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tomandlu

How Many Of These Could You Confidently Explain To Someone?

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Hi - I would do this as a poll, but it only allows 3 questions... I've done them in order of (my subjective) difficulty...

  • What is debt?
  • What is a deficit?
  • What is fractional reserve banking?
  • What is inflation?
  • What is deflation?
  • What is money?
  • Who does a country borrow money from?
  • Where did the lender get the money?

I could manage the first three, 4 and 5 would be shaky (since even these boards can't seem to agree with precise definitions), number 6 starts okay, but quickly degenerates, and 7 and 8 would have me scratching my head, although I have a vague idea...

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Hi - I would do this as a poll, but it only allows 3 questions... I've done them in order of (my subjective) difficulty...

  • What is debt?

  • What is a deficit?

  • What is fractional reserve banking?

  • What is inflation?

  • What is deflation?

  • What is money?

  • Who does a country borrow money from?

  • Where did the lender get the money?

I could manage the first three, 4 and 5 would be shaky (since even these boards can't seem to agree with precise definitions), number 6 starts okay, but quickly degenerates, and 7 and 8 would have me scratching my head, although I have a vague idea...

All of them pretty much.....

However I imagine in this crazy world of ours a great many people would give the answer to 1-6 as wealth.

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OK, I'm going to try and answer the questions as simply as possible and then sit back for a good ear bashing :D

Debt - Something that is owed.

Deficit - The amount by which expenditures or liabilities exceed income or assets.

Fractional reserve banking - A system in which only a fraction of the total deposits managed by a bank must be kept in reserve. The amount of the deposits equals the amount of the reserves times the deposit multiplier (usually about 0.9)

Inflation - The persistent, substantial rise in the general level of prices related to an increase in the volume of money and resulting in the loss of value of currency.

Deflation - A fall in the general price level or a contraction of credit and available money.

Money - A circulating medium of exchange (eg: coins, paper money, etc).

Who does a country borrow money from? - The three primary ways nations do this is to either (1) issue bonds, which are a way to borrow money from its own citizens, (2) borrow from international banking organizations like the World Bank, the International Monetary Fund, or the Asian Development Bank, and (3) borrowing from another nation.

Where did the lender get the money? - They stole it from me!

How did I do ?

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OK, I'm going to try and answer the questions as simply as possible and then sit back for a good ear bashing :D

Debt - Something that is owed.

Deficit - The amount by which expenditures or liabilities exceed income or assets.

Fractional reserve banking - A system in which only a fraction of the total deposits managed by a bank must be kept in reserve. The amount of the deposits equals the amount of the reserves times the deposit multiplier (usually about 0.9)

Inflation - The persistent, substantial rise in the general level of prices related to an increase in the volume of money and resulting in the loss of value of currency.

Deflation - A fall in the general price level or a contraction of credit and available money.

Money - A circulating medium of exchange (eg: coins, paper money, etc).

Who does a country borrow money from? - The three primary ways nations do this is to either (1) issue bonds, which are a way to borrow money from its own citizens, (2) borrow from international banking organizations like the World Bank, the International Monetary Fund, or the Asian Development Bank, and (3) borrowing from another nation.

Where did the lender get the money? - They stole it from me!

How did I do ?

1, 1, 0.5, 0, 0, 0, 1, 0 ;)

(You get the 0.5 for not mentioning the clever bit, and 0 for inflation/deflation since you don't mention that it requires a fixed quantity of physical supply in proportion to the change in the money supply)

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1, 1, 0.5, 0, 0, 0, 1, 0 ;)

(You get the 0.5 for not mentioning the clever bit, and 0 for inflation/deflation since you don't mention that it requires a fixed quantity of physical supply in proportion to the change in the money supply)

I said my answers would be simple, not useful :P

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The "official" definition of money is: a store of value and a medium of exchange.

Obviously, the store of value bit is broken in some currencies.

And fractional reserve banking has morphed over the years. It used to mean a bank retains a fraction of its deposits as reserves and lends out the rest. Now it means that that the banks reserves are a fraction of its deposits, ie it lends out a multiple of its deposits.

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And fractional reserve banking has morphed over the years. It used to mean a bank retains a fraction of its deposits as reserves and lends out the rest. Now it means that that the banks reserves are a fraction of its deposits, ie it lends out a multiple of its deposits.

Isn't that inevitable with FRB? To put it another way, that's the point of it...

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Explaining them is one thing, finding someone who can actually comprehend what you are saying is quite another.

