How does printing money shrink the middle class?

[harikaried]

If you look at wealth distribution graphs in the US, it would probably skew towards the majority (50%+) of the money going to a relatively small percentage of the population.

But if money is printed, which devalues the dollars everyone holds, wouldn't this mean that relatively small percentage is taking more of that lost value impact? The other side of printing money is the receiving end which is a tiny percent of the population, so those people getting access to the money first move up relative to everyone else.

I suppose another argument is that the Fed sets interest rates artificially low, so savers don't get as much, but I'm not sure how that specifically ties into the middle class.

[TruthisTreason]

If you cannot save capital to invest, you will always be more/less a laborer.

[TheGrinch]

When you've got millions and billions, they can devalue it all they want, but it's gonna take a hell of a lot for it to actually hurt me in comparison to you (creative investments make that even moreso as they have more options for investment than just currency, unlike most of us). But does it really matter if your currency is devalued if you're that rich and are still making money?

No, of course the brunt is exponentially towards the little guy who holds fewer, as his dollars get stretched thinner with his finite supply (as opposed to pretty much infinite when you get to a certain point).

Thus, the middle class sees their wealth diminished and moved closer to the lower class, much moreso than those at the top are moved towards them, where it's like scraping icing off a cake. They're still rich at the end of the day, but you might not be if your family has had a century's worth of up to 95% of their savings being devalued as everything else gets inflated in cost.

Just because it's called the middle class does not mean that it's just as close to upper class as it is lower class. It will always be closer to the lower class numerically because the other way goes towards infinity. I mean, sure "upper class" or upper-middle-class can still feel a real effect from things like inflation, of course, but they aren't the ones setting policy, printing money, and adding to their "devalued" bank accounts.

[harikaried]

If you cannot save capital to invest, you will always be more/less a laborer.

Accumulating savings and investing are two separate things, although I suppose if savings accounts don't appear desirable, people might tend to spend now instead.

But just because the Fed sets interest rates low doesn't mean people won't put money in equities or bonds. Although risks of various types, e.g., market and time, might also push people to not bother and just spend the money now.

[harikaried]

does it really matter if your currency is devalued if you're that rich and are still making money?

Hrm.. that's interesting. So with this reasoning, it seems safe to say printing money affects the rich (those who aren't receiving the printed money) more than the middle class, but the middle class notices the effects of monetary inflation most because there is less wiggle-room.

[erowe1]

Good question.

Also, what does the size of the middle class have to do with anything anyway?

[Steven Douglas]

Aside from home ownership, most of the middle class uses credit for consumption, not production. That is the key difference, I believe. If you aren't going into debt specifically for the purpose of staying ahead of the price inflation treadmill, you're faced with a double whammy. Not only is the value of your savings diluted like everyone else, but you're incurring interest payments for things that aren't making you any money at all.

Being on first-receiver end of new debt-money distribution is only a real advantage for those who use credit for the specific purpose of production, and who are using it for costs of production that involve markups and profits. Part of the profits of are siphoned back into the commercial lending coffers, of course, but with wise enough management, and strong enough production, producers can and do stay ahead of the inflation curve by using credit.

With the exception of the struggling middle class entrepreneur, middle class individuals with good credit ratings and active revolving accounts are THE prime targets for systemic shearing on all fronts, public and private, especially in our stay-ahead-of-the-Jones culture. The price advantage from "first-receiver" status isn't much, because it's almost exclusively toward some form of retail consumables, including new goods that are already marked up to the hilt to beat past inflation (cars, household appliances, computers, etc.,). As end users, not only is no value being added and passed on to anyone else, the goods and services received invariably, rapidly and substantially depreciate in value. Advantage: negative, and the middle class are eroded twice as fast by the invisible tax on their currency holdings, in addition to the visible tax of interest paid.

