History Of FIAT CURRENCY Foretells '$' Destruction by out2theblack

Quote:
Originally posted by out2theblack:
Fiat Money = Toilet Paper Money

Hear, Hear.

Now if we could only get others on here to understand that unmutable fact. Like Signym, rue, and kwicko.

The ever-growing worthlessness of the fiat can be counterbalanced by economic growth, but that is only a temporary stopgap and it cannot last. This is why you're right that the current dollar is as much garbage as the contentials of the 1790's. The difference is that back then the american economy was teeny-tiny compared to it's size now, and our size is what keeps the dollar bouyed. Think of this in terms of "National Equity". When the government borrows against the fiat in amounts unimagined, and if the growth (the equity) isn't there to help sustain, the collapse is sudden and unstoppable. This is what happened in Zimbabwe. I said 2 weeks ago in the tea party threads that America's star as the worlds currency reserve is setting and will be replaced by China's unstoppable power.
17th century = Spanish
18th century = Dutch
19th century = English
20th Century = American
21st Century = Chinese
The core of the tea parties revolved around this issue and it's corollaries. Then the message was stained and twisted by ideologues from two directions.

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Tuesday, May 5, 2009 5:45 AM

I have a vote and I'm not afraid to use it!

"The ever-growing worthlessness of the fiat ..." happens b/c of concentration of money into fewer and fewer hands. If the currency supply stayed the same, by simple growth of the underlying economy, it would be worth more and more. In order to counteract money concentration and re-inject it at the bottom, one measure is to print more money or mint more coins. That is what makes currency of any kind worth less.

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Silence is consent.

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Tuesday, May 5, 2009 5:57 AM

*Sigh*
And so enters the socialist arguement which is ever flawed, focusing upon the drifting of wealth to the rich and demanding that the wealth be spread back out across the people like so much manure upon a farmfield. The socialist philosophers of the world all echo this as an ultimate truth while ignoring its repeated demonstrable failures.

The strength of the currency is the issue, not where it's differing component parts exist. You compare apples to oranges and work so very hard to make that orange look like an apple.

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Tuesday, May 5, 2009 6:04 AM

I have a vote and I'm not afraid to use it!

Voodoo economics - a term coined by GHWB to describe Reagan's polcies - is a demonstrable failure. So why do you still support it ?

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Silence is consent.

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Tuesday, May 5, 2009 6:27 AM

Quote:
I don't know if the euro has this feature but I believe at least for a while that the Deutsche Mark actually contained a silver thread sewn into it to keep it from becoming waste.

That's not a half bad idea, but there's a problem with that, you see - once you debase the currency far enough, folks start meltin it down!

And boy do the powers that be get pissed about it too!
http://www.usatoday.com/money/2006-12-14-melting-ban-usat_x.htm
http://www.thetrumpet.com/index.php?q=3170.1616.0.0
http://www.moneyweek.com/articles/money-morning/why-its-now-illegal-to
-melt-down-us-coins.aspx

Remember, I deal in metals, as one of the few viable methods of making enough to survive on after the frikkin Gov gets done robbing me, grr.

Hell, the only reason my fridge is well-stocked as of late is indirectly related to ammunition stockpiling, and I never thought I'd find myself more thankful to the damn Bosnians, but they did give us both Tomos and IGMAN, so warm fuzzies for the lot of em.
(And I'll even forgive them for the Yugo!)

Today's "dollar" is in my opinion, "Not worth a Continental!"
http://en.wikipedia.org/wiki/Continental_dollar
That being our first, idiotic and disastrous foray into the realm of fiat money, something Roger Sherman had already warned about previously in a handbill title "A Caveat Against Injustice"
http://www.rogershermansociety.org/caveat.htm

You will note, however - despite that handbill initially being his primary claim to fame, NO mention of it is made here.
http://en.wikipedia.org/wiki/Roger_Sherman
Which is of course, entirely deliberate.

Interesting historical stuff to this...

And at the Constitutional Convention he did all in his power to prevent the Federalists and their dreams of power from coming to fruition by suggesting a bi-cameral type of legislature and inserting a provision that he thought would pre-emptively forbid Fiat Currency, but of course he was unaware of Hamilton, Jay and Madisons plan to loophole and subvert the document before the ink was even dry, nearly carried out in full later by John Adams, which pissed off Hamilton cause he wouldn't "get with the program" and defer to Hamilton and his cronies, when he could have it all for himself, and Madison defected to Jeffersons side, completely horrified at the true nature of the Federalists was behind their weasel words - this lead to a schism within the Federalists between Hamilton and Adams, especially over Hamilton's more or less taking over the military and raising the "Standing Army" that Madison believed was the precursor to the destruction of liberty itself - and Adams compounded it with the midnight judges and the installment of Federalist John Marshall to the bench, which subverted much of the Constitutions intended protections by "re-interpreting" without check or balance, just like Patrick Henry warned would happen.

