Quote: "pretty depressing but yet very entertaining, when they try to justify $125,000,000 bonus for a years work playing(corrupting) the stock market, not producing or contributing to society/economy in any way, priceless"
And just who decides what "contributing to society/economy" is? If you ask an ar-teest, they will swear up and down that they contribute to the economy. If you ask an industrialist such as myself, I would say they don't, but those that mine/drill and manufacture contribute to an economy.
Quote: "He explains reasons for why house prices are so high(in proportion to income), and why it's getting worse."
He's exactly right. The problem is the ability to create money out of thin air. This causes inflation if an equal amount of money isn't drawn from the economy. This appears to be one of the functions of the IRS here in the US. The Fed pumps currency into the economy, and the IRS sucks it out. The problem (of MANY) is that the IRS doesn't remove an equal amount of currency, causing inflation.
Quote: "why people on average are being more and more disenfranchised"
People are "disenfranchised" by their own actions. I have no pity for them. You don't have to take out loans to buy things. It's a thing our grandparents used to do called "saving", "spending intelligently", and "layaways". Of course, this doesn't account for REAL "disenfranchisement" due to gov'ts defecit spending and resulting inflation. Taxation through inflation.
Quote: "I predict in the next 20-30 years people will have intergenerational mortgages, basically your kids will pay the rest of your debts for the family home when you retire."
Can't happen (in the US at least) unless gov't decides that debt can be pushed onto the estate of those who had no hand in assuming said debt. This already happens through things such as welfare, bailouts, &&c; but doesn't happen in the example you gave.
Gov't control of currency is as bad as central banks (Fed, Bank of England, &&c) controlling currency. This is why in the US the gov't was only GRANTED power to COIN gold and silver and to determine the value thereof. I believe I already touched on it here, but will again.
Used-ta-was, once upon a time when We had a Constitutional Federal Republic (three very specific and important words), gov't only COINED gold/silver. An individual or mining company would bring their gold/silver to the mint to have it assayed and minted into coin. The mint either coined it on the spot, or usually, took the metal in return for coin then struck new coin using the metal. There was no way for gov't to just issue coin or create it from thin air; therefore, almost zero inflation.
As for "determining the value thereof"....when the US was getting started back in the late 1700s, MANY types of currencies were in use, most notably the Spanish Milled Dollar (
http://en.wikipedia.org/wiki/Spanish_dollar). Power was GRANTED to the federal gov't to determine values of all these currencies in relation to the new US coin. This power didn't mean the gov't could print a note and say it was worth $1 or $1000.
The final "lock and check" on this system was that States could only make gold and silver coin tender in payment of debts. States could only accept gold/silver as payments for taxes and such, and could only pay their own debts in gold/silver.
Now fast forward to the uh...intelligent...policies and programs (let's copy mainland Europe, that sounds like an excellent idea!) which started to be heavily implemented in the 1930s in the US, and you can see where the root of the problem lies (for the US). Politicians needed to come up with a way to pay for massive social programs, military spending, and other gov't spending. Enter a central bank, fiat currency, and the seizing of privately held gold.
History has proven time and again that these policies, programs, and economic ways can't last. They ultimately bankrupt a nation. Unfortunately, there are too many here in the US who only want to "look Forward" and "Progress". If you don't look at history, you are doomed to repeat it.
Here's a "paper" I wrote one day when considering wealth vs. riches, and what wealth really is.
Thoughts on Wealth
By Nate “Nateholio” Watson
Definition of Wealth
Wealth is a quantifiable tangible item, obtained directly from the earth or sun, with an intrinsic value which does not depend upon the form or condition it takes, and whose existence in society depends on the expenditure of time and/or energy at some point before its existence in society.
Formation of Wealth
Wealth is created when an individual, group of individuals, or corporation expends time, energy, and/or capital to extract a physical resource from the earth or convert natural processes to useful energy.
