Everything on this web site begins with this philosophy:
*The measure of an economy is money.
*A large
economy needs a larger supply of money than does a small
economy.
*Therefore, a growing economy needs a growing supply of money.
*All money is a form of debt.
*Therefore, a growing economy requires a growing supply of debt.
*U. S. Federal Debt is the safest, most controllable form of debt. The federal government, alone among borrowers, never will default.
*Thus, there is no
federal debt or deficit problem, and a
balanced federal budget leads to a
recession or a depression.
Read the answers in:
Please click the cover to see excerpts from FREE MONEY and for ordering information.
Rodger Malcolm Mitchell: rmmadvertising@yahoo.com
Recessions have occurred when growth in the debt/money supply was lower than it was in the previous year. Because of inflation and population increases, the debt/money supply must grow significantly, merely for the economy to remain static. With inflation at 3% and population growth at 1%, achieving 4% economic growth requires a debt money growth rate above 8% (1.03 x 1.01 x 1.04 = 1.0819). This does not take into consideration the outflow of money due to a negative current account (mostly the difference between exports and imports). A negative current account increases the need for deficit spending.
In the book,
FREE MONEY,
Rodger Malcolm Mitchell proposes solutions to the
Federal debt,
and
Federal deficit,
inflation,
recession,
depression
and
stagflation,
the
Medicare and
Social Security crises and high taxes. To see these solutions, read
FREE MONEY. for the little known, but crucial facts about the Federal Government
budget and the economy.
FREE MONEY is easy to read.
FREE MONEY is revealing.
FREE MONEY is something you and every American should understand when you are asked to pay taxes.
Read the answers in:
Please click the cover to see excerpts from FREE MONEY and for ordering information.
Rodger Malcolm Mitchell: rmmadvertising@yahoo.com
"When an author puts himself on the line by embracing an unfashionable idea, even though he is guaranteed to generate scorn or indifference, this should somehow be recognized."
Kary B. Mullis, Nobel laureate
"If at first an idea does not sound absurd, then there is no hope for it."
Albert Einstein
"Intuitional belief and popular opinion are not science. If
economics is to be respected as a science, and productively to influence our lives, it must look beyond intuition, and accept two unpopular facts illustrated in the excellent book, FREE MONEY: All money is debt, and a growing
economy requires a growing supply of money."
I. Klein, PhD
From Rodger Malcolm Mitchell: "I wrote FREE MONEY for you who enjoy thinking and discovering -- you who do not blithely accept the popular wisdom.
How can you explain the widespread belief that taking money out of an economy (with higher taxes and/or less federal spending) will help that
economy grow?
How many of these thought-provoking questions can you answer?
1. What is the tax-free national debt solution to Social Security and Medicare financial problems?
2. Why did the fastest debt growth in U.S.
history precede an economic boom and low inflation?
3. Why has every U.S.
depression come after a federal surplus, and every
recovery corresponded with a federal deficit?
4. Why will our children never have to pay for
federal deficits?
5. Where will the necessary,
added money come from to grow our economy?
6. Why are the only two
federal agencies, funded by direct tax collections, in
financial difficulty?
7. Why does the federal government not need or use
tax money to pay for goods, services or debt service?
8. What is stagflation and what is the cure for stagflation?
9. What really would happen if all
federal taxes were eliminated?
10. In just the past 25 years, federal debt has increased an
astounding 800%. Despite
"debt clocks" and dire predictions based
on popular wisdom, our grandchildren are not paying for the debt, interest rates and inflation have been controlled,
GDP keeps rising, no nation has refused to buy our debt and there is no shortage of lending funds. How is this possible?
You'll find the answers to these questions, and many more, in
FREE MONEY
How can you explain the widespread belief that taking money out of an
economy (with higher taxes and/or less federal spending) will help that economy grow?
"We cling to a long-accepted theory, just as we cling to an old suit of clothes. "New notions and new styles worry us."
Professor Asa Gray, in defending Darwin's theory of evolution.
You also may enjoy reading my discussions with members of the Concord Coalition, a group that promotes the popular wisdom. We argue about money, Social Security, Medicare, the federal debt and federal deficit. For a few samples, please click here. If you are an investor, you may gain an investment edge. You'll learn a simple, but reliable, approach to predicting the economy. You'll discover which event (and only this event) will trigger the next
recession.
If you are an economist,FREE MONEY. will give you new ideas for your own writing. This is the book owned by more than 200 of America's leading economists.
If you are a politician, you'll see concepts to help you craft laws that will grow America.
Using the
FREE MONEY formula for economic growth, I bought stocks when I predicted the economic boom of the 1980s. I sold my stocks when I predicted the
recession at the end of the Clinton administration. I again bought stocks when I predicted the recovery.
To learn what I now predict, please click here to read:
Please click the cover to see excerpts from FREE MONEY and for ordering information.
Rodger Malcolm Mitchell: rmmadvertising@yahoo.com
"Discovery begins when popular wisdom is questioned." Rodger Malcolm Mitchell
The logic behind the need for substantial debt growth:
1. A large
economy requires more money than does a small economy.
2. All forms of money actually are forms of debt.
3. Therefore a large
economy requires more debt than does a small economy.
