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Just to reiterate the point about "naive libertarians/bitcoiners," let us not forget that someone invented a bitcoin ripoff and called it Ponzicoin that, not only gained rather frightening amounts of support, but generated a great deal of outrage when the founder just moonwalked away with the money.
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Dec 14, 2015 02:20
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ProfessorCurly posted:Just to reiterate the point about "naive libertarians/bitcoiners," let us not forget that someone invented a bitcoin ripoff and called it Ponzicoin that, not only gained rather frightening amounts of support, but generated a great deal of outrage when the founder just moonwalked away with the money. I respect that kind of honesty.
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Dec 14, 2015 02:22
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QuarkJets posted:That's not really accurate, as most US dollars are already digital. In many places you don't even need to carry physical currency anymore. Your "futuristic" credstick is just a Credit Card or Debit Card. Or, in most countries, you can instantly send someone digital cash (as in real currencies, not bitcoin) with your phone, for free. What I mean is, for every 'digital' dollar, there is a physical dollar. Making the US dollar digital just means instead of having armored cars transporting sheets of $100,000 bills between banks, the money just sits in it's secure vault and never has to leave. It's "ownership" is transferred without it having to be transferred. I think the banks avoid selling it as being digital, as that would probably cause a lot of people to panic and make a run on their banks. And yeah, I totally get that Credit/Debit Cards are our "credsticks", they're just not futuristic looking enough :P Where I am now, in Taiwan, it's the complete opposite. 100% of my transactions are in cash. I would love for things to be more digital, to let me transfer money back home much easier. As it is, it basically costs me 10% to transfer money via a wire. (Though, I'll admit, I've been a bit lazy about getting a bank account, and that might help with the costs a bit). Otherwise, reading more, it does seem like the only way to get "into" Bitcoin, is to become a scam artist and try to play everyone else. Captain_Maclaine posted:To add to this, the idea of untraceable crypto-currency (which bitcoin isn't, but that's not the point) has found any number of enthusiastic supporters among libertarians ex-pats living in Thailand who also have these just remarkable thoughts on why age of consent laws are unpardonable aggression against human liberty. As an expat living in Taiwan, I hate these guys because too many people think "Taiwan = Thailand".
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Dec 14, 2015 02:32
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ProfessorCurly posted:Just to reiterate the point about "naive libertarians/bitcoiners," let us not forget that someone invented a bitcoin ripoff and called it Ponzicoin that, not only gained rather frightening amounts of support, but generated a great deal of outrage when the founder just moonwalked away with the money. The r/bitcoin thread from when that happened is a thing of beauty. A few people saying, "What did you expect from something called Ponzicoin?" and a bunch of the suckers complaining that the scam the guy was running wasn't the same as the scam he said he was running.
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Dec 14, 2015 02:36
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ProfessorCurly posted:Just to reiterate the point about "naive libertarians/bitcoiners," let us not forget that someone invented a bitcoin ripoff and called it Ponzicoin that, not only gained rather frightening amounts of support, but generated a great deal of outrage when the founder just moonwalked away with the money. 'New, from the captains of industry that brought you the term "honest ponzi..."'
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Dec 14, 2015 02:44
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ToxicSlurpee posted:Normally I'm not one to laugh at misfortune but seriously ButtCoiners are a special kind of deliberate stupid. Every bit of misery they brought on themselves. I don't remember who said it, but one of the most perfect encapsulations of buttcoinerdom I ever read was, to paraphrase slightly, "it's like a version of the Prisoner's Dilemma where the only ones not mashing the "betray" as hard as they can are the guys inventing newer, more inventive ways to betray others." Muscle Tracer posted:'New, from the captains of industry that brought you the term "honest ponzi..."' Point of order, I believe the term was "legitimate ponzi" or "ponzi game." The idea was that of course everyone new the guy would run off sooner or later, but you were betting you could get fantastic gains and then bail while there were still enough marks coming in to keep the game going. See if you can guess what actually ended up happening!
