Who condemns the existence of monopolies on extortion?

There are two subthreads here involving me, first with John C. and the second with Ralph B. (and Chris M.)

For the past 25 years or so, I get a strong sense of what the new year will bring right at sunset on Dec 31. Call me crazy, but this year it’s a feeling of “discontinuity.” For those of us in the business world, that’s a great word (like “disruption”). Brings up images of innovation and shifting the environment in which problems arise. And disruption can be scary–black swan events like uprisings, natural disasters, and shifting borders of countries, ideas, tribes of people. Anyone have a similiar feeling? Is 2016 the year of discontinuity?

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John Canida
John CanidaI believe we are starting to get that we need to stop bombing each other…. Muslims are finally speaking out to create whats possible for their religion. “They” are stepping up to take back their religion. We cant fix whats wrong in the world but we can create the light..
J R Fibonacci Hunn
J R Fibonacci Hunn John, (in reply to your comment)… Have you ever considered (lately…) that there may be nothing inherently wrong with the world (except in the perception of those who are organized around finding something to heroically fix or prevent)? If I passionately condemn something, such as bombing, does that correspond first to recognizing the possible relevance to me of that pattern of activity and then second to calmly and curiously studying that aspect of reality… Or would passionate condemnation correspond to turning my attention away from direct observation of that reality which I condemn? Do I make breakthroughs or rackets and upsets?

where there is terror and panic and denial, then condemnation (making wrong) is likely to arise as well as glorification (making right). Glorification may also be a way of actually turning away from simple direct alertness to the thing glorified.

John Canida
John Canida JR… You are way smarter than me … I have no ideal what your talking about.

J R Fibonacci Hunn
J R Fibonacci Hunn The verbal creation of “there is something wrong out there with the world” is one common way of relating to what I experience. That way of relating could be called a way of resisting or invalidating some portion of what I experience.

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Chris McArdle
Chris McArdleI’m surprised by this post, Dave – ‘black swan’ events are a myth. ‘discontinuity’ assumes that continuity the fundamental reality. it’s something like the opposite… ‘black swan’ depends on projecting or placing the past into the future.
Ralph Benko
Ralph BenkoGreat insights as always, Dave Logan. I have a Forbes.comcolumn composed and in the pipeline addressing this very matter, drawing on James Piereson’s new book Shattered Consensus, which makes the point, drawing on work by the late Mancur Olson, that affluence tends to breed parasites (both corporate and governmental), although he uses the more polite term “rent-seekers” … which leads to stagnation and thus either to a kind of economic cannibalism or to disruption. Be great to hear your views if it proves worth your attention. Kind regards, Ralph Benko

Forbes is a global media company, focusing on business, investing, technology, entrepreneurship,…
FORBES.COM
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Chris McArdle
Chris McArdleRalph – I’m reading your column on Steve Forbes and Ames, and I cannot follow your reasoning. Why would health care economics follow the fundamentally different economics of consumer electronics? It makes no sense whatsoever.

Proceeding to your defense of Ted Cruz, I’m utterly baffled. Setting everything else aside, – a gold standard? This is just a ridiculous proposal – even Hayekians, among whom you count yourself, don’t actually stick with this argument. It’s utterly uncredible.

So I ask you what, exactly, are the “great insights” of Dave‘s OP with which you find yourself enamored?

Like · Reply · 1 · 17 hrs · Edited
Ralph Benko
Ralph BenkoHi Chris. Sorry you were unable to follow my reasoning on Steve Forbes’s book. Now, let’s go for the money shot. There are legitimate grounds for debate about the gold standard (Hayek himself, in a way that I am not, was opposed to the classical goldSee More

CNN, Larry Summers, and Paul Krugman.…
THEPULSE2016.COM|BY RALPH BENKO
Like · Reply · 1 · 17 hrs
Chris McArdle
Chris McArdleI was referring to that very article, Ralph. To wit:
“The gold standard also is an economically sound proposition… ‘Let us not forget either the tremendous disaster of the Great Depression, carrying in its wake countless sufferings and wide-spread ruin, a catastrophe that was brought under control only in 1934, when President Roosevelt, after a complex mix of remedies had proved unavailing, raised the price of gold from $20 to $35 an ounce.’

