Iraq War "Caused Slowdown in the US"

[Lt_Ripley]

Iraq War "Caused Slowdown in the US"

By Peter Wilson

The Australian

Thursday 28 February 2008

The Iraq war has cost the US 50-60 times more than the Bush administration predicted and was a central cause of the sub-prime banking crisis threatening the world economy, according to Nobel Prize-winning economist Joseph Stiglitz.

The former World Bank vice-president yesterday said the war had, so far, cost the US something like $US 3 trillion ($3.3 trillion) compared with the $US 50-$US 60 billion predicted in 2003.

Australia also faced a real bill much greater than the $2.2billion in military spending reported last week by Australian Defence Force chief Angus Houston, Professor Stiglitz said, pointing to higher oil prices and other indirect costs of the wars.

Professor Stiglitz told the Chatham House think tank in London that the Bush White House was currently estimating the cost of the war at about $US 500 billion, but that figure massively understated things such as the medical and welfare costs of US military servicemen.

The war was now the second-most expensive in US history after World War II and the second-longest after Vietnam, he said.

The spending on Iraq was a hidden cause of the current credit crunch because the US central bank responded to the massive financial drain of the war by flooding the American economy with cheap credit.

"The regulators were looking the other way and money was being lent to anybody this side of a life-support system," he said.

That led to a housing bubble and a consumption boom, and the fallout was plunging the US economy into recession and saddling the next US president with the biggest budget deficit in history, he said.

Professor Stiglitz, an academic at the Columbia Business School and a former economic adviser to president Bill Clinton, said a further $US 500 billion was going to be spent on the fighting in the next two years and that could have been used more effectively to improve the security and quality of life of Americans and the rest of the world.

The money being spent on the war each week would be enough to wipe out illiteracy around the world, he said.

Just a few days' funding would be enough to provide health insurance for US children who were not covered, he said.

The public had been encouraged by the White House to ignore the costs of the war because of the belief that the war would somehow pay for itself or be paid for by Iraqi oil or US allies.

"When the Bush administration went to war in Iraq it obviously didn't focus very much on the cost. Larry Lindsey, the chief economic adviser, said the cost was going to be between $US 100 billion and $US 200 billion - and for that slight moment of quasi-honesty he was fired.

"(Then defence secretary Donald) Rumsfeld responded and said 'baloney', and the number the administration came up with was $US 50 to $US 60 billion. We have calculated that the cost was more like $US 3 trillion.

"Three trillion is a very conservative number, the true costs are likely to be much larger than that."

Five years after the war, the US was still spending about $US 50 billion every three months on direct military costs, he said.

Professor Stiglitz and another Clinton administration economist, Linda Bilmes, have produced a book, The Three Trillion Dollar War, pulling together their research on the true cost of the war, which does not include the cost to Iraq.

One of the greatest discrepancies is that the official figures do not include the long-term healthcare and social benefits for injured servicemen, who are surviving previously fatal attacks because of improved body armour.

"The ratio of injuries to fatalities in a normal war is 2:1. In this war they admitted to 7:1 but a true number is (something) like 15:1."

Some 100,000 servicemen have been diagnosed with serious psychological problems and the soldiers doing the most tours of duty have not yet returned.

Professor Stiglitz attributed to the Iraq war $US 5-$US 10 of the almost $US 80-a-barrel increase in oil prices since the start of the war, adding that it would have been reasonable to attribute more than $US 35 of that rise to the war.

He said the British bill for its role in the war was about 20 times the pound stg. 1billion ($2.1 billion) that former prime minister Tony Blair estimated before the war.

The British Government was yesterday ordered to release details of its planning for the war, when the country's Information Commissioner backed a Freedom of Information request for the minutes of two cabinet meetings in the days before the war.

Commissioner Richard Thomas said that because of the importance of the decision to go to war, the public interest in disclosing the minutes outweighed the public interest in withholding the information.

http://www.truthout.org/docs_2006/022908T.shtml

[Caesar]

This is nonsense, first off the war hasn't cost the U.S. tax payer 3 trillion dollars in Iraq or Afganistan, the slow down is due to a few things, the credit markets, oil prices, inflation and the emerging markets rasining the prices of most commodities to name a few. you gotta love these Nobel Prize winners though!