Our entire Ponzied-debt system REQUIRES perpetual exponential growth to be sustainable. An impossibility, of course, as its mortality and ultimate collapse is a mathematical certainty, but the time required for collapse is in direct proportion to the size of the economy, and specifically the size of the money base. For Zimbabwe and elsewhere everything happens hard and fast. In our case, successful currency debasement spans generations, which lulls most people into believing, deep down inside, that if it's gone on for a hundred, sixty, or even forty years, there's no reason why can't go on forever - even if prices do rise. Meanwhile, the rule of the day is ADVERTISING, everywhere you look, with politicians talking about "GROWING" the economy. Not sustaining, but rather "sustaining growth". Everywhere you look, consumers are being blamed for not consuming enough. And who better suited for that blood-sucking, wealth-draining exercise than the vain suckers, less of whom are born each minute, in the ever-shrinking middle class.

[oyarde]

There is no middle class . There are those who pay Federal tax ( Meh, without checking , say 52 % ) , there are those who get things from those taxes paid by the productive ( again, meh , say 48 % ) , who do you think that 48% tax ticks vote for ? Now , after nearly 50 years of the " not so great society : , if you expect to defeat the tax ticks , you need every vote from those who are stolen from , is that going to happen ? Middle class is some retarded Joe Biden myth , like unicorns ? ever seen one ?? I believe in Bigfoot , JFK conspiracies and that I may quit drinking & smoking more than I believe in "middle class " . There is no middle class, there are those who believe they might like to be and there are those who understand we are past the point of this ridiculous type of classification .

[Nickels]

If you cannot save capital to invest, you will always be more/less a laborer.

how is keeping people laborers and not letting them go white collar "shrinking the middle class"?

[The Gold Standard]

When new money is created the people that get it first get the opportunity to use it before that money has driven up prices. Who gets that money first? Wall Street bankers and the federal government. By the time that money trickles down to the working class it has already bid up prices wherever it was spent, leaving you and me with near worthless paper.

[KingRobbStark]

Hrm.. that's interesting. So with this reasoning, it seems safe to say printing money affects the rich (those who aren't receiving the printed money) more than the middle class, but the middle class notices the effects of monetary inflation most because there is less wiggle-room.

Printing money effects those who receive it last. The devaluation of the dollar occurs only after it has been widely circulated.

[RickyJ]

They are not taking more of the loss of value because those in the top 1 percent diversify out of the dollar. Very few keep large amounts of cash sitting around. Only cash is devalued by the printing of money, not assets. The top 1 percent do not work for a salary, so their pay is not cut like the everyday worker's pay is cut by the printing of more money with nothing to back it up.

[VIDEODROME]

Some people I talk to think the answer to this is just tax the rich more and the middle class less. I keep have this feeling that is like patching hole on a dam this is falling apart.

I would like to hear input on the supposedly dreaded alternative of Deflation. Some people find that situation alarming and it probably does come with it's own strange problems. However, I kind of wonder if that would in fact increase the purchasing power of the lower income earners and retirees. Granted any with credit card or other debt will face almost certain bankruptcy.

One would think the rich would benefit as their savings increase in value, but owners of corporations would be in an awkward positions and prices must necessarily fall. Also, I know economists piss and moan saying the consequence of this will be less consumer spending when people realize their saved money will increase in value.

I suppose both Inflation and Deflation are actually bad, but I sometimes wonder if a Deflationary Correction can unwind the monetary tampering. I'm probably still very much a layman on this so I'm curious what others think. I also find the link between the Fed, Interests Rates, and the Economy strange.

[VIDEODROME]

They are not taking more of the loss of value because those in the top 1 percent diversify out of the dollar. Very few keep large amounts of cash sitting around. Only cash is devalued by the printing of money, not assets. The top 1 percent do not work for a salary, so their pay is not cut like the everyday worker's pay is cut by the printing of more money with nothing to back it up.

If someone has an offshore account might it also be in another currency? Would it be shielded from the Fed that way?

[Nickels]

Printing money effects those who receive it last. The devaluation of the dollar occurs only after it has been widely circulated.

exactly. in other words, they can print all the money they want, but until its pumped into the pipeline, it won't affect anybody.

