Posted by: graemebird | October 6, 2008

Inflationary Depression Now Inevitable.

More Later.

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Responses

  1. Inflationary depression is contradictions in terms yes Mr Bird? How this work?

  2. During an old-fashioned Austrian fractional-reserve banking-crisis one of the adjustments that needed to be made was while wages and prices needed to fall, many producer goods and investment assets needed to fall further.

    But the goods that needed to fall further tended to be disproportionately those goods that people had borrowed in a disproportionate manner to buy. Since banks, the government, and wall-street welfare queens (aka fractional reserve team B) have shown themselves to be a sort of holy trinity running things…… the group that is in oneness with themselves and against the rest of us…….

    … Since this faction has shown itself able to bendl all policy to its favour, we see that they are not going to put up with these goods falling in price all that much. Since that would mean bank failure and more public stealing. So what they’ll do is steal on a daily basis through wholesale loans and cash creation via buying derivative paper. That is to say they’ll keep further stealing low-key.

    Well what that means is to bring the relative prices in line the asset prices will not be allowed to fall. Hence the consumer prices must rise very quickly in order to make that balance readjust in this alternative fashion. Wages won’t be allowed to fall. Asset prices won’t be allowed to fall. Hence consumer prices and imported producer goods will rise horribly.

    And since the thief Paulson and the thief Bernanke are going AGAINST the market it won’t be just a recession….. It will be far more longer lasting… Therefore it will be a depression. Because it will be both severe and longlasting.

    Now the other thing is that the price system has been subverted. And that therefore many commodities are trading lower than their inventories and the investment demand for them would indicate. Which means that any time there is any sort of recovery, and sometimes when there is not…… there will be a price surge until such time as there is no longer a back-log in taking delivery. These price-surges will be enough to bring any recovery to a crashing halt, even if all other policy is good.

    I’m going to assume that you are Cambria. But just in case you aren’t and are a real Muslim…. It is true enough that the Israelis, along with the Nazi and Soviets, also brought a nasty utopian socialist streak to the area. But surely a bit of forgiveness is long overdue. Especially as your crowd has more to be forgiven for.

    Hardly any Israelis are expansionist any more. I think you’ll find that almost all of them just want peace and security and have very humble goals other than that. Its time to just let them be. They know there is no prospect for them to be expansionist any more. They simply do not have the birthrate for it.

  3. Assalamualikum Mr Bird

    No I am not Cambria. That is insult to my dignity and honour like how you insult my beloved Prophet. This Cambria sounds like an ignorant wop. But thanking you for the explanations anyway. I am free market but Muslim, why insult my faith? I will think more about Israel.

  4. Cambria is in fact an ignorant wop.

  5. Mr Bird,

    I have been reading the papers and I am most concerned with the US. On one hand we have the American Mugabe, friend of terrorists, and the other Mr McCain a man who’s I read has previously been in the business of protecting his cronys in the banking world.

    Its a sad sad world we live in. Is it too late for Ron Paul to take up candidacy on an independent ticket?

  6. Yes Ron is endorsing Chuck Baldwin and asking people to write Chucks name in and not his own. But Ron has more influence now than at any other time. Folks are reacting to him like he was a prophet. The thing to be hopeful about is if he gets enough snap to have the Fed opened up and brought under normal legal behaviour.

    Like today with our bank. Our guy may well have been right to drop the interest 1% in one hit. But really the interest to the banks ought to be 15% or more. So they know its only a backstop and not a subsidy. While they can lend at wholesale prices as opposed to merely retiring debt than the banks are priviledged in this and many other ways. So we ought to be able to get rid of all these subsidies and have a healthy finance system. After having these banks die and be born again and die a second time too perhaps.

    And Ron Paul is relevant to this process now that the crisis has arrived in a way that McCain and Obama are just so unimportant. There was times during Clintons Presidency where he was sort of a co-President. Not really important. And while the banks are in crisis than its Ron Pauls influence that will be more important and no-one will give that much thought to what this old know-nothing or the young social worker has to say.

  7. Still deluding yourself about the old crackpot’s importance I see.

  8. No you are deluding yourself. I never said he was important in the past. The blatant heist has made him very important. He’s showing up on all these mainstream TV shows.