[Atheist God]

This is nonsense, first off the war hasn't cost the U.S. tax payer 3 trillion dollars in Iraq or Afganistan, the slow down is due to a few things, the credit markets, oil prices, inflation and the emerging markets rasining the prices of most commodities to name a few. you gotta love these Nobel Prize winners though!

Actually the war on terror has now cost around 3 trillion... I attribute the economic slowdown in large part due to the exporting of jobs overseas due to NAFTA which has been less then beneficial for the US. The war costs so much because of military privatization... It's no wonder a war costs so much when contractors are being paid $200 an hour to do the same jobs the military could be doing.

[Caesar]

Actually the war on terror has now cost around 3 trillion... I attribute the economic slowdown in large part due to the exporting of jobs overseas due to NAFTA which has been less then beneficial for the US.

No, the war hasn't cost 3 trillion or even close. I'm using the actual numbers. Nafta has nothing to do with this slowdown, the cheap U.S. dollar actually helps with trade and in part has raised the price of most U.S. commodity prices.

[acidhead]

The following letter to the editor from Dr. Paul ran in today's Wall Street Journal:

"I was delighted to read in Judy Shelton's op-ed, "Security and the Falling Dollar" (Feb. 15), that at long last the security implications of the dollar's collapse have made their way into the mainstream media. The dollar's strength (or lack thereof) has been of paramount concern to me, and the subject of many of my statements over the past several years. Decades of manipulation by the Federal Reserve have benefited the government and certain politically-connected firms, while gradually destroying the purchasing power of middle-class Americans. Despite numerous warnings in the past, it is only now at a point of acute crisis that Washington insiders are beginning to awaken to the reality of the end of dollar hegemony.

"While I desire reform of our current monetary system, my own proposals have not been as all-encompassing as Ms. Shelton's suggestion to return to a Bretton Woods-style system. Her recommendation, though, that gold backing should make up a component of a future monetary system, is one that we would all do well to heed. My own legislative proposals focus around eliminating the taxes and laws that dissuade individuals and institutions from using gold as currency or as a backing for currency. By allowing market processes to determine the issuance of currency, we can allow individuals to decide for themselves what currency they wish to use. This would lead to a gradual reintroduction of sound money and avoid the market shocks that occur when monetary decisions are mandated by government fiat."

Rep. Ron Paul (R., Texas)

Washington

[Atheist God]

No, the war hasn't cost 3 trillion or even close. I'm using the actual numbers. Nafta has nothing to do with this slowdown, the cheap U.S. dollar actually helps with trade and in part has raised the price of most U.S. commodity prices.

The US has become the country everyone loves to hate unfortunately and a weakening dollar does not necessarily mean better business all around. The nations that hold the 9 trillion dollar debt may start losing faith in the US economy and dump the bonds onto the market causing a crash.

Nothing lasts forever and the US has become a helpless giant thats nearly run it's course like other empires before it.

As for numbers please provide a source because from what I have read there is no single number and many costs have been excluded from the official total.

Joseph Stiglitz is who I will choose to believe just because this government has lied so many times it's difficult to determine if they have or have not skewed the numbers. He has been working since 05 to tabulate the costs of the war and factor in costs that aren't in the official numbers.

The national debt has went up by more than 3 trillion in the last 8 years and the war is their largest expenditure.

Guardian

[Caesar]

The following letter to the editor from Dr. Paul ran in today's Wall Street Journal:

"I was delighted to read in Judy Shelton's op-ed, "Security and the Falling Dollar" (Feb. 15), that at long last the security implications of the dollar's collapse have made their way into the mainstream media. The dollar's strength (or lack thereof) has been of paramount concern to me, and the subject of many of my statements over the past several years. Decades of manipulation by the Federal Reserve have benefited the government and certain politically-connected firms, while gradually destroying the purchasing power of middle-class Americans. Despite numerous warnings in the past, it is only now at a point of acute crisis that Washington insiders are beginning to awaken to the reality of the end of dollar hegemony.

