Ron Paul’s Amendment To Audit The Federal Reserve Approved
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In theory, the Fed is an extension of the government, and hence an extension of the people. It's set up as a private institution instead of a direct government agency to stop the government reps from pushing financial agendas for political gain and screwing up the economy. But that's off-topic... Anyway... Gold DOES trickle out of the economy every day. It's a great electrical conductor, among other things. Imagine the amount of gold that's sitting in scrapyards all over the world, still inside discarded electronics. In ancient times, gold basically only had two uses. Currency and opulent luxury goods (Which could be melted down in times of need). Now, gold is an industrial component. Of course, people are continuously mining gold, so it comes back into the economy... Obviously those rates are not going to balance out... If gold WAS currency, mining would increase drastically (Since right now, increases in mining would lower the rarity, and hence the value), and people would likely use alternatives in manufacturing where possible. Hence, the supply would increase. So there WOULD be inflation and deflation, based on the supply versus industrial use. There would still be booms and busts (As we've established). Only three things would change, assuming we could get the entire world to become gold-backed: 1) There would be no way to regulate the market aside from taxes, and no way to prevent the inevitable depressions. 2) Your wallet would be a lot heavier, since all physical currency would have to be metal. 3) Money would retain its value, more or less, so there would be less motivation for individuals to invest their money (Since you don't need to earn interest just to keep up with inflation).
Proud to have finally moved to the A-Ark. Which one are you in? Developer, Author (Guardians of Xen)
Yes... theoretically it's supposed to be an extension of government. But it's so private that we know less about it than all other government arms. OK so now were you trying to refute me on this post? 1) The point of a free market is to not have regulations, except to prevent fraud. That's it. The government is not meant to control prices and interest rates (as the Fed and SEC tries to do). The Fed tries to prevent depressions and inflation... but it is the only source of our current inflation, and nobody can prevent depressions/recessions, nevermind the fact that in my opinion it's the actual source of depressions. 2) I wouldn't complain about your wallet being heavier... I mean come on, wouldn't it be cool to have a bunch of gold in your pocket? Plus, with credit/debit card technology, you don't necessarily need to carry coins around constantly if you don't want. It's just the fact that we don't back the currency, or use gold at all. That, to me, is a problem. 3) Oh no, saving money?! The problem with our society is the fact that we don't save. We're in debt. Almost everyone in America is in debt in one way or another. What's wrong with people saving? If your argument is to not save and invest instead, people should make their own choices as to what to invest in. If they want to just straight up save money, they should do so. If they want to mix (save AND invest), let them do so. It's their money. Investing in a business that they don't know should be up to them; if they feel safer by saving, it's up to them.
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Yes... theoretically it's supposed to be an extension of government. But it's so private that we know less about it than all other government arms. OK so now were you trying to refute me on this post? 1) The point of a free market is to not have regulations, except to prevent fraud. That's it. The government is not meant to control prices and interest rates (as the Fed and SEC tries to do). The Fed tries to prevent depressions and inflation... but it is the only source of our current inflation, and nobody can prevent depressions/recessions, nevermind the fact that in my opinion it's the actual source of depressions. 2) I wouldn't complain about your wallet being heavier... I mean come on, wouldn't it be cool to have a bunch of gold in your pocket? Plus, with credit/debit card technology, you don't necessarily need to carry coins around constantly if you don't want. It's just the fact that we don't back the currency, or use gold at all. That, to me, is a problem. 3) Oh no, saving money?! The problem with our society is the fact that we don't save. We're in debt. Almost everyone in America is in debt in one way or another. What's wrong with people saving? If your argument is to not save and invest instead, people should make their own choices as to what to invest in. If they want to just straight up save money, they should do so. If they want to mix (save AND invest), let them do so. It's their money. Investing in a business that they don't know should be up to them; if they feel safer by saving, it's up to them.
josda1000 wrote:
1)The Fed tries to prevent depressions and inflation... but it is the only source of our current inflation, and nobody can prevent depressions/recessions, nevermind the fact that in my opinion it's the actual source of depressions.
The Fed is NOT the only source of inflation. It only causes inflation/deflation when it performs open market operations, like the stimulus package used to avert the current situation. This isn't a daily thing for them.
josda1000 wrote:
- I wouldn't complain about your wallet being heavier... I mean come on, wouldn't it be cool to have a bunch of gold in your pocket? Plus, with credit/debit card technology, ...
It would basically force people to do things electronically. Not saying this is a bad thing... Just different. I'm guessing there would be some downsides, though, to having the metal itself in the currency, but I'm no expert.
josda1000 wrote:
- Oh no, saving money?! The problem with our society is the fact that we don't save. We're in debt. Almost everyone in America is in debt in one way or another. What's wrong with people saving?
This is a numbers game. Let's say 10% of people decide they'd rather just keep their money safe, whether that's literally in a "safe," under their mattress, or something similar. Remember, savings accounts would no longer be 100% protected, since the FDIC would have to be terminated (The government can only guarantee money on that scale because it can print money). That's 10% less money being invested, so that's going to slow economic growth. Or am I missing something here?
