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Deflation’s On Its Way!?

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My brother in law is a carpenter, the last few years have been good due to the booming construction industry but recently things have tailed off in that industry he’s still working but he and his collogues are now working for 20-30% less.

Banks are in serious trouble, writing off bad debts and heavily restricting new loans, thus reducing the money available to the economy.

The government is running short of money as tax revenues are generally declining.

Surely all this points to deflation, I’m aware that deflation will be disastrous for those heavily in debt but I can’t see a way around this; theoretically the government could just start ‘printing’ new money into existence but that would show such desperation that I don’t think they would dare…

Save your cash!

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My brother in law is a carpenter, the last few years have been good due to the booming construction industry but recently things have tailed off in that industry he’s still working but he and his collogues are now working for 20-30% less.

Banks are in serious trouble, writing off bad debts and heavily restricting new loans, thus reducing the money available to the economy.

The government is running short of money as tax revenues are generally declining.

Surely all this points to deflation, I’m aware that deflation will be disastrous for those heavily in debt but I can’t see a way around this; theoretically the government could just start ‘printing’ new money into existence but that would show such desperation that I don’t think they would dare…

Save your cash!

Common sense would strongly suggest that when cash, confidence and credit gets removed from the system the bubble: deflates.

At the first whiff of inflation morphing into deflation some interesting things will happen. Inflation hedges will crash overnight and house prices may revert back to below the previous bottom.

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Credit hyperdeflation, monetary hyperinflation - superduperhyperstagflation.

Credit still isn't money.

"Money is an obligation to repay a debt." Tautologous Tim

Debt is a credit owed to someone else.

You know it makes sense.

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"Money is an obligation to repay a debt." Tautologous Tim

Debt is a credit owed to someone else.

You know it makes sense.

Money is a medium of exchange.

Credit serves in a boom because it's a bank counterfeiting legal tender by pretending to have some when they don't. (Although "some" is way short of what they have done this time.)

In a bust, ultimately only legal tender will do.

As always, in a bust people stop accepting the lies of bankers and want what they consider to be "real money" instead. This means bank runs and the ruin of the system.

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Money is a medium of exchange.

Credit serves in a boom because it's a bank counterfeiting legal tender by pretending to have some when they don't. (Although "some" is way short of what they have done this time.)

In a bust, ultimately only legal tender will do.

As always, in a bust people stop accepting the lies of bankers and want what they consider to be "real money" instead. This means bank runs and the ruin of the system.

You’re wrong here – what banks do when issuing credit (even if it is not physical money) is secure the product of future labour. Money is a token of labour. It is all ultimately about a promise in the future; we give you the ability to have X and in exchange you will give us Y from future production, be that what it may.

The money / credit debate is incidental, you miss a trick by getting hung up on the ‘credit isn’t money’ debate. Credit AND money are just a token for labour, both past and present.

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You’re wrong here – what banks do when issuing credit (even if it is not physical money) is secure the product of future labour. Money is a token of labour. It is all ultimately about a promise in the future; we give you the ability to have X and in exchange you will give us Y from future production, be that what it may.

The money / credit debate is incidental, you miss a trick by getting hung up on the ‘credit isn’t money’ debate. Credit AND money are just a token for labour, both past and present.

Nope.

Money is a medium of exchange.

if I swap goats fot cows by using weasels as a middle step, then weasels are money.

Most people think that legal tender is money - that's what they accept as medium of exchange on a daily basis, and that is what the commercial banks pretend to have. When they stop accepting the banks lies and assurances and want legal tender instead, the banks are knackered and runs occur.

The banks are trapped by their own confidence trick.

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Guys guys, please, just one practical question if I may:-

Do I buy more gold or not?

My thxs

(she retreats into a corner, & waits until the danger has subsided)

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Nope.

Money is a medium of exchange.

if I swap goats fot cows by using weasels as a middle step, then weasels are money.

Most people think that legal tender is money - that's what they accept as medium of exchange on a daily basis, and that is what the commercial banks pretend to have. When they stop accepting the banks lies and assurances and want legal tender instead, the banks are knackered and runs occur.

