THIS BLOG IS MY BLOG. THIS BLOG IS MY BLOG. Welcome to the Home of Hyperopia.: On Funny Money (Yours and Mine) - Part 2

Wednesday, February 08, 2006

On Funny Money (Yours and Mine) - Part 2

We moved into our new house last week. As soon as I find the box where I stashed Harvey & Eck, the Twelve Days will recommence. But thankfully, I didn't misplace the internet. So I can read words by astute people about important things. For example ...

Back on economics briefly, here are a couple of sentences out of this article from Ron Paul that each person who has a net worth (deficit) denominated in U.S. dollars should ponder. Congressman Paul is writing about the Federal Reserve fiat money system, offering sage observations about the dangers posed thereby.

  1. [New Federal Reserve Chairman Ben] Bernanke's biggest challenge is the challenge of central banking itself: You can control some things, but not everything.
  2. In the Fed's case, it can control the quantity of money or the quality of it, but not both at the same time.

(emphasis mine)

The emphasized clause in item 1 is true. As much of life as central banking, actually.

I actually think the second sentence is not true. The Federal Reserve Bank could control the quantity of money and the quality thereof if they held the quantity of money constant or had some kind of tangible value supporting the quantity of money in circulation.

But of course we are at polar extremes from that kind of discipline. So much so that people commenting on the situation and people passing along commentator's views on the situation overlook that fact.

See you folks in Chile in 2015! Or Singapore, I guess.

Photo credit: here (the Federal Reserve itself!)

5 Comments:

Blogger Erin O'Brien said...

what the eff are you talking about?

11:22 AM, February 08, 2006  
Blogger garrett said...

Funny money (yours and mine).

11:37 AM, February 08, 2006  
Blogger FLAMINGO1 said...

Funny money being dollar bills and such. Since it is not tied to the gold standard, it really has no intrinsic value.

Garrett, I suggest you use one entire room in your new house to store all of your water, dehydrated food products, canned foods and gold bars.

That way, when this house of cards that we call our economy comes crashing down around us, you will be prepared.

(You might want to get guns and plenty of ammo, too).

2:06 PM, February 08, 2006  
Blogger The Velvet Fog said...

That Canadian money is pretty funny. It's PINK! Ha ha ha! Pink money. hoo hoooh errrrherrr.

2:43 PM, February 08, 2006  
Blogger PDD said...

Garrett, what the eff are you talking about?

Fog, you should see people playing monopoly up here... you'd think it were real money. They certainly do.

9:01 AM, February 09, 2006  

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