What is the inherent value of any metal if you are stuck in the desert with no water?
REH From: [email protected] [mailto:[email protected]] On Behalf Of Keith Hudson Sent: Monday, July 12, 2010 2:24 AM To: RE-DESIGNING WORK, INCOME DISTRIBUTION, EDUCATION Subject: Re: [Futurework] Krugman's Insanity, And The Hard Mathematical Truth At 22:12 11/07/2010 -0700, Sanwichman wrote: I agree that deficit spending, as it has evolved, is like a Ponzi scheme. What does denninger mean though, by "real GDP". Usually that term is reserved for nominal GDP deflated by something like the consumer price index. Since there hasn't been much in inflation over the past three years where does the graph get its "-10%" shrinkage rate for real GDP? Is he making up his own private deflater? Doing so would be acceptable, if and only if he presents a rationale for his alternative calculation. Otherwise he is presenting a misleading graph. I agree. I'd like to know where his figure comes from. However, "-10%" seems to me to be much nearer reality than the official figures. There are so many negative items in GDP that, as a measure of "progress", it is pure fiction. I suspect that Denninger may be using something like the gold price as a deflater. However, I doubt this. The price of gold has gone up so much in the last few years that such an attempt would produce nonsense. Besides, what would be the 'market value' baseline? It hasn't had a market value for about a century now because Western governments ever since have tried every trick in the book to de-monetize gold and reduce it to jewellery uses only. (That is, until the last year or so -- see below.) While that argument may have merit, smuggling it in under the pretense of "real GDP" is disingenuous. On the other hand, if he were to make such a deflater explicit, he might be dismissed as a "gold bug". Well, too bad. The onus is on the hard money folks to deal with the prejudices of the great unwashed masses. Marxists don't get a free pass with their labor theory of value so why should hard money advocates be given an exemption from the prejudice of popular delusion? Try buying gold coins to see whether the masses are still prejudiced! You'll have to wait weeks for delivery. Mints in several countries (including the US) are doing overtime to supply demand. And, besides that, even Western central banks are now rumoured to be buying gold instead of trashing its reputation and trying to hold its price down. Even their officials are now as smart as the masses in questioning the future value of paper currencies, particularly the EMU euro and the US dollar. Keith On 7/9/10, Steve Kurtz <[email protected]> wrote: > Mike G will be tempted to call this a Conservative rant. Ad hominem > doesn't refute his argument. > > Steve > > http://market-ticker.denninger.net/archives/2489-Krugmans-Insanity,-And-The- Hard-Mathematical-Truth.html > > _______________________________________________ > Futurework mailing list > [email protected] > https://lists.uwaterloo.ca/mailman/listinfo/futurework > -- Sandwichman _______________________________________________ Futurework mailing list [email protected] https://lists.uwaterloo.ca/mailman/listinfo/futurework Keith Hudson, Saltford, England
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