Re: causes of the depression

Su**** Fish wrote:
> On May 5, 6:52 pm, The Trucker <mik...@[EMAIL PROTECTED]
> wrote:
> 
> 
>>True inflation is caused by declining value of the currency itself.
> 
> 
> inflation caused by excess money supply and credit availability in
> closed loop system for a limited supply of good.

Forget about money supply theory.  There is usually a dire need of more 
money for the goods and services sector which if supplied would not 
increase prices.
> 
> for this reason Paul Volcker tightened hard the money supply and
> credit availability in Carter era (late 70 - 1982) by raising FED
> interest rate very high (around 17%) so consumers couldn't borrow
> money to spend and raised US treasury bill and bond return rate high
> (9% if I recall correctly) to draw money out of the bank saving
> accounts into gov control. With limited monetary quidity,  he tamed
> inflation in a few years, only then he released the money supply to
> help growth.
> 
> I am in line with Mr Volcker, that Fed shouldn't pour money more into
> the system 

The "system" that the fed feeds is the fixed asset economy, not the goods 
and services economy.

It would be great if the Treasury could actually print United States Notes

like it did in 1863, without any central bank or any other kind of bank. 
That's right.  In 1863, by act of Congress, the United States Treasury 
printed money that was spent into circulation by the Government.  No 
interest.  No debt.  No Fed.  No bankers.

That six hundred buck check from the IRS?  It would be a wonderful thing
if 
the government didn't have to BORROW the money.  It would be a wonderful 
thing if the government directly issued the money to us on a per cap
basis.

It wouldn't hurt anybody but the bankers.

Mark M.



to save sub-prime institution because they have to raise
> the interest rate much higher in future to tame inflation. But I am no
> expert, and I didn't take a single economic course in college.
> 
> 
>