The premise is faulty, and all the witchdoctors promoting 'natural and good 3% inflation' are quacks. Its a simple mental exercise to see that DEFLATION should be the norm. True growth in productivity means that the cost of production is dropping. Dropping costs equal dropping prices. With increased automation, we should see steady decreases in employment and costs, moving towards a future gift economy. Fact.
Poster needs to correct a major point, the Obama Administration removed food and fuel prices from the reported CPI. These are the two largest drivers of the cost of living. During the Obama Administration fuel prices have increased between 150% and 200%. Food prices are a bit tricky. The price for a box may remain the same but the amount contained in the box decreases. Say the medium sized box of cereal costs $4. It used to contain 18 ounces but now contain 14 ounces.
@Robbob9933 this is an important point but a point that is not necessary for the video. The video is simply to explain the concept of of inflation for those who do not understand it. Bringing in the element of what makes up the CPI (and the politics behind it) adds a level of complication and subjectivity that would take away from the core purpose of the video (i.e. explain the concept of inflation in a simple way that is easy to understand).
@1601tgc When the two item that impact the cost of life are removed from the CPI, it gives a false picture as the health and stability of the economy. If people really understood that inflation is roughly 10 times what is being reported, they would through a fit and would demand spending be reigned in. Causing people to be blissfully ignorant is pure evil.
so the bottom line is greed causes inflation. It is not because the dollar has lost value it is because people want to over consume. this falls inline with the fact the dollar had gained 450% in value over the last 60 years and remains strong.
Hmmm.. I feel like this would work out okay in the end were it not for the fact that such a huge portion of that $10 t (which has actually been found to be around $16 t) were going to pay for treasury securities, since this is what the banks are doing with the money they've been lent by the Fed. This is forming a "government bubble" and there's no way to get rid of that debt without either high taxes or inflation combined with austerity measures. Wonder how this will work out in a few years...
What the bankers have done is established "their" private banks in the industrialized nations so that when the governments need money, the private banks are the only place to get it. Therefore, the gov. is dependent on the bank for its cash flow which all of it is borrowed making the national debt skyrocket, and then it's placed on the backs of the people.
Except now let's talk about reality. The Consumer Price Index is a fraud so Bill doesn't get any raises, prices keep rising, banks get 0% interest from the Fed and turn around and charge Bill 14% for a car loan & $30% on his credit card because they keep changing the due date so they hope he will turn it in late one month so they can jack his rates and the banks get rich, Bill gets poorer & the top 2% get 90% of all the wealth since Bush took office back in 2000.
Food & Fuel is not included in the CPI so that they can make it look like there is less inflation. They use Hedonics to substitute less expensive items that do the same thing to also fraudulently lower the index.
Forgive me if this is a really dumb question but I have not been able to figure this out.Does the federal reserve just print money and then give it to the private banks for free so they can lend it out and make money off of it ? I don't understand how this system works.
The Fed's interest rates are 0 so the banks do get it for free. The Fed eases the money into the system so the banks will lend to people so the economy picks up again. Once the economy is up again the Fed can then raise interest rates and collect money back in.
Respond to this video... If they really wanted to pump more money into the system, why couldn't the Fed just give low or no interest loans directly to the public ?
Because the public will spend it and drive up the cost of goods and start another bubble. If banks hand out the loans then they can check to see who qualifies for them and can "ease" money and loans onto the public. Watch the Quantitative Easing video to learn more about it.
@ryan84160 since we are in a money debt system, the debt has to be created somewhere to increase money supply and it is best to put that money directly into the hands of the people instead of into the banks who refuse to loan it out.
@ryan84160 Yes, you have it. Add to it that the federal reserve is private, so it's just private bankers who own it. It's akin to me drawing a dollar bill, loaning it to you, you spend it, and pay me back my dollar plus interest. The bank in the middle is just part of the Fed Reserve System, but yes, they profit off of it as well. But the big problem is we owe a debt for every dollar created by the private Fed, and since they only print principle, never the interest, we'll never pay it off.
@mikejadoti This just seems like insanity to me. I mean how did this system get set up in the first place ? It is obviously rigged in favour of wealthy bankers and no one had a problem with this?
Hold on bro. You said it yourself that the banks were using the QE money to buy government bonds. The government does spend it. Government employees and subcontractors spend it and through the deficit it goes over sees to China. The US is exporting their inflation.
The Elite are the ones with mass cash, bacause we are not. Middleclass has been paid the same avg or less, but all the prices are going up. Food, gas, clothes, car taxes, electronics is the thing I will say going down. That means reality is worst than our video.
A biggest public campaign has started to end fractional reserve banking, look at the POSITIVE MONEY website and support the campaign ...and spread the word.
In the UK now we are seeing the effects of inflation. However with the government making huge government spending cuts and soon higher interest rates, we are just going from one extreme to another. The truth is with huge unemployment people wont be able to go out and buy the "lucky charms". So if the banks aren't lending and still they are making a loss, where is the money? iit is probably getting under run by the chinese
great videos though, learnt alot for a level economics
Some assets were overinflated (Bubbles) and these are correcting downward --houses for example--while most other items we use every day---food, gas, health insurance, health care--are rapidly rising to the turn of 10-20% per year.
Some call this Biflation.
This is harmful and destroys savers and retirees while favoring debtors like banks and people who spent too much during the last decade instead of being frugal. Savers are sacrificed to the benefit of debtors and spenders.GL!
simple, whe nthe economy recovers and banks start lending out again the fed should enact contractionary policy, (selling treasuries) in effect "destroying" money and keeping inflation low. However, because it is difficult to determine exactly when the economy has "recovered" the fed will probably keep expansionary policy going to long and there will probably be mild inflation, Between 4-5%
@durhamdf 1. if inlflation is allowed to exist, doesn't that in effect destroy the value of money rather deliberately. 2. if the cost of living and raises are outstripped by the overall rise of and on available money isn't that a true sign of a failing economy. 3. is the federal reserve regulated in any way by the government? I truely dont know and haven't been able find any credible info. Isn't federal lending just really complicated gambling?
@godspawn007 Inflation does destroy the value of money, but at the natural rate of inflation, it is keeping up perfectly with the growth in output and wages will keep up. Inflation beyond the natural rate is what we actually experience, which we are not at yet, and actually does benefit the lower/middle class debtors against the big creditors. The Fed is "independent" but the president and congress can replace the board of governors on staggered terms, because of this the Fed is politicized
@durhamdf a separate issue I see is that this country as a whole loves to push its overall wealth or lack thereof down the road to future generations. We love to operate on credit lines rather than do the responsible thing and not purchase things we actually cant afford. What happens when those credit lines dry up or pull too thin? We're seeing this right now, yes? Do we as a nation need to think better about money in general? What about the abundance of lawyers, beaurocrats, BAD yes or no?
I don't agree with your premise. Inflation is not natural at all. It is caused by money creation by central banks in cahoots with gov'ts. Rising prices are a symptom of inflation, not the definition. It does not affect all sectors of the economy uniformly. Without currency debasement, a more natural state would likely be declining prices overall as productivity rises.
of the world either. Our differences would be how we would deal with the issue. Where you would try to hurt the large businesses, I would aid smaller businesses rather than taxing them to closure. I hope you realize that you contradicted yourself a little bit. If you are "pro small business," then you must also be fine with paying higher prices. Small businesses are known for making better products, for a larger price. Large corporations are the reason why even the low class American's can
I'm not trying to hurt them. It's the Overall good. When you're wrong and it's bad, it shouldn't be. It's that simple. "Small Businesses" and Corporations are different. When small businesses fail because they are overcharging, it doesn't cause a collapse in the system. I don't know how Corporate America works. You can contact Subway and ask if you can run one of their Chains. I don't know who is doing that here where I live.
@heartlessvietboy Yes, you did say you would try to hurt them. By taxing them 50%!!! Are you mad? Should success come with such a downfall? Why do you believe in limitations on success? Do explain. And yes, what I previously said IS hard work. A billion dollar corporation doesn't spawn out of a poor immigrant's ass. Hard work, VERY hard work, and dedication are the recipe for such. Like I said before, if the people are against large corporations, then WHY ARE THEY SUPPORTING THEM?