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Dec 14, 2015 02:52
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YF19pilot posted:What I mean is, for every 'digital' dollar, there is a physical dollar. No there isn't. That's actually one of the big issues with the U.S. economy right now. You might ask "but how is that possible?" Fractional reserve banking is how. https://en.wikipedia.org/wiki/Fractional-reserve_banking Short of it is that a bank is allowed to loan $X for ever $1 they have deposited. This is also why, for the entire history of money, there has always been more money "on paper" than there has been in circulation. In any event if a bank has $10 and loan out $50 they've basically just miracled $40 into existence. This isn't actually as big of a deal as it sounds; a certain amount of fractional reserve banking doesn't really cause issues. It's only a problem if people run on the bank but there are things in place to prevent that from happening. That's why there are things like FDIC insurance on deposits. If the bank implodes than most people get all of their money anyway. This is once again an example of why regulation came into being. If you could pillage a bank in just the right way in the past then you could just shrug and walk off with everybody's money. Anyway you might be saying "but what's the stop the bank from just loaning money then loaning money based on those loans?" Regulation again. There is a hard limit on what $X is. It varies by nation. I think in America it's 9:1 but don't quote me on that; it's around there but I forget where. Even so an American bank if it's 9:1 can only loan $9 for every $1 they actually have. This puts a limit on the amount of loans a bank can write which of course puts a limit on the bank's income as loaning money is like, well, what banks are for. Banks make most of their money off of interest, generally based on loaning money backed by their deposits. Of course banks, being banks, loving love money and want as much of it as possible so they tend to...well...let's say not stop at 9:1. With the wretched enforcement of financial laws right now banks were loaning money at ratios orders of magnitude above the legal limit. The worst were up over 300:1. They gave no fucks whatsoever and this is ultimately why bubbles started popping. They were ultimately just stuffing poo poo loads of money into the system that only existed on paper and then handing the bill to everybody else when it inevitably popped. The banks kept their own money while the money that didn't really exist vanished from everybody else's pockets. How do you prevent this? You put regulations in place and create an agency with teeth watching for this poo poo. The short of it is: money doesn't work the way you think it does. One of the biggest issues right now is that banks have ways to manipulate the overall supply of money. If right now you're thinking "but then people are paying real money interest on imaginary money" it's because that's what happened.
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Dec 14, 2015 03:00
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ToxicSlurpee posted:. Eventually it turned out that you had to go on waiting lists that were years long to sell BitCoins. Nobody was buying except what turned out to be a bot that slapped fake transactions onto Mt. Gox, who eventually just vanished into the ether and made a lot of money just kind of vanish.  do you have a link to news and bitcoin threads talking about this.
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Dec 14, 2015 03:03
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Dr Pepper posted:
http://www.theguardian.com/technology/2014/may/29/bitcoin-bots-bought-millions-in-the-last-days-of-mt-gox If you Google it you get lots of stuff that were crytpo-coin related blogs (and often bad ones at that) but it crept into actual news as well. But yeah the short of it is actually what it sounds like; Mt. Gox was refusing to let people cash out and the actual demand for coins was incredibly low. Artificial demand was created to inflate the price then Mt. Gox blew up and collapsed. I mean, really. Anybody that wasn't a complete dumbass could see that buying ButtCoins was a terrible idea when the sellers far outnumbered buyers but the price kept going up anyway. ToxicSlurpee fucked around with this message at 03:08 on Dec 14, 2015 |
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Dec 14, 2015 03:05
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ToxicSlurpee posted:No there isn't. That's actually one of the big issues with the U.S. economy right now. That libertarians have suggested bitcoin as a way to prevent these sorts of problems occurring sort of perfectly describes their thought process: accurately describe a real or potential problem, then propose an answer which is either impractical, impossible, worse than the original problem, or all three somehow. Dr Pepper posted:
You might give our pals over at buttcoinfoundation a look. They've got a pretty extensive history of the hilarity, and have the notable record of being one of the only ones to actually make real money from bitcoins! (By having their original website bought out by notorious mining hardware scammers Butterfly Labs they called BFL's newest miners sacks of hot garbage).
