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Federal reserve debunkers I need alittle help

Abbyas said:
What? So there would be no loans, no credit cards from these banks? Do you know what the cost of a loan would be then? You think people can't hold on to their houses now? No one, except the very very rich, would have one. And no one but the very rich would have college educations or businesses. Your system would lead to a system of elite-rule one hundred times than the one we have now. Edited to add: Also, how would you propose banks make money off of checking and savings accounts? Not only would loan costs rise, savings rates would plummet. In fact, banks wouldn't accept savings accounts at all. Why would they?
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Why do you presume there would be no loans? Banks would be free to loan paid in capital, and time deposits. The costs of loans would be realistic, not unrealistic, as is the case with artificially low inflation-subsidized interest rates. Your assumption that only the very rich would be able to either own homes, or finance them, is wrong. In fact, it is the excesses of fiat monetary policy and fractional reserve banking which result in asset bubbles like the current real estate bubble. It is precisely because of the Fed that people are priced out of new homes, and are mired in mortgage and other debt.

Think about the situation we're in now at the moment. Unscrupulous lenders were awash in cheap money, and so lending standards and risk assessment were completely thrown out the window in the name of greed. Then all of these bad mortgages were repackaged and sold to the public investor. We've yet to reap the seeds of this, although the Fed has been very busy creating money and using it to bail out Wall Street banks with CDO exposure lately. I guess the people getting foreclosed upon aren't so lucky.

Are you admitting with your post that we have elites ruling us? Or just a few elites, compared to the many we would have with sound money? It seems to me that being in a partial plutocracy is like being partially pregnant, or partially certain.

Banks would still be able to make money in most of the ways they make money now, ie: the spread on their loan portfolio and their time deposits, and fees and other bank services. Sound money is not an impediment to bank profits, but a natural arbiter of risk.

You are completely ignoring the velocity of money. If the supply of money were fixed, inflation would be rampant. It would have to be. Inflation is also resultant of how are GDP grows in relation to the natural GDP given our resources. With a fixed money supply, inflation would grow with absolutely each increase in GDP. AD/AS curve mean anything to you?
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The velocity of money is a non-factor with regard to measuring long term inflation, because it remains stable over the long run. In the short run, velocity is affected by people's expectations of inflation or deflation. While velocity is a factor affecting short term prices, the actual supply of money plays a much larger role. Velocity is also accounted for in the quantity theory of money.

As far as your claim that a fixed money supply will necessarily result in price inflation, that's the most ignorant statement you've made thus far. In fact, the exact opposite is true. One of the biggest rationalizations for a managed money supply and the Federal Reserve is to prevent ostensible deflation, not inflation. As productivity increases and economic growth bring more goods to a market with a constant money supply, prices must fall, reflecting what should be obvious - more goods chasing the same amount of money results in falling prices. Whether you call this deflation, disinflation, or the "productivity norm" mostly depends on your point of view. Monetarists like me would say that slightly falling prices over time is a natural and good thing. Keynesians would argue that stimulating demand by any means necessary is paramount, which is an argument for deficit spending and the monetization of debt, each of which is financed by creating money out of nothing. The problem is of course that the money creation business, specifically, who gets to use the money first, is entirely arbitrary and unfair, and results in wealth condensation (the elite class that you referred to previously).

How would you have the market determine what money is? Would you be comfortable returning to a barter system? Also, the idea that you don't care what the govt accepts in taxes (sales tax, too?) is very telling. What tends to happen in societies is that the form of money that the govt accepts becomes the form that businesses and individuals will accept.
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How would I have the market determine what money is? That question is paradoxical. If I or someone else determines what it is, then it isn't the market. No, I would not be comfortable returning to a barter system, nor would that be a consequence of sound money. You are correct in your assessment that legal tender law and tax policy form the basis for monetary demand, I totally agree. Which is why the fact that Congress in its creation of the Federal Reserve System has unconstitutionally delegated control over our money to private bankers, and placed us in the predicament that we're in now.
 
Tippit, So I see your system of 100% reserve would force the banks to operate off of fees and Certificates of Deposit. Forcing people to accept CD's as the only real way to have any sort of savings account, since no bank in their right mind would store my money for free, would kill off any liquidity to the individuals. So any means of saving money would mean that I would have to part with that money for a certain amount of time, what if I am in no position to do that? I am out of luck since all of my liquid savings vehicles have been eliminated by law.

Also where is the Federal reserve unconstitutional? It was voted on in congress, signed by the president and never struck down by any court.
 
