Huh? It is just that if we don't follow it then there is no rule of law. Noone ever claimed its perfect. You're strange, you think people are alot dumber than they are for some reason.
Yes, this is the main point. The argument will be that it is inconvenient for some people to have to change states. The counter argument is "that's better than having to change countries".
This all sounds like a waste of everyone's time and effort. Probably not worth it in the long run. Instead of devoting their time to circumvent nature's obstacles to a productive, fulfilling life for everyone, people need to devote it to finding ways around man made regulations. And I don't mean that in a utopian way at all.
You would do it anyway because you enjoy it. If not you, someone like you but retired could probably figure out the same thing. To me, at least, the correct argument is that copycats profiting off your work that you shared freely is bs.
If you wouldn't do it out of enjoyment, it probably sucks compared to what the guy who did it for himself would do. You should want people to copy your art, if not you are doing it wrong.
As far as the competition in issuing money, I sort of see the point. The trouble is, the massive abuse of workers by companies paying in their own scrip back in the 19th and 20th centuries, and the continued practices of abuse of users of gift cards and all kinds of "point" systems right up to the current day leaves me a bit shy on the idea.
I don't really see a difference between scrip and "debt bondage" or whatever you want to call it. Today, people think they "own" a house because they agree to paying a bank for 30 years to have the right to it. The use of credit cards is rampant, it is an extra tax on every purchase you make, no matter where. The whole scheme has just added in one more layer of complexity. In fact I think the new thing is going to be to phase out cash, and only allow use of credit and debit in the name of preventing money laundering and tax evasion.
Bitcoin tries to use fundamental laws of math (unproven ones, of course, and many of us are actually hoping that they're not fundamental laws) as the central authority, but I don't quite think that system is going to make it in the long run.
What do you mean here? You could be referring to many things and I am not an expert. Do these rules of math you refer to also apply to our current system (e.g. password encryption)?
As for full reserve banks, those exist now as part of some bank branches in the form of safety deposit boxes. If the banks can't loan out your savings, however, the only way they can stay in business is to charge you fees for holding your stuff for you (of course, banks currently can loan out more money than they have deposited with which is a bit disturbing).
I would add escrow fees and probably "processing fees" for exchanging bank notes to whatever is backing it. Also I saw an article awhile back that banks did start charging large depositors to store dollars due to high insurance costs. I couldn't find it with a quick google, so I don't have the details.
The US does spend a lot on guarding its assets, but I don't think they'd spend less on guarding the rest of it if they also had to guard huge piles of gold, they would just spend extra on guarding the gold. Of course, since the US doesn't have all the money they're spending on the military at the moment, they're actually putting everything at risk. The lesson the US apparently didn't learn from the economic meltdown of the USSR is that the same think could happen to the US as well.
Any more than is spent on Area 51? For all we know places like that are where the secret stash of gold is already held. That is getting "speculative", but I imagine if we totaled the amount spent on black projects it would set an upper bound on what it would cost to defend a huge gold stash. It may be a drop in the bucket.
If the US decided to go back on the gold standard right now, it would have to either buy up a lot of gold, which would drive up the price even more, so it would be much better for the us to wait until it drops back down again if it were to do so (which it just isn't ever going to do unless some really fringe politicians manage to take over Congress), or it could start a massive gold mining program which would drive the price of gold way down.
Haha, yea only the insiders would know beforehand.... more conspiracy theory leading to your second possibility, etc.
Anyway, a system backed with a fractional reserve of gold wouldn't be truly gold backed (the realities of which are why the US went off the gold standard in the first place). For bank fractional reserves (which are ridiculously low even if the federal reserve didn't itself only use a fractional reserve), the rest of the deposits are backed by debt to the bank and most of those debts are backed by collateral in the form of real assets like vehicles, land, etc. So a fractional reser
I don't think that would be totally rational. That supply (I know it is just an arbitrary example) would last about 3 months for each mouth to feed, and really $500 isn't that much, it would be easy to do both for the type of person who has money to invest in gold. If you think the chaos is going to last longer than 3 months I think it would be time to diversify into guns/ammo, medical supplies, etc.
I currently think it will turn out to be a bubble as well. This is not a sure thing though. If things come to a head hyperinflation of the dollar will be the last resort. What will people turn to? Gold may be chosen for almost superstitious reasons, but we shouldn't ignore that public perception will play a role what happens.