Side note: This also started Aaron Burr's rather clever maneuverings which on long study and perspective seem more a collective of chicanery and trickery set up to bait and sabotage the Federalists than anything else, and as such were extraordinarily effective.

As for Hamilton, such men tend to linger and cause damage far out of proportion to their own existence (See Also: Kissinger) if left to linger, so it's my opinion that Burr did our country a favor which will never be truly appeciated - especially since Hamilton, showing the true character of a Federalist, tried to impinge on Burr's character pre-emptively by suggesting in a statement he *knew* would become public if he died that he intended to not aim his first shot, which no one who knew him at the time believed in the slightest, and even Burr dismissed with a snort and the curt statement "Contemptible, if true."

Also, while not known at the time, and for a very long period after, also in the character of a true Federalist, Hamilton had brought a set of rigged duelling pistols with a hidden hair trigger, but elected not to use it in front of so many witnesses, thus likely the cause of his first shot going high.
http://en.wikipedia.org/wiki/Burr-Hamilton_duel

Burr, of course, meant to kill him from the outset, and having spent a great deal of research on the man I conclude that far from regret, his approach to Hamilton immediately following the shot was to finish the job, if he could, possibly by smothering before the witnesses arrived, but seeing the wound as obviously mortal there was no need of that, of course.

His later actions seemed mostly an extended baiting of the Federalists for the express purpose of their destruction, and if so, he did a right good job of encouraging them to destroy themselves.

Of course, history vilifies the man, but then, that's always how it goes, isn't it ?

Especially in a country stupid enough to honor a despot like Lincoln.

-Frem
It cannot be said enough, those who do not learn from history, are doomed to endlessly repeat it

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Tuesday, May 5, 2009 6:47 AM

Question ?

Has anyone ever thought of or used a currency with an expiration date, as in use it or lose it ?

Just one of them thunderbolt thoughts that might be worth chewing on a little, is all.

-F

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Tuesday, May 5, 2009 6:58 AM

Quote:
Originally posted by Fremdfirma:
Remember, I deal in metals,

Do you mean precious or scrap? I can converse in either but my industry involves ferrous stuff so I can REALLY talk scrap with a guy. I'm not in scrap, but I understand it better than the average bear.

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Tuesday, May 5, 2009 7:04 AM

I believe in solving problems, not sharing them.

BSCM: You claim that the idea of redistributing wealth is bogus but have not either logically or factually demonstrated it to be a problem. Nor have you demonstrated that concentrating wealth is a good thing.

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We should have strapped him into a glider, filled it nose heavy w/ explosives, and dropped his Allah lovin' ass into a large, empty field. After which, release wild boars into the area so they could make good use of his remains. Now THAT's justice.- rappy

Yeah, that's what Sheikh Issa said. Seems you both have a lot in common.- signy

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Tuesday, May 5, 2009 7:48 AM

Quote:
Do you mean precious or scrap?

Kinda both, you'd be amazed at what you can get out of "junk", and even more amused at the fact that folks pay me to haul it away!

Computer equipment is useful either way, as is office or electronic stuff - either I can recondition it for some possible use for RAWA, or various semi-political org, or scrap it down for base metals right down to the damn semiconductors and the circuit boards.
http://www.specialtymetals.com/electronics.asp

And what with recycle/disposal fees being what they are, and the equipment policies (as in, out of warranty = out the door!) of various companies, when some goon in a truck shows up and offers to "make it go away" for less than the 'recycler' (who is prolly doin the SAME thing!) they don't ask a lotta questions.

I generally choose raw form and have it struck to rounds, that used to be NWT but they've become real jackasses as of late, more concerned about covering thier ass than servicing their customers, and thus made the relationship unprofitable - seems they desire to have all their paperwork in order for the eventual seizure, so they can't get in trouble for not ratting out their clients and all - and guess who the cost of all that paperwork and recordkeeping gets passed on to ?

I also have some sides in facilitating getting metals to certain folk who speak Albanian from folk who speak English, and that has a little to do with ammunition manufacture and sales, of course.
(And no, I myself don't speak Albanian, good golly, my english is bad enough, innit !)

Also, there's precious and semi-precious uncut gemstones, which like anything else, I own outright - not points or shares in some "on paper" stone somewhere in a phony vault that doesn't really exist, the physical product, and in a location *I* have access to, rather than some asshole place that's gonna slam and lock the doors just when you actually NEED it - and then what will you do, get a battering ram ?

