Solution to America's Debt Crisis: March 2013

Saturday, March 30, 2013

The Secret Reality of How The US Economy Wins And Fails

(Don't know what m0 and m1 are? click here)

(For Source Links on m0, m1, $131T in assets, etc., see this post; the $17T debt link is rounded up)

-WIN-

the m0 can be increased easily by selling over $100T in financial instruments to foreign investment firms for cash to act as American reserves (after the currency is exchanged for dollars)
the m1 can serve investment firms as fuel for their financial investment empire; all they have to do is convert the national debt and/or profits into the 10% reserve for spending over $100T into what is essentially a "pour money into a hole" project.. but then again if foreign investors will honor it as a legitimate financial asset, then I guess it's not bad at all.
the threat of a bank run (everyone cashing their checking accounts) is laughably innocuous, to the point where we're rich off the fact that we're covering the credit defaults of the entire world

-FAIL-

to levy taxes in any kind of way that actually stands a chance of paying off the national debt, the IRS would have to either a) ask the Fed's owners to bring them back lots of cash from selling off their financial instruments or b) just assume that devaluing the global exchange rate of the dollar is basically as good as the same thing. (obviously both of these scenarios are unlikely given the racketeering in politics.)
the Fed could practically effortlessly bankrupt America any time it feels like, just by pouring a ton of money into its financial asset investments, without replacing the reserves (just explained how easy it is to replace m0, but my point is: they don't have to do that if they're assholes)
the average American is COMPLETELY FUCKING CLUELESS as to how the American economy actually works, unless they have a non-libertarian/real understanding of what m0 and m1 are, as well as understanding how their country could be worth $131T in financial assets (the whole thing is completely unreal to them, so they will easily elect anybody that does a shitty, non-existent, or misleading job of explaining it to them)

:PLEASE NOTE:
In this blog post, I use the term "m0", but in reality, it might literally be the MB (monetary base). This is not meant to be misleading, but in the event that you doubt me, please consider this chart proving that in the event of a bank run, there is sufficient reserves to cover the entire m1.

Wednesday, March 27, 2013

Libertarian Belief That Fractional Reserve Banking is Flawed Does Not Reflect Responsible Journalism

(Confusing? See the previous video for part 3(click this link))

The m0 of the United States exceeds the m1, AND the m0 and m1 are almost identical (~$2.7T : $2.42T is a 112% reserve ratio! This shows it a little more clearly.)
The total financial asset value of the United States is $131T. We are a RICH, RICH nation. If there's a country on this entire planet where it makes sense for the citizens to have no poverty or economic deficiencies, it's definitely the United States.
Here is an example of misinformation by Libertarian sources. It's about Ron Paul claiming that the Federal Reserve has destroyed 98% of the value of the dollar since 1913. This calculation holds no merit whatsoever, and is a blatant misinterpretation of this source of information by leaving out the fact that people historically were earning less and less money the farther back in time you go. (for instance- in 1933 the minimum wage was less than a thirtieth of what it is today, which is completely ignored when claiming that this is 'evidence' of the destruction of the purchasing power of the dollar.) In fact- since 1913, the dollar buys things that people in 1913 could never have dreamed of: cell-phones, sex toys, video games, computers, affordable GPS technology for their tractors, etc. The likelihood of someone being able to afford a 12 dollar steak dinner in 2013 matches the likelihood of a person in 1920 being able to afford a 1 dollar steak, which is really what it boils down to- the reality of all the context that governs one time period's citizens' financial standings vs that of the present era.
YES- Conspiracy theory is REAL. Here is what I would show anyone, regardless of whether or not they believe or disbelieve, in order to prove beyond reasonable doubt that conspiracy theory is definitely legitimate. But if people are becoming conspiracy theory empathists because of Ron Paul (cough Tila Tequila), then we all end up looking like a bunch of bigoted buffoons. Conspiracy theory should be removed from a political party affiliation, in my opinion, simply because it's about good journalism. Journalists should always select the parts of any political ideology that are correct, and abstain from any loss of their sense of humor and political flexibility. In short- indoctrination and journalism do not and should not go hand in hand as they do when it comes to libertarianism and conspiracy theory journalism.

Update: OK technically the version of 'm0' that I'm using is actually "monetary base", but it's not like federal reserve deposits aren't reserves that actually back the m1 or anything. It's just a technicality, and it only confuses things if you're approaching the question from how you'd learn about it as a student.

My wall of shame for various libertarian blogs that are spouting complete bullshit lies and propaganda (will update this on a continual basis, but keep in mind that it's too depressing to find these jewels of insanity on reddit "buried" amongst the top comments on all the most ignorant sub-reddits):

This ignorant fool thinks that somehow $32B is backing $7.4T (I have no idea wtf kinda evidence there is for that, but I know the article does not explain it at all.)
This example of propaganda shows how m0 and m1 are confused for the federal deficit in relation to america's financial assets. The 1:9 ratio does not show up in the actual m0 and m1 values at all, but these people don't care and think they know everything about how "fractional reserve banking is insanity".
Here is another example of propaganda claiming that the present day economy's money is worthless in comparison to the money of the past. The incomes of the people living in 1913 are never mentioned, so you're forced to assume that people in 1913 must've been getting EXTREMELY cheap prices on things, as if opening your wallet in today's economy is the same as opening your wallet in a 1913 economy. People in 1913 didn't have money in their wallets, and if they did, it was a direct reflection of the CPI for that era, as would be normally translated by what you'd expect as rational in today's economy.
This example shows the "truth" that Libertarians want to believe. It's completely misleading and does not reflect any actual understanding of what m0 and m1 actually are.

Monday, March 25, 2013

3% Reduction in int'l Exchange Rate of USD Generates $3.93T, Eliminates All Taxes

The United States has 131 trillion dollars worth of financial assets. A 3% dollar exchange rate devaluation is therefore worth $3.93T. It's a perfectly legitimate way for the IRS to levy revenue for the government, that makes income taxes obsolete. People would keep on average 22% more income.

The purpose of the government's revenue should be to manage charity in order to promote an economy where people don't have to use money. This leaves the question: why would people choose to work if they don't have to? The incentive is: people who work get a much higher quality of life because they will be much more likely to actually have money.