Quote:You mean like we did last time? Trust me... Obama is the new FDR.
First off, of course I'm not going to trust you. If I did, why would we spend all this time disagreeing? B)
Second, if FDR broke the back of the US economy, he did a piss poor job of it. The years following FDR were the best the US has ever had. During his time in office, the great depression turned around, the largest war in history was won, and the groundwork was laid for the postwar boom. If Obama is the new FDR, then I don't think you have much to worry about.
Quote:The reason they did it was that the currency became worthless, and their utter hatred of greed and status based upon the amount of money one has. The objective is to crush the greed from the bourgeois.
Well, you can play pop psychology with them, I guess. My theory is that they wanted to skip towards the "full communist" stage of the revolution, assuming that money was a pernicious remnant of bourgeois government. In defense of this, and contrary to your argument, one might notice that by the time the Soviets (or Cubans) banned money, they were already in full control of the state apparatus, and had completely destroyed private property. What need was there to "crush the greed from the bourgeois", when you've already crushed them utterly?
Quote:I believe he thought inflation was bad for the proletariat.
... and good for the bourgeoisie. Which, when your primary analytical unit is the social class, which you believe 100% determines the system of governance, means that he believed inflation was good for capitalism (the government of the bourgeoisie) and bad for socialism (the government of the proletariat.)
Quote:When the private sector refuses to invest(spend), then according to our current government, the State has the responsibility to "stimulate" the economy by going on the largest spending bing in the history of government spending.
If there is anything at all to Keynes' theories, then this is precisely the case. If each investor, looking to protect their own wealth, jumps out of investment and into commodities or foreign currencies, then industry grinds to a halt. People lose jobs and therefore income, the economy worsens, prices drop, and this leads to even less money available for investment, and so forth. Deflation sucks. The only ways to get out of this trap involve someone spending money. That means either dropping the interest rate so unbelievably low that there is no risk to investment (which is being done, to apparently quite little effect), or the government pumping money into the economy.
Quote:How close are we to having "zero" interest rate? Get your rapidly depreciating dollars ready for that currency killing. I'd suggest investing in the Yuan.
I thought you were the one who was the big advocate of the Chinese keeping the Yuan down, in which case it wouldn't appreciate... and I also hold exactly zero US dollars.
The whole idea of the liquidity trap is that the gears have stripped from the interest rate crank. The Fed has lowered interest rates down to almost absurdly low levels, and yet lending is not going back up. I'm not sure I believe that the liquidity trap is true in this case, but it is one possible way that the value of the currency might not be so very predictable.
-Jester