Personal View site logo
Make sure to join PV on Telegram or Facebook! Perfect to keep up with community on your smartphone.
The Broken Window Fallacy
  • Vitaliy_KiselevVitaliy_Kiselev

    Thing that this video get wrong is that goverment is partly right in their measures.
    Why? Because you need to take into account globalization.
    So, if you introduce taxes, get this money and spend it on war and construction you can be in surplus.
    As you have problems controlling money spend by citizens (on Chinese and other countries goods).
    But you can be good at controlling contracts to be sure that they stay inside.

    This is ideal situation, of course.

  • 20 Replies sorted by
  • chazzmoechazzmoe

    I agree sort of, but you assume that where the money goes it stays. Ideally the country that exports its money would produce goods that other countries would want as well and would buy those goods with the same money that was imported creating even trade. It isn't working like that right now because America doesn't make goods, it just exports paper money. And so far Chinese haven't figured out it just runs off the printing press yet.

  • Vitaliy_KiselevVitaliy_Kiselev

    @chazzmoe

    In fact, America right now is exporting enough knowledge and have enough army and influence to make countries forget about paper (it is more like electrons, not paper).

  • chazzmoechazzmoe

    Im not sure I follow you all the way? Your saying we use war to keep the dollar the reserve currency?

  • Vitaliy_KiselevVitaliy_Kiselev

    @chazzmoe

    I suggest you to read my words. :-)

    Your saying we use war to keep the dollar the reserve currency?

    At least history states that you used war to make dollar reserve currency :-)

  • chazzmoechazzmoe

    I agree, I'm not a big fan of policing the world. The US dollar was the reserve currency because Of the bretton woods agreement. The founding fathers of the United States were very wise men. They were not interventionist and didn't believe in getting involved in foreign affairs. We have gotten away from our roots. They had everything perfect besides slavery, but nobodies perfect! They actually didn't want slavery but it was the only way to get some of the states to sign on. Check out a man named "Peter Schiff" he's an economist who predicted the global economic meltdown. At first I didnt like all that he said but if you think it all the way through it makes a lot of sense. PS. Thanks for your Hack, it's amazing, can't get over how creative you guys all are!

  • chazzmoechazzmoe

  • brianlucebrianluce

    How are we supposed to get roads and rail to improve efficiency and commerce if the government won't do it? Magic carpets? Also, this video has some incredibly bad attempts at foreign accents.

  • chazzmoechazzmoe

    Lol at the government needing to take 30-45% of Every workers pay to have roads and warren buffet bought the rail so no worries there. The taxes on gas is supposed to pay for roads but now it gets used for other things too.

  • brianlucebrianluce

    Warren Buffet does not own the American rail system.

  • csynccsync

    man, peter schiff is kind of a hack. any financial guru who consistently loses money for his clients should be a laughing stock pretty quickly, and he is. he's hardly a real economist.

  • chazzmoechazzmoe

    You guys are drinking the Kool-Aid too much, I can't help you guys. Your eyes are closed to reality. That's all I got to say.

  • csynccsync

    @chazzmoe - it's always concerning to read about someone who claims to have their own essential view of the world which no one else can verify and the only claims that are made successfully are ones that are interpreted after the fact. why is it concerning? because then no real conversation can occur because the other participant has already constructed their reality a priori.

    this is a guy who writes a book about investing your money in foreign stocks because the dollar is going to go down, then states it's too complicated to invest in foreign stocks so you should really find an expert (like the author of the book) to invest with. and then the investments he takes in lose around half their value because he invests the money poorly and his predictions aren't correct.

    if you're interested in the economics, read this article.

    @vitaliy_kiselev - what that video doesn't account for is what if instead of breaking something that was already functional (like a window) you build something new that has productive usefulness? that's essentially what public works are, and they're way better at stimulating economic growth than a lot of other tools in the kit, such as a broad tax cut (which often is just used to pay down debts, or saved). maybe tax cuts are good for other reasons (and certainly they are), but there's certainly a usefulness in having that tool available (aren't roads nice to have?).

  • chazzmoechazzmoe

    @ csync just because something hasn't happened yet doesn't mean it's wrong. Also your stimulus theory is flawed. The government isn't productive by its very definition. It doesn't produce anything without taking from others. It has to take from someone first before it can "stimulate". Either through raising taxes or printing money which causes inflation which people pay for with higher food/energy prices. If stimulus is good, why not just print up billions for every person in the world and solve world hunger etc. it doesn't work that way. Fiat paper money is just a medium of exchange.

  • Vitaliy_KiselevVitaliy_Kiselev

    It has to take from someone first before it can "stimulate". Either through raising taxes or printing money which causes inflation which people pay for with higher food/energy prices.

    If it had been truth any development had been impossible, same for monetary base increases without exact same inflation. So, it is wrong and flawed view.

    Btw, it is most common for so called Austrian school (zerohedge fanboys are good example).

  • chazzmoechazzmoe

    @VK

    Do you think we are heading for deflation or inflation? Globally speaking.

  • chazzmoechazzmoe

    I like Austrian school! Makes the most sense! :)

  • Vitaliy_KiselevVitaliy_Kiselev

    I like Austrian school! Makes the most sense! :)

    In this case you just need to read more and look at practical economics :-)
    Austrian guys resurge always during recessions with their "wise" thoughs (always the same).

    Do you think we are heading for deflation or inflation? Globally speaking.

    It depends. On that methods world rulers will use during this attempt to establish new totalilarian global rules.
    Despite extremely big problems they are big only if you look at one local country. They are also big in the eyes of average Joe. Problem is that specific countries and Joes are no more interesting for global elite.

  • chazzmoechazzmoe

    I'm glad I'm am poor, I don't have to worry about economy too much! I agree on the totalitarian global rules, will probably be implemented through the guise of "security" and people will willingly except it. No good outcome either way. World leaders are excited for more war it seems. Anyway thanks for the chat my friend.

  • BenibubeBenibube

    there will be 10 milliards (billions) of world population very soon, in a dramatic changing world......without enough water and food....???

  • liquidifyliquidify

    U.S. currency is already on the way out as the reserve currency. The recent BRIC conference was done for the sole purpose of establishing a method to remove the dollar as the reserve currency. They accomplished this purpose. The Austrian mentality pops up during recessions because its when the populous is reminded of what a artificially stimulated currency can do in the bad times. Austrian may move society forward slightly slower during the boom times, but there is far more consistency over time. Also has benefits of promoting savings and strengthening currencies.

    The military won't be able to keep the dollar as reserve currency this time because the American people don't want war.

Add a Comment