Day 106 - Inflation, Stupidity on the Rise

Status: Thinking. Hi, yes, I'm still here, though I've been busy recently, and overwhelmed at the speed with which the Obama Administration has been moving. Unfortunately, the Stimulus (read "Spending") Bill has been passed. [Read/search the bill here]

Apparently, I like getting into political fights on the internet as well, because recently I got into another one. This one was on the aforementioned bill. The thread's title was "Do you believe the Stimulus bill was really bipartisan? I don't.". This lead to a discussion where I got involved. The following transcript occurred: [Thread Viewable Here]

I (tustin2121) said:

Politics! Gah! I don't want to get involved, but....

No, the bill isn't bipartisan, but the Dems WANT it to be bipartisan so that when it fails, they can blame Republicans. (Note: not "if" it fails, but when, because spending several billion dollars will, if already hasn't, cause major inflation, which is BAD for the economy. If there were tax cuts in there, there won't be when they're done with it. And I know they're gonna try and slip in a few things that Republicans should hate too.)

Person A said:

tustin2121:

Politics! Gah! I don't want to get involved, but....

cause major inflation, which is BAD for the economy. If there were tax cuts in there, there won't be when they're done with it. And I know they're gonna try and slip in a few things that Republicans should hate too.)

Step outside sir.

You *Punches tustin* will not *backhand* talk utter *knees Tustin in the face* crap in economic *crushes Tustin's nose* terms *final punch* again.

As you can see, economic ignorance is something that makes me deeply angry.

I responded:

Excuse me?! Economic Crap?! What makes me economically ignorant? PLEASE point out my flaws instead of simply beating me up! This isn't a counter argument, it's violence (albeit fake violence, but you get the point).

Also, if you're going to quote me, quote my entire statement, thank you. You seemed to have left out a vital part of my argument...

Person B responded:

Indeed he did. He's right though.
tustin2121:

because spending several billion dollars will, if already hasn't, cause major inflation

This is wrong.

I respond:

No it isn't. Listen: money only has a certain value if a) it is backed by something of real value (eg Gold) or b) it is limited in quantity in proportion to all the goods in the market. Money by itself does not have any value; the paper bill has no intrinsic value, and most coins now a days are made of worthless pot-metal.

If there's more money in the system then there is value, then the value per money unit (eg. the dollar) drops (simple division here). When the value per dollar drops, people have to pay more dollars to get the same valued item, which is "rising prices", which is "inflation".

MMO designers and managers know this, because they use the same concept in games that have an economy. If there the value of their currency starts to fall, they'll create "gold sinks", which in the games usually are NPC shop owners and the like. When a player pays for something from the gold sink, the gold is taken from the player and taken out of the economy, which keeps the value of the gold from dropping.

Creating a money sink in real life is much much harder, because only the Federal Reserve, and by extension the Government, has the ability (or rather, the interest) to take money out of the system; everyone else wants and needs to use the money.

Therefore, generating money out of nowhere, like the stimulus bill proposes, will flood the market with representations of value (money) when no real value is being produced, and will cause hyper-inflation. QED.

Person B replies:

tustin2121:

Therefore, generating money out of nowhere, like the stimulus bill proposes, will flood the market with representations of value (money) when no real value is being produced, and will cause hyper-inflation. QED.

Oh, I won't argue about a bill I don't know anything about, but your initial post said:
tustin2121:

because spending several billion dollars will, if already hasn't, cause major inflation

and that is plain wrong. Investments can be the way to counteract inflation. I won't argue your poins on the specific bill, 'cause I can't be bothered to research it. But what you wrote there, was very wrong.

As for
tustin2121:

No it isn't. Listen: money only has a certain value if a) it is backed by something of real value (eg Gold) or b) it is limited in quantity in proportion to all the goods in the market. Money by itself does not have any value; the paper bill has no intrinsic value, and most coins now a days are made of worthless pot-metal.

That is wrong too. The world eceonomy runs on one central things today: optimism. I'm not BS'ing here.

I replied:

How can one statement be wrong and the other right when both are saying the same thing? Are we talking in double speak now? In order to spend the 700+ billion dollars, someone has to generate it first. Simply making the money does nothing if it doesn't get spent into the economy. Therefore, they go hand in hand when it comes to this.

[And] Yes, the economy does run on optimism, or as I like to call it, a promise; the promise was that this dollar has value. We run on this optimism because we scrapped the "backed by gold" in the 20's-30's, and we are now scrapping the "proportional value" with this bill. We are breaking the promise that we wouldn't make more representations of value than there is value by making billions of representations of value without making new value (or making very little of it).