    You’r just ignorant is all. He’s important because this relentless stealing by one allegedly private part of the community is clearly important. But you seem to be too basically idiotic to comprehend this.

    I never described him as important before. He’s important now. I just wanted him to do well in the Presidential race.

    He’s important now. Because people have been made shockingly aware of some of the thieving that goes on.

    Like even the banks getting cut-price funding. THATS THEFT.

    You ought to at least ATTEMPT not to be an ignorant know-nothing the whole damn time Soon. Can’t think? Brain hurting? Don’t know what the fuck is going around you?

    Try harder. Learn to think.

  9. Here’s how far behind the scene you are. How ignorant. Notice that for the first time the monetary sophistication is coming from the hard left. Hence there is a hard-right, hard-left bridge being made on this issue of the relentless stealing of the banking sector. And Ron Paul is really the key figure in this nexus.

  10. here Graeme, I think you’ll like this piece by my boss

    http://www.theaustralian.news.com.au/story/0,25197,24462679-7583,00.html

  11. Mr Soon,

    I will be the first to admit that the program is out and out socialism, but one wonders what Mr Ergas is proposing instead. Given your own predelictions, I fear he would just see the money paid straight into the pockets of millionaire bankers, but for the common good we will be told.

  12. Pray tell Dick, what are these predelictions?

  13. Yeah thanks for that Jason. Your man is always rather good. Certainly he keeps a higher standard than anyone else I see in the Fin or the Australian. But then he’s not Gerry Jackson. And like Richard noted we don’t know what his alternative is. Just getting Macquarie Bank to do everything and shovelling them tonnes of money?

    Clearly we need to think hard about how infrastructure is handled.

    In what will be the next few energy-constrained decades we really want to be scoping out wharves all around the coast. The governments job, as I see it, would be to suss out all the POTENTIAL sites and let people know that these sites are available for homesteading by Australians and by companies where only Australian citizens can own the shares. This is because, for the time being, wharves are strategic assets. And there is no freedom without local sovereignty and there is no such thing as capitalism, properly considered, without freedom.

    In this scoping out of the coast they will come up with a list of unobjectionable POTENTIAL sites that is vastly more numerous than the amount of sites where wharves would ever likely be built in a millenium.

    The foreigners that we invite into this country to do business are not to be government front organisations. They come here to build things, not to buy things (already built) to MAKE stuff not to TAKE stuff…… (ie, not to buy up controlling interests of our natural resources due to current poor homesteading rules and monetary policy).

    To build things not to buy things. To make stuff not to take stuff.

    It is in our interests for us to get foreigners to come here and manufacture things. Employing our people when they do so. Its not in our interests for them to take stuff that they don’t manufacture….. ie natural resources…. by getting into our less than perfect system for allocating leases of natural resources. Yes of course we can use the outsiders technology. But to me thats an outsorcing arrangement. Where its our guys who have secured their stake, and they bring in Chevron, or someone, to do some work for them, not to take ownership.

    The little rhyme makes no sense on its own. It requires expansion and explanation to make any sense at all, but its something to remember in terms of integrating the benefits of trade with the necessity of sovereignty. The little rhyme makes no sense on its own. But it ought to be remembered as a way of jogging ones memory about what IS, and what is NOT, acceptable in terms of our trade policy.

    We do not bring these aliens in to take a controlling interest in our strategic or natural resources. On the other hand we bend all the rules to bring a team of our friends who are foreigners, to commision a new nuclear power station….. commissioned on behalf of Australian interests.

    The little rhyme requires lengthening but its something to remember.

    Any foreigner ought to be able to come to Australia to build literal bridges or wharves and then sell them to Australians. They ought to be able to build factories with their own team of men if the Australians have commissioned the factory. Or build factories if they want to manufacture out of Australia.

    A visa to start a new small business ought to be one of the easiest ways to get into Australia. Or a visa to start a new BIG business for that matter.

    But we don’t bring the Chi-Coms here to buy up all our strategic infrastructure and/or natural resources. We don’t bring in communists to buy our natural resources and infrastructure…. NOT NOW OR EVER.

    We are not a superpower. We are a middle power. And we just don’t do that on account of left-wingers invading into libertarian space with their perverted political correctness.