@EJWProduction It seems to me that you are in the wrong place, there are several places in the world where someone like you could be happy with big government regulating every thing you do. Perhaps instead of trying to drag down the richest, most powerful country in the world (and there is a reason for that), you should simply go somewhere that suits you better.
Government is not regulating everything you do. It's called Taxing the Wealthy because they are damaging the economy. The reason why you are making money is because your government created the currency. You're approaching your thinking from an evil Government perspective bashing on Government "Total" control for some reason. Evil Government is the reason why 1/2 of human population nearly went extinct you idiot!!
@heartlessvietboy No, you're an idiot and you're a thief. There is nothing worse than someone who keeps making the same mistakes over and over again, never learning from history.
How can I be a Thief. I'm the reason why you have money in your pockets. Are you going to make all the steel and own all the gold? Are you not going to share with your fellow human beings? Are you going to let us starve? Aren't we going to farm ourselves? Aren't we going to take your gold and steel?
@heartlessvietboy You call it forced donations, I call it theft. You are most definitely NOT the reason I have money in my pockets, beside, I'd much rather have gold, or anything other than worthless paper in my pockets anyway. No, why would I share with people when I work hard for what I have, I feel that everyone should do for themselves and mind their own; however, some charity would be necessary and would be given to those in need. I hate parasites, the people who feed off of others, because
Mine all the Gold you want. People will want to trade their potatoes and tomatoes with you. They would die for something that is useless. Id rather get lumber to build a house and food to eat. Food is to eat not to trade. Grow your own food and eat.
@heartlessvietboy because they lack the motive to provide for themselves. Charity is completely fine with me and I happen to be very charitable. Hell, I bet I donate much more money than you do on the monthly basis. I do not believe people should be forced to donate via taxation or by any other means.
Eliminate Government. Nobody asked for TV's and DVD players. Nobody asked for McDonald's and Taco Bells. I grow my own food to eat on "my land". Land is for everybody. Nobody asked for anything, we were happy the way it was. A simple life. Until Government came in and started developing and polluting the entire World. I grow my food you grow yours. Leave me alone, I can do whatever I want to do "grow whatever I want to grow". I give when I want to. I am free this way.
Taxing regular everyday citizens and small business owners too much when they are not making enough money isn't ideal. You only need to tax when resources are running low or when certain resources are being wasted too much.
@heartlessvietboy Oh and one more thing. I am by no means a rich person. I am a struggling college student. So don't think I'm an executive of some major corporation arguing for my way of life. I work part-time at one of the biggest banks in America, I see the theft that goes and in that respect, I'm assuming we agree that some (minimal) regulation should be put in place. But never should a bank have to pay ridiculous taxes to support some lazy peoples' lavished lifestyle. And don't think for
You're a struggling college student because you are following a system that's making you struggle. How smart is it for you to argue for freedom and against government taxation when you are willing to be pawn under this system. How do you need to "argue"? Isn't arguing bad? And being an Executive good? You're an executive making millions why do you need to argue for your way of life unless you are doing something that isn't overall good for humanity.
@heartlessvietboy a second that people don't abuse our "government aid" systems. Helping people in need is one thing, but I shouldn't see people on welfare driving in brand new dodge chargers like I do now. I want a charger, perhaps I should just give up on my idea of living and just get the government to buy all my bullshit, in turn letting private businesses buy my bullshit.(being sarcastic here)
Don't get me wrong. I worked hard for my money too. I bought my First Car at the age of 18. A Brand New Mitsubishi 3000GT SL. Then I landed a good job that paid well. However I got laid off but found a new job however paid less. That paying less didn't make me very happy so I went looking for another job. I landed a job that paid me as well as the previous job. There I made my money until I was Laid off again.
My mother kept on telling me to go to school when I had no clue what to do. Maybe we do need guidance. It's like elementary they drop you off and you walk to your classroom. Your class schedule is listed by period and times. You follow your schedule which is quite fun in the summer time laying and reading your school schedule. First day of class, some people knew eachother, some were your former elementary students. Thats Life for yah. Then the bell rings and you go home get ready for work.
You take bull sh** classes going no where. Counselors don't know what you want because you "don't know what you want" unless you are "all prepared in life". That's life for yah. 60% of students don't even do what they went to school for. They don't even really know what they want! Some fail, lay around look for a job paying $7.25/Hr. Does that sound fundamentally as an "Ideal" system?
Meanwhile mother and father is breeding 6-10 children per family. Population growth has reached 7 Billion. The European's nearly wiped themselves out from waging war. Japan ate 2 Hydrogen (Nuclear) Bombs.
We are not stupid. Give us a schedule and we abide by it. How does the school system even keep track of you to send letters to your house and call you to remind you to go to school?? Meeting your teachers before school begins isn't something I recall liking. However Open House sounds interesting. Thats the stuff that went on in my mind as a kid. I grew up in San Francisco California so it could be different elsewhere.
I didn't increase Taxes to hurt them. I increased Taxes because its the right thing to do. Are there limitations on how you behave? Success is a feeling and is that. If we don't limit, are we to take everything? We live and we're the making of our world and our society. There's no such thing as success or pursuing success in other countries. Its just called work and make money. You see, America teaches these things to people about success and knowledge when its not real.
First of all, inflation is expansion of the money supply, while rising prices are symptoms of inflation. But there is a lot of dimensions this video fails to look at, which are the cause for the symptoms of inflation we are experiencing right now, that is the defficit spending by govt. which throws money right into the economy.
You explanation of inflation is incorrect. The company who raise the cereal price do not do it because they see demand increase but because their factors of production increase ie. that they need more resources to create more goods to meet increased demand and so the unit cost increases.
Same in UK:- INFLATION is expected to come down when the job losses hit but what a crazy, crazy way to go on:- slow the economy to tackle inflation when the BANK OF ENGLAND ADMITS IT DOESNT KNOW WHAT THE REAL RATE IS!
Only the FDR Glass-Steagall principle will separate commercial from speculative banking, thus freeing the nation from obligations to Wall St. and the City of London, and re-establishing a credit system for rebuilding the nation.
H.R. 1489, Return to Prudent Banking Act of 2011, is before the House of Representatives, which aims to revive the separation between commercial banking and the securities business, in the manner provided in the Banking Act of 1933, the so called 'Glass-Steagall Act
No matter what people say but the best way to teach is to engage the audience regardless of how they do it...this guy clearly knows how to do this. Great stuff! And really helpful.
This is a joke. Don't you see the moral hazard of this. Why allow the government to steal from savers so Bill can have more salary. It is a joke. This is voodoo economics. We need the end the ability of the government to create money, force banks to close their doors so they can do something productive, and have government employees be fired so they can enter the private sector.
Blamed everyone but the real culprit . The Federal reserve has devalued the dollar 98% there is nothing wrong with that? who cares about prices when our real cost of living is going up while incomes are stagnate ,no job recovery ,no prospects on the horizon after pumping ONE TRILLION SIX HUNDRED BILLION QE 1,2 OF fake fed notes into the phony system of outlaw gamblers. where is all that multiplier action at now lord keynes ? Ron Paul and the Austrians were right for the last 30 years plus...
The concept is that there is a limited number of goods and services to buy. The more money people have to buy limited resources with, the more expensive those resources will get. The idea behind stimulus is that by making stuff more expensive people will start producing more to take advantage of high prices.
The problem is that stimulus usually feeds into distortions and bubbles. The system becomes unstable, then gradually unsustainable. The correction then causes recessions.
The reason for inflation is that businesses are charging too much thus causing a domino effect. People can naturally increase the prices of their products or services because if they don't it will poison them. Maybe because cost of living is expensive from the real estate industry or gasoline. Or resources are scarce = low income. Basically inflation is when prices are high. If you are talking about Government Currency Value or Government sending money out, that is something different.
Er me thinks he's missing a small point here the value of the $ !! it's not just about cost of prduct and how much someone thinks they can get for it!
1. if the bankers get this 10T and into the system, and yet not lending to businesses and individual, why is still getting more T into the system?
2. if the economy recovers, and the 10T got to be taken away from the system (which it has offered little help in the first place), and yet, if not taken away fast enough, it will create problem. So, why in the first place put the 10T into the system? too see if the "taken away" as a spectacular show for the audience??