"While I desire reform of our current monetary system, my own proposals have not been as all-encompassing as Ms. Shelton's suggestion to return to a Bretton Woods-style system. Her recommendation, though, that gold backing should make up a component of a future monetary system, is one that we would all do well to heed. My own legislative proposals focus around eliminating the taxes and laws that dissuade individuals and institutions from using gold as currency or as a backing for currency. By allowing market processes to determine the issuance of currency, we can allow individuals to decide for themselves what currency they wish to use. This would lead to a gradual reintroduction of sound money and avoid the market shocks that occur when monetary decisions are mandated by government fiat."

Rep. Ron Paul (R., Texas)

Washington

Ron Paul is a fool!! if a weak dollar is sooooooo bad, then why do countries like Japan and China purposly devalue thiers, extremely low? Russia, Mexico, Brazil, and India also enjoy the benefits of weak currency. a weak U.S, dollar slows thier GDP growth, decrease business profits, and cause nations to buy their products and services. Russia's devalued currency is hurting the EU steel mills, Canada for awile devalued its currency for awile and sent many U.S. companies to Canada.

Only people who lack global economics want a dollar backed by gold

I know the government is ruled by neocoms, Zionist and the free masons

[Caesar]

The US has become the country everyone loves to hate unfortunately and a weakening dollar does not necessarily mean better business all around. The nations that hold the 9 trillion dollar debt may start losing faith in the US economy and dump the bonds onto the market causing a crash.

Nothing lasts forever and the US has become a helpless giant thats nearly run it's course like other empires before it.

As for numbers please provide a source because from what I have read there is no single number and many costs have been excluded from the official total.

Well again, I'm using the facts, while I agree the U.S. is on the top ten list of hate lists, the numbers show U.S. exports have been getting better, and our cheap dollar has made comodity prices shoot threw the roof

War costs could total $1.6 trillion by 2009, panel estimates for both wars

Joseph Stiglitz is who I will choose to believe just because this government has lied so many times it's difficult to determine if they have or have not skewed the numbers. He has been working since 05 to tabulate the costs of the war and factor in costs that aren't in the official numbers.

The national debt has went up by more than 3 trillion in the last 8 years and the war is their largest expenditure.

Guardian

Sure you can believe any economist you want, and believe any number you want to believe, but I think its silly to have a discussion when you are using data thats based on myths, lies and half truths, by people people who are selling snake oil. he was part of the Clinton Administrationand is also invovled in the left wing Intergovernmental Panel on Climate Change. while the wars have added to our national debt, its nonsense to say that the debt under Bush was due to the war in Iraq, I think the 9/11 attacks has added more to the debt under Bush then the war in Iraq.

I don't understand how you could say "Nothing lasts forever and the US has become a helpless giant thats nearly run it's course like other empires before it." when the debt as a % of GDP has been much worst in the past.

[acidhead]

Ron Paul is a fool!! if a weak dollar is sooooooo bad, then why do countries like Japan and China purposly devalue thiers, extremely low? Russia, Mexico, Brazil, and India also enjoy the benefits of weak currency. a weak U.S, dollar slows thier GDP growth, decrease business profits, and cause nations to buy their products and services. Russia's devalued currency is hurting the EU steel mills, Canada for awile devalued its currency for awile and sent many U.S. companies to Canada.

Only people who lack global economics want a dollar backed by gold

I know the government is ruled by neocoms, Zionist and the free masons

Caesar,

Its very apparent that you're extremely confused on this topic.

yet,

Can you answer the following simple questions and prove me wrong? (stick to the question when answering)

You can even use google to find the answers!

1. Why does America, China, Canada and Japan purposely devalue their currency as you claim they do?

2. How is a currency devalued?

3. What causes inflation?

This may be difficult for you but try your best to stay on topic.