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Dec 14, 2015 03:10
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ToxicSlurpee posted:No there isn't. That's actually one of the big issues with the U.S. economy right now. Okay, I was misinformed then. I had worked collections and did some underwriting at a small bank for a while and was told things were pretty much 1:1. I had never gotten the chance to actually read any of the regulations and stuff like that, though I usually get a call around Christmas time every year from the FDIC about a certain purchase one of my coworkers made. It's hilarious and I wish I could remember the name of the account, because I honestly think the person should have more government in their lives. Though it does explain a lot more about why the recent banking bubble and recession happened.
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Dec 14, 2015 03:28
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YF19pilot posted:Okay, I was misinformed then. I had worked collections and did some underwriting at a small bank for a while and was told things were pretty much 1:1. I had never gotten the chance to actually read any of the regulations and stuff like that, though I usually get a call around Christmas time every year from the FDIC about a certain purchase one of my coworkers made. It's hilarious and I wish I could remember the name of the account, because I honestly think the person should have more government in their lives. To put this into its horrifying perspective... This is what the banks were caught doing. What other fuckery did they get up to that they managed to hide?
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Dec 14, 2015 03:38
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ToxicSlurpee posted:To put this into its horrifying perspective... At the bank I worked at (very small bank), the previous president would more or less make various loans on the backs of napkins at his favorite bar. It was his favorite bar because he loaned most of the money and operating capital to run said bar. The bank I worked at was barred from making subprime loans altogether because of this. Otherwise, repossessing a car with a delinquent balance of about $400 was a heck of a poo poo show. The phone call I get every year is from my former coworker shopping for a motorcycle via our repossessions lot. He and the president (his father) were total cynical assholes who didn't want to make loans to anybody who wasn't already rich and white; despite our bank being a primarily agriculture bank, meaning our main purpose is to make loans to farmers (and how revolving ag-lines of credit work is something to behold).
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Dec 14, 2015 04:06
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ToxicSlurpee posted:No there isn't. That's actually one of the big issues with the U.S. economy right now. Just to expand a bit, banks can't lend out more physical money than they actually have. A bank can't "have $10 and loan out $50" because it doesn't have $50 to loan out. But it can have the same effect as that loaned-out money circulates through the economy and gets redeposited. What happens is, 10 people deposit $1, so there's $10 in the bank. As long as it keeps it on hand (full reserve banking) then bank runs are impossible, the bank has obligations of $10, it has $10, anyone can take all their money out at any time. Of course a bank doesn't make money this way so you have to charge a storage fee or something, safety deposit boxes work like this.In fractional reserve banking, the bank starts loaning out that money. If it loans out $1, it now holds $9. If all 10 people ask for their money at once, the bank can't pay them all and goes bankrupt. But odds are everyone isn't going to ask for their money at once so no problem. However, money has still been created: 10 people hold $1 liabilities from the bank, and an 11th person has $1. Let's say the bank lends out 90% of its deposits, so it has $100 and lends out $90 to someone who wants to start a business. The guy spends the $90 on buildings and equipment or whatever and the people he pays put that money back into the bank. Well now the bank can lend out 90% of this money so it lends out $81. If that gets put back into the bank it can lend out $72. Now if you add up all the people who have deposits, you get $100+$90+$81= $271 while the bank only has $10+$9+$8 = $27 on hand, and it has $90+81+$72=$243 in outstanding loans. In this way, the bank has not only loaned out almost ten times as much as it kept, but those original $100 have circulated around a couple times and are now responsible for $243 of financing in the economy, so money has been created. As long as it all unwinds properly (loan payments come in at least as fast as deposits come out) then the bank stays solvent. Of course, if loans start going bad and people start defaulting, then depositors can get nervous and start trying to pull out their money. At this point you've got people trying to pull their $271 claims from a bank with $27 in the vault. TLDR: It's not so much that banks can magically lend out more than they have, it's that since banks both lend out and accept deposits, the same original $100 is lent out and deposited and lent out again, creating a recursive cycle of more and more claims on that original pile of cash.
