Who owns the Federal Reserve Bank?

[Truth-Bringer]

OK. Now describe any economic system that is not a fiat currency system. Gold? Gold coins have value because someone says they have value, not because a gold coin has any intrinsic value.

Precious metals have historically held their value over time. Gold has always had value as jewelry. And due to its superior conductivity, it is used in computers, telephones (cell phones also) and other electronic products. Here is a brief article on the uses of gold:

http://www.nma.org/about_us/publications/pub_gold_uses.asp

Gold has value BEYOND its use as money. Get it? The paper/fabric federal reserve notes are virtually worthless if the legal tender laws didn't exist. Government is disrupting the voluntary choice of what is or isn't valuable by the use of force. That's why it's not a true test of actual value.

There is no difference between a person or an entity stating that a gold coin has X value and a person or entity stating that a piece of paper has X value.

Now we get to the root issue: The government passes legal tender laws and then FORCES you, at gunpoint if necessary, to accept worthless paper as money. It eliminates freedom in the market place. There is no difference to an entity VOLUNTARILY assigning value to something, but the government isn't doing this VOLUNTARILY. It's forcing people to do what it wants them to do and denying them the right to make a peaceful, honest, voluntary choice of their own.

Pwned again, Shetland pony rider.

Again I ask you, how and why decision to stop publishing the M3 Money Multiplier is important to you in your daily life and how does it effect your ability to live as you have become acustomed.

I've already explained it, moron. You seem to be incapable of even the most basic reading comprehension skills.

 

[Truth-Bringer]

Then humor me. Bring forward a point that you made and my response and describe how it constitutes a strawman argument.

One example - Go to the 7th post down on the third page. Are you blind or something?

Saying a thing doesn't make it true.

I know - so you need to stop doing that and wake up from your delusional fantasy world.

 

[palerider]

Precious metals have historically held their value over time. Gold has always had value as jewelry. And due to its superior conductivity, it is used in computers, telephones (cell phones also) and other electronic products. Here is a brief article on the uses of gold:

I know all about gold, thank you. I made my living fashioning it into objects of art and desire for a large number of years... Gold has had value because someone said that it had value, not because it has any intrinsic value. Further, gold has gone through value fluctuations that were great enough to cause havoc in any system that was reliant on it for currency stability.

I have been buying gold coins for the past 30 years and have seen their value rise and fall to a degree that if I were trying to live my daily life on a system in which the value of gold decided the value of everyting else, it would have been chaos.

Gold has value BEYOND its use as money. Get it? The paper/fabric federal reserve notes are virtually worthless if the legal tender laws didn't exist. Government is disrupting the voluntary choice of what is or isn't valuable by the use of force. That's why it's not a true test of actual value.

Gold has value because someone says it has value. There is nothing that can be done with gold that can't also be done with other metals. Gold's value is not intrinsic and therefore its value as the basis for an economic system is no more valid than any other material or idea for that matter.

Now we get to the root issue: The government passes legal tender laws and then FORCES you, at gunpoint if necessary, to accept worthless paper as money. It eliminates freedom in the market place. There is no difference to an entity VOLUNTARILY assigning value to something, but the government isn't doing this VOLUNTARILY. It's forcing people to do what it wants them to do and denying them the right to make a peaceful, honest, voluntary choice of their own.

So, if the government switched back to the gold system, they would pass new currency laws and force you at gunpoint if necessary to accept the new basis for the economy. How is that different? Changing the basis of our economy still involves forcing everyone to accept it. Or are you trying to advocate a system in which every individual gets to decide what is valuable and use that as a monetary unit if he can find someone else who will accept it as a moneary unit?

Pwned again, Shetland pony rider.

You have yet to prove any point, much less own me.

I've already explained it, moron. You seem to be incapable of even the most basic reading comprehension skills.

No you didn't, you erected a strawman about the chinese effect on our economy that you later said had nothing to do with the fed.

 

[palerider]

One example - Go to the 7th post down on the third page. Are you blind or something?

You said:

"The Federal Reserve has created a danger for us in this situation because it has usurped our Constitutional monetary system. China would not be a financial threat to dump our dollars if our money had intrinsic value, because there would be no threat of a sell off. Nor would our markets rely on floating currency overseas to bolster the value of it - it would have intrinsic value, as precious metals have always historically had"

I replied:

"Metals have no intrinsic value. Intrinsic - belonging to a thing by its very nature. Gold doesn't have worth because it is gold, gold has worth because someone says it has worth."

