So after counting up how much money I have right now

I doubt it's identical but that's the general idea, yeah. It's way more of a hassle if your debit card details are stolen, as opposed to credit cards. I usually try to use Paypal for online purchases.

 

my parents always use paypal for online purchases. Is there something good about it?

 

I only use paypal for ebay purchases, sending money to folk or if I'm buying something cheap from a wee online shop. I use my credit card for stores like amazon, play or any store I buy from regularly and I trust with my details.

 

Pulling from their website:

I never really buy big things online, hah. Or buy big things in general. So Paypal works for me.

 

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Just had a little talk with my mom over Debit and Credit on Debit cards....and it slightly confused me more. I mean, I get the whole thing with Debit cards using credit, and Credit Cards, and the difference, but it's still weird. But she also said I should get into the habit of always using credit since it's safer, so I guess I should start doing that whenever I buy something now. Man, this is just such a pain...maybe I should have learned more about this stuff sooner. Although, I've never had a reason to know, but maybe I might want to change that view now

 

There's no reason to use a credit card if you don't have to. I use it because I shop a lot online and I tend to buy fairly large purchases. For everyday stuff you should just use your debit card.

 

Why should I care to run an average home?

I would most definitely prefer it. If in doubt, I will arrange to make my payments in cash and explain why I do not use credit cards. Anyone who is not willing to be understanding about my unwillingness to borrow money is probably not someone I want to buy from anyway. What if that house is borrowed?

I strongly disagree. There is something inherently wrong with a Ponzi scheme. I will explain what a Ponzi scheme is for those do not know.

A Ponzi scheme is a scheme in which a party (Ponzi) promises to make money for those who invest in the company. The scheme seems profitable enough and works similarly to a banking scheme. Many people invest their funds into the scheme and allow their money to grow.

Meanwhile, the scheme does not produce any wealth of its own in the form of products or labor. It takes in money, pays for itself and its employees, and does nothing else. When people come to collect their "interest", what they are actually getting is the money of the other customers, minus the money spent by the ones handing it to you.

This scheme profits the money handlers and, if they are smart, the customer who knows just how to make a profit, but in the end the one who makes a profit is just as guilty as the money handlers.

If everyone who invested in the scheme demanded their money back plus interest at the same time, the schemers would not be able to provide it. If everyone who invested in the scheme demanded their money back without interest, the schemers still could not give it back because they spent a good deal of it on themselves and gave a good deal of it away in the form of fake interest.

Credit cards and banks are Ponzi schemes, and they are inherently bad because they are bad business. Unless you happen to work for them.

They can be manipulated to profit the individual, but if everyone were mature like you say, then no one would profit but the bankers. Without people paying in massive debts, the banks are actually losing their customer's money, so the customer being mature is never a part of their plan.

 

oh yeah, I already figured that much. Even my mom says they never use a credit card unless they really have to

 

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Brb, moving this to the Discussion section.

 

I'm actually a bit surprised that you are so against using credit systems Makaze, you strike me as someone that would be able and willing to utilize the system. And it isn't a Ponzi scheme really, it is simply a unique business style. Normal business spends money to procure a product to then sell somewhere else at a profit. So if I were a soda company I would pay for ingredients to make soda and sell to the public. In the case of banks it is the same thing, but the product is still money. You get people to give you money with the agreement of money back based on the amount and how long (interest is literally the cost of borrowing money) Then with the borrowed money you lend that out for a higher interest rate then what you are paying to get the money originally. So you really end up with two major difference from generic business. First, you are getting your product from the public instead of a smaller party. Second, the product itself is money. Since banks are most effective in a large scale there ends up with so much fluidity in the system that they don't have a reason to deny any deposits, but yes in the event that everyone pushes the system in a specific direction it will fail. If people pull all their deposits then they don't have the money since it was being loaned out for profit (a somewhat unique problem since most business will buy something in full and not just borrow it, but that obviously doesn't work in this setup). If people pull all their loans then there would be a temporary influx of money before a slow death at the lack of profits.

