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View Diary: Libor --- OUTRAGE .... Please!!!! (210 comments)

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  •  If you consider that money is worthless, (8+ / 0-)

    then any charge for its use, over and above what it costs to handle the distribution and account for who got to use how much, is outrageous.  But, we've allowed a whole community of middlemen to blossom and grow by perpetrating the fiction that money has more substance than angels dancing on the head of a pin.

    Ever since 1971, when our currency was liberated from its attachment to gold, a relatively scarce mineral, there's been an effort to not only deny its worthlessness, but to retain control over who gets to use money for what. It's been a control issue, pure and simple, with some people believing that, if the quantity is reduced, what's left in the market is worth more. Other people decided that the currency could be used as a lever to speed up and slow the production of goods and services, only to have it demonstrated definitively since about 2000 that, while restricting the currency and the rate of flow can make the economy grind to a halt, pouring in more money won't make production start. Changing the direction of the economy can't be accomplished by throwing a lever.  Forwards is not a simple reversal of backwards.

    Whereas initial efforts to control the newly liberated currency resulted in the high interest rates of the early '80s and those rates proved counterproductive, lots of people were happy with the base rate of 8% set by the buyers of 30 year Treasury bonds in 1990, especially any "less safe" investment had to generate more interest.  But then, after the tech bubble collapsed and after most of our productive industries had been located overseas to generate high profits off the labor of foreign workers, the only apparent route to high profits in a short period of time was through a ballooning of the housing stock and a thinning of residential densities, until every able person was outfitted with a fixed cage, as well as one on wheels. But then, as always happens with goods, we arrived at market saturation and the residential bubble collapsed.  Never mind that the Sesame Street Generation doesn't even like living alone.

    If you think of money as just another standard of measure, like the inch or the centimeter, the notion that use should be associated with a cost, other than for keeping the standard constant, makes no sense.  Might as well charge for each letter used on this blog. Money is a public convenience.  Which does not, of course, preclude someone wanting to control and hoard and secrete it for their personal convenience. How else do we account for 30% of the U.S. adult population being functionally illiterate?

    People who can't read, can't manage their money either and that, of course, makes it easier to steal it from them.

    Willard's forte = "catch 'n' cage"

    People to Wall Street, "let our money go."

    by hannah on Thu Jul 05, 2012 at 03:01:26 AM PDT

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