[Nickels]

I suppose both Inflation and Deflation are actually bad, but I sometimes wonder if a Deflationary Correction can unwind the monetary tampering. I'm probably still very much a layman on this so I'm curious what others think. I also find the link between the Fed, Interests Rates, and the Economy strange.

everything is bad when you're on the wrong side of the equation. If a commodity appreciates, you want to be the holder and seller, not buyer. And vice versa.

[rpwi]

To a certain extent the wealthy can pass on inflation to consumers. Most of the wealthy individuals in this country are investors in businesses. These businesses can merely raise prices during inflation so it doesn't hurt them as much. For middle-class individuals, their ratio of consumption to investments is much higher, so they are the ones that get nailed.

Also when the fed creates more money, they allow the banks to create even more money with the money multiplier (which magnifies inflation). Because bank money is backed by debt...this means the middle-class (not the rich...they don't need the debt...not the poor...they can't afford the debt) will be saddled the worst.

[Tinnuhana]

Anybody here read Schiff's How an Economy Grows and Why It Crashes? Pretty easy-to-understand explanation of the background economics to your questions.
Part of my take is that the beneficiaries of the banks' fiat largesse get to use it before the effects of its printing (inflation) take place. (Trickle down inflation?)
The evils of delfation is a Keynesian myth based on their beliefs about manipulating the economy/markets. On the other hand, it's been said that deflation is part of the sometimes painful correction. The housing bubble is instructive. Now that the bubble has burst, people who've saved can actually afford a house. The pain, in my case, was that I bought in 2005 and three years later, the thing is worth only half what I bought it for. But I bought it to live in, not to flip, so I can be jealous of the people getting the good deals now, but I still have a roof over my head.
It's important to remember that in the Austrian Economics view, inflation is the creation of fiat money, not the rise in prices, which is a result of inflation. That's how we know that every QE-Whatever is going to result in higher prices down the line. It's just a matter of time. But, I'm just a neophyte at this, so don't take my word for any of this.

[MoneyWhereMyMouthIs2]

It's important to remember that in the Austrian Economics view, inflation is the creation of fiat money, not the rise in prices, which is a result of inflation. That's how we know that every QE-Whatever is going to result in higher prices down the line. It's just a matter of time. But, I'm just a neophyte at this, so don't take my word for any of this.

Economists often sidestep definition discussion by calling the latter "price inflation" or "consumer price inflation."

Austrians are philosophers for the most part, which is why they have a definitional difference and don't quantify much. A lot of mathematicians entered the field of economics at some point, and so they have a need to quantify - this is why price inflation matters to them, CPI, etc. They want equations they can plug actual numbers into, and make predictions with mathematical models, where the Austrian school is more concerned with logic. Those groups usually coexist just fine and reach the same conclusions. This is lost on a lot of people as they fall into the austrian versus keynesian debate. Then it gets further confused when they start talking "austrian versus mainstream economics (keynesian)" since a keynesian view is not required for a useful economics education - math and all.

[seraphson]

I'm a little confused on one thing. Navigate to this page and scroll about a little past half way to view the flash animation.

It shows the cycle of principal being issued while being able to pay principle + interest. It says this is possible if interest is 100% recycled. But that doesn't quite make sense to me. If I loan you $5 and I expect $5 + $1 interest how does recycling the interest mean I get $6 from a loan that only created $5?

[The Free Hornet]

I would like to hear input on the supposedly dreaded alternative of Deflation.

It's time to ask an expert:

There are actually three different reasons to worry about deflation, two on the demand side and one on the supply side.
...
So first of all: when people expect falling prices, they become less willing to spend, and in particular less willing to borrow.
...
A second effect: even aside from expectations of future deflation, falling prices worsen the position of debtors, by increasing the real burden of their debts.
...
Finally, in a deflationary economy, wages as well as prices often have to fall – and it’s a fact of life that it’s very hard to cut nominal wages — there’s downward nominal wage rigidity.

krugman.blogs.nytimes.com/2010/08/02/why-is-deflation-bad/

Seems that he is saying deflation would be inconvenient to those who would be our masters.

