Printing money does not lead to inflation, argues Argentine central bank preside

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Printing money does not lead to inflation, argues Argentine central bank preside

Post by MachineGhost » Wed Apr 11, 2012 8:25 pm

The president of Argentina’s Central Bank (BCRA), Mercedes Marcó del Pont, stressed the importance of the recently approved bank’s charter reform and denied that printing currency leads to the creation of an inflationary state “since inflation is rooted in other causes”?.

http://en.mercopress.com/2012/03/26/pri ... -president
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Re: Printing money does not lead to inflation, argues Argentine central bank preside

Post by Lone Wolf » Thu Apr 12, 2012 10:20 am

If I were the head of a Central Bank whose currency was experiencing 9.7% inflation, I'd definitely want everyone to believe that "inflation is rooted in other causes".  :D
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Re: Printing money does not lead to inflation, argues Argentine central bank preside

Post by clacy » Thu Apr 12, 2012 11:30 am

There is no credibility deficit with South American Central Bankers.
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Re: Printing money does not lead to inflation, argues Argentine central bank preside

Post by Ad Orientem » Mon Apr 16, 2012 8:47 pm

The thread title alone is hysterical.
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Re: Printing money does not lead to inflation, argues Argentine central bank preside

Post by escafandro » Tue Apr 17, 2012 2:52 am

Argentina is now entering in the 4th consecutive year of inflation above 25%.
So, What this government knows about what causes inflation?
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Re: Printing money does not lead to inflation, argues Argentine central bank preside

Post by MediumTex » Tue Apr 17, 2012 9:21 am

escafandro wrote: Argentina is now entering in the 4th consecutive year of inflation above 25%.
So, What this government knows about what causes inflation?
A good rule of thumb is to assume that whatever the government says, the opposite is probably true.

The government is normally trying to cover up its latest failed policy experiment, so there is some basis for this idea of the opposite of whatever it says being the real truth.

Just take healthcare reform in the U.S. as one example--basically everything that the American people were told about this program has been almost exactly wrong.  It was supposed to reduce cost and costs increased significantly.  It was supposed to pay for itself and its cost has dramatically exceeded initial projections.  People were supposed to be able to keep their coverage if they liked it, but employers have already started to move away from the coverage they were offering pre-healthcare reform. 
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Re: Printing money does not lead to inflation, argues Argentine central bank preside

Post by moda0306 » Tue Apr 17, 2012 10:05 am

MT,

To your points on healthcare:

1) Yes, the immediate savings was a complete lie/miscalc/whathaveyou.

2) Regarding the cost of it, this is one area I felt like both sides are to-this-day claiming complete opposites.  My interpretation at this point is that the opposition to healthcare reform is trying to compare it to a base-line that assumes that medicare shortfalls in the trust fund would NOT be met with general revenue funds... or, put another way, they're trying to compare healthcare reform to huge cuts in medicare, and then saying it costs a bunch of money... but we've over and over again shown that we'll make up any shortfalls.  The view, then, is that when comparing HC reform to what would have been the likely trend, it's saving a decent chunk of money.  This is Paul Krugman's explanation of it, but I haven't seen it successfully rebutted by the other side, so I'd beinterested to hear your perspective.  (http://krugman.blogs.nytimes.com/2012/0 ... th-reform/)

3) I think employers in a recession and in general given our labor shifts would have been altering their insurance plans regardles... this is based on general impressions though, not any real detailed analysis.  I just wouldn't be too quick to blame changes in the employer-based insurance market on Obamacare.

I guess I fall into the camp that finds both public and private healthcare systems to have big potential flaws.  Evidence shows that people are simply in a horrible position to be good consumers of the most important kinds of healthcare, not to mention insurance, which tends to either act as a life-long contract or cost-deferral system for most sick people, depending on how they choose to approach the insurance market once they've developed a condition.  The comparisons to shopping for laser eye surgery on the internet are completely unlike most of the more important/dire situations people find themselves in within healthcare.  Creating a reglatory framework that makes sure insurance actually functions like insurance for people doesn't seem like a bad idea to me.
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Re: Printing money does not lead to inflation, argues Argentine central bank preside

Post by MediumTex » Tue Apr 17, 2012 11:33 am

moda0306 wrote: MT,

To your points on healthcare:

1) Yes, the immediate savings was a complete lie/miscalc/whathaveyou.

2) Regarding the cost of it, this is one area I felt like both sides are to-this-day claiming complete opposites.  My interpretation at this point is that the opposition to healthcare reform is trying to compare it to a base-line that assumes that medicare shortfalls in the trust fund would NOT be met with general revenue funds... or, put another way, they're trying to compare healthcare reform to huge cuts in medicare, and then saying it costs a bunch of money... but we've over and over again shown that we'll make up any shortfalls.  The view, then, is that when comparing HC reform to what would have been the likely trend, it's saving a decent chunk of money.  This is Paul Krugman's explanation of it, but I haven't seen it successfully rebutted by the other side, so I'd beinterested to hear your perspective.  (http://krugman.blogs.nytimes.com/2012/0 ... th-reform/)

3) I think employers in a recession and in general given our labor shifts would have been altering their insurance plans regardles... this is based on general impressions though, not any real detailed analysis.  I just wouldn't be too quick to blame changes in the employer-based insurance market on Obamacare.

