David Stockman's Stark Warning for America

Stockman is actually a pretty smart guy. Of course I am biased, if you read up on the whole of what he is saying its mostly the same crap I have been saying for a good long while.

I don't remember you being nearly as critical of GOP fiscal policy. It is only since Mitt santorumed libertarians have you even started voicing criticisms.

I dont recall ever being favorable towards Bush policies.

Afterwards ofc it will be Obama policies that I spend the most time criticizing, because his policies are the ones that get implemented. Criticizing GOP policies again has relevance when they start losing elections with them.

Besides, go read his NYT article and such - Stockman is saying a lot about a lot more than GOP policy.

http://www.nytimes.com/2013/03/31/opinion/sunday/sundown-in-america.html?pagewanted=all&_r=0

Coming from a guy who is only critical of GOP and no one else, you have no leg to stand on.
Keep the blinders on and keep your socialist manual handy.

I also don't recall you sacrificing virgins to Satan. Is that suppose to qualify you as a moderate?

Interesting read, but "The state-wreck originated in 1933, when Franklin D. Roosevelt opted for fiat money" is stretching it.

Fiat currency is better system than growth-stiffing deflatory gold standard. It also more prone to abuse via printing press, but similar was done since roman times with golden coins via adulteration.

"That Mr. Greenspan’s loose monetary policies didn’t set off inflation... "

It did set a number of bubbles, so whats the difference? Ether way, monetary policy and Reagan-style deficit spending (and unfunded tax cuts) are much closer to the "case" than anything Roosevelt done.

Who ever said I was "moderate" ? Thats a completely subjective term anyhow, all I find silly is when you pretend or assume I support X when its not the case.



Not stretching it, though the real issue goes back to the formation of the Fed itself as seen with Ben Strong creating the bubble that led to the Depression. Of course FDR further entangled , and then Nixon abandoned Bretton Woods entirely opening the path to Reagan style deficits and setting the stage and current mentality leading to the present clusterfuck we find ourselves in.

The fact that it is still obviously possible to completely screw up a metal currency does not mean that fiat currency is a great idea. But rather, fiat current opens up a whole new and unnecessary playground for mischief.

When you hear modern proponents of standards based currency talk, its not about the ideal of backed currency in of itself as the ideal but rather and additionally a particular philosophy and methodology for managing backed currency.

It is true that some govt have in the past even imposed deliberate deflationary policies and attempted to deflate a currency to peg to a certain measure of gold - like what Japan tried in an example you pointed out recently - however that has been known to be a boneheaded move since at least 1880.

The goal is stability, and trying to force one direction or another never ends well.

This is bona fide Stockman - where he is right on the money.

As I have said before (though maybe not here, actually) Supply Side Economics is just Keynesianism for Corporatists.

Which doesnt mean I think taxes should be obscene in the leftist sense, but rather that huge deficit spending and thinking you are going to get a free lunch because real growth will outpace your deficit liabilities over time is just pie in the sky.

If the goal is only stability printing moderate amounts of money during periods of economic expansion is by far the best way to get there. It is overprinting and deficit spending that get us in trouble, they are common, but not necessary part of fiat currency system.

Problem with gold standard ideas and the like is that expanding money supply during growth times is difficult. If you have increase of productivity and economic growth you will end up getting constrained by your monetary system and will produce a measure of deflation that will limit growth. Advantage of a fiat system is that it can expand monetary system on demand to address this problem.

It can also print money and create bubbles, but that is not unavoidable. It can also speed up recovery from complete systematic collapse - you can't inflate away your debt, so starting with a clean slate becomes harder.

Did any nation in modern history went bankrupt while still holding to a gold standard?

There are a few ways to deal with that, but reserve and currency management is really a topic worth a thread (or book) of its own. Acknowledging that backed currency in itself in not a panacea for all economic issues lets move on for the time being.

While technically, it is theoretically possible to not create bubbles under a fiat system - the core problem is that the system itself is inherently politically driven. In theoretical terms, something that is hypothetically workable can quickly become unworkable when management of said system becomes the domain of politicians.

A core reason backed currency is favored by many, is the inherent restraint it puts on politicians.

Sure, over time.. if we assume for a second that our political class is capable of learning, eventually it may be possible to learn enough about the economic and monetary dynamic to evolve a comprehensive enough set of guidelines, laws, and regulations that result in the creation of the proper amount of money at the proper time and keep things flowing smoothly from a rational constructionist standpoint.

The problem, is even assuming that - I think it will still take literally several hundred more years of massive booms and busts to get there.