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Pastimes : Clown-Free Zone... sorry, no clowns allowed

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To: Ilaine who wrote (106736)	6/5/2001 6:46:49 PM
From: yard_man	Read Replies (1) of 436258

>>But I think the matter was probably out of the power of the Federal Reserve to control, because I think - and this is a working hypothesis, subject to revision - that the main culprits were overproduction, tariffs, unproductive foreign loans, bank defaults, asset deflation, and a breakdown in the foreign exchange system. << I think all Tice and others are saying is: The above items were simply symptoms of a larger and earlier disconnect between banking policies and fundamental longer term economic constraints ... What's wrong with the Austrian's idea that investment must be supported by savings and not simply primed by credit unrelated to the same? Doesn't this make sense in a world of limited resources -- you can direct capital (economic resources such as labor, raw commodities, etc, -- not $$s) either to the satisfaction of current wants or further investment in productive capacity? And that these balances must needs be set by a marketplace and the only way to do that properly is for money / credit creation be constrained somehow by savings -- foregone current consumption? Certainly there is little of this relation captured in our current system, no?

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