Then in a later post, I elaborated:


"I know all about gold, thank you. I made my living fashioning it into objects of art and desire for a large number of years... Gold has had value because someone said that it had value, not because it has any intrinsic value. Further, gold has gone through value fluctuations that were great enough to cause havoc in any system that was reliant on it for currency stability.

I have been buying gold coins for the past 30 years and have seen their value rise and fall to a degree that if I were trying to live my daily life on a system in which the value of gold decided the value of everyting else, it would have been chaos."


OK. Now describe how those responses to your point represent a strawman.

 

[Truth-Bringer]

You said:


OK. Now describe how those responses to your point represent a strawman.

ROTFLMAO!!!! You just put another Straw Man on top of a Straw Man by attacking the wrong quote... Hilarious. That was not what I was referring to on the 7th post down on the third page. YOU ARE EITHER COMPLETELY STUPID OR A LYING FRAUD. WHICH IS IT?

Let's go through this so you won't get confused. I have to treat you like a freakin' three year old...

(1) - I posted: "I'll give you another potential problem - China. As I stated earlier, look at what happened to our stock market (dropped over 500 points) when China's Shanghai Composite fell nearly 9%. The sell off spread to the European markets and continued on to the U.S. The bottom line is that they're a potential enemy, holding enough of our currency and our debt to fasciliate a problem should they decide to dump massive amounts of dollars or refuse to continue financing us."

(2) - You replied: "And how is the federal reserve to blame for that? And do you credit the federal reserve for the quick rebound? If they aren't responsible for the rebound, how were they responsible for the drop?"

(3) - I replied: "Another Straw Man. My position was not that the Federal Reserve caused that change in the stock market, you moron. I presented that statement as evidence that Chinese markets already have a huge, potentially negative influence over our own.

The Federal Reserve has created a danger for us in this situation because it has usurped our Constitutional monetary system. China would not be a financial threat to dump our dollars if our money had intrinsic value, because there would be no threat of a sell off. Nor would our markets rely on floating currency overseas to bolster the value of it - it would have intrinsic value, as precious metals have always historically had."

YOU ARE ARGUING AGAINST THE STOCK MARKET DROP WHICH HAS NOTHING TO DO WITH THE FEDERAL RESERVE. My only point in posting that anecdote was to show the sway the actions of their economy have over our own, but the real danger is:

"The big sword overhanging the U.S. economy...is the willingness of foreign bond holders (China) to hold U.S. debt." - The Vancouver Sun, Jan. 29, 2004

"All Beijing has to do is to mention the possibility of a sell order going down the wires. It would devastate the U.S. economy more than any nuclear strike." - Asia Times, Jan. 23, 2004

If China were to dump all our dollars and sell all the debt they acquired through our central bank, we'd be toast - AND THAT CONDITION EXISTS BECAUSE WE HAVE A CENTRAL BANK AND FIAT CURRENCY. That's the point.

 

[Truth-Bringer]

Further, gold has gone through value fluctuations that were great enough to cause havoc in any system that was reliant on it for currency stability.

Produce and present evidence of your claim. In many cases perceived fluctuations were due to government intervention. For example, when monetary problems hit Rome because taxes could go no higher without revolution, the government began clipping or shaving the edges off the Denarius when they came into the treasury, and then minted new coins from those clippings. Of course, people caught on to the counterfeiting deception rather quickly, and inflation was the result. People wanted more of the clipped coins for the same products/services.

This is where reeding coins came from - cutting notches into the edges of coins. This allowed anyone to see if the coin had been clipped or not. Of course, the government was only pretending to be honest and they came up with a new deception to bypass this - debasing the currency. In 54 A.D. a Denarious was 94% silver, by 218 A.D. it was only 43% silver and 50 years later it was less than 1%. Look at the U.S. half dollar in comparison. In 1964 it was 90% silver. Five years later it was down to 40%. Today it contains no silver.

These policies do not foster public confidence - either in the currency or the integrity of the politicians. More reasons why can be found at:

http://www.buildfreedom.com/tl/rapecon.shtml

I have been buying gold coins for the past 30 years and have seen their value rise and fall to a degree that if I were trying to live my daily life on a system in which the value of gold decided the value of everyting else, it would have been chaos.