Same for the metal, unless it's "in-hand" it's bullshit, comex "gold" is just worthless paper and if the shit DOES hit the fan they'll not honor it anyhows.
http://news.silverseek.com/TedButler/1193161018.php

Of course, as I am also fond of pointing out, precious metal isn't so useful as currency to someone who has no need of it and thus will not take it, so I generally keep a decent stock of "trade goods" around as well - but the REAL value is something without weight, that needs no storage and cannot be stolen from you, only given freely... knowledge.

You might not convince a farmer to trade you some food for pretty rocks or whiskey, but if you can fix his tractor, on the other hand....

-F

EDIT: Toilet paper, hah, that's a good one, it's ALWAYS, ALWAYS been one of my trade goods, dating back to my army days, when I carried eight rolls of the damn stuff out on field deployments and sold it to the other idiots by the square - six rolls of cheap bare minimum stuff, and two rolls of comfy quilted luxury stuff, which true to stereotype, the officers bought more of than anyone else.
(And one LT got blackmailed over it by me, too!)

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Tuesday, May 5, 2009 8:00 AM

Quote:
Originally posted by SignyM:
BSCM: You claim that the idea of redistributing wealth is bogus but have not either logically or factually demonstrated it to be a problem. Nor have you demonstrated that concentrating wealth is a good thing.

The very basis of your message here demonstrates the fundemental difference twixt us. I wouldn't attempt to prove that concentration of wealth is either good or bad.

What I will debate is that the presence of controls that either promote or hinder wealth from either spreading or aggregating is not a positive influence on either american prosperity or the human condition. I say, and always say, to let the free market do what the free market always does: level the economic field to allow the better thinkers to improve the system.

I do however, bend to the knowledge that humanity is as capibable of evil as it is of initative. Therefore fundemental controls must exists to inhibit monoply or other economic abuses. This is what separates me from pure anarchists like Frem. The Anri-Trust laws of the early 1900's are certainly well placed. It may suprise you to know that there are other regulations I support as well, such as O's new drive to close some offshore tax havens.

But the subject of the thread was to be the value of the american fiat and why it always decreases. Rue would have us believe that it happens because the wealthy collect more fiat than the poor do. What a bizarre argument when the value of the fiat is meerly the value of the national equity behind it. Then came an evolution of debate away from fiat value to whether we should or should not spread the worthless fiat around.

I don't have to prove that wealth concentration is a "good" thing. I don't have to prove that redistrubution is a "bad" thing. What I have to do is prove that the free market is superior to nationalism for human prosperity. As always happens with a free market motavitated citizens use it to advantage to aggregrate wealth. So what? When you and Rue and others try to take that away, you are in a sense trying to fix what is not broken while breaking something else that is beautiful: Human Iniative. It's the fundemental lesson of Atlas Shrugged which you have said didn't impress you.

I become as passionate about violated economic freedoms when I debate with socialists as I do about violated personal freedoms when I debate with zelots and fundementalist christians Both guide humanity toward absolute, though differing, tyrannies. Imagine having to reside in the former soviet states where both were in play.

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Tuesday, May 5, 2009 8:08 AM

Quote:
Originally posted by Fremdfirma:
Quote:
Do you mean precious or scrap?

Kinda both, you'd be amazed at what you can get out of "junk", and even more amused at the fact that folks pay me to haul it away!

Dude, I know quite well what you describe. You must have done awsomely in 2008 when those prices spiked from June-August.

I managed to get my hands on some aluminum 1-1/2" eighth wall tubes and held them until July. Ended up getting $109 for them. An awsome haul for something a guy was gonna toss without a thought. Of course I was lucky, the 2008 spike couldn't have been predicted. Had I waited until August I might have gotten a little more, but by July I could tell that prices were just way to overvalued and a correction would be certain and sudden. I took what I could get and then watched with mild annoyance the arrival of the August peak followed by the sudden elevator-ride price plunge.

Browncoats forget that scrap rights were what caused the inital meltdown twixt Mal and Patience. Scrap is serious business.

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Tuesday, May 5, 2009 8:20 AM

Indeed I did, that's what financed the jump from Cabbie to Security - especially given the rabid level of taxation that was eatin me alive at the time, krishna onna crotch rocket, you think you folk get it hard, check out the tax bracket for an independant subcontractor without a single job exception and no wife or dependants.

-F

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Tuesday, May 5, 2009 8:37 AM

I have a vote and I'm not afraid to use it!

"But the subject of the thread was to be the value of the american fiat and why it always decreases. Rue would have us believe that it happens because the wealthy collect more fiat than the poor do."

