Economics thread. Have you had enough of wizard of oz monetary scientists?

Here is a workable solution to the "banking crisis."

http://www.energybackedmoney.com

This idea was proposed by Thomas Edison all those years ago and I think it has merit as a solution to the worlds financial problems.

Please don't bother to post without reading the link first. I want to hear well thought out criticism and well reasoned arguments.

Also I'm taking it for granted that the current fiat economic system has been proven beyond any doubt to be a complete and total failure that impoverishes the many for the benefit of a fraudulent few at the top.

It's worth noting that we have just had 100 years of record productivity. New machines and inventions have been created helping to increase the wealth produced over the last century yet people are getting poorer and suffering "austerity." Go figure.

I do not accept the argument that our current Economic system is inevitable or beyond improvement. This current system is nothing more than a sham and a control mechanism for the rich and powerful.

If you can spot flaws or suggest improvements to the plan given above then please comment. That's what this thread is for.

It's worth noting that we have just had 100 years of record productivity. New machines and inventions have been created helping to increase the wealth produced over the last century yet people are getting poorer and suffering "austerity." Go figure.

 

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Do you really think people are poorer than they were a hundred years ago?

There does seem to be a big flaw in this idea, but perhaps you can provide a solution.

Nuclear power plants currently generate a lot of electricity around the world. Some country (the US?) has issued massive cyber attacks against Iran's nuclear power plants, effectively shutting them down for a period, as well as assassinating several of their leading nuclear power experts in recent years.

If money (particularly US dollars as the global reserve currency) was backed by electricity wouldn't it be possible for another country to effectively crash the entire world economy simply by inventing a virus that made it through the firewalls put in place at electricity generators?

Money backed by energy is certainly better than money backed by debt because it's based upon something real rather than a belief that economic growth for future generations will carry the weight of the debt, but it doesn't really solve the problem of corruption, manipulation, warmongering, greed and power grabbing that really lies at the heart of our current crisis. After all, debt based money wouldn't be a problem if it was properly distributed across and between societies, if a more serious effort was put into research and design into sustainable living and if profits didn't buy politicians.

Inflation is Not Natural

The price of everything in our economy seems to slowly rise over time. For example, in 1915 the price of a gallon of milk was $0.36 and today it is over $3.00 per gallon.

Do you really think people are poorer than they were a hundred years ago?

Poverty is relative. It's not a question of what a 'poor' person can buy today or whether they have an improved lifestyle compared to 100 years ago, but rather a question of how large a gap there is between the top 10% and the bottom 10%.

Here are some interesting facts for you:

- Over the period as a whole (1750-2001), prices have risen by around 126 times. Thus one (decimal) penny in 1750 would have had greater purchasing power than a pound in 2001.

- Since 1945 prices have risen in every year with an aggregate rise of almost 24 times. By contrast, prices were lower in 1939 than in 1919.

Check out the chart of changes in retail prices from 1750-2001 on page 18 of this government paper:

http://www.parliament.uk/documents/commons/lib/research/rp2002/rp02-044.pdf

Page 19 has an interesting view on the devaluation of the pound over the same time-scale. It's enough to make your eyes water!!

Poverty is relative. It's not a question of what a 'poor' person can buy today or whether they have an improved lifestyle compared to 100 years ago, but rather a question of how large a gap there is between the top 10% and the bottom 10%.

 

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So it’s more about envy than whether you are poor.

So it’s more about envy than whether you are poor.

Poverty and inequality are essentially the same thing. You don't feel poor unless you're constantly reminded that there is somebody who has more than you. People have lived with very little with great contentment, but introduce someone who has much more and their contentment levels will naturally drop. You're only made to feel poor if there are others around you who have more than you.

Poverty is relative. It's not a question of what a 'poor' person can buy today or whether they have an improved lifestyle compared to 100 years ago, but rather a question of how large a gap there is between the top 10% and the bottom 10%.

Why on earth should anyone care? If I'm twice as rich than I was last year, but someone else is ten times as rich as he was last year, I'm still better off.

The size of the gap is utterly irrelevant to the people on the wrong end of it. The only thing that matters is how well off they are.

Poverty and inequality are essentially the same thing. You don't feel poor unless you're constantly reminded that there is somebody who has more than you. People have lived with very little with great contentment, but introduce someone who has much more and their contentment levels will naturally drop. You're only made to feel poor if there are others around you who have more than you.

That is envy. You're admitting he was right.

That is envy. You're admitting he was right.

Where exactly did I say he was wrong? I was just elaborating for him.

Get off your high horse, you must surely be feeling dizzy up there!!

Where exactly did I say he was wrong?

You claimed that povery and inequality are the same thing, and then explained why they are not remotely the same thing.

Here is a workable solution to the "banking crisis."

 

http://www.energybackedmoney.com

 

This idea was proposed by Thomas Edison all those years ago and I think it has merit as a solution to the worlds financial problems.

 

no it's not.

any sort of commodity backed currency needs a fixed amount of the commodity else you are no better off, there is nothing stopping you doubling or trippling the amount of energy you produce.

if the population were to adopt significant energy saving measures then you could decommission some of your energy generating capability which would mean deflating your economy, perhaps fatally.

it was the attempts to return to the gold standard in the 1920's which forced the uk into recession and then depression.

rightly or wrongly we are stuck with fiat currencies forever. the sort of deflation required to return to any sort of commodity backed currency would make the consequences relating to the possible collapse of the euro look like a party.

if you could find a commodity to avoid that, then all you are doing is locking in the current level of money supply.