Okay, I phrased it wrong. A state, by its very definition, is something that claims a monopoly on violence, and exercises the final authority over its control. This is something which you can learn in PoliSci 101, Weber. Only anarchist nutjobs would choose to dispute this. If a state can have a monopoly on violence, then why can't it have a monopoly on money, which is just as important? Like I said, compare the dollar with current "free-market" currencies like BitCoin. I'm arguing that the Ron Paul panic of "ZOMG INFLATION WE'RE ALL GOING TO DIE BUY GOLD" is bullcrap at best, and that the Federal Reserve is a legitimate and important institute. That's pretty much it. It is nowhere as big of a problem right now as compared to that tiny "we don't have jobs" problem. Secondly, you mention food and oil..... but they aren't rising because of inflation, because as already demonstrated, inflation rates aren't that big. They're rising because China and India are getting richer and consuming more. Inflation is such a small thing compared to that.
In our system, we haven't given the state a complete monopoly on violence. We still maintain the right to self-defense. I simply don't think its right for the state to exercise that monopoly by killing individuals. Especially when you consider how imperfect law enforcement and the courts have been at applying the death penalty. I'd rather the state not execute anybody than to make a mistake that results in the death of an innocent person. Would you not agree? I'd dispute that, and I'm no anarchist nutjob. I don't think you should always listen to what your PoliSci 101 professors are telling you, especially when it flies in the face of common sense and civil liberties.
what? To help explain deposits: http://en.wikipedia.org/wiki/Federal_funds_rate To help explain loans - these are mortgage but happens with almost all loans: http://en.wikipedia.org/wiki/Mortgage-backed_security These are just 2 simple examples and there are books and books on this. Bottom line...not a ponzi.
The problem with this is that it assumes that money/wealth is increasing (or will be, when banks get involved). But the flipside is that the Fed also has the ability to pull money out of the economy when things get stronger, and tons of wealth has been destroyed over the last several years which helps counter inflationary pressures.