Dealing with numismatic coins in the present system is a little different than just the base metals. Regardless, gold has been steady throughout history. And as the following chart shows, it has retained its value IN RELATION TO ALL THE OTHER MAJOR CURRENCIES, and that's the only standard we're discussing here:

http://www.gold-eagle.com/editorials_04/greene032104.html

Gold has value because someone says it has value. There is nothing that can be done with gold that can't also be done with other metals. Gold's value is not intrinsic and therefore its value as the basis for an economic system is no more valid than any other material or idea for that matter.

Again, you are ignoring my argument that there is a difference between a VOLUNTARY assignment of value and a FORCEFUL assignment of value. You don't have to accept a value someone tries to persuade you to accept, but if your life, freedom, safety, etc. is on the line, the value is not voluntary.

Would it be moral and ethical in your opinion for someone with a gun to threaten you will jail time if you refused to pay $100 for a piece of chewing gum just because they had the legal authority to arbitrarily change the value of chewing gum?

So, if the government switched back to the gold system, they would pass new currency laws and force you at gunpoint if necessary to accept the new basis for the economy.

Here you finally have a point, but you're still not entirely correct. I like the gold standard obviously, but I would advocate a Constitutional amendment that allows people to use other currencies if they so desire. That is compatible with Natural Law. The only Constitutional Amendments that should be allowed are those that expand freedom and inalienable rights. So, while the Constitution is clear on the matter, I would push for an amendment to allow people the right to choose other currencies. In a strictly Constitutional view, we couldn't even expand to platinum and palladium, which is contradictory since both those metals would also have instrinsic value and all the other monetary properties found in gold and silver.

How is that different?

Again, you have a point but it's still technically different because:

Number one, gold and silver have intrinsic value - they have value OTHER THAN BEING JUST CURRENCY - which federal reserve notes DO NOT HAVE. Gold and silver will be desired without legal tender laws - paper/fabric currency would not be desired.

Number two, the government will not be able to induce inflation if we return to gold and silver with strict minting/value rules:

"By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose." - John Maynard Keynes, The Economic Consequences of the Peace, 1920.

Keynes mistakenly turned his back on the gold standard, but his quote above shows that he understands the process of inflation. Keynes did not view an unlimited printing of fiat currency as a cure for recessions and depressions. He may have advocated such means temporarily, but he was well aware of what the long term consequences would be: negative. Governments should not have the power to print money at will. And there was no such allowance in the original intent of the Constitution.

Changing the basis of our economy still involves forcing everyone to accept it. Or are you trying to advocate a system in which every individual gets to decide what is valuable and use that as a monetary unit if he can find someone else who will accept it as a moneary unit?

Every individual should be free to choose, yes, but they would quickly move to a common standard once they found something that was STABLE AND COULDN'T BE MANIPULATED BY THE GOVERMENT. It's why digital currencies like http://www.e-gold.com have become very popular. Of course, it's only a matter of time before the government threatens them, as they just did to the creator of the silver Liberty Dollar:

'Liberty Dollars' Can Buy Users A Prison Term, U.S. Mint Warns

"So says the U.S. Mint, which would like to remind Liberty Dollar users that since the United States already has its own currency, the only thing Liberty Dollars buy in these parts is a jail term."

http://www.washingtonpost.com/wp-dyn/content/article/2006/10/09/AR2006100900993.html

You have yet to prove any point, much less own me.

LOL. Oh, you've been pwned numerous times. The next time someone asks you if you own yourself, tell them "No, Truth-Bringer pwns me."

No you didn't, you erected a strawman about the chinese effect on our economy that you later said had nothing to do with the fed.

Didn't happen. For the reasons I've already posted. Put down the Kool Aid and wake up from nappy, nappy time.

 

[Truth-Bringer]

To describe my point in my own words as to why failing to publish the M3 Money Multiplier constitutes a danger sign:

In a fiat currency system, such currency only has value due to two things - domestically due to the legal tender laws - which force people, at gunpoint if necessary, to use such currency to pay all public and private debts. If the legal tender laws were repealed tomorrow, NOBODY with half a brain would use federal reserve notes because they're intrinsically worthless.

Internationally, a fiat currency only has value so far as foreign governments or citizens desire it. Since the U.S. was once seen as strong, stable and financially sound, the dollar became the international currency of choice. Now, those perceptions are slowly vanishing. Everyone knows we're leveraged to the hilt, and they know foreign debt and currency holders are propping us up.

