Moody's Assessment of Overvalued Australian Housing: Local analysts don't know how serious it is; Stark warning bells sound: Australians blind to impending financial Armageddon
Tweet Topic Started: 16 Jul 2013, 09:36 AM (10,588 Views)
But you claimed you could educate me on this! Tell me Michael, how does money that is not issued as debt get issued? Does the RBA print cash and toss it from tall buildings every 3rd full moon?
But I want YOU to explain it to me Mike, since you so graciously offered, implying your greater understanding of the monetary system than me. Up until this point I thought you were a laughably moronic f^ckwit, but I am generously offering you an opportunity to completely change that perception. Impress me Mike, you have my full attention!
You made the statement that " ALL" money supply is created by debt. That is simply not true.
I will grant you the bulk of new money supply is created by debt but not all as you claim. Go away and come bank with the correct answer.
You made the statement that " ALL" money supply is created by debt. That is simply not true.
If it is not true, then tell me how the non-debt money is created. Should be a simple matter for someone like you.
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I will grant you the bulk of new money supply is created by debt but not all as you claim.
Well since I have it mostly right, why don't you complete my knowledge by telling me how the rest of it works.
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Go away and come bank with the correct answer.
I've already tried that and I was unable to find this non-debt money creation you claim exists. Since I am too stupid to find the answer on my own, can't you please just tell me? Come on, don't hold out, I really need the answer to this one!
If it is not true, then tell me how the non-debt money is created. Should be a simple matter for someone like you.
Well since I have it mostly right, why don't you complete my knowledge by telling me how the rest of it works.
I've already tried that and I was unable to find this non-debt money creation you claim exists. Since I am too stupid to find the answer on my own, can't you please just tell me? Come on, don't hold out, I really need the answer to this one!
No you have not tried at all, it is a game you are playing. Go ask a friend, PM someone on the forum who may know the answer, im sure many do. The answer is easily found in about 5 minutes if you bother to look. If you had studied money supply or indeed economics you would know this, perhaps you just forgot or distorted your statement to prove your world view.
I will say it again, NOT all new money supply is created by debt. You have that totally wrong.
I never said you are correct, I said the bulk of new money supply is created by debt you said all so that makes you wrong. If your statement had said most new money supply is created by debt you would offcourse be correct which is not the case.
So either agree your statement about "ALL" money supply is created as debt is wrong, or give me a reputable link which states "ALL" new money supply is created by debt.
No you have not tried at all, it is a game you are playing. Go ask a friend, PM someone on the forum who may know the answer, im sure many do. The answer is easily found in about 5 minutes if you bother to look.
Then why wont you just tell me it???
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If you had studied money supply or indeed economics you would know this, perhaps you just forgot or distorted your statement to prove your world view.
Since you have presumably studied economics or money supply, you actually do know the answer, so tell me already.
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I will say it again, NOT all new money supply is created by debt. You have that totally wrong.
Then how is the non-debt money supply created? Is is a secret?
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I never said you are correct, I said the bulk of new money supply is created by debt you said all so that makes you wrong. If your statement had said most new money supply is created by debt you would offcourse be correct which is not the case.
OK, so you are saying I am wrong. What is the correct answer? The money that is not created by debt, how is it created? Who creates it? How is it distributed to the banking system?
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So either agree your statement about "ALL" money supply is created as debt is wrong, or give me a reputable link which states "ALL" new money supply is created by debt.
Either tell me how the money that is not created by issuing debt is created, or admit you were wrong already. Specifically, this non-debt money, who creates (issues) it? How is it created? Is it cash? How does it get into the banking system without creating a liability? Is there a special type of bank account that pays no interest that some issuer can 'deposit' money into?
What if, it cost 3 pebbles for a haircut and 6 pebbles for a fish? You give the hairdresser 1 fish, and he supplies you with 2 haircuts. No pebbles created or destroyed. When you pay 3 pebbles in interest, you receive nothing in return, so the trade does not balance. If the number of pebbles out on loan is equal to the total number of pebbles, you cannot pay back the loan and the interest through trade, because trade does not change the number of pebbles, it is simply an exchange. Interest is a payment of pebbles, but nothing is received in return, therefore it is NOT trade.
And no, I am not confused. We went through this with lawnmowers 6 months ago. Fiat money has no productive limit, so you can always create more of it (by lending it) to pay back the interest on the money already lent, but that is the ONLY way you can pay back interest in a debt-money system. While it is true that loans repaid destroys money, loan repayments are always reloaned, so that existing debtors can pay back their loans with interest. All of this assumes that the economy will ALWAYS grow. If the economy contracts, the only way to repay interest on loans is to lend money at negative interest rates.
You pay 3 pebbles in interest and the depositor receives it and uses it to pay 3 pebbles for a haircut. The hairdresser does 1 more cut and then has 6 pebbles for a fish. You are the fisherman so you have enough pebbles to pay interest next month and get a haircut. And around and around.
“You Keep Using That Word, I Do Not Think It Means What You Think It Means” - Inigo Montoya
These side debates about the nature of money are getting tedious.
Gen x, lets just accept that you have an Austrian interpretation and others have a different view.
Im not sure its getting us anywhere in particular.
Property acquisition as a topic was almost a national obsession. You couldn't even call it speculation as the buyers all presumed the price of property could only go up. That’s why we use the word obsession. Ordinary people were buying properties for their young children who had not even left school assuming they would not be able to afford property of their own when they left college- Klaus Regling on Ireland. Sound familiar?