This is historically false, Ralph; utter nonsense. The fact is that Roosevelt took the US off the gold standard in 1933:
http://www.history.com/…/fdr-takes-united-states-off…

Like · Reply · 1 · 17 hrs · Edited
Chris McArdle
Chris McArdleAnd you didn’t answer my question as to what, specifically, insights in Dave‘s post that you found great.
Like · Reply · 1 · 17 hrs
Ralph Benko
Ralph BenkoChris, was hoping that my linked column on Dave would have covered that to your satisfaction…. Ars longa, vita brevis…..
Unlike · Reply · 1 · 16 hrs
Ralph Benko
Ralph BenkoChris McArdle, FDR revalued the dollar to a $35/oz parity point rather than $20.67 under the guidance of great commodities economist George Warren. That is not at all equivalent to taking the US off the gold standard… notwithstanding some casual but ill-grounded statements by FDR at the time….. (FDR was mist astute to follow George Warren’s advice but the historical recordis not at all clear he understood the underpinnings.) This is not historically false, to which Liaquat Ahamed’s Pulitzer Prize winning Lords of Finance more than adequately attests….. Kind regards,,,,
Unlike · Reply · 2 · 16 hrs
Chris McArdle
Chris McArdlereally, Ralph, you’re persuading nobody with this flourish.
your endorsement of Ted Cruz and the gold standard is disqualifying and, you still did not address my direct question with respect to your fawning, insubstantial compliment addressed to Dave.
Ralph Benko
Ralph BenkoThank you, Chris. I’ve not persuaded you, that’s clear, but perhaps you are not qualified to say I’ve persuaded “nobody.” That said it is not clear that my work is “disqualifying.” I have published well over half a million words both in the mainstream media over the past several years and in blogs on the gold standard, atthegoldstandardnow.org and at ThePulse2016.com, as well as elsewhere, with several million page views. Who know how many have been persuaded, or not? Certainly not me, or, it respectfully is submitted, you. There really isn’t room here, or the justification, to reprise those hundreds of thousands of meticulously-sourced words here on Facebook. That said if you’re interested (and you fully would be justified if not) do feel free to dig in to the larger discourse. Kind regards and happy trails. Farewell.

Unlike · Reply · 2 · 15 hrs
Chris McArdle
Chris McArdleNot qualified, Ralph? I am as qualified as you are. Half a million words in support of the wrong argument are not worth the pixels it takes to display them.

You may, or may not, reprise whatever you like. False premise = false conclusion. Not complicated.

Unlike · Reply · 1 · 14 hrs
J R Fibonacci Hunn
J R Fibonacci HunnThis seems to be a rather unusual sub thread. As for one point of fact, I would not say that FDR personally revalued the dollar. On January 30, 1934, yes, FDR signed an act of congress which devalued the US Dollar by 41%, but it was not like it was just an executive order.

http://www.federalreservehistory.org/Events/DetailView/13

J R Fibonacci Hunn
J R Fibonacci HunnThe relevant executive order (which was ruled partially invalid in a later Supreme Court case) was in 1933, and I include a photograph of that order in this article:

Http://az-az-az.com/1/1.php

J R Fibonacci Hunn
J R Fibonacci HunnFurther, I consider The promotion of metal standards for Currency to be based largely on delusion. For instance, a penny minted in 1980 not long ago reached a melt value of 1.7 cents in copper. The melt value of all other US coins is significantly below the face value. The idea that the melt value should be close to the face value is based (I boldly propose to Ralph) on a complete misunderstanding of government Currency systems, which I will briefly summarize below.
J R Fibonacci Hunn
J R Fibonacci HunnWhat is the one and only source of public demand for all Government currencies as well as for the modern fiat currencies issued by private banks such as that of the Federal Reserve Bank? I assert that the source of demand for a currency by the public is the power of a government to invent debts owed to them, also known as taxation as well as the invention of criminal fines. Once they invent a debt, then they can dictate what form of payment they will accept to pay off the debt they invented. That creates public demand for whatever form of payment they agree to accept.

(The more debts that they invent, the bigger the public demand for whatever forms of payments they declare to be valid.)

J R Fibonacci Hunn
J R Fibonacci HunnIn the 2nd link above, as noted already, I show an image of an executive order from 1933. That was the order which (allegedly) criminalized possession of gold by US citizens and then stipulated a fine in the amount of what is now approximately $185,000 for any violation of that unilateral executive order of FDR. By personally inventing a criminal fine like that, and without any change to the supply of Currency, that obviously will increase public demand for currency, at least amongst those who are charged with that fine.
J R Fibonacci Hunn
J R Fibonacci HunnSimilarly, what happens when the rate of taxation for sales taxes or payroll taxes or income taxes is raised without any change to the volume of currency? Of course, that increases demand for Currency which increases purchasing power, reducing all prices. In contrast, when tax rates are lowered far enough with no change in the supply of currency, what naturally happens to public demand for the Currency?
J R Fibonacci Hunn
J R Fibonacci HunnAlso, as happened in 1933, if one form of legal currency is suddenly criminalized, what happens to public demand for it (at least for the sector of the public for whom possession of that currency is suddenly a major felony, which in the 1933 example was all US Citizens, with foreigners still allowed to legally possess the criminalized currency)? It is no surprise that demand drops once possession of the currency is criminalized, right?
J R Fibonacci Hunn
J R Fibonacci HunnRulers get to invent debts owed to them and then get to specify what form of currency can be used to repay the invented debts. That coercive Monopoly power is the source of all public demand for all modern currencies. The fact that the melt value of an old Penny reached almost 2 cents is entirely trivial. It is worth whatever the ruler says that it is worse because they have the military capacity to enforce their declarations of value.
J R Fibonacci Hunn
J R Fibonacci HunnThey declare debts into being. They declare currencies into being.

