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Originally Posted By: Derid

So you are saying "when right uses the term" , instead of going by what the words and terms *actually mean*.


I am calling BS on this. When right uses "central planning" meaning is very clear and it is not "controls and oversights exerted over relevant area of X". Just ask any of our local conservatives. Communism/Socialism/Central Planning are interchangeably used terms with single meaning - destruction of American values.

Ron Paul was using this in exactly this way, and it is consistent with his position on FED. While he might be right that this is not beneficial to US public, he arrived to this conclusion by taking 3 wrong turns.

Last edited by sinij; 09/25/12 08:07 AM.

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Quote:
Our monetary policy is centrally planned.


If you want to get anywhere with your argument you need to drop your right-wing innuendo.

Responding to "Our monetary policy is controlled by the FED".

Monetary policy is only one aspect of our economy. FED is not all-reaching, all controlling entity. Plus, there is no workable alternative (gold standard is not it) to having a monetary policy. There always will be some control, regardless to what this policy is.

Responding to "QE3":
I agree that QE3 is risky move that is not immediately beneficial to US public, but this is a reality of a currency war with China. US is doing equivalent of "all in", with China economy already overheating and starting to fall apart directly as a consequence of trying to match US moves.

"Do nothing" alternative is to continue losing jobs, wealth and economic growth to China that artificially pegged its currency to US dollar.

I'd explain this in detail, but this is too much effortposting and is unlikely to be understood by many/any posters here.

In closing - QE3 is only partially has to do with US economy and keeping borrowing costs down, it has a lot more to do with intentionally devaluing US currency to stay competitive in the global market. I don't expect "there to be communists" 80-year-old Cold War-mentality Ron Paul to understand such nuances. I respect him as a man of principle, but both his agenda and inflammatory presentation are flat out wrong in this situation.


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There is no BS to call. The term means what it means.

When he is referring to additional central planning/control he is referring to "price fixing" in regards to interest rates. the Fed is not current setting a policy to "promote moderate" interest rates - it is artificially flooring interest rates in an extreme manner. By setting the price of money in this fashion, he is equating it to a type of price control - which is technically accurate. He says that initiating such price controls is an aspect of central planning and the Fed is thereby increasing the amount of exercised central control over our economy , which is also technically accurate. Interest rates are now more the result of a centrally planned action by far than they were say 10 years ago, ergo the amount of central planning in our economy has increased.

You yourself said earlier in this thread (which is what prompted me to enter it in the first place) that the true credit rating was interest rates. Thus you surely see the magnitude of the distortion being created, even by your own evaluations.

Whether you think the action taken by the Fed is correct or not, both Dr Pauls and my own description of what it happening and the terminology used are accurate.

Others on "the right" as you put it, may or may not have misused the terms in the past. In fact I will say it almost certainly has been misused at various points by various people. Nonetheless, the terms mean what they mean and the Fed is doing what it is doing.


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FED does not have absolute control over interest rates, if markets decide not to buy US Treasuries, there is very little FED could do to force the issue. When I said "interest rates" I referred to US Treasuries interest rates, not FED-controlled inter-banking interest rate. These are related but not the same.

US Treasuries dictate cost of borrowing, and probably the only reliable indicator of what markets think about state of the economy. Currently US Treasuries rate is below inflation levels, meaning people are willing to lose money to hold these. Meaning markets think it is extremely unlikely that US will meaningfully default (all shenanigans with US congress have very little to do with getting paid in grand scheme of things) and that there is very real possibility of deflation as a result of on-going deleveraging.

In contrast - PIGS Treasuries rates are through the roof. Last time I checked they were in double digits. This is how market signals no-confidence.

As to rating agency - anyone can open one and start issuing ratings. Some ratings mean more than others, but at the end all of them are financial equivalent to punditry.

Last edited by sinij; 09/25/12 08:20 AM.

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Originally Posted By: sinij
Quote:
Our monetary policy is centrally planned.


If you want to get anywhere with your argument you need to drop your right-wing innuendo.

Responding to "Our monetary policy is controlled by the FED".

Monetary policy is only one aspect of our economy. FED is not all-reaching, all controlling entity. Plus, there is no workable alternative (gold standard is not it) to having a monetary policy. There always will be some control, regardless to what this policy is.

Responding to "QE3":
I agree that QE3 is risky move that is not immediately beneficial to US public, but this is a reality of a currency war with China. US is doing equivalent of "all in", with China economy already overheating and starting to fall apart directly as a consequence of trying to match US moves.

"Do nothing" alternative is to continue losing jobs, wealth and economic growth to China that artificially pegged its currency to US dollar.

I'd explain this in detail, but this is too much effortposting and is unlikely to be understood by many/any posters here.

