Fixed it for ya...

Originally Posted by
Cesiumsponge
Ron Paul calls it the sinister "inflation tax" because everything you own is devalued because it's all based on the US dollar. The government printing trillions of dollars to pay for its own bills is much easier than paying it with trillions of dollars of goods extracted from productive taxpayers.
Governments create no wealth. Government sells assets previously seized, taxes, borrows, or "prints" money to pay its ever-increasing bills for war and welfare. "Printing" means that bonds which cannot be sold are "monetized" by the central bank, i.e. that bank "buys" them with a check made good by crediting money (magic) to their own checking account.
If you or I did this, it would be counterfeiting, fraud or both.
Think of an auction (free market) for ammo. Then imagine one bidder (.gov) can manufacture its own money and bid; other bidders must work, be taxed and save for their bids. Who will get the ammo? Will the money the other bidders slaved and saved for be worth more or less than at the beginning of the auction?
Now, ATK has contracts to produce ammo for the .mil and is paid with the "printed" money. [Note: We may get access some of the sweepings off the floor.] ATK uses the money to bid up the price for components which all ammo manufacturers must buy. The federales of .gov also get some of the printed money and compete for ammo produced outside of Lake City, bidding up component prices and bidding up the actual cost of ammo as well. Homeland Security grants (more of the "printed" money) get used by local.gov to enter the ammo market, as well as local tax money.
The supply of ammo is pretty inelastic (fixed); the demand for the ammo due to available money is elastic (and, in this case, increasing due to more .gov money and more slaving and saving AR owners). The law of supply and demand (which congress cannot repeal, despite its best efforts) dictates both component and ammo prices rise.
rhino- About all I can say regarding the euro is this: If folks perceive that the euro is being inflated less rapidly than the dollar and it is a better store of wealth, it is therefore prudent for them to buy and sell in euros. Then sellers will sell things like copper, lead and zinc for euros instead of dollars. Dollar holders must then add more dollars to the bid to make the purchase.
Last edited by Submariner; 05-16-07 at 17:36.
Reason: bad grammar
"The very purpose of a Bill of Rights was to withdraw certain subjects from the vicissitudes of political controversy, to place them beyond the reach of majorities and officials and to establish them as legal principles to be applied by the courts." Justice Robert Jackson, WV St. Board of Education v. Barnette, 319 U.S. 624 (1943)
"I don’t care how many pull ups and sit ups you can do. I care that you can move yourself across the ground with a fighting load and engage the enemy." Max Velocity
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