[Steven Douglas]

I'm a little confused on one thing. Navigate to this page and scroll about a little past half way to view the flash animation.

It shows the cycle of principal being issued while being able to pay principle + interest. It says this is possible if interest is 100% recycled. But that doesn't quite make sense to me. If I loan you $5 and I expect $5 + $1 interest how does recycling the interest mean I get $6 from a loan that only created $5?

It's all a function of time. Because you (the bank) aren't keeping the interest, but re-lending or spending it back into the economy, and because the borrower has a long term payment schedule, there is theoretically enough time for that interest to recycle throughout the economy, and eventually return to that same borrower so that you can receive that same money back again as interest.

There are two paths to deflation:

1) Don't recycle the interest, and all principle loaned eventually flows back into the banks as interest, as all currency is siphoned out of circulation.
2) Don't increase the rate of DEBT GROWTH, which is required to insure that past loans can be repaid with ever-cheapening currency.

Number 2 is the entire key TO ANY BUBBLE, including the entire system-wide inflationary bubble where everything is systemically overvalued, as steady, perpetual upward pressure on all PRICES are encouraged by way of a fiat currency of steadily falling value.

Without interest recycling (i.e., the banks just hold onto all interest) the P+I payments to the bank would act as a one-way currency siphon into the banks, and ALL currency would disappear from circulation, as the entire system would be in a state of rapid deflationary collapse. Recycling of interest provides just one of the mechanisms for a delay of that inevitable.

The real question is: Does 100% interest recycling mean that the aggregate debt could be repaid, in theory (principle plus interest over time), in an economy where the GROWTH OF DEBT does not increase? The short answer is absolutely not. To not recycle interest would mean deflation. Simply recycling interest is not sufficient for the aggregate debt to be paid. Increased rate in the growth of debt (plus aggregate interest required to pay it) is still very much required, precisely because it is inflationary. Inflation is required so that the older debts can be retired with depreciated currency. A freeze in debt growth would ALSO result in deflation, which means falling prices in the face of loans and payment schedules that are nominally fixed.

The banks would love nothing more than to receive currency that is of greater value than what they loaned out. IF that was possible, and IF it actually worked that way. The reality, however, is what we see in any crashed bubble, where people are upside down in their loans, trying to pay for overvalued assets, and bankruptcies and failures are the result. Multiply that system-wide in the case of deflation. Nobody would be able to service their debts in a rapidly appreciating currency. Indeed, nobody would want to borrow any money. Suddenly, savings is strongly encouraged, with with borrowing discouraged (credit both more difficult to obtain and not as desirable). Everyone will hold onto their currency (SAVE) which is rising in value, and cut out the banks as a middle man. Privately accumulated capital (SAVINGS) becomes king.

The Fed/Keynesian view favors a system that favors banks over REAL PEOPLE SAVING, with the idea that while banks will "recycle" in the face of inflation, PEOPLE will only "HOARD", and savers are vilified as just that: hoarders. The other Keynesian vilification of REAL INDIVIDUALS as economically incorrigible comes from the dreaded "sticky wages", where laborers will resist receiving lower wages in the face of an economy where other all prices are falling. Oh, the horror. Can't have that happen. That could result in layoffs (OH MY!) and unemployment (OH MY!).

In a free market/sound money economy (that does NOT exist today), banks would just be another market participant, nothing more, with no skyscrapers in every downtown city. They would be relegated back to the average merchant class they once were, with whom all savers actively compete (and must be cooperated with and actually enticed to cooperate with the banks). The entire system is deliberately inflationary to prevent that very market dynamic, and to cut out savers who would otherwise increase the value of all other currency in circulation -- to the detriment of lenders only.

[Boss]

The wealthy have invested their cash into assets and businesses.

Printing money leads to inflation. In the simplest of terms, inflation is when prices go up.

