News & Analysis
DB Briefs: Government Knows Best / Thai Rice Causes Inflation? / The Federal Reserve Is Necessary?
AT&T Purchase of T-Mobile May Spur Regulation
AT&T's pursuit of U.S. government approval for its $39 billion planned purchase of T-Mobile USA Inc. may spur more regulation for the entire telecommunications industry. ... "Once you have a monopoly, you have pricing power, you need rules," Howe, the report's co-author, said in an interview. Without more regulation, "your choice is lawlessness." – Bloomberg
Dominant Social Theme: Without government regulation, the public would be helpless victims of monopoly businesses.
Free-market Analysis: In a truly free market, monopolies are fragile and fleeting, and they never have the license to gouge that the Justice Department would have you believe.
A monopoly is constrained by indirect competition from substitutable products and services. Mobile phones face competition from landlines, VOIP (internet phone service) and computer email, which means that all internet providers and channels (including satellite) are part of the competitive mix.
A monopoly is constrained by the threat of new entrants. Any monopoly that set its price substantially above its marginal cost for providing the product or service would be inviting fresh, competitive faces into its industry seeking a share of the extraordinary profits. Their arrival would be the beginning of the end for the monopoly.
There's only one monopoly that is free of these constraints. It is the monopoly provider of violence and coercion, aka the government.
Asia Inflation May Rise With Thai Rice Price
Yingluck Shinawatra became Thailand's first female prime minister by pledging to lift rural incomes through higher rice prices. The rest of Asia may now have to pay for her campaign promise. ... "High rice prices will translate into higher inflation pressures in Asia, at a time when most inflation readings are flirting near the higher end of central-bank target or forecast ranges," said Chua Hak Bin, a Singapore-based economist at Bank of America Merrill Lynch. "Once the global backdrop stabilizes, inflation could come back strongly." ... Food makes up more than 30 percent of inflation indexes on average in Asia. – Bloomberg
Dominant Social Theme: Rising prices cause inflation.
Free-Market Analysis: No, it doesn't work that way.
Let's start with the rice. The Thai government will purchase rice from farmers at a high price. So farmers will grow more rice, perhaps much more. Thailand is already a big rice exporter, and it is about to boost its export volume with all the extra rice that will come with subsidized price paid to farmers. But to export more rice, the Thai government will have to accept a lower price, i.e., consumers in other countries will be paying less. The bottom line is: good news for Thai rice farmers; very bad news for Thai taxpayers. Good news for rice eaters everywhere.
But even if the subsidy to Thai rice farmers did somehow raise the price to Asian consumers, it would not raise the general level of prices; that is, it would not cause price inflation. The general level of prices would be unmoved because if consumers are spending more for rice they must be spending less on other things, which would put downward pressure on the prices of those other things.
There is only one reliable cause of price inflation -- the production of new money. It is only an increase in the money supply (such as what most central banks accomplish daily) that enables the public to spend more on everything. No new money, no price inflation -- no matter what wasteful policy the Thai government adopts to attract votes from rice farmers.
In Rick Perry's World Without a Fed, He Can Barter for U.S. Votes
Asked about the Federal Reserve...[Texas Governor Rick] Perry said of Fed Chairman Ben S. Bernanke: "If this guy prints more money between now and the election, I don't know what you all would do to him in Iowa, but we would treat him pretty ugly down in Texas. Printing more money to play politics at this particular time in American history is almost treacherous -- or treasonous." ... If he believes this, he either doesn't understand the Fed's function, or is a peculiar kind of monetary extremist. ... If the Fed didn't print any more money at all, we'd soon be relying on a cumbersome and rather inexact form of exchange known as the barter system. – Bloomberg
Dominant Social Theme: Only a dolt thinks we could get by without the Federal Reserve.
Free-Market Analysis: The Federal Reserve began in 1913. American prosperity and economic growth began much earlier, in 1623, when Plymouth Colony abandoned communal ownership and production in favor of private property and a free market.
Since the arrival of the Federal Reserve, the U.S. has suffered its worst round of bank failures (three seizures, from 1931 to 1933), the Great Depression of the 1930s, the Great Inflation that began in 1971 (which has reduced the value of a dollar by 90%) and now the Great Recession. Not quite an indispensible institution.
The notion that without continued money creation we would revert to barter is a howler. The U.S. has had periods of a stable money supply or even a slowing shrinking money supply, such as the years between the end of the Civil War and the 1896 discovery of gold in the Klondike. Barter did not reappear, but the general level of price did tend to decline.
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Posted by robert wheeless on 08/18/11 04:39 PM
If you trust Rick Perry you might as well give up the ghost.
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Posted by sandy on 08/18/11 02:42 AM
Hey : )
Off-Topi. TheEdgeMedia ,on SKY2oo(controversial TV) ,-had a great 9/11 show last-nite(it's often repeated) : 'CaptainSherlock investigates 9/11'.