Really banking is the lifeblood of the economy. What people perceive as wealth is not the physical money but the movement of money. If you drop the scale down to two people it becomes a lot easier to see. Lets our hypothetical economy only has five dollars. Both of us sell a product that the other one wants (reasoning being irrelevant) that both are conveniently worth those five dollars. Each time the money changes hands we both benefit, one gets money and the other gets a valued product. So if five dollars traded hands 20 times then we would both feel that we made $50, despite the fact that only $5 exists. Likewise if I fail to spend my money for an entire month then no one benefits from it, the economy feels empty despite the fact that again there is $5. Since you can't realistically spend all your money the moment you get it it makes sense to lend it out to someone who can. But normally there would be work involved in finding someone who would immediately use your money, insecurity in if your money is safe, and inconvenience in the fact that the return of you money would be irrelevant to your wanting to use it. Banking allows all that to be taken down in one fell swoop. But there are still the flaws mentioned earlier. I'll leave the cost/benefit analysis to you, but don't be blinded by the fact that there is a cost. The system is a stable one so long as it is not put under too much strain. Not using a bank because it might fail is like not using a bridge because it might collapse (notable comparison failure though in that the bridge would be strained by your using it while the bank would become more stable).


Why do I feel the need to go off on rants in the spamzone?

 

You're seriously asking that? When you know Makaze is involved? 'Nough said right there

 

A few more points.

I am absolutely against fiat currency. Prices should be agreed upon between individual parties without third party involvement. Currency should as well.

I am also absolutely against a bank-based economy. Centralization of production or a service is always a bad thing. Trade should be direct between two parties with no third party involvement.

To be perfectly clear, I feel that the economy as we know it needs to go and be replaced by peer to peer transactions based on an objective standard such as silver.

If a bank does not produce its own material wealth but spends and recirculates the material wealth of others, then it is a Ponzi scheme. The business style in itself is detrimental on a huge scale. Every economic crash to date in any nation has been based in the faults of centralized banking and fiat currency. Without inflation, housing bubbles, spending programs and other Keynesian fairy magic, the economy would thrive like any other ecosystem.

The cost is more than personal. If it was simple concern for the people I know, and it was a local town bank or credit union, I would not bother much. But that is not the case. The idea that other people, remote figures far away, can manage your property better than you can has been the greatest cause of suffering in history.

TL;DR: Ponzi schemes also "work" if people do not try to push the scheme in one direction. If people keep investing at the same rate that others are withdrawing, the illusion is kept up. That is why Ponzi schemes even survive as long as they do. Banks are just really large scale schemes. Bail outs are meant to prevent the curtain from being drawn on the schemes, but the US system and the European one are both crashing already. I have not seen, had reasoned out to me or personally experienced anything that suggests that banking is not Ponzi scheming and that the Federal Reserve's scheme is not collapsing on itself right now.

 

My point does not change with the form of currency, replace "five dollars" with "a gold coin" align the math to compensate the change and it all works. I just used that since I assume most people reading this are either American or are familiar with US currency. Though on another note, all currency is flat currency. If we were to decide the gold coin was worthless it would hit the same flaw, the difference is that what we call flat currency is more easily deemed worthless (especially at its induction)

I did mention that the services banks provide can be administered directly, but there are flaws. The fact of the matter is that these in between steps exist because they improve the quality in some way (making a better product, decreasing cost, improving production speed, etc.), if it was that much better to not use them then people wouldn't.

A Ponzi scheme is where the system is unbalanced and thus not sustainable. We're not talking about it dying down and requiring a jump start to get back on it's feet. It is like performing an endothermic reaction, it takes in heat to make the reaction take place, but unless it in some way produces heat back (directly or indirectly) then eventually you won't have the energy to continue it. This is not the case for banks (assuming a proper structure). The bank takes in more money through loans than it does paying off interest. They additional money taken in is of course released back into the economic environment when salaries are payed and people spend it. Banking would be a Ponzi scheme if they did not make loans to bring in interest money. Then when someone asked to withdraw they would be forced to pay with the money other people deposited. Obviously since the "bank" is spending money without making it then it will all dry up eventually.

Any system struggles under pressure, and sooner or later there is always pressure. The idealization that a system that is more "x" (natural, engineered, independent, codependent, etc) would be free of this fault is simply wrong. Some systems work better than others, and which is best will vary with outside factors, but the presence of a pressure failure is not a reason not to use a system unless you can miraculously provide an alternative system that doesn't seem to have one.

True enough. Remember this thread?

 

You either misread or mistyped. I said fiat currency, not flat currency.