Actually a misstatment of what I posted. The same thing happens WITH GOLD AND SILVER COINAGE. When Boston merchants and bankers had concentrated a large share of the wealth in the form of gold currency, there was not enough to go around. Farmers could not get loans to plant, small business could not get loans to open etc. While the very wealthy few were doing very well, the rest of the economy was sputtering to a halt. Deflation occured 1873-1896, including The Long Depression 1873 - 1879, and a major market crash in 1893 - a 23 YEAR LONG BUST CYCLE.

http://en.wikipedia.org/wiki/List_of_recessions
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And it all happened on the gold standard.

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Tuesday, May 5, 2009 8:54 AM

Rue, a certain quantity of tangibles or fiat play their role. I agree on this portion. But you neglect everything else. All things have a value. If a farmer from the 19th century produces 10 bushels of oats but there are not enough silver coins in circulation for him to aquire because mercantilists have thus horded them, he can certainly trade the oats for an ox. The oats have value. The ox has value. A trade occurs if both parties precieve an advantageous trade. These things happened all the time in the 19th century. Whole free markets were built around them. The famous Chicago Commodities Exchange was based around the wildly successful system (Thus the 2 sports teams in Chicago are the Bulls and the Bears in honor of the success of the market) They happen every day with every non-physical fiat exchange in our own time period. Is there enough physical fiat in play to pay for each and every transaction every day in the US? Surely not. That's why there is essentially an infiniate amount to the ceiling of it. As the overall macroeconomy grows, so does the "amount" of the intagible fiat. The critical mass moment occurs when the world market asks the question "Has the United stated borrowed more fiat from itself that is contained in the sum total of all of it's national equity?" Since the answer to the question remains "No" we chug along. But when the answer becomes "Yes"...well Chrisisall will see his favorite TV show become reality.

Life in the states will become alike to Dark Angel.

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Tuesday, May 5, 2009 8:56 AM

I believe in solving problems, not sharing them.

O2B- It's not that I think paper is inherently worth "something", it's just that gold is not necessarily any better. Ancient economies didn't necessarily pay or trade in gold. Sometimes currency was a simple as a cuneform tablet. The Romans paid in salt. Cyrean economies paid in silphium (a now extinct birth control herb) altho they used coin too.

Quote:
The seeds of the fickle fennel came into such high demand that they were eventually worth their weight in silver. The Roman government went so far as to store a cache of the herb in the official treasury

www.damninteresting.com/?p=851

All you have to do is google up "ancient currency" to come up with this list:
http://hubpages.com/hub/Funny-Money-Interesting-Ancient-Currencies

And just because an economy is based on gold doesn't prevent it from imploding nor does it prevent currency debasement. The reign of Louis XIV collapsed due to his incessant warmongering.
www.almc.army.mil/alog/issues/MayJun01/MS611.htm In this case, the state ran the banque and was the sole issuer of currency (gold coin). But when money started to run out, the state started issuing clipped coins... until they started coming back as tax payments! So even official gold and silver coins can be debased by coin clipping, which has occurred since precious metal coins were invented!

Anyway, my point is that a currency is only as sound as the economy behind it.

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We should have strapped him into a glider, filled it nose heavy w/ explosives, and dropped his Allah lovin' ass into a large, empty field. After which, release wild boars into the area so they could make good use of his remains. Now THAT's justice.- rappy

Yeah, that's what Sheikh Issa said. Seems you both have a lot in common.- signy

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Tuesday, May 5, 2009 9:02 AM

I believe in solving problems, not sharing them.

Quote:
If a farmer from the 19th century produces 10 bushels of oats but there are not enough silver coins in circulation for him to aquire because mercantilists have thus horded them, he can certainly trade the oats for an ox. The oats have value. The ox has value. A trade occurs if both parties precieve an advantageous trade.

But if this works so well, why are you so afraid of money losing its value? You still have a house- right? Your car- has value? Your skills- valuable, no? Stocks still have value? And if it DOESN'T work so well, then you cannot propose what is in essence barter as a logical alternative to currency, and must therefore pay attention to currency's distribution (or lack of).

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We should have strapped him into a glider, filled it nose heavy w/ explosives, and dropped his Allah lovin' ass into a large, empty field. After which, release wild boars into the area so they could make good use of his remains. Now THAT's justice.- rappy

Yeah, that's what Sheikh Issa said. Seems you both have a lot in common.- signy

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Tuesday, May 5, 2009 9:25 AM

Quote:
Originally posted by SignyM:
if this works so well, why are you so afraid of money losing its value? You still have a house- right? Your car- has value?

Well you just changed the conversation there, mahap without even knowing it. The currency is the vehicle of the trade in our modern world. The advent of the industrial age promoted it. Debase the currency and risk reverting to the pre-industrial world. Aka Dark Angel.