Wealth formation creates commodities, which may be used as currency or traded in exchange for other commodities, currencies, or services.
Wealth is not created by turning one or more commodities into a product or providing a service in exchange for a commodity.
A commodity which is extracted from the earth may be used as either a de facto or de jeure currency. An example of a commodity which has been used as a de facto currency is when a government coins gold.
Examples of activities which result in the formation of wealth are: farming, extraction of fossil fuel, mining, and fishing. Examples of activities which do not result in the formation of wealth, but are directly related to activities which form wealth are: food processing & packaging, producing petroleum distillates via refining, producing electricity from uranium, producing steel from iron ore, and producing various foods from fish.
Wealth is not formed by producing goods from commodities. A good, such as an automobile, is not wealth, but is rather, a byproduct of wealth. While the automobile may have an arbitrary value, the value of the automobile depends on factors such as its age, condition, and history; however, the commodities from which the automobile is built retain their value, regardless of the same conditions.
Although land may be valued by societies and perceived as wealth, it is not wealth in of itself. The only value land has comes from the possibility of the land to either produce wealth from activities such as farming, or to produce wealth from the extraction of commodities from it. When a piece of land is priced at more than the value of the commodities which may be produced on or extracted from it, that price is artificially inflated by the demand for that land.
Accumulation of Wealth
Wealth may be accumulated by directly extracting it from the earth, or by trading goods and services for it.
The accumulation of goods or property is not the same as the accumulation of wealth, unless such goods or property are commodities themselves.
Reintroduction of Wealth
Once wealth has been used to produce a good and so removed from circulation, it may be reintroduced as wealth by extracting it from such goods and presenting it to markets as a commodity once more. The reintroduction of wealth is not the same as the formation of wealth because the wealth which is being reintroduced has already been formed prior to it's incorporation into a good.
An example of the reintroduction of wealth can be seen when copper wire and tubing is recycled and presented to markets as raw copper metal.
Transformation of Wealth
Wealth may be transformed when it is consumed, and thus destroyed, in order to form another type of wealth.
An example of the transformation of wealth is when electricity is consumed in the process of obtaining gold from the ore which it is contained in.
The transformation of wealth will always produce another form of wealth with a value equal to the wealth which was consumed in forming it.
Multiplication of Wealth
The multiplication of wealth is the process by which wealth is consumed, and so destroyed, in order to form a greater quantity, of the same type of wealth, than was consumed in it's formation.
An example of the multiplication of wealth is when an oil rig uses a portion of the oil it extracts from the earth to provide power for the rig, and thus power to extract more oil from the earth.
Another example of the multiplication of wealth is when a farmer consumes a portion of their crop to sustain themselves as they continue to raise a greater amount of crops than they consumed.
Destruction of Wealth
Wealth is destroyed when it is permanently removed from the market, either intentionally or unintentionally; or when wealth is consumed in the formation of wealth which has a value less than the value of the wealth which was used to form it.
Wealth may be destroyed when a non-renewable commodity such as coal is consumed, or when a non-renewable commodity such as electricity is traded for a service, or a good or item which has no intrinsic value.
Wealth may also be destroyed when it is used to produce items which are utilized by a government or other organization and which are never allowed to be reintroduced into the market.
An example of the intentional destruction of wealth is when a satellite is launched into space, as the satellite is never intended to return to earth without it's destruction in the earth's atmosphere.
Examples of the unintentional destruction of wealth are: the sinking of a ship carrying iron ore or crude oil, or placing items such as electronics into landfills or other methods of disposal.
Related to the subject of this thread...I'd recommend trading some of those worthless fiat notes for copper, silver, and gold bullion. Copper is about $3/lb, silver $28/oz, and gold $1600/oz. There are three other things I'd recommend investing in, but I believe they're inappropriate for this forum...just think what you'd need during a "zombie apocalypse".
In Development: K96 - Combat Simulation
Keep your Hope and Change, I choose individual Liberty!
