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Ron Paul on Bloomberg "The FED Destroyed 96% Of The Value Of The Dollar" 9/23

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posted on Sep, 23 2009 @ 08:44 PM

That's pretty crazy, 96% is MASSIVE!

All in all the interview was excellent, glad to see good points on the msm.

I agree with what he often stays "Govt. is like people, just like people should save and spend sensibly, Govt. needs to do this as well."

posted on Sep, 23 2009 @ 09:02 PM

That's pretty crazy, 96% is MASSIVE!

I can not see the video on this old computer, however 95% was what I calculated after I heard Obama doubled the money supply in the beginning of the year. (fractional banking practices do the rest of the inflation) After that piece of idiocy I could not believe anyone would still support the crooks in DC.

The health Care debate is a laugh we will be too busy starving thanks to inflation and the food safety con job that regulates home gardens and bankrupts US farmers to worry about trying to find a doctor.

posted on Sep, 23 2009 @ 09:44 PM
reply to post by ModernAcademia

Is Ron Paul ever wrong?

I wish I could understand all the nuances of the current system, but unfortunately the KISS anacronym seems to be the only thing that makes sense to me when it comes to economics...Save, then purchase...

Maybe I am just dumb.

I hope one day the rest of America can wake up to the wisdom this man possesses.

posted on Sep, 23 2009 @ 10:25 PM
Ron Paul is mistaken.

Here's how you know.

Consider what has happened to the economy.

First, we had the normal situation with Greenspan carefully regulating inflation by making small adjustments in the interest rates.

Last year, we began developing a new problem. Before the problems in the latter part of 2008, the economy was not responding to the movement of the Fed interest rate. Do you recall how rates were so low, but it was not causing inflation? At that time, Fed Res regulators were wondering what was going on. The were losing control.

Consider the facts. If you move rates down, more businesses and indiv can qualify for loans. More loans mean more purchasing, which causes an increase in demand, followed by inflation. Prices go up when demand goes up, given supply takes time to catch up later.

The Fed Res knows that it takes 9 mo to see any changes in the economy following the interest changes. That's why they only resort to large changes when things are not moving.

When you saw the Fed Res move interest rates to the bottom, and the economy did not inflate, a new condition came into view. Here's the new condition, and how to know this diagnosis is correct. The US was running out of sufficient money supply. There was not enough money around to pay for all the things that needed to be done. More money was created.

When more money was created, and interest rates were at the bottom, like now, there was and to this day is no inflation of note.


Not enough money supply. We need more money. Too much value disappeared, hence too much money disappeared. Think of it this way. Let's say you live in a small village of 20 people. Your village is isolated, so there is no money coming in or out from an outside source. Now consider that there are only 10 dollars to go around. You have to wait to get one. Same problem here.

The right thing to do to loosen up credit and get the economy moving is to produce enough money for the economy to function.

This is the mistake they made in the Great Depression. They did not provide enough money to get the country working and moving again.

This time they got it right. In theory, if you have interest rates at the bottom, and you produce loads of money, and there is no need more money.

Once there is enough money, then the movement of interest rates will affect inflation again, and the economy engine will be gassed up and running down the railroad.

Let the Fed Res do their job. They are slow and methodical. They have not created any inflation, therefore they have not yet created enough money.

Thanks to the Fed Res, they did not make the same mistake as Hoover and the conservatives did in the Great Depression. They thought the country would settle back to normal through normal capitalistic methods. They were too shortsighted to realize that there was not enough money supply.

Thank God the Fed Res did not make the same mistake twice.

They know what the heck they're doing. Stay out of their way. That's why we made them separate from government. Congress would have messed it up. The bankers know how to run things. They just got a little too enthusiastic about how fast the economy was succeeding, not realizing that there were so many fraudulent loans.

A country can only succeed based on honesty, so the blame lies at the feet of those who filled out mortgage applications and did not consider that they would be unable to pay the mortgage when it hit the full interest payment level. (This does not include those who had a good plan, but were shot down by the loan fiasco.)

Thanks for reading. Good luck. It's going to get a lot better. We are turning a golden corner in the economy. In a year, with all the new money supply and great interest rates, we may even be able to achieve inflation, which is a great sign that the economic beast has had it's fill, and things are rolling along again like normal.

It's the money supply, y'all. Not a mistake by the Fed Res. They are right on.

If Ron Paul and other arch conservatives were in power (like Lyndon LaRouche, who also wanted the gold standard), we would have such a choke hold on the economy due to lack of money circulating that we would be slowed down to a crawl. The gold standard is an old concept and has no place in the modern world.

As far as the idea of destroying 96% of the value of the dollar, get real. Go down to the local supermarket and buy a loaf of bread. Same as last year. The best way to gauge the value of the dollar is to watch the value of gold in dollars. Gold is a constant. It's always worth about the same thing, with a few minor considerations. What you are seeing in the price of gold is the value of the dollar. Gold has only changed about 20% over the past year or so, and is presently at about $1000/oz. For the dollar to have lost 96% of its value, gold would have to be selling for over $10,000 an ounce. Is that happening? No. Is Ron Paul wrong? Yes.