The evidence of nearly 40 cycles in house prices for 17 OECD economies since 1970 shows that real house prices typically give up about 70 per cent of their rise in the subsequent fall, and that these falls occur slowly. Morgan Kelly:On the Likely Extent of Falls in Irish House Prices, 2007
The number of people v number of dwelling argument overlooks the reality that many people keep holiday homes empty most of the year, have spare rooms due to empty nesting or are held as bolt holes by foreign investors. The place next to my parents has been vacant – bar occasional annual visits by the owners – for over 25 years.
Whatever you may think about this unused space ( and Pru Goward has announced action for public housing in NSW where there appear to be 35,000 unused bed rooms) the fact remains it is not available.
There seems to be a view that a rental vacancy rate of 2% is soft. Landlord’s have just been used to a market tighter than a fishes bum. The idea that 1 in 20 rental properties is vacant (5%) at any one time is a more reasonable figure. Any other accommodation business aiming for 98% occupancy rates would be considered to be ‘dreaming’.
When calculating the merits of a real estate investment a conservative and reasonable assumption should be that 5% of the time the property will be vacant.
When rental vacancies are in the ball park of 5% then we will be talking about there be sufficient supply and no doubt there will be more appropriate pricing.
But in some ways this is a quibble as we all seem agreed that more housing is required as part of the solution to the current mess.
I should note that having regard to the environment and liveability etc is not inconsistent with an efficient and responsive housing market. However, many preferences that are often personal or ideological get dressed up as environmental or heritage issues. For example I like dense urban environments and love trains but I know that is a personal preference and I have to be careful to avoid adopting rationalisations that make my preferences seem like virtues.
Since you have presumably studied economics or money supply, you actually do know the answer, so tell me already.
Then how is the non-debt money supply created? Is is a secret?
OK, so you are saying I am wrong. What is the correct answer? The money that is not created by debt, how is it created? Who creates it? How is it distributed to the banking system?
Either tell me how the money that is not created by issuing debt is created, or admit you were wrong already. Specifically, this non-debt money, who creates (issues) it? How is it created? Is it cash? How does it get into the banking system without creating a liability? Is there a special type of bank account that pays no interest that some issuer can 'deposit' money into?
If you don't know the answer go and bloody Google it or something or even read a book.
At least try and give me an answer. Or you are demanding is for me to simply give it to you, that is not much fun.
New money supply is not "ALL" debt. This is a bit like the definition of "Holding Costs". You seem to have your own alternate universe.
If you don't know the answer go and bloody Google it or something or even read a book.
At least try and give me an answer. Or you are demanding is for me to simply give it to you, that is not much fun.
New money supply is not "ALL" debt.
As suspected, you don't know how this non debt money is created. I don't see anyone else jumping in to offer up the answer either. Even if you are certain there is non-debt created money, but you don't know how that money is created, you should at least say that.
If you know how this non-debt money is created, who issues it, how it is distributed to either the population as cash or the banking system as a deposit, then simply tell me.
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This is a bit like the definition of "Holding Costs". You seem to have your own alternate universe.
Now now Mike, don't try misdirection. I asked you some very simple questions. If there is non-debt money issued, who issues it? How does it get into general circulation without entering the banking system? If it enters the banking system, how does it do so without becoming a liability?
Veritas
18 Jul 2013, 12:06 AM
These side debates about the nature of money are getting tedious.
This is not a philosophical discussion about what money actually is.
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Gen x, lets just accept that you have an Austrian interpretation and others have a different view.
This is not the Austrian interpretation, it is just how the modern banking system works. The last person in Australia that tried to change that was Jack Lang.
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Im not sure its getting us anywhere in particular.
To understand the current credit crisis, you need to understand how the modern banking system works. Then you can see that the credit crisis will continue until we have negative rates of interest or something equivalent such as a debt jubilee (Steve Keen's proposal). The inflation has already occurred, it just needs to be realised so we can get out of the liquidity trap.
As suspected, you don't know how this non debt money is created. I don't see anyone else jumping in to offer up the answer either. Even if you are certain there is non-debt created money, but you don't know how that money is created, you should at least say that.
If you know how this non-debt money is created, who issues it, how it is distributed to either the population as cash or the banking system as a deposit, then simply tell me.
Now now Mike, don't try misdirection. I asked you some very simple questions. If there is non-debt money issued, who issues it? How does it get into general circulation without entering the banking system? If it enters the banking system, how does it do so without becoming a liability? This is not a philosophical discussion about what money actually is.
This is not the Austrian interpretation, it is just how the modern banking system works. The last person in Australia that tried to change that was Jack Lang.
To understand the current credit crisis, you need to understand how the modern banking system works. Then you can see that the credit crisis will continue until we have negative rates of interest or something equivalent such as a debt jubilee (Steve Keen's proposal). The inflation has already occurred, it just needs to be realised so we can get out of the liquidity trap.
Catweasel say it rather a irrelevant for mouse to understand a modern the monetary system.
Because all a open to different interpret.
So even the understand, all it can follow is a dogma.
So put mouse in even worse the position.
Because it only open to interpret that it can confront without a fear.
Even if mouse enrol in Economics 101,
it not learn this.
And then it have the rascals.
Learn off a internet.
Pack of half understandings.
That fit into what it want to a believe.
Like a MMT.
Perfect for a beer bellies, reactionary and placard.
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