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Dec 14, 2015 04:33
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ToxicSlurpee posted:To put this into its horrifying perspective... Well fractional reserve banking is legal and not fraud. It's just how banks work. Technically yes banks have more in outstanding claims than cash on hand and if everyone asks for their money at once the bank will default, but that's what lending standards and regulations about reserves and so on are for. An insurance company wouldn't be able to pay out if by some freak accident trees fell on everyone's cars all at once, but that doesn't mean car insurance is fuckery, as long as the company is run according to good actuarial principles. What the banks were doing in the mortgage crisis was so much more hosed than that. Making sub-prime or totally undocumented loans, dividing them up into tranches so they could rate the top tranche AAA, then taking all the bottom tranches putting them together and redividing them again so they could rate part of that AAA. And for whatever they couldn't sell, they took default insurance out on from some sucker like AIG who had a manager that loved boosting quarterly numbers (and his bonuses) by raking in these insurance payments that turned out to be wayyyyyyy too small to cover the risks, oh and then because nothing was regulated, other people would bet on bad loans by taking out insurance on them, meaning that if one loan defaulted the insurer would have to pay our 3 or 4 or 5 or more times, which AIG couldn't do, leaving all those banks holding the junk uninsured after all. And then let's get into the fact that since you were allowed to take out insurance on loans you didn't own, banks like Goldman & Sachs would purposely create products full of the worst loans they could possibly find, then sell it to their customers and secretly take insurance on them, betting they'd fail.
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Dec 14, 2015 04:47
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And then Bank of America seizes a bunch of houses that they really really shouldn't have.
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Dec 14, 2015 04:52
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paragon1 posted:And then Bank of America seizes a bunch of houses that they really really shouldn't have. Uh excuse me, *rifles through piles of paperwork generated that morning, all filled out in identical handwriting* as you can see your house belongs to us. Or at least it belongs to somebody and that's enough for Americans to agree that we should get it, because we can't let a delinquent mortgage-holder get over now can we.
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Dec 14, 2015 05:06
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VitalSigns posted:Well fractional reserve banking is legal and not fraud. No, fractional reserve banking is not fraud so long as banks stay within the lines. American banks were not staying within the lines. This was the problem, really; the legal limits put in place that the banks knew about were being ignored because said limits were not being enforced and the banks knew that. A law that isn't enforced may as well not exist. It was just another facet of the gigantic poo poo storm that you posted about. Trust me, I know about all of that but that's also why I say "this is what we knew about and it is terrible." Goldman Sachs was the worst offender and they had fractional reserve banking going into downright absurd ratios. This isn't a matter of the super wealthy playing a game at a different level than the rest of us. They aren't even playing; they're writing the rules and the rules are "gently caress you the bank wins and gets everything."
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Dec 14, 2015 05:20
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Yeah the leveraging was insane, although I thought that was all on the unregulated financial products and credit default swaps side, not on the deposits which are still tightly regulated because they're FDIC insured. But there was a bunch of dumb accounting poo poo, like if you had your loans insured with a CDS then they didn't count for leverage because you'd be made whole and there were gaps in the laws that didn't make you take into account counterparty risk. But it's been a long time since I've read about it because it makes me too mad, plus nobody ever wants to hear about it and the whole thing sounds so insane that you come off as a conspiracy theorist when you talk about things that actually happened.
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Dec 14, 2015 05:30
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VitalSigns posted:Yeah the leveraging was insane, although I thought that was all on the unregulated financial products and credit default swaps side, not on the deposits which are still tightly regulated because they're FDIC insured. The SEC has a revolving door between itself and Wall Street. It also has no teeth and is woefully underfunded. Take a wild guess how much of this stuff was actually investigated which is kind of the first step to, you know, actually prosecuting anything. The laws mean gently caress all if the agency supposed to enforce them can't or won't.
