Seems like this forum is getting more political and economical rather than religious and spiritual.

Whatever, Gary.

All I'm saying is that this forum appears to be turning into a platform for certain people's personal political agendas.

Perhaps I frequent the wrong forum...

In one of your posts to me you claimed that "managed capitalism" is done successfully all over the world. I want you to point out the examples of what you consider to be economies that are successfully managed by government.

I'm curious why you titled this, "ping kland". I know nothing of what you mean by "managed capitalism" nor of any reference I would have made to such. Any time economies are "managed" by the government, problems happen. Sounds more like socialism than anything to do with capitalism.

Whatever, Gary.

All I'm saying is that this forum appears to be turning into a platform for certain people's personal political agendas.

Perhaps I frequent the wrong forum...

I think it was someone other than Kland who brought up "managed capitalism".
See this post where it was discussed previously.
.

Sorry about that, kland. My memory failed me. I thought it was you had had said to me that "managed capitalism" was a success throughout the world.

And where did anybody say "managed capitalism worked throughout the world"?

It has worked in a number of instances, namely China at this time as James Peterson has pointed out.

There has never been an instance where Hayek's ideals were as successful. So, what do you say Gary K?

You really think China is a good example? If it is then a per capita income of less than $8000/yr is being really prosperous, as that is what it was in 2015. During the same time frame the US per capita income was almost $56,000/yr.

For documentation of this go to here: http://www.maritime-sda-online.com/forum...4072#Post184072 .

That $8,000.00 a year is a huge increase from what it was 30 years ago! We know they have almost a billion people to help, but, they are the fastest growing economy in the world and have been for many years!

With all these decades to consider, you only look at this one snapshot in time? Petty.

kland,

The reason for governments not following the principles of Austrian economics is simple to understand. Politicians get into politics to have power. If the principles of Austrian economics were followed it would greatly reduce the amount of power politicians have, and it would stop them from buying votes using other people's money.

Have you never seen the following quote? The American Republic will endure until the day Congress discovers that it can bribe the public with the public's money.

That quote is exactly what is going on in the US, and other socialized nations. It is politicians building their power upon the base of buying votes with other people's money. You cannot have that if the principles of the school of Austrian economics is followed.

We can never have that regardless of what economic principles we use! That is always deceitful and abusive for any government to practice.

So then, speaking of Austrian ideals; What do we do with all the currencies that would probably develop throughout the nation? Can any of us create and sell our own currency?

Are you telling me that you have never listened to a politician promise voters what he is going to "do" for them? How they are going to give "free" education, "free" healthcare, how they are going to subsidize housing, the cost of energy, etc...? None of those things can ever be free. Someone always pays for them. And who pays for them? The taxpayer. Socialism is one big con game.

Do you know that during the greatest period of growth in an economy the world has ever seen, the colonial days of the US until the end of the 19th century, most banks were private institutions and many had their own money? The free market set the price of one bank's money against another bank's money. That was based upon the financial stability of each bank.

There wasn't even a central US bank: no Federal Reserve. It was the creation of that by the US Senate which deliberately gave itself no oversight over the Federal Reserve, that has been the cause of most of the economic issues the US has faced sine then. It is the fractional reserve policy guarantees inflation. It is the willy nilly printing of money and the playing with interest rates that in the long term guarantees financial instability and allows the incredible amount of financial fraud to take place. It is the Federal Reserve that runs up market prices and then creates crashes by selling off their over-priced assets, thus transferring incredible amounts of wealth away from private citizens.

For documentation of this watch the interview at the following link of a financial expert in the markets. http://usawatchdog.com/market-crash-and-civil-war-possible-gregory-mannarino/

Gregory Mannarino is not the only person saying these things. Many of the US's top independent financial experts are saying the same thing. Mannarino comes across as incredibly arrogant but at the same time he really understands the markets.

Here is another really good link on what is going on. http://usawatchdog.com/bitcoin-gold-form-two-front-war-with-central-banks-andy-hoffman/

You will hear about a PPT, or Plunge Protection Team, created by the government. It is another manipulator of the markets. Oh, the government tells us that it is really for our protection, but in effect what it does is stop massive selloffs and attempt to lock in that wealth transfer away from private citizens. They lock the barn door after the horse has bolted.

We had two central banks in the 1800's before the Federal Reserve; The First Bank of the United States and The Second Bank of the United States. Both ended when the Congress refused to renew there charters at there 20 year renewal point.

I do need to clear up one thing here. When I said the US had a lassez faire economy and didn't interfere with business was that the government wasn't into business regulation as it was after the 1890's and onward. That the US government tried to manipulate the currency and spectacularly failed every time it did so is to me a separate issue, even if that currency manipulation affected the business climate every time they have tried it. Sorry for the miscommunication.

