26 posts shown.
casuallynx8 said:Perhaps that is precisely why we are seeing QE2 move forward?
Well, I guess☕
You should probably just head over to ZeroHedge if you want to blow your horn about the downfall of America—they've been having that exact same debate there for two years already. Honestly, there have been at least 23 "solid" announcements by now claiming the dollar and the US would collapse within a week, or a month at most.
Honestly, it gives me the chills thinking about how countries that leaned hard into Keynesian interventionism during the crisis are now finally seeing the light at the end of the recession tunnel—take the USA and Germany, for example, they’ve technically moved past it. Meanwhile, the folks who put all their faith in the "free market" magic, like Ireland, are basically left standing out in the cold without any cover.
All jokes aside, I was actually arguing this point just two years ago—I kept insisting that we needed massive capital injections into our energy and agriculture sectors, even if it was just a quick fix to stop the bleeding of $2-3 billion leaving the US every single year. Fast forward two years later, and we've already watched an extra $6 billion vanish, and by the time anyone actually decides to get moving, we're looking at another $12 billion flying right out the door.
For the longest time, the big buzzword around here was this idea that "the market will decide everything." Well, the market certainly decided we should focus on retail, and now look at us—we've got massive big-box retailers, distributors, and shopping malls popping up on every single corner.
There’s plenty of it out there—stories about credit and loans that are honestly just heartbreaking. A friend of mine once took out a mortgage through Antunović to buy an apartment. The kicker? She never even got the keys. But get this—for fifteen years, she’s been dutifully making every single payment toward that loan. It’s a total nightmare. This woman has been going to work every single day for fifteen years, and for what? Not a cent to show for it. And she isn't just anyone, either—she’s a mechanical engineer, and I’m pretty sure she even finished her Master’s degree in the meantime.
Maria Thomas48 said:If what makes you happy is expanding equations to an open system—basically using the equality of three deficits. To be more precise, when a state balances imports with exports (total trade equals zero), it acts as a virtually money-isolated system.
If there’s a trade deficit with foreign nations, things get even worse regarding the monetary profit within the community.
Sum of monetary profits = budget deficit - trade deficit = - financing deficit
or the full equality of three deficits:
trade deficit = financing deficit + budget deficit
All of this is explained in the translated book Krueger "Macroeconomics" on page 39. You can download the PDF version from the University of California economics department website. It uses the symbols economists typically use, but the essence remains the same.
Well, you can clearly see the state's monetary balance in an open system. Without a positive monetary balance, the state loses money, the economy works at a loss in total, and everything heads 100% toward a crisis. Every economist knows this, but they don't realize that by balancing the trade account (exports=imports), a reduction occurs which shows that:
Sum of monetary profits = budget deficit = - financing deficit
Which implies the following. The money savings realized by entities (companies and individuals) are then actually financed by the government budget deficit. If the state took out credit for the deficit, then it means it has to pay back more than it borrowed. Or rather, it needs to pay back more than the economy actually generated in monetary profit.
Our economists fail to see that almost direct link between monetary profit and the budget deficit. In reality, it differs because of the trade balance. That's why I try to find a solution for all countries at once and I balance the trade accounts (through swapping). That way, no single country pays off the debts of others.
Is it clearer now?
It's even easier to prove that a money-isolated community suffers a monetary loss in circulation because one part of the entities keeps accumulating monetary profit, which is explained by the slowing down of circulation. This happens because the monetary profit accumulates and is then invested.
How will you solve the monetary loss in circulation? By speeding up the circulation of the remaining money. Genius. You're close to a Nobel Prize (big money is smiling at you). Just explain it to Šuker and we'll be set. You haven't managed to convince me how the household budget would function then, or where that acceleration comes from. I know practically how it could be done, but I'd like to hear from you how to make all payments at the same time with less money in the system.
Mr. Matthew Patel12, thanks for explaining the slowing of money circulation. I have nothing to add.
Regards
sites.google.com/site/financijskisustav/home
I've been following this thread, but I'll be honest—I'm pretty lost on what you guys are trying to get at. This whole debate about the velocity of money and the underlying model is just confusing me. And regarding regulating that speed—as far as I understand, if you want to speed up circulation, you'd lower the reserve requirements, which reduces the amount of immobilized cash. On the flip side, shrinking the money supply usually doesn't speed up the cycle; it typically just leads to liquidity issues.
Andrew Booth29 said:And there isn't exactly a wealth of profound wisdom to be found here... You have two pillars, right? By letting those from the old system die out, you’re essentially just shifting the weight—increasing the share of the second pillar while shrinking the first. It's a numbers game. Give it thirty years, and maybe you'll be fine.
Exactly! In about thirty years, there won't even be a pension left to talk about—and honestly, that second pillar will probably be gone in fifteen. Everything will be just peachy until we all go straight from our desks to Arlington National Cemetery.😁
Andrew Booth29 said:The parent company gets its funding straight from its subsidiaries... 😉
I don't know—looking at how many of the group's star performers are showing profits this year, I'm a bit floored. I haven't gone through the financial statements with a fine-tooth comb or anything, but man, those accountants must have been working overtime—probably pulling double shifts just to make the numbers dance! 🤷