It's difficult to describe these truths to a person who has already admitted a belief that businesses and free currencies promote dystopia. It's why I asked you if you're an anarchist. I know people in my libertarian circles that are. I've heard all the arguments about how we should ignore the value of any currency and live our lives like star trek. That cannot work unless the overwhelming majority of the population becomes enlightened which will never happen. The human species is hardwired to hoard and survive. Only a scant few can rise above it with thought.

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Tuesday, May 5, 2009 9:42 AM

I believe in solving problems, not sharing them.

I thought that I was simply using your logic about the famer and his oats. You tried to portray currency as being irrelevant (in that case) but relevant (in others cases).

My point is that its not the currency which makes the economy strong, but the other way around: It is the economy which makes the currency valuable. If you have a productive economy and people have to come to your for your goods, your currency can be cowrie shells and people will value them ... not because cowrie shells have intrinsic value but because those shells gain people access to goods they couldn't otherwise get. Now that the USA is no longer the predominant economy (no longer the sole post-war industrial producer)... now that other nations have similar industial technologies and productivities ... the currency will adjust to match.
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We should have strapped him into a glider, filled it nose heavy w/ explosives, and dropped his Allah lovin' ass into a large, empty field. After which, release wild boars into the area so they could make good use of his remains. Now THAT's justice.- rappy

Yeah, that's what Sheikh Issa said. Seems you both have a lot in common.- signy

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Tuesday, May 5, 2009 9:42 AM

I have a vote and I'm not afraid to use it!

"As the overall macroeconomy grows, so does the "amount" of the intagible fiat."

SignyM asked in different form a question that is relevant to that point. Here is the question, in my framing: find me an economic system (past or present) where the currency has become critically unstable, and where the PEOPLE thrive anyway due to intangible fiat, and barter.

***************************************************************

Silence is consent.

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Tuesday, May 5, 2009 11:02 AM

Quote:
Originally posted by SignyM:
I thought that I was simply using your logic about the farmer and his oats. You tried to portray currency as being irrelevant (in that case) but relevant (in others cases).

No. In context was responding to Rue's proposition that fiat loses value because wealthy citizens hoard it. When I refuted this Rue attempted to demonstrate a 19th century example of horded coinages to which I pulled out the farmer and his oats to show how everything has value and the physical presence of a coin might facilitate the ease of a 19th century transaction, but that a transaction might still occur without it, thus the glory days of Chicago. This was to set up an understanding of the state of things today where the overwhelming majority of transactions occur in this manner. I am not paid in my salaries proated weekly value in silver coins handed to me in a bag at the end of a work week. I get a direct deposit of electronic fiat into a checking account.

This fiat is a numerical representation of what my knowledge and skill is worth in the marketplace. I would say it's worth more, my employer would say less. We meet at my salary. This represents one transaction. The sum total of all other identical transactions of pay plus the sum total of all purchases by all citizens of the nation plus the sum total of all assets owned by all citizens equals X, a sum called the National Equity. If the total debt obgliation of the nation exceeds X, there will be a problem. As long as the total national equity grows and stays larger than the obligation, the nation can continue to borrow all it wants. When the day comes that the debt is larger than the equity, the nation will falter but the house of cards can continue to climb until the moment the intrest on the debt cannot be paid by the sum of the equity. That will be the moment of absolute economic collapse. You often ask for real world examples. Look to Zimbabwe. Their national equity was already small because they were a third world nation. Their borrowing was no place near as large as the US's but in scale to their equity it was bad enough. The absolute collapse of their currency created a Mad Max 4th world country. Somalia is very close to this. It might as well be Lord Humguous telling the pirates to raid shipping vessels.

Quote:
My point is that its not the currency which makes the economy strong, but the other way around: It is the economy which makes the currency valuable.

Well then you and I actually agree because this is exactly what I'm saying when I describe National Equity. The equity (the economy as you say) is half of the calculation, the obgliation (National Debt) is the other. If you really feel that the economy makes the currency valuable (and I agree), then I cannot reconcile that with your belief that business promotes dystopia when it's business itself that IS the economy.

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Tuesday, May 5, 2009 11:43 AM

I believe in solving problems, not sharing them.

Quote:
when it's business itself that IS the economy.

There were economies before there were businesses. All of this gets to: What is an economy and what do we want it to do?

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We should have strapped him into a glider, filled it nose heavy w/ explosives, and dropped his Allah lovin' ass into a large, empty field. After which, release wild boars into the area so they could make good use of his remains. Now THAT's justice.- rappy

Yeah, that's what Sheikh Issa said. Seems you both have a lot in common.- signy

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Tuesday, May 5, 2009 11:59 AM

I have a vote and I'm not afraid to use it!

"In context was responding to Rue's proposition that fiat loses value because wealthy citizens hoard it."

