We’re Already in a Depression

[Smitty-48]

seems like the case being made in here is that with our expansionist monetary policy, only the rich have money anyway

The rich are leveraging more of the money, the rich are the best at finding leverage, thus why they are rich

If you restrict the money supply, that won't change, it will simply become more pronounced.

[brewster]

seems like the case being made in here is that with our expansionist monetary policy, only the rich have money anyway

It isn't the monetary expansion itself that causes inequality, its that it's being loaned to banks, ie "the wealthy" for nearly nothing to allow them to invest and then get taxed on their gains less than a worker. This is part of what is driving up investment asset prices. If the "created money" were instead used to pay for roads, a "moon shot" carbon free energy program, or even a space colony, then it would be at least passing thorough the pockets of workers before it lands in the wallets of the rich.

StA said:

Why would I care if we spend out way our of another depression? It worked last time. I just don't want to do it in a way that involves millions of people getting killed.

Sensible stuff. Tell that to Smitty whose philosophy is what's good for Lockheed Martin is good for everyone, especially him.

[pineapplemike]

@smitty sure the rich will consolidate money without funny money flooding the market, but the rich are the chief beneficiaries of monetary expansionist policies, they only serve to benefit the rich further

[Smitty-48]

@smitty sure the rich will consolidate money without funny money flooding the market, but the rich are the chief beneficiaries of monetary expansionist policies, they only serve to benefit the rich further

Not really, inflation does not favor the rich. You should read more Marty Hash, he'll explain it to you.

[brewster]

Not really, inflation does not favor the rich.

Totally depends on the asset class. Many assets like real estate are pretty inflation proof, they'll simply track upwards with it, all else being equal. The rich don't hold that much in cash. Google "inflation hedge".

[Smitty-48]

Not really, inflation does not favor the rich.

Totally depends on the asset class. Many assets like real estate are pretty inflation proof, they'll simply track upwards with it, all else being equal. The rich don't hold that much in cash. Google "inflation hedge".

On the macro scale inflation favors debt holders over asset holders,

Yes, you can hedge, but on the generational scale, the money expansion is to pay for the welfare state and the debt will be inflated, so even your assets are devalued relative to the money being spent on the state, you are simply hedging to manage the damage.

[Smitty-48]

It's like my grandparents bought a house in Flintridge CA back in the sixties, maan.

For $46,000 USD

That was very expensive to them, they were worried it was too expensive.

At the turn of this century, that house sold for millions

The debt is being inflated away all the time, it's a continuous process.

[Smitty-48]

Marty is right. Money is imaginary

All American dollars are, is IOU's to redeem in America.

It is the belief that America will remain, not perfect, but simply better than the rest.

That is the Flight to Quality. America is a religion. It's all about faith.

[Smitty-48]

Just look at Japan, they are at 236% dept to gdp

Yet everybody is still lining up to hold their debt.

America has way more leeway than Japan, 108% dept to gdp is nowhere near America's near horizon limits.

America. Japan. This is the kind of debt everybody wants to buy.

Venezuela. Argentina. Not so much.

To equate America and Japan as being like Argentina and Venezuela, is fake news.

People don't believe in Argentina and Venezuela, people have faith in America and Japan.

[Smitty-48]

Money is imaginary and so is the ostensible crisis.

The problem in America right now is simple, Americans are being too negative.

It's just a mood. Americans are too hard on America, kicking her around like a two nickel whore.

It's all about perspective.

These moods and come and go, but when they go and you look back on them, you see that it was all in the mind.

Imaginary.