Money And Ethics And Loanable Funds.

The interest rate is the price where the supply of loanable funds equals the demand for loanable funds.

We all know that, currently, there is a scramble for loanable funds. This is another way of saying that the demand for loanable funds is high. I will briefly go into the reason for the scramble for resources.

If demand increases and the supply stays the same then the price (the interest rate in this case) will go up. These are the current conditions, where the increased demand is caused by cumulative malinvestment. But under these conditions higher interest rates will aggravate an already tenuous situation. The Federal Reserve decided on September 19th to not only maintain the price (interest rate) but to actually decrease the interest rate, even despite the increased demand for loanable funds.

The only way to accomplish this interest rate reduction is to increase the supply of money injected into the banking system. The amount of money injected is intended to not only move the supply of loanable funds outward (visualize the demand and supply curves), but to move it out so far as to intersect the demand for money, such that the interest rate will decrease!

Yesterday those loanable funds did not exist, today they do. How is that possible? Is that a miracle or an act of counterfeit? Who and/or what institution is so completely out of touch with ethics and money that it would unscrupulously practice counterfeiting? The problems that need fixed are the result of the malinvestments caused by earlier artificial injections of money into the banking system. Compounding poor ethical judgments on previous poor ethical judgments cannot be wise or just. Rather, it is unwise and unjust.

Constitutionally the Federal Reserve is illegitimate. And counterfeiting is illegal. The solution to this problem of ethics and money is clear.

Gold Meets the Criteria of Money and Ethics !!!

Here we have a blog about Money and Ethics and the most obvious link between them is gold. Despite the determined, deliberate, and diabolical efforts of the central banks and the politically compromised economists around the world to make gold appear to be obsolete what we find instead is the soundness of gold.

The volatility in world markets is because everyone is searching for real value. Most people are not aware of the pernicious nature of intervention and so they seek real value in places influenced by the interventionists, for example, real estate as influenced by low interest rates created by intervention into the credit markets.

There is no real or lasting value in these mirages created by the interventionists. But the interventionists cannot allow gold to be seen as an alternative so the politically compromised economists spout out progaganda dissing gold and the interventionists intervene in the gold market by flooding the market with gold from central bank reserves to give the impression that gold is a poorly performing investment.

These unethical practices are short term and unsustainable. Gold is ethical and it trumps the unethical practices of the interventionists. Gold is money that holds its value because it is a commodity, unlike the fiat currencies around the world which are no longer tied to anything of real value. The printing of more and more currency by central banks is illusory like a mirage and it is unethical and exposed as what it really is - mere counterfeiting.

Gold is ethical and it trumps the unethical schemes of the interventionists