I guess I fall into the camp that finds both public and private healthcare systems to have big potential flaws.  Evidence shows that people are simply in a horrible position to be good consumers of the most important kinds of healthcare, not to mention insurance, which tends to either act as a life-long contract or cost-deferral system for most sick people, depending on how they choose to approach the insurance market once they've developed a condition.  The comparisons to shopping for laser eye surgery on the internet are completely unlike most of the more important/dire situations people find themselves in within healthcare.  Creating a reglatory framework that makes sure insurance actually functions like insurance for people doesn't seem like a bad idea to me.
The larger point I am making is that ANY government action is, by definition, misguided because it is based upon the perception of what others need as interpreted by politicians and bureaucrats, as opposed to individuals in the private sector who are allocating capital based upon their perceptions of what others need.  The difference between the two is that in the private sector poor capital allocation decisions are followed by loss of one's capital (unless you are a bank), while in the public sector poor capital allocation decisions are followed by more poor capital allocation decisions as programs that don't work become revenue sink holes as their costs explode.  This happens in virtually every large governmental effort, whether it is war, eliminating poverty, improving health care, or educating children.  It is the nature of the effort itself that it will always be misguided and incapable of responding to the same capital allocation dynamics that one sees in the private sector.

The larger problem, in my view, is not so much that the government is incompetent in most spheres of activity, but rather that this incompetence is enforced through the implicit threat of violence in everything the government does.  If I don't want to buy a GM vehicle, the GM Office of Enforcement can't come to my house and put me in jail and take all my property, but it I don't want to buy Social Security coverage (just to cite one example), there is no mechanism for opting out, and any attempt to opt out is eventually met with the threat of violence and loss of freedom and property.

It's not that the private sector has all of the answers, it's the voluntary nature of private exchange relationships that make them appealing to me.  I like the idea of a service or product provider competing for my business rather than telling me that I can do business with them or be locked up.
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Re: Printing money does not lead to inflation, argues Argentine central bank preside

Post by lazyboy » Wed Apr 18, 2012 2:05 am

It seems that the reality of Private Health Care Insurance is that there is a lack of competition from the providers. They seem to be acting more like price fixing cartels. There is another aspect: living in some areas of the country leaves no choice in providers, there might be only one insurance provider. I don't have the answer, but I'm definitely leaning more toward a single payer system than the plan that was passed. Seems like the rest of the first world countries are doing OK with single payer.  
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Re: Printing money does not lead to inflation, argues Argentine central bank preside

Post by flyingpylon » Wed Apr 18, 2012 9:06 am

MediumTex wrote:It's not that the private sector has all of the answers, it's the voluntary nature of private exchange relationships that make them appealing to me.  I like the idea of a service or product provider competing for my business rather than telling me that I can do business with them or be locked up.
This is why (IMO) healthcare reform is yet another apples vs oranges debate that has little hope of getting resolved. One side is "pro healthcare" (though not necessarily against individual freedom), the other side is "pro individual freedom" (though not necessarily against healthcare for all).  Similar to those that are "pro life" vs "pro choice"... not that I want to go there, just making a point that it's another debate that will never be resolved.  Obviously there is no easy answer... I'm more in agreement with MT on this one, but I know several people that lean the other way and we drive each other nuts because we are really debating two different issues!
Last edited by flyingpylon on Wed Apr 18, 2012 9:13 am, edited 1 time in total.
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Re: Printing money does not lead to inflation, argues Argentine central bank preside

Post by MediumTex » Wed Apr 18, 2012 9:21 am

flyingpylon wrote:
MediumTex wrote:It's not that the private sector has all of the answers, it's the voluntary nature of private exchange relationships that make them appealing to me.  I like the idea of a service or product provider competing for my business rather than telling me that I can do business with them or be locked up.
This is why (IMO) healthcare reform is yet another apples vs oranges debate that has little hope of getting resolved. One side is "pro healthcare" (though not necessarily against individual freedom), the other side is "pro individual freedom" (though not necessarily against healthcare for all).  Similar to those that are "pro life" vs "pro choice"... not that I want to go there, just making a point that it's another debate that will never be resolved.  Obviously there is no easy answer... I'm more in agreement with MT on this one, but I know several people that lean the other way and we drive each other nuts because we are really debating two different issues!
A good question for people arguing the other side of the issue from the point of view I am offering is whether they believe that overall Medicare has been a success or a failure.
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Re: Printing money does not lead to inflation, argues Argentine central bank preside

Post by moda0306 » Wed Apr 18, 2012 3:47 pm

MT,

Can I assume, then, that you think medicare has been a failure?
"Men did not make the earth. It is the value of the improvements only, and not the earth itself, that is individual property. Every proprietor owes to the community a ground rent for the land which he holds."

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