This is not necessarily all true. The reality is that america is in a period of deflation. Everything is deflating because everything was mostly overvalued. The "fake big number wealth" disintegrated. Instead of a relatively quick correction followed by bankruptcies and a clean up of debt. We have the same unsustainable system running on new money. Maintaining this system becomes a exponentially expensive job. The longer they wait to make corrections, the worse the corrections will be.
Why would stimulus cause inflation? What inflation are you talking about? Shouldn't it help people's income by giving them money to buy products thus prices of those products wont increase because business owners are making money?
@heartlessvietboy Hah, let's just give everyone a million dollars. Then they can quit their jobs at, for the sake of example, Mrs. Sue's Diner, leaving Ol' Ms. Sue fucked. But, Ms. Sue can stay in business if she pays emplyees 100 grand a year. Who's pass that up, even if you had a mil? I know I wouldn't. But how in the hell is Ms. Sue suppose to afford all that? By raising the price of her hamburgers from $5.00 (lunch special, comes with fries) to $105. Million isnt so great anymore eh?
Inflation is because of Greed and Wall Street. They want to make $1 Billion/year. The everyday human just wants to make 100K a year. They can barely make 40K a year!
@heartlessvietboy You speak of greed as if it's a bad thing. First of all, I don't see why you socialists like getting involved in everyone's personal interests so much, but since you are, don't you understand that it's greed that developed the modern world? Let's talk about modern medicine,the same medicine and medical procedures that give people life and well being, hundreds of thousands on the daily basis. You really think people go to medical school for the sake of helping people?
@heartlessvietboy While that would be nice, let's stick to reality shall we. Besides, free people are the most charitable people in the world. I realize that Wall Street, big banks and corporate giants dosome pretty messed up things, everything has a downside and those situations can be fixed without much government regulation or control anyway. To get back on topic, inflation is the result of government dumping money into the system, borrowing money from "the future buying potential of America"
Third world countries are free, I don't see them giving to Charity. Reality is inflation is caused by Corporate greed. When you are burdened trying to pay rent, you increase the price of your products. When gasoline is emptying your pockets every month, when you feel a $500 registration fee is too much, you increase the price of your products to balance out that loss. But guess what, 80% of Americans don't own businesses so how can they increase the price of a product they don't own?
When Gasoline prices are high, meaning $3.50 x 1 Million Gals. you have to pay for to keep your business operational, A piece of 2 x 4 Lumber will cost $12.00. But luckily Logging Companies don't overcharge. Trees must be abundant in the Amazon or something. Medium businesses have to pay for that gasoline causing a domino effect. Because medium businesses expect profit of $50 Million a year, and you have about 1 Million of them, that tends to happen everywhere.
@heartlessvietboy If you don't like a business's prices, why are you shopping there? Common sense tell us not to.. Anyway, we all know gas prices are high.. though compared to many places in the world gas is dirt cheap, I know this because I still see huge trucks and hummers all over the place. And it just so happens that oil companies really don't make that much profit, not compared to other corporate giants that I'm sure your familiar with. The price is hardly based on what they want it to be.
I don't shop at all, I save my money. I only buy what I Need, not much of what I want. I think resources and human work should be valued. Not to be wasting lavishly and carelessly. The way I live right now is at 80% High Quality. Thats the best I can do. Anymore I'll be in a coffin with the rest of the great ones.
When you have 1 Million businesses expecting 50 million dollar profits, thats what happens. When you have politicians cashing-in off the System, thats what happens. Because had gasoline been $1.25 a gallon (real value), our corporations Hershey's and M& M's investment in, wouldn't have increased the price. Had Oil companies and their shareholders not want a .10 cents of every barrel = Millions, Oil wouldn't be that expensive.
@heartlessvietboy You've got it about 100% wrong. But the way you think is quite entertaining. You describe inflation, sure, but the CAUSE of inflation is what we're interested in. If inflation was anything like you describe it, it would be self healing. If a business felt that government fees were too high, then they would pass the fee to the consumer, this would be a one-time-thing, and this is what you're calling inflation? You speak as if private businesses owe you something.
Inflation is natural, it continues if we don't regulate what needs to be regulated. If we tax by income how can they make any money. Do you get what I'm saying? If Hershey's is complaining that they have just been taxed an extra 45%, so they increase the price of their candies 45% then people just won't buy and the Government will take over. America was built on allowing Christopher Columbus to take Slaves and Corporations to take Resources.
Corporations are making too much money. We need get back to small simple business perspective. Because we didn't tax properly this is what happens. Billionaires.
Wall street is not allowing prosperity. Its allowing corruption. The Stock Exchange is a Lie!!
@heartlessvietboy Ok man let's just agree to disagree on some things because I'm tired of having the same argument over and over, consider that a win if you want, it makes no difference to me. But I must say, it astounds me that you think citizens should have to pay such insanely high taxes as 50%. For the life of me, I don't understand why you feel a right to someone else's hard work. But I can agree with you one one little factor and that's the fact that I don't care much for the Wal-Marts
LOL. I don't think Citizens should be taxed much at all. I think Corporations making too much money should be higher taxed. Had we implement a good honest system a long time ago, Taxing wouldn't be an issue against the Rich. Had Prohibition been successful, we would've saved 100,000 Human Lives. Think about it.
Thats not hard work. Thats World Wide Corporate Domination. Thats Stock Market at its best. Thats Therapy. LOL.
And there are lots of Normal Everyday people at WalMart. Those who choose not to go to WalMart because they think its Low-Class and a shame may be Wrong.
When a person makes $50 Million they should have been taxed 50%. But we didn't. Instead the Government opens a Stock Exchange for themselves, Supreme Court, and Law Attorneys to profit off the $50 Million.
It's still not too late to increase Tax on the Rich. If Corporations (wall Street and others) double the price of their products, good bye to them because nobody will buy a pair of jeans for $100 dollars. Goodbye to J.P Barnes & Nobles selling Barack Obama books for $100 Million Dollar Profit.
And Nobody Bought the book. It went on shelves "as sold" when they "sold it to themselves". Meanwhile New York Times best seller Tiny Tim is Ranting and Raving about "Special Special Read All About It!!!" "Best Seller Best Seller!!" There are 1,000 New York Times best seller. Which one is it?
That's why we need to help them clean up their way of life. Motorcycles are leaking oil all through the water. It's polluting their environment. I don't know if this system is about us or about them. But all i've been hearing is, "Get out of Iraq!" etc. They need our help.
Sorry, I got it now. Please tell me more about how Large Corporations are the reason why we American's can buy Luxury Cars while the Wealthy in other countries are peddling bicycles.
@heartlessvietboy Reading back, you say inflation is caused by greed. That's a bold statement. I guess peoples' greed increases at a steady rate to, about .3 percent every year. I said inflation is caused by government printing money, and that is an unarguable fact. If you have a problem with that, well then you're just going to have to do some research. Business owners wish they could be a greedy as you accuse them of, but competition says they can't. Ultimately, consumers chose what to spend
@heartlessvietboy their money on. If you think the price of cell phone service is too high, then why do you use a cell-phone? Ask me how I know you have a cell-phone. And guess who doesn't? Yours truly. Reading back, you think oil companies should make no profit. That's laughable, why the hell should they supply you with oil for nothing? I bet you have a car also, which means you're part of the problem.
I don't have a cell phone. I haven't had a cell phone since 2008. When I have a job I will buy me one that has internet, reliable and not expensive. I do not like cell phone contracts. I would rather pay straight forward. The same with a Car. I don't have a car because it broke down. I'm looking for a job but not many people are hiring. Their picky about who they hire. I understand.
America is in the process of Helping better the world while bettering our country. By this we are stopping needless production, beginning farming and clean energy, and preventing the Stock Market from Creating Billionaire's overnight.
@sugminpurjo2 - BS? ha ha funny you should say that because you clearly full of it.
Better explanation? worst shot video with the tinniest sound and dodgy visual graphics i have come across. Headache material. Its so bad i stopped after 6 seconds... could be a better explanation but nobody is gonna hang around to find out.
The idea that inflation is based on wage increases is so 1970's... we are talking about commodity driven inflation - cost of goods going up dramatically (look at commodity prices at all levels) and also a loss of faith in currency = hyperinflation. Not "money flowing through the system"
But what about the stimulus money effecting the purchasing power of the dollar. i was told that the more stimulus money that not back up by gold bring down the spending power of the dollar it that true? and if so how does the play into the inflation process?
