If prices had actually been allowed to plummet after the crash of 29 without any government intereference, the economic adjustment would have been much quicker. Without all the controls, subsidies, new taxes and other interference, employment would have been much higher. People would have been earning lower wages, but also paying out less for goods and services. However, the government intereference that leads to these massive downturns is generally followed by more of the same, adding injury to injury.

What it takes is an adaptation which has happened in many countries that have experienced this. Chile, is one example that I’m familiar with.

When inflation was rampant in Chile business contracts which spread over a period of time were written up in a new “currency” which they called UF (short for Unidades de Fomento — or Development Units.) These UF are readjusted on a daily basis, according to a formula which is somewhat similar to the Consumer Price Index.

So if you take out a loan, you express the amount you borrow and your monthly payments in UF and, as long as inflation continues, each payment increases according to the published figures.

You can buy insurance expressed in UF and many other transactions such as property, pension payments, etc. are also conducted using this alternate currency.

I’d be quite surprised if the US does enter into a period of high inflation to not see something similar to this come into play.

Yes, I agree with this excellent description. Deusimplicitus you hit the nail right on the head.

http://en.wikipedia.org/wiki/Kleptocracy

“Of all 36 ways to get out of trouble, the best way is-leave.” -Chinese Proverb

Bye Bye Big Brother- Gone PT- Grandpa

I’ve followed the “conservatives” for a while now, and, from what I’ve learned, they’ll do nothing once they get into office. The “small government” mantra they repeat over and over again is just a line to get you to vote for them. What did they do in 1994? Nothing. If they get elected in November, what will they do? Nothing. The government isn’t getting smaller because the special interests that put these people in office don’t want them cutting certain government programs. Besides, even if we were able to get a “small government”- you still have two giant entitlement programs- Social Security and Medicare. The money required to keep these programs running, and the interest payments on the money we already borrowed will keep our government “big” for years to come. These two entitlement programs will only expand over time, and will really start to take larger and larger chunks of the Federal government’s budget. You’ll never hear a single politician or commentator speak about this, however. All you’ll get is thinly-veiled race-baiting and “class warfare”. Stay tuned, folks!

Like a few of the people who have recognized the path we’ve been on as a nation and the accruing balloon note that will have to be paid, one way or another, the quality of life for the average American is going to dramatically decline in the not too distant future.

The irony will be that this will come as a complete and total shock to millions of Americans who refused, or didn’t have enough intelligence, to look at the clear political and financial reality that was clearly discernible and right in front of their eyes. As long as the gravy train was rolling in the present and handing out loot, they were too complacent to consider the future.

If John Maynard Keynes was alive and well, he would be horrified at what the government has done with the money supply. Dr. Keynes developed his theory of money as a means to offer limited, stop-gap spending by the federal government to ameliorate suffering and preserve capitalism.

It is neither a mistake nor a misunderstanding; It is a crime, the way in which those who currently control the money supply are acting. Criminal acts are being committed that jeopardize the future of America. Allen Greenspan(aka the Prince Of Darkness) turned himself away and betrayed everything that he ever learned from Ayn Rand. As I watched the Prince Of Darkness destroy the dollar as a medium of exchange, I knew that in the end things would turn out badly. Greenspan’s young apprentice, Ben Shalom Bernanke, will finish what the Prince Of Darkness started, and drive us all further down “The Road To Serfdom.”

1. Government (expediently, to buy more time)devalues and ultimatelydestroys its own currency, the lifeblood of every society.

2. Failed governmental economic policies, such as inflation, exhorbitant debt, and rabid dog spending prompt government to seek the “quck fix” of savaging the estate net worth and freedoms (see: victimless criminalization statutes and foreign investment proscriptions) of its own citizenry via the all too often, trumped-up expropriation of corportate and individual property, net worth, and basic freedoms of choice and speech.

When currency value, basic freedoms, and assets are usurped and destroyed, the pertpetrating system of government is foreordained to collapse. The Roman Empire may be the best example of policy excesses and internal corruption leading to inevitable and dramatic downfall, in world history. Our nation, today, shows all the signs of going the same way, especially when you factor rampant corruption and influence-peddling, not just at the top, but throughout the system, into the mix. Short-term patching always has, and always will undermine long-term planning.