Note that there's only one period in the whole thing. That's just the way lawyers roll. Anyway, you'll not that, in context, it doesn't define what constitutes "lawful money" for the purposes of individual citizens redeeming their notes. Actually, it just seems to confuse the whole matter. Also, it doesn't define what it means by coin. "gold and silver coin of the United States" has no need to actually mean physical coins of gold or silver, it can be anything the US coins as gold and silver "coin", which can include things like treasury bonds and, in fact, dollar bills.
After reading that, I agree with you on the weasel wording of the coin thing. It still says on the bill you could go to the treasury to redeem it for gold though. I don't really have any idea how common it was for a normal person to do that in practice, probably not very. On the other hand, governments could and would decide to change the weight of gold the currency was defined as, as you say.
Anyway, with the reserve set at 25% (and that not necessarily in physical gold and silver) only a small percentage of people would actually be able to go the the bank and get gold. They certainly couldn't go to Fort Knox to do it. You should also note that the 5 dollar bill says "gold or lawful money", not "gold or silver", which would be shorter. In this day and age, anyone who has managed to avoid sending their life savings to a Nigerian prince should recognize that as weaselspeak for: "gold or whatever we deem to be lawful money, at our option".
The more I think about it the root problem seems to be a lack of competition in issuing money. There must be a market for paranoid people who want to keep their money in a full-reserve bank, backed by whatever, just look at everyone buying gold certificates. It would be basically the same thing.
Just face it, the gold standard wasn't some paradise. It never really worked very well. There just wasn't enough gold, for one thing. And if you had piles of the stuff backing the paper currency, you had to spend money like crazy on security to protect it. Now, it's true that people whose savings were in gold in nations that have economically collapsed have managed to make out better than their fellow countrymen. But the same would be true if their money were in foreign investments, or other precious metals, sometimes in land (other times, the land may be seized by the government or by mob rule, but then again, they can do the same thing to the gold), or in valuable art, etc.
The US currently spend about 1/3rd of it's budget protecting its people, land, and other investments. I would say this is pretty much equivalent to protecting the value of the dollar.
The point is, there's nothing special about gold. The gold standard has been de facto defunct in the US for about a century since shortly after it went back on it. There's nothing magical or special about gold that makes it the king of metals, or the only proper basis for currency. It's just a shiny, relatively rare, heavy metal that some people fetishize unduly.
I think he reasons for that are political more than a failure of gold to store wealth. And, as described by you above, the gold standard wasn't really "pure" anyway, so it may not be the best example. I think decentralized cryptocurrencies are a great idea by the way. Widespread adoption of those would get rid of the expensive storage and fractional banking issues altogether, but we will see what happens with the bitcoin project.
I would like a giant pile of gold coins to swim around in like Scrooge McDuck as much as the next guy, but I think it's silly to base a system of economics on it. When you consider that a high estimate of all the gold the human race has ever produced (and most of which has probably been lost by now) doesn't even equal a quarter of the world GDP even at the current hyperinflated g
I don't think it does has a special magic value. I think it is relatively divisible, rare, easy to transfer, store, and very durable, etc. Making it a good currency, but not as good as paper (due to storage, etc). So it is logical to use something like gold as a store of value, and use paper notes that someone you trust promises to take in exchange for gold to transfer value around. It's not magic, it is just convenient. Also, I agree that the term intrinsic value is BS.
"The terms 'lawful money' or 'lawful money of the United States' shall be construed to mean gold and silver coin of the United States.
- Title 12, U.S. Code, Section 152 [12 USC 152]
The value of the dollar was set equal to a certain weight of gold. The value of the gold was determined by the market (how much you could sell it for).
I think this quote from the gold wikipedia page illustrates the point I was making:
The Mali Empire in Africa was famed throughout the old world for its large amounts of gold. Mansa Musa, ruler of the empire (1312â"1337) became famous throughout the old world for his great hajj to Mecca in 1324. When he passed through Cairo in July 1324, he was reportedly accompanied by a camel train that included thousands of people and nearly a hundred camels. He gave away so much gold that it depressed the price in Egypt for over a decade.[36] A contemporary Arab historian remarked:
Gold was at a high price in Egypt until they came in that year. The mithqal did not go below 25 dirhams and was generally above, but from that time its value fell and it cheapened in price and has remained cheap till now. The mithqal does not exceed 22 dirhams or less. This has been the state of affairs for about twelve years until this day by reason of the large amount of gold which they brought into Egypt and spent there [...]
