Someone needs to read Rothbard.

My world runs on a porn based economy. It always has value.

Devaluation is most likely going to happen anyway, even at a global level. How it happens may be the more important question. The gold standard may be implausible, however I don't think the words "pretty darn stupid" really works in this case.

EvilEgg: EnviroDude: If you were to apply the gold standard to the price of goods:

in 10/79 the price of gold = $400/ounce

The price of a new 1979 Chevy Impala(the car I drove) = $3200 or 8 ounces of gold

The price of a 2011 chevy Impala = $ 25645

Based on gold (1 ounce = $1666), the price of the car would be 14.7 ounces.


Looks like a pretty good argument for the gold standard. If you were to apply this to the price of a home, a good Brooks Brothers Suit, and other items, you see how fiat currency is eating away your worth.

Only have $1Million in your 401K? Hope you like beenie weenies for your retirement.

But it is also eating away at my debt, so my mortgage gets cheaper every day.

A 2011 impala is a far, far superior product to the 1979 impala, personal design preferences disregarded.

why does gold have value?

dumbobruni: why does gold have value?

Because it doesn't grow on trees?

dumbobruni: why does gold have value?

Its rare, its durable, and its near impossible to counterfeit.

Lost Thought 00: dumbobruni: why does gold have value?

its near impossible to counterfeit.



Not for long, Hawk-head!
/Bunny! Ball-ball!

RON PAUL's claim that gold prices can't be easily manipulated is just bizarre. Of course they can. What does he think has been happening to gold prices in the last five years?

I'm holding silver and copper, so I'll be the only guy that can make change.

EnviroDude: If you were to apply the gold standard to the price of goods:

in 10/79 the price of gold = $400/ounce

The price of a new 1979 Chevy Impala(the car I drove) = $3200 or 8 ounces of gold

The price of a 2011 chevy Impala = $ 25645

Based on gold (1 ounce = $1666), the price of the car would be 14.7 ounces.


Looks like a pretty good argument for the gold standard. If you were to apply this to the price of a home, a good Brooks Brothers Suit, and other items, you see how [I'm cherry-picking (new window)].

FTFY

/not to mention that yours isn't even a legitimate comparison in the first place

It kills me hearing RONPAUL talk about how we got to get rid of the "booms and busts" when going back to a gold standard would greatly magnify those wild economic swings. The reason we went off the gold standard in the first place was to dampen that effect down.

The man isn't dumb but how he could be uaware of this boggles me, I guess he is so blinded by the libertarian ideology that 2+2 starts becoming a head scratcher.

FTFA: "Economic policy makers across the political spectrum have successfully maintained the debt-based monetary system since 1971,"

Yeah. 40 years is enough evidence to overturn thousands of years of empirical evidence.

/and it was NIXON that finally ended the gold standard in the US.
//Why do economic liberals support Nixon?

To put it another way, I do not see treasure hunters risking life and limb to find paper fiat currency from the Weimar Republic (new window)

However, centuries old gold and silver coins from Spain, Rome and others are always worth their weight in, well, gold or silver.

tallguywithglasseson: Wonder if we'll hear from RON PAUL supporters who will tell you RON PAUL doesn't support a return to the gold standard, directly followed by their explanation of why we should return to the gold standard.

I wonder if RON PAUL supporters know he's heavily invested in gold miners and has been for the last 15 years?

tomWright: /and it was NIXON that finally ended the gold standard in the US.
//Why do economic liberals support Nixon?

The guy created the EPA and engaged China as well. Republicans were always criminal, but they weren't always retarded.

Ron Paul is stupid about many many things.

His "we don't need need no social programs" stupidity is typical of the mental defect known as libertarianism.

Barbigazi: tomWright: thousands of years of empirical evidence

Que?

History of money (new window)

Barbigazi: tomWright: To put it another way, I do not see treasure hunters risking life and limb to find paper fiat currency from the Weimar Republic (new window)

However, centuries old gold and silver coins from Spain, Rome and others are always worth their weight in, well, gold or silver.

Ah, the Indiana Jones school of economics. That's not dumb.

The point being that fiat currency can become worthless overnight but commodity currency is always worth something.

That said, gold and silver are not investments that return dividends that ownership of business stocks theoretically can do. They are a way to store value, transport and exchange it. Hard currency backed paper is just a more convenient way to perform those tasks.

Fiat money is the greatest invention for the rich and powerful since the invention of kings.