People, Ron Paul is wrong. He's a gynecologist, not an economist.

[edit on 23-9-2009 by Jim Scott]

posted on Sep, 23 2009 @ 10:53 PM
reply to post by Jim Scott

Interest rates used to be determined by the forces of economics. Now they're dictated by committee.

The fed is a monopoly on money creation, and an unnatural influence on interest rates. There is no "right" or "wrong" thing the fed should do to manipulate the economy.

The economy being manipulated by the fed is the cause of our problems.

Here's the "business cycle" -

First, the banks collude to lower interest rates to entice borrowers. This puts a lot of money in circulation.

Then, all this money lets the economy gear up and become super productive.

Once they see the public having built up a lot of assets and value, then they start increasing interest rates and calling in loans,

This makes money scarce, and everyone everywhere have to tighten their belts, sell of their property at pennies on the dollar, and stock market prices go down, during which the rich folks buy up all the newly created value the bubble of credit allowed.

Then the cycle repeats.

It lets the country build up real wealth, then lets the banks confiscate it. And they call it "normal."

It works like this by design.

End the fed.

posted on Sep, 23 2009 @ 11:39 PM

Originally posted by Jim Scott

The right thing to do to loosen up credit and get the economy moving is to produce enough money for the economy to function.

This is the mistake they made in the Great Depression. They did not provide enough money to get the country working and moving again.

This time they got it right. In theory, if you have interest rates at the bottom, and you produce loads of money, and there is no need more money.

Good reply, Jim! I have a number of questions / points to bring up.

1) You are right - in theory - the role of the Fed would be to open up the credit market, but in reality that is not happening. Interest rates cannot go lower than they are at this point and credit continues to contract. Both personal and business credit.

(edit - yes, they can technically go negative... but would any bank lend on that when they are not even lending now)

So, if they are follow the correct theory but results are not showing what the theory would expect how can we say they are taking the correct steps.

2) Your point about the wealth destruction is very important, and is one many people look past when talking about all the money put in the system over the last year. However, there is no accurate records that point out the debt destruction vs. newly minted money.

That said, is there is no good guide to how much money vanished - destroyed - how can we say we are not entering a period of debt deflation?

3) If the actions were protective, and working as expected, why the continued downward pressure on the dollar?

Let's forget the "Evil Fed" discussion and just look at the economic factors.

Credit continues to contract , banks are not lending, and the only spending the economy really is seeing is thanks to govn't spending / programs. When those lines of funding vanish the economy will still be in a world of hurt.

While some economic indicators are showing improvement that is only due to the fact that the previous few months were so poor. So, the indicators are "improving" over what happened 3 months ago the results are still extremely poor over a year to year comparison let alone a two year comparison. (and this is in most areas of the economy - port traffic, sales, business spending, employment, housing)

On another note, you are right that the Feds lack of reaction added to the severity of the Great Depression; however, the economic realities of today do not resemble what the US faced during that period of time. To assume the what policies would have improved the conditions during the GD would fit for our current economy is false.

While we can see what "not to do" based on past experience we would need to apply it to our current situation. It appears the leaders in Govnt and the Fed did not apply that approach.

Anything can change, anything can happen, but at this very moment it is not working out. While the Fed is in theory taking the steps a classic Milton Friedman-esque economist would expect, the results are not yet showing positive affirmations. So, as of right now, no, the Fed isn't working.

[edit on 23-9-2009 by tk1967]

posted on Sep, 24 2009 @ 06:34 AM
reply to post by Jim Scott

Are you really trying to sit her and tell us the fed has done a good job controlling inflation? Really? If you take how they calculate inflation, sure.

Problem is, what they leave out. The reported inflation rate is based on a price index, in this case the CPI, and every price index is based on the prices of a particular list of goods, called a basket of goods. The choice of goods to include in a price index basket is arbitrary and choosing a basket that includes goods whose prices are either rising slowly or falling and excludes the goods whose prices are rapidly increasing results in lower reported rates of inflation. They estimate the 'core inflation rate'. This core rate excludes product prices that are "volatile," and by volatile they mean rising faster than other prices. Excluding the most inflationary prices from the CPI estimates allows the feds to conceal the true harm of inflation.

Of course, at all times, some prices are rising faster than other prices. Prices don't rise in tandem. Inflation always affects some goods more than others. Omitting volatile prices from the estimates is simply a way to discount inflation's effects on the public.

The CPI is a government statistic, and since the government's expansionary monetary policy creates the inflation, officials have an incentive to underestimate these numbers. Underreporting inflation helps government officials in at least three ways.

First of all, it provides more favorable economic news. Elected officials want to report and take credit for any positive economic announcements.

