From: Forrest Bishop (forrestb@ix.netcom.com)
Date: Sat Sep 02 2000 - 22:31:07 MDT
Forrest Bishop wrote:
>
> Transhuman Mailing List
>
> Richard Wentk wrote:
> >
> > Transhuman Mailing List
> >
> > At 17:10 2000-09-01 Friday, Forrest Bishop wrote:
> >
> > >Capitalism, or free markets, is the solution. The problems stem from
> > >Marxism's 'followers'...
> >
> > Capitalism is no more a solution than Socialism.
> >
> > Both are ideologies that had their peak in the 19th century, and are
> > looking more than a little dated now.
>
> Again, the word capitalism has been Orwelled into something else, so
> let us use "free markets" instead.
> Socialism is currently the leading "ideology" of the world: every country
> has a fiat-currency central bank, public education and a debt/welfare system.
>
> > Here's a different perspective:
> >
> > 1. ... Both lead
> > inevitably to ruling cliques where both resources and political power are
> > heavily concentrated. Put simply, the more predatory (and often paranoid
> > and insecure) humans tend to dominate the ecology. This is bad not for
> > moral reasons, but simply because it's *wasteful*.
>
> Just so. It is unfortunate but not inevitable, that the scum rises to the top.
>
> > 3. Both capitalism and socialism are forms of rationing, rather than forms
> > of cultural individuation.
>
> Rationing, or rather the distribution of available resources, is an essential
> quality of any organism, including an economy. Free markets using real money
> are the most efficient form of rationing that has yet been conceived. "Real
> money" means a commodity that cannot be duplicated or created out of thin air.
> A command economy, by issuing currency from nowhere, distorts the
> price-discovery
> mechanism that is critical for effective rationing.
>
> > Socialism damps the growth curve by instituting a reign of intellectual
> > mediocrity which stifles change.
>
> Just so.
>
> >Capitalism over-stokes the growth curve
>
> The business cycle, or boom-bust cycle, appears to be an artifact of
> fractional-reserve lending, or fiat-currency issue. The same dynamic was
> apparent at least a far back as the South Seas Bubble of 1721-3 (?).
>
> > and hides its fallout by shunting it to a slave underclass (such as
> > sweatshop workers in the 3rd world) and by playing games with illusory
> > fiat-money which has no physical foundation.
>
> Fiat "money" issued by a central bank is the antithesis of a free market,
> and therefore of "capitalism". It is a form of command economy, which is why
> Marx advocated it. A truely free market will either have free banking, or
> preferably no fractional reserve lending banks whatsoever. This of course
> requires a modicum of education among traders as to the history and nature
> of banking and money, which is entirely absent in the government-approved
> textbooks used in US public schools. This greatest of cons can only be pulled
> on the ignorant.
>
> For an excellent introduction to banking then and now, see
> http://www.usagold.com/halloffame.html
> particularly Arisotle and Aragorn III
>
> for the high-test, see ORO
>
> > 4. As for free markets - until such time as the planet's GNP is so huge
> > that rationing becomes irrelevant,
>
> This is not a possibility.
An expansion of the above, with facts and figures, is posted at:
http://216.46.231.211/credit.htm
The Credit Bubble Bulletin - by Doug Noland
On the Manipulation of Money and Credit
September 1, 2000
“Sooner or later, the crisis must break out as the result of a change in the
conduct of the banks. The later the crack-up comes, the longer the period
in which the calculation of the entrepreneurs is misguided by the issue of
additional fiduciary media (i.e., banknotes and checking accounts not fully
backed by money). The greater this additional quantity of fiduciary
money, the more factors of production have been firmly committed in the
form of investments which appeared profitable only because of the
artificially reduced interest rate and which prove to be unprofitable now
that the interest rate has again been raised. Great losses are sustained
as a result of misdirected capital investments.” Ludwig von Mises, Von
Mises on the Manipulation of Money and Credit.
...
Instead of understanding that a negative savings rate is indicative of a
severely distorted bubble economy, the bullish consensus sees the
continued borrowing and spending binge as evidence of a sound and
stable prosperity. It is this momentous gap between the perceived
supreme health of the current environment and the actual reality of
massive financial and economic imbalances that is disturbingly
reminiscent of the bubbles of 1929 in the U.S., 1989 in Japan, and 1996 in
SE Asia.
-- Forrest Bishop Manager, Interworld Productions, LLC Chairman, Institute of Atomic-Scale Engineering http://www.iase.cc
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