Inflation or deflation aren't alway bad, but there is the danger it creates a spiral, where in inflation, people fear their money will be worse less tommorow so they spend it today and there is a run on goods and that further increases inflation, or with deflation, people hold off on purchases because prices are expected to fall, and then the economy grinds to a standstill, demand plummets, and prices fall further. Inflation discourages saving and deflation discourages spending.
Even more simple: Before QE Money in system : $1000 Average income: $100 Goods / services in system : 1000 Price per unit: $1 After QE ($1000) Average income: $100,- Money in system : $1000 + $1000 = $2000 Goods/serviices in system: 1000 Since the value of the goods or productivity has not been increased, now the price per unit increases to $2,- once the money gets into the real economy. Inflation = 2/1 = 100%, so real spending power drops with 50% (100/2 = 50%). .
Great video ! Have you seen all the crap the youtube community makes on inflation? One guy who has 600 000 views basically sets inflation equal gold price, which is just horribly wrong. This shows that people shop around in opinions as they do in religions, even though information and knowledge is not exactly a free for all, one man one vote system. I hope your video will get more views, good luck !
Classic Keynes, Austrian economics makes far better since, check out mises, here on youtube or their site, Peter Schiff is another good source. But simply inflation is the printing of money, the rising prices of products is the result of that money inflation. Look at the fiat money system as a unlimited resource, as you(the FED), print more of it, it's value goes down(the Dollar), and then it takes more dollars to buy the same products that you once could.
When people talk about inflation, they generally mean ONE OF TWO things:
a) expansion of the money supply (monetary inflation), or
b) a rise in the average price level of goods (price inflation).
Whether or not the CPI is a good INDICATOR of the latter, or the former, is often debated. The CPI is an index, & many economists would argue that it's geared to under-report inflation (since for example, it leaves out food & energy).
Some would argue that the price of gold is a better indicator.
@D4Shawn I heard food and energy were left out of the CPI calculations also. I was challenged on it when I repeated it so I checked it out and found I was wrong. I don't beleive CPI is truthful but food and energy are not the problem.
If the economy crashes.. I wanna have all of the Ambev`s stocks, cause the beer consumption as he says, will fly to the sky.. Lets drink folks.. And lets get rich meanwile people sufer and get drunk.
hello yea, the 10 trillion is both a result of government printing and price speculation, which means people thought that there assets were worth more than they actually were.
The Federal Reserve prints it up through the government. The banks do not lend it out because unemployment is still at 10%.When the unemployment goes down, mainly through public works and make work jobs by the government, people will have cash on hand and maybe making enough for lenders to loan at better interest rates for them. Eventually thought this "false" cash will be used up again and the bubble will burst with even worse results
He leaves out that once the dollar loses its reserve status, which is a foregone conclusion over the next decade or so, the dollars will return devalued. Besides the contracted credit markets, we do not feel the inflation yet because of the # of dollars in circulation (electronically) worldwide. This, too, will change.
I find these vblogs very helpful. But, the inflation predicted by some commentators results from currency devaluation, not an increase in the money supply to Joe public. Amongst the industrialised nations the US&UK are most at risk, because of our large trade deficits and levels of debt to other nations. Should a major creditor nation start to off load this debt, our currencies will devalue causing inflation in the goods we import. A vblog on why exchange rates fluctuate would be very helpful.
If you held a trillion IOUs you wound not dump a half making your remain half worthless
Worse likely case is that you would curtail increases which in it self cause some devaluation/inflation but not end of the world Peter Schiff scenarios.
great explanation
123koyya 3 days ago
The premise is faulty, and all the witchdoctors promoting 'natural and good 3% inflation' are quacks. Its a simple mental exercise to see that DEFLATION should be the norm. True growth in productivity means that the cost of production is dropping. Dropping costs equal dropping prices. With increased automation, we should see steady decreases in employment and costs, moving towards a future gift economy. Fact.
hep48 6 days ago
what country is he from, and adressing?
abdullahalmahmood 1 week ago
the guy is dyslexic, that is the way dyslexic people write cpi;including me.
jormoria 2 weeks ago
This video is uses absolutely no logic
bryantonani 1 month ago
Poster needs to correct a major point, the Obama Administration removed food and fuel prices from the reported CPI. These are the two largest drivers of the cost of living. During the Obama Administration fuel prices have increased between 150% and 200%. Food prices are a bit tricky. The price for a box may remain the same but the amount contained in the box decreases. Say the medium sized box of cereal costs $4. It used to contain 18 ounces but now contain 14 ounces.
Robbob9933 1 month ago
@Robbob9933 this is an important point but a point that is not necessary for the video. The video is simply to explain the concept of of inflation for those who do not understand it. Bringing in the element of what makes up the CPI (and the politics behind it) adds a level of complication and subjectivity that would take away from the core purpose of the video (i.e. explain the concept of inflation in a simple way that is easy to understand).
1601tgc 1 month ago
@1601tgc When the two item that impact the cost of life are removed from the CPI, it gives a false picture as the health and stability of the economy. If people really understood that inflation is roughly 10 times what is being reported, they would through a fit and would demand spending be reigned in. Causing people to be blissfully ignorant is pure evil.
Robbob9933 1 month ago
@Robbob9933 Just avoiding protests
Billyscccu 1 week ago
so the bottom line is greed causes inflation. It is not because the dollar has lost value it is because people want to over consume. this falls inline with the fact the dollar had gained 450% in value over the last 60 years and remains strong.
Thewizzardof9 1 month ago
Hmmm.. I feel like this would work out okay in the end were it not for the fact that such a huge portion of that $10 t (which has actually been found to be around $16 t) were going to pay for treasury securities, since this is what the banks are doing with the money they've been lent by the Fed. This is forming a "government bubble" and there's no way to get rid of that debt without either high taxes or inflation combined with austerity measures. Wonder how this will work out in a few years...
lalem91 1 month ago
why does someone need a pager to make a youtube video??...
ty99999returns 1 month ago
I'm just going to get all my money converted to gold...
Palafico3 2 months ago
What the bankers have done is established "their" private banks in the industrialized nations so that when the governments need money, the private banks are the only place to get it. Therefore, the gov. is dependent on the bank for its cash flow which all of it is borrowed making the national debt skyrocket, and then it's placed on the backs of the people.
Desertspring877 3 months ago
i love this guy:)
amina555 3 months ago
Brilliant! Thank you.
tqmania12 3 months ago
That's the problem with a federal reserve note.
pooptickler1337 3 months ago
and the trillions the Fed is creating get multiplied by fractional reserve banking as the economy picks up.
DCUPtoejuice 4 months ago
Except now let's talk about reality. The Consumer Price Index is a fraud so Bill doesn't get any raises, prices keep rising, banks get 0% interest from the Fed and turn around and charge Bill 14% for a car loan & $30% on his credit card because they keep changing the due date so they hope he will turn it in late one month so they can jack his rates and the banks get rich, Bill gets poorer & the top 2% get 90% of all the wealth since Bush took office back in 2000.
dishesdealer417 4 months ago 2
Food & Fuel is not included in the CPI so that they can make it look like there is less inflation. They use Hedonics to substitute less expensive items that do the same thing to also fraudulently lower the index.
dishesdealer417 4 months ago 13
@dishesdealer417 Actually the CPI does include food in it. bls.gov/news.release/cpi.nr0.htm
You're thinking of core inflation, which strips out energy and food prices.
bowchikabowbow 2 months ago
@dishesdealer417 Back in the 1970s, they would actually inventory shopping carts.
Robbob9933 1 week ago
The kids always be taking my lucky charms.
thelastsadpanda 5 months ago
Forgive me if this is a really dumb question but I have not been able to figure this out.Does the federal reserve just print money and then give it to the private banks for free so they can lend it out and make money off of it ? I don't understand how this system works.
ryan84160 5 months ago
@ryan84160
The Fed's interest rates are 0 so the banks do get it for free. The Fed eases the money into the system so the banks will lend to people so the economy picks up again. Once the economy is up again the Fed can then raise interest rates and collect money back in.
Transkar 5 months ago
@Transkar This seems ridiculously unfair.
ryan84160 5 months ago 3
Respond to this video... If they really wanted to pump more money into the system, why couldn't the Fed just give low or no interest loans directly to the public ?
ryan84160 5 months ago
@ryan84160
Because the public will spend it and drive up the cost of goods and start another bubble. If banks hand out the loans then they can check to see who qualifies for them and can "ease" money and loans onto the public. Watch the Quantitative Easing video to learn more about it.
