A lot of people refute ABCT, but to me it makes sense. For example, someone said there would absolutely be deflation/inflation by reason of oil prices fluctuating when oil is hoarded/dumped.
How do I refute someone saying that a fixed money supply is beneficial only to the wealthy (other than me saying inflation makes everyone poorer)?
I’m sorry if this question is kind of dumb, but I tend to lack imagination.
“A lot of people [try to] refute ABCT”
“someone said there would absolutely be deflation/inflation by reason of oil prices fluctuating when oil is hoarded/dumped.”
“How do I refute someone saying that a fixed money supply is beneficial only to the wealthy (other than me saying inflation makes everyone poorer)?”
Increases in productivity lower prices and make everyone richer.
This isn’t a direct refutation, but since he’s making a positive claim (i.e. “a fixed money supply is beneficial only to the wealthy”), the burden of proof is on him to provide logic and/or evidence in support of his claim. Simply making the claim doesn’t automatically mean you have to refute it.
How do I refute someone saying that a fixed money supply is beneficial only to the wealthy (other than me saying inflation makes everyone poorer)?
I think you need to clarify that inflation dosent make everyone poorer. It redistributes wealth.
Those who first receive the money get the full benefit of its purchasing power. The first recipients of this money are large banks and corporations.
It is not until after the new money is lent out by the banks and spent by the borrowers that prices begin to rise.
The last people to receive the money are the losers in this game.
Inflation also hurts savers the most. In particular those on a fixed income.
So tell them the retirements of millions of little old ladies are being plundered by large banks and corporations through inflation.
A fixed money supply is not beneficial to anyone. It just adds unnecessary rigidity to the economy.
What do you mean by “unnecessary rigidity”?
Just an assertion, which I would like for you to prove without just further assertions. The floor is yours.
fixed money supply is not beneficial to anyone.
Ahh, a good point. A static money supply creates problems all of its own.
I think it is safe to say that a money supply controled by a political process, whether to fix / expand / or contract, will benefit those who are politically connected at the expense of those without political power.
I don’t think the OP literally meant “fixed” by a political process. I think he meant “fixed” as relative to now absent a cartelized fractional reserve banking system.
The emotional argument may prove more useful than the logical argument.
Assume and inflated money supply. The rich get the inflated money supply first (because usually they are politically connected), thus giving them the advantage over poor people, who get it last.
I don’t think the OP literally meant “fixed” by a political process. I think he meant “fixed” as relative to now absent a cartelized fractional reserve banking system.
This may be the problem with whom he is discussing the issue. I didnt neccessarially mean fixed in terms of rigging the game. I meant fixed as in the number of $ in an economy. Some people who oppose central banking do advocate fixing the number of $ at a specific amount. If that is what he is advocating to others then that is why he is having a hard time.
What people?
What people?
Some people who I have had the privlage of speaking with who advocate a gold standard. Didnt mean anything more than that.
My only point is that there may have been a misunderstanding between what he means and what the person he is having a discussion with thinks he means. A miscommunication.
Well, just for the record, perhaps not for your sake, advocates for the Gold standard such as Mises, Rothbard, etc… do not advocate for any such policy of a fixed money supply. Production of Gold would be an ongoing legitimate business in a free market.
Well, just for the record, perhaps not for your sake, advocates for the Gold standard such as Mises, Rothbard, etc… do not advocate for any such policy of a fixed money supply. Production of Gold would be an ongoing legitimate business in a free market.
Definitely, but when you say “fixed money supply” those who are unfamiliar with any other way of looking at money different from the present system might think “fixed” as in unchanging. When discussing these types of things you have to choose your words carefully. You and I may understand but other might not.
By fixed money supply I meant the government quit printing/coining money. So I think people should be free to mine gold, but the government shouldn’t make legal tender.
I favor banning FRB without the consent of the owner of the deposit.