Proud to have finally moved to the A-Ark. Which one are you in? Developer, Author (Guardians of Xen)
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josda1000 wrote:
1)The Fed tries to prevent depressions and inflation... but it is the only source of our current inflation, and nobody can prevent depressions/recessions, nevermind the fact that in my opinion it's the actual source of depressions.
The Fed is NOT the only source of inflation. It only causes inflation/deflation when it performs open market operations, like the stimulus package used to avert the current situation. This isn't a daily thing for them.
josda1000 wrote:
- I wouldn't complain about your wallet being heavier... I mean come on, wouldn't it be cool to have a bunch of gold in your pocket? Plus, with credit/debit card technology, ...
It would basically force people to do things electronically. Not saying this is a bad thing... Just different. I'm guessing there would be some downsides, though, to having the metal itself in the currency, but I'm no expert.
josda1000 wrote:
- Oh no, saving money?! The problem with our society is the fact that we don't save. We're in debt. Almost everyone in America is in debt in one way or another. What's wrong with people saving?
This is a numbers game. Let's say 10% of people decide they'd rather just keep their money safe, whether that's literally in a "safe," under their mattress, or something similar. Remember, savings accounts would no longer be 100% protected, since the FDIC would have to be terminated (The government can only guarantee money on that scale because it can print money). That's 10% less money being invested, so that's going to slow economic growth. Or am I missing something here?
Proud to have finally moved to the A-Ark. Which one are you in? Developer, Author (Guardians of Xen)
- See my qualifier: It is the only source of our CURRENT inflation. There's not a heck of a lot going on except for the Federal Reserve and its operations. The market acts as it always does; it goes up and down on its own, but then the Fed just adds to the problem. The interest rates are currently at all time lows, and they are printing money to bail out the banks. My argument stands. 2) There are always downsides to any kind of system, I just believe that metal backed currency is a better way to go than straight paper. Look at the top of a dollar bill: it says Federal Reserve Note. It's an IOU. A bank note. A loan. Whatever you want to call it, it does not have value. Even if paper were to be worth something, the fact that it's a bank note says that it's replacement for a valued item. I'd say any system would be better than what we have around the globe. 3) Slow economic growth? I can live with that, if it's real growth. Look at wall street. Against gold, the dow is crashing. Against the American dollar, it's growing and coming back to normal. Nominal growth may not be real growth. This is a consumer society, not a production society. Think about it. When we were savers before 1960-1970, we were the richest country in the world. Now look at us... we are still pretty rich, but our growth has stopped, and it's heading down. Quickly. Look at the public debt (better term than federal debt): We're in debt by $12T, roughly. Saving is a much better idea than investing and borrowing, IMHO.
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- See my qualifier: It is the only source of our CURRENT inflation. There's not a heck of a lot going on except for the Federal Reserve and its operations. The market acts as it always does; it goes up and down on its own, but then the Fed just adds to the problem. The interest rates are currently at all time lows, and they are printing money to bail out the banks. My argument stands. 2) There are always downsides to any kind of system, I just believe that metal backed currency is a better way to go than straight paper. Look at the top of a dollar bill: it says Federal Reserve Note. It's an IOU. A bank note. A loan. Whatever you want to call it, it does not have value. Even if paper were to be worth something, the fact that it's a bank note says that it's replacement for a valued item. I'd say any system would be better than what we have around the globe. 3) Slow economic growth? I can live with that, if it's real growth. Look at wall street. Against gold, the dow is crashing. Against the American dollar, it's growing and coming back to normal. Nominal growth may not be real growth. This is a consumer society, not a production society. Think about it. When we were savers before 1960-1970, we were the richest country in the world. Now look at us... we are still pretty rich, but our growth has stopped, and it's heading down. Quickly. Look at the public debt (better term than federal debt): We're in debt by $12T, roughly. Saving is a much better idea than investing and borrowing, IMHO.
josda1000 wrote:
- See my qualifier: It is the only source of our CURRENT inflation
No, because inflation rates have been in the 3% range, apart from swings, since the early 1900's... The open market operations just started early this year (The big bailout). THAT inflation is entirely from the Fed, but the usual 3% is not. And of course the understanding is that once things are back to normal, the Fed will reverse everything and remove the added currency.
josda1000 wrote:
- There are always downsides to any kind of system, I just believe that metal backed currency is a better way to go than straight paper.
Fair enough.
josda1000 wrote:
Look at the top of a dollar bill: it says Federal Reserve Note. It's an IOU. A bank note. A loan. Whatever you want to call it, it does not have value.
Oh, please, don't start talking like CSS. You understand this stuff better than he does. "Value" is subjective. A thing is worth what people think it's worth. If people think a $100 bill is worth $100 instead of the fraction of a cent it cost to print it, then it is. It's worth that much because you can go to a merchant somewhere and trade that piece of paper for something worth $100. The government could decide that kumquats were suddenly equivalent to $10,000 bills, and if enough people believed them, it would be true. Perception is reality.
josda1000 wrote:
- Slow economic growth? I can live with that, if it's real growth. Look at wall street. Against gold, the dow is crashing. Against the American dollar, it's growing and coming back to normal. Nominal growth may not be real growth. This is a consumer society, not a production society. Think about it.
