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Posted on 2/13/14 at 9:50 am to Porky
quote:
learn
You and I must have very different definitions for this verb. I watched this video a long time ago, and I have no desire to get into the problems with this fricking video.
All I can say is this, and I say this a lot. Picking up a girl at a bar has very little to do with how handsome and charming you are, but everything to do with how handsome and charming you are compared to every other guy in the bar. Finance is no different.
This post was edited on 2/13/14 at 9:52 am
Posted on 2/13/14 at 9:52 am to BennyAndTheInkJets
quote:I do, but that is beside the point. I though we were talking about currencies.
You're more than welcome to go buy commodities in the market place.
But maybe I'm mistaken - wouldn't be the first time. Enlighten me, what alternative currencies are legal to use in this country?
Posted on 2/13/14 at 9:55 am to BennyAndTheInkJets
quote:
All I can say is this, and I say this a lot. Picking up a girl at a bar has very little to do with how handsome and charming you are, but everything to do with how handsome and charming you are compared to every other guy in the bar.
For me, it's not about image. It's about substance. I'm not trying to pick up girls.
Posted on 2/13/14 at 10:12 am to LSUnKaty
quote:
I do, but that is beside the point. I though we were talking about currencies.
But maybe I'm mistaken - wouldn't be the first time. Enlighten me, what alternative currencies are legal to use in this country?
So you want a currency that's backed by a commodity. Know that a commodity's value will rise and fall with supply/demand for that commodity. So looking at currency, a currency by definition is a store of value and medium of exchange. As a medium of exchange, you can actually buy/own a commodity and sell it on the spot market at T+0/T+1 and get dollars to buy something. Although there is an extra step, I'd argue its fairly meaningless in terms of a medium of exchange if you would rather keep your store of value with a commodity rather than dollars.
Now the store of value issue is different. Commodities are much more volatile than the dollar could ever even hope to be. Actually, the volatility of the dollar index since QE started has been the lowest in history. The store of value for the dollar is based on supply/demand for the dollar. The demand side for the dollar is dominated by the operational use of the dollar as the reserve currency of the world (which by the way, isn't going away any time soon) as well as the relative strength of the US economy and markets (which by the way, is still stronger, deeper, and much more reliable than any other country in the world). The supply/demand mechanics for a commodity, say gold, will be driven by factors that have nothing to do with the relative strength of the US economy and markets.
Now I know your response will be that you're talking about a commodity backed currency, and this is the historical background: Historically, commodity backed currencies were operational pains in the arse. Shipping gold back and forth between countries over time horizons based on relative FX supply, pegging reserves to the point that hindered economic growth, not allowing actual market demand for your country's currency to dominate due to the fact that you were somehow pegged to another country, etc.. The gold standard was an operational pain in the arse, it hindered economic growth, and it actually made currency values much less market driven. True fiat may have its flaws, as does the US economy, but its flaws ,as well as the US economy's, are much more insignificant compared to the gold standard or any other economy in the world.
Posted on 2/13/14 at 10:25 am to BennyAndTheInkJets
quote:
The gold standard was an operational pain in the arse
Absolutely...for politicians and mega-banks. If they didn't have a dollar backed by something of substantial value, they could then create/print the illusion of such to finance wars and other useless social endeavors which are based on the creation and implementation of never ending insurmountable debts, fueled by deficit spending, taxes, and inflation.
This post was edited on 2/13/14 at 10:35 am
Posted on 2/13/14 at 10:37 am to Porky
quote:
If they didn't have a dollar backed by something of substantial value, they could create/print the illusion of such in financing wars and other useless endeavors which are based on the implementation of never ending insurmountable debts, deficit spending, taxes, and inflation.
Meh.....the issue you are talking about exists, but it's in the congress, senate, and executive branches of government.
The connection that you are trying to make is that the Fed enables the government to do these things, but the issue is much more complicated.
Just one man's opinion, but if you create rules that reign in government spending, force them to have an actual budget, eliminate the defecit spending, and reign in big government you solve the Fiat currency issues and the hidden inflation tax. It's the government you should have a problem with, not the FED.
Now, should they be audited and should there be more transperancy? Yes. However: ask yourself who is preventing this level of transperancy, the FED itself or the government?
Still need a Fiat currency in today's world. Backing it with gold the way we did it before we went to a Fiat currency system doesn't really help.
Reign in government and you solve your issues with a Fiat currency. Key to that will be education of the masses, which will be hard due to the government control of education.
Posted on 2/13/14 at 10:39 am to Porky
quote:
Absolutely...for politicians and mega-banks. If they didn't have a dollar backed by something of substantial value, they could create/print the illusion of such to finance wars and other useless endeavors which are based on the creation and implementation of never ending insurmountable debts, deficit spending, taxes, and inflation.
It's fairly obvious you have pretty set in stone beliefs so I'm not going to waste my time explaining this. All I'll say is look at the data. Look at global developed wealth creation pre, during, and post Bretton Woods, look at Britian pre, during, and post Churchill going on and off the gold standard, look at the Federal Reserve's actions between '29 and '31, please just do some research that isn't from some fricking YouTube video.
