Banks robbing people?

[RalliX]

Not sure what you mean or how exactly it would work, but government directly defining the money supply is a bad idea. The reason why there are private banks as the middle man is the ban on direct "printing" money by the government, because that results or at least carries a huge risk of the government just printing all troubles away aka Weimar style hyperinflation.

That doesn't make any sense to me.
It was my understanding that the debt owed by the German government caused the inflation, as they were insolvent, and the marks which they issued meant nothing because of that. The value of that type of currency is based on the government's ability to pay it back, which they could not.

Hitler did exactly as I just described to end the hyperinflation, and subsequently created the strongest economy in Europe within a few years.

The Autobahn was the project, if I recall, and the Nazi government fixed the price of it, then paid the workers with what was essentially paper recognition of their work, which were then used by the workers to do things like buy food. Suddenly the currency was not based on the Government's ability to pay debt to banks or foreign nations, but based on the value of the project.

I'll put it another way.
You could say that working on the project earned you a kind of stock on the project, and people used those little stocks to trade for things. The people own the labour, and they trade their labour for the products of others.

The government defining the money supply is not a bad idea at all, if they don't try to print away their problems.

 

[kurczak]

Ad doesn't make any sense: Well the government is allowed to borrow from the market, therefore any government-central bank transaction has to pass through the market first to "prove" that the there is actual demand for government bonds and the government is not just trying to print away its debt.

Ad Weimar hyperinflation:  well yes, the government was ears deep in its own war debt (like all other participants) and on top of that had to pay reparations. The debt was stipulated in gold-pegged Marks. They didn't have that much money and wouldn't have had anytime soon so they had essentially two options - default (=get annexed) or pay the debt in other gold-pegged currencies. In order to that they suspended the convertibility of the Mark to gold so that they could print as much money as they wanted. With these "free" money they intended to buy Franks and Pounds, which in turn was the proximate cause of the hyperinflation.

Your hypothetical government can get into any kind of debt situation. It might be another (lost) war, it might be just them bribing the voters to vote for them again or anything else.

Ad Hitler: Nope, that's a great myth, Germany under Hitler was on the brink of default when the war started, which is why it started hwhen it did (=sooner than they initially planned). For one thing, Hyperinflation was dealt with by mid 20s and what half-assed support NSDAP had in the hyperinflation times disappeared for 5 years until the Great Depression.

The only thing Hitler really dealt with was unemployment and by very dubious measures - debt-financed public works. This didn't lead to (hyper)inflation because of government price control, which as it always does caused genuine economic calculation impossible and therefore shortages of about anything.

There was no economic miracle under Hitler, just redirection of resources and labor from civilian to military goods so Germany appeared "stronk".

Got the statistics somewhere, too lazy/tired to dig them up now.

 

[FrisianDude]

What or who is a King rebelling against?

Emperor.

 

[Jhessail]

RalliX, what you just wrote about Hitler is completely bogus. As kurczak pointed out, the only economical "miracle" that Hitler made happen was 100% employment and that was done through forcing women to stay home, persecuting certain segments of society and large public-works projects. Germany was in a very bad economical situation in 1939. If there had been no war, Hitler would've had to face a massive public outrage over a tanking economy in a year or two.

 

[RalliX]

Indeed? Oh well.

Still, the kind of currency system I suggested sounds pretty nice to me, at least in theory.

 

[Pharaoh Llandy]

Banks robbing people?

When you put money into a bank, it ceases to become physical money which you own and is reduced down to a mere number on a computer. If the entire network of bank computers were to suffer a massive failure and lose all data, you wouldn't actually have any money because all of the numbers were gone.

Additionally, when you put money into your bank account, they simply give it to other people to spend, whilst replacing your actual money with aforementioned number. So really, the entire banking system is based on thievery.

 

[CryoNomad]

RalliX, what you just wrote about Hitler is completely bogus. As kurczak pointed out, the only economical "miracle" that Hitler made happen was 100% employment and that was done through forcing women to stay home, persecuting certain segments of society and large public-works projects. Germany was in a very bad economical situation in 1939. If there had been no war, Hitler would've had to face a massive public outrage over a tanking economy in a year or two.

Man if that's all we have to do to jumpstart the economy send them back to the kitchens I say! 

 

[Pharaoh Llandy]

Man if that's all we have to do to jumpstart the economy send them back to the kitchens I say! 

Cooking is one of the most awesome, creative, and deadly pastimes known to man, and I for one would relish poisoning everybody I know with undercooked meat and poorly-reheated rice products on a near-daily basis.

 

[Mage246]

Banks robbing people?

When you put money into a bank, it ceases to become physical money which you own and is reduced down to a mere number on a computer. If the entire network of bank computers were to suffer a massive failure and lose all data, you wouldn't actually have any money because all of the numbers were gone.

Additionally, when you put money into your bank account, they simply give it to other people to spend, whilst replacing your actual money with aforementioned number. So really, the entire banking system is based on thievery.

Well said.

 

[FrisianDude]

'cept thieves take your money without your permissions and one usually needs to put money in their bank account before the banks have access to it.

 

[CryoNomad]

Man if that's all we have to do to jumpstart the economy send them back to the kitchens I say! 

Cooking is one of the most awesome, creative, and deadly pastimes known to women, and I for one would relish poisoning everybody I know with undercooked meat and poorly-reheated rice products on a near-daily basis.

Fixed, and I support this endeavor!  The world could use less Englishmen, and for every man down another job becomes available! Win-Win!

 

[Pharaoh Llandy]

'cept thieves take your money without your permissions and one usually needs to put money in their bank account before the banks have access to it.

Which is why I keep all of my valuables in a pillow under my bed. Which just happens to be deep inside a trap-ridden pyramid, buried beneath a mountain of gold upon which I sleep.

Man if that's all we have to do to jumpstart the economy send them back to the kitchens I say! 

Cooking is one of the most awesome, creative, and deadly pastimes known to women, and I for one would relish poisoning everybody I know with undercooked meat and poorly-reheated rice products on a near-daily basis.

Fixed, and I support this endeavor!  The world could use less Englishmen, and for every man down another job becomes available! Win-Win!

English men doesn't actually work. We just get our foreigners to do it all.

 

[FrisianDude]

Must have a hard head to survive such a pillow ahawhawhaw

 

[Pharaoh Llandy]

Yes, my head is quite firm, thank you for enquiring.

 

[InfernoOfAbyss]

Yea, it is creating money out of thin air. Soon the bubble will burst.

 

[Mage246]

Oh look, Chicken Little is back.

 

[Rebel King]

Everybody knew about this scam except me? Lmfao!

 

[Mage246]

It's hardly a scam. We all benefit from it.

 

[Bromden]

With given interest rates of 2-6% and taken 20-30%, the benefit goes mostly to the banks.

 

[Mage246]

In a fixed money supply, there is no difference from the borrower's point of view.