You can't use the Dow to measure national economic growth. Of course it's rising relative to the dollar, because the Fed intentionally devalued the dollar in order to defuse the credit crunch. Besides that, the market is just a giant psychology experiment. The Dow is where it is because people think that's where it should be. One idiot with a ton of money to burn could raise or lower that price just by buying or selling. On top of that, it's a textbook example of the Prisoner's Dillema[
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josda1000 wrote:
- See my qualifier: It is the only source of our CURRENT inflation
No, because inflation rates have been in the 3% range, apart from swings, since the early 1900's... The open market operations just started early this year (The big bailout). THAT inflation is entirely from the Fed, but the usual 3% is not. And of course the understanding is that once things are back to normal, the Fed will reverse everything and remove the added currency.
josda1000 wrote:
- There are always downsides to any kind of system, I just believe that metal backed currency is a better way to go than straight paper.
Fair enough.
josda1000 wrote:
Look at the top of a dollar bill: it says Federal Reserve Note. It's an IOU. A bank note. A loan. Whatever you want to call it, it does not have value.
Oh, please, don't start talking like CSS. You understand this stuff better than he does. "Value" is subjective. A thing is worth what people think it's worth. If people think a $100 bill is worth $100 instead of the fraction of a cent it cost to print it, then it is. It's worth that much because you can go to a merchant somewhere and trade that piece of paper for something worth $100. The government could decide that kumquats were suddenly equivalent to $10,000 bills, and if enough people believed them, it would be true. Perception is reality.
josda1000 wrote:
- Slow economic growth? I can live with that, if it's real growth. Look at wall street. Against gold, the dow is crashing. Against the American dollar, it's growing and coming back to normal. Nominal growth may not be real growth. This is a consumer society, not a production society. Think about it.
You can't use the Dow to measure national economic growth. Of course it's rising relative to the dollar, because the Fed intentionally devalued the dollar in order to defuse the credit crunch. Besides that, the market is just a giant psychology experiment. The Dow is where it is because people think that's where it should be. One idiot with a ton of money to burn could raise or lower that price just by buying or selling. On top of that, it's a textbook example of the Prisoner's Dillema[
Ian Shlasko wrote:
inflation rates have been in the 3% range, apart from swings, since the early 1900's...
I hope you realize the timing of your quote. Early 1900's: the Federal Reserve was instated in 1913. I'm sorry, call me a conspiracy theorist as I've said to Christian a couple of times, but that is a fact. And I hope you do recognize that.
Ian Shlasko wrote:
The open market operations just started early this year (The big bailout).
This is straight up not true. Railroads. Amtrak. Chrysler. Look into this.
Ian Shlasko wrote:
The open market operations just started early this year (The big bailout). THAT inflation is entirely from the Fed, but the usual 3% is not.
You'd also refuted your own argument here. you'd said that inflation rates have been in the 3% range since the 1900s. That's true; that's when the Federal Reserve was instated in 1913. The dollar has lost 96% of its original value since then. POINT FOR ME! lol jk
Ian Shlasko wrote:
And of course the understanding is that once things are back to normal, the Fed will reverse everything and remove the added currency.
OK, honestly I can't see this happening at all. Looking at the history of Zimbabwe and Argentina, this just doesn't happen. No fiat currency has every survived, it has been said. So right now, call me nervous, but I'm really doubtful of this perception that the Fed will pull back its excessive cash.
Ian Shlasko wrote:
Oh, please, don't start talking like CSS.
Ouch man. lol jk Ok so I was just trying to prove that point. If you think that this part is a conspiracy theory, it's just a conspiracy fact. I don't think that the symbols on it are really a theory, I just know that Federal Reserve Notes are precisely bank notes, and said as such right in front of your eyes. That's why it's a scam, because people believe that paper money is worth something when it really isn't. Let's put it this way, why do you believe that paper money is worth something? Why do you think enough people bought into this fiat currency crap? Come to think of it, why did I all of my life until a year ago...
Ian Shlasko wrote:
Of course it's rising relative to the dollar, because the Fed intentional
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Ian Shlasko wrote:
inflation rates have been in the 3% range, apart from swings, since the early 1900's...
I hope you realize the timing of your quote. Early 1900's: the Federal Reserve was instated in 1913. I'm sorry, call me a conspiracy theorist as I've said to Christian a couple of times, but that is a fact. And I hope you do recognize that.
Ian Shlasko wrote:
The open market operations just started early this year (The big bailout).
This is straight up not true. Railroads. Amtrak. Chrysler. Look into this.
Ian Shlasko wrote:
The open market operations just started early this year (The big bailout). THAT inflation is entirely from the Fed, but the usual 3% is not.
