Re: Fables of the Greenspan

From: Don Galt (DonGalt_at_atlantis.colorado.taggart)
Date: 10/21/04 

Date: Thu, 21 Oct 2004 15:18:13 -0700

Andy F wrote:
> "Animaminima" <animaminima@yahoo.com> wrote in message news:<1098292556.845847.119410@z14g2000cwz.googlegroups.com>...
>
>>With crude oil at $54, gasoline well over $2 and not looking back,
>>gold at $425, silver over $7, the Euro at $1.25, and real estate
>>prices jumping 20-30% per year in civilized parts of the country, can
>>someone explain to me how the U.S. government can say there is no
>>inflation and and keep the prime rate down around 2%? Is this bull***
>>or is it bull***? I'd like some explanation.
>
>
> There isn't really a single variable called 'inflation'.
\

This is in error. There IS one variable that is inflation. There are a
couple different measures of it, the CPI not being one of them.

There is M1 inflation. There is M2 inflation. There is M3 inflation.

All three measure inflation of the money supply, broken down by types
of money. (EG: Checking account entries verses physical dollars, for
instance.)

THIS is inflation.

> Some prices
> are going up and others are going down.To measure the 'rate of
> inflation' you have to use some sort of average or index. Which index
> you use depends to some extent on value judgements.

No. This would not measure inflation-- it would measure prices. Notice
what it is direcctly measuring-- PRICES.

PRICES and PRICE CHANGES ARE NOT INFLATION.

Inflation causes price increases, eventually. But it is not the same thing.

> The CPI has been generally accepted for some time as a reasonable
> estimate of the 'cost of living.'

Only by the uninformed. The CPI is used by the government to
propagandize thru CNN, et al. that inflation is low. To do this, they
don't even really use an index, and they change the components of it at
will, re-price things, etc. For instance, they asume peopl buy a
computer every year and that the price of a computer is measured in
clock cycles. Therefore, even though a computer may cost $1,000 in 1995
and $1,000 in 2000-- they will say the computer price has gone down by
thousands of percent--- computer technology alone has been keeping the
CPI low for almost a decade now.

Meanwhile, actual inflation, and the actual average gropwth in prices
people have been paying has been much higher-- %7-%9 under Clinton,
%10-%11 under Bush.

> Having said that, it's much more fun to blame everything on an Evil
> Conspiracy.

Your economics in this area is a little weak-- but most americans have
been taught falsehoods. It takes awhile to unravel what's really going
on, but it really is a conspiracy, and they don't even hide it. Go look
at the annual report of your local federal reserve branch. Notice there
is no gold on their books. Notice that there are gold certificats--
which are really loans. That is to say, the bought the right to get gold
at some future date. Where is the reserve in the Federal Reserve that
backs the dollars? There is none-- if you look at their annual report,
you will see that they show the dollars out intheir regional economy as
a liability, which is correct, but they have nothing on the asset side
of the eqation that is not denominated in dollars to balance it out--
which means they have dollars - liabilities to balance the liabilities.
  (Excluding the small amount of gold certificates I mentioned which,
again are not real gold, but a gold liability.)

Think about that. What is a dollar? Its paper that's a sotre of value,
right? Where's the value? What's it redeemable in?

It used to be silver. Now it is nothing.

THAT is a massive fraud, and it was done by many people, in secret. Its
a well documented and proven conspiracy.

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