Texas said:
Damn we are light years apart in politics but that was one hell of a post. KUDOS
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Well, thank you!

I think we are likely closer in philosophy on matters of public policy than you imagine. It does not sit well with my bothers on the Left, and hence why they accuse me of being a "gatekeeper."

I want regulation of corporations, and to eliminate their legal personhood as my most radical stance.

And second to that I want to see an institution like Chicago's Cook Country hospital in every congressional district in the land; A place the poorest can go and get decent medical care even if that means waiting in lines for it. As decent people it is the least we can do.

Finally I don't think the federal government should be allowed to go into debt greater than the previous two year's tax proceeds. Something modern "Conservatives" seem to think is anathema. Probably because it would mean that we'd have to move taxation rates back to where they were in the late 1960s.

-Ben
 
Why do you presume there would be no loans? Banks would be free to loan paid in capital, and time deposits. The costs of loans would be realistic, not unrealistic, as is the case with artificially low inflation-subsidized interest rates. Your assumption that only the very rich would be able to either own homes, or finance them, is wrong. In fact, it is the excesses of fiat monetary policy and fractional reserve banking which result in asset bubbles like the current real estate bubble. It is precisely because of the Fed that people are priced out of new homes, and are mired in mortgage and other debt.
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And exactly as someone else said, there would be absolutely no savings accounts. None. They would not be offered. People would be forced to tie their savings to CD's or more unstable stocks. What portion of loans from banks come from time deposits and what come from savings accounts?

And, yes, the mortgage crisis has come from unscrupulous lending practices and unscrupulous home appraisals. To suggest that it comes from fractional reserve ratios and then to say to get rid of them is to say that there's something wrong with the housing loan system so lets get rid of all loans.

The velocity of money is a non-factor with regard to measuring long term inflation, because it remains stable over the long run.
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That is an incorrect assumption, number one... and if you're going with the monetarist equation here that V=nominalGDP/Moneysupply... then if you keep the money supply fixed and increase nominal GDP, how in the world would you keep the velocity constant?

As far as your claim that a fixed money supply will necessarily result in price inflation, that's the most ignorant statement you've made thus far.
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What? Are you suggesting that the only reason inflation exists is because of a change in the money supply? Are you suggesting that before governments intervened in a change of money supply, there was no inflation? You are completely ignoring the role an increase in GDP has in such a thing.

As productivity increases and economic growth bring more goods to a market with a constant money supply, prices must fall,
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And this is your most ignorant statement. No, since, you are unfamiliar with the AS/AD curve, let me put it in its most basic form: As productivity increases, unemployment goes down... as unemployment goes down, the labor supply demands higher wages...(and if you think that's bogus, try looking at unions around this time) if workers demand higher wages, the price of goods must go up. This is also exactly why inflation in markets with high ratio of labor (colleges, medical, the humanites) is much greater than inflation in other markets (manufacturing, computers, etc, etc). To say that a higher GDP doesn't lead to higher inflation is ridiculous.

You are correct in your assessment that legal tender law and tax policy form the basis for monetary demand, I totally agree.
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Again, so you would have the government take sales taxes from businesses in the form of gold? I'm not talking about the "worth" of money here, I'm talking about it's form. Which the market alone cannot determine.

Which is why the fact that Congress in its creation of the Federal Reserve System has unconstitutionally delegated control over our money to private bankers, and placed us in the predicament that we're in now.
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Would you have Congress control the money supply???? Would you have them give a short boost to the economy during an election year?

Also, do you know how much of a voice private banks have in the Fed? Not a very big one... Have you even looked into the structure of the voting in the Fed?
 
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Abbyas said:
And exactly as someone else said, there would be absolutely no savings accounts. None. They would not be offered. People would be forced to tie their savings to CD's or more unstable stocks. What portion of loans from banks come from time deposits and what come from savings accounts?
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Savings accounts would be offered, you might have to pay the bank to store your money, just like you pay public storage to store your furniture. I see nothing wrong with this, especially when the alternative is an inherently unstable fractional reserve system, based on the logical contradiction that money can exist in two places at once, and insured by a never ending supply of fiat money provided by a "lender of last resort".

