Is EU's RCE collapsing?

[Pirx Danford]

I'll say it with the words of one of my role models:
A collapse is a collapse is a collapse is dog meat!

(And a lapse is not a collapse)

[QuintusMagnus]

Originally Posted by Nihilist

did you know that a one cent piece (penny) only cost about 0.81 cent to manufacture? the US Mint sells the cent piece at a profit (1 cent) and uses the profit (0.19 cent) to pay for operating expenses and to pay back some of the national debt.

they produce 1040 one cent pieces a minute.

something to thing about eh?



how much profit you think they make from the dollar?

- ; )

Depends on the value of the dollar, methinks =)

lol jk, but yeah, I knew they kept the cost of change low, usually via diluting the metal in it. The metal isn't important, after all, since, just like paper money, it's the intrinsic value that determines purchasing power.

[BrianMik]

Originally Posted by TimUnleashed

I find that ludicrous. Not having a crack at you Nihilist. I just find it hard to believe. I mean, even when we still had 1c coins in Australia, I didn't have 32 of them... do people in the US hoard all these 1c coins? What the hell is going on over there?

Well, it is also due to the fact that they're worth so little that people have them laying around or stash it until its worth doing something with. I probably have at least a couple dollars worth of pennies laying around somewhere. Have about 20-30 in my car even.

32 cents per person? I would think the average person might have more than that. To offset those who have 0-32 there are people that have 1000s in jars saving up.

[QuintusMagnus]

Originally Posted by thoreau

Not when defense spending, social security, medicare, and health care spending soon to take up 75% of the budget.

This issue is whether you are a net borrower or a net lender. The U.S. is a net borrower and China is a net lender. Very important.

Not true. Many coutries, China especially, are selling off their dollars because of the loss in actual value and the loss in intrinsic value. The dollar isn't the standard bearer like it once was.

LoL, great shameless plug lol.

Greenspan is an idiot. Time will prove this truth.

Here's the thing with deficit spending. In times of economic boom gov't and citizens should be saving their money. Gov't should run a surplus and have lots of cash in their rainy day fund. When recession happens, and tax revenue fall, gov't can engage in deficit spending by using this rainy day cash. The problem is, NO ONE IS SAVING DURING THE GOOD TIMES. During economic growth periods the gov't (and citizens) are spending more and more and when the bad times come around they have to start borrowing money to just pay the bills.

Sounds like you are getting the standard conservative viewpoint of economics. For fun, you might want to read a little about developmental economics and how GDP is not a good measure of economic growth.

Now this was a far more interesting set of arguments. I honestly learned things here.

However, I will point out that those projections about our government programs as a percentage of budget are based off of the system as it is right NOW.

That is not a feasible situation. Eventually, the US will have to remember that:

A) Social Security was designed as a short-term, small safety net that was never meant to be a person's "retirement fund" the way many of the elderly are trying to use it now. SS is currently supporting a market failure which WILL fail, but before the government runs itself into a suicidal dive trying to pay for it, the most likely situation is that a fiscal conservative will come to power (like Bush had claimed to be when he showed up) and actually PRIVATIZE the system like it should be, thus taking a large burden off of our government and making the economy more efficient. It may, however, lead to a cooked market in the short term as a bunch of new money gets injected into the private market that would have been in traditional social security. Either way, I don't think it'll go down well, but it WILL happen.

B) Universal health care isn't a practical situation in this country, as it's too large a landmass and too vast a population to make it anywhere near monetarily feasible. The Democrats are trying to run on a campaign aimed at implementing it, but I doubt very seriously that they'll achieve more than slightly increasing the pool of people under medicare/medicaid. That, in and of itself, would be bad for the market, BUT, it's not as bad as it could be.

Either way, do I think the US is in great shape? No. Do I think we'll be the world's largest economy 20 years from now? No, and with the size of or population, we shouldn't be. Are there solutions to our looming problems? Definitely. Privatize social security to fix it TODAY, or, alternatively, import more labor (or legalize it, rather) from central america so that a group of younger, hard working people coming in will help the present group of upcoming citizens (smaller than the pool of retiring ones, hence the big problem) to pay for social security, and it'll slap a short-term band aid on it again...like Greenspan did in the early days with some government programs.

