Everything you think you know about economics is WRONG!

[Jan van Eck + 7,558]

5 minutes ago, DayTrader said:

That seems a non sequitur ... 

That's OK.  I'm an Old Guy, so I am entitled.  No young stewardesses for me, so Non Sequiturs it shall be. Huzza. 

Edited December 12, 2019 by Jan van Eck

[canadas canadas + 136]

18 hours ago, Ward Smith said:

You're missing it. The government doesn't print the money, only banks "get" to do that. You have been hypnotized into believing the government "controls" the Central Banks. Nothing could be further from the truth. The Central Banks control the government. 

I though that it was the U.S. government Bureau of Engraving and Printing (BEP) that printed U.S. money.

[canadas canadas + 136]

On 12/11/2019 at 1:18 PM, specinho said:

 

 

I have been wondering how the currency exchange rates were determined since I dreamt of being a One-Day-Millionaire by trying to convert 100 bucks of a nation to a currency that gives a rate of 1: 10 000 many years ago.........

Are they comparing

1. products quality and volume sold??

2. asset /  liabilities of country A : asset /  liabilities of country B??

3. profit or loss of country A : profit or loss of country B??

4. miscellaneous e.g. interest rates and purchase capability??

 

And there was a concept mentioned in a course "macroeconomics for a sustainable planet"..... here's the quote:" Purchasing power parity and interest rate arbitrage. It all starts with the law of one price. What does the law of one price states? Well it states that a good must cost the same everywhere when it is expressed in a common currency.…………Expressing it in Chilean pesos, 2450 Chilean pesos in Chile and 3431 pesos in the US. The Big Mac was more expensive in the US. In reality, the law of one price is an interesting concept, but it is met rarely due to the existence of transport costs, trade barriers, governmental regulations, and non-tradable inputs.”

Here's my reflective point to be considered:"The minimum wage in Chile is USD 400 (the minimum wage in the USA is ~ USD1000). By equalizing Big Mac with one price across the countries is probably not a good idea because the production price and costs of operation in Chile are certainly cheaper than in the USA. A big Mac of USD 5 over USD 400 earning in Chile could be considered expensive and probably an inflation. Hence by putting the exchange rate aside….. Chile can afford to offer Big Mac at the price of may be at 2 USD (in USD 400 earning) or 2 pesos local money (in 400 pesos earning) and the USA USD 5 (in 1000USD earning). The ratio is 5/1000 or 2/400 = 0.005 across the countries. Unless the Big Mac is imported from the USA, the price should be locally calibrated??"

I noticed this because the potato chips that I used to purchase at 80 cents per package is costing 6 bucks of local currency and of local source of origin but of the same quantity or size ........... the above concept was realized might have been the major contributing reason................ Are we doing this right?? 

What about arbitrage then where some differences can exist in different places for the same thing?

[Ward Smith + 6,615]

1 hour ago, canadas canadas said:

I though that it was the U.S. government Bureau of Engraving and Printing (BEP) that printed U.S. money.

If you look at any American bill, it says "Federal Reserve Note" right there at the top. I'm pretty sure they've figured out a way to have the US government print the money for them, and charge them for the privilege. 

Also you might be surprised to know less than 3% of all the cash money (that all says "Federal Reserve Note" on it) is in circulation and less than 23% of that is physically in the United States. 

[Ward Smith + 6,615]

No one is paying attention to the Repo market.

Do I get to say I told you so later? 

Edited December 12, 2019 by Ward Smith
Added pretty picture

[Ward Smith + 6,615]

On 12/11/2019 at 5:20 PM, Jan van Eck said:

To be entirely accurate, the Central Bankers that make up the Directors of the Central Banks control both the money supply and the discount rate, which in turn sets interest rates for just about all negotiable instruments.  This has a dramatic effect on the ability to issue debt instruments and securities.  The Governments themselves still control matters of social policy, e.g. whether or not your health plan will pay for your daughter's birth control pills, that sort of thing. Governments also control other aspects of social behavior, such as if a white person can marry a black person  (so-called "anti-miscegenation laws"),  arbitrary detention in Guantanamo, that sort of thing.  Central Bankers do not control everything (at least, not quite yet). 

Actually they do, and have for some time. The "social engineering" is merely a distraction. 

Quote

Nathan Rothschild, who controlled the Bank of England after 1820, notoriously declared: I care not what puppet is placed upon the throne of England to rule the Empire on which the sun never sets.   The man who controls Britain’s money supply controls the British Empire, and I control the British money supply.

 

[specinho + 470]

22 hours ago, canadas canadas said:

What about arbitrage then where some differences can exist in different places for the same thing?

This goes back to the aim of doing so.............  For example, if one price for all intends to reduce imbalance in sales among countries due to disparity in exchange rates, then, this act might have turned the same item a luxury in one country and common good in another. 

Shall we allow the basic calculation to be taught to the basic management staff, it could appear easy to adjust to this concept that "the cost of production + % profit intended = selling price" and allow disparities wherever may be.............. I was denied a free flow of tap water to a group of 350++ youth customers doing active activities (who had paid ten of thousands entrance fees + combo meals and drinks) at the cost of 0.0003 cent per person per litre; additional egg and rice of 35 cents, when the base profit for set meal was calculated at more than 250% after giving the extras. The management did not approve it. They insisted the customers to buy the bottled mineral water, can drinks sold and extra purchase of meal instead.......  Basic calculation allows us the flexibility to adjust whatever the condition is and whichever country it could be. 

p/s: nooo........... please do not tell me the person who suggested "one price for all" was owing to the lack of motivation to do complicated maths..........

 

 

Edited December 13, 2019 by specinho

[Ward Smith + 6,615]

On 12/13/2019 at 9:32 AM, specinho said:

This goes back to the aim of doing so.............  For example, if one price for all intends to reduce imbalance in sales among countries due to disparity in exchange rates, then, this act might have turned the same item a luxury in one country and common good in another. 

Shall we allow the basic calculation to be taught to the basic management staff, it could appear easy to adjust to this concept that "the cost of production + % profit intended = selling price" and allow disparities wherever may be.............. I was denied a free flow of tap water to a group of 350++ youth customers doing active activities (who had paid ten of thousands entrance fees + combo meals and drinks) at the cost of 0.0003 cent per person per litre; additional egg and rice of 35 cents, when the base profit for set meal was calculated at more than 250% after giving the extras. The management did not approve it. They insisted the customers to buy the bottled mineral water, can drinks sold and extra purchase of meal instead.......  Basic calculation allows us the flexibility to adjust whatever the condition is and whichever country it could be. 

p/s: nooo........... please do not tell me the person who suggested "one price for all" was owing to the lack of motivation to do complicated maths..........

Your cartoon shows 3 people stealing admittance to a sporting event. Ironic much?