And, yes, the mortgage crisis has come from unscrupulous lending practices and unscrupulous home appraisals. To suggest that it comes from fractional reserve ratios and then to say to get rid of them is to say that there's something wrong with the housing loan system so lets get rid of all loans.
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It didn't just come from unscrupulous lenders. Greedy would-be lenders with no money to lend are not lenders. The money had to come from somewhere, and that place is the Federal Reserve System. You seem to be conflating two different issues here, namely fractional reserve systems and fiat monetary regimes. The housing crisis is mostly a function of the latter. The rampant stock speculation that occurred in the roaring twenties didn't happen in a vacuum, it happened in the context of a Federal Reserve System that was printing money like it was going out of style. Do you accept this truth and do you understand how fiat money and artificially low interest rates create malinvestment and skew risk?

That is an incorrect assumption, number one... and if you're going with the monetarist equation here that V=nominalGDP/Moneysupply... then if you keep the money supply fixed and increase nominal GDP, how in the world would you keep the velocity constant?
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I didn't say velocity is constant, I said it's more or less stable. The flaw in your reasoning is that you assume the turnover rate of money is more variable than M, the actual supply of money. Price inflation is a monetary phenomenon (prices are after all, defined in terms of money, right?), and since the tendency of fiat money regimes is to constantly inflate the money supply, we have corresponding price inflation to the extent it is not offset by productivity growth.

Even when money supply growth merely matches output, it still represents an arbitrary and unfair transfer of wealth from value producers (accepters of money) to money producers (creators of monetary tokens).

What? Are you suggesting that the only reason inflation exists is because of a change in the money supply? Are you suggesting that before governments intervened in a change of money supply, there was no inflation? You are completely ignoring the role an increase in GDP has in such a thing.
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No, what I've maintained is that price inflation is primarily a monetary phenomenon, but not always. Exogenic supply shocks like war, drought, and similar phenomena that serve to reduce economic output can have inflationary effects - moreover, artificial attempts by central banks to curtail this form of inflation by raising interest rates or otherwise tightening credit are disastrous.

And this is your most ignorant statement. No, since, you are unfamiliar with the AS/AD curve, let me put it in its most basic form: As productivity increases, unemployment goes down... as unemployment goes down, the labor supply demands higher wages...(and if you think that's bogus, try looking at unions around this time) if workers demand higher wages, the price of goods must go up. This is also exactly why inflation in markets with high ratio of labor (colleges, medical, the humanites) is much greater than inflation in other markets (manufacturing, computers, etc, etc). To say that a higher GDP doesn't lead to higher inflation is ridiculous.
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Ah, so the real culprits of price inflation are *drum roll please* those greedy wage earners! Forgive me if I'm disappointed that someone of your intelligence actually buys this tripe. First of all, the emphasis on aggregate demand and thus the demand curve are Keynesian principles, which I've already dismissed. Keynesian economics is a vain attempt to justify fascist policies of wealth confiscation. It was Keynes himself who wrote:

"Lenin is said to have declared that the best way to destroy the capitalist system was to debauch the currency. By a continuing process of inflation, government can confiscate, secretly and unobserved, an important part of the wealth of their citizens."

-John Maynard Keynes
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Wage earners cannot be the culprits behind inflation, because absent an increase in M, all wage increases must be offset dollar for dollar by decreases in another economic class or sector. To blame inflation on rising wages is to literally mistake effect for cause. If you really believe this garbage, then what role do you think the supply of money actually plays with regard to the general price level, if any?

I understand coming to grips with the idea that your $150,000 education was worth substantially less than that is painful, but lets not let that distort the truth, shall we?

Again, so you would have the government take sales taxes from businesses in the form of gold? I'm not talking about the "worth" of money here, I'm talking about it's form. Which the market alone cannot determine.
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The Constitution authorizes gold and silver coin as money. I favor letting the market determine what our money is. I'm confident that the market will choose what it has chosen throughout history.

Would you have Congress control the money supply???? Would you have them give a short boost to the economy during an election year?

Also, do you know how much of a voice private banks have in the Fed? Not a very big one... Have you even looked into the structure of the voting in the Fed?
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I would prefer Congress obeyed the US Constitution with respect to the crucially important issue of what serves as money. In the absence of a law-abiding Congress, the lesser of evils would be to have a monetary system for which monetary growth is limited in statute. The idea that the control of money shouldn't be a political issue and thus be left in the hands of bankers is dangerous.

Yes, I'm well aware of how opaque the Fed is, and how unaccountable it is to Congress, and the inordinate power held by the NY Fed.
 
jezcoe said:
Tippit, So I see your system of 100% reserve would force the banks to operate off of fees and Certificates of Deposit. Forcing people to accept CD's as the only real way to have any sort of savings account, since no bank in their right mind would store my money for free, would kill off any liquidity to the individuals. So any means of saving money would mean that I would have to part with that money for a certain amount of time, what if I am in no position to do that? I am out of luck since all of my liquid savings vehicles have been eliminated by law.