So the prices of assets go up, the prices of the services rendered by business go up, the prices of the goods produced by businesses go up. This is the same as the value of the dollar going down.

The wealthy don't suffer the devaluation of the dollar because the percentage of their wealth held in dollars is much less than everyone beneath them financially.

[Knighted]

So first of all: when people expect falling prices, they become less willing to spend, and in particular less willing to borrow.

In the short term only. People will not hoard their money forever. What deflation WOULD do is increase the savings rate, because it would temper the drive created by inflation to spend as quickly as possible and even borrow and spend (since borrowers benefit in an inflationary environment when the dollars they must repay are worth less than before) With a greater savings rate, we would see much greater investment, and investment is truly the foundation that long term economic growth is built upon.

A second effect: even aside from expectations of future deflation, falling prices worsen the position of debtors, by increasing the real burden of their debts.

This is true. Krugman is right every once in a while, just like a broken clock. But as debtor positions are worsened, it sends a powerful message that excess debt is a terrible and destructive thing to accumulate. Those affected (through bankruptcy, personal austerity, and hard times) are unlikely to ever make that mistake again. And when large swaths of the population become debt averse, the economy becomes much more stable.

Finally, in a deflationary economy, wages as well as prices often have to fall – and it’s a fact of life that it’s very hard to cut nominal wages — there’s downward nominal wage rigidity.

Wages would only need to fall when the deflation is based upon a contraction in the economy. In normal economic times without Fed intervention, deflation would naturally occur at small rates due to productivity increases. Wages would not need to fall in those circumstances.

What Keynesians and fools like Krugman really stand for is the refusal to take the bad tasting medicine. They've become arrogantly intent on "saving" the economy through intervention, preventing recessions from fully wringing the excesses out of the system, and in the process they have set the stage for a giant collapse at some point in the future.

[Steven Douglas]

^^^ This.

What Keynesians and fools like Krugman really stand for is the refusal to take the bad tasting medicine. They've become arrogantly intent on "saving" the economy through intervention, preventing recessions from fully wringing the excesses out of the system, and in the process they have set the stage for a giant collapse at some point in the future.

Exactly. Inhaling=good, exhaling=bad, or "Going up is so good that it must continue to go up, and must never come down." (On your grandchildren's heads, OK, but not on us. That would be bad.)

[Bohner]

When money is first printed, the value of the currency does not depreciate right away. It's after that money begins to circulate the economy when the currency depreciates. So when a person takes out a loan (which comes from the fed's printing press), that money that person just borrowed is worth just as much as the money in the rest of the economy which hasn't yet depreciated. However, once that person begins to spend that money, and that money begins to circulate, the value of the currency depreciates and that money that person just borrowed is worth less than when he had it.

Now keeping this in mind, who are the recipients of the lion's share of loans via printed money? Rich people. Rich people borrow much more money than poor people. So rich people borrow money when the currency is strong, once the money circulates and trickles down to the middle class, that money is now worth less than when it was in the hands of the rich person who took out that initial loan. Rinse and repeat

So rich people benefit by getting hands on the money when the currency is strong, by the time the money trickles down to the middle class, that money is now worth less. Add this to the fact that the value of savings depreciates and it's easy to see how the middle class gets $#@!ed over.

[NoOneButPaul]

When new money is created the people that get it first get the opportunity to use it before that money has driven up prices. Who gets that money first? Wall Street bankers and the federal government. By the time that money trickles down to the working class it has already bid up prices wherever it was spent, leaving you and me with near worthless paper.

The simplest, easiest, explanation in the thread... ^ this basically answers your question.

When money is first printed, the value of the currency does not depreciate right away. It's after that money begins to circulate the economy when the currency depreciates. So when a person takes out a loan (which comes from the fed's printing press), that money that person just borrowed is worth just as much as the money in the rest of the economy which hasn't yet depreciated. However, once that person begins to spend that money, and that money begins to circulate, the value of the currency depreciates and that money that person just borrowed is worth less than when he had it.

