Fiat money and borrowed fiat money are not the same, btw.

“But a large part of the horrific private debt you refer to was fully discretionary, buying more than necessary, or buying at all. That also INCLUDES overpriced homes, people did not have to buy at all, and certainly not everybody HAS to have granite countertops, one bathroom per bedroom (for the 6-year olds!), etc.”

Granite countertops for the kids. Puh-leeeze. Let me tell you the story of my folks, and the many I know of in the same situation. And none of them have granite anything, one bathroom, etc… Though they probably should (I would say gold, however) for all they’ve paid on their debts…

In 1986, they started financing their first home, for 32,000. By 1996 however, the roof starts leaking and the city for some reason says the gargage is an eyesore (ie, tear it down or be fined). But hey, that’s what cheap Polish immigrant labor is for (I don’t recommend that, btw, because in the process they tore up the yard and left a big mess… but I digress).

Okay, to that point they paid 36,000 on the mortgage, with about 12k to go. But it’s the 90s. Downsize, outsource… you fall behind on payments, which the interest has no problem destroying any progress you’ve made and even will make once your back on your feet. Now, they did make one mistake. They took out a HELOC to get by on. They also helped my brother with some of his education expenses.

Okay, so it went up to 90,000 in total. From about 2000 onward, though, they did manage to keep up with every single payment. So it’s down to (drum roll…) 78,000. In total, they’ve paid 132,000 for what amounted to a nominal 80,000 in debt.

Granite countertops my ass. If you wanna talk about who’s getting the real free ride, let’s talk about the usurers and how they’ve been making out. They’re probably the ones with the GD granite countertops. Let’s talk about the government, what taxes you because those usurers always manage to buy up THEIR debt to impossibly high levels.

And don’t give me that lip about renting vs owning. That’s utter bull. If anyone really thinks renters and landlords haven’t been affected by all this… Well, I would say wake up, but since they haven’t so far they probably never will, and so would do humanity better in just dying in their coma. Useless. And not to put too fine a point on it, but landownership in this country has quite a bit more meaning than competing with the GD Joneses. To engage in policies that put ownership out of reach of the majority of people (even those landlords who rent their property out) is criminal, and it only makes the citizen likewise a criminal. Don’t own your land, you’re not supposed to vote. Period. And don’t even get me started on property taxes and what it’s like to fall behind on that.

Anyway, of ten family members I know of, that’s pretty much the situation. Not a single granite countertop, or granite anything for that matter. One bathroom, no more than 1.5 acres…

All I want to know is: where’s their granite countertops? That’s the big mystery, here. Screw gold. Where’s the rocks?!

your proposal reads like a free lunch, and we know how many of those there are.

“What I propose is running the fractional reserve looting mechanism backwards which turns out to be as simple as distributing new legal tender fiat equally to every US adult.”

You clearly understand the nature, fraud and all, of the fractional reserve and fiat system.
Yet you propose a cure that consists of more of the same, hoping for a different outcome?
That is a definition of something, btw.

One must suppose that you believe an out-of-the-air creation of more money that is then distributed EQUALLY to everyone will make a difference vs. the system where it causes an UNEQUAL distribution (as present, from the middle to the top, as per Mises)?

This makes no sense, and that distinction won’t do it.
Are you also propsing that this equal distribution of the new money will become the only money going forward, or would you allow the old money to continue as well?

If you would allow the latter case (old + new), then there should be very little relative effect for the haves, as this tides carries everyone up equally. For the have nots, yes they would be able to destroy the debt, but much of that is not held or owed to those who have defrauded us.

And if you believe in the former case, you will needlessly give to those who should not receive anything, and keep from those that should get more.

Finally, people with real assets unencumbered will still do best, and guess who those are?

As in my post earlier, that is one of way to discharge the debt, default by inflation. This should elicit no uh-ohs around here, as Rick has stated that he believes in a serious (if not nec. hyper-) inflation after the deflation.

As to healthy PEs:

see this chart at:
http://www.chartoftheday.com/20100716.htm?T

Look at the chart and comment there for how long, and how often the current $60+ EPS has existed historically.
Hardly the norm!

The price of that 20K outdoor kitchen was paid via inflation when money was created from nothing via the FR (fractional reserve) loan process. The purchasing power was stolen from all money holders in the process. What I propose is running the fractional reserve looting mechanism backwards which turns out to be as simple as distributing new legal tender fiat equally to every US adult.

It would:
a. enable underwater home owners to pay down their mortgages to market price levels.
b. compensate savers for years of artificially suppressed interest rates.
c. Fix the banks in nominal terms.
d. Fix state tax revenues.

Our banking system is essentially a government backed counterfeiting cartel that pits borrowers vs savers. Well, it turns out that both savers and borrowers can be made good while at the same time fixing the banks in nominal terms. Not only is it justice but it is poetic justice in that it uses government to fix a problem caused by government privilege.

For that part of people’s expenditures that went higher and higher due to the long-term inflation you refer to AND that was NOT discretionary, you may be correct.
But a larg part of the horrific private debt you refer to was fully discretionary, buying more than necessary, or buying at all. That also INCLUDES overpriced homes, people did not have to buy at all, and certainly not everybody HAS to have granite countertops, one bathroom per bedroom (for the 6-year olds!), etc.

“…simply because of accounting entries then a reversal might easily be accomplished via accounting entries too.”

Those that are the beneficiaries of these “accouting” entries (and that is the redistributive (to the top) reason for having this system in the first place), will NEVER voluntarily give up these gains in order to make such entry-reversals, because they control this system. How would this be implemented against them?

Thus not so simple at all.
You seem to envision something like the reversal of a so-called mis-trade on an exchange.
Well, if you look at the history of how those mistrades are handled, they are (virtually) ALWAYS in favor of the financial industry actor and against the private party.
Try it yourself, put in a limit sales order at an “absurd” price and then claim a mistrade for all the typical reasons and see if you can get the whole thing reversed.

BUT, even if you would succeed, the transaction is fully reversible at that point, with a return to the “status-quo-ante”.

Thus is impossible, because real things (including services) have been performed and remunerated.
How do you reverse the installation of a 2ok outdoor kitchen if you have to place everyone back to where they were before they signed that contract?

Once a contractual debt has been incurred, it can only be discharged in two ways: meet the obligation or default.
This is also the major flaw behind the argument of those who poh-poh the BIS’ world total derivatives numbers of 500-600trillion as being just “notional”, and thus supposedly without meaning or consequence.

EVERY ONE of those notional dollars has a real consequence because it backs a contractual obligation, and thus needs to be gotten rid-off as above.

This is of course also true for public debt: If you un-account those, where will all those relying on the promised future income get it from (social security, public pensions, etc)?
Default is the inescapable conclusion, with the sea of tears that will bring.