    We don’t piss away our sovereignty on account of leftists, pretending to be libertarian, and setting up ridiculous anti-free-trade ideas, MASQUERADING as free trade ideas…

    There is a NEW political correctness afoot in the land and its not got anything to do with perverted ideas of free trade being used to piss away our sovereignty that was fought for by people whose views ought likely have precedence over our own.

    Free trade is about private individuals having freedom of access. Its not about having crony-communist bankers and Chi-Com front companies grabbing a controlling interest in everything.

    Those days where this perversion of free trade is put about as phoney right-wing political correctness must be over and for all time.

    We have seen the promoters of such ideas dip their hand a little bit too far lately.

    We must open our doors wide for foreigners to come here so that we have the strongest STARTUP environment in the world without exception. American graduates who have that noble gene and that idealism that makes them want to start a new venture must think of Australia as the Atlantis and El Dorado of startups.

    When new durable capital is being commissioned our immigration department must work overtime since we want our capital investment dollar to go further and we must be the most capital-rich per-capita society in the world.

    So we HAVE to have a lot of foreign involvement.

    But they come here

    To MAKE stuff
    not to TAKE stuff
    To BUILD things.
    Not to BUY things.

    >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
    Maybe we ought to start a new tradition in this country. Oftentimes you see representations at Christmas or other family get togethers, where a family member serving overseas, or yet even one deceased, has the table set for him, and a seat left for him though he is not there for the dinner.

    I think we ought to start a tradition where the unknown soldier gets a seat at the table, and consideration at all our meetings even though he’s not around.

    What did they fight for? How would they feel about the decisions advocated? The decisions agreed on?

    We would not have this country and our independence or its potential thereof, but for these people. And if we are not nihilists surely some sense of what they would have wanted ought be taken into account.

    If you vote Graeme Bird for high office perhaps there will be a seat left for the solidiers of the generations, and a new meeting format to make sure that everyone reflects on what they might have wanted.

  14. Mr Soon,

    My dear lad as Mr Bird has shown on numerous occasions you are an avowed crony capitalist. That is your predeliction.

    Of course Mr Bird makes a good point above, in Australia an infrastructure project is merely code for recapitalising Macquarie bank, so I guess they will take the socialist money either way.

  15. Mr Bird,

    I might add, lots last four lines are quite a stirring slogan for what any free trader should really want with foreign investors. If the investors were merely private players then maybe we could have them come here and do as they please, but we know that they are not. Soveriegn wealth funds in various disguises stalk the world looking for those for whom free trade is a mindless mantra, and pounce, binding them in legalistic webs before slowly sucking the life out of them.

  16. Bird:

    Lets be honest. the package is a good thing as you don’t want to see Main street with too much money. We want to always have joe six-pack under the expensive heels of the Wall street set.

  17. I know that there is the Plebian inside of you Cambria. Your father came here and worked with his hands. He worked hard. And you are the boy made good from somewhat difficult origins and of course I appreciate that. But who was the most productive? You or your dad?

    Or you in your late career or your dad? Or your dads proffession versus your profession prior the the 1970’s and your dads proffession versus your profession after the turn of the century.

    Worth thinking about Cambria. Because there was always a stealing side and a productive side to banking and speculating. Its just that lately the stealing side has really been emphasised.

    These blokes earning hundreds of millions from banking: These are ass-clowns. This is leftist rent-seeking behaviour. Paulsons a fucking knobhead who couldn’t even make it to the top in the normal way but instead launched a rent-seeking palace coup. These fuckers and not bright. They are not the least bit smart. They are political animals like Rudd or that crowd. They are no good. They are not to be thought of alongside the likes of Michael Dell, Stephen Jobs, or the Young John D Rockerfeller.

    These are fucking proven failures. Their failure is manifest. They are both gutless and craven at once. These are not supermen they are wide boys (as the song goes). These are a bunch of subsidised leftist whores and vicious leftist commissars.

    But as a generational thing the Cambria crowd has done well for this country. Just so long as your kids forsake banking (under current laws and conditions) and become business startup artists or something else productive.

    Then you will have a proud place down under. You’ve got to see your stunning existential leap as being merely a stepping stone.

    Because modern banking is stealing and there can be no question about it.

