Collapse of U.S. Economy Imminent?

Originally posted by Number23
I'm not going to go to the trouble of quoting all of Stellar's nonsense and Marxist blather. So let's look at some actual data. (I know, an unusual thing around here)

Marxist blather? The people who never respond to my points are very rarely those who in the end seems to know more than me so thanks for admitting as much from the start!

The federal budget estimate for the fiscal year just completed dropped to $250 billion, congressional estimators said Friday, as the economy continues to fuel impressive tax revenues.

What part of the economy would this be?

The Congressional Budget Office's latest estimate is $10 billion below CBO predictions issued in August and well below a July White House prediction of $296 billion.

Predictions are really powerful when it comes to money matters.

The improving deficit picture _ Bush predicted a $423 billion deficit in his February budget _ has been driven by better-than-expected tax receipts, especially from corporate profits, CBO said.

www.breitbart.com...

A lower deficit number is great but where is the evidence that it came from corporate profits and if they did where did those corporate profits come from?Is it not a well known fact that the tax burden in America falls squarely on the average wage earner and that coporations contribute somewhere between 7 and 10%.The full picture is not being presented here and their still spending far more than they have so what exactly is the nature of the excitement beside trying to distract us?

There is an editorial in today's Wall St. Journal about the "tax tidal wave" due to Bush's tax cuts. Thanks to said tax cuts and pro-growth policies, the America's economy has growth more thant TWENTY PERCENT in the last four years.

GDP growth and living standards are not very much related as American living standards are still declining.... GDP growth fueled by federal deficit spending is not only criminal but a simplistic ploy to fool ignorant voters.

That's TWO TRILLION DOLLARS equal to China's GDP. That's right, in the last for years America's grown a Chinese economy.

And the fact that your willing to consider the two things related completely exposes your ignorance. The American federal deficit has increased by almost the same amount as the GDP so it's pretty obvious who's paying for the 'growing' GDP which average Americans obviously do not see reaching their pockets

Additionally, the deficit is running at less than 2% of GDP. Can anyone name another industrial economy who's deficit is 2% or less? AND America's debt burden is less than EU zone and just about every other industrial economy.

How do you come up with this nonsense? What does it matter if other industrialized nations also have high deficit spending when in American such deficit spending goes almost exclusively to military spending and lining the pockets of corporations? I'm sorry but your looking at everything that seems even remotely good and then promptly forget how much information you avoided to reach the happy conclusion. How many other industrial nations have such high deficits and less civil infrastructure than the USA?

Stellar

Originally posted by Number23
Fiat money is a very unintuitive and complex notion and I won't attempt to go into details here.

Well it need not be very complex if you stick to some basic principles such as the fact that fiat money is essentially based on the premise of trust.... Do we trust our central banks that are on the whole controlled by foreigners?

There's been plenty written on the subject by people far smarter than I. Your post indicates a rather unsophisticated understating of the subject and would encourage you to do some research.

I would agree and my advice is go back to the books are start telling what you must know if you studied this topic as well as you say you have.

The premise that gold standard = good and fiat money = bad is simplistic and wrong.

Both can be exploited equally well if one's intent is manipulation so this i can agree with.

If one is to grow an economy, a growing money supply is required. This is difficult to accomplish without fiat money and absent growth in the money supply, deflation results.

The money supply should always be sufficient so that the exchange of goods is never restricted by a lack of liquidity. If there is no money to pay wages with 'stuff' can not be produced and if there is nothing being produced and no one to buy it economies stagnate or decline. Deflation needs not be a huge problem for the average consumer as long as the money supply does not become so restricted that the currency units becomes too large to serve as exchange method. Deflation gets a bad name because it's essentially a tax on borrowers and since it's big business who is most exposed and loves borrowing they do not like it AT ALL.

Most serious economist consider species money an significant contributer to the global economic crash of the 1930s

Banks basically called in their loans and extended few thus creating massive liquidity problems ( scarcity of money) resulting in industry not being able to hire or pay workers and thus a decline in buying power and demand for goods. If left alone this spiral can endlessly reinforce itself till the money supply once again increases to level where there is enough liquidity in the economy to start hiring workers thus creating demand for goods by increasing buying power.

Any time you establish rules to govern a system, winners and losers will result.

Only if that is the general intent..... Systems where everyone benefits is not hard to imagine or even implement...

Fiat and species money both have their own set of winners and losers. It's just the ratio of winners to losers if far more favorable for fiat money.

Well it can be but it's also far easier to manipulate fiat money as there needs be no vaults to keep the gold/precious metals in. Since fiat money is essentially numbers in a database there need be no vaults and it can simply be made to disappear so that the life energy expended to create what the fiat money made possible can be repossess by those who did not a days worth of honest work.

Stellar

The US economy IS in danger, DEPENDING!!! on WHICH SIDE YOUR ON. If your rich, the economy is going to be superb, if your poor, your going to get lynched. The economy is shifting away from the USA in some ways, which is understandable when you think about how a tyrant keeps power: keep the people poor so they wont have the money to fight. The economy as I stated is good or bad based on where you stand, and it will remain like this untill a major change happens.