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Gaga
Germany433 Posts
but our dept based money system is the Drug in this game... politicians in a democracy will spend on credit to get elected. Ofc the junkie is at fault for taking the drug .... but instead of being forced to play with drugs we should think about different concepts of money. if you don't understand what i mean ( i guess it's not understandable) nevermind ... but im to lazy to write more now. | ||
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0x64
Finland4558 Posts
So many people don't understand economics here, it's hurting my brains. Let's start with the basics: 1. Free trade, free market -> most efficient way to produce. 2. The rates of credit should be adapted to local economy. Investment are then made according to needs and not because investing money is cheap. 3. Strong euro has no influence on exportation. This one alright, much trickier to understand, since it seems to be so strongly implanted in peoples mind. But let's put this backward. If it was so good for export and the economy then each government would just be printing money out. If the government prints out 10% more money, the price of the goods should go automatically 10% up to counter that. If they don't, money is lost by sellers and while the exports might rise, it is just equivalent with the situation of a strong money and the seller just lower his price. The difference is whether the government does it for you (like the USA) or not (EUR). Simply put: The world would be a much better place if corruption, market manipulation and jealousy against people earning money would disappear. People earns money for the good they produce, those earning more money are in general those who are able to be more efficient at producing goods. More good produced, better living condition for everyone (ever wondered how your whole country has internet, mobile phones, cars and so on...?). So no, capitalism, banks, rating agencies are not creating a problem by paying huge bonuses to traders. Governments are creating troubles by using money for goods that are either not produced or that are overestimated. edit: Conclusion: The euro should go down. It is a political money, not created for economic reason and it is not working out because the whole euro area isn't at the same economic level and will never be. | ||
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Ganondorf
Italy600 Posts
On July 20 2011 02:13 Gaga wrote: the danger is the resulting default of other PIIGS countrys.. and when italy or spain defaults it's game over because france and german bonds would go down as well if they would save them. Spain or Italy cannot be saved, if they default, the "strong" states go in trouble because they cannot claim bonds they previously bought (the states themselves, the banks, other private or public investors). As a consequence, the euro would devalue (finally!) cutting those stronger states growth, and the interest rates of their bonds would go up. The euro losing value is the best thing that could happen currently, it would avoid the default of states like Spain or Italy. | ||
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JieXian
Malaysia4677 Posts
On July 13 2011 20:26 maty wrote: This is from the european parliament: Wow that's very interesting.. | ||
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Gaga
Germany433 Posts
On July 20 2011 03:54 Ganondorf wrote: Spain or Italy cannot be saved, if they default, the "strong" states go in trouble because they cannot claim bonds they previously bought (the states themselves, the banks, other private or public investors). As a consequence, the euro would devalue (finally!) cutting those stronger states growth, and the interest rates of their bonds would go up. The euro losing value is the best thing that could happen currently, it would avoid the default of states like Spain or Italy. dude, thats what im saying ... you quoted it ... "when italy or spain defaults it's game over" and the devaluation of the euro, thats already happening, if you compare the euro and the US dollar u might think it's not the case. But thats just because its like comparing two people jumping out of the plane. | ||
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Ganondorf
Italy600 Posts
On July 20 2011 05:55 Gaga wrote: dude, thats what im saying ... you quoted it ... "when italy or spain defaults it's game over" and the devaluation of the euro, thats already happening, if you compare the euro and the US dollar u might think it's not the case. But thats just because its like comparing two people jumping out of the plane. Sorry maybe not many people are old enough to remember this, devaluation is when a state devalues their currency, sure it can lose value on the market without that but that's regular market value change. Most states now in trouble would just devalue their currency (by law) in order to be more competitive and cut debt interest costs. I remember Italy devaluing the lira by 10, or sometimes 20% at times in the past, and exports would benefit greatly from that, as well as public debt costs. | ||
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Ghad
Norway2551 Posts
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GameTime
United States222 Posts
Euro over the last year: ![[image loading]](http://goldprice.org/charts/history/gold_1_year_o_eur.png) US Dollar over the last year: ![[image loading]](http://goldprice.org/charts/history/gold_1_year_o_usd.png) Edit: I see this playing out as both the Euro and US Dollar going through hyperinflation, but that's a whole different discussion. Inflation has skyrocketed the last few years, where it only used to be about 1% a year, it's now closer to about 9-10% a year which is ridiculous. You can go here for gold to currency prices with charts: http://goldprice.org/gold-price-history.html | ||
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Maenander
Germany4926 Posts