In closing - QE3 is only partially has to do with US economy and keeping borrowing costs down, it has a lot more to do with intentionally devaluing US currency to stay competitive in the global market. I don't expect "there to be communists" 80-year-old Cold War-mentality Ron Paul to understand such nuances. I respect him as a man of principle, but both his agenda and inflammatory presentation are flat out wrong in this situation.


You should honestly go look up the meaning of central planning... and all the various types of central planning. Quit artificially invoking partisan connotations to commonly used descriptive terms. What you said about monetary policy and the necessity of *some* central planning of monetary policy is subject to wide debate. The fact that the Fed *is a* central planning body is not.

I am not going to start misusing terms, or twist myself in knots looking for alternative word usage simply because being accurate sets off your liberal dog-whistle effect.

You re-iterate (and why I cannot fathom... ) that the Fed is not an all-controlling entity for the economy. Which is correct. Perhaps, though some monumental effort to misunderstand and misconstrue that I cannot fathom... you are somehow thinking that I am trying to say that the entire economy is centrally planned. So I will say again, just in case you somehow got to that point against all logic.... the Fed is one aspect of central planning that exists in a mixed economy.

As for the "currency wars" I am quite familiar with that aspect. I am more than a little surprised that you are.


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Originally Posted By: Derid
You should honestly go look up the meaning of central planning...


Fag is also British for a cigaret, but if I were to call someone a fag it is very clear I am not asking for a smoke.

Don't use "central planning", while you assured me, and I heard you, that you are not using it to imply alternative meanings, anyone else reading our discussion would likely to see it differently. "Central Planning" has been re-purposed as a slur by the right, and I don't want to deal with some knuckle-dragging conservative quoting something I post and replying "see, he stands for redistribution!"

Last edited by sinij; 09/25/12 09:01 AM.

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Originally Posted By: sinij
FED does not have absolute control over interest rates, if markets decide not to buy US Treasuries, there is very little FED could do to force the issue. When I said "interest rates" I referred to US Treasuries interest rates, not FED-controlled inter-banking interest rate. These are related but not the same.

US Treasuries dictate cost of borrowing, and probably the only reliable indicator of what markets think about state of the economy. Currently US Treasuries rate is below inflation levels, meaning people are willing to lose money to hold these. Meaning markets think it is extremely unlikely that US will meaningfully default (all shenanigans with US congress have very little to do with getting paid in grand scheme of things) and that there is very real possibility of deflation as a result of on-going deleveraging.

In contrast - PIGS Treasuries rates are through the roof. Last time I checked they were in double digits. This is how market signals no-confidence.

As to rating agency - anyone can open one and start issuing ratings. Some ratings mean more than others, but at the end all of them are financial equivalent to punditry.


Apparently you missed the part where the Fed is manipulating the T-bill rates by adding them to their *own* balance sheet. The Fed has at least 1.6 trillion in T-bills now , that we know about. Many people suspect the number is far far higher - but we wouldn't know without a true and full audit. And thats just the direct buys, not the deals where Fed extends loans to entities who buy T-bills or buys toxic assets in return for T-bills.

You are correct though to say that noone expects that the USA will default anytime soon. However without the Fed propping up our reduced borrowing costs, the market would long since have squeezed us. Our demand for credit is high, and the Fed is supplying even more than is needed - flooding the market with cheap credit.

As for ratings agencies... well I never said those were worth a damn. As I explained previously, just because they are right *this* time doesnt mean they generally do a good job.


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Originally Posted By: sinij
Originally Posted By: Derid
You should honestly go look up the meaning of central planning...


Fag is also British for a cigaret, but if I were to call someone a fag it is very clear I am not asking for a smoke.

Don't use "central planning", while you assured me, and I heard you, that you are not using it to imply alternative meanings, anyone else reading our discussion would likely to see it differently. "Central Planning" has been re-purposed as a slur by the right, and I don't want to deal with some knuckle-dragging conservative quoting something I post and replying "see, he stands for redistribution!"


So you propped up straw men, called me absurd (incorrectly), danced all around the topic, and generally acted like a prick because you didnt want someone misusing something you said in a quote?

If it was that big a deal, why the hell didnt you just ask nicely?



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First, it wasn't immediately obvious to me that you understood exact meaning. I wasn't sure until fairly late into the debate if you are arguing that "FED = communism" or "FED = controls". Absurd refers to former and I am very familiar to constant abuse of this and similar terms by the right. I presented alternative politically neutral terminology and you rejected it calling it "beating around the bush". Question I keep asking myself, that if you clearly see that I object to "central planning" use and do not intend it to use it as a political slur, then why insist using it and standing on a point?

I am still not convinced that Ron Paul understands exact meaning, and that what my initial objection was based on. He is all "gold standard" utopian-libertarian. No concessions to practicality in any of his views.


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Second, I apologize if you took offense at anything I said.


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