Greenspan I consider a smart man who simply didn't know how to react when he realized that if he set interest low the global economy would keep inflation low. He didn't seem to realize that instead of market-wide inflation, it concentrated the effects in US assets as foreign economies bought US assets with the dollars they were being given.

In and of itself, the ownership of US assets by foreign companies I don't consider to be a bad thing. Heck, the US has been doing it across the globe for years, so our seemingly "we can do this, but you can't do it back!" mentality seemed dated at best. However, it IS true that with the way this was managed we created a real estate bubble that was a tool of our own injury. The thing that concerns me now is Bernanke's seeming inability to do other than Greenspan did. But Greenspan was a very smart man, who simply didn't know how to handle the full extent of the global economy. The 90's were his day in the sunshine. I don't blame Bush for keeping an intelligent man around, but Greenspan needed to go when he did, he was running things into the ground I'm afraid.

And again, I know, it's not the standard bearer (or is becoming "not" the standard bearer) and honestly, with the growth of the moderate growth of the European Union and China, I'm not sure that it should really be. I'm sure it'll stay the main unit of trade for the short term, but I'm not concerned. I should preface all this by saying that I'm an economics major that's primarily concentrating on economic development. I realize that the world turns on purchasing power parity, and that my "biggest economy in the world" speech was more for effect than real punch =). But currency doesn't bother me much (bear in mind, again, I'm relatively early on in some of the areas of my studies, but it's always been my opinion that the active manipulation of a currency can be for either good or bad, but takes alot of nerfing to do either.)-the betterment of lives concerns me. What happens, to me, if the dollar goes down? It gets cheaper to produce goods here, our economy rebalances away from being QUITE so heavy to services, and we expand the mass customization that US companies are already taking part in. I'm not saying Big Steel and the car industry are coming back-I'm saying, "Dude, you're getting a Dell" =) (p.s.-I don't like dells, but it was too catchy not to go for it!).

And yes, the US government should save more. It's the nature of a democracy such as ours to run a deficit, though honestly I don't think, having come from a representative republic, that I could stand being under a system like Parliament (I lived in London for 6 months studying abroad...never met a person who had a good thing to say about Parliament, but they all seemed resigned that it'd "do what it does."). However, the US is capable of listening to its advisors and adjusting, granted, it does this later than it should, but it CAN do the right thing when faced with the cold, hard reality of impending doom. It was a unique problem of the present administration that it had (one, although the second at least is stabilizing, though I wont say it's "going well." We had reason to be in Aghanistan, though, no matter how we nerfed the hunt for bin Laden) a war to fight and the economy was rebounding under Greenspan's lower-interest urging. Thus we were spending into the boom, and now we'll be spending in the slump/recession, I'm sure. However, it should be noted that our debt as a % of GDP, while growing worse, isn't horrible. The concerning thing is that if a true fiscal concervative (I believe the candidates out there right now are all giving it lip service) doesn't come to power soon, we may be in it deep. However, once you line up the economists on every major news network in the country saying we need to pay down the debt-well, things will happen. They just have to get rough first.

HOWEVER, in defense of "We, the People..." alot of the increased spending of recent times have been offset by investments in real estate and capital markets. Granted, the real estate turned out to be a bad investment for many, but this is something that happens, and hopefully the government will let them fall on their face so that they learn something from it. Do Americans spend too much? Sure we do. But is it as bad as it looks on the surface? Nah. And more importantly, when it comes right down to it-the market will correct itself. This sounds like a sunny-side up view, but bear in mind that, as I mentioned moments ago, I advocate the real estate market falling flat on its face so that it learns not to bubble. Who knows what it'll take to make Americans save more, but well, Lootius tends to strike down unbelievers.