Posted on 2/13/14 at 10:49 am to ironsides
quote:
It's the government you should have a problem with, not the FED.
It's a hybrid. I don't have a problem with either per se. If our government had full control in the sense of nationalizing the Fed, that would perhaps help solve part of the problem to a large degree. Both should serve the American people and not private interests. Backing the dollar with something of substantial value might further eliminate its ability to continually borrow without equity from those who can lend without equity (fractional reserve banking) with the goal of repaying the debt through taxes and inflation.
This post was edited on 2/13/14 at 11:03 am
Posted on 2/13/14 at 11:05 am to Porky
quote:
I don't have a problem with either per se.
You don't have a problem with government spending out of control?
The Fed is just reacting to the government, which is presumably the will of the people.
NOW, if we could just get the people to stop taking CNN's opinions and start thinking critically and studying up on problems, maybe their will would be different.
I don't know how you go back to a precious metal standard without blowing up the entire system, and I don't know that it changes anything except the government spending part and makes us less flexible to compete in a global marketplace.
And I hate the Fed, but after reading some of the opinions around here and thinking critically about it - it's a complex problem I think the problem is Government, but we can agree to disagree.
Posted on 2/13/14 at 11:09 am to ironsides
quote:
You don't have a problem with government spending out of control?
That's not what I said.
quote:
The Fed is just reacting to the government, which is presumably the will of the people.
Dammit man. If that's true, as a country, we're too ignorant to survive.
quote:
And I hate the Fed, but after reading some of the opinions around here and thinking critically about it - it's a complex problem I think the problem is Government, but we can agree to disagree.
The problem is both when both are playing the same game. That doesn't mean the game can't change where they both can serve the people...you know...the ones who pay the bill.
This post was edited on 2/13/14 at 11:21 am
Posted on 2/13/14 at 11:19 am to BennyAndTheInkJets
Thanks for taking the time to type all that out. I really appreciate your response and I learned something.
I have a few questions.
1) Why are you so sure the operational use of the dollar as the reserve currency of the world isn't going away any time soon? This worries me because if the value of the dollar is based on supply and demand as you say, what is going to happen if/when demand for the dollar around the world goes down after the unprecedented expansion of the monetary base we have seen in the last decade or so?
2) In terms of volatility, what do you say about the cost of consumer goods like shoes and suits in terms of gold vs dollars?
3) In a previous post you talked about low inflation - do you refer to cost inflation like the CPI?
4) I still would like to know why we can't have competing currencies and let the market determine which it likes best.
I have a few questions.
1) Why are you so sure the operational use of the dollar as the reserve currency of the world isn't going away any time soon? This worries me because if the value of the dollar is based on supply and demand as you say, what is going to happen if/when demand for the dollar around the world goes down after the unprecedented expansion of the monetary base we have seen in the last decade or so?
2) In terms of volatility, what do you say about the cost of consumer goods like shoes and suits in terms of gold vs dollars?
3) In a previous post you talked about low inflation - do you refer to cost inflation like the CPI?
4) I still would like to know why we can't have competing currencies and let the market determine which it likes best.
Posted on 2/13/14 at 11:22 am to LSUnKaty
quote:
I still would like to know why we can't have competing currencies and let the market determine which it likes best.
Bingo!
This post was edited on 2/13/14 at 11:24 am
Posted on 2/13/14 at 11:32 am to BennyAndTheInkJets
Goldennugget has a long history of shitty threads
Posted on 2/13/14 at 11:38 am to goldennugget
quote:
Is there anyone here who supports fiat curreny/the Federal Reserve?
Me.
quote:
I think that a lot of the economic problems we are facing are directly related to fiat currency and the federal resevere
The latter is arguable, the former is just not true.
Posted on 2/13/14 at 11:39 am to LSURussian
quote:
As opposed to what? Carrying around gold bars?
You shall not crucify mankind upon a cross of gold!
Posted on 2/13/14 at 11:59 am to LSURussian
quote:Interesting how we have been conditioned to believe that FEDERAL RESERVE NOTES are the only option in paper currency.
As opposed to what? Carrying around gold bars?
Remind me again, what was used as currency in this country pre-1913?
Posted on 2/13/14 at 12:06 pm to LSURussian
quote:So then you advocate the slaughtering of women and children of governments who threaten the dollar?
More importantly, it's backed by the full strength of the U.S. military.
Not only do you advocate it, you seem to relish in it given your post.
Posted on 2/13/14 at 12:18 pm to goldennugget
quote:
I think that a lot of the economic problems we are facing are directly related to fiat currency and the federal resevere but I am wondering if anyone here thinks that fiat currency is a good thing
Nothing is wrong with a fiat currency it actually economizes the use of a commodity, you can gain interest from banks issuing the currency etc. The problem comes into play when you when have a monopoly issuing the currency as opposed to competing firms.
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