There were still two central banks covering 40 years of US history.

I never said they function exactly like the Federal Reserve, nor did they need to. They did exist and were politicized and did many other things central banks do. Although, the first one was fairly successful.

You can't accept the fact that Austrian economics have never been completely adopted and that they really can't serve a nation well over time.

Managed capitalism is the only form of economy that has maintained any real distance in time. Even it will collapse eventually, but, we can learn to reduce those effects.

There were still two central banks covering 40 years of US history.

I never said they function exactly like the Federal Reserve, nor did they need to. They did exist and were politicized and did many other things central banks do. Although, the first one was fairly successful.

You can't accept the fact that Austrian economics have never been completely adopted and that they really can't serve a nation well over time.

Managed capitalism is the only form of economy that has maintained any real distance in time. Even it will collapse eventually, but, we can learn to reduce those effects.

That the purpose of establishing the Second Bank of the United States was to support the state banks in their inflationary course rather than crack down on them is seen by the shameful deal that the Second Bank made with the state banks as soon as it opened its doors in January 1817. At the same time that it was establishing the new bank in April 1816, Congress passed a resolution of Daniel Webster, at that time a Federalist champion of hard money, requiring that after February 20, 1817, the United States should accept as payments for debts or taxes only specie, Treasury notes, Bank of the United States notes, or state bank notes redeemable in specie on demand. In short, no irredeemable state bank notes would be accepted after that date. Instead of using the opportunity to compel the banks to redeem, however, the Second Bank of the United States, in a meeting with representatives from the leading urban banks, excluding Boston, agreed to issue $6 million worth of credit in New York, Philadelphia, Baltimore, and Virginia before insisting on specie payments from debts due to it from the state banks. In return for that agreed-upon massive inflation, the state banks graciously consented to resume specie payments.55 Moreover, the Second Bank and the state banks agreed to mutually support each other in any emergency, which of course meant in practice that the far stronger Bank of the United States was committed to the propping up of the weaker state banks.

The Second Bank of the United States was pushed through Congress by the Madison administration and particularly by Secretary of the Treasury Alexander J. Dallas, whose appointment was lobbied for, for that purpose. Dallas, a wealthy Philadelphia lawyer, was a close friend, counsel, and financial associate of Philadelphia merchant and banker Stephen Girard, reputedly one of the two wealthiest men in the country. Toward the end of its term, Girard was the largest stockholder of the First Bank of the United States, and during the War of 1812 Girard became a very heavy investor in the war debt of the federal government. Both as a prospective large stockholder and as a way to unload his public debt, Girard began to agitate for a new Bank of the United States. Dallas’s appointment as secretary of Treasury in 1814 was successfully engineered by Dallas and his close friend, wealthy New York merchant and fur trader John Jacob Astor, also a heavy investor in the war debt. When the Second Bank of the United States was established, Stephen Girard purchased the $3 million of the $28 million that remained unsubscribed, and he
and Dallas managed to secure for the post of president of the new bank their good friend William Jones, former Philadelphia merchant.56

Much of the opposition to the founding of the Bank of the United States seems keenly prophetic. Thus, Senator William H. Wells, Federalist from Delaware, in arguing against the bank bill, said that it was ostensibly for the purpose of correcting the diseased state of our paper currency by restraining and curtailing the overissue of bank paper, and yet it came prepared to inflict upon us the same evil, being itself nothing more than simply a paper-making machine.57

In fact, the result of the deal with the state banks was that their resumption of specie payments after 1817 was more nominal than real, thereby setting the stage for the widespread suspensions of the 1819—21 depression. As Bray Hammond writes:

[S]pecie payments were resumed, with substantial shortcomings. Apparently the situation was better than it had been, and a pretense was maintained of its being better than it was. But redemption was not certain and universal; there was still a premium on specie and still a discount on bank notes, with considerable variation in both from place to place. Three years later, February 1820, Secretary [of the Treasury] Crawford reported to Congress that during the greater part of the time that had elapsed since the resumption of specie payments, the convertibility of bank notes into specie had been nominal rather than real in the largest portion of the Union.58

One problem is that the Bank of the United States lacked the courage to insist on payment of its notes from the state banks. As a result, state banks had large balances piled up against them at the Bank of the United States, totaling over $2.4 million during 1817 and 1818, remaining on the books as virtual interest-free loans. As Catterall points out, ”so many influential people were interested in the [state banks] as stockholders that it was not advisable to give offense by demanding payment in specie, and borrowers were anxious to keep the banks in the humor to lend.” When the Bank of the United States did try to collect on state bank notes in specie, bank President Jones reported, ”the banks, our debtors, plead inability, require unreasonable indulgence, or treat our reiterated claims and expostulations with settled indifference.”59

From its inception, the Second Bank launched a spectacular inflation of money and credit. Lax about insisting on the required payment of its capital in specie, the bank failed to raise the $7 million legally supposed to have been subscribed in specie; instead, during 1817 and 1818, its specie held never rose above $2.5 million. At the peak of its initial expansion, in July 1818, the Bank of the United States’s specie totaled $2.36 million, and its aggregate notes and deposits totaled $21.8 million. Thus, in a scant year and a half of operation, the Second Bank of the United States had added a net of $19.2 million to the nation’s money supply, for a pyramid ratio of 9.24, or a reserve ratio of 0.11.