Either way, the US economy is in for a correction, and maybe more than one. But this economy wont go into a depression, nor will the USD cease to be important in the world, it'll just cease to be the necessary tool of trade. I honestly don't care what the PED is tied to (or if it's tied, I shy away from tied rates anyway!), since honestly I don't plan to cash out for a long, long time, and by then the whole mix could be much different. But I DO think that the US economy, after correction and after forced-streamlining of the government, will be in far better shape than many across the globe, and will be ready to lock horns with the other soon-to-be "big boys" of the market.

Originally Posted by TimUnleashed

But back on topic!

What was the topic again? Oh well... I'll just argue about economic conspiracy instead...



Isn't a budget surplus just the government saying "we spent less on you this year than we recouped from you in tax"? If so, that's EASY and has nothing to do with paying off national debt. In fact, if you don't spend money paying off national debt, you're more likely to post a surplus!

ROFL! *tries really hard to detect sarcasm and concludes you actually think this* Thought-provoking comment, Vedder, I hadn't thought of the world like that, but I can't say at this point I agree - the net is SO useful, it would have to take a piece of everyone's lives with it, so I don't think too many people are going to want to let it go... we shall see, though


Hmmmm... *quickly does the maths*

So, if we assume that the US Mint has only been making pennies for 20 years:
@1,040 pennies a minute, x 60 mins in an hr, x 24 hrs in a day, x 365 days in a year, x 20 years = 10,932,480,000 billion pennies.

Now according to one website, the US has about 303,500,000 people. If I assume that say one in ten pennies ever created has now been lost/destroyed, there are still 9,839,232,000 pennies out there. That means there are 32 pennies for every single person in the US. Wow.

I find that ludicrous. Not having a crack at you Nihilist. I just find it hard to believe. I mean, even when we still had 1c coins in Australia, I didn't have 32 of them... do people in the US hoard all these 1c coins? What the hell is going on over there?

That's only if it's been happening for 20 years. How long has it been happening? 40 years, for 64 pennies each? 80 years, for 128 pennies each? If you gave me 100 pennies the first thing I'd do is cash them in for ONE COIN. Surely if you're right Nihilist, there's a massive pile of pennies somewhere that could be melted down and made into a bridge that goes from Washington DC to the moon or something?

I just did a quick check...I have...about 14 pennies. Far more dimes, though the quarters usually go to worship the Coca-Cola shrine. =)

Yes, if you don't spend money on the deficit, you can run a "surplus." However, the US gov wasn't JUST running a surplus via not paying the deficit back in the late 90's, cmon now. You postulated one reason, but you didn't give the whole kit and cabootle!

Incidentally, though, the vast majority of these pennies are likely in "reserves" of sorts-cash registers waiting to pay change to buyers. That's the only place I've seen rolls of them, anyway (1 roll=50 pennies).

Originally Posted by Sloe

i don't wanna start a conpiracy thread, just was commenting on the fact that the debt is much deeper than u'd realize, as money that is actually tied up in other things is used to make debts look less large. To take money that is being currently used in something to artificially make a deficit look less doesn't actually make it so. I never meant the cost of making the money, i'm talking about the taxes that most ppl don't realize. Look into income taxes pls, and find out if there's no controversy Now back to topic, i just made comments on other's posts and this went a little out of hand, i apologize lol. (If u don't agree, leave it at that, i don't hold a monopoly on being right and neither do any of u likely) IMO, i think the PED should b tied to a more stable economy, but just my 2 cents

EDIT: i admit my example was an EXTREMELY simplified and not very worthy one, but i hate typing as u see by the fact i generally don't write 6-7 paragraphs in frustration and anger. lol ....PS, SKY IS NOT FALLING!

And in other news, the earth is rising to smack into the sky...lol sorry, I don't agree with it, just had to say it lol.