Transkar 5 months ago
@Transkar
And when I say spend it, I say SPEND it like immediately.
Transkar 5 months ago
@ryan84160 it is even easier than that, just cut taxes.
DCUPtoejuice 4 months ago
@DCUPtoejuice You already have a massive deficit.
ryan84160 4 months ago
@ryan84160 since we are in a money debt system, the debt has to be created somewhere to increase money supply and it is best to put that money directly into the hands of the people instead of into the banks who refuse to loan it out.
DCUPtoejuice 4 months ago
@DCUPtoejuice Do you mean just print the money and give it directly to the people who will spend it ?
ryan84160 4 months ago
@ryan84160 you are correct
vanskiid 5 months ago
@ryan84160 Yes, you have it. Add to it that the federal reserve is private, so it's just private bankers who own it. It's akin to me drawing a dollar bill, loaning it to you, you spend it, and pay me back my dollar plus interest. The bank in the middle is just part of the Fed Reserve System, but yes, they profit off of it as well. But the big problem is we owe a debt for every dollar created by the private Fed, and since they only print principle, never the interest, we'll never pay it off.
mikejadoti 3 months ago
@mikejadoti This just seems like insanity to me. I mean how did this system get set up in the first place ? It is obviously rigged in favour of wealthy bankers and no one had a problem with this?
ryan84160 3 months ago
Hold on bro. You said it yourself that the banks were using the QE money to buy government bonds. The government does spend it. Government employees and subcontractors spend it and through the deficit it goes over sees to China. The US is exporting their inflation.
Fernandolunatoro1 6 months ago
For those interested in the subject of inflation, look up Milton Friedman!
ChristopherAdderley 6 months ago
The Elite are the ones with mass cash, bacause we are not. Middleclass has been paid the same avg or less, but all the prices are going up. Food, gas, clothes, car taxes, electronics is the thing I will say going down. That means reality is worst than our video.
1515alanruiz 6 months ago
thank you :)
tanis47 6 months ago
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A biggest public campaign has started to end fractional reserve banking, look at the POSITIVE MONEY website and support the campaign ...and spread the word.
PositiveMoneyUK 7 months ago
In the UK now we are seeing the effects of inflation. However with the government making huge government spending cuts and soon higher interest rates, we are just going from one extreme to another. The truth is with huge unemployment people wont be able to go out and buy the "lucky charms". So if the banks aren't lending and still they are making a loss, where is the money? iit is probably getting under run by the chinese
great videos though, learnt alot for a level economics
NathJames93 7 months ago
Some assets were overinflated (Bubbles) and these are correcting downward --houses for example--while most other items we use every day---food, gas, health insurance, health care--are rapidly rising to the turn of 10-20% per year.
Some call this Biflation.
This is harmful and destroys savers and retirees while favoring debtors like banks and people who spent too much during the last decade instead of being frugal. Savers are sacrificed to the benefit of debtors and spenders.GL!
rigoletto68 7 months ago
simple, whe nthe economy recovers and banks start lending out again the fed should enact contractionary policy, (selling treasuries) in effect "destroying" money and keeping inflation low. However, because it is difficult to determine exactly when the economy has "recovered" the fed will probably keep expansionary policy going to long and there will probably be mild inflation, Between 4-5%
durhamdf 8 months ago
@durhamdf 1. if inlflation is allowed to exist, doesn't that in effect destroy the value of money rather deliberately. 2. if the cost of living and raises are outstripped by the overall rise of and on available money isn't that a true sign of a failing economy. 3. is the federal reserve regulated in any way by the government? I truely dont know and haven't been able find any credible info. Isn't federal lending just really complicated gambling?
godspawn007 8 months ago
@godspawn007 Inflation does destroy the value of money, but at the natural rate of inflation, it is keeping up perfectly with the growth in output and wages will keep up. Inflation beyond the natural rate is what we actually experience, which we are not at yet, and actually does benefit the lower/middle class debtors against the big creditors. The Fed is "independent" but the president and congress can replace the board of governors on staggered terms, because of this the Fed is politicized
durhamdf 8 months ago
@durhamdf a separate issue I see is that this country as a whole loves to push its overall wealth or lack thereof down the road to future generations. We love to operate on credit lines rather than do the responsible thing and not purchase things we actually cant afford. What happens when those credit lines dry up or pull too thin? We're seeing this right now, yes? Do we as a nation need to think better about money in general? What about the abundance of lawyers, beaurocrats, BAD yes or no?
godspawn007 6 months ago
I don't agree with your premise. Inflation is not natural at all. It is caused by money creation by central banks in cahoots with gov'ts. Rising prices are a symptom of inflation, not the definition. It does not affect all sectors of the economy uniformly. Without currency debasement, a more natural state would likely be declining prices overall as productivity rises.
razerfish 8 months ago
Check out the video Collapse of the Dollar 2012!
2010blufish 8 months ago
why are you people so rude? damn!
jimmychooshoes0512 8 months ago
Is it just me or has this man no clue??
warrenkavanagh 8 months ago
of the world either. Our differences would be how we would deal with the issue. Where you would try to hurt the large businesses, I would aid smaller businesses rather than taxing them to closure. I hope you realize that you contradicted yourself a little bit. If you are "pro small business," then you must also be fine with paying higher prices. Small businesses are known for making better products, for a larger price. Large corporations are the reason why even the low class American's can
EJWProduction 8 months ago
I'm not trying to hurt them. It's the Overall good. When you're wrong and it's bad, it shouldn't be. It's that simple. "Small Businesses" and Corporations are different. When small businesses fail because they are overcharging, it doesn't cause a collapse in the system. I don't know how Corporate America works. You can contact Subway and ask if you can run one of their Chains. I don't know who is doing that here where I live.
heartlessvietboy 8 months ago
@heartlessvietboy Yes, you did say you would try to hurt them. By taxing them 50%!!! Are you mad? Should success come with such a downfall? Why do you believe in limitations on success? Do explain. And yes, what I previously said IS hard work. A billion dollar corporation doesn't spawn out of a poor immigrant's ass. Hard work, VERY hard work, and dedication are the recipe for such. Like I said before, if the people are against large corporations, then WHY ARE THEY SUPPORTING THEM?
EJWProduction 8 months ago
@EJWProduction It seems to me that you are in the wrong place, there are several places in the world where someone like you could be happy with big government regulating every thing you do. Perhaps instead of trying to drag down the richest, most powerful country in the world (and there is a reason for that), you should simply go somewhere that suits you better.
EJWProduction 8 months ago
Government is not regulating everything you do. It's called Taxing the Wealthy because they are damaging the economy. The reason why you are making money is because your government created the currency. You're approaching your thinking from an evil Government perspective bashing on Government "Total" control for some reason. Evil Government is the reason why 1/2 of human population nearly went extinct you idiot!!
heartlessvietboy 8 months ago
@heartlessvietboy No, you're an idiot and you're a thief. There is nothing worse than someone who keeps making the same mistakes over and over again, never learning from history.
EJWProduction 8 months ago
How can I be a Thief. I'm the reason why you have money in your pockets. Are you going to make all the steel and own all the gold? Are you not going to share with your fellow human beings? Are you going to let us starve? Aren't we going to farm ourselves? Aren't we going to take your gold and steel?
heartlessvietboy 8 months ago
@heartlessvietboy You call it forced donations, I call it theft. You are most definitely NOT the reason I have money in my pockets, beside, I'd much rather have gold, or anything other than worthless paper in my pockets anyway. No, why would I share with people when I work hard for what I have, I feel that everyone should do for themselves and mind their own; however, some charity would be necessary and would be given to those in need. I hate parasites, the people who feed off of others, because
EJWProduction 8 months ago
Mine all the Gold you want. People will want to trade their potatoes and tomatoes with you. They would die for something that is useless. Id rather get lumber to build a house and food to eat. Food is to eat not to trade. Grow your own food and eat.
heartlessvietboy 8 months ago
@heartlessvietboy because they lack the motive to provide for themselves. Charity is completely fine with me and I happen to be very charitable. Hell, I bet I donate much more money than you do on the monthly basis. I do not believe people should be forced to donate via taxation or by any other means.