â"Chihab Al-Umari[37]
Yes, arbitrage would occur, but as the volume of trade increased between multiple cultures, the value would become equal. This is true for any easily trade-able commodity. It is not an issue in terms of trade. Once governments began minting coins and setting the exchange rate, it became a problem due to loss of gold or silver or whatever was undervalued. At least that's my understanding.
If the USD was backed by land, and the government needed to pay back a loan, would the creditor be able to claim land rather than the currency? Who would be responsible for appraising the total value of the land?
I don't really get it, can you explain further or link me? People would hold direct elections to determine who own everything? Seems like there wouldn't be time to be informed on all issues (even less than now).
Haven't you ever done something slightly different than other people, and found it worked better than the way most people were doing? You just innovated.
Yep, this idea that noone will invent something, improve upon an idea, or share unless they get paid forever is obviously flawed. It is one of those arguments that is so academic it ignores reality.
Now, does copyright encourage innovation by discouraging trade secrets? That is more a matter of debate. I would say any reasonable copyright will be too complex to function properly. But that may be worth looking at historically. This doesn't necessarily have to be government-issued copyright, but could just be due to contract between different companies.
I think the situation you described almost certainly existed to some extent, mostly during transitional periods. Do you have any sources for how much the value of gold has varied from place to place historically?
Have you actually considered why someone would not want excessive government intervention of business or enforced integration? Lets say its not a politician, but just a normal person.
Slashdot Mirror
Romney seems trustworthy? How so?
Huh? It is just that if we don't follow it then there is no rule of law. Noone ever claimed its perfect. You're strange, you think people are alot dumber than they are for some reason.
Honestly, I'm not sure taxes are even relevant at this point.
Yes, this is the main point. The argument will be that it is inconvenient for some people to have to change states. The counter argument is "that's better than having to change countries".
This all sounds like a waste of everyone's time and effort. Probably not worth it in the long run. Instead of devoting their time to circumvent nature's obstacles to a productive, fulfilling life for everyone, people need to devote it to finding ways around man made regulations. And I don't mean that in a utopian way at all.
You would do it anyway because you enjoy it. If not you, someone like you but retired could probably figure out the same thing. To me, at least, the correct argument is that copycats profiting off your work that you shared freely is bs.
If you wouldn't do it out of enjoyment, it probably sucks compared to what the guy who did it for himself would do. You should want people to copy your art, if not you are doing it wrong.
I don't really see a difference between scrip and "debt bondage" or whatever you want to call it. Today, people think they "own" a house because they agree to paying a bank for 30 years to have the right to it. The use of credit cards is rampant, it is an extra tax on every purchase you make, no matter where. The whole scheme has just added in one more layer of complexity. In fact I think the new thing is going to be to phase out cash, and only allow use of credit and debit in the name of preventing money laundering and tax evasion.
What do you mean here? You could be referring to many things and I am not an expert. Do these rules of math you refer to also apply to our current system (e.g. password encryption)?
I would add escrow fees and probably "processing fees" for exchanging bank notes to whatever is backing it. Also I saw an article awhile back that banks did start charging large depositors to store dollars due to high insurance costs. I couldn't find it with a quick google, so I don't have the details.
Any more than is spent on Area 51? For all we know places like that are where the secret stash of gold is already held. That is getting "speculative", but I imagine if we totaled the amount spent on black projects it would set an upper bound on what it would cost to defend a huge gold stash. It may be a drop in the bucket.
Haha, yea only the insiders would know beforehand.... more conspiracy theory leading to your second possibility, etc.
Sorry, 50 bucks.
I don't think that would be totally rational. That supply (I know it is just an arbitrary example) would last about 3 months for each mouth to feed, and really $500 isn't that much, it would be easy to do both for the type of person who has money to invest in gold. If you think the chaos is going to last longer than 3 months I think it would be time to diversify into guns/ammo, medical supplies, etc.
I currently think it will turn out to be a bubble as well. This is not a sure thing though. If things come to a head hyperinflation of the dollar will be the last resort. What will people turn to? Gold may be chosen for almost superstitious reasons, but we shouldn't ignore that public perception will play a role what happens.
After reading that, I agree with you on the weasel wording of the coin thing. It still says on the bill you could go to the treasury to redeem it for gold though. I don't really have any idea how common it was for a normal person to do that in practice, probably not very. On the other hand, governments could and would decide to change the weight of gold the currency was defined as, as you say.
