The FED Caused the Great Depression

It is now, but it certainly hasn't always been that way since the creation of the FED.

 

The Dust Bowl didn't start until 1930. However, you are correct that farmers had been getting racked since then becuase the Fed created the Agricultural Depression of 1920-1921.

Correct. Devaluation of the dollar by the Fed destroyed the purchasing power of savings, and so more consumers had to rely on credit to finance their spending rather than relying on their savings. Excessive credit was made easily available by the Federal Reserve setting interest rates.

This is an effect of the GD, not a cause.

Easy credit set by the Fed, in both cases. High prices were purely speculative and based entirely on fantasy. Stock buyers were able to purchase stock at only 10% becuase they were able to borrow the other 90% from their stockbrokers, who borrowed it from the banks, who got the money from the Federal Reserve.

The banking crisis was caused due to the inevitable contraction of credit that was created artificially by the Federal Reserve System. It's an inherent flaw with a fractional reserve banking system. You can't loan out money while at the same time promising the depositor that he can retrieve his money anytime he wants.

Simply repeating your claim that we had laissez faire economics does not mean that we had laissez faire economics. The cental bank is a form of central economic planning. Herbert Hoover launched a ton of government programs at the onset of the Depression in an attempt to move wages higher, to boost prices, bail out failing businesses and banks, guarantee home loans, protect depositers,
stimulate construction, and providing public works. That is NOT laissez faire capitalism. Any rational individual would agree.

I did. They didn't rebut anything I said.

Gain some understanding? I think I have a better understanding of the causes of the Great Depression than you do. Your understanding is elementary at best.

No. It has nothing to do with Democrat vs. Republican. I have consistently slammed members of both parties as being Collectivist and pro-big government. I have never made any such claim that only Democrats are to blame. You're just trying to turn this into a partisan discussion for some reason. Get off it.

Already disproven. See above.

You just completely ignored what I said about what the true goals of the creation of the Federal Reserve System were. Vanderlipp, Aldrich, Warburg, Piatt Andrew, Davison, Strong, and Norton....the men who created the Fed, would disagree with you.

The Fed is a form of regulation. What don't you understand?

House negotiated the secret agreement to intentionally get the Lusitania sunk as an excuse for the US to enter WWI. That alone sounds pretty evil to me. Not only that, but he was hellbent on world government.

 

That's completely untrue. Bank loans are a wash. That doesn't "create" money. It creates debt that needs to be paid back to banks. When the Government spends, it creates money that needs to be paid back to the Government. But the Government is us, so we really don't need to pay ourselves back unless we want to be poor. The Fed never loans directly to the Govt... since it is against the law.

 

So I take you don't believe in Marx and therefore you think blacks should be slaves since TJ had black slaves.

What a silly thing to say.

 

These questions are fundamental to the issue!In a gold standard it was borrowing. In a fiat standard it is relinquishing purchasing power. You are giving up $10,000 for the next 30 years. It plays a role in how much the Govt should spend, but the Govt does not take that money, put it in an account and then spend it. It doesn't need your money to spend money. It's a balancing act to control inflation. That is it.[/QUOTE]

Why are you dodging my questions? Because they annoy you because they show the fault an inconsistency of your positions.

The truth is sometimes difficult to accept when it is inconsistent with stubbornly held beliefs no matter how wrong.

You non answer exposes why it is useless to talk about bigger macro issues without building a fundamental basis of understanding.

Your blather is meaningless to me because you cannot answer simple, basic questions about you view on how things work, which you also cannot support with credible sources.

If you cannot answer basic questions, why should I or anyone put any weight in your view?

 

What correlation?

In the 1970s, we had a relative debt decrease and an average economy.

During the Reagan/Bush era, we had high relative debt increases and an average economy.

In the 1990s, we had a significant relative debt decrease and a very strong economy.

In the 2000s, we had a high relative debt increase and a subpar economy.

There is no correlation at all.

Does that ring any bells?

 

Austrian revisionist history.

Hoover did almost nothing for 3 years while the economy continued done its recessionary death spiral.

Until then, Hoover followed policies of repatriating immigrants, protective tarrifs, no money injection, and low taxes. (Sound familiar?) These policies did nothing to stop the recessionary spiral but arguably hastened it.

It wasn't until 1932, facing re-election, when over 20% of the economy was already destroyed, that he started taking steps to intervene. They helped as by 1933 (along with FDRs election and implementation of the New Deal) the economy stopped tanking and began to turn around.

http://en.wikipedia.org/wiki/Herbert_Hoover
But it was way too little, way to late.

We can thank Paulson, Bernanke, Geithner, Bush Obama and the Democrats that we didn't have a repeat.

 

The Govt does not owe to "us" unless "us" includes China.