Inflation is created solely by government action, as Milton Friedman proved prior to winning the Nobel Prize in economics. The Fed governors when once vehemently opposed to his findings, but now they agree with and have accepted his conclusions. (They're willing to compromise since they want to keep this system that's profiting them so greatly going indefinitely...) Since the value of the dollar in such a system is determined in part by how many dollars are in circulation, by refusing to publish the M3 money multiplier, our government is telling other governments "We're not going to tell you how much money we're printing anymore." Obviously, the implication is "we're going to have to print a lot more money that we don't want you to know about." Such an implication does not breed confidence among foreign central banks. They will slowly begin to sell off their dollar holdings in favor of more stable currencies.

No challenge to this one, Shetland pony rider? You can't just ignore what you don't like now...

 

[palerider]

YOU ARE ARGUING AGAINST THE STOCK MARKET DROP WHICH HAS NOTHING TO DO WITH THE FEDERAL RESERVE. My only point in posting that anecdote was to show the sway the actions of their economy have over our own, but the real danger is:

So if the stock market drop has nothing to do with the federal reserve, why did you inject the chinese and the stock market drop into the discussion?

"The big sword overhanging the U.S. economy...is the willingness of foreign bond holders (China) to hold U.S. debt." - The Vancouver Sun, Jan. 29, 2004

"All Beijing has to do is to mention the possibility of a sell order going down the wires. It would devastate the U.S. economy more than any nuclear strike." - Asia Times, Jan. 23, 2004

These quotes that you keep bringing here don't represent anything more than someone's opinion. They are not proof of your postion.

If China were to dump all our dollars and sell all the debt they acquired through our central bank, we'd be toast - AND THAT CONDITION EXISTS BECAUSE WE HAVE A CENTRAL BANK AND FIAT CURRENCY. That's the point.

I have asked you to describe a currency that would not be a fiat currency. By definition, any currency is a fiat currency is one that has a value because someone says it has value and those who use the currency agree.

 

[vyo476]

Um...I'm pretty sure I never said that. I mean in the literal sense of those words that you attributed to me having never been posted on this forum by me. Probably just a quotation error but if it isn't I'd love to know who hacked my account.

 

[palerider]

No challenge to this one, Shetland pony rider? You can't just ignore what you don't like now...

I answered that one.

Originally Posted by Truth-Bringer
In a fiat currency system, such currency only has value due to two things - domestically due to the legal tender laws - which force people, at gunpoint if necessary, to use such currency to pay all public and private debts. If the legal tender laws were repealed tomorrow, NOBODY with half a brain would use federal reserve notes because they're intrinsically worthless.

I answered:

OK. Now describe any economic system that is not a fiat currency system. Gold? Gold coins have value because someone says they have value, not because a gold coin has any intrinsic value. There is no difference between a person or an entity stating that a gold coin has X value and a person or entity stating that a piece of paper has X value.

Again I ask you, how and why decision to stop publishing the M3 Money Multiplier is important to you in your daily life and how does it effect your ability to live as you have become acustomed.

To the rest:

Internationally, a fiat currency only has value so far as foreign governments or citizens desire it. Since the U.S. was once seen as strong, stable and financially sound, the dollar became the international currency of choice. Now, those perceptions are slowly vanishing. Everyone knows we're leveraged to the hilt, and they know foreign debt and currency holders are propping us up.

Is your argument that we couldn't also be "leveraged to the hilt" if our currency was backed by gold?

Inflation is created solely by government action, as Milton Friedman proved prior to winning the Nobel Prize in economics. The Fed governors when once vehemently opposed to his findings, but now they agree with and have accepted his conclusions. (They're willing to compromise since they want to keep this system that's profiting them so greatly going indefinitely...) Since the value of the dollar in such a system is determined in part by how many dollars are in circulation, by refusing to publish the M3 money multiplier, our government is telling other governments "We're not going to tell you how much money we're printing anymore." Obviously, the implication is "we're going to have to print a lot more money that we don't want you to know about." Such an implication does not breed confidence among foreign central banks. They will slowly begin to sell off their dollar holdings in favor of more stable currencies.

Inflation can be caused by a myriad of factors that do not relate to government action. For example, in a sleepy little town with a sleepy little town economy BMW decides to build a manufacturing plant. Prior to BMW moving into the town, you could buy lunch at the diner for $1.75 and get the tires rotated and balanced on your car for $15.00. Exactly 1 year after the plant opens and most of the population has jobs that are paying between $12.50 and $20.00, lunch in the diner is $5.25 and it costs $45.00 to get your tires rotated and balanced.

