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Posted: Sat Oct 19, 2013 10:33 am
by claimdude
algale wrote:His gold selling website is prominently linked to on the YouTube page, so that's why I conclude his presentation is really part of a sales pitch and that he's got less than purely educational goals in mind with his presentation. Look up what a Ponzi scheme and pyramid scheme are (two of the terms he used repeatedly in his presentation). The Federal Reserve and fractional banking systems may be confusing and counter-intuitive to the uninitiated, but they don't share the defining characteristics of either a Ponzi scheme or a pyramid scheme. Nor, despite his assertions to the contrary, is the Federal Reserve or fiat money system illegal or unconstitutional. Claiming that they are illegal and unconsitutional ventures into politics and ideology. His use of those perjorative terms is, in my opinion, part of his sales pitch, which is partially dependent on scare tactics.
To answer your question, if I truly thought that gold was intrinsically valuable and that paper money was a hoax about to collapse, I wouldn't recommend he sell me (or anyone else) gold on a commercial basis as the danger is he'd get caught with a major position in worthless paper money when the imminent collapse finally came about. Instead, I'd recommend he sit on his gold while it appreciated in value and only cash out the absolute minimum necessary to pay taxes and purchase necessities while awaiting the zombie apocalypse.
Now I have a question for you. Where do you think gold get its value from and what makes it intrinsically superior to paper money as the basis of a monetary system? Can't eat gold, can't drink it, can't drive your car with it or even burn it to heat your house (at least paper money can be burned and has been burned at times in other countries when their currencies have collapsed!). Once you get away from straight bartering and move to a monetary system, it really doesn't matter what you choose as the basis for your monetary system. Be it gold, silver, seashells, paper or anything else, that monetized thing is only valuable because we collectively agree to pretend as if it is valuable and agree to exchange actual valuable things for whatever thing we have chosen to monetize. That is why some economists say that all money is in reality fiat money. Because even when you can trade in your paper money in for a defined quantity of gold that gold is itself without any intrinsic value unless we agree it has value.
None of this is to say that the present monetary system is perfect or immune from collapse. But potential does not equal probability and in some respects being off the Gold Standard makes it easier to prevent such collapses. Even when we had the Gold Standard, there were booms, busts, depressions, inflation, deflation, currency manipulations, deficit spending and other economic woes.
Nor is holding gold (either in far away vaults or in bullion burried in your own backyard) a panacea. As davebodner points out, people have lost a lot of money in the gold markets.
Gold has intrinsic value due to its durability, appearance and scarcity. Gold has always been valuable (relatively speaking) throughout human history. Gold doesn't get its value from you and I deciding it is worth something but because of the aforementioned and its demand as a store of value. So, if a present day fiat money system collapses gold will still be universally recognized as valuable. The paper stuff with president's faces on them will have zero value. The dollar gets its value from you and I deciding what it is worth to a degree but its value is also derived from the quantity of it in circulation. Too many dollars chasing too few goods makes dollars worth less.
I didn't suggest that gold is a panacea. There are no panaceas. There are good ideas and bad ideas. Our monetary system is a bad idea. Good people of robbed of their purchasing power by politicians and the Fed over time through inflationary monetary policies such as the Fed buying $80+ billion in treasuries every month for the last few year and so on.
If our fiat money was backed by gold citizens have a more direct way of controlling monetary policy and through that public policy by way of masses running to redeem their currency for gold when they lose faith in the government.
During the monetary collapse of Germany following WWI people were collecting their pay every hour and going out to buy goods and services with that worthless cash because inflation was eating away their buying power at an enormous rate. The German government tried to print their way out of a jamb (WWI reparations and such) and it collapsed. At that same time gold and other precious metals were readily accepted in commerce and even preferred over the worthless paper money.
The US is over $16 trillion in debt with no end in sight. If this isn't changed in the near future we will likely go the road of Greece (for a recent example). If the Dollar wasn't the world's reserve currency we would already be in the tank.
Jak
Posted: Sat Oct 19, 2013 10:35 am
by dusty
algale wrote:Don't forget one Shopsmith.
Oh no. It is not available for barter!!
Posted: Sat Oct 19, 2013 10:43 am
by dusty
claimdude wrote:Gold has intrinsic value due to its durability, appearance and scarcity. Gold has always been valuable (relatively speaking) throughout human history. Gold doesn't get its value from you and I deciding it is worth something but because of the aforementioned and its demand as a store of value. So, if a present day fiat money system collapses gold will still be universally recognized as valuable. The paper stuff with president's faces on them will have zero value. The dollar gets its value from you and I deciding what it is worth to a degree but its value is also derived from the quantity of it in circulation. Too many dollars chasing too few goods makes dollars worth less.