  18. Cambria. Remember in Rocky Four where Balboa says to his kid something like ” I Fight So That You Won’t Have To Fight”

    These guys in your various banking scenarios that you look up to. Speaking in cold sober logic. They were fucking nothing. They were like some faction in the labour party. They were a bunch of know-nothing rent-seekers.

    If you yourself are conflicted with this revelation make sure that you swing to the right side of the argument.

    Repent Cambria.

    Us cultural-Christians BELIEVE in redemption, but its gotta be GENUINE.

    You could start with repenting for supporting the bailout and that would be a very good start.

    Do it for your kids. So that you can tell them the business that you were in was a bit of a racket, but you did a good job of it “considering”, and that you have higher aspirations for them.

    Like when Vito and Michael are talking and they say something like……
    >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

    VITO CORLEONE

    You know he looks more like you every day.

    MICHAEL (smiling)

    He’s smarter than I am. Three years old, he can read the funny papers

    VITO CORLEONE (laughs)

    Read the funny papers —

    (then)

    Oh — well — eh, I want you to arrange to have a telephone man check all the calls that go in

    and out of here — because…

    MICHAEL

    I did it already, Pop.

    VITO CORLEONE

    — ya’know, cuz it could be anyone…

    MICHAEL

    Pop, I took care of that.

    VITO CORLEONE

    Oh, that’s right — I forgot.

    MICHAEL (reaching over, touching his father)

    What’s the matter? What’s bothering you?

    (then, after the Don doesn’t answer)

    I’ll handle it. I told you I can handle it, I’ll handle it.

    VITO CORLEONE (as he stands)

    I knew that Santino was going to have to go through all this. And Fredo — well —

    (then, after he sits besides Michael)

    — Fredo was — well — But I never — I never wanted this for you. I work my whole life, I

    don’t apologize, to take care of my family. And I refused — to be a fool — dancing on the

    string, held by all those — bigshots. I don’t apologize — that’s my life — but I thought that —

    that when it was your time — that — that you would be the one to hold the strings. Senator –

    Corleone. Governor – Corleone, or something…

    MICHAEL

    Another pezzonovante…

    VITO CORLEONE

    Well — this wasn’t enough time, Michael. Wasn’t enough time…

    MICHAEL

    We’ll get there, Pop — we’ll get there…

    VITO CORLEONE

    Uh…

    (then, after kissing Michael on the cheek)

    Now listen — whoever comes to you with this Barzini meeting — he’s the traitor. Don’t forget that.
    >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

    You see. To be honest. You’ve got to see banking for what it is. Under current conditions a subsidized theiving-racket that you work hard within, for the purpose of getting out of and doing something more worthy.

  19. Repent Cambria.

    I’m using all my creative powers to give you an “out” but I just don’t think you are going to take it.

  20. “No I am not Cambria. That is insult to my dignity and honour like how you insult my beloved Prophet. ”

    Well you know. Working on the basis that you may or may not be Cambria……………….

    YEAH MY FUCKING OATH ITS AN INSULT TO YOUR DIGNITY AND HONOUR… if he doesn’t repent.

    So sure I’m sorry. I have my own religious prejudices and I hope that someday we’ll be brothers again.

    I thought you were Cambria….. or someone else….. trying to get me to deny our Israeli friends three times before the rooster crows.

    Thats why I reacted in such a harsh and bigoted fashion. Because I’d never deny our Israeli friends. And there could never be a gotcha moment on that score.

    The rent-seeking leftists lay this sort of thing down just to cut your knee-caps off.

    But I have never given up on our Israeli brothers and sisters.

    Which doesn’t mean I haven’t felt uneasy about things, or had a knot in my stomach about their act from time to time.

    Big Al Mustafa. I sez that you are Cambria in honourable mens clothing.

  21. Bird:
    Perhaps you should tell people that you also worked for a bank.

  22. busted bird, busted fella.

  23. Yeah but I got out.

    Look these people are subsidised thieves. Thats just a fact. Its not free enterprise.

  24. “Graham Bell Says:
    October 8th, 2008 at 11:40 pm
    Everyone:

    Seeking a lower exchange rate for the Australian Dollar might have scored a few political brownie-points way back in ancient history.

    Way back when Australia still manufactured much of its own machinery, spare parts, tools and raw materials [such as steel] …. way back when Australia still made much of its own fertilizer and chemicals …. way back when Australians still owned many of their own productive assets …. way back when oil was so cheap.