Based on your comments so far this little quiz will be laughable. LOL!!!

Good luck!

One more thing- STAY ON TOPIC..

Edited March 1, 2008 by acidhead43

[questionmark]

Saying that the Iraq war caused the slowdown is only half the truth, living above the means is what caused the slowdown... or those 30 years the US has spent more than it actually made.

And before you all start boring me with Keynes and consorts, read the second part after the negative spending, where it states clearly that the deficit has to be made up in better times. But when there were better times there also always was an idiot cutting taxes and increasing the debt.

The slowdown is simply caused by the fact that capital no longer trusts the US and therefore the capital holders refuse to invest. Can't blame them cause I been holding investments back for lack of foreseeable success too.

The solution? short term none, but 30 years of blood sweat and tears ( which is how long it will take the US to clean off all public and private debts, providing it would be willing to invest 10% of annual GDP in doing so) could create a brighter future for our grandchildren.

Edited March 1, 2008 by questionmark

[Aztec Warrior]

"Professor Stiglitz, an academic at the Columbia Business School and a former economic adviser to president Bill Clinton......Professor Stiglitz and another Clinton administration economist, Linda Bilmes, have produced a book"

Obviously no agenda here.

"The former World Bank vice-president yesterday said the war had, so far, cost the US something like $US 3 trillion

official figures do not include the long-term healthcare and social benefits for injured servicemen....Professor Stiglitz told the Chatham House think tank in London that the Bush White House was currently estimating the cost of the war at about $US 500 billion, but that figure massively understated things such as the medical and welfare costs of US military servicemen."

Classic...the guy is guessing! He takes the $500 Bill and adds $2.5 Billion for ESTIMATED future healthcare and welfare costs. What a shame, not to mention he doesn't address any of the real issues surrounding the slowdown, like the price of oil. Note the US is NOT in a recession, despite the ramblings of Paul.

Edited March 1, 2008 by Aztec Warrior

[acidhead]

Obviously no agenda here.

Classic...the guy is guessing! He takes the $500 Bill and adds $2.5 Billion for ESTIMATED future healthcare and welfare costs. What a shame, not to mention he doesn't address any of the real issues surrounding the slowdown, like the price of oil. Note the US is NOT in a recession, despite the ramblings of Paul.

The economy is in a recession.

1. The Fed continues to lower interest rates every few months to prevent a looming crisis.(credit collapse)

2. The American government continues to borrow money from China or who ever.

3. Then in turn the Fed continues to print fiat money(money with no backbone) out of thin air, give it to citizens and it injects into the market.

(does the recent 160 billion approved last month ring any bells? Will this injection 'stimulate'

the economy or merely stop some bleeding and panic temporarily?)

4. Most important is the devaluing of the 'Dollar'. The dollar is devaluing at an alarming rate.

When a market is flooded with an excessive amount of 'fiat' money it in turn devalues the current currency.

That last statement is simple economics and should be taken seriously.

How can this not be taken as a measure? Inflation is caused by a weak american dollar.

5. Most countries trade oil for American dollars, always have, yet that trend is in jeoprady as

an increasing number are opting to change towards a more stable and stronger currency

, the Euro.

6. The looming American financial crisis(depression) will create a ripple effect through out all of North America, this is a given.

The current monetary system has been broken, by design many will agree who study economics, to purposely devalue the

the 'dollar' spawning a brand new currency, the 'Amero'.( The North American Union )

If anybody has anything to add to this, I beg you, stay on topic.

The conversation get lost, time and time again, over name calling and ignorance.

It's important to understand the how, why's and what's led to the rise and collapse of the 'dollar' since the birth of America.

I suggest going to a library(or ebooks) and signing out a book that documents the history of economics in America since the signing of

the Constitution to grasp a keen understanding of how America has arrived to this point.

I've already suggested some great reads by Ron Paul yet his name continues to be belittled by a few here who suggest that

he is a 'fool' because he's run President under two different Party's.(This is when the topic becomes lost)

[questionmark]

It always amazes me when I see “backroom” economists, some of whom have high political offices, try to explain the economy.

