The “accident” happens at about the 5-min mark, but you should see the entire video because the woman economist has good points too (and Schiff gets back at the end):

[Via Jack Liberty]




  1. Improbus says:

    @Hyph3n

    What happens if the banks keep all the money? Where did those trillions of dollars of bail out money go? I know I don’t have any extra money in my pocket to cause inflation. How about you?

  2. Hyph3n says:

    Time will tell. If deflationary happens, it will be because China hits a truly rough patch and decides to flood the world with cheap(er) crap.

    Deflation happened in the Great Depression (as I understand it) because we were on the gold standards. It’s unlikely we will be contracting the money supply anytime soon.

    But who knows in this screwy economy.

  3. Uncle Patso says:

    # 32 Hyph3n:
    “Time will tell. If deflationary happens, it will be because China hits a truly rough patch and decides to flood the world with cheap(er) crap.

    Deflation happened in the Great Depression (as I understand it) because we were on the gold standards. It’s unlikely we will be contracting the money supply anytime soon.

    But who knows in this screwy economy.”

    Deflation has already happened. Inflation is when prices go up for the same goods. Deflation is the opposite — prices go down. This is what happened to the real estate market. This is what it means when someone’s mortgage is “under water” — the market value (what people are willing to pay) is now lower than it was, and is in fact less than the debt owed on the property. It is what threw the real estate market under the bus, or it _is_ the bus that hit the real estate market, or something like that.

    Inflation favors borrowers: they owe the same number of dollars, but the money isn’t worth what it was, so their debt effectively decreases. Deflation is hard on borrowers, as their effective debt actually increases. Governments and large corporations like a little inflation because it makes it easier to pay, for example, pensions, which are a form of contractual debt, a promise to pay in the future.

    I like a little deflation every now and then; it tends to make borrowers a little more careful. (I hope.) If you’ve ever known anyone who lived through the Depression, you know what I mean. I don’t know if corporations are capable of learning that lesson though.

    – – – – –

    # 20 Improbus:
    “If you are worried about the future don’t buy gold but a years supply of food for you and the members of your family. You can’t eat gold and if or when the shit hits the fan gold will be worth only what other people are willing to give for it.”

    Just one year’s supply? What then? If the collapse is so severe that you will be unable to obtain food, do you think it will be resolved in just one year? Also, how will you preserve it? MREs are not really good food or very good for you. If you look at the “sell by” or “best if used by” dates on dried, canned and frozen food you’ll find they are at most two years in the future and often less than one year.

    And if the collapse is that bad, what good will gold or silver do? No, the only real long term solution is to learn to live as the Amish do. Raise your own food and fiber, make do without electricity or fossil fuels or energy-intensive chemical fertilizers. The more people who do that, the better off the whole world will be, including the rest of us.

  4. ECA says:

    Inflation is like this…
    In 1970 the cost of MILK/other products was..
    $???
    TODAY the cost of the same goods IS…
    $???

    THEN you compare WAGES..
    1970- $1.60
    1980- $3.10
    1990- $3.80
    2000- $5.15
    2010- $7.25
    ……….. In 40 years Its not even $6.
    In the 70’s you could ALMOST fill a car with groceries(5-6 LARGE PAPER BAGS)..TODAY its closer to $200
    NOW compare TOP WAGES..compare as a differential..NOT percentage.

  5. Hyph3n says:

    #33 Uncle Patso said “Inflation favors borrowers: they owe the same number of dollars, but the money isn’t worth what it was, so their debt effectively decreases.”

    And for this reason, the Government and its corporate sponsors will do everything it can to avoid deflation. The “quantitative easing” or the printing of a butt-load of money was (an attempt to avoid the deflation of the Great Depression.

    It might happen- and with everyone panicked about inflation, I’d be watching for the dark horse– but it will be a bizarre set circumstances outside of our control.

  6. green says:

    Wouldn’t higher interest rates negate any benefit of inflation for borrowers on moneys owed…?

  7. ECA says:

    the fun with INFLATION is WHO has the money.

    The POOR THINK they have more until they Buy something..
    The RICH, BASICALLY, have the SAME, but its like breaking up a NUMBER.. In stead of having $100 dollar bill, you can have 10000 dimes..They can HIDE away more dimes..little by little..insted of trying to HIDE that $100 bill.

    NOW if you get RID of a few dollars, to BRING things back into place..those DIMES become worth MORE and MORE..the POOR couldnt save any DIMES..

    Then comes the fun with the BANKS. They were playing with IMAGINARY MONEY. while it was WORTH PROMISES, it was SOLID. They didnt OWN most of the property, they only collected the INTEREST. As long as the PROMISES were kept, it was fine..but the PROMISE had a bump in it, and it FAILED. and all that Imaginary money, WENT BYE BYE.. So, they cried and got REAL MONEY..

  8. bubba99 says:

    The counter arguement is that easy money and high frequency trading will be able to keep the stock markets inflated. I was watching Citi Corp volumes yesterday and noticed that 2% of a 25 billion share company traded every day.

    The high frequency traders are manipulating the market up and continue to do so as long as the fed is giving them money at effectively 0%. Dont look for that to change anytime soon. The fed will continue to buy 60% of the new treasury debt to keep rates where they are.

    If the scheme fails, it will be a disasterous failure

  9. Improbus says:

    I got out of the stock market (401k) years ago. I have no plans on jumping back in either. It is a giant fleecing machine designed to separate the serfs and their money. If I find an individual company that has potential I will buy the stock for the long term. That day trading crap is for suckers.

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