Also where is the Federal reserve unconstitutional? It was voted on in congress, signed by the president and never struck down by any court.
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While the idea that you may have to pay banks to warehouse your money might be unappealing, the gains both in terms of economic and political stability, as well as a newfound stability in the purchasing power of your dollar would more than offset this.

The Fed is unconstitutional because of section 8 which states:

Section. 8. The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;

To borrow Money on the credit of the United States;

To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes;

To establish an uniform Rule of Naturalization, and uniform Laws on the subject of Bankruptcies throughout the United States;

To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures;

To provide for the Punishment of counterfeiting the Securities and current Coin of the United States;

To establish Post Offices and post Roads;

To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;

To constitute Tribunals inferior to the supreme Court;

To define and punish Piracies and Felonies committed on the high Seas, and Offences against the Law of Nations;

To declare War, grant Letters of Marque and Reprisal, and make Rules concerning Captures on Land and Water;

To raise and support Armies, but no Appropriation of Money to that Use shall be for a longer Term than two Years;

To provide and maintain a Navy;

To make Rules for the Government and Regulation of the land and naval Forces;

To provide for calling forth the Militia to execute the Laws of the Union, suppress Insurrections and repel Invasions;

To provide for organizing, arming, and disciplining, the Militia, and for governing such Part of them as may be employed in the Service of the United States, reserving to the States respectively, the Appointment of the Officers, and the Authority of training the Militia according to the discipline prescribed by Congress;

To exercise exclusive Legislation in all Cases whatsoever, over such District (not exceeding ten Miles square) as may, by Cession of particular States, and the Acceptance of Congress, become the Seat of the Government of the United States, and to exercise like Authority over all Places purchased by the Consent of the Legislature of the State in which the Same shall be, for the Erection of Forts, Magazines, Arsenals, dock-Yards, and other needful Buildings; — And

To make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof.
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The word "coin" has a specific meaning:

coin (koin)

tr.v. coined, coin·ing, coins
1. To make (pieces of money) from metal; mint or strike: coined silver dollars.
2. To make pieces of money from (metal): coin gold.
3. To devise (a new word or phrase).
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This excludes both printing money, and creating electronic money, as well as delegating such responsibilities to entities outside of Congress.

The Fed is unconstitutional because of section 10 which states:

Section 10 - Powers prohibited of States

No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.

No State shall, without the Consent of the Congress, lay any Imposts or Duties on Imports or Exports, except what may be absolutely necessary for executing it's inspection Laws: and the net Produce of all Duties and Imposts, laid by any State on Imports or Exports, shall be for the Use of the Treasury of the United States; and all such Laws shall be subject to the Revision and Controul of the Congress.

No State shall, without the Consent of Congress, lay any duty of Tonnage, keep Troops, or Ships of War in time of Peace, enter into any Agreement or Compact with another State, or with a foreign Power, or engage in War, unless actually invaded, or in such imminent Danger as will not admit of delay.
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Why section 8 doesn't make explicit reference to gold and silver as section 10 does is a mystery to me, nevertheless the meaning of the word "coin" is clear.

Pedants will immediately point out that section 10 reflects a limitation on states, and not necessarily the Federal Government. However, clearly the spirit of the law is against fiat money, and clearly the Federal Government has no authority to delegate control of our money to a quasi-private institution like the Federal Reserve. The type of dishonesty to claim otherwise is exactly the sort of dishonesty required to subvert the spirit of the Constitution at any other level. On the other hand, I would be the first to argue that the Constitution is has not sufficiently addressed the crucial issue of who controls our money, and for that it needs to be amended.
 
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Tippit said:
Savings accounts would be offered, you might have to pay the bank to store your money, just like you pay public storage to store your furniture. I see nothing wrong with this, especially when the alternative is an inherently unstable fractional reserve system, based on the logical contradiction that money can exist in two places at once, and insured by a never ending supply of fiat money provided by a "lender of last resort".
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Why would a bank offer a liquid savings account if it is by your law required to keep on hand 100% of all cash on hand? They would not be able lend out the money for interest and therefore would not give me any cut of that interest. Obversely why would I put my money in a bank if they made me pay to put it there? I cannot use my money to make money and still keep it liquid under your plan.

