Capitalism Needs a Sound-Money Foundation
Let’s give the Fed some competition. Abolish legal tender laws and see whose money people trust.
http://online.wsj.com/article/SB123440593696275773.html?mod=dist_smartbrief
This is an actual "stimulus" that will fix the mess.The Fed doesn’t like competition. Look what happened to the Liberty Dollar.
Varq, haven’t you noticed those at the top typically don’t look favorably upon competition?
The only way to change that is to knock 'em down a few pegs so they are no longer on top.
Of course I’ve noticed.
We are in a giant game of monopoly, with the ones in charge monopolizing everything from information to ideology to force.
Why should we be surprised that they insist on us using their Monopoly money?
Fortunately for us we can take definite actions to change things; this game is not dependent on randomly thrown dice.
[quote]LIFTICVSMAXIMVS wrote:
Capitalism Needs a Sound-Money Foundation
Let’s give the Fed some competition. Abolish legal tender laws and see whose money people trust.
http://online.wsj.com/article/SB123440593696275773.html?mod=dist_smartbrief
This is an actual "stimulus" that will fix the mess.[/quote]
(1) If your competitors can access their own peoples' wealth with fiat currencies, the the USA would be at a disadvantage militarily. We would have to fund our military with direct taxation. That consumes time and would also be unpopular.
(2) You cannot have an altruistic system in place without a fiat currency. People will not help stangers if it causes them direct pain. A fiat currency allows government to fund many more programs.
(3) Gold is a holdover from the Age of Reason, when reality was fixed. With the advent of non-rational philosophers (Kant, Hegel, Nietzsce, Rousseau, on and on), people no longer accept reality. For ex, they believe they can spend more than they earn --- there are no consequences because there is no objective reality.HH, this coincides nicely with the reality I wish to bring about.
Problem is that there are so few gulches in Minnesota. Damned flatland.
[quote]Varqanir wrote:
Problem is that there are so few gulches in Minnesota. Damned flatland.[/quote]
Just need to go the southeast corner.
[quote]dhickey wrote:
Varqanir wrote:
Problem is that there are so few gulches in Minnesota. Damned flatland.
Just need to go the southeast corner.[/quote]
Uncomfortably close to Illinois.
[quote]LIFTICVSMAXIMVS wrote:
Capitalism Needs a Sound-Money Foundation
Let’s give the Fed some competition. Abolish legal tender laws and see whose money people trust.
http://online.wsj.com/article/SB123440593696275773.html?mod=dist_smartbrief
This is an actual "stimulus" that will fix the mess.[/quote]
You have my vote
The Founding Fathers f’d up, IMHO. They could have abolished taxes and could have made gold and silver the only legal money. I guess even great politicians succumb to the prospect of power.
The Constitution of the Confederacy was actually much closer to an ideal.
[quote]Headhunter wrote:
The Founding Fathers f’d up, IMHO. They could have abolished taxes and could have made gold and silver the only legal money. I guess even great politicians succumb to the prospect of power.
The Constitution of the Confederacy was actually much closer to an ideal.[/quote]
Uh, did they not make gold and silver the only legal tender and did it not require an amendment to install a federal income tax?
[quote]orion wrote:
Headhunter wrote:
The Founding Fathers f’d up, IMHO. They could have abolished taxes and could have made gold and silver the only legal money. I guess even great politicians succumb to the prospect of power.
The Constitution of the Confederacy was actually much closer to an ideal.
Uh, did they not make gold and silver the only legal tender and did it not require an amendment to install a federal income tax?
[/quote]
Our Constitution is interpreted in many ways, depending upon the expediency of the moment. For ex, you can’t blockade anyone’s ports unless your at war. Yet Lincoln blockaded southern ports. See, to save the Union you kind of have to destroy it first.
[quote]Headhunter wrote:
orion wrote:
Headhunter wrote:
The Founding Fathers f’d up, IMHO. They could have abolished taxes and could have made gold and silver the only legal money. I guess even great politicians succumb to the prospect of power.
The Constitution of the Confederacy was actually much closer to an ideal.
Uh, did they not make gold and silver the only legal tender and did it not require an amendment to install a federal income tax?
Our Constitution is interpreted in many ways, depending upon the expediency of the moment. For ex, you can’t blockade anyone’s ports unless your at war. Yet Lincoln blockaded southern ports. See, to save the Union you kind of have to destroy it first.
[/quote]
Hey, they shot first.
EDIT: technically, ‘we’ shot first, me being from Texas. It just doesn’t sound as cool when I put myself on the losing side, though.