This is not a fictitious little town. My daugher and son in law live there. The inflation was a result of the population earning more than they did prior to the new business in town and not due to government actions.

In the area where I live, we are influenced by the biotechnology and medical industries centered in the Raliegh, Durham, Chapel Hill area of NC. As a result, we have the highest number of people with post graduate diplomas per capita in the entire country. Real estate has gone through the roof. Not because government has done anything but because there are a large number of high earners in the area and the amount of money they are willing to spend on a home, or property on which to build a home.

The fed can cause inflation, but then so could a central bank that was using gold as the backing for its currency, but to suggest that nothing can cause inflation but government action is simply not true. Were this the case, real estate values, for example, would be more or less the same across the nation because dirt is dirt.

 

[palerider]

Produce and present evidence of your claim. In many cases perceived fluctuations were due to government intervention. For example, when monetary problems hit Rome because taxes could go no higher without revolution, the government began clipping or shaving the edges off the Denarius when they came into the treasury, and then minted new coins from those clippings. Of course, people caught on to the counterfeiting deception rather quickly, and inflation was the result. People wanted more of the clipped coins for the same products/services.

Gold varies in price depending on the currency it is being bought with, but as this graph clearly shows, it's value isn't consistent enough to consider using it as the basis for a currency in the global economy we live in today. This chart, and the ones to follow are very long term in nature (30 years), and have the appearance of relative stability but short term charts would show wild fluctuations from day to day and week to week.

This is where reeding coins came from - cutting notches into the edges of coins. This allowed anyone to see if the coin had been clipped or not. Of course, the government was only pretending to be honest and they came up with a new deception to bypass this - debasing the currency. In 54 A.D. a Denarious was 94% silver, by 218 A.D. it was only 43% silver and 50 years later it was less than 1%. Look at the U.S. half dollar in comparison. In 1964 it was 90% silver. Five years later it was down to 40%. Today it contains no silver.

And this is related to the fed how? The fed wasn't around in 54CE and to the best of my knowledge, the denarius is not legal tender here. And once again, what a coin is made of is irrelavent. It matters not a whit whether it is made of gold or tin, it is worth what someone says it is worth and if everyone agrees, commerse goes on. The vending machine that gives me a drink doesn't care whether the quarters I put in it are solid silver or are a sandwich, the machine accepts the concept of a coin of this size being worth this much.

These policies do not foster public confidence - either in the currency or the integrity of the politicians. More reasons why can be found at:

I have confidence in the currency. Everyone I know has confidence in the currency and so far, I have not run into a single business in all of my years that lacked confidence in the currency to the point that they refused to accept it as tender.

Dealing with numismatic coins in the present system is a little different than just the base metals. Regardless, gold has been steady throughout history. And as the following chart shows, it has retained its value IN RELATION TO ALL THE OTHER MAJOR CURRENCIES, and that's the only standard we're discussing here:

Think so do you? Here is gold's value based on other currencies over the past 30 years.

Again, you are ignoring my argument that there is a difference between a VOLUNTARY assignment of value and a FORCEFUL assignment of value. You don't have to accept a value someone tries to persuade you to accept, but if your life, freedom, safety, etc. is on the line, the value is not voluntary.

I have not ignored the argument. That argument has been defeated. If we went to the gold standard tomorrow, laws would be passed instituting it, monetary changes would be made, and we would be FORCED to do business under the new economic system. To participate in any given economy, you are in essence FORCED to abide by its rules whether the value of the currency is based on puka shells, gold, diamonds or moon rocks.

Would it be moral and ethical in your opinion for someone with a gun to threaten you will jail time if you refused to pay $100 for a piece of chewing gum just because they had the legal authority to arbitrarily change the value of chewing gum?

Right now, any business has the authority to charge $100 for a piece of gum. They do not have the right to make me buy it. And it doesn't matter a whit whether the money they expect me to pay with is based on gold, or beach sand. Are you suggesting that business have the right to force you to buy goods that you don't want to buy because you feel that they are not worth the asking price?

Here you finally have a point, but you're still not entirely correct. I like the gold standard obviously, but I would advocate a Constitutional amendment that allows people to use other currencies if they so desire. That is compatible with Natural Law. The only Constitutional Amendments that should be allowed are those that expand freedom and inalienable rights. So, while the Constitution is clear on the matter, I would push for an amendment to allow people the right to choose other currencies. In a strictly Constitutional view, we couldn't even expand to platinum and palladium, which is contradictory since both those metals would also have instrinsic value and all the other monetary properties found in gold and silver.