You'd also refuted your own argument here. you'd said that inflation rates have been in the 3% range since the 1900s. That's true; that's when the Federal Reserve was instated in 1913. The dollar has lost 96% of its original value since then. POINT FOR ME! lol jk
Ian Shlasko wrote:
And of course the understanding is that once things are back to normal, the Fed will reverse everything and remove the added currency.
OK, honestly I can't see this happening at all. Looking at the history of Zimbabwe and Argentina, this just doesn't happen. No fiat currency has every survived, it has been said. So right now, call me nervous, but I'm really doubtful of this perception that the Fed will pull back its excessive cash.
Ian Shlasko wrote:
Oh, please, don't start talking like CSS.
Ouch man. lol jk Ok so I was just trying to prove that point. If you think that this part is a conspiracy theory, it's just a conspiracy fact. I don't think that the symbols on it are really a theory, I just know that Federal Reserve Notes are precisely bank notes, and said as such right in front of your eyes. That's why it's a scam, because people believe that paper money is worth something when it really isn't. Let's put it this way, why do you believe that paper money is worth something? Why do you think enough people bought into this fiat currency crap? Come to think of it, why did I all of my life until a year ago...
Ian Shlasko wrote:
Of course it's rising relative to the dollar, because the Fed intentional
josda1000 wrote:
I hope you realize the timing of your quote. Early 1900's: the Federal Reserve was instated in 1913. I'm sorry, call me a conspiracy theorist as I've said to Christian a couple of times, but that is a fact. And I hope you do recognize that.
Yeah, it's when we dropped the gold standard. I'm not disputing that a fiat currency leads to some amount of inflation. I'm saying the Fed itself doesn't cause it.
josda1000 wrote:
This is straight up not true. Railroads. Amtrak. Chrysler. Look into this.
Ok, I misspoke. This wasn't the first time OMO were used... But it's not something they do every day, or even every year. It's what they do when adjusting interest rates isn't enough to stop a depression.
josda1000 wrote:
You'd also refuted your own argument here. you'd said that inflation rates have been in the 3% range since the 1900s. That's true; that's when the Federal Reserve was instated in 1913. The dollar has lost 96% of its original value since then. POINT FOR ME! lol jk
See above... But honestly, the whole "Dollar has lost 96% of its value" line has to stop. The value of today's dollar in relation to 1913's dollar is irrelevant. What matters is what things cost in relation to what people EARN. If over a hundred years, the dollar drops by 95% and salaries are 20 times what they were, then nothing has changed for you.
josda1000 wrote:
OK, honestly I can't see this happening at all. Looking at the history of Zimbabwe and Argentina, this just doesn't happen. No fiat currency has every survived
None of them? What about the Euro? GBP? Pretty much every currency out there is fiat... Almost no one uses the gold standard anymore. You're pointing out the failures but ignoring the ones that are still around.
josda1000 wrote:
Let's put it this way, why do you believe that paper money is worth something? Why do you think enough people bought into this fiat currency crap? Come to think of it, why did I all of my life until a year ago...
You still do. Do you think that McDonalds around the corner will give you food if you give them a few Federal Reserve Notes? Yes? Then you believe in it. You may not believe it's the ideal system, but you have faith in it, and you believe in the value of y
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josda1000 wrote:
I hope you realize the timing of your quote. Early 1900's: the Federal Reserve was instated in 1913. I'm sorry, call me a conspiracy theorist as I've said to Christian a couple of times, but that is a fact. And I hope you do recognize that.
Yeah, it's when we dropped the gold standard. I'm not disputing that a fiat currency leads to some amount of inflation. I'm saying the Fed itself doesn't cause it.
josda1000 wrote:
This is straight up not true. Railroads. Amtrak. Chrysler. Look into this.
Ok, I misspoke. This wasn't the first time OMO were used... But it's not something they do every day, or even every year. It's what they do when adjusting interest rates isn't enough to stop a depression.
josda1000 wrote:
You'd also refuted your own argument here. you'd said that inflation rates have been in the 3% range since the 1900s. That's true; that's when the Federal Reserve was instated in 1913. The dollar has lost 96% of its original value since then. POINT FOR ME! lol jk
See above... But honestly, the whole "Dollar has lost 96% of its value" line has to stop. The value of today's dollar in relation to 1913's dollar is irrelevant. What matters is what things cost in relation to what people EARN. If over a hundred years, the dollar drops by 95% and salaries are 20 times what they were, then nothing has changed for you.
josda1000 wrote:
OK, honestly I can't see this happening at all. Looking at the history of Zimbabwe and Argentina, this just doesn't happen. No fiat currency has every survived
None of them? What about the Euro? GBP? Pretty much every currency out there is fiat... Almost no one uses the gold standard anymore. You're pointing out the failures but ignoring the ones that are still around.
josda1000 wrote:
Let's put it this way, why do you believe that paper money is worth something? Why do you think enough people bought into this fiat currency crap? Come to think of it, why did I all of my life until a year ago...
