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What happen on Stock market, if U.S. Gov purchase bond back?
Posted: Thu Aug 23, 2012 11:18 am
Does anyone have any suggestions?
Any help will be greatly appreciated :>
Posted: Thu Aug 23, 2012 12:41 pm
Not sure I understand your question. Do you mean what do you think what will happen when U.S. government pays down part of itÂ´s debt? (Purchase back the bonds it previously issued)
Posted: Thu Aug 23, 2012 2:23 pm
Are you asking what will happen:
1) if the .gov starts paying down their debt
2) if the FED continues (or increases) their debt purchases?
Posted: Thu Aug 23, 2012 7:57 pm
Chelonia wrote:Not sure I understand your question. Do you mean what do you think what will happen when U.S. government pays down part of itÂ´s debt? (Purchase back the bonds it previously issued)
Yes, U.S. Gov purchase back the bond it previously issued.
Does anyone have any suggestions?
Thanks everyone very much for any suggestions
Posted: Fri Aug 24, 2012 3:22 am
It would mean that there will be less money in circulation for government spending. Typically governments do not purchase back bonds they issue but just service the debt by paying the ever increasing interest over the ever increasing total debt, and/or roll into a new bond transaction at maturity under new conditions. Either way it is mayhematically impossible to pay the total debt out of only some reamining principal. The last time the U.S. payed down itÂ´s debt was when Andrew Jackson threw out the (central) bankers!
But this can be said for the whole economy in general. Money = debt (at interest) which again makes it impossible to pay back the total sum of debt out of only some remaining principal.
Let me simplify by writing down the following in order to give the answer you are looking for. Here we go.
Can you see the flaw?
The above argument simply states the premises A=B and B=C and then
makes the statement C=A+D. But if A=B=C, then
clearly A=C and C=A+D is false, unless of course D=0.
So what? You might be asking whatâ€™s the big deal? Bear with me as
you try this on for size:
Debt=Principal + Interest!
Now that is a big deal, right?
All current money contracts are centred on such flawed logic and
according to several legal doctrines, they ALL are invalid. Because
the collateral cannot be equal to both â€œPrincipalâ€
Posted: Fri Aug 24, 2012 3:29 am
obfuscation - what a great word.
Posted: Fri Aug 24, 2012 7:26 am
Chelonia, in your first paragraph you wrote "mayhematically". The letter "y" and "t" are side-by-side on my keyboard. Was this a typo or intentional?
Posted: Fri Aug 24, 2012 8:05 am
An intentional typo
Posted: Fri Aug 24, 2012 9:11 am
I agree that "interest" requires money creation which wreaks mayhem. Perhaps this was the intent of the architects of our modern money system. Perhaps it is a negative feedback loop that should restrain officials from accumulating debt and encourage balanced budgets. Why do our officials not respond to this feedback loop? My guess is that humans are comfortable with timeframes in the range of minutes/hours/days. In my opinion this feedback loop operates in a timeframe measured in years/decades.
Posted: Sat Aug 25, 2012 3:03 am
The only currency which we should be considering is mathematically perfected currencyâ€š As there is one and one only solution to inflation and deflation; to systemic manipulation of the cost or value of money or property; and to inherent, irreversible (and therefore terminal) multiplication of artificial indebtedness by interestâ€¦ thus it is only by eradicating altogether the latter costs; manipulation of the cost or value of money or property; and inflation or deflation.
The so called central banking systems The Fed, BOE, ECB, World Bank, IMF of the world in fact never earn this â€œmoney,â€