So, let’s start with some basics, who controls the dollar’s value?

No, not the FED, the FED hardly has control of more than 1 percent of the dollars floating around the globe. The right answer is: Those who are in possession of dollars.

So, who is sitting on a big heap of dollars? The Chinese government and the governments of oil exporting nations come to mind.

Picture the problems of Sheik, lets call him Abdullah, sitting on a hoard of dollars. The things he needs and wants, Mercedes and Rolls Royce cars for example, have to be paid in Sterling and Euros. The Breitling watches have to be paid in Swiss Franks. But he still gets Dollars for his oil.

And nobody wants those dollars because they loose value quicker than a lame horse.

He could go and buy something in the States, but he -- or one of his competitors -- already owns everything that he wants and can be bought for dollars, like prime real estate in New York.

So, Sheik Abdullah has to go and exchange his dollars for other currencies. The problem is that there are many Sheik Abdullah trying to exchange dollars. As the dollar is a commodity with low demand and high supply the prices go down.

What can an American politician do about this? Nothing except to try to recover the dollars that Sheik Abdullah is sitting on by giving him something he wants in exchange.

And that does not include raising interest, because Abdullah’s problem is not that he does not have enough money . . . his problem is that he is not getting anything for it. And that is why his money is losing value.

To insure that at least his oil does not lose value at the same time he has to increase the price . . . which leads to a bigger hoard of dollars and a consequent devaluation.

And the moral of the story? Nobody tells Americans that they have to produce at least as much as they consume to stabilize the monetary value. Interest rates or tax breaks don’t do squid for those who have the dollars. Only producing items, that those who have the dollars want, will solve the problem.

Really simple....

And that is the real cause of the slowdown.

[Caesar]

Caesar,

Its very apparent that you're extremely confused on this topic.

yet,

Can you answer the following simple questions and prove me wrong? (stick to the question when answering)

You can even use google to find the answers!

1. Why does America, China, Canada and Japan purposely devalue their currency as you claim they do?

2. How is a currency devalued?

3. What causes inflation?

This may be difficult for you but try your best to stay on topic.

Based on your comments so far this little quiz will be laughable. LOL!!!

Good luck!

One more thing- STAY ON TOPIC..

It seem to me, that you and Ron Paul really don't know global economics.

1 )Why does America, China, Canada and Japan purposely devalue their currency as you claim they do? I think I've made this point in my other posts. if your nation has has a strong currency and is in trade battle with nations with a weak currency, it slows slows GDP growth, decrease business profits, and cause nations to buy their products and services because they have a higher purchasing power. its really common sense and the Japanese auto industry is a great example of this fact.

2)How is a currency devalued? by pegging their currencies bellow the U.S. dollar is the most common way. the U.S. usually increases the money supply or decreases interest rates.

3) What causes inflation? the most common way that cause inflation is to increase the money supply, it could also happen if you have a currency backed by gold and very little gold deposits are discovered even if your economy is great.

Now can you please tell me how I was off topic? the devalued dollar is why Ron Paul wants to bring back the gold standard. I'm no economist, but I have taken many economic courses. based on your posts, I think you should educate yourself before engaging into topics you really know nothing about, use facts and history rather then fear and ignorants.

[acidhead]

It always amazes me when I see “backroom” economists, some of whom have high political offices, try to explain the economy.

So, let’s start with some basics, who controls the dollar’s value?

No, not the FED, the FED hardly has control of more than 1 percent of the dollars floating around the globe. The right answer is: Those who are in possession of dollars.

So, who is sitting on a big heap of dollars? The Chinese government and the governments of oil exporting nations come to mind.

Picture the problems of Sheik, lets call him Abdullah, sitting on a hoard of dollars. The things he needs and wants, Mercedes and Rolls Royce cars for example, have to be paid in Sterling and Euros. The Breitling watches have to be paid in Swiss Franks. But he still gets Dollars for his oil.

And nobody wants those dollars because they loose value quicker than a lame horse.