You still do. Do you think that McDonalds around the corner will give you food if you give them a few Federal Reserve Notes? Yes? Then you believe in it. You may not believe it's the ideal system, but you have faith in it, and you believe in the value of y
I'm sorry but I really do like this debate as well, even though it's killing my brain... But that's why I hold a beer in my hands. Let's continue.
Ian Shlasko wrote:
Yeah, it's when we dropped the gold standard. I'm not disputing that a fiat currency leads to some amount of inflation. I'm saying the Fed itself doesn't cause it.
This is not true, as well. We finally got off the gold standard in 1971, so somehow or another we were backed by some precious metal. We had silver certificates, US Notes, etc.
Ian Shlasko wrote:
It's what they do when adjusting interest rates isn't enough to stop a depression.
I hope that you could do some research, and find that THE FED DOESN'T STOP DEPRESSIONS. If you take a look at that list you sent to me, but look at the dates after it, you'll see that there have been many more recessions in that time than before the Fed was enacted. Their actions make things worse, though the effects are felt about a year or two after their actions. As I've said, you will definitely see this economy come to a halt in the near future.
Ian Shlasko wrote:
the whole "Dollar has lost 96% of its value" line has to stop. The value of today's dollar in relation to 1913's dollar is irrelevant.
This is a comment that I cannot believe I'd read. Like I say, how much does one ounce of gold buy compared to 2000 years ago? Yeah. 2000 years. And I did more research: it's only been 40 years since the dollar lost that 96%. Gold has more or less kept its value over 2000 years while the dollar continues to inflate by 3% each year as you said. And to contine the point, you'd said that we have been inflating by 3% each year. If I get a raise of 3% each year by my employer, am I getting a raise? Or is that rhetoric? I'm not getting a raise at all, am I? It's an illusion. Back when we didn't have this central bank, people were getting real raises. The employer would notice that the man has gained experience in the field, and should get rewarded because that employee is more valuable than he was last year. But getting a 3% raise every year with this crap currency is nonsense. He'd already gotten taxed by the inflation enough to not get a true raise, he's just making ends meet. So: no, this 96% lost value line will contine. Because it makes all of the difference. Sure the ratio to what people earns is the same; but it s
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I'm sorry but I really do like this debate as well, even though it's killing my brain... But that's why I hold a beer in my hands. Let's continue.
Ian Shlasko wrote:
Yeah, it's when we dropped the gold standard. I'm not disputing that a fiat currency leads to some amount of inflation. I'm saying the Fed itself doesn't cause it.
This is not true, as well. We finally got off the gold standard in 1971, so somehow or another we were backed by some precious metal. We had silver certificates, US Notes, etc.
Ian Shlasko wrote:
It's what they do when adjusting interest rates isn't enough to stop a depression.
I hope that you could do some research, and find that THE FED DOESN'T STOP DEPRESSIONS. If you take a look at that list you sent to me, but look at the dates after it, you'll see that there have been many more recessions in that time than before the Fed was enacted. Their actions make things worse, though the effects are felt about a year or two after their actions. As I've said, you will definitely see this economy come to a halt in the near future.
Ian Shlasko wrote:
the whole "Dollar has lost 96% of its value" line has to stop. The value of today's dollar in relation to 1913's dollar is irrelevant.
This is a comment that I cannot believe I'd read. Like I say, how much does one ounce of gold buy compared to 2000 years ago? Yeah. 2000 years. And I did more research: it's only been 40 years since the dollar lost that 96%. Gold has more or less kept its value over 2000 years while the dollar continues to inflate by 3% each year as you said. And to contine the point, you'd said that we have been inflating by 3% each year. If I get a raise of 3% each year by my employer, am I getting a raise? Or is that rhetoric? I'm not getting a raise at all, am I? It's an illusion. Back when we didn't have this central bank, people were getting real raises. The employer would notice that the man has gained experience in the field, and should get rewarded because that employee is more valuable than he was last year. But getting a 3% raise every year with this crap currency is nonsense. He'd already gotten taxed by the inflation enough to not get a true raise, he's just making ends meet. So: no, this 96% lost value line will contine. Because it makes all of the difference. Sure the ratio to what people earns is the same; but it s
josda1000 wrote:
This is not true, as well. We finally got off the gold standard in 1971, so somehow or another we were backed by some precious metal. We had silver certificates, US Notes, etc.
Partially true. Federal Reserve Notes were introduced in 1913, and from that point our currency was only partially gold-backed... I found one source[^] that says convertibility to gold-backed was suspended in the 20s, so I think that means any measurements after that point would be essentially measuring a fiat currency.
josda1000 wrote:
I hope that you could do some research, and find that THE FED DOESN'T STOP DEPRESSIONS.
It doesn't stop them entirely, but it reduces their effects. At least, that's the goal. Granted, they completely screwed up with the Great Depression, but hey, that's beta testing for ya, right? :) The idea is to reduce the amplitude of the sine wave, not remove the downturns entirely.
josda1000 wrote:
This is a comment that I cannot believe I'd read. Like I say, how much does one ounce of gold buy compared to 2000 years ago?... And to contine the point, you'd said that we have been inflating by 3% each year. If I get a raise of 3% each year by my employer, am I getting a raise? Or is that rhetoric? I'm not getting a raise at all, am I?