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Dec 14, 2015 05:32
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And this is the part of the conversation where we all remember that George fuckin' W Bush had a better record of actually prosecuting white-collar criminals than the Obama administration. Lay and Skilling and all them actually went to jail. What have we got two convictions from the financial crisis: a dude who literally stole billions of dollars in an outright Ponzi scheme, and some French middle manager at G&S because he was dumb enough to send e-mails to his girlfriend that said "yeah we are totally screwing our own customers in this deal can you believe it"
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Dec 14, 2015 05:41
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ProfessorCurly posted:Just to reiterate the point about "naive libertarians/bitcoiners," let us not forget that someone invented a bitcoin ripoff and called it Ponzicoin that, not only gained rather frightening amounts of support, but generated a great deal of outrage when the founder just moonwalked away with the money. I read one interesting article once that suggested the reason the Nigerian Prince e-mails are such obvious scams is because in the digital world reaching a bunch of people is cheap, but actually trying to reel someone in is a huge time sink which is wasted if they get suspicious so you work more efficiently if everyone but the absolute dumbest gulliblest people figure it out right away and self-select out, so you have a higher success rate with the idiots who actually do respond to the blatant con.
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Dec 14, 2015 05:46
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VitalSigns posted:Well fractional reserve banking is legal and not fraud. It's just how banks work. Technically yes banks have more in outstanding claims than cash on hand and if everyone asks for their money at once the bank will default, but that's what lending standards and regulations about reserves and so on are for. An insurance company wouldn't be able to pay out if by some freak accident trees fell on everyone's cars all at once, but that doesn't mean car insurance is fuckery, as long as the company is run according to good actuarial principles. Yeah, this is a good explanation. Also, the comment "an insurance company wouldn't be able to pay out if by some freak accident trees fell on everyone's cars all at once" explains very well what went wrong with CDOs (the financial instruments created from the subprime mortgages). The reason AAA-rated CDOs were supposed to be so safe is that, out of a pool of subprime mortgages, the highest-rank CDOs represented a claim to get paid first when the bank received any subprime mortgage payments. So returns on them were guaranteed unless a large proportion (>15%) of subprime mortgage payers defaulted. This was considered incredibly unlikely, since historically only 4-6% of subprime mortgage payers defaulted, and it's hard to imagine an event that would cause mortgage payers all over the country to default all at once. It was CDOs' popularity that caused big problems. Like you said, banks started writing riskier and riskier loans to repackage and sell as CDOs, since the person buying the CDO took on all the risks of the mortgage. Suddenly homebuyers had massive access to credit, so demand for real estate increased, so homes got pricier, so more people took out risky mortgages so they wouldn't miss the boat on increasing real estate prices, so prices rose more. CDOs directly caused a speculative bubble. When that bubble finally burst, between the massive drop in real estate prices and the underlying shittiness of loans made quick to sell CDOs, homebuyers defaulted nationwide in numbers beyond what anybody predicted. Basically, CDOs were perfectly safe unless a completely unprecedented catastrophe happened, but CDOs incentivized banks to behave in a new way that caused a completely unprecendented catastrophe. Oops. Trees fell on everyone's cars.
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Dec 14, 2015 05:46
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...And that's why we think free, completely unregulated markets in everything for everyone forever is really the way to go.
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Dec 14, 2015 06:22
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Saeku posted:Basically, CDOs were perfectly safe unless a completely unprecedented catastrophe happened, but CDOs incentivized banks to behave in a new way that caused a completely unprecendented catastrophe. Oops. Trees fell on everyone's cars. Pretty much. It was the perfect example of the Prisoner's Dilemma. "Well if I make a bad loan, it doesn't matter if it fails because it's packaged with loans from all over the country so there will still be good payouts since no nationwide downturn has ever happened", unless of course everyone thinks that way and makes bad loans in every part of the country at once. And the endurance of Libertarianism is a testament to human nature: no matter how many times we prove that the solution to the Prisoner's Dilemma is to use law and regulation to enforce cooperation, there will always be those who want to believe that they could be profiting so much more if the government would get out of the way and let them pound that Betray button.