Although us lot on here may not always agree we are quite clued up with what is going 'out there'. However sharing this knowledge with other people is not always easy. I referred to money as 'fiat money' the other day at work and found myself explaining what that was to a guy in his 60's who has invested in all kinds of things over the years.

I've started sharing this video with people and it seems to help them understand why we are currently in the mess we are in. Although it doesn't cover everything is covers the basics in a nice easy understandable fashion and is funny too:-

http://www.youtube.com/watch?v=-AirhUmpNm0&feature=player_embedded

Edited by MrFlibble

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OK, I'm going to try and answer the questions as simply as possible and then sit back for a good ear bashing :D

Debt - Something that is owed.

Deficit - The amount by which expenditures or liabilities exceed income or assets.

Fractional reserve banking - A system in which only a fraction of the total deposits managed by a bank must be kept in reserve. The amount of the deposits equals the amount of the reserves times the deposit multiplier (usually about 0.9)

Inflation - The persistent, substantial rise in the general level of prices related to an increase in the volume of money and resulting in the loss of value of currency.

Deflation - A fall in the general price level or a contraction of credit and available money.

Money - A circulating medium of exchange (eg: coins, paper money, etc).

Who does a country borrow money from? - The three primary ways nations do this is to either (1) issue bonds, which are a way to borrow money from its own citizens, (2) borrow from international banking organizations like the World Bank, the International Monetary Fund, or the Asian Development Bank, and (3) borrowing from another nation.

Where did the lender get the money? - They stole it from me!

How did I do ?

HAM: "Can anyone guess the length of the threads if you started one on each and tried to reach a consensus? "

Now we are going to find out.

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Hi - I would do this as a poll, but it only allows 3 questions... I've done them in order of (my subjective) difficulty...

  • What is debt? - Debt is good.

  • What is a deficit? - A poo

  • What is fractional reserve banking? - Something to do with money and wine

  • What is inflation? - The way Merv gets a girlfriend

  • What is deflation? - Merv's job 30 seconds after inflation

  • What is money? - Something you can swap for coke and hookers

  • Who does a country borrow money from? - It doesn't, it prints it's own

  • Where did the lender get the money? - See above

I could manage the first three, 4 and 5 would be shaky (since even these boards can't seem to agree with precise definitions), number 6 starts okay, but quickly degenerates, and 7 and 8 would have me scratching my head, although I have a vague idea...

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I think that the majority of respondents have answered a slightly different question to the one posed.

They have answered yes to "How many of these do you confidently think you could explain to someone?"

Putting the confidently in the wrong place and leaving out "think" has fatally flawed the poll.

Firstly, explaining anything to someone is hugely affected by the ability of the pupil to understand and, secondly, so many folk think they have far more knowledge and wisdom than they actually do. The confidence arising from that excess of self belief would probably hinder the delivery of a "proper" or correct explanation.

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Can anyone guess the length of the threads if you started one on each and tried to reach a consensus?

Longer than my telomeres

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LABOUR PARTY BRIEFING FOR MP's

Debt:: Something that Margaret Thatcher invented and started.

Deficit: Labour Government's economies to reduce Thatcher's debts.

Fractional Reserve Banking. Savage cuts by present Tory led coalition.

Inflation. Gordon promised not to let this get out of control.

Deflation Lower prices to help hard working famlies

Money. Something hoarded by posh Tories to the detriment of Labour voters.

Where did the country borrow its money? It's the issues that matter. The Labour Government lifted 1 million people out of poverty.

Where did the lender get the money in the first place. Typical question asked by bigoted women.

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Debt - Something that is owed.

Deficit - The amount by which expenditures or liabilities exceed income or assets.

Surely Deficit is just the amount by which expenditures exceed income?

The amount by which liabilities exceed assets is Debt :blink:

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The "official" definition of money is: a store of value and a medium of exchange.

Obviously, the store of value bit is broken in some currencies.

You missed out "a unit of account".

But my favourite "money" quotation comes from one the billionaire geeks in the glory days of Silicon Valley, when they were very rich and still went into work every day - just did it in a Ferrari. One of them (forget which and Cringely's book not to hand) said, "The money is just a way of keeping score."

db

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Debt: Something that you're forced to take out to survive, and spivs get rich speculating in.

Deficit: The opposite of surplus

Fractional Reserve Banking: See deficit

Inflation: House prices can only go up! Helps to create more money - see debt

Deflation: What's 'neg a ti ve equ ity' again?

Money: Created by Debt

Where did the country borrow its money? The future

;)

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  • 284 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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