The term fiat money is used to mean: *any money declared by a government to be legal tender. *state-issued money which is neither legally convertible to any other thing, nor fixed in value in terms of any objective standard. *money without intrinsic value.
http://en.wikipedia.org/wiki/Fiat_currency

Fiat currency is the opposite of a gold standard arrangement. In a fiat currency system, the currency value rises and falls on the market in response to demand and supply pressures. It is this fluctuation that makes it possible to speculate on future currency values.
http://www.vantagefx.com/education/forex-terms/

Coins or paper money that do not have metal value or are not backed by metal value.
http://www.numismedia.com/glossary.htm​

People are sacrificing stability and maneuverability for convenience. Furthermore banks promise people profit in the form of interest and loans are clearly profitable to the short-sighted.

And yet once again, it is smarter for the individual not to take out loans. If this economy is stimulated by stupidity, then it is inherently faulty, because it enforces bad habits and will create its own destruction.

What is good for a banking economy is bad for those who get the money last; the poor and the employees. For example, inflation. That new money that gets printed circulates among the elite and they make money. That is Keynesian logic.

"Would you like your pizza cut into eight slices or nine?"
"Nine. I am feeling especially hungry today."

If banks supposedly do not and/or are not drying up, then why are the nations' currencies becoming worthless, employment rates going down and banks getting bailed out for fear of failure?

Furthermore, exactly why is the idea of the economy and wealth as the movement of money a valuable concept? Aren't banks, governments and corporations the only ones who would stand to gain from infinite growth?

The idea of a system, as you call it, is what creates the faults. See above with fiat currency. There can be no fault when the "system" is just straight-up trade between two parties, no remote or central management of any kind.

 

Nope, especially since I joined about 3 months after that thread was made. But after looking through it, seems like you certainly went of on quite a few rants. I think you go off more on Makaze than I do. Although, I'm a laid-back person, and it takes a certain kind of "thing" to get under my skin, i.e. the only thing that can harm superman is kryptonite (terrible example, but the only one I can come up with). It just takes something "special" to make me go off on my rants. But Makaze no longer affects me, considering I've grown an immunity to him, and also, I've found that my views and his are opposites, so I just stopped caring what his views are.

Wow, you almost made me go off on a rant against Makaze...good job. Although maybe not so much a rant as more of me having a hard time saying what needs to be said.

And you know, while I'm thinking about it, what do you guys think I should do: get a $70 skullcandy headset, or a $30 Logitech headset, which I know works because I have an older, and much need of a replacement model of the same thing.

 

Sorry, the concept of fiat currency is one I read up on and the "i" looked like an "l" to me. I learned it by the wrong name and it isn't one brought up enough for my mind to correct it. I was talking about fiat currency despite naming it wrong.

Loans can be useful, but as we all know they are also dangerous. While I generally dislike the concept of "buyer beware" since it is not reasonable for a costumer to have the information needed to beware of, I do think it applies nicely here. The danger of loans is inherent to the process, be it through a bank a personal, and not entirely relevant to the nature of your specific loan (though some are better deals than others). So if someone fails to take the correct standpoint in a loan then I say it is their fault and not that of the bank. But loans are very necessary, if you can't barrow money from somewhere then post secondary education will be beyond the reasonable reach of most people. You will find yourself working a low income job and essentially all of that will go to housing (rented since you can't afford to buy) and general cost of living. By the time you scrap the money together to get into post secondary education it will no longer be worth it.

A system does not need to be human made, it is anything that determines how things interact. For example the foodchain is a system, and it is put under strain in the event of a drought. A barter system might suffer after a fire destroys and depreciates the intrinsic value of items.

 

umm, honestly, I have no idea what you're posting. The most I can get is something about loans being blah blah blah and economic babble.
But on that note, yes loans are extremely useful, and can actually be very important. Most people have to take loans to do school, especially in financial aid isn't enough. My mom is still having to pay off her school loans from more than 12 years ago. If you don't ruin yourself and actually try to get what you want after taking those loans, you might be able to pay them off. But you don't want to just take a loan, get into a class, and later say "F*** this", otherwise you're just in for a world of hurt....Kinda like my sister. (okay, that might have been a little uncalled for. But that will be brought up in another thread, because I do need to discuss about that issue)