How to convince People Like This User? Whose a FED backer?

[Give me liberty]

His not only a FED backer but also a believer in the US dollar is haven as in safe
Oh and a Paul hater.

Here are his quotes.

Nope. The US dollar is the ultimate safe haven and will be soaring in value as the Euro declines over the coming weeks and months. The Federal Reserve is not a significant problem at all. The major problem is the lack of Congress getting the budget balanced by cutting federal spending by around 40%. Federal spending in the US has soared from around $2.7 trillion in 2007 to around $4.0 trillion in 2012. That is the great disaster. The US economy needs to shrink at least 15% to get back to normal levels.

There will be no further QE and it doesn't make a hoot of a bit of difference anyway as all of the prior QE money just ended right back up in the accounts of the banks that got it at the Federal Reserve because LOAN DEMAND PLUNGED at the banks and there was no use for any further funds and so none even got out in the economy. I'd suggest you learn what QE is and what it does and what it doesn't do - and the same for Faber as he appears to be clueless.and the value of th S&P has nothing whatsoever to do with Federal Reserve policy.

Nope. QE DOES ABSOLUTELY NOTHING UNLESS THOSE FUNDS RE LOANED OUT BY BANKS TO CUSTOMERS. You are not comprehending that and neither are some others out there. I would strongly suggst you learn about what QE is and does and doesn't do. You also need to comprehend that the FOMC of the Federal Reserve said NO FURTHER QE at their meeting in January as they do comprehend how utterly useless it is. In any event, yields and interest rates WILL BE RISING as they are artificially low and RISK will be priced into interest rates particularly in Europe over the coming months and then into the US starting with municipal bonds which are now defaulting or an the brink of default at alarming rates.

Forex, the US dollar will be absolutely soaring on the DXY and against the Euro and the yen as both Europe and Japan come crashing down in their pile of bad debt. Expect the US dollar to soon be over 100 on the DXY.

So how would you wake him up?

[Paul Or Nothing II]

First thing, we have to understand that not everyone is going to agree with us, some people are just too stupid or they've perceived self-interest in keeping the system going so we can debate & discuss for a while but if they don't budge then just be polite & move on to the next person, there are plenty who'll agree with us on a lot of things, if not everything, if we properly approach the subject

With respect to your question, he obviously doesn't realize that Fed IS the reason why Congress is acting so irresponsibly because they know that Fed will step in buy their debt & thereby "monetize" it (inflate the dollar) if required, if there was no Fed then Congress would HAVE TO get the house in order because then the interest on Treasuries/debt will start going up & they'll have to cut back; with Fed in existence, they'll just keep on adding more debt & then Fed will keep monetizing & dollar will die a slow death - DXY is USELESS measure because it's measured against other equally bad, depreciating currencies so even if it went over 100, it'd just meant that other currencies depreciating faster but then dollar is depreciating ALSO

Price should be measure in something that will offer stability in long-term & can't be devalued by governments & banks by simply creating more of it

OIL priced in gold





NATURAL GAS priced in gold



Clearly, price of oil hasn't really gotten much off the ground after the collapse while natural gas is at its lowest, denominated in gold

And just look at how price of oil has hardly changed much over so many decades against the gold, that tells you how much dollar has depreciated!

By the way, he's partially right that the banks aren't lending but that doesn't mean QE won't increase moneysupply
Further, because banks aren't lending, moneysupply is collapsing & hence Bernanke (who believes Fed didn't increase moneysupply as much as they should during Great Depression) will try to re-inflate prices by expanding monetay base & he'll do that with more QEs, saying QEs don't add money is childish, if Fed adds $1, the banks can turn it into up to $10 through lending & re-depositing & re-lending (Fractional Reserve Banking) BUT if banks aren't willing to do that then Fed itself can directly issue $10 if they THINK its "right" & based on Bernanke's understanding of Great Depression then he'll definitely do that & he'll certainly HAVE TO that to monetize the debt as well so dollar is surely going to die sooner or later

This is why many central-banks around the world are buying gold now because the system based on dollar is on it's last legs & many countries are on the verge of dumping the dollar-standard due to continued devaluation for a long time now & even the IMF & other such supra-national entities are now looking at basing the system on a supra-national global paper-currency like "Special Drawing Rights" (google it) or something similar which will undermine the sovereignty of all the nations in the world & centralize the global monetary power, which is why US should try to move to TRANSITION to some sort of gold-standard ASAP

I hope you've told him that Ron Paul is the ONLY candidate that will cut spending for real & he even has a numbered plan to cut a trillion in the first year in office - http://www.ronpaul2012.com/the-issue...store-america/
So if he wants Congress to take the responsibility then electing Ron Paul as president would be best way for Americans to let the Congress know what they think about the debt

Further, if he still hangs on to Fed then tell him that Ron Paul will NOT end Fed overnight, he'll only allow people to use gold & silver as currency by repealing "legal tender laws" & taxes on gold & silver but Fed will still exist & so will its money, for a while to come
Here's Paul's full plan on brining in a MARKET-BASED gold-standard in parallel with Fed - http://mises.org/daily/2826

[ILUVRP]

p or n , you and i may disagree on crude oil trading , but i honestly feel very sorry for anyone that don't believe in Ron Paul.

no one will ever agree with 100% of any elected offical , but rp comes in at about 99% for me .

tell the person to just read the COTUS .