WOW . And they have 20plus 'Police' barrelling(& being cheered for!!)into Londoners' sanctuary's to retrieve pair's of Trainers.
Thank's for 'DB'.
Just try & raise these issues in the MSN (do'nt-hold-your-breath-though-of course!).
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Posted by sandy on 08/18/11 02:41 AM
Hey : )
Off-Topi. TheEdgeMedia ,on SKY2oo(controversial TV) ,-had a great 9/11 show last-nite(it's often repeated) : 'CaptainSherlock investigates 9/11'.
WOW . And they have 20plus 'Police' barrelling(& being cheered for!!)into Londoners' sanctuary's to retrieve pair's of Trainers.
Thank's for 'DB'.
Just try & raise these issues in the MSN (do'nt-hold-your-breath-though-of course!).
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Posted by johnblenkins on 08/17/11 07:59 PM
This from a major English High Street Bookie.
On the Republican Presidential Candidate.
Despite a MSM blackout on Ron Paul.
11/8
Rick Perry
2/1
Mitt Romney
4/1
Michele Bachmann
7/1
Ron Paul
14/1
Jon Huntsman
20/1
Sarah Palin
28/1
Rudy Giuliani
28/1
Herman Cain
40/1
Newt Gingrich
40/1
Mike Pence
50/1
Rick Santorum
50/1
Marco Rubio
80/1
Jeb Bush
He is only 16/1 for President. Obama is 8/11 favourite.
Bush must of been 9/11. Lol.
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Posted by Zenbillionaire on 08/17/11 07:14 PM
"People worry about Ron Paul's safety if he gets too popular. I worry more about a false-flag attack or even outright war."
This is the real reason the media say Ron Paul is unelectable. It isn't a prediction and it isn't an observation of public sentiment. It's a promise.
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Posted by bob on 08/17/11 07:09 PM
Indeed, Ron Paul can't win. This is a sad truth. This is the reality. Either election results will be manipulated or he might be in a harm situation.
In today Russia and many other places a not-officially approved candidate cannot even be a candidate. They just will put one in jail for violating "their election rules".
Nevertheless, Ron Paul deserves a huge credit for using a high podium to educate people and open their eyes. Furthermore, the organized campaign by the big media to "ignore" him will inadvertently backfire by removing whatever credibility the mainstream media still have.
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Posted by bob on 08/17/11 06:00 PM
The best quote from ZeroHedge: "Any system allowing a group of people who don't work to vote how much money to tax away from those who do is instantly idiocy."
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Posted by clark on 08/17/11 05:29 PM
First they ignore you.
Then they fight you.
Then you win.
The theme of the day is, "Ron Paul can't win" - I'd call that the beginnings of openly fighting the ideas of liberty.
On a number of websites People sure are putting down Katherine Mangu-Ward of Koch supported Reason Magazine for saying on TV that, "Ron Paul is never going to be President":
Click to view link
Also, here's another link about Rick Perry, the actor and master of many disguises:
Ricky the Rent Boy
"Perry is a cunningly coiffed Keynesian chameleon,..."
Click to view link
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Posted by John Danforth on 08/17/11 04:37 PM
Dotti,
Ronald Reagan got the same treatment. Called a radical, a loon, too old, and so on. It backfired on the media.
Don't expect the MSM to alter course until they look up and discover nobody is following them. They push their version of the truth, then take a poll to see if it is catching on, then if it is, they blabber about the poll on the assumption that most people will figure if everyone else thinks that way, they should, too.
They were not able to shut us up the last time. A lot of people who never did anything political in their lives 'woke up'. A lot of people have been waking up ever since. This time it will be a lot bigger.
Nobody can win in a debate with Ron Paul. Notice that they are stuck with the last argument -- he "can't win". It's their mantra. "We won't cover him because he can't win." Trying to make it a self-fulfilling prophecy. When he does get mention, it's mainly to gripe about his supporters deluging their phones and email boxes berating them for trying to silence the freedom message. This thing won't be stopped. It's about freedom. The only alternative to freedom is coercion under threat of physical harm. People are growing angry about that. They are discovering that they have been lied to their entire lives. It's a big adjustment to make. The press is actually helping us. By sticking to their guns when their ploy is so obvious, they grant credibility to us.
It's like the glasses in the movie They Live.
Click to view link
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Posted by Col on 08/17/11 03:26 PM
Nahahaha!
why am I not surprised!?
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Posted by FredMitchellJr on 08/17/11 03:20 PM
Avatar,
Can you prove the Bilderbergs discussed a Ron Paul assassination in 2008? It's not like I find that unbelievable. The international bankers have a Satanic legacy.
Fred
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Posted by FredMitchellJr on 08/17/11 03:07 PM
dave,
Decriminalization of pot was the point I wanted to make. You are right. "shall be legal" is too binding on local governments.
Fred
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Posted by Hugh on 08/17/11 03:00 PM
A platform that makes too much sense and will not escape the radar of the MSM who will signal the degree of their fear to Mr Paul's message by the level of lunacy they attach to it.