EJWProduction 8 months ago
Eliminate Government. Nobody asked for TV's and DVD players. Nobody asked for McDonald's and Taco Bells. I grow my own food to eat on "my land". Land is for everybody. Nobody asked for anything, we were happy the way it was. A simple life. Until Government came in and started developing and polluting the entire World. I grow my food you grow yours. Leave me alone, I can do whatever I want to do "grow whatever I want to grow". I give when I want to. I am free this way.
heartlessvietboy 8 months ago
Taxing regular everyday citizens and small business owners too much when they are not making enough money isn't ideal. You only need to tax when resources are running low or when certain resources are being wasted too much.
heartlessvietboy 8 months ago
@heartlessvietboy Oh and one more thing. I am by no means a rich person. I am a struggling college student. So don't think I'm an executive of some major corporation arguing for my way of life. I work part-time at one of the biggest banks in America, I see the theft that goes and in that respect, I'm assuming we agree that some (minimal) regulation should be put in place. But never should a bank have to pay ridiculous taxes to support some lazy peoples' lavished lifestyle. And don't think for
EJWProduction 8 months ago
You're a struggling college student because you are following a system that's making you struggle. How smart is it for you to argue for freedom and against government taxation when you are willing to be pawn under this system. How do you need to "argue"? Isn't arguing bad? And being an Executive good? You're an executive making millions why do you need to argue for your way of life unless you are doing something that isn't overall good for humanity.
heartlessvietboy 8 months ago
@heartlessvietboy a second that people don't abuse our "government aid" systems. Helping people in need is one thing, but I shouldn't see people on welfare driving in brand new dodge chargers like I do now. I want a charger, perhaps I should just give up on my idea of living and just get the government to buy all my bullshit, in turn letting private businesses buy my bullshit.(being sarcastic here)
EJWProduction 8 months ago
Here is How life should be:
1. Live in your electric car with on board generator.
2. Shower and use restroom at pubic facilities.
3. Buy food fast food to eat. $6.00/meal x 3 meals = $18.00/day.
heartlessvietboy 8 months ago
Don't get me wrong. I worked hard for my money too. I bought my First Car at the age of 18. A Brand New Mitsubishi 3000GT SL. Then I landed a good job that paid well. However I got laid off but found a new job however paid less. That paying less didn't make me very happy so I went looking for another job. I landed a job that paid me as well as the previous job. There I made my money until I was Laid off again.
heartlessvietboy 8 months ago
My mother kept on telling me to go to school when I had no clue what to do. Maybe we do need guidance. It's like elementary they drop you off and you walk to your classroom. Your class schedule is listed by period and times. You follow your schedule which is quite fun in the summer time laying and reading your school schedule. First day of class, some people knew eachother, some were your former elementary students. Thats Life for yah. Then the bell rings and you go home get ready for work.
heartlessvietboy 8 months ago
You take bull sh** classes going no where. Counselors don't know what you want because you "don't know what you want" unless you are "all prepared in life". That's life for yah. 60% of students don't even do what they went to school for. They don't even really know what they want! Some fail, lay around look for a job paying $7.25/Hr. Does that sound fundamentally as an "Ideal" system?
heartlessvietboy 8 months ago
Meanwhile mother and father is breeding 6-10 children per family. Population growth has reached 7 Billion. The European's nearly wiped themselves out from waging war. Japan ate 2 Hydrogen (Nuclear) Bombs.
heartlessvietboy 8 months ago
We are not stupid. Give us a schedule and we abide by it. How does the school system even keep track of you to send letters to your house and call you to remind you to go to school?? Meeting your teachers before school begins isn't something I recall liking. However Open House sounds interesting. Thats the stuff that went on in my mind as a kid. I grew up in San Francisco California so it could be different elsewhere.
heartlessvietboy 8 months ago
I didn't increase Taxes to hurt them. I increased Taxes because its the right thing to do. Are there limitations on how you behave? Success is a feeling and is that. If we don't limit, are we to take everything? We live and we're the making of our world and our society. There's no such thing as success or pursuing success in other countries. Its just called work and make money. You see, America teaches these things to people about success and knowledge when its not real.
heartlessvietboy 8 months ago
I am not against large businesses. I am against damaging the economy.
heartlessvietboy 8 months ago
First of all, inflation is expansion of the money supply, while rising prices are symptoms of inflation. But there is a lot of dimensions this video fails to look at, which are the cause for the symptoms of inflation we are experiencing right now, that is the defficit spending by govt. which throws money right into the economy.
Warzoooooo 8 months ago
/watch?v=4Z9WVZddH9w
AtheistAnarchoRudi 9 months ago
You explanation of inflation is incorrect. The company who raise the cereal price do not do it because they see demand increase but because their factors of production increase ie. that they need more resources to create more goods to meet increased demand and so the unit cost increases.
MrSmackdown100 9 months ago
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Same in UK:- INFLATION is expected to come down when the job losses hit but what a crazy, crazy way to go on:- slow the economy to tackle inflation when the BANK OF ENGLAND ADMITS IT DOESNT KNOW WHAT THE REAL RATE IS!
sue75lewis 9 months ago
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Only the FDR Glass-Steagall principle will separate commercial from speculative banking, thus freeing the nation from obligations to Wall St. and the City of London, and re-establishing a credit system for rebuilding the nation.
H.R. 1489, Return to Prudent Banking Act of 2011, is before the House of Representatives, which aims to revive the separation between commercial banking and the securities business, in the manner provided in the Banking Act of 1933, the so called 'Glass-Steagall Act
tepstolog 9 months ago
thanks to this person who made me understand what inflation is, may god reward you
TheOujdie 9 months ago
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Love the video work nice keep them coming! When you have time come visit my channel!
TheHcgdietplan 9 months ago
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Love the video work nice keep them coming! When you have time come visit my channel!
FatReleaseSystem 9 months ago
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Love the video work nice keep them coming! When you have time come visit my channel!
850Nexus 9 months ago
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Love the video work nice keep them coming! When you have time come visit my channel!
pheromoneaction 9 months ago
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Love the video work nice keep them coming! When you have time come visit my channel!
chocolatediet11 9 months ago
No matter what people say but the best way to teach is to engage the audience regardless of how they do it...this guy clearly knows how to do this. Great stuff! And really helpful.
MrQazid 9 months ago
This is the most child-like explanation I've ever heard of inflation - who do you think your audience is?
shanemacc 9 months ago
wow!! impressive~~!!!
sahazadshad 9 months ago
This is a joke. Don't you see the moral hazard of this. Why allow the government to steal from savers so Bill can have more salary. It is a joke. This is voodoo economics. We need the end the ability of the government to create money, force banks to close their doors so they can do something productive, and have government employees be fired so they can enter the private sector.
pirucreek 10 months ago
Well said. Cute teacher
1l2l3o4p56j 10 months ago
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Great explanation of how finance works in these videos. Makes me want to have a drink though.
biowax 10 months ago
Great explanation in these financial videos. Makes me want to have a drink though.
biowax 10 months ago
Blamed everyone but the real culprit . The Federal reserve has devalued the dollar 98% there is nothing wrong with that? who cares about prices when our real cost of living is going up while incomes are stagnate ,no job recovery ,no prospects on the horizon after pumping ONE TRILLION SIX HUNDRED BILLION QE 1,2 OF fake fed notes into the phony system of outlaw gamblers. where is all that multiplier action at now lord keynes ? Ron Paul and the Austrians were right for the last 30 years plus...
blowbackinevitable 11 months ago
We are being made poorer and poorer. It can't go on like this.
tellyontellyon 11 months ago
The concept is that there is a limited number of goods and services to buy. The more money people have to buy limited resources with, the more expensive those resources will get. The idea behind stimulus is that by making stuff more expensive people will start producing more to take advantage of high prices.
The problem is that stimulus usually feeds into distortions and bubbles. The system becomes unstable, then gradually unsustainable. The correction then causes recessions.
trentable 11 months ago
The reason for inflation is that businesses are charging too much thus causing a domino effect. People can naturally increase the prices of their products or services because if they don't it will poison them. Maybe because cost of living is expensive from the real estate industry or gasoline. Or resources are scarce = low income. Basically inflation is when prices are high. If you are talking about Government Currency Value or Government sending money out, that is something different.
heartlessvietboy 11 months ago
Er me thinks he's missing a small point here the value of the $ !! it's not just about cost of prduct and how much someone thinks they can get for it!
sue75lewis 11 months ago
You explained it very well, thank you.