He could go and buy something in the States, but he -- or one of his competitors -- already owns everything that he wants and can be bought for dollars, like prime real estate in New York.

So, Sheik Abdullah has to go and exchange his dollars for other currencies. The problem is that there are many Sheik Abdullah trying to exchange dollars. As the dollar is a commodity with low demand and high supply the prices go down.

What can an American politician do about this? Nothing except to try to recover the dollars that Sheik Abdullah is sitting on by giving him something he wants in exchange.

And that does not include raising interest, because Abdullah’s problem is not that he does not have enough money . . . his problem is that he is not getting anything for it. And that is why his money is losing value.

To insure that at least his oil does not lose value at the same time he has to increase the price . . . which leads to a bigger hoard of dollars and a consequent devaluation.

And the moral of the story? Nobody tells Americans that they have to produce at least as much as they consume to stabilize the monetary value. Interest rates or tax breaks don’t do squid for those who have the dollars. Only producing items, that those who have the dollars want, will solve the problem.

Really simple....

And that is the real cause of the slowdown.

Yes! Finally you're understanding how the dollar is being devalued!

Taken from my previous post:

"4. Most important is the devaluing of the 'Dollar'. The dollar is devaluing at an alarming rate.

When a market is flooded with an excessive amount of 'fiat' money it in turn devalues the current currency.

That last statement is simple economics and should be taken seriously.

How can this not be taken as a measure? Inflation is caused by a weak american dollar."

Now that this has happened how can it be undone?

First one must understand that the 'Sheik Abdullah' has always had his oil reserves 'protected' by foreign investors.

Many will agree that the form of protection has come from the American Military at the expense of American taxpayers.

When Bin Laden complained in the past because 'Sheik Abdullah' doesn't care about his middle class and poor, the rest of the world

didn't care, yet Bin Laden's response was to declare Jihad on American interests and people began to wake up, but only to the

propaganda the Western society is bombarded with by declaring that radical Islamists "hate our freedom" (complete b.s. when you break it down)

[Ron Paul, the "backroom" economist has written extensively about this for years now.

He has authored several books, dating back many many years, available to read for FREE online in the form of ebooks detailing American economics

and the history of American economics and their relation to the present looming crisis.]

That being said Dr. Paul has outlined a solution to the looming crisis and has detailed in point form how this can be undone.( I've included it already in

this another thread and I'll make it available right here: Here are the real, urgent economic solutions provided by Ron Paul that need to be implemented:

1. Tax Reform: Reduce the tax burden and eliminate taxes that punish investment and savings, including job-killing corporate taxes.

2. Spending Reform: Eliminate wasteful spending. Reduce overseas commitments(Retract the American Military Empire). Freeze all non-defense, non-entitlement spending at current levels.

3. Monetary Policy Reform: Expand openness with the Federal Reserve and require the Fed to televise its meetings. Return value to our money.

(GOLD STANDARD= Hard Currency)

4. Regulatory Reform: Repeal Sarbanes/Oxley regulations that push companies to seek capital outside of US markets. Stop restricting community banks from fostering local economic growth.

Ron Paul’s comprehensive economic revitalization plan is available in it’s entirety online at: http://www.RonPaul2008.com/Prosperity.

This raises your next question: Where do we get our oil and energies from?

Taken from Paul's website: http://www.ronpaul2008.com/articles/853/a-...et-in-gasoline/

Most Americans agree that the American economy should not be dependent upon Middle East oil. Economist George Reisman, however, explains that our own domestic regulations make us slaves to OPEC: “Today, it is possible once again to bring about a dramatic fall in the price of oil- indeed, one even larger than occurred in the 1980s. And it could begin right away. All that is necessary is to abolish the U.S. government’s restrictions on domestic energy production inspired by the environmentalist movement.”

Reisman also explains how abolishing restrictions on coal production, natural gas production, and nuclear power would further reduce the OPEC stranglehold. By increasing the supply of these other energy sources, demand for oil would decrease and prices would drop.

