I second this demand.
Yep, because we were talking about empirical evidence and there isn’t any real evidence for the latter.
They are inflationary credit. A derivative isn’t backed by anything besides an asset (like a house) or another financial security. You never said you were going to regulate mortgage backed securities so banks can’t pile derivative upon derivative over fixed assets like they do all the time. They don’t need deposits. Investment banks don’t even generally hold deposits.
Can’t you at least be a Ron Paul and say you oppose all financial regulations except Glass Steagall?
Ban-Evader, you know as well as I do that this entire discussion (such as it’s been) has been theory-laden. So this is just more intellectual dishonesty on your part. Try again.
No it hasn’t. It’s been pages and pages of the “logic” of Austrian “economics” being twisted into novel geometric kaleidopretzelplexes and you’ve apparently only been skimming the parts around where you’ve hopped in and out of the thread. But there have also been certain posters who have substituted indiscriminate linkposting for argument, and some of them even made an attempt at empirical evidence.
Yes it has. Your OP itself is theory-laden.
Thanks for proving my point.
Be mad all you want - I couldn’t care less.
What’s your point? That my point is wrong, presumably?
My point is that this whole discussion has been value-laden. But you knew that already. I suggest you quit playing around.
I value helping people and creating and protecting jobs, you value defending the right of bankers to fuck the economy at all costs.
… And that refutes my point how?
See, this is what I mean. You’re not interested in serious, rational discussion. You just want us to help you pat yourself on the back over your alleged moral superiority. FYI, I consider you to be morally bankrupt.
You think I’m morally bankrupt for not granting Goldman Sachs a fundamental right to make proprietary trades with its clients money? I doubt it. Maybe you do, though. But you still haven’t established that libertopia wouldn’t have a business cycle or that financial derivative credit growth would slow or cease. So far that’s just a “maybe”.
Thanks for implicitly admitting that you employed the red herring fallacy in this post - and therefore that you’re being intellectually dishonest. That amounts to a complete concession of your position. In other words, you seem to have no intellectual leg to stand on whatsoever.
I’ll add that your last post clearly supports the above.
alsdjfalsdjfos,
“certain posters who have substituted indiscriminate linkposting for argument”
My english is not good enough. This would not be easy to pursue a lengthy discussion. Even so, you are just seeking pathetic excuse for not reading the articles I provided. Furthermore, you have not replied to my previous arguments. You have just selected a few passages you are willing to reply.
And about what you have said before …
“I should also note that the only way to completely get rid of credit growth would be to outlaw credit growth through far reaching financial regulations to eliminate all fractional reserve banking and paper currency, abolition of public property in land and application of all rents of land to private purposes, equal liability of all to work, and abolition of all forms of interest and credit.”
You have yet to prove it. And I’m still waiting.
“A derivative isn’t backed by anything besides an asset (like a house) or another financial security. You never said you were going to regulate mortgage backed securities so banks can’t pile derivative upon derivative over fixed assets like they do all the time. They don’t need deposits. Investment banks don’t even generally hold deposits.”
I repeat once again. With credit expansion, the limitless availability of funds allows the ever-increasing purchases of security, and the like. Otherwise, the interest rates will rise and immediately stop and deflate a developing bubble. You cannot speculate without money.
And it is not much more useful to invoke the keynesian theory of animal spirits. Without cheap money, a lengthening of the structure of production requires a sacrifice of the present prosperity (short term) in favor of a prosperous future (long term). All prices cannot increase at the same time. But, a lengthening of the production structure without prior savings only leads to a boom, where everything seems to increase at the same time (consumption, investment, profit, etc.), generating an excess of optimism. And from that moment, only, financial markets begin to boil, and bubbles inflate (then explode).
Bankers were seeking profit, making unsound and risky investments because there are profits to be made, a condition which had been made possible with inflationary credit and, of course, deposit insurance.
This is exactly what happened during the subprime bubble.
I don’t dispute any of that (besides the DI bit). I’m just saying that if central bank lending or monetary base growth is insufficient, then there are other ways for private agents to create money. If the supply of base money and available reserves is insufficient to sustain lending at the level that investment banks (and their customers) desire or demand, they’re free to create money in the form of securities which are either money or something very similiar to it for practical purposes. Which is exactly what happened.
I already explained why banks could not create money in excess of what public really want. Read The Theory of Free Banking.
Going back around again. A monopsony is a sufficient condition for monetary expansion, but not a necessary one. And if security purchasers make incorrect investment decisions, they can grow credit all they want.
mustang19,
Get a job.
And drop out of school? I got enough on my plate without burgerflipping grease.
Then go to class.
But they’re probably teaching the marine biology of whalefucking in Goolrich 301 at the moment. It’d be embarassing to just walk in unnannounced and unenrolled.