 

So, you can't prove your assertion - again.

 

Lol, are you sure a 1,400% jump in debt and GDP in the span of 30 years isn't highly correlated?? Lol

 

What are you talking about? Jefferson hated the institution of slavery, and sought its destruction from the beginnings of the country.

Jefferson originally penned the following in the first draft of the Declaration of Independence, but it was later taken out so as not to "make waves" with slave areas. The Declaration (in case you never read it) states many reasons to rebel against the King of Great Britain, or many reasons for America to declare its independence.

As President, Jefferson quickly signed an act prohibiting the importation of "new" slaves from foreign lands. Jefferson was against slavery.

Now let’s contrast that position with people wanting ever increasing tax rates designed to confiscate one's productivity up to, and possible exceeding 94% like FDR did in 1944. We don't know how much of a person's productive life YOU would take by force because you won't tell us.

You won't answer the following questions...

1. Do you pay (and/or donate) 91% of your income in taxes (and donations)? If you don't, and expect nameless others to do so, you are by definition a hypocrite. Definition available AGAIN on request

2. IF YOU were Dictator of the Unites States, what would be your Communist tax structure? How much income of Americans would you TAKE at the point-of-a-gun to fund your own mental machinations?​

Well tell us, do you support 91% (or higher) of a person’s productivity taken away at the point of a gun for others to spend? What tax rates would YOU SUBJECT others to if YOU had such POWER? Your answer will show how much YOU believe in slavery, and the destruction of individual liberty.

The Left are all such hypocrites!

 

Again, your charts are deceiving because you are not adjusting the data for time scale. Data charts look like that over time because the greater numbers at the end make the smaller numbers at the beginning. A chart of the Dow since before the great depression to today makes the '29 crash look like a blip. You would have to use logarithmic charts instead.

This chart below I compiled plots the % chng of GDP (blue) against the % change of the ratio of Debt to GDP. When the blue line is up, the economy is growing. When the orange line is up, the relative size of the debt to the economy is growing.

If there was a correlation between the growth of debt and GDP as you are insinuating from your charts, we should see the blue and orange lines moving together. That would indicate a growth of debt correlates with a growth of GDP.



I don't see a correlation. It anything, there is a negative correlation. The debt tends to be growing higher when the economy is contracting.

 

Depends on a lot of factors.

Why not?

quote]1. Do you pay (and/or donate) 91% of your income in taxes (and donations)?
[/quote]

Nope, do you?

LOL

Depends on incomes and the state of the economy. Do I get to control spending too? If so I'd have a progressive scale topping out at about 40%.

Though in a situation like now, where irresponsible hypocrites like you have elected panderers over and over who have ran up trillions in debt and (*)(*)(*)(*)ed over the economy, it would need to be higher on the top end until the relative debt was decreased.

LOL says the hypocrites who claim to be so concerned about deficits while they slash revenues and run up trillions in debt.


The Right are all such hypocrites!

 

Born into a prominent planter family, Jefferson owned hundreds of slaves throughout his life; he held views on the racial inferiority of Africans common for this period in time.

http://en.wikipedia.org/wiki/Thomas_Jefferson



So explain to us why you think blacks are inferior and should be slaves. Racist.

 

Austrian revisionist history? You only think so becuase your definition of "laissez-faire capitalism" is wrong.

http://en.wikipedia.org/wiki/Laissez_faire

The Federal Reserve Act is a banking cartel agreement that was passed into law. It's an enforced monopoly through state intervention. A central bank controlling interest rates and the supply of money is a form of regulation. America had an income tax since 1913.

Low income taxes are not laissez faire. No income taxes would be laissez faire. Tariffs are not laissez faire. Notariffs are laissez faire. Repatriating immigrants is not an economic issue.

Even Hoover doing nothing for 3 years does not mean we had laissez faire capitalism. You can have the machines of central economic planning continuing to roll as the President does nothing to interfere with it, which is what happened under Hoover. If Hoover really were a laissez faire capitalist, he would have moved to abolish the Fed and let the market take over.

The Fed chairman and two CFR members - one, a former CEO of Goldman Sachs; and the other, the US governor of the IMF and former President of the Fed Bank of NYC. Nope, no corruption there. Thank God for them, the have only the best of intentions for the people in mind. This statement reveals you really do worship the elite ruling class.

I seem to recall most Republicans voting for the bailouts. But that is beside the point. It's already been established that both political parties are essentially controlled by the C.F.R., which is why there is no meaningful difference between the policies of both parties. Your attempt to make it partisan is highly irrational and simply not based in reality.