Now keeping this in mind, who are the recipients of the lion's share of loans via printed money? Rich people. Rich people borrow much more money than poor people. So rich people borrow money when the currency is strong, once the money circulates and trickles down to the middle class, that money is now worth less than when it was in the hands of the rich person who took out that initial loan. Rinse and repeat

So rich people benefit by getting hands on the money when the currency is strong, by the time the money trickles down to the middle class, that money is now worth less. Add this to the fact that the value of savings depreciates and it's easy to see how the middle class gets $#@!ed over.

To complicate things let's think about it like this...

Let's say there's 100 trillion dollars in the money supply and a gallon of milk with that supply costs 1 dollar.

For whatever reason (bailouts, warfare, welfare, stimulus, whatever) the federal reserve prints up 10 trillion dollars.

Now there's 110 trillion dollars in the money supply, BUT (and here's the key) because the Fed has almost 0 oversight and can essentially create this money out of thin air and throw it where it wants the masses have no idea what's going on...

Let's take for example a small-time shopkeeper who is still selling his milk at 1 dollar a gallon...

Because John Q. Shopkeeper doesn't know the 10 trillion has been created he's unable to recognize that he needs to start charging 1.10$ for his milk.

The well-connected person- banker, politician, war-profiteer, whoever- now starts to spend the new money. Now whatever he buys (milk, eggs, gold, guns, whatever) he understands he's getting it at a discount because the shopkeeper is still left in the dark about the newly created money thus he's unable to readjust his prices properly.

So the well-connected consumer buys his milk at 1$ and the shopkeeper is now losing .10$ on each sale and he's got no clue of it.

^That's how small, less connected, businesses get wiped out and that directly effects the middle class... so there's that... but there's more...

As the more well connected continue to buy their milk at 1$ eventually the money trickles down to the upper classes, middle classes, and lower classes and more people become aware of the new money's existence. As more people become aware of the new money people like John Q. Shopkeeper finally start to come to the realization they need to reevaluate their prices.

Let's say the 10 trillion was made on December 31st...

On Jan 1st the well connected buy their milk for 1$
-The money trickles down and more become aware of it... the John Qs readjust...
On Apr 1st the upper class now has to buy it for 1.03$
-The money trickles down and more become aware of it... the John Qs readjust...
On July 1st the middle class now has to buy it for 1.06$
-The money trickles down and more become aware of it... the John Qs readjust...
On Oct 1st the lower class now has to buy it for 1.10$
-The entire nation is now aware of the new money and EVERYONE is now paying the proper price of $1.10- the price everyone should have been paying to begin with on Jan 1st.

But this realization in October won't change the fact that the people who got the newly created money in January ultimately got their milk for 10cents cheaper than they should have for 3 months- then 7 cents cheaper for another 3months- then 4 cents cheaper for another 3. They SAVED on Milk unjustly for 9 months.

The upper class saved on milk unjustly for 6 months (7cents to 4 to 0)
The middle class for 3 months (4cents to 0)
The lowest class never got to save at all; they get $#@!ed more than anyone because by the time the money reaches them EVERYONE knows about it and readjusts the prices.

The lower down you are the less you save, and the more well connected you are the more you save.

But wait, there's more...

AT THE SAME TIME that Middle Class-Small Time John Q. Shopkeeper was, for 9 months, losing money on all the milk he was selling his savings account, which lets say for the entire 9 months had 100k in it, now has the purchasing power of that 100k DROP to 90k!

Worst yet is the figure itself does not change, only the purchasing power! So while 10k is disappearing in front of him his savings account still says 100k.

So, as his savings is being destroyed to print up more money for the well-connected, the newly created money that's being stolen from him through the loss in his purchasing power is now DIRECTLY CONTRIBUTING TO HIM LOSING 10CENTS ON MILK FOR 3 MONTHS, 7 CENTS FOR 3 MONTHS, AND 4 CENTS FOR ANOTHER 3 MONTHS!

He's getting double $#@!ed! The entire middle class and all small-business are owners are getting $#@!ed with him in the same way!