It didn't just come from unscrupulous lenders. Greedy would-be lenders with no money to lend are not lenders. The money had to come from somewhere, and that place is the Federal Reserve System. You seem to be conflating two different issues here, namely fractional reserve systems and fiat monetary regimes. The housing crisis is mostly a function of the latter. The rampant stock speculation that occurred in the roaring twenties didn't happen in a vacuum, it happened in the context of a Federal Reserve System that was printing money like it was going out of style. Do you accept this truth and do you understand how fiat money and artificially low interest rates create malinvestment and skew risk?
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The Great depression was a perfect storm of bad monetary policy, reduction in international trade (after WWI), bad tariff law, bad weather, the gold standard... such a coming together of crappy situations and simple human stupidity. You can control some factors but you cannot control stupidity. I think that it is fine to criticize the job the the Fed is doing. I think that they should let the pain be quick and over with instead of prolonging it and hoping the banks will borrow their way out of it. I also don't like that the Gov't is going to bail out the idiots who made the bad investments. But do I think we should get rid of fractional reserve banking? I think that that is a little extreme.

The Constitution authorizes gold and silver coin as money. I favor letting the market determine what our money is. I'm confident that the market will choose what it has chosen throughout history.
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Sorry it isn't.
Article I, Sec 10
"Section 10. No state shall enter into any treaty, alliance, or confederation; grant letters of marque and reprisal; coin money; emit bills of credit; make anything but gold and silver coin a tender in payment of debts; pass any bill of attainder, ex post facto law, or law impairing the obligation of contracts, or grant any title of nobility."

The only mention of gold and silver in the Constitution is on the limits of the power of the states.

The Congress is charged with in Article I Sec 8 "To coin money, regulate the value thereof, and of foreign coin, and fix the standard of weights and measures;" but it says nothing of Gold and Silver.

The States of course can use Federal money instead of Gold and Silver.


I would prefer Congress obeyed the US Constitution with respect to the crucially important issue of what serves as money. In the absence of a law-abiding Congress, the lesser of evils would be to have a monetary system for which monetary growth is limited in statute. The idea that the control of money shouldn't be a political issue and thus be left in the hands of bankers is dangerous.
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I wish the Congress and the President would obey the constitution when it comes to keeping my privacy rights. We all want different things from our government. If you argue a gold standard from a constitutional stance though you first need to check if it is there.

I would also not trust Congress in the least bit to control the money supply. In the hands of bankers who by law have to give up profits after operations are paid for to the Treasury (around 90% of what they make), have to report to congress, and make their business open to the public (http://federalreserve.gov/boarddocs/rptcongress/)

In an imperfect world, it isn't the worst solution.
 
More lies from the lying liar, I see.

Tippit said:
However, clearly the spirit of the law is against fiat money, and clearly the Federal Government has no authority to delegate control of our money to a quasi-private institution like the Federal Reserve.
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Wrong. You may very well feel that way, but the SCOTUS has maintained consistently precisely the opposite. When you build your own sandbox you can reinterpret things however you want in your personal sandbox.

Tippit said:
The type of dishonesty to claim otherwise is exactly the sort of dishonesty required to subvert the spirit of the Constitution at any other level.
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The only dishonest we're seeing here is your own. You lie about the origins of federal banking, you lie about how the Fed actually works, you lie about who controls the Fed, you lie about a bunch of other things, and to put the cherry on top you expect everyone to interpret the Constitution how you want to interpret it, instead of how the Judiciary has interpreted it for nearly a century (or two, if you want to go back further than 1913).

You see, Tippit, I tend to be of the opinion that arguments about the efficacy of our current system have a place in public discourse. From what I have learned of economic systems, none of them are the "best" systems, but nations use the "best we have right now" methodology in practice because here in the Real World there isn't time to build a whole hypothetical fantasy world that assumes everyone is going to behave exactly how you think they will behave. All your "the market will adjust" stuff is all built on this house-of-cards premise, because you don't even attempt to address instances where "the market" happens to not do as you think it should. That kind of attitude is exactly what led to the depressions that kept happening during the last quarter of the 19th century, and led to the panic of 1907. What I find even more ironic is that you're arguments aren't much different than some that the banking community made back in 1913, when it became apparent that the impending close of the Aldrich-Vreeland and the soon-to-be-voted-on Owen-Glass acts weren't going to pander to them (example).

Can you please try to come up with an argument that doesn't accuse the entire SCOTUS and most of the legislative branch of the US of being in on this ridiculously vast conspiracy?
 