[Zippyjuan]

There will be no further QE and it doesn't make a hoot of a bit of difference anyway as all of the prior QE money just ended right back up in the accounts of the banks that got it at the Federal Reserve because LOAN DEMAND PLUNGED at the banks and there was no use for any further funds and so none even got out in the economy. I'd suggest you learn what QE is and what it does and what it doesn't do - and the same for Faber as he appears to be clueless.and the value of th S&P has nothing whatsoever to do with Federal Reserve policy.

Pretty much true- the Fed engaged in about $2 trillion worth of stimulus via purchasing securities (US Treasury notes and Mortgage Backed Securities) and the banks currently have about $2 trillion at the Fed in the form of Excess Reserves. It is not quite accurate that none of it got out into the economy but so far little of it has (and it could still wind up in the economy if companies resume borrowing from banks again). The money didn't get out in the first place because, as he says, demand for loans did plunge when the economy collapsed in 2008.

The Fed ended quantitive easing last June. At recent hearings, the Fed announced that they anticipate reducing their balance sheet over time which would mean probably allowing the securities to mature and not renewing them like they have been. Lately they have been rolling them over (on their Treasury holdings they are replacing the expiring or maturing Treasury notes with ones of longer terms- they had been purchasing mostly short terms ones). They are also rolling over on their MBS holdings.
http://blogs.wsj.com/economics/2012/...balance-sheet/

Testifying before the Senate Banking Committee, Bernanke said his goal was to eventually shrink the size of the Fed’s holdings and shift their composition so the central bank would only hold Treasurys. As part of its efforts to keep interest rates low and spur economic growth, the Fed has more than doubled the size of its balance sheet since the financial crisis after embarking on two rounds of bond-buying and purchasing mortgage-backed securities in an effort to support the weak housing market. The Fed’s asset holdings were $2.935 trillion in the week ended Feb. 22.

Contrary to what Ron Paul Or Nothing II says, the money supply has not been collapsing. Nor is the Fed buying gold (they don't have any now though they do store some of the Treasury's gold) and there is no plan to replace the dollar with SDRs which are made up partly of dollars (If you were to replace apples with apple pie could you do so if that meant you didn't have any apples left?)

By the way, he's partially right that the banks aren't lending but that doesn't mean QE won't increase moneysupply
Further, because banks aren't lending, moneysupply is collapsing & hence Bernanke (who believes Fed didn't increase moneysupply as much as they should during Great Depression) will try to re-inflate prices by expanding monetay base & he'll do that with more QEs,

The Fed has said they currently see no reason for any future easing or QEs though they will keep interest rates where they currently are for the forseeable future.

[thoughtomator]

reality will wake him up... try not to let him have anything around that's handy to commit suicide with when he gets reamed

[Paul Or Nothing II]

Pretty much true- the Fed engaged in about $2 trillion worth of stimulus via purchasing securities (US Treasury notes and Mortgage Backed Securities) and the banks currently have about $2 trillion at the Fed in the form of Excess Reserves. It is not quite accurate that none of it got out into the economy but so far little of it has (and it could still wind up in the economy if companies resume borrowing from banks again). The money didn't get out in the first place because, as he says, demand for loans did plunge when the economy collapsed in 2008.

The Fed ended quantitive easing last June. At recent hearings, the Fed announced that they anticipate reducing their balance sheet over time which would mean probably allowing the securities to mature and not renewing them like they have been. Lately they have been rolling them over (on their Treasury holdings they are replacing the expiring or maturing Treasury notes with ones of longer terms- they had been purchasing mostly short terms ones). They are also rolling over on their MBS holdings.
http://blogs.wsj.com/economics/2012/...balance-sheet/


Contrary to what Ron Paul Or Nothing II says, the money supply has not been collapsing.

Ok so one hand you believe that there aren't enough loans being given BUT you don't want to recognize that that's exactly what causes wider moneysupply to collapse

Nor is the Fed buying gold (they don't have any now though they do store some of the Treasury's gold)

Where did I say, "Fed is buying gold"??? Do you even read?

and there is no plan to replace the dollar with SDRs which are made up partly of dollars (If you were to replace apples with apple pie could you do so if that meant you didn't have any apples left?)