TobiasLillestolen 11 months ago
1. if the bankers get this 10T and into the system, and yet not lending to businesses and individual, why is still getting more T into the system?
2. if the economy recovers, and the 10T got to be taken away from the system (which it has offered little help in the first place), and yet, if not taken away fast enough, it will create problem. So, why in the first place put the 10T into the system? too see if the "taken away" as a spectacular show for the audience??
nicholaschoongws 11 months ago
This is not necessarily all true. The reality is that america is in a period of deflation. Everything is deflating because everything was mostly overvalued. The "fake big number wealth" disintegrated. Instead of a relatively quick correction followed by bankruptcies and a clean up of debt. We have the same unsustainable system running on new money. Maintaining this system becomes a exponentially expensive job. The longer they wait to make corrections, the worse the corrections will be.
trentable 1 year ago
LOL. If we are deflating, why are prices INFLATING?
heartlessvietboy 11 months ago
@heartlessvietboy I think that prices would probably be falling if it wasn't for stimulus and currency inflation.
trentable 11 months ago
Why would stimulus cause inflation? What inflation are you talking about? Shouldn't it help people's income by giving them money to buy products thus prices of those products wont increase because business owners are making money?
heartlessvietboy 11 months ago
@heartlessvietboy Hah, let's just give everyone a million dollars. Then they can quit their jobs at, for the sake of example, Mrs. Sue's Diner, leaving Ol' Ms. Sue fucked. But, Ms. Sue can stay in business if she pays emplyees 100 grand a year. Who's pass that up, even if you had a mil? I know I wouldn't. But how in the hell is Ms. Sue suppose to afford all that? By raising the price of her hamburgers from $5.00 (lunch special, comes with fries) to $105. Million isnt so great anymore eh?
EJWProduction 10 months ago
Inflation is because of Greed and Wall Street. They want to make $1 Billion/year. The everyday human just wants to make 100K a year. They can barely make 40K a year!
heartlessvietboy 8 months ago
@heartlessvietboy You speak of greed as if it's a bad thing. First of all, I don't see why you socialists like getting involved in everyone's personal interests so much, but since you are, don't you understand that it's greed that developed the modern world? Let's talk about modern medicine,the same medicine and medical procedures that give people life and well being, hundreds of thousands on the daily basis. You really think people go to medical school for the sake of helping people?
EJWProduction 8 months ago
Greed is bad when you're neglecting people's happiness and their well being.
heartlessvietboy 8 months ago
How do you make medicine? How does it become tablet form?
heartlessvietboy 8 months ago
@heartlessvietboy While that would be nice, let's stick to reality shall we. Besides, free people are the most charitable people in the world. I realize that Wall Street, big banks and corporate giants dosome pretty messed up things, everything has a downside and those situations can be fixed without much government regulation or control anyway. To get back on topic, inflation is the result of government dumping money into the system, borrowing money from "the future buying potential of America"
EJWProduction 8 months ago
@EJWProduction **Future earning potential** is a better way of putting it.
EJWProduction 8 months ago
Third world countries are free, I don't see them giving to Charity. Reality is inflation is caused by Corporate greed. When you are burdened trying to pay rent, you increase the price of your products. When gasoline is emptying your pockets every month, when you feel a $500 registration fee is too much, you increase the price of your products to balance out that loss. But guess what, 80% of Americans don't own businesses so how can they increase the price of a product they don't own?
heartlessvietboy 8 months ago
When Gasoline prices are high, meaning $3.50 x 1 Million Gals. you have to pay for to keep your business operational, A piece of 2 x 4 Lumber will cost $12.00. But luckily Logging Companies don't overcharge. Trees must be abundant in the Amazon or something. Medium businesses have to pay for that gasoline causing a domino effect. Because medium businesses expect profit of $50 Million a year, and you have about 1 Million of them, that tends to happen everywhere.
heartlessvietboy 8 months ago
@heartlessvietboy If you don't like a business's prices, why are you shopping there? Common sense tell us not to.. Anyway, we all know gas prices are high.. though compared to many places in the world gas is dirt cheap, I know this because I still see huge trucks and hummers all over the place. And it just so happens that oil companies really don't make that much profit, not compared to other corporate giants that I'm sure your familiar with. The price is hardly based on what they want it to be.
EJWProduction 8 months ago
I don't shop at all, I save my money. I only buy what I Need, not much of what I want. I think resources and human work should be valued. Not to be wasting lavishly and carelessly. The way I live right now is at 80% High Quality. Thats the best I can do. Anymore I'll be in a coffin with the rest of the great ones.
heartlessvietboy 8 months ago
When you have 1 Million businesses expecting 50 million dollar profits, thats what happens. When you have politicians cashing-in off the System, thats what happens. Because had gasoline been $1.25 a gallon (real value), our corporations Hershey's and M& M's investment in, wouldn't have increased the price. Had Oil companies and their shareholders not want a .10 cents of every barrel = Millions, Oil wouldn't be that expensive.
heartlessvietboy 8 months ago
@heartlessvietboy You've got it about 100% wrong. But the way you think is quite entertaining. You describe inflation, sure, but the CAUSE of inflation is what we're interested in. If inflation was anything like you describe it, it would be self healing. If a business felt that government fees were too high, then they would pass the fee to the consumer, this would be a one-time-thing, and this is what you're calling inflation? You speak as if private businesses owe you something.
EJWProduction 8 months ago
Inflation is natural, it continues if we don't regulate what needs to be regulated. If we tax by income how can they make any money. Do you get what I'm saying? If Hershey's is complaining that they have just been taxed an extra 45%, so they increase the price of their candies 45% then people just won't buy and the Government will take over. America was built on allowing Christopher Columbus to take Slaves and Corporations to take Resources.
heartlessvietboy 8 months ago
Corporations are making too much money. We need get back to small simple business perspective. Because we didn't tax properly this is what happens. Billionaires.
Wall street is not allowing prosperity. Its allowing corruption. The Stock Exchange is a Lie!!
heartlessvietboy 8 months ago
@heartlessvietboy Ok man let's just agree to disagree on some things because I'm tired of having the same argument over and over, consider that a win if you want, it makes no difference to me. But I must say, it astounds me that you think citizens should have to pay such insanely high taxes as 50%. For the life of me, I don't understand why you feel a right to someone else's hard work. But I can agree with you one one little factor and that's the fact that I don't care much for the Wal-Marts
EJWProduction 8 months ago
LOL. I don't think Citizens should be taxed much at all. I think Corporations making too much money should be higher taxed. Had we implement a good honest system a long time ago, Taxing wouldn't be an issue against the Rich. Had Prohibition been successful, we would've saved 100,000 Human Lives. Think about it.
heartlessvietboy 8 months ago
Thats not hard work. Thats World Wide Corporate Domination. Thats Stock Market at its best. Thats Therapy. LOL.
And there are lots of Normal Everyday people at WalMart. Those who choose not to go to WalMart because they think its Low-Class and a shame may be Wrong.
heartlessvietboy 8 months ago
When a person makes $50 Million they should have been taxed 50%. But we didn't. Instead the Government opens a Stock Exchange for themselves, Supreme Court, and Law Attorneys to profit off the $50 Million.
heartlessvietboy 8 months ago
It's still not too late to increase Tax on the Rich. If Corporations (wall Street and others) double the price of their products, good bye to them because nobody will buy a pair of jeans for $100 dollars. Goodbye to J.P Barnes & Nobles selling Barack Obama books for $100 Million Dollar Profit.
heartlessvietboy 8 months ago
And Nobody Bought the book. It went on shelves "as sold" when they "sold it to themselves". Meanwhile New York Times best seller Tiny Tim is Ranting and Raving about "Special Special Read All About It!!!" "Best Seller Best Seller!!" There are 1,000 New York Times best seller. Which one is it?
heartlessvietboy 8 months ago
@heartlessvietboy afford to buy luxury cars, and drive them, whereas the wealthy of other countries are peddling bicycles.