Outright fraud abounded at the Second Bank of the United States, especially at the Philadelphia and Baltimore branches, particularly the latter. It is no accident that three-fifths of all of the bank’s loans were made at these two branches.60 Also, the bank’s attempt to provide a uniform currency throughout the nation foundered on the fact that the western and southern branches could inflate credit and bank notes and that the inflated notes would wend their way to the more conservative branches in New York and Boston, which would be obligated to redeem the inflated notes at par. In this way, the conservative branches were stripped of specie while the western branches could continue to inflate unchecked.61

The expansionary operations of the Second Bank of the United States, coupled with its laxity toward insisting on specie payment by the state banks, impelled a further inflationary expansion of state banks on top of the spectacular enlargement of the central bank. Thus, the number of incorporated state banks rose from 232 in 1816 to 338 in 1818. Kentucky alone chartered 40 new banks in the 1817—18 legislative session. The estimated total money supply in the nation rose from $67.3 million in 1816 to $94.7 million in 1818, a rise of 40.7 percent in two years. Most of this increase was supplied by the Bank of the United States.62

The huge expansion of money and credit impelled a full-scale inflationary boom throughout the country. Import prices had fallen in 1815, with the renewal of foreign trade after the war, but domestic prices were another story. Thus, the index of export staples in Charleston rose from 102 in 1815 to 160 in 1818; the prices of Louisiana staples at New Orleans rose from 178 to 224 in the same period. Other parts of the economy boomed; exports rose from $81 million in 1815 to a peak of $116 million in 1818. Prices rose greatly in real estate, land, farm improvement projects, and slaves, much of it fueled by the use of bank credit for speculation in urban and rural real estate. There was a boom in turnpike construction, furthered by vast federal expenditures on turnpikes. Freight rates rose on steamboats, and shipbuilding shared in the general prosperity. Also, general boom conditions expanded stock trading so rapidly that traders, who had been buying and selling stocks on the curbs on Wall Street for nearly a century, found it necessary to open the first indoor stock exchange in the country, the New York Stock Exchange, in March 1817. Also, investment banking began in the United States during this boom period.63

Starting in July 1818, the government and the Second Bank began to see what dire straits they were in; the enormous inflation of money and credit, aggravated by the massive fraud, had put the Bank of the United States in real danger of going under and illegally failing to sustain specie payments. Over the next year, the bank began a series of heroic contractions, forced curtailment of loans, contractions of credit in the south and west, refusal to provide uniform national currency by redeeming its shaky branch notes at par, and seriously enforcing the requirement that its debtor banks redeem in specie. In addition, it purchased millions of dollars of specie from abroad. These heroic actions, along with the ouster of bank President William Jones, managed to save the Bank of the United States, but the massive contraction of money and credit swiftly brought the United State its first widespread economic and financial depression. The first nationwide ”boom-bust” cycle had arrived in the United States, impelled by rapid and massive inflation, quickly succeeded by contraction of money and credit. Banks failed, and private banks curtailed their credits and liabilities and suspended specie payments in most parts of the country.

And what is the evidence that the bank was successful? I see no proof of your allegation whatsoever. Nothing. Nada. Zip. Zero.

The only thing the second bank ever accomplished was to create a boom and bust cycle. That is all it accomplished and I can give you the evidence.

What is referred to in the following as "specie" is hard actual currency such as silver and gold, not fiat currency such as paper money.

The following quote is from the book, A History of Money and Banking in the United States. I do not have the correct pagination as it comes from an ebook, but it is under the heading "The Second Bank of The United States 1816-1833" found in Part 1 of the book.



That, alchemy, is what you call a "success".

And again, you lie and put words in my mouth. You haven't proven anything because there isn't any evidence your ideas or those of Hayek can ever work!

You're just a whiner. You're wrong and refuse to admit it. But, managed capitalism is still the best economy.

LOL. I just showed in my previous post what a failure the ideas you hold are. Your "managed capitalism" created the first depression to ever occur in the US. That to you is successful. Otherwise you would not have said the Second Bank was "fairly successful". "Fairly successful" to you is a depression following a few years of inflation. Boom-and-bust, which you attribute to the free market, came directly from the government following the ideas you have been espousing.