[quote]Headhunter wrote:
orion wrote:
Headhunter wrote:
The Founding Fathers f’d up, IMHO. They could have abolished taxes and could have made gold and silver the only legal money. I guess even great politicians succumb to the prospect of power.
The Constitution of the Confederacy was actually much closer to an ideal.
Uh, did they not make gold and silver the only legal tender and did it not require an amendment to install a federal income tax?
Our Constitution is interpreted in many ways, depending upon the expediency of the moment. For ex, you can’t blockade anyone’s ports unless your at war. Yet Lincoln blockaded southern ports. See, to save the Union you kind of have to destroy it first.
[/quote]
That is the kind of “union” Fritzl had with his children.
Here’s a question I can’t find an answer for. How the hell could a gold-backed currency work with today’s massive economies.
The numbers are as follows (Source: Wikipedia):
Meaning that for every ounce of gold there is roughly 38 000 M3-dollars and 5350 M1-dollars in circulation. Would converting these to gold vouchers make any difference? E.g. a fifth of an ounce of gold for a powerful laptop.
I do understand the destructive nature of a fiat-currency, but shouldn’t the basket of something tangible backing the currency at least be something that actually has enough value to back the entire economy? I mean, if the above-mentioned example isn’t enough, think of China, that only has gold reserves of about 6% of those of the US, but a GDP of about a quarter of the US’ and growing. There are other, more extreme examples as well.
Am I missing something here?
[quote]Liha wrote:
Here’s a question I can’t find an answer for. How the hell could a gold-backed currency work with today’s massive economies.
The numbers are as follows (Source: Wikipedia):
Meaning that for every ounce of gold there is roughly 38 000 M3-dollars and 5350 M1-dollars in circulation. Would converting these to gold vouchers make any difference? E.g. a fifth of an ounce of gold for a powerful laptop.
I do understand the destructive nature of a fiat-currency, but shouldn’t the basket of something tangible backing the currency at least be something that actually has enough value to back the entire economy? I mean, if the above-mentioned example isn’t enough, think of China, that only has gold reserves of about 6% of those of the US, but a GDP of about a quarter of the US’ and growing. There are other, more extreme examples as well.
Am I missing something here?[/quote]
yes, you are missing that any amount of money is enough to supply an economy, what is important is the relation of prices to each other.
So, you simply print a new dollar, a blueback or something and say it represents exactly one ounce of gold. Or half an ounce or whatever. Afterwards you outlaw fractional reserve banking and M3 will rapidly approach M1.
That would be very bad news for investment bankers, but good for almost everyone else.
Unfortunately and that really is a problem, even if you did that, another currency could do the same the US has done and create cheap money that floods the world, however, since there is no new world reserve currency in sight it is unlikely for the near future.
[quote]orion wrote:
yes, you are missing that any amount of money is enough to supply an economy, what is important is the relation of prices to each other.
So, you simply print a new dollar, a blueback or something and say it represents exactly one ounce of gold. Or half an ounce or whatever. Afterwards you outlaw fractional reserve banking and M3 will rapidly approach M1.
That would be very bad news for investment bankers, but good for almost everyone else.
Unfortunately and that really is a problem, even if you did that, another currency could do the same the US has done and create cheap money that floods the world, however, since there is no new world reserve currency in sight it is unlikely for the near future.
[/quote]
How come “any amount of money” could secure trading being commenced in an economy? Just to give one more example, Canada’s GDP is roughly a tenth of that of the US’s, but its gold reserves amount to a whopping 3,4 tonnes of gold (0,04 % of the US’s reserves). So Canadians would trade amongst themselves with about 0,4 % of hard money compared to my above example, the US. Which in reverse means, that an ounce of gold would buy 250 times more than in the US. This would mean that an ounce of gold buys things worth of 1,250,000 dollars! At this point it is completely irrelevant, if me buying a few houses, a couple of cars, moose and snowmobiles is backed by nothing or an ounce of gold. Do I make more sense now? I realise that the GDP isn’t the same as money in circulation and that this isn’t the most scientific method, I’m just trying to illustrate the magnitudes here.
Also, I have read Rothbard’s “mystery of banking” (which btw. taught me many things that a Master’s degree in economics didn’t) and I realise, that in a libertarian world/utopia, people would find an effective currency through some commodity. But should we at this point stick to analysing a single, official currency backed by gold in government vaults, I think there is a problem.
Regarding fractional reserve banking, it should be abolished.
Here is where all the plans of our ‘beloved’ leaders’ fail: more and more people don’t trust ANY paper currency any longer. Our leaders will have to simply declare bankruptcy, cancel most spending, and back a new currency 100% backed by gold.