I would point out, though, that the European Common Market, the likely target of your suggestion box for "stable-er currencies" has some looming issues of its own. I don't confess to be any manner of an expert (or, indeed even all that cynical. I admire German industry and the entrepreneurial quality that the EU has spawned in Europe, finally giving it the breadth of market (or something closer to it) that the US economy has had in the past. I honestly wonder how long it'll be until the EU countries take the next step and start combining military forces, if it's not already done.), however, unless things have changed-much of Europe has a stable or declining population. Given that, and the highly socialized nature of its health care and other systems (we're not even close to their levels and I'm already wanting to toss the anchor out the window to slow us down!)-wont the EU/ECM face the same problem that the US will in the future-big, hairy government programs "for the good of the masses" that will have to be paid for by a labor pool that's shrinking relative to the size of the pool of retirees? It IS still raining in London, after all, so there's gotta be SOME things that hold true over there!

[Auktuma]

Originally Posted by Ronin

Is Entropia universe's Real Cash Economy crashing?

I think first of all you need to define/findout what "Entropia Universe" is, how it deals with "Real Cash" and what "crashing" of it looks like. Only after that we will be able to answer the question.

Do read EULA, I think you will find many interesting things/terms/conditions/rules you have accepted. Just read it and try to understand what for we pay "real cash". Each of us separately. Various people pay real money for virtual items/abilities/opportunities seeking different goals so "crashing" touches different people differently. Question as it is isnt correct, exact. Sure, for "Big PED with 1 meter tongue" it is crashing, I hope, but dont think for people who are buying just fun/mood/joy for their "real cash" EU is still OK and attractive more and more with each VU.
I have some valuable "property" but really look to it as to trust given by media providers (MA) on providing some kind of services to community. It's just trust I will act right way and wont use it to harm community.
One more thing - value of item is defined only by agreement between seller and buyer. For rare items there are few sellers and few buyers so it got high risk to own/have it - MA guarantee just TT value of it.
Value definition: say you wanna be PKer #1 and you need appropriate gear. You pay for it price what you imagine you could on achieving your goal. One man could pay 100k USD and other could value "PKer #1" title just at 10k USD. Will and when seller find "right" buyer there are no guarantees.
EU wont crash for all, fun making factor is already high. MA officers told not once: people join and leave media all time. Those who left it - EU "crashed" for them
Well, I'll say until EU will be media we could have fun, where we could play the role we like - it wont crash and we will pay for service provided by entropians and we will have fun on providing service.

Have a nice day and stay, my friends
/auk

btw should we rename thread from "will EU RCE..." to "will US/world Economy ..." . So many thought on the theme.

[cheeky monkey]

Originally Posted by QuintusMagnus

however, unless things have changed-much of Europe has a stable or declining population. Given that, and the highly socialized nature of its health care and other systems (we're not even close to their levels and I'm already wanting to toss the anchor out the window to slow us down!)-wont the EU/ECM face the same problem that the US will in the future-big, hairy government programs "for the good of the masses" that will have to be paid for by a labor pool that's shrinking relative to the size of the pool of retirees? It IS still raining in London, after all, so there's gotta be SOME things that hold true over there!

Actually Quintus, Europe is in far worse shape on these matters. The birthrate in most western european counties is far below the 2.1 rate of children/mother considered needed to maintain a stable population. Germany in 2006 became the first industrialized nation ever to decrease in population outside of war. Japan, Italy, Spain are close behind them.

Four articles on the matter
RAND Research Brief | Population Implosion? Low Fertility and Policy Responses in the European Union
Negative Population Growth
What can governments do to make fertility rates go up? - By Michelle Tsai - Slate Magazine
Aging of Europe - Wikipedia, the free encyclopedia

a quote from the wiki article.

"The Economic Policy Committee and the European Commission issued a report in 2006 estimating the working age population in the EU will decrease by 48 million, 16%, between 2010 and 2050, while the elderly population will increase by 58 million, 77%. By 2050 the ratio of Europe's working age to senior age population will decrease by 50%, two workers instead of four for every retiree"

In a nutshell, Europe has fewer kids, more elderly (worse worker/receipient ratio in social spending). That combined with more lucrative pension system is a bomb that will blow up much earlier than the US.

The US has the advantage that we can see what Europe and Japan do, and see what works...or does not work.