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Posted by Dave Jr on 08/17/11 02:59 PM
"What would be wrong with passing a law that says selling and consuming products containing cannibis shall be legal in the United States. Local communities could make their own laws penalizing it."
If the fed were to pass a law saying "shall be legal", then the state and local government hand would be tied to do anything against it.
Better to decriminalize it at the Fed level and let the local governments make their own laws. Local gov feels the heat from the people directly and can make their own decisions. If pot users don't like the local law, they can move to a more permissive community even if it isn't a pleasent place to live. Again, their choice.
Reply from The Daily Bell
Drug laws should be a function of state rather than federal legislation.
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Posted by Hugh on 08/17/11 02:52 PM
There is no disputing the fact that Rick Perry was an attendee to Bilderburg in 2007 Click to view link and therefore was in violation of the Logan Act. Why does he get a pass?
Nevermind, how foolish of me to ask.
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Posted by FredMitchellJr on 08/17/11 02:28 PM
Whatever you do, don't fail to watch Alex Jones' August 16, 2011, video. (Click to view link
Instead of ignoring Ron Paul, why don't we have an adult conversation about the presumed 'nutty' parts of his platform? He has had more time to think about these issues than you or I. Doesn't he deserve serious consideration on them? Not all Libertarians are pot-heads. Here are a few of Paul's talking points:
1. The roots of War (as understood by G. Edward Griffin), and the insanity of 'popular wars' and 'international alliances' for which we foot the bill.
2. Close the Fed, after the currency replacement problem is rationally settled.
3. Decriminalize pot.
The War on Drugs is still going on in spite of its obvious futility. Did we learn nothing from Prohibition? Did anyone seriously believe that drug use could be regulated down to nothing by arresting and imprisoning the makers and sellers of drugs?
The resolution of Prohibition (21st Amendment, 1933) was a less-than-perfect solution: taxes on alcohol, and state-run liquor stores. But it took the gangsters out of the alcohol business. Now it is not illegal to make beer or whiskey, but you can be jailed for not paying the tax on it.
Now, in some states, pot can be purchased as medicinal cannibis from state licensed stores. Certainly this is a start to take the business away from gangsters. Unfortunately, the gangsters are still smarter and more ruthless than the 'Revenuers.' Where is our Eliot Ness? Could Ness have survived our present IRS? He would certainly have been a misfit in our Justice Department.
What would be wrong with passing a law that says selling and consuming products containing cannibis shall be legal in the United States. Local communities could make their own laws penalizing it. But they would have to tax their constituents heavily to pay for the penal institutions to house these (mostly) non-violent miscreants.
I know many good Christians, responsible people who are horrified at the suggestion of 'legalizing drugs.' Some of them are heavily involved with Chuck Colson's prison ministries. The high percentage of our population behind bars does not seem to concern them. But they would put their own grand children in the slammer for smoking pot. On this issue they are in complete agreement with our fellow citizens who administer the penal system.
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Posted by dotti on 08/17/11 02:08 PM
Re: "If Ron Paul gets the nomination, he will win in a landslide."
John, Are you serious? Will the MSM come over from the Dark Side, or just fail in their attempts to make him seem ridiculous? Will he avoid meeting with some "accident" or assassination?
I would love to see that happen. It would not mean that the battle was over, but would show that some of our fellow citizens are seeing the light.
BTW, I saw a commentator on CNBC who said that of the 6 budget plans presented during the debt crisis, 5 would balance the budget in 5 years--only Obama's would not. He seemed credible and no one challenged him--even when he repeated it. I never heard that said during the battle. Is it true?
Thanks.
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Posted by John Danforth on 08/17/11 01:54 PM
Dotti,
If Newt says it, I have no reason to disbelieve him. That's not to say he isn't an avowed NWO globalist. I will never, ever trust any politician who stays silent about the puppet-strings of counterfeit money. That issue trumps just about everything else. There is no way they can exist without at least hearing about the issue. So if they won't talk about it, they support it. That's enough for me right there.
If Ron Paul gets the nomination, he will win in a landslide.
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Posted by dotti on 08/17/11 01:10 PM
John, went to the link.
man. I hate that. I had thought that Perry may be a good Republican candidate.
I continue to be concerned that Ron Paul will be allowed to win the nomination--with the idea that he cannot beat a Democrat--either Obama or Clinton.
I was amazed, however, to watch a program, I believe it was Kudlow--where everyone was talking about Michelle Bachman getting 29% of the straw vote. All talk was about her and Mitt Romney. I never heard even one word about Ron Paul, although the text on the screen showed Ron Paul at 28%. It was eerie!
Do you think that Newt Gingrich is being truthful saying he's not involved with Bilderbergers?
thanks for your posts. Very informative and thought provoking.
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Posted by John Danforth on 08/17/11 12:49 PM
The Bilderbergers apparently trust him. He's their own hand-picked boy.
Click to view link
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