet misguided) as ever.

I'll be on and off. A free society especially monetary freedom is never misguided.

Central planning is terrible regardless of context. Government central planners could not plan toothbrush distribution, yet almost every citizen of a country is dependant on a central bankers planning ability.
A free market anti-capitalist

If it can be de-centralized, it will be de-centralized.
ResponsiblyIrresponsible
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6/1/2015 8:08:45 AM
Posted: 1 year ago
At 6/1/2015 2:00:05 AM, Chang29 wrote:
I'll be on and off. A free society especially monetary freedom is never misguided.

I think our definitions of monetary freedom are in stark contrast.

Central planning is terrible regardless of context. Government central planners could not plan toothbrush distribution, yet almost every citizen of a country is dependant on a central bankers planning ability.

It's not central planning, and this post even accentuates that nominal interest rates are irrelevant, so I don't even want the Fed setting a target range for borrowing costs.

This is *really* off-topic, though, and has nothing to actually do with monetary regime changes. I much prefer we stick to that.
~ResponsiblyIrresponsible

DDO's Economics Messiah
Chang29
Posts: 732
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6/1/2015 6:51:03 PM
Posted: 1 year ago
At 6/1/2015 8:08:45 AM, ResponsiblyIrresponsible wrote:
At 6/1/2015 2:00:05 AM, Chang29 wrote:
I'll be on and off. A free society especially monetary freedom is never misguided.

I think our definitions of monetary freedom are in stark contrast.

Your definition is lacking freedom and key functions of money.

Central planning is terrible regardless of context. Government central planners could not plan toothbrush distribution, yet almost every citizen of a country is dependant on a central bankers planning ability.

It's not central planning, and this post even accentuates that nominal interest rates are irrelevant, so I don't even want the Fed setting a target range for borrowing costs.

The Fed are central planners, this post is about the effects of central planning. If the central planners get the rate wrong, then you explain many of the effects. The central planning is the problem, every pays when central planners are wrong.

This is *really* off-topic, though, and has nothing to actually do with monetary regime changes. I much prefer we stick to that.

This is *right* on topic! I too want momentary regime changes, that is elimination of central monopolistic monetary policy. Money should be like any other product that a market delivers to us, no need for a central bank. The equation at the beginning has an unstated assumption, every holder of currency must continue utilization of this currency. There is no variable for people that change to another currency due to poor monetary regime policies. It is nice for central currency planners to have the force of law to limit variable in equations.
A free market anti-capitalist

If it can be de-centralized, it will be de-centralized.
ResponsiblyIrresponsible
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6/1/2015 6:51:36 PM
Posted: 1 year ago
At 6/1/2015 6:51:03 PM, Chang29 wrote:

*sigh*

I'll respond to this when I finish some other stuff... if I forgot, send me a notification.
~ResponsiblyIrresponsible

DDO's Economics Messiah
ResponsiblyIrresponsible
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6/5/2015 5:40:55 PM
Posted: 1 year ago
At 6/1/2015 6:51:03 PM, Chang29 wrote:

Okay, now I can respond to this.

Your definition is lacking freedom and key functions of money.

I think a free flow of money is necessary for freedom - wouldn't you agree? The key functions of money are (a) medium of exchange, (b) unit of account, and (c) store of value. Which of those am I missing?

The Fed are central planners, this post is about the effects of central planning. If the central planners get the rate wrong, then you explain many of the effects. The central planning is the problem, every pays when central planners are wrong.

But I'm not for setting that rate, nor does the Fed ever physically *set* interest rates. They set a target range and influence markets as such, though nevertheless market participants and their reaction to Fed policy is ultimately what drives economic activity. Sure, the Fed *has* screwed up, but insofar as it's following the correct intermediate target, I cannot foresee this as an issue, especially when it's a credible inflation fighter.

cThis is *right* on topic! I too want momentary regime changes, that is elimination of central monopolistic monetary policy.