Note that much of the support for unrealistic environmental regulations comes from northeastern politicians and media, who weren’t nearly as interested in oil fortunes when the business hit rock bottom in the 1980s. Texas and the gulf coast have always been willing to supply the nation’s energy, and it’s a bit disingenuous to hear criticism from those who are happy to use oil but don’t want refineries in their backyards.

Oil is critical, but it is not a magic commodity that somehow is immune from the laws of economics. In fact, it is precisely because oil is so critical to our economy that we must allow the free market to deliver it. Absent government interference in the oil markets, gas prices would rise or fall according to concrete realities affecting supply and demand. High prices would encourage conservation better than any environmental regulations. Entrepreneurs would race to develop viable alternate fuels if gas prices rose too much.

[ships-cat]

I don't claim to understand all of the above, but I do wonder wether some posts are focusing on effects rather than causes.

All wealth is - ultimately - a measure of the ability to deliver goods or services. Everything else - interest rates, debt, exchange rates - is just ripples and reflections.

America's problem is that - increasingly - it is unable to deliver sufficient goods or services to meet its PURCHASE of goods and services.

Forgete about monetary policy; focus on productivity.

Meow Purr.

[acidhead]

It seem to me, that you and Ron Paul really don't know global economics.

1 )Why does America, China, Canada and Japan purposely devalue their currency as you claim they do? I think I've made this point in my other posts. if your nation has has a strong currency and is in trade battle with nations with a weak currency, it slows slows GDP growth, decrease business profits, and cause nations to buy their products and services because they have a higher purchasing power. its really common sense and the Japanese auto industry is a great example of this fact.

2)How is a currency devalued? by pegging their currencies bellow the U.S. dollar is the most common way. the U.S. usually increases the money supply or decreases interest rates.

3) What causes inflation? the most common way that cause inflation is to increase the money supply, it could also happen if you have a currency backed by gold and very little gold deposits are discovered even if your economy is great.

Now can you please tell me how I was off topic? the devalued dollar is why Ron Paul wants to bring back the gold standard. I'm no economist, but I have taken many economic courses. based on your posts, I think you should educate yourself before engaging into topics you really know nothing about, use facts and history rather then fear and ignorants.

1. The other countries mentioned don't purposely devalue their own currency; their currency is reflective on the value of the American Dollar.

America has always had the strongest economy of all the other countries. It's in every countries best interest to have a stable and strongest

currency they can get.

2. I highlited the area in your answer where you were correct.

3. I highlited the area in your answer where you were correct.

This is beginning to get very boring..

Bye.

[questionmark]

Yes! Finally you're understanding how the dollar is being devalued!

Taken from my previous post:

That is an excerpt of an article I wrote four years ago.

The point is that those things suggested by Mr Paul will do squat to solve the problem, what needs to be done is to produce something Sheik Abdullah wants, and that is not achieved by uping or lowering the interest rate nor by converting the dollar to gold standard. That is made by tightening the belt and starting up producing enterprises that produces items at the higher world standard.

The " recipes" of Mr Paul only lead to the situation as had: the American economy consists of selling houses to one another with money lend from Abdullah or China... and to pass their time American workers either flip burgers or build something that can hardly be sold in America. And to keep all happy we lower taxes and increase the national debt.

shesh... this is not something that you solve by passing laws, it can only be solved by getting down from the high donkey and see the reality.

[acidhead]

I don't claim to understand all of the above, but I do wonder wether some posts are focusing on effects rather than causes.

All wealth is - ultimately - a measure of the ability to deliver goods or services. Everything else - interest rates, debt, exchange rates - is just ripples and reflections.

America's problem is that - increasingly - it is unable to deliver sufficient goods or services to meet its PURCHASE of goods and services.

Forgete about monetary policy; focus on productivity.

Meow Purr.

From what I understand what you just said is correct.

While politicians, who will eventually will get in the White House, the arguments constantly debated are all about 'cause and effect'.