The more I think about it the root problem seems to be a lack of competition in issuing money. There must be a market for paranoid people who want to keep their money in a full-reserve bank, backed by whatever, just look at everyone buying gold certificates. It would be basically the same thing.
The US currently spend about 1/3rd of it's budget protecting its people, land, and other investments. I would say this is pretty much equivalent to protecting the value of the dollar.
I think he reasons for that are political more than a failure of gold to store wealth. And, as described by you above, the gold standard wasn't really "pure" anyway, so it may not be the best example. I think decentralized cryptocurrencies are a great idea by the way. Widespread adoption of those would get rid of the expensive storage and fractional banking issues altogether, but we will see what happens with the bitcoin project.
I don't think it does has a special magic value. I think it is relatively divisible, rare, easy to transfer, store, and very durable, etc. Making it a good currency, but not as good as paper (due to storage, etc). So it is logical to use something like gold as a store of value, and use paper notes that someone you trust promises to take in exchange for gold to transfer value around. It's not magic, it is just convenient. Also, I agree that the term intrinsic value is BS.
I wasn't alive at the time, but here is a picture of a 5 dollar note from 1928:
It reads: "Redeemable in gold on demand at the United States Treasury or in gold or lawful money at any Federal Reserve Bank"
http://www.deerrunmercantile.com/friedberg1952-cfivedollarfederalreservenotepmg66gem.aspx
"The terms 'lawful money' or 'lawful money of the United States' shall be construed to mean gold and silver coin of the United States.
- Title 12, U.S. Code, Section 152 [12 USC 152]
The value of the dollar was set equal to a certain weight of gold. The value of the gold was determined by the market (how much you could sell it for).
I think the purpose is collecting data on who cares about what, where to allow for targeting marketing.
I think this quote from the gold wikipedia page illustrates the point I was making:
The Mali Empire in Africa was famed throughout the old world for its large amounts of gold. Mansa Musa, ruler of the empire (1312â"1337) became famous throughout the old world for his great hajj to Mecca in 1324. When he passed through Cairo in July 1324, he was reportedly accompanied by a camel train that included thousands of people and nearly a hundred camels. He gave away so much gold that it depressed the price in Egypt for over a decade.[36] A contemporary Arab historian remarked:
Gold was at a high price in Egypt until they came in that year. The mithqal did not go below 25 dirhams and was generally above, but from that time its value fell and it cheapened in price and has remained cheap till now. The mithqal does not exceed 22 dirhams or less. This has been the state of affairs for about twelve years until this day by reason of the large amount of gold which they brought into Egypt and spent there [...]
â"Chihab Al-Umari[37]
Yes, arbitrage would occur, but as the volume of trade increased between multiple cultures, the value would become equal. This is true for any easily trade-able commodity. It is not an issue in terms of trade. Once governments began minting coins and setting the exchange rate, it became a problem due to loss of gold or silver or whatever was undervalued. At least that's my understanding.
So to flesh out this concept:
If the USD was backed by land, and the government needed to pay back a loan, would the creditor be able to claim land rather than the currency? Who would be responsible for appraising the total value of the land?
I don't really get it, can you explain further or link me? People would hold direct elections to determine who own everything? Seems like there wouldn't be time to be informed on all issues (even less than now).
Haven't you ever done something slightly different than other people, and found it worked better than the way most people were doing? You just innovated.
What is ownership if not control? How will you enforce the "ownership" of some property if the "owner" cannot control it.
Yep, this idea that noone will invent something, improve upon an idea, or share unless they get paid forever is obviously flawed. It is one of those arguments that is so academic it ignores reality.
Now, does copyright encourage innovation by discouraging trade secrets? That is more a matter of debate. I would say any reasonable copyright will be too complex to function properly. But that may be worth looking at historically. This doesn't necessarily have to be government-issued copyright, but could just be due to contract between different companies.
Ok... now consider land and productive output then compare the results with gold. I think gold comes out superior.
I think the situation you described almost certainly existed to some extent, mostly during transitional periods. Do you have any sources for how much the value of gold has varied from place to place historically?
So, do we agree there is not really a such thing as intrinsic value?
http://www.reuters.com/article/2011/12/04/italy-idUSL5E7N40CB20111204
Scary stuff going on in europe.
Have you actually considered why someone would not want excessive government intervention of business or enforced integration? Lets say its not a politician, but just a normal person.