That's not a monetary regime change, lol. It's like saying "let's change my wardrobe by going naked!" You're coming from the assumption - which is flawed, might I add - that monetary policy already is ipso facto immoral. I'm asking how we can fine-tune policy so that we can mitigate any residual inefficiencies and actually achieve objectives in a shorter, smoother period of time.

TMoney should be like any other product that a market delivers to us, no need for a central bank.

So, private money? I cannot see free banking being a plausible system in any way, shape or form, though that's truly beside the point.

The equation at the beginning has an unstated assumption, every holder of currency must continue utilization of this currency.

You mean the equation I disavowed - the pitfalls of which this entire post is predicated on?

I don't think it makes that assumption at all. In fact, the purpose of monetary easing is to *get* people to do something more risky with their money, so it operates under the assumption that tight money will encourage people not to utilize their money.

There is no variable for people that change to another currency due to poor monetary regime policies.

Yes there is - it's called the exchange rate. That feeds through to exports, and thus to inflation and NGDP, and may even transmit to interest rates.

It is nice for central currency planners to have the force of law to limit variable in equations.

What variables are they limiting? Because I don't see that at all.
~ResponsiblyIrresponsible

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Chang29
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6/5/2015 6:59:35 PM
Posted: 1 year ago
At 6/5/2015 5:40:55 PM, ResponsiblyIrresponsible wrote:
At 6/1/2015 6:51:03 PM, Chang29 wrote:

Okay, now I can respond to this.

Your definition is lacking freedom and key functions of money.

I think a free flow of money is necessary for freedom - wouldn't you agree? The key functions of money are (a) medium of exchange, (b) unit of account, and (c) store of value. Which of those am I missing?

Today, Money is not free flowing, it is controlled by a monopolistic quasi unaccountable government institution. Store of value also no longer applies to US currency.

The Fed are central planners, this post is about the effects of central planning. If the central planners get the rate wrong, then you explain many of the effects. The central planning is the problem, every pays when central planners are wrong.

But I'm not for setting that rate, nor does the Fed ever physically *set* interest rates. They set a target range and influence markets as such, though nevertheless market participants and their reaction to Fed policy is ultimately what drives economic activity. Sure, the Fed *has* screwed up, but insofar as it's following the correct intermediate target, I cannot foresee this as an issue, especially when it's a credible inflation fighter.

No institution should have that kind of power, let markets function. When the fed is wrong everyone pays, except government.


cThis is *right* on topic! I too want momentary regime changes, that is elimination of central monopolistic monetary policy.

That's not a monetary regime change, lol. It's like saying "let's change my wardrobe by going naked!" You're coming from the assumption - which is flawed, might I add - that monetary policy already is ipso facto immoral. I'm asking how we can fine-tune policy so that we can mitigate any residual inefficiencies and actually achieve objectives in a shorter, smoother period of time.

Elimination is the best fine tuning. If the piano is broken, tuning a few key is not going to help.

TMoney should be like any other product that a market delivers to us, no need for a central bank.

So, private money? I cannot see free banking being a plausible system in any way, shape or form, though that's truly beside the point.

Private money, multi-currencies, foreign currencies, there are many ideas, the Fed should not have central planing monopoly power over the American economy.


The equation at the beginning has an unstated assumption, every holder of currency must continue utilization of this currency.

You mean the equation I disavowed - the pitfalls of which this entire post is predicated on?

I don't think it makes that assumption at all. In fact, the purpose of monetary easing is to *get* people to do something more risky with their money, so it operates under the assumption that tight money will encourage people not to utilize their money.

There is no variable for people that change to another currency due to poor monetary regime policies.

Yes there is - it's called the exchange rate. That feeds through to exports, and thus to inflation and NGDP, and may even transmit to interest rates.

It is nice for central currency planners to have the force of law to limit variable in equations.

What variables are they limiting? Because I don't see that at all.

If a second or more currencies were legal, the number of variables would increase.