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Dec 14, 2015 06:24
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VitalSigns posted:Pretty much. It was the perfect example of the Prisoner's Dilemma. "Well if I make a bad loan, it doesn't matter if it fails because it's packaged with loans from all over the country so there will still be good payouts since no nationwide downturn has ever happened", unless of course everyone thinks that way and makes bad loans in every part of the country at once. On the surface libertarianism sounds good. I ended up going libertarian when I started voting because I had read about various political theories (I was...strangely informed as a teenager but was also literally crazy and also, you know, a stupid teenager) and agreed with the central points of libertarianism and anarchism. What I eventually came to realize was that the greatest irony of free markets is that it actually takes a ton of regulation to keep them free. Libertarian policies, as they advertise them today, will absolutely not sync up with libertarian goals. This is why I ended up becoming a socialist in the end. The core of my beliefs haven't changed but I became less young, less stupid, and less crazy and realized some pretty important things along the way. Perhaps the most important is that you can only have true meritocracy if you have a level playing field. The playing field is only level if you create it in the first place and then force it to stay that way. Current libertarian policy is directly opposed to that.
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Dec 14, 2015 06:52
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ToxicSlurpee posted:On the surface libertarianism sounds good. I ended up going libertarian when I started voting because I had read about various political theories (I was...strangely informed as a teenager but was also literally crazy and also, you know, a stupid teenager) and agreed with the central points of libertarianism and anarchism. What I eventually came to realize was that the greatest irony of free markets is that it actually takes a ton of regulation to keep them free. Libertarian policies, as they advertise them today, will absolutely not sync up with libertarian goals. Goddamn that was the most liberal thing I've ever seen, like no offense but once we hit full communism I'd rather not see where meritocracy goes... Maybe that's just me i dunno.
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Dec 14, 2015 08:37
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Twerkteam Pizza posted:Goddamn that was the most liberal thing I've ever seen, like no offense but once we hit full communism I'd rather not see where meritocracy goes... The whole point of meritocracy is that people who are capable of great things should have the opportunity to do great things. Similarly people that want to pursue greater reward than others should be able to do so without being held back. My own experiences with being poor as hell made me realize that silly socialist concepts like "a strong safety net" or "removal of dynastic wealth" would go a long way toward helping that along. Plus things like free college, socialized medicine, and what have you will also allow our best and brightest to do their thing. I'm not arguing in favor of brutal social Darwinism like libertarians often advocate simple because what the total deregulation, no taxes ever, and no free lunch things ends up doing is creating a caste system. Libertarian policy prevents people with potential from achieving it based on accidents of birth. Without things like strong social safety nets and free education those born poor, in the wrong neighborhood, or into the wrong race are handicapped, sometimes impossibly so. I realized through my own experiences being a poor guy that there are certain things that absolutely must be provided to everybody equally or actual meritocracy is impossible. The end result of that will be everybody getting food, housing, educational access, and medical care provided for them if they can't afford it otherwise but really, I'm OK with that. The end result of cutting taxes and social services to the bone will not achieve the end results that libertarianism claims to want. The thing with meritocracy is that you don't know where, say, your next top scientist will come from. Some of the most important advances in various fields came from places you'd never expect. If said top scientist is too busy struggling to keep the rent paid and the lights on to study physics then society has lost out. That's wasted potential but the end result of libertarian policy is things like that. If that person is born into crushing poverty it's unlikely they'll get a proper education. Which is I think where the communist quote of "from each according to ability, to each according to need" comes from. Not everybody can be Nikola Tesla, after all. ToxicSlurpee fucked around with this message at 08:56 on Dec 14, 2015 |
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Dec 14, 2015 08:52
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You don't need public education, it's a waste of time for black teens anyway who can easily learn the bit of arithmetic it takes to pick and weigh cotton while on the job  
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Dec 14, 2015 08:55
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ToxicSlurpee posted:The whole point of meritocracy is that people who are capable of great things should have the opportunity to do great things. Similarly people that want to pursue greater reward than others should be able to do so without being held back. My own experiences with being poor as hell made me realize that silly socialist concepts like "a strong safety net" or "removal of dynastic wealth" would go a long way toward helping that along. Plus things like free college, socialized medicine, and what have you will also allow our best and brightest to do their thing. I'm not arguing in favor of brutal social Darwinism like libertarians often advocate simple because what the total deregulation, no taxes ever, and no free lunch things ends up doing is creating a caste system. I mean, I was just concerned by your conceptions of meritocracy. The only concern I have with the term is that in practice it has devalued current materials (like, keeping a bridge up to code) with shiny new poo poo to replace it. Maybe I'm being conservative garbage, but I do agree with the main goals of communism and Lenin is my dude. I think I reacted so harshly because 'meritocracy' is conflated with 'did you make a thing?' and being a sociologist my field doesn't produce things, so university department gets devalued. Like you said, when everyone's basic needs and rights are met, then the creme can rise to the top (or however that saying goes). Sorry for being reactionary I guess 
