yes it is true that the US economy for the most part runs on consumerism, NAFTA and GATT, helped this along a great deal unfortunately, but the root of this problem lies in the authority that has the power to issue the nation's money which is the private federal reserve bank of NY, wages have not kept up with cost of living because of the continued and rapid expansion of the US dollar, the more of these digital green papers that enter circulation, the less valuable the ones that are already in circulation become which means higher prices over the long term because its cost more dollars to by the same amount of goods, it seems like many who talk about the economy want to dance around the main cause of the woes which is the private federal reserve, the minimum wage should be around 20 -25 dollars an hour, a working person in the 60s and early 70s had more purchasing power than working people do today, for example, a silver quarter being worth about 5 dollars today, a silver dollar and a silver quarter totaled equals 25 dollars today (remember workers used to get paid in real silver quarters, dimes and halves and the US is still currently operating under the legal fiction that a silver dollar has the exact same value as a federal reserve note, this is why up til this day you can walk into a bank with a 1921 Saint Gaudens 10 dollar gold piece and exchange it for a 10 dollar federal reserve note, now I would not recommend you do that because you can't get the 10 dollar gold piece back), after Nixon closed the gold window in 1971, the first batch of inflation hit, prices went up by 1000 percent over a 10 year period but wages only increased by 200 percent, now couple this with the exporting, offshoring and downsizing of the middle range and manufacturing jobs (shipped over seas), which did give us cheaper goods and help to slow down inflation, but it also allowed the fed to expand the money supplies even further which did lessen the purchasing value of the dollar, basically a working person today has to make 20-25 dollars an hour to equal the purchasing power that a person had back in 1967, remember the working man of 1967 was able to go to work and make enough money in a week to support himself, his wife and his kids, all on his salary, fast forward into the late 70s, early 80s, families realized that one salary was not enough, hence the wife had to go out and work and even the kids, when of age, started to go out and work to support the one family, you see by reducing the substance of money without reducing the physical form of money, the bankers have fooled a generation, people see that their wages have not kept up with the rate of inflation but they don't understand why, the people see that their parents might have earned 2 dollars an hour and were more comfortable and they might currently be earning 14 dollars and hour but they don't understand why it is so hard for them to keep up with the cost of living and many believe that is it their fault, when in point of fact, its not the working person's fault but the fault of the authority that issues and controls the currency in which that person is paid for his or her productivity, not to mention new and higher taxes that have been levied throughout the years as well
Quote Originally Posted by bobjustbob View Post
Roshi, you said a lot there. I'm having a hard time understanding it all. Please bear with me on this. I'm trying to understand a cause and effect. Chicken or egg. If I am following right you say that the removal of the gold standard made everyone charge more for goods and services. How did the people get the money into their pockets to pay for these things? Moms went to work. Where did these jobs come from? Was it to compete with those charging more? But the outsourcing and importing were providing us with cheaper goods.
You mentioned consumerism. I fault of the individual for this. We all want more and would like to afford all of these things. We are getting these things and making them essentials in our lives. Now I don't want to go back to the days of the ice box but does a refrigerator need to have 5 separate temperature controlled areas with ice and water dispensers? That's what we are buying. What do we really need from our cars? Get us from point A to point B. Heat and AC. Some listening device for news and good music when we are bored. Do we need a chip installed with personal settings for my seat and mirrors? We buy them too. Is it that much difference between a 720 and a 1080 television? I don't the fed can be blamed for our consumption that stuff.
I agree with you bob that a nation sustained on utter consumerism is not healthy even though the result has been cheaper goods but as I have stated previously when Nixon went to China back in the 70s, his ordered dealings with the Chines government helped to set the stage for much of the outsourcing that has gone on since then leading up to the present day free trade agreements which have hurt major manufacturing in the US workforce, and as far as price changes go, I am a not a top currency expert but yes when a nation delinks its currency from a real physical tangible asset like gold and silver, the only reason why that currency holds any value is because the people using that currency for buying and selling goods and services "believe" and have "confidence" in that currency as a medium of exchange, you see this is what gives the dollar its world reserve status, people still have a great amount of "confidence" in the US dollar, it is a franchise the private owners of the federal reserve bank control and will continue to expand the brand, now since these federal reserve notes (green paper as opposed to gold which has been a store of wealth for 5,000 years) at present are backed by nothing more than the good faith and credit of the US, the banks can monetize debt and print as much of them as they need to pay bills because these notes have been depegged from any tangible hard physical gold and silver measurement, hence economics 101 tells us that the more of this green funny money they print, the more of them will enter into circulation and eventually the results are inflationary because it takes more of these federal reserve notes to buy the same number of goods and services, so what this means for the average worker trying to make a living is a slow and steady decrease in his purchasing power because if that employee is not getting regular COLA increases to make up for that creeping inflation then he or she can never get ahead or break even, that worker will always be behind no matter how much more overtime they do and IMO its disgusting how the central banks know how their actions are hurting the people BUT they don't care because they have agendas that are going to be met one way or another, another point of note is that 4/5 of US dollars in circulation today are traded outside of the US which helps to stem inflation but if for some reason those dollars started to make their way back into the US (like what happened right after world war 1) then we would see instant inflation, also as I have stated there is a total of 12 trillion in MXM money (money that is hot, liquid and can be used at any time) that is just sitting in people's bank accounts across the US, if for some reason, the people started feeling really good and decided to go on massive shopping spree all at once then in this scenario you would also see instant inflation, I hope this explains my previous comment a little better