Through words, the oathsworn high priests perform rituals for the creation of debts and for the creation of public demand for the sacred object of that system of governing human activity and human perception (with that sacred object being used to discharge the debts that they declare or invent or create).

However it is not magic shapes of ink on paper that give a currency value. It is the military capacity behind those declarations of value. It is the ability and willingness to arrest and imprison and garnish and Levy and seize and auction.

J R Fibonacci Hunn
J R Fibonacci HunnI was rereading my comments and added the word allegedly a few comments back. The issue was that FDR declared a crime in to being but that was challenged and the Supreme Court ruled that he did not have the authority to declare that particular crime inSee More
J R Fibonacci Hunn
J R Fibonacci HunnI am tagging in John Mihelic, Carl Freestone, andJames Levreau because above I present the same simple proposal that I so often have presented. I detail how some people “declare in to being” debts and currencies and I also state how they “take a stand” for their declarations through the use of organized military force.
Chris McArdle
Chris McArdleI wouldn’t place as much emphasis on the use of military force, although that is at the source of the value of currency. I’d emphasize the fact of its status as legal tender in the legal framework necessary for a modern economy to operate. and mention that the government “declaring in to being” a currency is pretty much the definition of “fiat” currency. That said, I largely agree with you, J R.
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J R Fibonacci Hunn
J R Fibonacci HunnChris, if you look up the word law in a legal dictionary, you might be surprised to find law being defined as the organized use of force / coercion.
J R Fibonacci Hunn
J R Fibonacci HunnWhen the US invaded Mexico (resulting in the transfer of 1/3 of mexico to the US), there was a shift as to whom the locals of those regions would pay taxes to. A new ruling priesthood defined what would be “legal tender” for them, such as pesos or francs or euros or the US national currency or the Federal Reserve Notes of a private banking “cartel.”
J R Fibonacci Hunn
J R Fibonacci HunnFiat or otherwise, all currencies are declared in to being. Other “stores of value” are not currency. Also, something like Bitcoin would be at most a pseudo-currency until some court system of violence demanded payment in the form of Bitcoin units.
J R Fibonacci Hunn
J R Fibonacci HunnWhen a ruling priesthood creates a monopoly on access to a substance, such as gold or diamonds or even sea salt, that monopoly is important. The priesthood places an army around the mines and then has some slaves / laborers extract some rare substance.

Then, the priesthood declares that substance as the only one accepted for the debts that they invent. That declaration creates demand in the public. If there was already some demand in the general public for some generally useless chunk of rock, then public demand rockets (at least in the vicinity of that priesthood’s System of extortion).

J R Fibonacci Hunn
J R Fibonacci HunnThe priesthood could define the exchange rate for their sacred object however they like. Imagine that they pay each laborer 20 pounds of wheat for each ounce of gold that the laborer delivers to the mining supervisor. Why do they pay in wheat? Because the Labors eat it and can even barter with it.

Then, the priesthood declares that each ounce of gold once it has been ritually minted with the face of one of the local gods, is suddenly worth 100 pounds of wheat or 1000 pounds of wheat (depending on what numbers the priests mark on that particular coin).

J R Fibonacci Hunn
J R Fibonacci HunnThe whole value of currency is to advance a ruling system of extortion from just being a protection racket into being a system of “marginal mark-ups.”
J R Fibonacci Hunn
J R Fibonacci HunnAnd the tax collectors go to the public and assess the debt by the public to the ruling priesthood and then say you must now buy one of our sacred objects from us in order to pay your debt so we don’t arrest you and confiscate your property or kill your family or whatever the threat is. Then the tax collector announces how many pounds of wheat Will be needed in order for the taxpayer to buy the public currency which the tax collector well then take away anyway (as the payment of the invented tax).
J R Fibonacci Hunn
J R Fibonacci HunnThe historical issue with tax collectors is that they would make their assessments in and irregular fashion that invited corruption. If we recognize the behavior of piracy or extortion as being on the same spectrum as taxation, then these observations are plain and obvious.
J R Fibonacci Hunn
J R Fibonacci HunnOne biblical issue was that people confused the calf made of gold as having some inherent value. It was never the gold itself or the beautiful art of the statue that was important. It was the social system of coercion behind that symbolic gold calf. When people focus too much on the substance and not enough on the system that manipulates demand for the substance, that is “missing the mark” (imprecise, sinful). Note that the ancient Greek word that is translated into English as sin literally means to miss the mark or what we now call “missing the point.”
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