EJWProduction 8 months ago
That's why we need to help them clean up their way of life. Motorcycles are leaking oil all through the water. It's polluting their environment. I don't know if this system is about us or about them. But all i've been hearing is, "Get out of Iraq!" etc. They need our help.
heartlessvietboy 8 months ago
This has been flagged as spam show
Please tell me why you said, "afford to buy luxury cars, and drive them, whereas the wealthy of other countries are peddling bicycles".
heartlessvietboy 8 months ago
Sorry, I got it now. Please tell me more about how Large Corporations are the reason why we American's can buy Luxury Cars while the Wealthy in other countries are peddling bicycles.
heartlessvietboy 8 months ago
Inflation can go to the People's Economic Digression Review Board to examine the Trends of Economic Growth and Inflation.
heartlessvietboy 8 months ago
@heartlessvietboy Reading back, you say inflation is caused by greed. That's a bold statement. I guess peoples' greed increases at a steady rate to, about .3 percent every year. I said inflation is caused by government printing money, and that is an unarguable fact. If you have a problem with that, well then you're just going to have to do some research. Business owners wish they could be a greedy as you accuse them of, but competition says they can't. Ultimately, consumers chose what to spend
EJWProduction 8 months ago
@heartlessvietboy their money on. If you think the price of cell phone service is too high, then why do you use a cell-phone? Ask me how I know you have a cell-phone. And guess who doesn't? Yours truly. Reading back, you think oil companies should make no profit. That's laughable, why the hell should they supply you with oil for nothing? I bet you have a car also, which means you're part of the problem.
EJWProduction 8 months ago
We need to approach business from a small simple and organized nature.
heartlessvietboy 8 months ago
I don't have a cell phone. I haven't had a cell phone since 2008. When I have a job I will buy me one that has internet, reliable and not expensive. I do not like cell phone contracts. I would rather pay straight forward. The same with a Car. I don't have a car because it broke down. I'm looking for a job but not many people are hiring. Their picky about who they hire. I understand.
heartlessvietboy 8 months ago
What stimulus is that? What is currency inflation and what would cause it?
heartlessvietboy 8 months ago
America is in the process of Helping better the world while bettering our country. By this we are stopping needless production, beginning farming and clean energy, and preventing the Stock Market from Creating Billionaire's overnight.
heartlessvietboy 8 months ago
very good clear lecture
Cawley077 1 year ago
What a load of BS. For a better explanation google "21 evils of inflation"
sugminpurjo2 1 year ago 2
@sugminpurjo2 - BS? ha ha funny you should say that because you clearly full of it.
Better explanation? worst shot video with the tinniest sound and dodgy visual graphics i have come across. Headache material. Its so bad i stopped after 6 seconds... could be a better explanation but nobody is gonna hang around to find out.
steviemccallum 11 months ago
Thank you. Love your lectures
bobichina 1 year ago
a lot of good points! great video mate
panzer02sim 1 year ago
The idea that inflation is based on wage increases is so 1970's... we are talking about commodity driven inflation - cost of goods going up dramatically (look at commodity prices at all levels) and also a loss of faith in currency = hyperinflation. Not "money flowing through the system"
alex94115 1 year ago
Whatever, just watch government spending and printing of money then you will see your inflation figures.
sundancekid122 1 year ago
But what about the stimulus money effecting the purchasing power of the dollar. i was told that the more stimulus money that not back up by gold bring down the spending power of the dollar it that true? and if so how does the play into the inflation process?
wildwestphilly 1 year ago
Inflation or deflation aren't alway bad, but there is the danger it creates a spiral, where in inflation, people fear their money will be worse less tommorow so they spend it today and there is a run on goods and that further increases inflation, or with deflation, people hold off on purchases because prices are expected to fall, and then the economy grinds to a standstill, demand plummets, and prices fall further. Inflation discourages saving and deflation discourages spending.
cantroos 1 year ago
Thanks a looot!
meanmachinezzz 1 year ago
Fiscus128 1 year ago
sup bitches .. let's inflate this hoe
yourmomisbadinbed 1 year ago
Great video, well explained.
FideTheProducer 1 year ago
CPI is weighted with hedonics and substitution, so its not a true measure of inflation.
falconxlc 1 year ago 13
excellent work, keep it up. I watch your videos when it is slow in the office
sorcijoe 1 year ago
Great video ! Have you seen all the crap the youtube community makes on inflation? One guy who has 600 000 views basically sets inflation equal gold price, which is just horribly wrong. This shows that people shop around in opinions as they do in religions, even though information and knowledge is not exactly a free for all, one man one vote system. I hope your video will get more views, good luck !
jahege 1 year ago
Classic Keynes, Austrian economics makes far better since, check out mises, here on youtube or their site, Peter Schiff is another good source. But simply inflation is the printing of money, the rising prices of products is the result of that money inflation. Look at the fiat money system as a unlimited resource, as you(the FED), print more of it, it's value goes down(the Dollar), and then it takes more dollars to buy the same products that you once could.
MBillCylle 1 year ago
You explained that better than my teacher :) I thank you !
TheGreatBritishTeen 1 year ago
me am off to the pub for a drink
cray32 2 years ago
Having watched this video, I need a drink.
WizardKing78 2 years ago
Love the great information- Thanks!
wordsworth727 2 years ago
When people talk about inflation, they generally mean ONE OF TWO things:
a) expansion of the money supply (monetary inflation), or
b) a rise in the average price level of goods (price inflation).
Whether or not the CPI is a good INDICATOR of the latter, or the former, is often debated. The CPI is an index, & many economists would argue that it's geared to under-report inflation (since for example, it leaves out food & energy).
Some would argue that the price of gold is a better indicator.
D4Shawn 2 years ago
@D4Shawn I heard food and energy were left out of the CPI calculations also. I was challenged on it when I repeated it so I checked it out and found I was wrong. I don't beleive CPI is truthful but food and energy are not the problem.
Joeys48 1 year ago
If the economy crashes.. I wanna have all of the Ambev`s stocks, cause the beer consumption as he says, will fly to the sky.. Lets drink folks.. And lets get rich meanwile people sufer and get drunk.
emaildodanilo1 2 years ago
great explanation. thank you very much for the post!
emailbryan 2 years ago
Why are the banks not letting people borrow "right now"? Because the economy is bad? What makes the economy bad?
Also, where does the 10 trillion come from? Does the government just print it up?
courtneylvgirl 2 years ago
hello yea, the 10 trillion is both a result of government printing and price speculation, which means people thought that there assets were worth more than they actually were.
afurrypanda 2 years ago
The Federal Reserve prints it up through the government. The banks do not lend it out because unemployment is still at 10%.When the unemployment goes down, mainly through public works and make work jobs by the government, people will have cash on hand and maybe making enough for lenders to loan at better interest rates for them. Eventually thought this "false" cash will be used up again and the bubble will burst with even worse results
whittvet 1 year ago
He leaves out that once the dollar loses its reserve status, which is a foregone conclusion over the next decade or so, the dollars will return devalued. Besides the contracted credit markets, we do not feel the inflation yet because of the # of dollars in circulation (electronically) worldwide. This, too, will change.
MarcusCMarcellus 2 years ago
I think credit care companies have taken 2 to 3 trillion out of the economy by cutting back. Anyone out there know ?
tfrenn 2 years ago
it's rarely that there is just one reason behind a rise in inflation.
alehud 2 years ago
Finaly a video about inflation. You did have ever forget to mention devalue in dollar because of exchangerate skyrocketing.
Nice haircut but the way :)
BabyBacon 2 years ago
Lol!! THat was Great!!! I lol a lot in it!
BlueTunisia 2 years ago
I find these vblogs very helpful. But, the inflation predicted by some commentators results from currency devaluation, not an increase in the money supply to Joe public. Amongst the industrialised nations the US&UK are most at risk, because of our large trade deficits and levels of debt to other nations. Should a major creditor nation start to off load this debt, our currencies will devalue causing inflation in the goods we import. A vblog on why exchange rates fluctuate would be very helpful.
robdev02 2 years ago 2
That is not easily done.
If you held a trillion IOUs you wound not dump a half making your remain half worthless
Worse likely case is that you would curtail increases which in it self cause some devaluation/inflation but not end of the world Peter Schiff scenarios.
cosmosgato 2 years ago
Comment removed
robdev02 2 years ago
@robdev02 ??? Care to explain this? My thought was always that inflation is caused by an increase in the money supply
mazzman120 10 months ago