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> As the war unfolded, ministers were pilloried for rewarding investors far too generously for surrendering capital which should have been sacrificed gladly as

> As the war unfolded, ministers were pilloried for rewarding investors far too generously for surrendering capital which should have been sacrificed gladly as a matter of patriotic principle Interesting how much harder it was for the government to get money back then. Wikipedia seems to say that WW2 cost the equivalent of $4.5 trillion, while the Iraq war is about $2.4 trillion. The Gold Standard seemed to have caused trouble with wars: WW2 had to temporarily suspend gold trading, and it was canceled entirely around Vietnam. Now we can spend trillions with it causing hardly any day-to-day trouble: A blessing when needed, and a curse when not.

hammock 9y ago
How has it been a curse so far?
- notfromhere 9y ago
  Quantitative easing has inflated asset prices. Downside is things like gold standards are a huge boon for asset holders and sucks for everyone else
  - hammock 9y ago
    QE would be good for asset holders then...? And gold standard would hold down asset prices. Not sure you're making sense
    - notfromhere 9y ago
      QE is good for asset holders as long as there is no inflation in wages to match asset bubbles. Gold standard tends to cause deflation, which is bad for debtors. I was talking about it from a inflationary perspective. QE didn't lead to inflation in the US example because of the way it was carried out.
      - hammock 9y ago
        And wages are not inflating (relative to assets)...so I still don't get how you think QE has been bad for asset holders to date.
danieltillett 9y ago
The economy is much larger today than back in the 1940s. My memory is something like 40% of the US economy was devoted to the war effort in WWII, while it would have been a couple of percent at most for the Iraq war.
- cat199 9y ago
  https://en.wikipedia.org/wiki/List_of_countries_by_military_expenditures https://en.wikipedia.org/wiki/List_of_countries_by_military_... Per this 2.2% of GDP in 2016 - after iraq with no 'hot' conflict. Google says 5.66% in iraq peak. Percentages of estimated net world defense spending in 2016: * US: ~36.2% of total world defense spending * China: ~12.7% * EU Countries listed: ~12.2% * Russia: ~4.5%

hammock 9y ago

How has it been a curse so far?

notfromhere 9y ago
Quantitative easing has inflated asset prices. Downside is things like gold standards are a huge boon for asset holders and sucks for everyone else
- hammock 9y ago
  QE would be good for asset holders then...? And gold standard would hold down asset prices. Not sure you're making sense
  - notfromhere 9y ago
    QE is good for asset holders as long as there is no inflation in wages to match asset bubbles. Gold standard tends to cause deflation, which is bad for debtors. I was talking about it from a inflationary perspective. QE didn't lead to inflation in the US example because of the way it was carried out.
    - hammock 9y ago
      And wages are not inflating (relative to assets)...so I still don't get how you think QE has been bad for asset holders to date.

danieltillett 9y ago

The economy is much larger today than back in the 1940s. My memory is something like 40% of the US economy was devoted to the war effort in WWII, while it would have been a couple of percent at most for the Iraq war.

cat199 9y ago
https://en.wikipedia.org/wiki/List_of_countries_by_military_expenditures https://en.wikipedia.org/wiki/List_of_countries_by_military_... Per this 2.2% of GDP in 2016 - after iraq with no 'hot' conflict. Google says 5.66% in iraq peak. Percentages of estimated net world defense spending in 2016: * US: ~36.2% of total world defense spending * China: ~12.7% * EU Countries listed: ~12.2% * Russia: ~4.5%