S03E02: Death and Taxes

S03E02: Death and Taxes

Featuring Hosts: Matt Carano, Tom Hudson, and Nick Boyle Engineered by: Matt Carano

Produced by: Tom Hudson, Matt Carano, and Nick Boyle

 

Featuring Hosts: Matt Carano, Tom Hudson, and Nick Boyle

 

Engineered by: Matt Carano

 

Produced by: Tom Hudson, Matt Carano, and Nick Boyle



News

• Bearcat
• • http://www.unionleader.com/safety/After-breaking-down-numerous-times-Nashua-to-purchase-new-Bearcat-for-301k-04062018
• Sales Tax In Us
• • http://www.unionleader.com/article/20180408/OPINION01/180409412/0/FRONTPAGE http://www.unionleader.com/Internet-sales-tax-in-U.S.-faces-a-Judgment-Day
• Death Penalty
• • http://www.wmur.com/article/nh-house-committee-takes-up-death-penalty-repeal-bill/19681064
• Medicaid
• • http://nhpr.org/post/medicaid-expansion-clears-first-big-hurdle-nh-house#stream/0
• Backpage.com seized by feds
• • http://nh1.com/news/national-video/indictment-accuses-backpage-founders-of-aiding-prostitution-2
  • http://econlog.econlib.org/archives/2018/01/craigslist_redu.html
• Manchester homeless camps in the crosshairs
• • http://www.unionleader.com/social-issues/manchester-camps-in-the-crosshairs-1-homeless-enclave-bulldozed-2-others-eyed-20180408

Events

• Freecoast Liberty Outreach Meetup 12th Exeter, 19th Hampton
• Matt’s Crypto Talk

Special Segment - Autocrat Of The Week

• Matt - Steve Marchand
• • https://en.wikipedia.org/wiki/Steve_Marchand

NH History

• Bretton Woods Conference
• • 730 delegates from all 44 allied countries
  • July 1st-22nd 1944
  • Hosted at the Mount Washington Hotel in Bretton Woods NH
  • Main Objective: Establish a new international monetary order
  • Lessons Learned from the past
  • • At the end of WWI the allies imposed large reparation payments. These payments were supposed to cover the debt accumulated by Allied forces during the war and help them pay to rebuild their countries.
      Result: Germany printed money to make the reparation payments causing hyperinflation. (e.g. 1 loaf of bread in 1918 ¼ of a Reichsmark, 1 loaf of bread in November 1923 80 billion Reichsmarks
    • Most countries response to the Great Depression was trade restrictions(tariffs, quotas, etc) to improve account deficits and stop reserve loss. Retaliation against trade restrictions only pushed the level of restrictions to international trade higher and further suppressed output and employment in many countries.
  • New realizations
  • • Even though the conference participants were dedicated to capitalism, John Maynard Keynes’ economic ideas were flourishing(unfortunately). Keynes prescribed during recessions an increase in government spending, to prevent aggregate spending from falling. Reflecting the Keynesian ideas, the welfare state emerged out of the Great Depression.
  • The two major personalities there were Keynes, representing Britain; and Harry Dexter White, representing the U.S.
  • The British plan
  • • Keynes proposed an International Clearing Union (ICU) as a way to addressing current account imbalances. He wanted to avoid the reappearance of persistent and large current account deficits that happened during the interwar years (1918–1939), which increased countries’ debt and debt payments and decreased growth at the global scale.
    • Keynes thought of the International Clearing Union as a bank with its own currency (called Bancor), exchangeable with other currencies at a fixed rate. He proposed using Bancor to measure countries’ trade deficits or surpluses.
    • Countries with current account deficits would have an overdraft facility in their Bancor account with the ICU. He worked out specific numbers regarding the size of the overdraft facility. His proposal implied a maximum overdraft of half of the country’s average trade size over five years. If a country needed funds higher than the overdraft, it would be charged interest, thus motivating the country to devalue its currency.
    • Keynes’s plan implied an interest charge of 10 percent if a country’s current account surplus was more than half the size of its permitted overdraft; this solution would motivate these countries to lend more. At the end of the year, if the country had a current account surplus that was half the overdraft, the ICU would confiscate the surplus.
  • The American Plan
  • • The U.S. agreed on the necessity of an agency to manage current account imbalances, but Keynes’s idea of the ICU was too interventionist for the American side. Additionally, the U.S. saw itself as a surplus country in terms of its current account in the years to come and didn’t want such interventionist ideas to be practiced on the U.S.
    • White proposed the International Stabilization Fund (which later became the International Monetary Fund, or the IMF), which placed the burden of balancing current accounts on deficit countries and imposed no limits on surplus countries.
    • White’s Plan included a new multilateral development agency that would plan and finance economic reconstruction in all war-torn countries, allied or aggressor. The International Bank for Reconstruction and Development (IBRD, part of today’s World Bank) emerged from the American ideas about reconstruction.
  • Result
  • • Created the International Monetary Fund & World Bank
    • IMF monitors exchange rates and lend reserve currencies to nations.
    • World Bank provided financial assistance to reconstruction for countries post-WWII
    • IMF pegged all currencies to the US dollar. The US dollar was pegged to gold. This ended in 1971 when Nixon got off the gold standard. Now all currencies “float”

http://www.dummies.com/education/finance/international-finance/the-impact-of-the-bretton-woods-conference-in-1944/