No, a 3% raise is keeping up with inflation. More than that is a raise. And again, what's this fascination with keeping money under your mattress for 40 years? You make money, and you put it in a savings account (Or invest it)... It gains interest. Not quite as much as inflation if it's in a savings account (Risk = Reward), but $100 in 1913 would not still be $100 today. If your employer wants to give you a REAL raise, they'll up your salary more than the inflationary increase... Simple. If they don't like you, well, zero raise sounds a little nicer than a 3% pay cut, even if it's the same thing. Honestly, what's the difference if the increases in salary and cost-of-living are comparable? If we were all still making salaries comparable to the early 1900s, you'd have an argument. But that's just not the case.
josda1000 wrote:
The euro is wa
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josda1000 wrote:
This is not true, as well. We finally got off the gold standard in 1971, so somehow or another we were backed by some precious metal. We had silver certificates, US Notes, etc.
Partially true. Federal Reserve Notes were introduced in 1913, and from that point our currency was only partially gold-backed... I found one source[^] that says convertibility to gold-backed was suspended in the 20s, so I think that means any measurements after that point would be essentially measuring a fiat currency.
josda1000 wrote:
I hope that you could do some research, and find that THE FED DOESN'T STOP DEPRESSIONS.
It doesn't stop them entirely, but it reduces their effects. At least, that's the goal. Granted, they completely screwed up with the Great Depression, but hey, that's beta testing for ya, right? :) The idea is to reduce the amplitude of the sine wave, not remove the downturns entirely.
josda1000 wrote:
This is a comment that I cannot believe I'd read. Like I say, how much does one ounce of gold buy compared to 2000 years ago?... And to contine the point, you'd said that we have been inflating by 3% each year. If I get a raise of 3% each year by my employer, am I getting a raise? Or is that rhetoric? I'm not getting a raise at all, am I?
No, a 3% raise is keeping up with inflation. More than that is a raise. And again, what's this fascination with keeping money under your mattress for 40 years? You make money, and you put it in a savings account (Or invest it)... It gains interest. Not quite as much as inflation if it's in a savings account (Risk = Reward), but $100 in 1913 would not still be $100 today. If your employer wants to give you a REAL raise, they'll up your salary more than the inflationary increase... Simple. If they don't like you, well, zero raise sounds a little nicer than a 3% pay cut, even if it's the same thing. Honestly, what's the difference if the increases in salary and cost-of-living are comparable? If we were all still making salaries comparable to the early 1900s, you'd have an argument. But that's just not the case.
josda1000 wrote:
The euro is wa
ok i'm pretty much done debating officially. but i will leave you with something found in the new york times today. http://www.nytimes.com/2009/11/23/business/23rates.html?_r=1[^] So the Fed's interest rates have been near zero for about a year, from what I remember. And the public debt is around 12 trillion, as previously described. The Fed will believe that the economy is back to normal because of its own propaganda: The Dow is over 10K again, and we're in a "jobless recovery", whatever the hell that is. So they will reset the interest rates to normal. This will mean that the public will start owing the "Federal Reserve" money, with interest this time. Which means we will never be able to pay it back, unless we inflate the currency. This is precisely what I'm talking about. Read that article, it should help you own your own road to recovery. Come to the light lol jk I'm just saying that all of this talk that "the Fed eases the monetary situation to reduce the sine wave" is bullhonkey. They ease it, for a year. But really they just push the debt off until later, or ease the pain for a short time and then BOOM it's in your face again. So here we go, round 2. I hope you get my drift.
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ok i'm pretty much done debating officially. but i will leave you with something found in the new york times today. http://www.nytimes.com/2009/11/23/business/23rates.html?_r=1[^] So the Fed's interest rates have been near zero for about a year, from what I remember. And the public debt is around 12 trillion, as previously described. The Fed will believe that the economy is back to normal because of its own propaganda: The Dow is over 10K again, and we're in a "jobless recovery", whatever the hell that is. So they will reset the interest rates to normal. This will mean that the public will start owing the "Federal Reserve" money, with interest this time. Which means we will never be able to pay it back, unless we inflate the currency. This is precisely what I'm talking about. Read that article, it should help you own your own road to recovery. Come to the light lol jk I'm just saying that all of this talk that "the Fed eases the monetary situation to reduce the sine wave" is bullhonkey. They ease it, for a year. But really they just push the debt off until later, or ease the pain for a short time and then BOOM it's in your face again. So here we go, round 2. I hope you get my drift.
Yeah, we're mostly screwed. The question, though, is what would have happened if the Fed hadn't acted. All of the major banks and investment firms are so invested with each other that if a couple big ones went down, the entire industry would collapse. And before you say something CSS-style, like "We'd be better off without the banks," just remember the kind of panic that a bank run can lead to... That, plus all of the pension funds and retirement accounts dropping to near-zero. Not good. So maybe the bailout wasn't a perfect solution... But it was better than not doing anything.