[GoNi]

But consider that there is a huge amount of imigrants to germany, so the low birth rate of germans is fairly compensatet by new imigrants that do the work.

Imigration leads to other social conflicts, but thats another story.

Don´t think the sky is falling in germany, although there are some major problems that need to get solved soon.

[Auktuma]

1st actor: "Do you know what talk is about here on this thread?"

2nd actor: "BS for sure - I see no any signs on that: I've taken just 3rd lesson of 30 on "Disco" from my dance instructor and after I will have loong practicum on "Pogo""

3rd actor: "WTH going on! No miners selling ores cheap and no crafters buying ores high. Am I in the hell? EU CRASHING!!!!"


No common answer to this personal question.

[cheeky monkey]

Originally Posted by GoNi

But consider that there is a huge amount of imigrants to germany, so the low birth rate of germans is fairly compensatet by new imigrants that do the work.

Imigration leads to other social conflicts, but thats another story.

Don´t think the sky is falling in germany, although there are some major problems that need to get solved soon.

Goni,

I am not saying the sky is falling on Germany. Quintius asked whether Europe would face the same cirsis eventually. My post is to point out they would face it sooner (and harder) than the US would.

Also, the population decrease in 2006 in Germany (I have not seen 2007 figures) is not purely birthrate.
Population change is (Births + immigration) - (deaths + migration)
So immigration, and emigration, are accounted for.

Again, I am not stating the sky is falling on Europe. Just that the sky is a little lower there (and Japan) than in the US. I would stick a smiley face on that quote, but I do not really consider it a funny matter.

[QuintusMagnus]

Originally Posted by cheeky monkey

Actually Quintus, Europe is in far worse shape on these matters. The birthrate in most western european counties is far below the 2.1 rate of children/mother considered needed to maintain a stable population. Germany in 2006 became the first industrialized nation ever to decrease in population outside of war. Japan, Italy, Spain are close behind them.

Four articles on the matter
RAND Research Brief | Population Implosion? Low Fertility and Policy Responses in the European Union
Negative Population Growth
What can governments do to make fertility rates go up? - By Michelle Tsai - Slate Magazine
Aging of Europe - Wikipedia, the free encyclopedia

a quote from the wiki article.

"The Economic Policy Committee and the European Commission issued a report in 2006 estimating the working age population in the EU will decrease by 48 million, 16%, between 2010 and 2050, while the elderly population will increase by 58 million, 77%. By 2050 the ratio of Europe's working age to senior age population will decrease by 50%, two workers instead of four for every retiree"

In a nutshell, Europe has fewer kids, more elderly (worse worker/receipient ratio in social spending). That combined with more lucrative pension system is a bomb that will blow up much earlier than the US.

The US has the advantage that we can see what Europe and Japan do, and see what works...or does not work.

I thought as much, I just didn't want to lay it open based on conjecture alone. I knew, from my studies, West Europe's population was in decline. As someone mentioned, immigration offsets part of this, and as I mentioned earlier, immigration into the US makes us grow faster than we would have "in a bubble" as well...and both will help keep the coffers "ringing" somewhat also, but both are only a band-aid.

I would point out, though, that while we can all clearly see things that don't work in Europe...both democrats are still trying to force a form of universal health care upon us. I honestly almost want to stop watching Dem debates any more. Between that and their decision to take turns bashing NAFTA (even though the "First" (after Monica) "Lady's" HUSBAND signed it into law!), I find it hard to eat and listen to them at the same time. Absolutely unbelievable. The funny crap is that they use France's system as a "good" example-most of the French have to be insured by companies on TOP of the government system!

And yeah...I just wish we could pull the proverbial plug on some of the crap out there-I'm afraid that, as the population ages, it's going to take a senate and house being elected SAYING one thing and DOING another to effectively end Social Security, much less Medicare/caid/whatever expansions they try to force on it.

But yes, it WILL help (political popularity of action-wise) that we get to see the sky fall elsewhere first, although undoubtedly that will give us more market instability for a while.