You still have a FUNDAMENTAL error in answering what I posted. I said it would happen with ANY currency, not just fiat.
ANY ANY ANY ANY ANY ANY ANY ANY ANY ANY ANY ANY
Got that ? ANY currency - including gold coins.

"When I refuted this Rue attempted to demonstrate a 19th century example of horded coinages ..."

I did more than attempt. I showed a real life example - on the GOLD STANDARD.

"... to which I pulled out the farmer and his oats ..."

Aside from being a HYPOTHETICAL one, you have a fundamental misunderstanding of how the CBOT operates. "Trades are made in the pits by bidding or offering a price and quantity of contracts, depending on the intention to buy (bid) or sell (offer)." Trades are made in currency denominated value. NO ONE directly trades oats for a mules, or anything else.

I challenged you to show me a real life example of how people can thrive on physical fiat and barter when the currency is unstable. You have yet to show that it works.

***************************************************************

Silence is consent.

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Tuesday, May 5, 2009 12:13 PM

Quote:
Originally posted by rue:
You have a fundamental misunderstanding of how the CBOT operates.

For statement like that from a socialist to a liberty activist, those may as well be fighting words.

You might as well say "Hey you know...your coat is kind of a brownish color" To which I might be inclined to reply that I didn't think you were burdened with an overabundance of schooling.

Hypothetically.

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Tuesday, May 5, 2009 12:22 PM

I believe in solving problems, not sharing them.

But you haven't answered Rue's question. (Or mine either for that matter!)

Anyway, I'm sure you're busy. Be happy to get back with ya on that.

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We should have strapped him into a glider, filled it nose heavy w/ explosives, and dropped his Allah lovin' ass into a large, empty field. After which, release wild boars into the area so they could make good use of his remains. Now THAT's justice.- rappy

Yeah, that's what Sheikh Issa said. Seems you both have a lot in common.- signy

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Tuesday, May 5, 2009 12:25 PM

I have a vote and I'm not afraid to use it!

BSC

Show me - using facts - that traders at the CBOT trade one type of good directly for another - without an intervening currency-denominated value.

So, to recap -

You put the blame for all economic misery on fiat currency.

I showed that there was plenty of economic misery on the gold standard.

You then claimed that people could thrive on physical fiat and barter, but have yet to post an example of your own that demonstrates what you claim.

I said that economic misery could be attributed to concentration of wealth.

I posted a real life example of how that happens (even on the gold standard).

You have yet to show that that your preferred system (presumably capitalism and the gold standard) is robust enough to be self-sustaining.

***************************************************************

Silence is consent.

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Tuesday, May 5, 2009 3:59 PM

From an external viewpoint, I don't think y'all realize just how MUCH in agreement on the basic roots (if not the details) that you really are.

Maybe you should work from that end instead of the other ?

Just a thought.

-F

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Tuesday, May 5, 2009 4:38 PM

ANTHONYT

Freedom is Important because People are Important

Hello,

If there are a finite number of coins, X

And people hoard Y number of them

Doesn't that make the value of each remaining coin X-Y

Greater?

And hence escalate the value of currency?

--Anthony

"Liberty must not be purchased at the cost of Humanity." --Captain Robert Henner

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Tuesday, May 5, 2009 6:11 PM

"We'll know our disinformation program is complete when everything the American public believes is false." -- William Casey, Reagan's presidential campaign manager & CIA Director (from first staff meeting in 1981)

Quote:
Originally posted by bluesuncompanyman:
Quote:
Originally posted by out2theblack:
Fiat Money = Toilet Paper Money
Hear, Hear.

Now if we could only get others on here to understand that unmutable fact. Like Signym, rue, and kwicko.

I think the word you're looking for is "immutable".

And I think you have me mistaken for somebody else. I'm putting my spare "toilet paper" into things I can actually USE if it all goes to hell: guns, ammo, and toilet paper. :) Maybe not as popular as gold, but every bit as useful if society collapses around your head and the gold exchange is in flames...

Hell, I work for a living. I need every scrap of that fiat money I can get my hands on right now. Is it the best system going? Dunno. Probably not. On the other hand, if you find the current money so worthless... can I have all yours? I'd love to see a system where our money is backed by something more than our reputation in the world, especially the way that reputation has been squandered in a post-9/11 world. If you've got a plan, then as Obama might say, "I'm all ears."

And just for snark's sake:

Isn't "FIAT money" what we're going to be using to buy Chryslers in a couple weeks?

Mike

Build a man a fire and he'll be warm for a day...
Set a man on fire and he'll be warm for the rest of his life.

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Tuesday, May 5, 2009 6:23 PM

Quote:
And so enters the socialist arguement which is ever flawed, focusing upon the drifting of wealth to the rich and demanding that the wealth be spread back out across the people like so much manure upon a farmfield.