The banks are trapped by their own confidence trick.

Yes, money is a medium exchange, but for what? When you go to work, what are you exchanging for money? Labour, or for credit / debt, the promise of action in the future.

Your view of legal tender / trust is a tad too simplistic. What happens during the collapse of a currency is a collapse of trust. If you no longer trust that someone will take your hard-earned in return for some other goods or services, then you in turn are unwilling to exchange your labour for that token of exchange. You are viewing money in too simpler terms.

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Once even the conman believes it to be true, isn't the argument irrelevant?

This is the amusing thing (for me at least) the bankers own beliefs are completely unimportant - it's the beliefs of the average depositor that matter most.

Most folks think that the banks have their cash in a vault, waiting for them. Most people think that there is a legal tender banknote behind every electronic presentation or accounting statement. Some (probably a sizable minority) still think that money is backed by gold!

Without this misconception, banking could not exist.

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This is the amusing thing (for me at least) the bankers own beliefs are completely unimportant - it's the beliefs of the average depositor that matter most.

Most folks think that the banks have their cash in a vault, waiting for them. Most people think that there is a legal tender banknote behind every electronic presentation or accounting statement. Some (probably a sizable minority) still think that money is backed by gold!

Without this misconception, banking could not exist.

Massive generalisation there mate, and again you are not asking the fundamental question – what is the purpose of money?

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Yes, money is a medium exchange, but for what? When you go to work, what are you exchanging for money? Labour, or for credit / debt, the promise of action in the future.

Your view of legal tender / trust is a tad too simplistic. What happens during the collapse of a currency is a collapse of trust. If you no longer trust that someone will take your hard-earned in return for some other goods or services, then you in turn are unwilling to exchange your labour for that token of exchange. You are viewing money in too simpler terms.

This isn't a currency collapse, although it will be turned into that by the actions of King and Bernanke et al.

It's a banking collapse. Bankers simply pretend to have money they do not and most people fall for it.

There is no reason to trust the bankers because they are lying scumbags. One doesn't need trust if the other person is doing what they say they will do because any doubts can be disproven easily.

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Massive generalisation there mate, and again you are not asking the fundamental question – what is the purpose of money?

I'm not asking what the purpose of money is, I am identifying what most people think of money as.

The prupose of money is entirely different for each and every human being on earth, because it is (like all goods) given a completely different subjective value by each individual.

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I'm not asking what the purpose of money is, I am identifying what most people think of money as.

The prupose of money is entirely different for each and every human being on earth, because it is (like all goods) given a completely different subjective value by each individual.

You're still missing the point - credit/a medium of exchange (aka Money) simply represents an IOU for future labour, goods or materiel.

The alternative is direct bartering but under such a system our modern society couldn't exist. We'd be reduced to bartering food for goods.

Thus the need for a standardised medium of exchange - and it has been recognised by pretty much all civilisations for the thousands of years of recorded human history.

The problem here is that the banks have effectively misused their position to issue more credit than can ever be realised as goods and labour.

Now, either we allow them to fail or we monetize the losses and thus completely destroy any credibility that the medium of exchange (fiat money) has. Without credibility of money, the whole system will fail.

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This isn't a currency collapse, although it will be turned into that by the actions of King and Bernanke et al.

It's a banking collapse. Bankers simply pretend to have money they do not and most people fall for it.

There is no reason to trust the bankers because they are lying scumbags. One doesn't need trust if the other person is doing what they say they will do because any doubts can be disproven easily.

Yes yes yes, but SO WHAT? Stop dancing around the issue and answer some direct questions.

You have stated that banks will collapse because ‘they pretend to have money that they don’t have’, but so what? What does that mean? If you don’t know what money is in the first place, then how can you even begin to speculate the effects of banks lying etc?

I’m no fan of banks etc, but what you are saying lacks any in-depth analysis at all, and just repeatedly bangs on with the ‘money as legal tender’ gibberish. But what is legal tender? What is credit? What is money used for? What does it represent? I suggest you have a little think about this before posting again on the topic.