But wait... it gets worse... the companies who are more well connected, and aware of this new money quicker, are able to readjust pricing before anyone else is so they don't take as much of a hit- thus the giants push out the small business man and all consumer resources are diverted to the already strong and well connected companies.


BUT WAIT, IT GETS WORSE...

The example I just provided was about as simple as I could possibly conjure but the more detailed it becomes the worst it is for the middle and lower classes.
Let's say instead of milk the well connected are instead buying property...

They go in and buy a plot of land for 100k that should actually be worth 110k! They make 10k without the seller even realizing it. Let's say that property is being sold by a middle class man and it represents 50% of his net worth. Well... he just lost 5% of his net worth without realizing it and the already rich and well-connceted buyer just stole that 5% from him.

In 9 months when the property is worth 110k the rich man sells it for that and keeps the 10k. He just stole that 10k because the middle class man was unable to recognize the loss in purchasing power.

Essientially no matter what product the well connected are getting they get it 10% cheaper than they should be.

Everyone below them is not getting anything at 10% cheaper, the higher up they are the cheaper they get it but they still aren't getting it as cheaply as the well-connected did from the start at 10%.

So the well-connected are ABLE TO BUY MORE BEFORE THE MARKET READJUSTS FOR THE LOSS IN PURCHASING POWER WITH LESS MONEY.

^That's why Ron Paul calls it a wealth transfer, because the well connected are getting everything cheaper than they should be and they are almost always buying stuff from people who are unable to recognize the loss in purchasing power that's occurring.

As more money is created that means the well connected get even more things cheaper than they should and the more we print, and the more often we print it, the more devastating and more often this wealth transfer continues to happen. So as time continues to go on the gap between rich and poor continues to get larger and larger and larger- until of course the poor are totally desperate and dependent on the government to help them...

AND if the government isn't helping them then the people will DEMAND that they do, they'll cry for socialism and MORE stimulus without realizing exactly what it's doing to them and the politicians, opinion makers, and well-connected will be all the more happy to act as saviors because deep down they know they're robbing these people blind, and the result of that robbery will be the masses coming back to ask to be robbed over and over and over again.

No matter the "stability" of such a system... the people at the top just want to get what they can while they can because when the collapse ultimately does come (either through a monetary crash or civil uprising) they've already got the most $#@! and the most influence. They'll be able to ride out the chaos while the rest of us are left with nothing.

This is how the fed destroys the middle and lower classes.

If the money was sound and couldn't be manipulated like that the purchasing power in our savings accounts wouldn't disappear without us knowing and businesses would be better equipped to set the proper prices. More importantly the well-connected wouldn't get to spend it first and rob us blind over and over again when we come crying to them for more money.

It should be no surprise that these people want no change... this is perhaps the most ingenious system of theft ever created in the history of the world.

[Weston White]

The more that each Dollar is devalued, the further that the middle-class is hedged straight into poverty. The more that the Dollar is monetized, the lower the national financial rates are set, which consequently makes the middle-classes attempts at saving entirely moot, e.g., what point is there in trying to save a few thousands Dollars at ~1-4% APR, especially in consideration of the ominous fact that the Dollar is loosing value at ~5-8% per annum? Furthermore, as was prior stated in an earlier post in this thread, this entire process capitulates individuals to begrudgingly join the scheming credit card treadmill.

The wealthy are setup to avoid most all instances of this lose/lose process, they can invest into: foreign accounts and currencies; privileged high-yielding/long-term business or private accounts; privately loan to others at interest; convert their cash/reserves into hard assets such as metals, business ventures, real estate, art, etc.; play the markets from tight to loose; engage asset flipping/profit turning; largely avoid taxes or otherwise decrease their tax liabilities; etc. As well, the wealthy further benefit from such economic downturns, as they can entirely afford to vulture, poach, and buyout the resulting misfortune of others; in effect they can cheaply clear out their competition merely by monopolizing the (entirely manufactured) situation.