I didn't suggest that gold is a panacea. There are no panaceas. There are good ideas and bad ideas. Our monetary system is a bad idea. Good people of robbed of their purchasing power by politicians and the Fed over time through inflationary monetary policies such as the Fed buying $80+ billion in treasuries every month for the last few year and so on.
If our fiat money was backed by gold citizens have a more direct way of controlling monetary policy and through that public policy by way of masses running to redeem their currency for gold when they lose faith in the government.
During the monetary collapse of Germany following WWI people were collecting their pay every hour and going out to buy goods and services with that worthless cash because inflation was eating away their buying power at an enormous rate. The German government tried to print their way out of a jamb (WWI reparations and such) and it collapsed. At that same time gold and other precious metals were readily accepted in commerce and even preferred over the worthless paper money.
The US is over $16 trillion in debt with no end in sight. If this isn't changed in the near future we will likely go the road of Greece (for a recent example). If the Dollar wasn't the world's reserve currency we would already be in the tank.
Jak
So why did the debt ceiling just get raised still again?
I need money to support the rehab that I am doing on the travel trailer. When I approached the "Treasurer" last week for a $3000 increase in the debt ceiling - she ran me off while telling me that the $250 monthly budget line was all that I was going to get. If Obama can do this, why can't I? Especially since I am about $50,000 below my line of credit at the credit union.
Posted: Sat Oct 19, 2013 11:56 am
by davebodner
First, I couldn't possibly write a better explanation than Algale's. Kudos.
Yep, it's possible to debase your currency, like post WWI Germany or several-years-ago Zimbabwe. Fortunately, we aren't doing that, and the proof is in the pudding. Inflation rates remain fairly low, and the Fed has signaled that they'll back off on inflationary policies as needed. Fortunately, we remain fearful of inflation.
Remember, booms and busts occurred in pre-Fed days, too, and with quite a bit more regularity and damage. Remember the Dutch tulips.
Yes, we have our long-term issues. But, we aren't Greece, either. Actually, one of Greece's problems is that they've got a pseudo-gold standard. They have no control over their currency. They're stuck with what the European Central Bank is willing to do, which isn't much. But even without that, we're far from Greece, or Spain for that matter.
Posted: Sat Oct 19, 2013 1:53 pm
by JPG
dusty wrote:Two goats, twelve chickens, one dairy cow, three pigs and a garden full of veggies. Put all of this on three acres of grass land and I'm set so long as I don't get sick.
Do not eat the grass the cow and goat use for pasture! Same fer de piggies.
Heed not, and you may well get sick!:eek:
Posted: Tue Oct 22, 2013 8:00 am
by jere
What gets me is the history of the federal reserve bank, JD Morgan and all the crazy evil tactics they used. Like starting the great depression so the government would have to allow their banking system. I have heard they started American communist groups to make a fake threat and gain influence/control...
That and they still pretty much control the government. They are in all kinds of pockets in Washington, among other things
Posted: Tue Oct 22, 2013 8:34 am
by fredsheldon
Because of Global warming and lack of rains, many lakes and ground water sources are drying up in Texas. I suggest we replace the dollar and gold with water, which will be worth much more than gold when it becomes in short supply. I'm already paying $4.50 for a 12 oz bottle of water at the ball park.
And that 260 gallons of rain water that I have collected in my rain barrels would be worth: 1 gallon = 128 ozs / 12 oz = 10.6 bottles X $ 4.50 = $47.00 X 260 gallons = $12,479.
Posted: Tue Oct 22, 2013 8:43 am
by JPG
fredsheldon wrote:Because of Global warming and lack of rains, many lakes and ground water sources are drying up in Texas. I suggest we replace the dollar and gold with water, which will be worth much more than gold when it becomes in short supply. I'm already paying $4.50 for a 12 oz bottle of water at the ball park.
IIWM the stands would be empty! Gouging at its 'worst'.
Bet they do not 'allow' patrons to bring their own from outside the park.
Subsidiary revenue run amok!
Posted: Sat Oct 26, 2013 1:32 pm
by jake44
No fear of becoming like Greece. Unlike Greece the US is monetarly sovereign in its own currency. Greece uses a foreign currency, the euro. Unlike the US Greece cannot issue its own currency.
http://mythfighter.com/2010/08/13/monetarily-sovereign-the-key-to-understanding-economics/
[url=
http://moslereconomics.com/wp-content/p ... s/7DIF.pdf]
http://moslereconomics.com/wp-content/p ... s/7DIF.pdf[/URL
Jake
Posted: Sat Oct 26, 2013 1:40 pm
by dusty
I am not an expert in this subject at all but maybe (just maybe) issuing our own currency is part of our problem.
When the Treasury prints up a trillion dollars worth of new bills and circulates them, what happens to the debt and deficit? What happens to the value of the dollars that are all ready on the street?