Do you have any idea what sort of confusion would issue if people were allowed to decide what currency they wanted to use, or be paid in? Once again, you are advocating chaos.

Number one, gold and silver have intrinsic value - they have value OTHER THAN BEING JUST CURRENCY - which federal reserve notes DO NOT HAVE. Gold and silver will be desired without legal tender laws - paper/fabric currency would not be desired.

Nothing has intrinsic value. Intrinsic value means that a thing has value by virtue of being itself. Gold and silver only have value because people agree that they have value. But then people agree that our dollars based on the current economic system have value as well.

As to what is desirable, most people would rather carry paper money than a bag of gold.

Every individual should be free to choose, yes, but they would quickly move to a common standard once they found something that was STABLE AND COULDN'T BE MANIPULATED BY THE GOVERMENT.

There is no currency that can not be manipulated by the government.

LOL. Oh, you've been pwned numerous times. The next time someone asks you if you own yourself, tell them "No, Truth-Bringer pwns me."

I am sure that you believe you are quite cute. The fact is, however that you have lost this discussion and every point in it. You brought information here that was over your head and were not prepared to discuss it, and when I finally did get you to speak in your own words, the intellectual level of the conversation fell by an order of magnitude and you begain to argue trivialities. I invite you to bring the admin or a panel of board members in to judge the results of this debate, if debate is what you want to call it.

 

[Truth-Bringer]

So if the stock market drop has nothing to do with the federal reserve, why did you inject the chinese and the stock market drop into the discussion?

To show that an additional financial matter - WHICH IS NOT THE MAIN DANGER - can still have an immediate and negative impact on our own economy. Therefore, how much more so the real economic danger of the debt and currency China is holding... Maybe if you'd get your head out of your ass and stop looking for Straw Men to argue against 24/7, you could see the plain and simple truth. And your original reply was a Straw Man...

These quotes that you keep bringing here don't represent anything more than someone's opinion. They are not proof of your postion.

What they represent is a factual assessment of the situation. If you claim is that China could immediately sell all U.S. debt, bonds and/or currency and this would not hurt the U.S. economy at all, then produce and present evidence to support this claim.

Here is another source from the conservative voice website. You claim to be a conservative, here is the assessment of another conservative:

"China's central bank sits on a hoard of $1.07 trillion in foreign currencies and securities, making it one of the biggest investors in the world. Now, officials have agreed that the traditional approach to managing this massive rainy-day fund -- keeping it safely invested in bonds issued by U.S. and European governments -- is out of date.

Following the lead of countries like Singapore, South Korea and Norway, China is starting to look at new ways of managing its investments.

Together, these moves by central banks have ramifications for financial markets world-wide. The likely result: fewer steady purchases of investments like U.S. Treasury bonds .....

Even a slight shift of this type could have a significant impact in U.S. markets. China has long been one of the biggest buyers of Treasury notes, making it in effect a major lender to the U.S. government. China's buying has helped keep interest rates low in the U.S.: The greater the demand for a country's bonds, the lower the interest rates the country needs to offer.

Among other things, those huge dollar exchange holdings by China and Russia (the number three holder of exchange reserves) put foreign policy clubs into the hands of nations that do not want to see the United States remain the dominant world power."

From: http://www.theconservativevoice.com/article/22979.html

Now if you claim he's wrong, produce and present evidence proving it.

I have asked you to describe a currency that would not be a fiat currency.

Well I believe I have done so...not that you'll accept the explanation of course...

 

[Truth-Bringer]

I answered that one.

No, you didn't. That is not a direct answer to my question. ROTFL. I've just never seen anyone as delusional as you. My guess is you have some type of mental problem. Seriously, are you autistic or do you have asperger's syndrome?

Is your argument that we couldn't also be "leveraged to the hilt" if our currency was backed by gold?

No, not necessarily. My argument is that a foreign government couldn't cause a crisis that would be hyperinflationary to our currency if it was backed by precious metals. That's the real danger.

But it would be harder for government to deficit spend without fiat currency:

http://www.safehaven.com/article-2151.htm

Inflation can be caused by a myriad of factors that do not relate to government action.

