Short insight. He makes a good point though. Why increase taxes if they can print? Or require taxes at all anymore if money printing is ok? http://www.traderdannorcini.blogspot.com.ar/2012/11/gold-sharply-higher-in-yen-terms-and.html?m=1
Because the Govts think that printing is a short-term solution to their problems. Taxation for most Govts is the norm. I'm not saying it's right, or just, or ethical or even touching that with a barge pole. I'm just saying that taxation is the norm, and they think that money printing will get them back to this norm of 'continual exponential consumer driven growth' again. In a few years time when Govts have completely destroyed their currencies and they have bigger messes on their hands, they might wonder where they went wrong.
At least some level of taxation is required to force the citizens to utilise the local currency without resorting to horrendous cost and outright governance at the point of a gun. In terms of new taxes, I haven't really thought about this before but I think it is probably because the fundamental mechanism that the Central Bank uses to release money (and the way the Govt obtains the money) is by a debt instrument. Like any business, the two organisations are keeping their books in order by paying homage to their credit/debit sides of theirs ledgers - eg paying interest on time, proving the debt repayments are manageable and generally acting like any other bank or debtor in the economy. So up until the point of outright Zimbabwe-style printing (which presumably requires a merging of the two entities and ignoring the accounting rigour altogether), the accountants on both sides still need to have the Government to have significant revenues (i.e, taxes). Hence, first stages are simply to make debt very cheap, to perpetually roll over existing debts (or in the case of Greece, write some off) and increase taxes.
Yeah that's a good idea. No income or other tax. (imagine how simple it would be). Just print the govt. spending money into existence, then everyone's money is inflated away at the same rate. The rich (cash holding) pay more taxes and the poor pay less proportionately. Clever people (like stackers) should hold their ground. Lets do it ! Bill
Imagine how fast the prices of everything would be going up. Might as well buy that stuff you want now because you know it is going to be more expensive tomorrow. In fact, might as well buy a lot of things now because you can re-sell them for more later. No point holding on to cash. Velocity of money goes through the roof. Wheelbarrows common at the grocery store.
^ and following that - the grocery store can't stock items because it has to pay the manufacturers for the goods before it can sell them - a major cashflow problem (and ironic too). People tend to forget about monetary velocity. From what I understand, and have read, monetary velocity can have the same impact as increasing the money supply. So if you have an increased money supply and increased velocity at the same time (in a feedback loop even), then the value of money approaches zero.
Always good to see the full quote every now and then. http://forums.silverstackers.com/topic-32236-civil-liberties-rest-upon-sound-money.html
It's interesting if you do an analysis of it By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. Check. The very definition of increasing gap between rich and the poor The sight of this arbitrary rearrangement of riches strikes not only at security but [also] at confidence in the equity of the existing distribution of wealth. Check. Over and over you hear criticisms labelled at money itself and the capitalist system as the reasons for the inequity Those to whom the system brings windfalls, beyond their deserts and even beyond their expectations or desires, become "profiteers," who are the object of the hatred of the bourgeoisie, whom the inflationism has impoverished, not less than of the proletariat. Check. Nowhere is this clearer than in Australia. Inflation has brought about great increases in the price of property. this has got to the point where it has divided Australian society. Those who got into property early have done much better than they could have imagined. Those who didn't deride those who did well for being evil speculators. They property people then deride those who haven't got it for being financially illiterate or lazy or expecting too much too soon or whatever. Just look at any thread in the RE forum. As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery. Becomes more true as each year goes by. Relations between debtors and creditors are at all-time lows and seem set to become worse. Debt itself is seen as the problem. The financial markets more and more resemble casinos. Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose. That would make approx 20 people in Australia. Not enough. And people go looking to the govt for answers. And the govt makes more and more laws. Meanwhile, the underlying disease, the monopoly rights of the govt to run the currency and the abuse that monopoly allows remains undiagnosed by the majority of society. Overall, quite depressing.