And for the bit in bold; you make no allowances for future promise – your idea of self-evidence only works if the exchange happens in real time. What if I give you 3 goats now in exchange for 100 kgs of your future winter vegetables? How does trust not come in to that equation?

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You're still missing the point - credit/a medium of exchange (aka Money) simply represents an IOU for future labour, goods or materiel.

The alternative is direct bartering but under such a system our modern society couldn't exist. We'd be reduced to bartering food for goods.

Thus the need for a standardised medium of exchange - and it has been recognised by pretty much all civilisations for the thousands of years of recorded human history.

The problem here is that the banks have effectively misused their position to issue more credit than can ever be realised as goods and labour.

Now, either we allow them to fail or we monetize the losses and thus completely destroy any credibility that the medium of exchange (fiat money) has. Without credibility of money, the whole system will fail.

Thank FUUCK someone has got a brain around here.

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You're still missing the point - credit/a medium of exchange (aka Money) simply represents an IOU for future labour, goods or materiel.

No, it represent a unit of legal tender, which isn't a unit of labour, it is a toekn you have to give to the government so they will not assault you and steall all your stuff. it entitles you to some peace and quiet.

The alternative is direct bartering but under such a system our modern society couldn't exist. We'd be reduced to bartering food for goods.

no, a new money system would arrive via market forces. Money is the most bartered good in a free market. (Always reverts throughout history to gold and silver is left to it's won devices.)

Thus the need for a standardised medium of exchange - and it has been recognised by pretty much all civilisations for the thousands of years of recorded human history.

It's self organising as all chaotic systems are and needs no outside help. There is no need whatseover for a standardised unit of anything. People are more than capable of making their own bargains.

The problem here is that the banks have effectively misused their position to issue more credit than can ever be realised as goods and labour.

The problem here is twofold -

1) Fiat paper money being forced on people at gun point.

2) Commercial bankers pretending to have more fiat paper currency than they really do.

It's fraud built on top of coercion. utterly evil on every level.

Now, either we allow them to fail or we monetize the losses and thus completely destroy any credibility that the medium of exchange (fiat money) has. Without credibility of money, the whole system will fail.

And it shoudl fail. We don't need it.

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Yes yes yes, but SO WHAT? Stop dancing around the issue and answer some direct questions.

You have stated that banks will collapse because ‘they pretend to have money that they don’t have’, but so what? What does that mean? If you don’t know what money is in the first place, then how can you even begin to speculate the effects of banks lying etc?

I’m no fan of banks etc, but what you are saying lacks any in-depth analysis at all, and just repeatedly bangs on with the ‘money as legal tender’ gibberish. But what is legal tender? What is credit? What is money used for? What does it represent? I suggest you have a little think about this before posting again on the topic.

And for the bit in bold; you make no allowances for future promise – your idea of self-evidence only works if the exchange happens in real time. What if I give you 3 goats now in exchange for 100 kgs of your future winter vegetables? How does trust not come in to that equation?

Joe Public thinks that money = legal tender.

The banks are trapped because if Joe Public were to lose that misapprehension, then their ability to counterfeit legal tender would vanish.

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Massive generalisation there mate, and again you are not asking the fundamental question – what is the purpose of money?

to facilitate the trade of one asset for another. (work is an asset)

with a banking collapse, it isn't just a crisis of faith in the currency.

the REASON so many people were taking out all of their money in the depression, besides fear, is that everyone's loans were all being called in.

it wasn't voluntary, they couldn't just have left their money in the bank, all of the markers by everyone were being called in forcing people to get at their money immediately.

once you have a significant amount of monetary destruction and a contracting money supply through bankruptcy etc, there isn't enough money in the system to repay all debts at once.

"Faith" has nothing to do with it. (necessarily)

Edited by Mr Nice

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Wages can go down as every thing else goes up unless you are working for councils

Immigration by the poles have helped to kill the building trades and i don't buy into the propaganda that they are all going home.

Deflation ! i don't think so but wage deflation yes and this is what scum brown wanted all along.

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  • 399 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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