Of course, more is to come, but I do think that people are getting slowly dumber as time goes on. This isn't rocket science, and I sure hope I explained the non-rocket-science to them well enough...

End Log.

Tuttle Cam - Tuttle's Economic Stimulus package

This is contributor James Tuttle. Once again, spread this video like Obama spreads the wealth.

Go to the blog or Go to the video

Louisiana governor Bobby Jindal rocks.  Here's why.  Other states are asking for a bailout.  The voters in those states need to learn how to vote.

Tuttle Cam - Obama's Economic Stimulus

This is contributor James Tuttle.

Go to the blog or Go to the video


Please spread this video around. I'm making these videos to go viral as a form of grassroots action. It's a simple way to help the Conservative Underground.

Day 6

Status: Afraid. I fear for the future, obviously. But what I fear most is what will happen to me. I have never been the POW kind - the kind that John McCain is. If I were ever tortured, or deprived, I would crack faster than Winston in the face of a mask of Rats. I fear what speaking out might do. But what I fear most is the Draft. I support our troops, but I never could be one. And Obama will reinstate the draft. He will offer it, or his "civilian defense force". I can't fight. Nor could I join the ranks of the brown shirt army... Must stay strong...

Obama is not even president yet, and already the world loves us again and he is being compared to Kennedy and "the great presidents of the past". Also, apparently there is now an Office of the President-elect...

Cabinet News:
Google CEO says 'no thanks' to Obama cabinet position
Now what would a Director of Technology do? Would censoring the internet be appealing to one taking the job?
Obama Appoints Fairness Doctrine Backer
If anyone doubted this... and what's worse: the FCC bypasses Congress in making "regulations", so calling your congressmen doesn't help...
Granholm pleads for auto aid, avoids Obama cabinet question
Obama has appointed to the economic transition team the governor of Michigan. Note that is it Michigan that has everything Democrats think makes a good economy, and people are leaving in droves.

Finally, the head of the office of the President-Elect has stated what he thinks of the Constitution. There are several movements now to change it, and there is no doubt, given his statements, that he wishes to change it. What I love about this source is that the purpose of it is to quell conservative attacks. Excuse me while I jump around happily for a moment. [Source: http://www.youtube.com/watch?v=jOinedzuoh4]

INTERVIEWER: Barack Obama, what are your thoughts on the Declaration or Constitution?
BARACK: You know, I think it's a remarkable document... uh, I think, uh...
INTERVIEWER: Which one?
BARACK: The original constitution...uh...as well, as well as the Civil War amendments, but I think it is an imperfect document, and I think it is a document that reflects... uh... some deep flaws... uh... in... uh... American Culture... the colonial culture [prevalent] at that time. African Americans were not...uh... (first of all they weren't African Americans). The Africans at the time, uh, were not considered, uh, as part of the polity that was... uh... of concern... uh, to the framers. I think that, as Richard said, it was a nagging problem... uh, in the same way that these days we might think of environmental issues or some other problem where you have to balance... uh... you know, cost benefits, as opposed to seeing it as a moral problem involving... uh uh... persons... uh uh uh of moral worth. And in that sense I think we can say that... uh uh, the constitution reflected a enormous blind spot in this culture that carries on until this day and, and uh, and that the framers, uh, had that same blind spot. I-I-I don't think that two views are contradictory to say that it was a remarkable political document... uh, that paved the way for where we are now and to say that... uh... it also... uh... reflected the fundamental flaw of this country that continues to this day.
INTERVIEWER CONTINUES.

I hate to break it to you, Mr. Obama, but given the "but" you had at the beginning of your speech there (underlined above) you were bullshitting us about thinking it is a "remarkable document". Not only that, but you have completely forgotten about two important issues concerning the racism (cleverly not called directly so) you see in the Constitution:

1. As you unwillingly point out in the beginning, your qualms lie with the "original" Constitution, before the Civil War broke out. Stop living in the past, Mr. Obama: The Civil War and the (conveniently forgotten) civil rights movement have changed the Constitution to rid it of any "racism".
2. Obama conveniently forgot that the framers to the constitution were at odds over how slavery should be represented. The northern states wanted black people and slaves counted as whole people, while the southern democrats did not. They settled with the three-fifths rule, which, restating point 1, was repealed with the 14th Amendment, ratified during Civil War Reconstruction.

So, Obama, what is the fundamental flaw of the Constitution if "racism" has been removed from it? He will change the Constitution, and it will be for the worse. So help us God.

End Log.