The idea that central planning is needed for monetary policy is the issue, Americans can not opt out of Federal reserve policies. Free market of money and currencies would end the idea of economic enfluence by monetary policy.
A free market anti-capitalist

If it can be de-centralized, it will be de-centralized.
ResponsiblyIrresponsible
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6/5/2015 7:12:42 PM
Posted: 1 year ago
At 6/5/2015 6:59:35 PM, Chang29 wrote
Today, Money is not free flowing, it is controlled by a monopolistic quasi unaccountable government institution. Store of value also no longer applies to US currency.

I'll give you one point - it is not entirely free-flowing because of (a) financial frictions and (b) capital controls in countries like China, but other than that this point is really silly. A "store of value" would only be violated insofar as prices were volatile - i.e., a massive, sudden depreciation triggered by a balance of payments crisis - but other than that the dollar does maintain its values.

No institution should have that kind of power, let markets function. When the fed is wrong everyone pays, except government.

And if prices and wages are sticky, so that adjustment takes a long, long time - and in some cases is destabilizing such that "letting markets adjust" only makes things worse - what say you?

Elimination is the best fine tuning. If the piano is broken, tuning a few key is not going to help.

What evidence do you have that it's broken?

Private money, multi-currencies, foreign currencies, there are many ideas, the Fed should not have central planing monopoly power over the American economy.

Can you point to one example where that has been tried and actually succeeded?

If a second or more currencies were legal, the number of variables would increase.

That isn't what you said - you said they're limiting a variable currently. You can add another to the mix - and, mind you, you'd only be rescinding and reducing its power to hit those variables - but this need not mean that it's disregarding a *current* variable. Which are you talking about?

The idea that central planning is needed for monetary policy is the issue, Americans can not opt out of Federal reserve policies. Free market of money and currencies would end the idea of economic enfluence by monetary policy.

They can opt out - they can move out of the US, or engender democratic support for ending the Fed, though (a) they don't know what the Fed is, and learning what it is would require turning off reality television, and (b) that would be a horrible idea, and we know from the 1800s and early 1900s what the country would be like without a central bank: it isn't pretty.
~ResponsiblyIrresponsible

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Chang29
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6/5/2015 10:42:35 PM
Posted: 1 year ago
At 6/5/2015 7:12:42 PM, ResponsiblyIrresponsible wrote:
At 6/5/2015 6:59:35 PM, Chang29 wrote
Today, Money is not free flowing, it is controlled by a monopolistic quasi unaccountable government institution. Store of value also no longer applies to US currency.

I'll give you one point - it is not entirely free-flowing because of (a) financial frictions and (b) capital controls in countries like China, but other than that this point is really silly. A "store of value" would only be violated insofar as prices were volatile - i.e., a massive, sudden depreciation triggered by a balance of payments crisis - but other than that the dollar does maintain its values.

Nothing silly, support for a central planning monopoly like the Fed is totalitarian, nothing else!

American currency does not store value! The Fed states a goal of 2% depreciation per year, or the term used inflation.

Balance of payments crisis are caused by monopolist governmental practices by currency manipulation.


No institution should have that kind of power, let markets function. When the fed is wrong everyone pays, except government.

And if prices and wages are sticky, so that adjustment takes a long, long time - and in some cases is destabilizing such that "letting markets adjust" only makes things worse - what say you?

Prices and wages will adjust, "sticky" is only *sophistry*.


Elimination is the best fine tuning. If the piano is broken, tuning a few key is not going to help.

What evidence do you have that it's broken?

Look at the government's own measures, any object look at an economy that needs 0-.25% target interest rates is clearly broken.

Plus, a system that with a single option that requires violent force to maintain is broken.


Private money, multi-currencies, foreign currencies, there are many ideas, the Fed should not have central planing monopoly power over the American economy.

Can you point to one example where that has been tried and actually succeeded?

Much of 19th century America is a great example, and currently Zimbabwe is getting better by using multi-currencies.


If a second or more currencies were legal, the number of variables would increase.

That isn't what you said - you said they're limiting a variable currently. You can add another to the mix - and, mind you, you'd only be rescinding and reducing its power to hit those variables - but this need not mean that it's disregarding a *current* variable. Which are you talking about?