EnviroDude: Only have $1Million in your 401K?

You actually do not have any cash in your 401K (or at least, very little). You have investments in corporations and bonds that can be converted to cash. If those investments are in something that is truly valuable, your portfolio's value will increase greater than inflation.

Currency is not a store-holder of value. It is a medium of exchange. A depreciating currency strongly encourages investments into things that actually do hold value- real estate, corporations, commodities, etc. All the gold standard does is force the entire population of the country to enter into the commodities market whether they like it or not.

HotWingConspiracy: tomWright: /and it was NIXON that finally ended the gold standard in the US.
//Why do economic liberals support Nixon?

The guy created the EPA and engaged China as well. Republicans were always criminal, but they weren't always retarded.

The idea of the EPA, a police force specializing in the environment, was good.. The implementation has been a bureaucratic disaster, like most things political.

Opening relations with China was brilliantly done, and has likely prevented a lot of war in the past 40 years. If a Democrat had done it, we would have had 40 years of partisan Republican derp, like we have had over Cuba from all sides. It remains to be seen if we keep these peaceful relations with China, or if one of the US political parties decides to use China as the next boogie man to scare the population into compliance with more government encroachment on freedoms.

Barbigazi: tomWright: Barbigazi: tomWright: To put it another way, I do not see treasure hunters risking life and limb to find paper fiat currency from the Weimar Republic (new window)

However, centuries old gold and silver coins from Spain, Rome and others are always worth their weight in, well, gold or silver.

Ah, the Indiana Jones school of economics. That's not dumb.

The point being that fiat currency can become worthless overnight but commodity currency is always worth something.

That said, gold and silver are not investments that return dividends that ownership of business stocks theoretically can do. They are a way to store value, transport and exchange it. Hard currency backed paper is just a more convenient way to perform those tasks.

Fiat money is the greatest invention for the rich and powerful since the invention of kings.

If the country collapses sure, but if the county collapses good luck getting any value out of gold you don't have in your hot little hands. Basing a monetary system on "what if Mad Max" isn't a good plan.

But at least you are left with something, which is more than nothing. Unless you count using your money as kindling, something,

But that is an argument for competition among banks to issue currency, and not let the government have a monopoly. Eliminate the Legal tender laws and let banks offer their own commodity backed money. With regulations to keep things honest. If one bank goes down, only a small percentage is lost. In the current situation, if the Fed goes down, everything is lost.

Hey, I would keep some hemp-script around, maybe even some flax-script.

tomWright: /and it was NIXON that finally ended the gold standard in the US.

That was Bretton Woods, which was a funky arrangement in the first place. The United States hadn't printed gold and silver certificates since the 30s. Indeed it was the slowness in getting away from that that hampered recovery from the great depression. Those countries that abandoned pinning their currency to gold and silver sooner, recovered faster. Those that waited longer, took longer.

tomWright: Eliminate the Legal tender laws and let banks offer their own commodity backed money.

That's been tried in various ways, it doesn't work. Because no one trusts the money.

Oh and as for what happened in Weimar Germany, that was because of the reparations Germany was forced to pay.

Do Mr. Brodsky's math skills extend to printing fiat paper until the cows come home?

No? Nothing? Oh, well.

tomWright: Barbigazi: tomWright: Barbigazi: tomWright: To put it another way, I do not see treasure hunters risking life and limb to find paper fiat currency from the Weimar Republic (new window)

However, centuries old gold and silver coins from Spain, Rome and others are always worth their weight in, well, gold or silver.

Ah, the Indiana Jones school of economics. That's not dumb.

The point being that fiat currency can become worthless overnight but commodity currency is always worth something.

That said, gold and silver are not investments that return dividends that ownership of business stocks theoretically can do. They are a way to store value, transport and exchange it. Hard currency backed paper is just a more convenient way to perform those tasks.

Fiat money is the greatest invention for the rich and powerful since the invention of kings.

If the country collapses sure, but if the county collapses good luck getting any value out of gold you don't have in your hot little hands. Basing a monetary system on "what if Mad Max" isn't a good plan.

But at least you are left with something, which is more than nothing. Unless you count using your money as kindling, something,

But that is an argument for competition among banks to issue currency, and not let the government have a monopoly. Eliminate the Legal tender laws and let banks offer their own commodity backed money. With regulations to keep things honest. If one bank goes down, only a small percentage is lost. In the current situation, if the Fed goes down, everything is lost.