Yeah, & there was never a gradual plan for Euro & the European Union either, they just popped out of nowhere

Further, would you like to tell us the main function of SDRs?
Answer - They are used as "reserve currency" (although its "technically" not a currency) & destruction of the dollar (due to uncontrollable spending & debt & Fed-monetization) is becoming more & more obvious to the world, there's demand for a better alternative than "dollar-reserves"

And dollar's weightage within SDRs can be changed, hell, dollar MAY be thrown out altogether & more importantly, SDRs could easily be issued & accepted on their own without any weightage to any of the basket-currencies as all the major currencies are on the verge destruction because all of them are suffering with spending & debt problems

Just like FRNs didn't exactly become the main money immediately but simply represented gold & then gold-standard was demonized & gotten rid of & then Fed became the "default currency" even though it was no more backed by what once gave it value - in the same manner, even SDRs could become the "default currency" of its own once all other main currencies fail due to economic disasters & then the SDRs wouldn't need any backing of its constituent currencies

The Fed has said they currently see no reason for any future easing or QEs though they will keep interest rates where they currently are for the forseeable future.

Oh yeah, we should trust the Fed & government in general, & we should believe when they say inflation is low even though our shopping-exeriences say otherwise & that Fed is there to ensure low(high) inflation & high (un)employment & so on

He just doesn't want to say QE because when he does markets go crazy because they know inflation is coming but to believe that he won't inflate more with QE is childish - it's like when Nixon said he wouldn't resort to price-control & voila, a while later we'd price-controls, which didn't work at all but the point is that when a perceived crisis comes along even Bernanke will change his words & try to re-inflate the bubble

Bernanke & many mainstream economists firmly believe that falling prices, ie goods & services being cheaper, is bad They always on deflation deflation deflation but totally ignore the CAUSE, which is the preceding inflationary boom caused by overexpansion of credit by Fed & fractional-reserve-banking & then they take this bubble as the baseline & try to re-inflate & prevent the deflation that is moving towards the ACTUAL baseline, where the moneysupply & prices would've been had there not been an inflationary boom

Bernanke is someone totally believes that Fed caused the Depression by NOT inflating the moneysupply "enough" so as moneysupply contracts due to lack of lending, he'll try to make up for that by directly inflating the supply by buying Treasuries or whatever else he can get his hands on & when adds that to exploding spending & debt, you've great recipe for disaster

[Black Flag]

His not only a FED backer but also a believer in the US dollar is haven as in safe
Oh and a Paul hater.

Here are his quotes.

So how would you wake him up?

First, you should be very careful - because he is absolutely right in most of his observations. You will fall into a trap of debate where you -by assuming he is wrong- start flaying at his info, and he will hammer you as most of it is factual.

The US dollar is the ultimate safe haven and will be soaring in value as the Euro declines over the coming weeks and months.

Absolutely true.
Soaring in value relative to the Euro - though.

The Federal Reserve is not a significant problem at all.

This is his opinion, ignore it. You know better.

The major problem is the lack of Congress getting the budget balanced

This is true. As long as government is consuming the marketplace capital, it is a major problem.


Federal spending in the US has soared from around $2.7 trillion in 2007 to around $4.0 trillion in 2012. That is the great disaster.

True.
Ignore his opinion of what "level" it needs to be.

There will be no further QE

Opinion, who cares? He ain't Ben

as all of the prior QE money just ended right back up in the accounts of the banks that got it at the Federal Reserve

True.

LOAN DEMAND PLUNGED

Not true.
Demand is quite high - it is the banks that are not lending.

The banks have a choice - government T-bills or market loans - in an economy that is wild and crazy.
They are not lending to the market, and buying T-bills.


and the same for Faber as he appears to be clueless.

ahahhaah
A chump claiming a billionaire is clueless.



. QE DOES ABSOLUTELY NOTHING UNLESS THOSE FUNDS RE LOANED OUT BY BANKS TO CUSTOMERS.

True.
If it is all bottled up in the Bank Reserves, it has no economic effect.


So other than some opinion he threw out there, there isn't much wrong with his statements.

[Domalais]

He's almost entirely right.

If Congress waved a magic wand and eliminated the budget deficit overnight, plus some extra to begin truly paying down on the national debt, can you even imagine what would happen to the value of the Dollar?

[Zippyjuan]

Sorry I have not had time to reply to this thread earlier.

Ok so one hand you believe that there aren't enough loans being given BUT you don't want to recognize that that's exactly what causes wider moneysupply to collapse



Where did I say, "Fed is buying gold"??? Do you even read?