The Fed's loose credit and money creation is what caused the recession in the first place. The only thing which can prevent recession are labor and the market. You're living in a fantasy world if you think that excessively low interest rates, printing money and government spending can stimulate the economy in anyway other than a temprorary artifically created boom. (In fact, the Housing market and unemployment have hit Depression levels in the past 2 years.) These exact policies are what caused the recession in the first place. I find it humorous that you think that the solution to the problem is to implement more of the same policies which caused the problem in the first place. Doing more of the same will lead to an even bigger bust down the road.

 

Ah yea, and he was STILL against slavery. If he were PRO slavery he would not have stopped the importation of slaves! Lots of really stupid inferior people are entitled to individual liberty. That's the way I feel...

 

What definition of laissez-faire?

My post did not have the word laissez-faire in it.

In fact, I'm not even sure how to spell "laissez-faire"

How did a French word enter our economic jargon anyway?

Wasn't it the French who said "Let them eat cake?"

 

Oh no ---

So which is it? You think black girls should be your slaves and forced to have sex with you, or are you a communist?

 

You referenced my post claiming that we were not a laissez-faire system as "Austrian revisionist history" and proceeded to explain why Hoover did "nothing" for the first 3 years of the Depression, as if to debunk my claim that we were not a laissez-faire system. However, I explained to you why you are wrong about Hoover doing nothing, becuase he allowed the Fed to continue their central economic destruction of the economy.

Now how about taking a second swing at my last post? This time actually try debunking what I said. I dare you.

 

Do you realize how idiotic that is? Jefferson owned slaves. While he did often decry slavery in theory, in practice HE OWNED SLAVES. It would be like me writing about how terrible murder is, while being a serial killer. If he truly opposed slavery, he would have freed his slaves. However, he constantly talked about how he wanted to free his slaves, but could not afford to do so financially(if you don't know, Jefferson was a terrible businessman). That is not a principled stance against slavery.


PS. On top of that, Jeffersons greatest objection to slavery was not that people were owned, but that he felt slavery was bad for white society. That white slave owners were morally inferior to non-slave owners, because white farmers had to work for their living, instead of just watching others do it for them. And Jefferson was a proponent of the yeoman farmer ideal, which he believed created the most moral society possible. Slavery does not fit into that model.

 

OK, I see where you had used the phrase.

This was the part of your post to which mine addressed.

As my post demonstrated, the bulk of such programs to the extent he did them were in 1932, 3 years into the great depression. Too little too late, though they arguably did help the economy start to turn around in 1933.

Hoover was a hands off president who didn't support mandatory programs or support for individuals. He was much more "laissez-faire" in his approach.

 

But the GD was not caused by laissez-faire capitalism. It was the Fed, which is the largest step away from laissez faire as you can get. Government intervention caused the Depression and government intervention prolonged the Depression.

 

zzzzzzzzzzzzz

 

Part 1,

The sever dust storms brining severe drought in the Great Plains began to have an affect as early as 1921, then of course came the Dust Bowl we all know.

As for devaluation of the dollar, I’d to se your sources on that.

Job loss and increased poverty was climbing long before the GD; speculation (bad money) was in vogue by then and stock prices were being artificially valued up: just like 2007. The fed didn’t set easy credit for the “easy credit” for the consumer, Wall Street did that; I answer later that the original design of that policy was to support the British Pound. Wall Street just found an easy in to free money; just like in the savings and loan scandal and the sub prime mortgage scandal. Your “fractional reserve argument sounds good, but it doesn’t jive with what actually happened. In your proof, it notes that the Fed raised and then lowered interest rates to help the European system, and that goes along with what I’m saying (see below). You may also wish to check here:

http://www.uiowa.edu/ifdebook/ebook2/contents/part5-V.shtml

The restating of laizze-faire economics with multiple independent sources says exactly what I’m arguing: we had laizze-faire economics in ever case before we ran into trouble, and my proofs did indeed refute what you were saying. Multiple proofs are used to do just that. It then becomes your opinion against multiple and credible sources as examples of why you’re wrong. And suggest that my understanding of the GD are some how n rudimentary to yours only shows your weakness in validating what you’re trying to argue: you have not successfully refuted anything I’ve said.

If I have in some way misinterpreted your politics, I apologize. Your arguments however lead one to believe that you have a conservative bent; not extreme, but there nonetheless.

As for laissez-fiare as an economic policy, my proofs show you to wrong. Here’s another one: http://www.austincc.edu/lpatrick/his1302/crash.html

More in part 2

 

Your logic is faulty, but that is noting new. Jefferson did not think "black girls should be... (his) slaves and forced to have sex with..." him either! You DO feel you and your kind should be able to steal just as much of a person's productivity as you wish, to spend on what YOU want. How does that differ from slavery, tyranny, and communism? How is such a view LEGITIMATE in the United States, in this time?