Pardon me, but I'm very late to this discussion, and am still catching up, and responding to things as I read them...

BSCM, to keep with your analogy, you're focusing upon the wealth not as manure to be spread across a farm field for fertilizer to help the crops grow, but rather as heaping it all together in one place. All you end up with that way is a big steaming pile of shit just sitting there rotting.

I think Rue's argument is that you can't maintain economic growth without printing (or minting) more money UNLESS you distribute at least a goodly portion of that money back down to the bottom levels, where it will once again begin it inexorable trickle back up the ladder to the top. And for that matter, you can't even maintain an economic plateau and keep things stable at a sustainable level unless you also do this. That doesn't mean we're taking away your precious lucre at gunpoint or through "socialist" programs - it means if a capitalist pays a living, fair wage, his workers will have more money to spend on his products, and he'll still make a fair profit. When you devalue labor and inflation kicks the prices sky-high, only the capitalists at the top can afford the things they pay others to produce.

And if anyone thinks the world would collapse without those capitalist investors and owners, I'd ask them to consider what would happen to those factories and stores without workers and customers. It's not a sin, and it's not a "socialist" belief to imagine that workers and customers are as valuable to an economic system as are owners and investors.

At least, that's my take on it, simplified and boiled down.

Mike

Build a man a fire and he'll be warm for a day...
Set a man on fire and he'll be warm for the rest of his life.

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Tuesday, May 5, 2009 6:27 PM

Quote:
Posted by Fremdfirma:

...I never thought I'd find myself more thankful to the damn Bosnians, but they did give us both Tomos and IGMAN, so warm fuzzies for the lot of em.
(And I'll even forgive them for the Yugo!)

And on a lighter note...

You did know that during the recent troubles in the former Yugoslavia, U.S. airstrikes completely obliterated the Yugo factory, right?

Damage estimates ran as high as seven dollars.

You know how to double the resale value of a Yugo?

Fill up the gas tank.

You know why Yugos have rear-window defrosters?

So you can keep your hands warm while you're pushing it.

Mike

Build a man a fire and he'll be warm for a day...
Set a man on fire and he'll be warm for the rest of his life.

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Tuesday, May 5, 2009 6:43 PM

Quote:
But the subject of the thread was to be the value of the american fiat and why it always decreases. Rue would have us believe that it happens because the wealthy collect more fiat than the poor do.

Economics is absolutely NOT my forte, so maybe you need to put this in cap'n-dummy talk. Asking why the value of money always decreases is the same as asking why the prices of goods always increases, isn't it?

And would the value of the money decrease if there were a set amount in circulation, and no more? Or would it hold steady or even increase a bit due to its now "limited" availability.

Seems to me printing more of it drives down the worth of what's already out there, which in turn causes prices to go up, which means I now need more of it, so I demand a raise, as does everyone else, and the fed decides to print more money to feed the beast. And so the cycle starts all over again. Inflation-adjusted, I'm actually making less than I was 10 years ago, even though I'm making more in terms of actual dollars earned. It just buys less now. Of course, an ounce of gold then cost less than it does today, but if you sold it to buy something, my bet is you'd still end up with the same purchasing power from that gold.

I'm just sayin'.

Like I say, I don't pretend to get economics. One thing I have learned, though, is that while it's fun to say "soak the rich" and "screw the rich", when it happens, it's always the poor who get hurt so much more. If you have a billion dollars and lose 90% of it, you've still got a hundred million; you'll probably be okay. You're not missing too many Happy Meals. If you've got a thousand dollars to your name and lose 90% of it, you're pretty well screwed. If you've got a hundred to start with, you're worth more dead.

Anyhoo... It's late, I'm rambling, and I'm off to bed.

Mike

Build a man a fire and he'll be warm for a day...
Set a man on fire and he'll be warm for the rest of his life.

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Tuesday, May 5, 2009 6:52 PM

Quote:
I've heard all the arguments about how we should ignore the value of any currency and live our lives like star trek. That cannot work unless the overwhelming majority of the population becomes enlightened which will never happen. The human species is hardwired to hoard and survive. Only a scant few can rise above it with thought.

Dang, and here I was almost in bed... and I had to keep reading!

BSCM, if this is true, then you're fighting a battle you've already lost. You're trying to "enlighten" us, while admitting that the overwhelming majority of the population can never be enlightened. If that's so, why waste your time?

And if hoarding is inevitable, then it doesn't matter what your currency is backed with, because once one person has hoarded it all, then in a very real sense it's worthless to everyone else, because they have none, and it's worthless to the one who has it all, because there's nothing more he needs that can be bought with this currency. Others will have moved to something else that they can trade amongst themselves as currency.