Proud to have finally moved to the A-Ark. Which one are you in? Developer, Author (Guardians of Xen)
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Yeah, we're mostly screwed. The question, though, is what would have happened if the Fed hadn't acted. All of the major banks and investment firms are so invested with each other that if a couple big ones went down, the entire industry would collapse. And before you say something CSS-style, like "We'd be better off without the banks," just remember the kind of panic that a bank run can lead to... That, plus all of the pension funds and retirement accounts dropping to near-zero. Not good. So maybe the bailout wasn't a perfect solution... But it was better than not doing anything.
Proud to have finally moved to the A-Ark. Which one are you in? Developer, Author (Guardians of Xen)
Ian Shlasko wrote:
All of the major banks and investment firms are so invested with each other that if a couple big ones went down, the entire industry would collapse.
I hate to say it, but I really think this economy is going to collapse anyway. Plus, we saw many banks fail already, including major banks. So A) I think that the argument as to bailing banks out is bogus, B) the public debt is in dire straits because of it and C) we just pushed the problem on until later. "We must not let our rulers load us with perpetual debt." - Thomas Jefferson
Ian Shlasko wrote:
remember the kind of panic that a bank run can lead to.
Um... bank runs are good. I know that sounds ridiculous, but hear me out. If the people were to try to reclaim THEIR money, then it would end the cycle of debt. People haven't really recognized until now how bad debt really can be. Yes, a depression and bank runs can be very confusing and chaotic. But think about what it's a symptom of: it's the lack of trust in banks to manage money properly. And that's PRECISELY what happened last year. The banks were bailed out because of mismanagement. Again I don't think they should have been bailed out, but that's another part of the problem. A bank being created and controlled by other banks. (Again, not a conspiracy theory; it's conspiracy fact.)
Ian Shlasko wrote:
That, plus all of the pension funds and retirement accounts dropping to near-zero.
This could have been prevented if they kept money under their pillows, as you've so blatantly stated. Why have Italians done it for eons? I'm glad I've kept some of my heritage lol Look, accounts are supposed to be safe from harm. If banks are entitled to use fractional reserve banking, then there is a major risk involved on the part of the customer. I really have lost all trust in banks after last year's crash, and apparently for good reason. It's a Ponzi scheme, just very sophisticated. If you care about the public and their well being, you wouldn't go around telling them to get into debt. You would tell them to save and conserve. There's nothing conservative about debt.
Ian Shlasko wrote:
So maybe the bailout wasn't a perfect solution... But it was better than not doing anything.
I couldn't agree less. The bailout was definitely the wrong "solution"
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Yeah, we're mostly screwed. The question, though, is what would have happened if the Fed hadn't acted. All of the major banks and investment firms are so invested with each other that if a couple big ones went down, the entire industry would collapse. And before you say something CSS-style, like "We'd be better off without the banks," just remember the kind of panic that a bank run can lead to... That, plus all of the pension funds and retirement accounts dropping to near-zero. Not good. So maybe the bailout wasn't a perfect solution... But it was better than not doing anything.
Proud to have finally moved to the A-Ark. Which one are you in? Developer, Author (Guardians of Xen)
http://www.youtube.com/watch?v=eZA0qNsf4m0[^] Please, for the love of God watch this. This is what's going on, and why I protect myself. I think my father is finally starting to listen to me, and that's the kind of thing I care about. I realize this concept is hard to grasp at first, but after awhile, it is just truth and something clicks. I forgive you for working for bear stearns lol
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Ian Shlasko wrote:
All of the major banks and investment firms are so invested with each other that if a couple big ones went down, the entire industry would collapse.
I hate to say it, but I really think this economy is going to collapse anyway. Plus, we saw many banks fail already, including major banks. So A) I think that the argument as to bailing banks out is bogus, B) the public debt is in dire straits because of it and C) we just pushed the problem on until later. "We must not let our rulers load us with perpetual debt." - Thomas Jefferson
Ian Shlasko wrote:
remember the kind of panic that a bank run can lead to.
Um... bank runs are good. I know that sounds ridiculous, but hear me out. If the people were to try to reclaim THEIR money, then it would end the cycle of debt. People haven't really recognized until now how bad debt really can be. Yes, a depression and bank runs can be very confusing and chaotic. But think about what it's a symptom of: it's the lack of trust in banks to manage money properly. And that's PRECISELY what happened last year. The banks were bailed out because of mismanagement. Again I don't think they should have been bailed out, but that's another part of the problem. A bank being created and controlled by other banks. (Again, not a conspiracy theory; it's conspiracy fact.)
Ian Shlasko wrote:
That, plus all of the pension funds and retirement accounts dropping to near-zero.
This could have been prevented if they kept money under their pillows, as you've so blatantly stated. Why have Italians done it for eons? I'm glad I've kept some of my heritage lol Look, accounts are supposed to be safe from harm. If banks are entitled to use fractional reserve banking, then there is a major risk involved on the part of the customer. I really have lost all trust in banks after last year's crash, and apparently for good reason. It's a Ponzi scheme, just very sophisticated. If you care about the public and their well being, you wouldn't go around telling them to get into debt. You would tell them to save and conserve. There's nothing conservative about debt.