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Dec 14, 2015 09:53
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VitalSigns posted:Let's say the bank lends out 90% of its deposits, so it has $100 and lends out $90 to someone who wants to start a business. The guy spends the $90 on buildings and equipment or whatever and the people he pays put that money back into the bank. Well now the bank can lend out 90% of this money so it lends out $81. If that gets put back into the bank it can lend out $72. Now if you add up all the people who have deposits, you get $100+$90+$81= $271 while the bank only has $10+$9+$8 = $27 on hand, and it has $90+81+$72=$243 in outstanding loans. In this way, the bank has not only loaned out almost ten times as much as it kept, but those original $100 have circulated around a couple times and are now responsible for $243 of financing in the economy, so money has been created. As long as it all unwinds properly (loan payments come in at least as fast as deposits come out) then the bank stays solvent. ToxicSlurpee posted:Short of it is that a bank is allowed to loan $X for ever $1 they have deposited. This is also why, for the entire history of money, there has always been more money "on paper" than there has been in circulation. In any event if a bank has $10 and loan out $50 they've basically just miracled $40 into existence. This isn't actually as big of a deal as it sounds; a certain amount of fractional reserve banking doesn't really cause issues. It's only a problem if people run on the bank but there are things in place to prevent that from happening. That's why there are things like FDIC insurance on deposits. If the bank implodes than most people get all of their money anyway. This is once again an example of why regulation came into being. If you could pillage a bank in just the right way in the past then you could just shrug and walk off with everybody's money. Fractional reserve banking doesn't quite work like this in reality. The Federal Reserve themselves have found that changes in reserves are unrelated to changes in lending. The process actually works in reverse: "In the real world, banks extend credit, creating deposits in the process, and look for the reserves later." https://www.youtube.com/watch?v=SkAzDrrKkME These go into a bit more detail: http://www.bankofengland.co.uk/publications/Documents/quarterlybulletin/2014/qb14q1prereleasemoneycreation.pdf https://www.kreditopferhilfe.net/docs/S_and_P__Repeat_After_Me_8_14_13.pdf
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Dec 14, 2015 12:40
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ToxicSlurpee posted:The whole point of meritocracy is that people who are capable of great things should have the opportunity to do great things. Similarly people that want to pursue greater reward than others should be able to do so without being held back. My own experiences with being poor as hell made me realize that silly socialist concepts like "a strong safety net" or "removal of dynastic wealth" would go a long way toward helping that along. Plus things like free college, socialized medicine, and what have you will also allow our best and brightest to do their thing. I'm not arguing in favor of brutal social Darwinism like libertarians often advocate simple because what the total deregulation, no taxes ever, and no free lunch things ends up doing is creating a caste system. You still have far to go on the inevitable journey to communism. These social safety nets are mere compromises, they are not the true solution to the problem which is capitalism. The solution is not capitalism with more meritocracy. The solution is that we all get together and decide on all the things we want produced and services we want provided and go about getting everything done, improving things as we go. So basically we would calculate how many hours we'll need to work every week and then go about making changes, introducing automation, etc. to lower that number as much as possible, only increasing it for emergencies or for new wonderful things we want to make. This will probably sound insane to you now but you'll get there eventually.
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Dec 14, 2015 14:25
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The key procession for me was thinking about how the amount of time we have to spend on labor has changed over time. Centuries ago we needed the vast majority of people working on farms to keep everyone fed. But automation and economies of scale have reduced the amount of labor required for producing the goods society needs*, food or otherwise. At this point, we simply don't need everyone working full time to produce what everyone needs. So how do you deal with that? A few options present themselves:
Once you accept the fact that we have more time than we know what to do with, it's just a matter of deciding which of those options is the most appealing to you. (Unless of course you're devoted to some weird nonconsequentialist moral philosophy that doesn't care about human suffering, in which case "dealing with problems" isn't really your thing anyway.) *Is "socially necessary labor time" a phrase that will set off the Pinko Alarm? Like, I can learn a lot about someone's political leanings just from hearing them use phrases like "mixing your labor with the land" or "fiat currency," but I'm not sure what the equivalent leftist giveaways are. "Means of production" is definitely one, but I don't know beyond that.