Without **government force** creating only one currency, the *power* would be greatly reduced.


The idea that central planning is needed for monetary policy is the issue, Americans can not opt out of Federal reserve policies. Free market of money and currencies would end the idea of economic enfluence by monetary policy.

They can opt out - they can move out of the US, or engender democratic support for ending the Fed, though (a) they don't know what the Fed is, and learning what it is would require turning off reality television, and (b) that would be a horrible idea, and we know from the 1800s and early 1900s what the country would be like without a central bank: it isn't pretty.

A person should not be required to leave the land of the free to escape monetary oppression. Have you seen the price tag to turn in an American passport? The Fed has created a currency system that is as bad (as stated by the fear mongers) but in most ways worse, at least decentralized or sound currencies offers options. Anyone that understands the power of free markets to bring the best goods to a person, should be able to understand that a free market of currencies within a country will bring the best currency to a country. A free market that can be trust to provide every possible choice in deodorant can do the same with currency and money.

Central banking was created to *protect the rich* and *increase* governmental power. The Fed is *not* a harmless institution looking out for the good of the below average person.
A free market anti-capitalist

If it can be de-centralized, it will be de-centralized.
ResponsiblyIrresponsible
Posts: 12,398
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6/5/2015 10:56:12 PM
Posted: 1 year ago
At 6/5/2015 10:42:35 PM, Chang29 wrote:

We're doing nothing more than going around in circles - on topics we've already beaten to a pulp. There isn't a single thing we're discussing here that we've already, and I'm not really interested in beating a dead horse even further.
~ResponsiblyIrresponsible

DDO's Economics Messiah
Chang29
Posts: 732
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6/6/2015 6:21:52 PM
Posted: 1 year ago
At 6/5/2015 10:56:12 PM, ResponsiblyIrresponsible wrote:
At 6/5/2015 10:42:35 PM, Chang29 wrote:

We're doing nothing more than going around in circles - on topics we've already beaten to a pulp. There isn't a single thing we're discussing here that we've already, and I'm not really interested in beating a dead horse even further.

I wish the dead horse getting a beating was the Fed.

Central planning at any level, especially at a national level through currency is extremely harmful, central monetary policy must be ended.

Currency and money should not require government force. People need and want money thus a free market will only make money a better product.
A free market anti-capitalist

If it can be de-centralized, it will be de-centralized.
ResponsiblyIrresponsible
Posts: 12,398
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6/6/2015 7:12:50 PM
Posted: 1 year ago
At 6/6/2015 6:21:52 PM, Chang29 wrote:
At 6/5/2015 10:56:12 PM, ResponsiblyIrresponsible wrote:
At 6/5/2015 10:42:35 PM, Chang29 wrote:

We're doing nothing more than going around in circles - on topics we've already beaten to a pulp. There isn't a single thing we're discussing here that we've already, and I'm not really interested in beating a dead horse even further.

I wish the dead horse getting a beating was the Fed.

Lol

Central planning at any level, especially at a national level through currency is extremely harmful, central monetary policy must be ended.

^ This is the dead horse.

Currency and money should not require government force. People need and want money thus a free market will only make money a better product.

This too.
~ResponsiblyIrresponsible

DDO's Economics Messiah
Diqiucun_Cunmin
Posts: 2,710
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6/6/2015 7:37:39 PM
Posted: 1 year ago
At 6/6/2015 6:21:52 PM, Chang29 wrote:
At 6/5/2015 10:56:12 PM, ResponsiblyIrresponsible wrote:
At 6/5/2015 10:42:35 PM, Chang29 wrote:

We're doing nothing more than going around in circles - on topics we've already beaten to a pulp. There isn't a single thing we're discussing here that we've already, and I'm not really interested in beating a dead horse even further.

I wish the dead horse getting a beating was the Fed.
I must say that this was rather funny. :P
The thing is, I hate relativism. I hate relativism more than I hate everything else, excepting, maybe, fibreglass powerboats... What it overlooks, to put it briefly and crudely, is the fixed structure of human nature. - Jerry Fodor

Don't be a stat cynic:
http://www.debate.org...