The fed can cause inflation, but then so could a central bank that was using gold as the backing for its currency, but to suggest that nothing can cause inflation but government action is simply not true.

Wrong. It is accepted as fact by the current Fed Chairman. That's conclusive:

"... a world monetary system has emerged that has no historical precedent: a system in which every major currency in the world is, directly or indirectly, on an irredeemable paper money standard . . . It is worth stressing how little precedent there is for the present situation. Throughout recorded history . . . commodity money has been the rule. So long as money was predominantly coin or bullion, very rapid inflation was not physically feasible . . . The existence of a commodity standard widely supported by the public served as a check on inflation .. . The key challenge that now faces us in reforming our monetary and fiscal institutions is to find a substitute for convertibility into specie that will serve the same function: maintaining pressure on the government to refrain from its resort to inflation as a source of revenue. To put it another way, we must find a nominal anchor for the price level to replace the physical limit on a monetary commodity." - Milton Friedman, "Monetary Policy in a Fiat World"

The reason we've been able to avoid hyperinflation so far is because the income tax is used as a buffer against the fiat currency. If you repealed the income tax tomorrow and allowed the government to print money at the same leves they do today, you would see runaway hyperinflation similar to what happened in Germany in the 1920's.

The Federal Reserve even admits Friedman's conclusions are correct:

"The "Great Inflation" of the 1970's challenged and permanently altered economic theory. It vindicated the once-controversial analysis of Milton Friedman, then at the University of Chicago.

"Friedman's monetary framework has been so influential that in its broad outlines at least, it has nearly become identical with modern monetary theory," said the Federal Reserve governor Ben S. Bernanke, at a recent conference at the Federal Reserve Bank of Dallas. (The full text of his speech is available at
http://www.dallasfed.org/news/research/2003/03ftc_bernanke.pdf )

Mr. Bernanke is not a former Friedman student. He did his graduate work at M.I.T. Someone reading Milton Friedman's monetary economics today is likely to miss its significance, Mr. Bernanke noted, much as an apocryphal student called Shakespeare's plays "just a string of quotations."

"His thinking has so permeated modern macroeconomics that the worst pitfall in reading him today is to fail to appreciate the originality and even revolutionary character of his ideas, in relation to the dominant views at the time that he formulated them," he said.

Against the conventional wisdom, Mr. Friedman argued that "inflation is always and everywhere a monetary phenomenon." Inflation had nothing to do with aggressive unions, greedy businesses or even oil cartels -- the bad guys who took the blame in the confusing 1970's. Prices shot up everywhere because the federal government made the supply of money grow faster than the real economy created value. Based on the historical record, he argued, the effects of monetary policy were fairly predictable.

In a 1970 lecture, "The Counterrevolution in Monetary Theory," Mr. Friedman outlined 11 propositions about how monetary policy affects the economy. All were wildly controversial, almost disreputable, at the time. Most are accepted today."

 

[Truth-Bringer]

Gold varies in price depending on the currency it is being bought with, but as this graph clearly shows, it's value isn't consistent enough to consider using it as the basis for a currency in the global economy we live in today. This chart, and the ones to follow are very long term in nature (30 years), and have the appearance of relative stability but short term charts would show wild fluctuations from day to day and week to week.

And what you're failing to see is that the fluctuations would occur in relation to our currency, if it was gold backed. We wouldn't feel the fluctuations. We would only benefit from them, since we would have the strongest, most desired currency in the world.

And this is related to the fed how? The fed wasn't around in 54CE and to the best of my knowledge, the denarius is not legal tender here. And once again, what a coin is made of is irrelavent. It matters not a whit whether it is made of gold or tin, it is worth what someone says it is worth and if everyone agrees, commerse goes on.

It's related as a side comment because the Fed is the principle engine of inflation. What money is made of is not irrelevant. Paper money is subject to hyperinflation. Show me a case of hyperinflation with gold-backed currency...it NEVER happened. Meanwhile, there are many historical examples of millions of people who had their lives wrecked by paper currency.

The vending machine that gives me a drink doesn't care whether the quarters I put in it are solid silver or are a sandwich, the machine accepts the concept of a coin of this size being worth this much.

Fallacious argument. Like saying you could pay your income tax with photocopied dollars. When will you stop with the nonsense?

I have confidence in the currency. Everyone I know has confidence in the currency and so far,

So if you had confidence in slavery, and everyone else you knew had confidence in slavery, slavery would be ok because of all of your confidence?