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Dec 14, 2015 17:59
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Nolanar posted:*Is "socially necessary labor time" a phrase that will set off the Pinko Alarm? Like, I can learn a lot about someone's political leanings just from hearing them use phrases like "mixing your labor with the land" or "fiat currency," but I'm not sure what the equivalent leftist giveaways are. "Means of production" is definitely one, but I don't know beyond that. Yup. Anyone using that phrase will usually be arguing that the value created by work is embodied by the socially necessary labour time and that the surplus value extracted by companies is exploitative.
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Dec 14, 2015 18:05
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Nolanar posted:*Is "socially necessary labor time" a phrase that will set off the Pinko Alarm? Yeah but I don't think it means in Marxian analysis what it looks like you want to use it to mean, i.e., it's not the amount of time needed to produce everything society needs, it's the smallest amount of time that it takes to make a thing based on the general level of automation and skill (so a shoe doesn't have any more value just because you take 8 hours to make it when everyone else can make it in 1). I think.
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Dec 14, 2015 18:07
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GunnerJ posted:Yeah but I don't think it means in Marxian analysis what it looks like you want to use it to mean, i.e., it's not the amount of time needed to produce everything society needs, it's the smallest amount of time that it takes to make a thing based on the general level of automation and skill (so a shoe doesn't have any more value just because you take 8 hours to make it when everyone else can make it in 1). I think. Oh whoops. I over-edited my post and didn't notice the shift in definitions. I had it right originality, I swear.
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Dec 14, 2015 18:21
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My favorite pinko phrase has gotta be "From each according to his abilities, to each according to his needs," but I also like "class war" and "revolution"* *when not used to talk about the American Revolution
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Dec 14, 2015 21:02
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Only communists talk about revolutions in countries that aren't America?
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Dec 14, 2015 21:05
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Twerkteam Pizza posted:I mean, I was just concerned by your conceptions of meritocracy. The only concern I have with the term is that in practice it has devalued current materials (like, keeping a bridge up to code) with shiny new poo poo to replace it. Maybe I'm being conservative garbage, but I do agree with the main goals of communism and Lenin is my dude. I think I reacted so harshly because 'meritocracy' is conflated with 'did you make a thing?' and being a sociologist my field doesn't produce things, so university department gets devalued. Like you said, when everyone's basic needs and rights are met, then the creme can rise to the top (or however that saying goes). Well being a sociologist means you're like...out studying things or fixing social problems or something, right? You don't need to be producing an actual, physical good to be doing something that has value, which is where a lot of libertarians go wrong. This is incidentally why libertarian views on science are pretty loving stupid. The idea is that any form of study is useful only if it quickly and directly leads to something that you can profit on. Which is not at all how science and learning work. In the case of sociology the answers to questions like "how do humans act in very large groups?" are well, you know, pretty drat useful. Knowledge is a thing. If what you're doing is furthering the human race's understanding of the universe then hey, high five, keep doing that. The point of meritocracy is that you let your best and brightest be the best and brightest no matter where they came from. One of the big issues with libertarian thought is really that it would make America's inequality problems significantly worse.
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Dec 14, 2015 22:53
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Dr. Stab posted:Only communists talk about revolutions in countries that aren't America? Sure yeah ToxicSlurpee posted:Well being a sociologist means you're like...out studying things or fixing social problems or something, right? You don't need to be producing an actual, physical good to be doing something that has value, which is where a lot of libertarians go wrong. This is incidentally why libertarian views on science are pretty loving stupid. The idea is that any form of study is useful only if it quickly and directly leads to something that you can profit on. I like you, you're cool in my book
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Dec 14, 2015 23:44
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