Response to conservative views on deforestation:
http://www.debate.org...

Topics I'd like to debate (not debating ATM): http://tinyurl.com...
Chang29
Posts: 732
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6/6/2015 7:38:25 PM
Posted: 1 year ago
At 6/6/2015 7:12:50 PM, ResponsiblyIrresponsible wrote:
At 6/6/2015 6:21:52 PM, Chang29 wrote:
At 6/5/2015 10:56:12 PM, ResponsiblyIrresponsible wrote:
At 6/5/2015 10:42:35 PM, Chang29 wrote:

We're doing nothing more than going around in circles - on topics we've already beaten to a pulp. There isn't a single thing we're discussing here that we've already, and I'm not really interested in beating a dead horse even further.

I wish the dead horse getting a beating was the Fed.

Lol

Central planning at any level, especially at a national level through currency is extremely harmful, central monetary policy must be ended.

^ This is the dead horse.

Currency and money should not require government force. People need and want money thus a free market will only make money a better product.

This too.

You have never provided any arguement for a single country wide centrally planned currency. Only, *"the scary pre-Fed days"* which any objective look at pre-Fed days refutes that claim.
A free market anti-capitalist

If it can be de-centralized, it will be de-centralized.
ResponsiblyIrresponsible
Posts: 12,398
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6/6/2015 7:41:04 PM
Posted: 1 year ago
At 6/6/2015 7:38:25 PM, Chang29 wrote:
At 6/6/2015 7:12:50 PM, ResponsiblyIrresponsible wrote:
At 6/6/2015 6:21:52 PM, Chang29 wrote:
At 6/5/2015 10:56:12 PM, ResponsiblyIrresponsible wrote:
At 6/5/2015 10:42:35 PM, Chang29 wrote:

We're doing nothing more than going around in circles - on topics we've already beaten to a pulp. There isn't a single thing we're discussing here that we've already, and I'm not really interested in beating a dead horse even further.

I wish the dead horse getting a beating was the Fed.

Lol

Central planning at any level, especially at a national level through currency is extremely harmful, central monetary policy must be ended.

^ This is the dead horse.

Currency and money should not require government force. People need and want money thus a free market will only make money a better product.

This too.

You have never provided any arguement for a single country wide centrally planned currency. Only, *"the scary pre-Fed days"* which any objective look at pre-Fed days refutes that claim.

That's the crux of the argument - and the fact that, when something isn't broken, you ought not fix it - but I'd love to see this "objective look" at pre-Fed days.
~ResponsiblyIrresponsible

DDO's Economics Messiah
PetersSmith
Posts: 5,816
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6/6/2015 8:01:29 PM
Posted: 1 year ago
At 5/31/2015 3:25:25 PM, ResponsiblyIrresponsible wrote:

Are you like the only one interested in economics on this site?
Empress of DDO (also Poll and Forum "Maintenance" Moderator)

"The two most important days in your life is the day you were born, and the day you find out why."
~Mark Twain

"Wow"
-Doge

"Don't believe everything you read on the internet just because there's a picture with a quote next to it."
~Abraham Lincoln

Guide to the Polls Section: http://www.debate.org...
Chang29
Posts: 732
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6/6/2015 8:05:28 PM
Posted: 1 year ago
At 6/6/2015 7:41:04 PM, ResponsiblyIrresponsible wrote:
At 6/6/2015 7:38:25 PM, Chang29 wrote:
At 6/6/2015 7:12:50 PM, ResponsiblyIrresponsible wrote:
At 6/6/2015 6:21:52 PM, Chang29 wrote:
At 6/5/2015 10:56:12 PM, ResponsiblyIrresponsible wrote:
At 6/5/2015 10:42:35 PM, Chang29 wrote:

We're doing nothing more than going around in circles - on topics we've already beaten to a pulp. There isn't a single thing we're discussing here that we've already, and I'm not really interested in beating a dead horse even further.