    Those happy time have gone forever …. so just get used to it.

    While you’re at it, better get used to the new and very very harsh reality.

    So since most of our ability to make our own production inputs disappeared long ago – in one financial craze or fashion after an other – why on earth would anyone, in their right mind, want to exacerbate the already bad current situation and also demand even more grief fall on themselves by cheering on the attacks on the Australian Dollar??”

    If this were to happen in the context of

    1. Almost no monetary growth
    2. A high reserve asset ratio (at least 40%)

    …Than we could get some of these input producing industries back.

    The thief-economics crowd reckon we ought not get these industries back. For my part I’d want to get them all back and we could let the dollar slide even further, by preventing our banks from borrowing abroad for their liquidity problems, by providing all the cash they need indirectly for everyones liquidity problems, but by preventing the banks from creating new ponzi-money.

    There is nothing more heartbreaking than domestic banks borrowing abroad for liquidity problems. Nothing more nationally stupid. Since the foreigner cannot create the cash thats needed, the foreigner has to indirectly participate in the local scramble for cash. This is one of the very strange problems of socialist fiat money. When there is a scramble for cash we get in more debt and when we expand the money supply we get in more debt. Nothing works but reducing the ponzi-money. Keeping the money supply the same, or perhaps growing very slowly, and replacing the ponzi-money with locally printed cash.

    Now this is part of the reason why our dollar has fallen. Stephens is now doing things pretty right.

    From December to about June he let the money supply collapse. Our banks were borrowing overseas for liquidity. This is always counterproductive nationally. On the other hand borrowing overseas for long-term projects, with the bank as mere intermediary, is fine but it would be better if the debt was demoninated in our own currency. In fact if its a bank to bank thing, while we still have this hateful poxy, socialist, faith-based money we ought to stipulate that bank to bank lending overseas be only long-term and only in AUD.

    That sounds interventionist but its only one of these things that must be recommended while we are planning the phase-out of this poxy fiat-fractional-reserve idiocy.

    If you stop the money supply growth by slowly bringing up the reserve asset ratio, perhaps 1% per week, starting from 3%……….
    …… What you are doing is strengthening the solvency of the banking system and the society WHILE AT THE SAME TIME ATTACKING THE PROFITABILITY OF THE FINANCE SECTOR.

    That means dragging back value to the real economy. A beautiful thing.

    So we want these guys solvent yet unprofitable. And we can open up the field for banking. So any business can have a banking operation. And in transition our regulations would be such that an unprofitable yet highly cashed up bank would simply sell off individual branches and restructure their act.

    Stephens is turning out alright for the time being. He doesn’t understand matters the way I do. But he appears to be a conscientious fellow. A few weeks ago he was looking around for ways and methodologies of cutting off the boom…. this in the middle of the crisis.

    But this is exactly what he needs to find out. Because he needs to flush in the cash, but be able to stop these guys pyramiding too much on that cash.

    My guess is that our lower dollar is a very good thing. In that it may be bank driven. All these banks in the USA bloody-marvellous-Britain and the Bonapartist EU are trying to borrow money for bank liquidity. As I said. This is one of the many boneheaded and self-defeating reactions of socialist money……….

    …. And since we might be one of the few places where our banks are actually REDUCING our overseas bank-to-bank borrowing, I suggest this is a key reason why our dollar has fallen relative to some countries whose banks are now having a harder time of it.

    This theory will be verifiable only in about two months time when the RBA figures come out.

    Its so fucking stupid. We borrow to fund bubbles when the money supply grows fast. And we borrow for bank liquidity (totally futile) when the money supply growth is slow. And in neither case are we borrowing to expand the cash-flow of exporting companies.

    So we just get in more debt all the time and nothing to show for it except the loss of our manufacturing capacity.

  25. Bird:

    You recently took advantage of a home loan from a fractional reserve bank. Should you be officially executed.

  26. No but they should turn over the ownership of the principal to me and thereafter I should split it with the taxpayer.

    So I ought to get off half the debt. And the taxpayer be given the benefit of the other half.

    How we acheive this TECHNICALLY is a different matter. But above what I talk about is justice. We carve the banks assets in half by methods not obstructing the general commerce. And a slowly increasing reserve-asset-ratio is one of those means.


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