While the idea that you may have to pay banks to warehouse your money might be unappealing, the gains both in terms of economic and political stability, as well as a newfound stability in the purchasing power of your dollar would more than offset this.
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I don't buy it for a minute. What good would my money be to me if I cannot make more through savings? I might as well be paid company scrip in a mill town.

The word "coin" has a specific meaning:
coin (koin)

tr.v. coined, coin·ing, coins
1. To make (pieces of money) from metal; mint or strike: coined silver dollars.
2. To make pieces of money from (metal): coin gold.
3. To devise (a new word or phrase).

This excludes both printing money, and creating electronic money, as well as delegating such responsibilities to entities outside of Congress.
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So I guess the founding fathers refused to follow their own law by your definition.

http://www.frbsf.org/currency/expansion/banks/s87.html

Pedants will immediately point out that section 10 reflects a limitation on states, and not necessarily the Federal Government. However, clearly the spirit of the law is against fiat money, and clearly the Federal Government has no authority to delegate control of our money to a quasi-private institution like the Federal Reserve. The type of dishonesty to claim otherwise is exactly the sort of dishonesty required to subvert the spirit of the Constitution at any other level. On the other hand, I would be the first to argue that the Constitution is has not sufficiently addressed the crucial issue of who controls our money, and for that it needs to be amended.
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There is a little sentence at the end of Section 8.
"To make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof."

Give the congress full authority to make the Federal Reserve.

We are not talking about the "spirit" of the law. "Spirit" can be out to include whatever you think it should be and that is an intellectual dishonesty that sees limits on the States as limits imposed upon the Federal body.
 
Question for Tippit

What was the effect on the Spanish Empire's economy of large amounts of gold and silver coming into their holdings during the 15th-18th century?

They didn't have fractional banking

They had a gold and silver money basis

By your comments this should be economic bliss....was it?
 
As productivity increases and economic growth bring more goods to a market with a constant money supply, prices must fall,
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Since factors are paid according to marginal productivity, this means that when workers become more productive they expect, and deserve, a wage raise. But here we have Tippit suggesting a system where the exact opposite happens (their wages being the price of their labor for the firm) ... Tippit is for sure a champion of the people.

First of all, the emphasis on aggregate demand and thus the demand curve are Keynesian principles, which I've already dismissed.
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Now that's an academic argument. After seeing a demonstration of how you can have a situation where the price level is rising while the money supply remains intact, all you could do was dismiss the AD curve as a "vain attempt to justify fascist policies".

It didn't just come from unscrupulous lenders. Greedy would-be lenders with no money to lend are not lenders. The money had to come from somewhere, and that place is the Federal Reserve System.
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I know you will never reply to these questions, but how can you be so sure that the money did not come from the banks' reserves? Do you have the numbers to backup this assertion, or was it just another wild guess?

The rampant stock speculation that occurred in the roaring twenties didn't happen in a vacuum, it happened in the context of a Federal Reserve System that was printing money like it was going out of style.
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More ignorant statements ... I'd love to see Tippit's face the day he realizes that The Fed does not print any money.

Which is why the fact that Congress in its creation of the Federal Reserve System has unconstitutionally delegated control over our money to private bankers, and placed us in the predicament that we're in now.
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Being unable to backup his diatribes with actual number, Tippit resorts to the more common approach of claiming that The Fed somehow has some unconstitutional powers.
 
Hans said:
What was the effect on the Spanish Empire's economy of large amounts of gold and silver coming into their holdings during the 15th-18th century?
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You could also (probably) use a more recent example of what happened in America after the discovery of Comstock Lode and other large silver deposits in the west in the mid 19th century. With all that silver pouring in, which could be freely minted by law, it helped cause inflation which lead to the Coinage Act of 1873 and the demonetization of silver, causing deflation. As the money supply tightened railroad investors legitimately needing to borrow money went bankrupt, bonds collapsed causing a panic and a long depression.
 
vain attempt to justify fascist policies".
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Interesting enough it's also in violation of godwins law.


"As an online discussion grows longer, the probability of a comparison involving Nazis or Hitler approaches one."

Tippit: USCA Const Art. 1, §8, cl. 5, look into it
Tippit: U.S. v. Rifen, 577 F.2d 1111. C.A.Mo. 1978, look into it.
Tippit: Nixon v. Phillipoff, 615 F.Supp. 890, affirmed 787 F.2d 596. D.C.Ind. 1985, look into it.
Tippit: Foret v. Wilson, 725 F.2d 400. C.A.La. 1984, look into it.

Congress finds nothing unconstitutional with utilizing Federal Reserve Notes as legal tender.
 
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