Hey, I would keep some hemp-script around, maybe even some flax-script.

If the fed goes down, the least of your concerns will be currency. It also means that the US military has fallen and you are most likely in the process of being enslaved or executed by and invading power.

It's still better than the value of our money being based on very little..

tomWright: Barbigazi: tomWright: Barbigazi: tomWright: To put it another way, I do not see treasure hunters risking life and limb to find paper fiat currency from the Weimar Republic (new window)

However, centuries old gold and silver coins from Spain, Rome and others are always worth their weight in, well, gold or silver.

Ah, the Indiana Jones school of economics. That's not dumb.

The point being that fiat currency can become worthless overnight but commodity currency is always worth something.

That said, gold and silver are not investments that return dividends that ownership of business stocks theoretically can do. They are a way to store value, transport and exchange it. Hard currency backed paper is just a more convenient way to perform those tasks.

Fiat money is the greatest invention for the rich and powerful since the invention of kings.

If the country collapses sure, but if the county collapses good luck getting any value out of gold you don't have in your hot little hands. Basing a monetary system on "what if Mad Max" isn't a good plan.

But at least you are left with something, which is more than nothing. Unless you count using your money as kindling, something,

But that is an argument for competition among banks to issue currency, and not let the government have a monopoly. Eliminate the Legal tender laws and let banks offer their own commodity backed money. With regulations to keep things honest. If one bank goes down, only a small percentage is lost. In the current situation, if the Fed goes down, everything is lost.

Hey, I would keep some hemp-script around, maybe even some flax-script.

Try eating it. If a mad max scenario were to really happen, you'd be better off hoarding spices. Don't forget that, for centuries, the price of pepper was fixed to the price of gold. Ounce for ounce. You can't grow more gold, but you can grow more pepper to trade or to use yourself.

Don't forget to look poor either. This isn't a book or Hollywood movie. You have something after the collapse, people will take your stuff, and you will eventually lose.

I wonder what the gold bugs think of what the long term effect would be of a gold supply that only grows by .5% a year vs a population that grows ~3 times faster.

inglixthemad: Try eating it. If a mad max scenario were to really happen, you'd be better off hoarding spices. Don't forget that, for centuries, the price of pepper was fixed to the price of gold. Ounce for ounce. You can't grow more gold, but you can grow more pepper to trade or to use yourself.

Don't forget to look poor either. This isn't a book or Hollywood movie. You have something after the collapse, people will take your stuff, and you will eventually lose.

This. If we get to the point where the dollar is worthless, then gold is worthless too. Guns and food will be the most valuable thing.

Somaticasual: It's still better than the value of our money being based on very little..

The value of money is based on what it will purchase. That's true for fiat currency or for commodity currency.

The most retarded thing about goldbugs is that there's already nothing stopping them from buying gold and using it as a medium of exchange. Have no faith in the dollar? Buy gold! The government doesn't care! You can even trade gold shavings or nuggets for goods, today. But then you'll realize how inconvenient it is as a medium of exchange -- you can't exactly buy goods on-line when the gold's sitting in your mom's basement. People figured out how inconvenient it was to haul that shiat around as far back as the Middle Ages. The stuff needs to be measured every time, and gold notes aren't any less susceptible to forgery or inflation than a floating system. That's not the Fed's fault.

Going to the gold standard is the opposite of "small government". As t3knomanser says, it basically forces people into commodities.

Going to the gold standard will destroy the economy. The one upshot for goldbugs, and do think very carefully about the implications here, is that forcing the entire country to switch to a commodity they've been buying up over the last few years will make them all fabulously rich overnight. It would re-write the history books as the greatest transfer of wealth in history.

tomWright: Why do economic liberals support Nixon?

I don't know if you should call us liberal, but not everyone roots for political parties like they're competing sports teams. I hate the bad things Nixon did, and he was an asshole, but I'll be intellectually honest about the good things he did.

t3knomanser: Somaticasual: It's still better than the value of our money being based on very little..

The value of money is based on what it will purchase. That's true for fiat currency or for commodity currency.

Value is subjective, and based on different things to buyer and seller. For one, the buyer prefers the benefit of the good or service over that of their medium of exchange, while the seller prefers the reverse.

As far as the medium of exchange goes, if value is subjective, let's not tie it to a finite resource. I'd love it if the Fed were more open (if it became tradeable on the NYSE, would we all die horribly? Just asking.), but herpaderping about the value of gold is a separate argument entirely.