4. Therefore, a growing
economy requires a growing supply of debt.
5. When
inflation is at 3%, the total amount of real money in the
economy will decline by 3%, unless more debt/money is created.
6. Further, when the population increases 1%, the amount of money per person decreases by 1%, unless more money is created.
7. Therefore, with
inflation at 3% and population growth at 1%, a debt/money increase of 4% is needed each year, just to break even.
8. For a GDP growth of 4% on a per-person basis, the total debt/money supply must increase at least 8%.
9. The trade deficit (more money leaving the country than entering) in 2007 was $711 billion, or above 5% of the $13 trillion GDP, which brings the per-person total debt/money (federal, state, local government plus all private debt) creation needs to nearly 14%.
History shows that when total debt does not increase enough, as happened prior to the most recent
recession, and is happening now (2008), we have slow economic growth, a
recession or a depression.
The graph compares previous year changes for inflation (red) and for total national debt (blue).
Common wisdom holds that increasing the money supply causes
inflation.
History shows that is not correct. As you can see in the above chart, there is no relationship between changes in total debt (money) and
inflation.
The value of money is determined by supply and demand. So, it is true that increasing the money supply without interest rate control would lead to
inflation, unless the demand also was increased. What increased demand? An increase in interest rates.
In short, deficit spending does not cause
inflation, because we have the power to prevent
inflation at will.
The Complete, One-Minute Course in Economics.
Click this link to learn "everything" you need to know about economics, in just one minute.
In
FREE MONEY,
you'll enjoy discussions of a
balanced Federal budget,
inflation,
stagflation,
and depression, federal taxes and tax cuts, federal debt, federal deficit, interest rates,
recessions,
money supply, Social Security reform, poverty,
"debt clocks", Social Security bankruptcy, FICA, fiscal responsibility, social security privatization,
Medicare reform,
Medicare bankruptcy, treasury bills, notes and bonds and economic forecasting. Also, see a more accurate
Glossary of economic terms. It's much more than a Glossary. It's a philosophy.
Associated Press:
"12/19/2007 WASHINGTON - Congress approved $70 billion Wednesday for military operations in Iraq and Afghanistan. The House's 272-142 vote also sent the president a $555 billion catchall spending bill that combines the war money with money for 14 Cabinet departments."
Medicare and Social Security are in financial trouble.
If you do
an internet search of the words "federal deficit," you will find
hundreds of sites warning about the federal government's debt burden. You will see
"debt clocks"
and many cautions that the Federal Debt has reached an enormous number. Stated or unstated will be the belief the federal government is living beyond its means and one day, the chickens will come home to roost, and many awful things will happen.
You will see statements of belief that increasing federal debt causes
inflation, recession or stagflation.. Yet nowhere will you
find a graph showing the true relationship between federal debt and
inflation. (There is no historical relationship.) The graph appears in Free Money.
And you will see many statements of belief that increasing federal debt causes high interest rates, which will cause a
recession. Yet, you will not see a
graph showing the true relationship between high interest rates and low GDP growth. (For reasons explained in FREE MONEY, there actually is a positive relationship between high interest rates and GDP growth). And nowhere will you find a
chart showing the true relationship between total U.S. debt growth and GDP growth (They are generally parallel).
Nor will you find an explanation of how the U.S. government, with the unlimited power to print money, ever can have difficulty paying its debts.
In short, you will see sites that are long on belief and short on facts. That is why
economics has become more like a religion than a science. Belief and faith dominate fact. Economists immerse themselves in minutia, like clerics debating abstruse phrases of religious dogma.
The doomsayers remind one of the cult leaders who each year take their followers to the mountaintop, to await the end of the world. But the world fails to end. Does that discourage the doomsayers?
Apparently not, for they keep chanting the same economic warnings, over and again, while the federal debt and the economy continue to grow and fall in tandem. We never again will have
inflation,
recession,
depression or
stagflation if we keep interest rates and the federal deficit high.
Associated Press: Jan 13, 2008
Lawrence Summers, one of President Clinton's treasury secretaries, said the odds of a
recession, this year went up after the dismal employment report. He advocates temporary tax cuts and emergency spending.
In 1997, the Chicago Tribune newspaper published an editorial headlined, "Clinton, GOP hail budget, tax deal . . .
would yield the first balanced budget since 1969" Chicago
Tribune, May 3, 1997."
I predicted this much-applauded act would cause a
recession if we were lucky and a depression if we were not. We were lucky. We had the recession.
If we were not so "lucky," and the surplus had lasted longer, this is what might have happened: 1817-1821:
U. S. Federal Debt reduced 29%. Depression began 1819.
1823-1836:
U. S. Federal Debt reduced 99%. Depression began 1837.
1852-1857:
U. S. Federal Debt reduced 59%. Depression began 1857.
1867-1873: U. S. Federal Debt reduced 27%. Depression began 1873.
1880-1893:
U. S. Federal Debt reduced 57%. Depression began 1893.
1920-1930:
U. S. Federal Debt reduced 36%. Depression began 1929.
1998-2001: U. S. Federal Debt reduced 9%. Recession began 2001
Please click the cover to see excerpts from FREE MONEY and for ordering information.