On July 20 2011 17:31 GameTime wrote: Both the Euro and the US Dollar are going through heavy inflation right now. It's what happens when governments use fiat currencies and try to borrow or print money to cover their debts. Below are a couple of charts that compare the Euro and US Dollar to gold prices. Gold is known to be a stable way to retain purchasing power and is useful when measuring inflation. Euro over the last year: US Dollar over the last year: Edit: I see this playing out as both the Euro and US Dollar going through hyperinflation, but that's a whole different discussion. Inflation has skyrocketed the last few years, where it only used to be about 1% a year, it's now closer to about 9-10% a year which is ridiculous. You can go here for gold to currency prices with charts: http://goldprice.org/gold-price-history.html People don't realize that gold is not that different from fiat money, its worth is mostly determined by psychology and NOT by actual usage. Other materials like copper or oil are much more closely tied to industrial production, while the gold price is mostly determined by speculation. Gold is a good investment because people think it is safe, and because the amount is somewhat limited. The total gold stock is very likely to increase more slowly than the world economy, but if the world economy actually contracted for real, gold could lose its value rapidly. | ||
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lOvOlUNiMEDiA
United States643 Posts
On July 20 2011 22:09 Maenander wrote: People don't realize that gold is not that different from fiat money, its worth is mostly determined by psychology and NOT by actual usage. Other materials like copper or oil are much more closely tied to industrial production, while the gold price is mostly determined by speculation. Gold is a good investment because people think it is safe, and because the amount is somewhat limited. The total gold stock is very likely to increase more slowly than the world economy, but if the world economy actually contracted for real, gold could lose its value rapidly. I think I get your point. Gold's value isn't written in the stars. It, like all values, can fluctuate. So I think you're right that some people may not realize that gold's value is "psychological" -- meaning, there is no genie who bestows some automatic value upon it. But in this case, the reason the price of gold is going up is simply that investors feel more confident that gold will keep its value than they do that alternative investments (like the dollar) will. It has nothing to do with absolute value and everything to do with relative security. | ||
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Maenander
Germany4926 Posts
On July 20 2011 22:54 lOvOlUNiMEDiA wrote: I think I get your point. Gold's value isn't written in the stars. It, like all values, can fluctuate. So I think you're right that some people may not realize that gold's value is "psychological" -- meaning, there is no genie who bestows some automatic value upon it. But in this case, the reason the price of gold is going up is simply that investors feel more confident that gold will keep its value than they do that alternative investments (like the dollar) will. It has nothing to do with absolute value and everything to do with relative security. Yes, my point is also that the value of gold is not a particularly good indicator for inflation. P.S.: The value of gold is actually partly written in the stars, as the abundance of gold in earth's crust relative to other metals is actually dependent on the efficiency of gold production in a supernova.  | ||
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iansanew
New Zealand86 Posts
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MiraMax
Germany532 Posts
On July 20 2011 17:31 GameTime wrote: I see this playing out as both the Euro and US Dollar going through hyperinflation, but that's a whole different discussion. Inflation has skyrocketed the last few years, where it only used to be about 1% a year, it's now closer to about 9-10% a year which is ridiculous. You can go here for gold to currency prices with charts: http://goldprice.org/gold-price-history.html Inflation is at 9-10%!? What are you talking about? Do you mean the increase in gold prices? Do you know what inflation means? Current inflation is about 2.7% for the Euro Zone and 3.5% for the U.S.A. No hyperinflation in sight ... | ||
zatic
Zurich15329 Posts
On July 20 2011 23:32 iansanew wrote: well is the euro going down.. probably, but prices are so subjective they are all based on perceptions Renamed the thread because some donkeys still come into a 500 page thread apparently without reading past the topic title. | ||
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iansanew
New Zealand86 Posts
On July 20 2011 23:49 zatic wrote: Renamed the thread because some donkeys still come into a 500 page thread apparently without reading past the topic title. wow donkey? i did read past the topic title actually, but i chose to respond to the title because it was a question | ||
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Parj
France55 Posts
Everything is explained here http://democracyreform.blogspot.com/2010/05/root-cause-of-euro-crisis.html Conclusions:Make childrens. All this shit is a conspiracy from feminism movements to enslaves males at home  | ||
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Gaga
Germany433 Posts
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lOvOlUNiMEDiA
United States643 Posts
The financial problems in europe continue. Some global financial leaders are massaging the idea of a central financial authority with broader control that would allow quicker, more decisive action. This is supposed to restore market confidence. Interesting, and kind of alarming, stuff. | ||
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Bartuc
Netherlands629 Posts
On July 20 2011 02:58 0x64 wrote: 1. Free trade, free market -> most efficient way to produce. Imo that depends entirely on what you it is that you view as being more efficient. Many people tend to chase their momentary desires a lot, chasing and spending money with not enough wisdom and rational thinking involved concerning how it affects others' and their own future. Much of our society and economic behaviour is based around this and I wouldn't exactly call that a good thing in terms of long-term sustainability for our race and civilization. | ||
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Traeon
Austria366 Posts
1. Free trade, free market -> most efficient way to produce. In academia maybe. In reality you'll see oligopoles forming that are harmful to competitiveness and the customer and corporations doing unethical stuff because they're allowed to. Of course the corporations benefiting from deregulation will continue to tell you that the market should have as few rules as possible, but we saw where that led to in the last years. | ||
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