Let me start with this second one. From your previous post:

This is why many central-banks around the world are buying gold now

It is true that the Fed was not specifically named in that general "central banks" but they are the largest central bank.

Ok so one hand you believe that there aren't enough loans being given BUT you don't want to recognize that that's exactly what causes wider moneysupply to collapse

Lack of loans being made is why the QE the Fed put out there did not expand the money supply but the supply of money itself did not collapse. The velocity (which is a measure of how quickly money circulates) did collapse. If the velocity had remained what it was before the crisis, that money added would have exploded- and it still could do so since it is still at the banks (or rather mostly parked for now in their accounts with the Fed in the form of excess reserves).

So what did happen with the money supply in 2008? Did it really collapse? Let's take a look at M2, the most commonly used measure of money supply:

http://research.stlouisfed.org/fred2/series/M2

Further, would you like to tell us the main function of SDRs?
Answer - They are used as "reserve currency" (although its "technically" not a currency) & destruction of the dollar (due to uncontrollable spending & debt & Fed-monetization) is becoming more & more obvious to the world, there's demand for a better alternative than "dollar-reserves"

And dollar's weightage within SDRs can be changed, hell, dollar MAY be thrown out altogether & more importantly, SDRs could easily be issued & accepted on their own without any weightage to any of the basket-currencies as all the major currencies are on the verge destruction because all of them are suffering with spending & debt problems

Just like FRNs didn't exactly become the main money immediately but simply represented gold & then gold-standard was demonized & gotten rid of & then Fed became the "default currency" even though it was no more backed by what once gave it value - in the same manner, even SDRs could become the "default currency" of its own once all other main currencies fail due to economic disasters & then the SDRs wouldn't need any backing of its constituent currencies

Thank you for asking. Yes, I can provide more info on SDRs (or you could have googled it but that is OK). SDRs are comprised of four units of currency- the US dollar, the GB pound, the Euro, and the Japanese Yen- all of which are currencies you seem to be concerned may be headed for extinction. You are correct that the make-up of SDRs could change but it would be difficult for them to, as you suggest, work without the backing of any major currencies. It was once backed by gold, but the IMF does not hold vast amounts of gold. The IMF presently has about $160 billion worth of gold. http://www.imf.org/external/np/exr/facts/gold.htm

For more detailed info on SDRs, here is a link to the IMF which is responsible for them: http://www.imf.org/external/np/exr/facts/sdr.htm

The SDR is neither a currency, nor a claim on the IMF. Rather, it is a potential claim on the freely usable currencies of IMF members. Holders of SDRs can obtain these currencies in exchange for their SDRs in two ways: first, through the arrangement of voluntary exchanges between members; and second, by the IMF designating members with strong external positions to purchase SDRs from members with weak external positions. In addition to its role as a supplementary reserve asset, the SDR, serves as theunit of account of the IMF and some other international organizations.

The value of the SDR was initially defined as equivalent to 0.888671 grams of fine gold—which, at the time, was also equivalent to one U.S. dollar. After the collapse of the Bretton Woods system in 1973, however, the SDR was redefined as a basket of currencies,today consisting of the euro, Japanese yen, pound sterling, and U.S. dollar. The U.S. dollar-equivalent of the SDR is posted dailyon the IMF’s website. It is calculated as the sum of specific amounts of the four basket currencies valued in U.S. dollars, on the basis of exchange rates quoted at noon each day in the London market.

The basket composition is reviewed every five years by the Executive Board, or earlier if the Fund finds changed circumstances warrant an earlier review, to ensure that it reflects the relative importance of currencies in the world’s trading and financial systems. In the most recent review (in November 2010), the weights of the currencies in the SDR basket were revised based on the value of the exports of goods and services and the amount of reserves denominated in the respective currencies that were held by other members of the IMF. These changes become effective on January 1, 2011. The next review will take place by 2015.

All of the SDRs in the world today are worth a bit over $300 billion- that would have to be massively increased if it was to replace the underlying currencies and where would that come from if all the currencies collapsed?

Oh yeah, we should trust the Fed & government in general, & we should believe when they say inflation is low even though our shopping-exeriences say otherwise & that Fed is there to ensure low(high) inflation & high (un)employment & so on

He just doesn't want to say QE because when he does markets go crazy because they know inflation is coming but to believe that he won't inflate more with QE is childish - it's like when Nixon said he wouldn't resort to price-control & voila, a while later we'd price-controls, which didn't work at all but the point is that when a perceived crisis comes along even Bernanke will change his words & try to re-inflate the bubble

The Fed always announces its intentions ahead of time so that the markets don't get spooked and have time to plan for and react to what the Fed does. Both QE1 and QE2 were announced over a month before they started. To do otherwise would definately make the markets go crazy.

Perhaps I should add that I do have a degree in Economics.