Second, if the government reports a rate of inflation that is lower than the actual inflation rate, this will increases tax revenues through bracket creep. If the actual inflation rate is 10%, but the measured rate of inflation is 4%, some taxpayers will be pushed into higher tax brackets even though their real income has not increased.

And third, a lower reported inflation statistic reduces government spending by limiting the spending increases that are tied to inflation. The state can take credit for cost of living adjustments that are allegedly keeping up with inflation although in real terms the payments are falling.

For you to make the case that inflation has been kept 'in control' by the Fed, and that they 'saved' us shows you aren't quite seeing the whole picture and don't understand this crisis. The Fed helped cause this crisis, and all these actions have done is the equivalent of putting a patient with cancer on great pain meds. The cancer is still there. Same issue here. All the bad debt is still there and things are getting worse. You wouldn't tell a cancer patient they have been saved when the cancer is still there. Sure they feel a little better, but the cancer is still spreading, and various organs are having increasing problems. You want to save the patient, you need to shrink and then eliminate the tumor. Same thing here. Problem is, if you just cover up cancer it continues to grow...... just like this financial crisis.

posted on Sep, 24 2009 @ 10:43 AM
reply to post by Jim Scott

Ron Paul is mistaken.
Here's how you know.
Consider what has happened to the economy.

I HAVE considered what has happened to the economy and I see the bankers behind it.

First consider the roaring 20's followed by the crash of the thirties. All set up by the bankers who walked away with all the marbles at the end of the game. Link

Next look at our current situation.

First starting in the 70's we have a proliferation of regulations - OSHA, EPA, USDA, FDA, Child Day Care, Tax law on employees, - that raise the bar on new entries in business. The increase in lawsuits and changes in insurance did not help either

Second in the 80's, just like in the roaring twenties, we have banking law changes that encouraged "Leveraged Buyouts" "Hostile Takeovers" where debt free corporations are suddenly torn apart, shipped over seas or if the company stayed in the USA it had a high debt burden forcing a “value-enhancing effect”.of improved efficiency, eliminating wasteful corporate expenditure, encourages the sale of low-performing divisions. In effect removing employee benefits, firing older/high paid employees and replacing them with lower salary foreign born employees. Link

Third in the nineties we had the ratification of the World Trade Organization and NAFTA with the "Free Trade Agreements" The addition of China to the World Trade Agreement moved what was left of our industry overseas.

Was all of this organized?
Organized plans were developed in the forties by a highly powerful, unelected group of financial and industrial executives who wanted to drastically change agricultural practices in the US to serve their collective corporate financial agenda. The "Committee for Economic Development, was officially established in 1942 as a sister organization to the Council on Foreign Relations. CED has influenced US domestic policies in much the same way that the CFR has influenced the nation's foreign policies." Link

"They were assassinated because they opposed that fraternity of corporate, government, and banking heads whose goal is global empire. We Economic Hit Men failed to bring Rolds and Torrijos around, and the other type of hit men, the CIA-sanctioned jackals who were always right behind us, stepped in.” Perkins

What has been the result of the Bankers plans?
The Department of Homeland Security says 80% of our ports are operated by Foreigners and they are buying and running US bridges and toll roads. Link

Statistics (courtesy of Bridgewater) showed in 1990,before WTO was ratified, Foreign ownership of U.S. assets amounted to 33% of U.S. GDP. By 2002 this had increased to over 70% of U.S. GDP. Link

An analysis of the 2007 financial markets of 48 countries shows the world's finances are in the hands of a few mutual funds, banks, and corporations. This is the first report of global concentration of financial power ..Link

The “Harmonization” of first world agriculture laws with WTO wishes resulted in a massive transfer of land ownership from private to corporate worldwide. Link

This is a sampling of the industries with over 50% foreign ownership, according to Source Watch

* Sound recording industries - 97%
* Commodity contracts dealing and brokerage - 79%
* Motion picture and sound recording industries - 75%
* Metal ore mining - 65%
* Wineries and distilleries - 64%
* Database, directory, Book and other publishers - 63%
* Cement, concrete, lime, and gypsum product - 62%
* Engine, turbine and power transmission equipment - 57%
* Rubber product - 53%
* Nonmetallic mineral product manufacturing - 53%
* Plastics and rubber products manufacturing - 52%
* Other insurance related activities - 51%
* Boiler, tank, and shipping container - 50%
* Glass and glass product - 48%
Coal mining – 48%

The bankers and the corporate cartels were behind the trashing of our country from the get go. Check out the Rockefeller Foundationsand see who is paying all those "Political Activists" and UN NGOs screaming for more and more regulation.

posted on Sep, 24 2009 @ 04:03 PM

Originally posted by Jim Scott

People, Ron Paul is wrong. He's a gynecologist, not an economist.

Can you tell by watching his wagging finger?

Excepting Swiss Frank, there is no world currency that wouldn't go down the toilet over the span of some 90 years the way Paul handles the flush lever.

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