Yet,

The solution lies in understanding the Federal Reserves history and how it relates to the current Monetary Policies laid out by each New

Administration. Like any Corporation in business, running it to the ground only opens up avenues in other areas.

Unless new policies are adopted, both domestically and foreign, America will surely see a total collapse of the Dollar and a resulting total restructure

of economic policy in the country and surrounding countries like Canada and Mexico.

It's almost too ineveitable that we'll experience the rise of a North American Union and a new currency adopted by all three countries called the '

Amero'. One step closer to one world government.

Edited March 1, 2008 by acidhead43

[Caesar]

1. The other countries mentioned don't purposely devalue their own currency; their currency is reflective on the value of the American Dollar.

America has always had the strongest economy of all the other countries. It's in every countries best interest to have a stable and strongest

currency they can get.

1 America has the largest economy and the value of the dollar has little to do with it, 60% of of Americas large cap companies sales are from over seas. the strong dollar has hurt America for awile due to trade with nations purposely devalue their currency like China and Japan, making their products much cheaper for Americans.

2. I highlited the area in your answer where you were correct.

3. I highlited the area in your answer where you were correct.

This is beginning to get very boring..

Bye.

Rather then point out your lack of understanding on this topic and make these juvenile claims on what I'm right and wrong on, why don't you try to backup your claims?

Remember to stay to stay on topic!

[acidhead]

That is an excerpt of an article I wrote four years ago.

The point is that those things suggested by Mr Paul will do squat to solve the problem, what needs to be done is to produce something Sheik Abdullah wants, and that is not achieved by uping or lowering the interest rate nor by converting the dollar to gold standard. That is made by tightening the belt and starting up producing enterprises that produces items at the higher world standard.

The " recipes" of Mr Paul only lead to the situation as had: the American economy consists of selling houses to one another with money lend from Abdullah or China... and to pass their time American workers either flip burgers or build something that can hardly be sold in America. And to keep all happy we lower taxes and increase the national debt.

shesh... this is not something that you solve by passing laws, it can only be solved by getting down from the high donkey and see the reality.

Hey,

Sheik Abdullah loves blonde hair, blue eyed caucasian women!!!!! Oldest trade in the world!!!

Your last line was great!

I've gotta run,

Have a good day!

Bye.

[Caesar]

I don't claim to understand all of the above, but I do wonder wether some posts are focusing on effects rather than causes.

All wealth is - ultimately - a measure of the ability to deliver goods or services. Everything else - interest rates, debt, exchange rates - is just ripples and reflections.

America's problem is that - increasingly - it is unable to deliver sufficient goods or services to meet its PURCHASE of goods and services.

Forgete about monetary policy; focus on productivity.

Meow Purr.

I think its many things causing the slowdown in America.

1 economies all over the world have a bull and bust period and the U.S. is dew for a slowdown

2 I think the credit crisses caused by the fed has had a major impact on this economy

3 government spending and poor monetary policy

4 the emerging markets and the spike in commodities such as oil

5 trying to apply Keynesian economics and Laffers supply-side economics at the same time

I just thinks its odd how Bush is so gung ho about terrorism yet doe's nothing at our borders. or give this tax rebates to everyone, yet give no raise to those fighting over seas.

[questionmark]

I don't claim to understand all of the above, but I do wonder wether some posts are focusing on effects rather than causes.

All wealth is - ultimately - a measure of the ability to deliver goods or services. Everything else - interest rates, debt, exchange rates - is just ripples and reflections.

America's problem is that - increasingly - it is unable to deliver sufficient goods or services to meet its PURCHASE of goods and services.

Forgete about monetary policy; focus on productivity.

Meow Purr.

Looks like a working cat is faster at understanding economy than others trying to proselitize their ideas.....

[questionmark]

5 trying to apply Keynesian economics and Laffers supply-side economics at the same time

I would say, applying that half that gets votes of both economics....

[Caesar]

I would say, applying that half that gets votes of both economics....

You have some that plan on having a national healthcare plan and fight global warming and the other half that want to cut taxes across the board, you just cant do both at once, or do to much of one of them.