LOL. How many fallacious arguments can you employ, Shetland pony rider?

I have not run into a single business in all of my years that lacked confidence in the currency to the point that they refused to accept it as tender.

They have little choice, since the legal tender laws serve to pretty much eliminate all competition, and of course since they would be threatened with arrest otherwise:

'Liberty Dollars' Can Buy Users A Prison Term, U.S. Mint Warns

"So says the U.S. Mint, which would like to remind Liberty Dollar users that since the United States already has its own currency, the only thing Liberty Dollars buy in these parts is a jail term."

http://www.washingtonpost.com/wp-dyn...100900993.html

Think so do you? Here is gold's value based on other currencies over the past 30 years.

Once again, you haven't proven anything.

I have not ignored the argument. That argument has been defeated. If we went to the gold standard tomorrow, laws would be passed instituting it, monetary changes would be made, and we would be FORCED to do business under the new economic system. To participate in any given economy, you are in essence FORCED to abide by its rules whether the value of the currency is based on puka shells, gold, diamonds or moon rocks.

As I said though, I don't ultimately advocate a system based on force - I realize you want to argue against Straw Men though and claim you've "defeated" those Straw Men, since it's all you have...

Right now, any business has the authority to charge $100 for a piece of gum. They do not have the right to make me buy it. And it doesn't matter a whit whether the money they expect me to pay with is based on gold, or beach sand. Are you suggesting that business have the right to force you to buy goods that you don't want to buy because you feel that they are not worth the asking price?

NO, YOU MORON. I'm stating that in relation to GOVERNMENT - it is forcing the Fed and fiat currency on everyone. You did not answer my question, so let me rephrase it so your twisted little mind doesn't get confused:

Would it be moral and ethical in your opinion for someone with a gun to threaten you will jail time if you refused to pay a debt of $1,000 with their paper currency instead of a currency of your choosing, just because they had the legal authority to make you do this?

Do you have any idea what sort of confusion would issue if people were allowed to decide what currency they wanted to use, or be paid in? Once again, you are advocating chaos.

I am advocating that people will decide of their own free will in the market what to use as money. They will gravitate to currencies they deem to be stable and secure, and those currencies would become the standard. Your claim of "chaos" is just fearmongering plain and simple.

Nothing has intrinsic value. Intrinsic value means that a thing has value by virtue of being itself. Gold and silver only have value because people agree that they have value.

By intrinsic I mean they have they uses other than as money, which I've already stated.

But then people agree that our dollars based on the current economic system have value as well.

As long as the legal tender laws are in place, Federal Reserve Notes can be used for money--even though they have no intrinsic value and would immediately be worthless if the legal tender laws were repealed. So I can exchange them for value, but that value is constantly, almost unnoticeably, shrinking. Their value isn't stationary. Whenever the government prints excess currency, the value of money currently in circulation slightly declines via inflation:

http://www.financialsense.com/editorials/hodges/2006/0106.html

So, the issue is not what their inherent value is, it's "can they be legally used as money?" Since they can, I'm certainly not going to give any away.

As to what is desirable, most people would rather carry paper money than a bag of gold.

Who said anything about gold and silver coins? This is the internet age. Try digital currency, Rain Man: http://www.e-gold.com

Last I heard, E-gold is doing over a billion dollars a year in business now

There is no currency that can not be manipulated by the government.

Well anything could be potentially manipulated by anyone. That's not the point. As usual, you can't grasp simple points. The issue is, WHAT POSES THE LEAST RISK OF BEING MANIPULATED? Paper money, that you can print at will on a printing press, or something with more scarcity and durability involved? The answer is simple. (Which is probably why you won't get it right...)

I am sure that you believe you are quite cute.

Actually, a lot of people have told me I'm sexy as hell.

The fact is, however that you have lost this discussion and every point in it. You brought information here that was over your head and were not prepared to discuss it, and when I finally did get you to speak in your own words, the intellectual level of the conversation fell by an order of magnitude and you begain to argue trivialities.

You just described your own position perfectly. You finally got something right! Hooray!!!

I invite you to bring the admin or a panel of board members in to judge the results of this debate

I'm all for it, delusional one, since you've already lost.

 

[palerider]

OK. First off, who is china going to sell them to. Secondly, how does the transfer of their ownership represent anything more than a transfer of ownership. The securities are what they are regardless of who owns them. Thirdly, how would being on the gold standard prevent the very same sort of thing from happening?