I wish the dead horse getting a beating was the Fed.

Lol

Central planning at any level, especially at a national level through currency is extremely harmful, central monetary policy must be ended.

^ This is the dead horse.

Currency and money should not require government force. People need and want money thus a free market will only make money a better product.

This too.

You have never provided any arguement for a single country wide centrally planned currency. Only, *"the scary pre-Fed days"* which any objective look at pre-Fed days refutes that claim.

That's the crux of the argument - and the fact that, when something isn't broken, you ought not fix it - but I'd love to see this "objective look" at pre-Fed days.

The pre-Fed system was not as bad as stated by the statist that require central control. The failures that occurred happened when government stepped in to protect the rich and influential. I am sure you know about Jeykel Island, where the powerful met to draw up plans to protect their wealth using a central banking system.

Ignorance about the current system must be blissful. You study theory on how to use the system, but ignore harmful purpose and affects of this dreadful centrally planned currency system.

As stated earlier, any economy that requires target interest rates to be near zero for any amount of time is clearly broken, then adding 3 rounds of QE with most likely another coming, America's monetary system is broken. This broken system is working as designed, to protect the rich and maintain governmental power, by keeping people feeling helpless in front of the TV.
A free market anti-capitalist

If it can be de-centralized, it will be de-centralized.
Diqiucun_Cunmin
Posts: 2,710
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6/6/2015 8:06:20 PM
Posted: 1 year ago
At 6/6/2015 8:01:29 PM, PetersSmith wrote:
At 5/31/2015 3:25:25 PM, ResponsiblyIrresponsible wrote:

Are you like the only one interested in economics on this site?

16kadams.
The thing is, I hate relativism. I hate relativism more than I hate everything else, excepting, maybe, fibreglass powerboats... What it overlooks, to put it briefly and crudely, is the fixed structure of human nature. - Jerry Fodor

Don't be a stat cynic:
http://www.debate.org...

Response to conservative views on deforestation:
http://www.debate.org...

Topics I'd like to debate (not debating ATM): http://tinyurl.com...
ResponsiblyIrresponsible
Posts: 12,398
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6/6/2015 8:08:05 PM
Posted: 1 year ago
At 6/6/2015 8:01:29 PM, PetersSmith wrote:
At 5/31/2015 3:25:25 PM, ResponsiblyIrresponsible wrote:

Are you like the only one interested in economics on this site?

There are a few more, though I've probably had more formal training than most people.
~ResponsiblyIrresponsible

DDO's Economics Messiah
PetersSmith
Posts: 5,816
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6/6/2015 8:09:39 PM
Posted: 1 year ago
At 6/6/2015 8:08:05 PM, ResponsiblyIrresponsible wrote:
At 6/6/2015 8:01:29 PM, PetersSmith wrote:
At 5/31/2015 3:25:25 PM, ResponsiblyIrresponsible wrote:

Are you like the only one interested in economics on this site?

There are a few more, though I've probably had more formal training than most people.

If you are so experienced in economics why haven't you realized the glory of National Socialism?
Empress of DDO (also Poll and Forum "Maintenance" Moderator)

"The two most important days in your life is the day you were born, and the day you find out why."
~Mark Twain

"Wow"
-Doge

"Don't believe everything you read on the internet just because there's a picture with a quote next to it."
~Abraham Lincoln

Guide to the Polls Section: http://www.debate.org...
ResponsiblyIrresponsible
Posts: 12,398
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6/6/2015 8:10:03 PM
Posted: 1 year ago
At 6/6/2015 8:05:28 PM, Chang29 wrote:

I really, really wish we could do this elsewhere - again, it's 100% off-topic and redundant. I've heard all of this before. If you have any evidence you'd like me to examine defending the claim that the pre-Fed days - which were, by all account, boom-bust central - actually weren't that bad, I'd love to examine it. Further, if you have any evidence of a society without a central bank, I'm willing to look at it. Otherwise, this is just aimless ranting.
~ResponsiblyIrresponsible

DDO's Economics Messiah