Mike

Build a man a fire and he'll be warm for a day...
Set a man on fire and he'll be warm for the rest of his life.

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Tuesday, May 5, 2009 7:00 PM

Quote:
You often ask for real world examples. Look to Zimbabwe. Their national equity was already small because they were a third world nation. Their borrowing was no place near as large as the US's but in scale to their equity it was bad enough.

So I have to ask, by way of clarification, and not just to be dickish...

Do you have the same problem with corporations borrowing these huge piles of "not-money", or is it just governments do it that it grinds your gears?

Reason I ask is, some of the Wall Street giants had borrowed, through their sale and use of CDOs and CDSs, far more than the GDP of the U.S., far more than the value of the entire U.S. stock market, and far more than the national debt. Doesn't this enormous debt of "fiat money" further teeter the U.S. economy over the brink, or is this what has been holding us all up for the last several years?

Mike

Build a man a fire and he'll be warm for a day...
Set a man on fire and he'll be warm for the rest of his life.

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Tuesday, May 5, 2009 10:01 PM

Quote:
Isn't "FIAT money" what we're going to be using to buy Chryslers in a couple weeks?

Ouch, that's downright painful...

I place Fiat in the same quality category as Renault, which gave us one of the worst cars in history, the Renault Alliance.

My mother bought one of those shitheaps on the reccommendation of (bought and paid for) outstanding "reviews" in auto mags, and it spent so much time in the shop the neighbors thought the dealer loaner WAS our car, and it being an Alliance as well, THAT broke down twice and they had to bring us ANOTHER loaner while they fixed that heap too.

http://www.caranddriver.com/reviews/hot_lists/high_performance/best_wo
rst_lists/dishonorable_mention_the_10_most_embarrassing_award_winners_in_automotive_history_feature

Then there was "Le Carcass", which was a Renault Le Car a friend got on the cheap from a junkyard, which more or less came apart four days later in the parking lot of the school, and remained there all year - for all I know the damn thing is STILL there.

Fiat's the same crap, and while I wouldn't mind getting my hands on a Fiat 500R, the hell if imma pay 20k for a piece of shit worth maybe 4k.

All I need is a tiny little box with an engine in it to carry groceries anyhows, yanno ?

Oh, and I did once get to drive a Yugo, a fellow trooper was backing out of a parking spot in the PX after drill, and the gearshift snapped out of place with such velocity that it broke her arm quite badly - and I wound up having to drive that little horror for her, one hand FIRMLY holding that damn gear lever in place the whole time.

Apparently that was a common occurance with them, and later the plant was converted to making Ak-47's, which is why it was bombed, but given the average quality of THAT plant, and the likelyhood they could even screw up a Kalishnikov (and that AIN'T easy!) we prolly did em a favor.

Tomos quality has gone downhill ever since they replaced the Golden Bullet and it's indestructible A3 engine with the crappy A5 and even worse A55 in current use - one of the ways they saved money was replacing the real clutch pads (70,000 miles) used in the A3 with three tiny little strips of CORK, yes, corkboard cork (4,000miles, IF that) in the A5 engine.

They also cut the gear teeth square, dead on instead of angled like the A3 which increased wear and tear and shifts quite poorly when you're depending on those clutches and tiny strips of chewed up cork in a damn centrifugal clutch.

And of course, a lighter, but far more fragile piston with wispy-thin rings that don't last for shit - the only benefit the A5 had was a reed valve, and you could retrofit an A3 with one by using an A3N intake, or the custom side mount I use to avoid having to drop the whole damn engine to tune the carb or change jets.

Just for reference, so you get an idea of the insanity of tuning on these little bitty things - here's two vids of a hot rodded Puch Maxi with the Metrakit, bear in mind that I can catch that with a Tomos Airsal despite him having 10cc's on me, cause his HP is mostly at the bottom, and mine are all at the top.

-F

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Wednesday, May 6, 2009 1:47 AM

Fremmie, if you need a box to haul groceries with, and you like the Smart ForTwo, I've got just the thing for you. May I present the Smart Diablo...

Enjoy.

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Wednesday, May 6, 2009 5:08 AM

Quote:
Originally posted by Kwicko:
I think the word you're looking for is "immutable".

"An F in English? But that's unpossible!" - Ralph Wiggum

Color me blessed to be the beneficiary of professor Kwicko's red pen.

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Wednesday, May 6, 2009 7:23 AM

Quote:
Originally posted by bluesuncompanyman:
Quote:
Originally posted by Kwicko:
I think the word you're looking for is "immutable".
"An F in English? But that's unpossible!" - Ralph Wiggum

Color me blessed to be the beneficiary of professor Kwicko's red pen.

I love Ralphie Wiggum!

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Wednesday, May 6, 2009 10:09 AM