Ian Shlasko wrote:
So maybe the bailout wasn't a perfect solution... But it was better than not doing anything.
I couldn't agree less. The bailout was definitely the wrong "solution"
josda1000 wrote:
I hate to say it, but I really think this economy is going to collapse anyway
Quite possibly.
josda1000 wrote:
Um... bank runs are good. I know that sounds ridiculous
Keep in mind that a bank run isn't just "Everyone takes their money out of the bank." A bank run is "The first 20% of the customers who withdraw take their money out, and the rest of them start a riot because they CAN'T withdraw at all (Fractional Reserve Banking, remember?). This is normally where the FDIC steps in and reimburses everyone (Up to 250k each, more with some tricks), but how would the FDIC do that without printing more money? So they print money so everyone can withdraw, and the currency devalues anyway... Better to devalue it first and skip the panic.
josda1000 wrote:
Look, accounts are supposed to be safe from harm
SAVINGS accounts are supposed to be safe from harm. They are, thanks to the FDIC. Investment accounts are inherently risky, and people are informed of this risk before they put money in. Most retirement programs let you put some portion into a "Stable value" fund, which is essentially just treasury bonds. That's safe. But most people don't want to get 2-3% a year when they can put money into more risky assets and pull in 5-15%.
josda1000 wrote:
If banks are entitled to use fractional reserve banking, then there is a major risk involved on the part of the customer
And if they AREN'T allowed to use fractional reserve banking, then you'd be paying for a bank account instead of BEING paid. How does a bank make money if they can't use the deposited funds to make loans and earn interest? The FDIC exists to make sure the money you deposit is safe, but that's dependent on a fiat currency.
josda1000 wrote:
It's a Ponzi scheme, just very sophisticated
I understasnd the point you're trying to make, but that's the wrong analogy. A Ponzi scheme is a very specific form of financial fraud, not just a synonym for "Bad accounting practices."
josda1000 wrote:
I couldn't agree less. The bailout was definitely the wrong "solution". It wasn't a solution. It's called a delay to the inevitable. So I would have taken the red pill and swallowed it hard early. Th
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http://www.youtube.com/watch?v=eZA0qNsf4m0[^] Please, for the love of God watch this. This is what's going on, and why I protect myself. I think my father is finally starting to listen to me, and that's the kind of thing I care about. I realize this concept is hard to grasp at first, but after awhile, it is just truth and something clicks. I forgive you for working for bear stearns lol
Can't get to YouTube from work... Firewalled. If this is another propaganda video or an interview with some politician, though, don't expect it to convince me. Politicians will say whatever their handlers tell them to say, and whatever is most likely to get them reelected. Propaganda videos only show the convenient half of the issue. I try to look at both sides of every issue to properly analyze them... And neither of those sources do that.
Proud to have finally moved to the A-Ark. Which one are you in? Developer, Author (Guardians of Xen)
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josda1000 wrote:
I hate to say it, but I really think this economy is going to collapse anyway
Quite possibly.
josda1000 wrote:
Um... bank runs are good. I know that sounds ridiculous
Keep in mind that a bank run isn't just "Everyone takes their money out of the bank." A bank run is "The first 20% of the customers who withdraw take their money out, and the rest of them start a riot because they CAN'T withdraw at all (Fractional Reserve Banking, remember?). This is normally where the FDIC steps in and reimburses everyone (Up to 250k each, more with some tricks), but how would the FDIC do that without printing more money? So they print money so everyone can withdraw, and the currency devalues anyway... Better to devalue it first and skip the panic.
josda1000 wrote:
Look, accounts are supposed to be safe from harm
SAVINGS accounts are supposed to be safe from harm. They are, thanks to the FDIC. Investment accounts are inherently risky, and people are informed of this risk before they put money in. Most retirement programs let you put some portion into a "Stable value" fund, which is essentially just treasury bonds. That's safe. But most people don't want to get 2-3% a year when they can put money into more risky assets and pull in 5-15%.
josda1000 wrote:
If banks are entitled to use fractional reserve banking, then there is a major risk involved on the part of the customer
And if they AREN'T allowed to use fractional reserve banking, then you'd be paying for a bank account instead of BEING paid. How does a bank make money if they can't use the deposited funds to make loans and earn interest? The FDIC exists to make sure the money you deposit is safe, but that's dependent on a fiat currency.
josda1000 wrote:
It's a Ponzi scheme, just very sophisticated
I understasnd the point you're trying to make, but that's the wrong analogy. A Ponzi scheme is a very specific form of financial fraud, not just a synonym for "Bad accounting practices."
josda1000 wrote:
I couldn't agree less. The bailout was definitely the wrong "solution". It wasn't a solution. It's called a delay to the inevitable. So I would have taken the red pill and swallowed it hard early. Th
Ian Shlasko wrote:
Better to devalue it first and skip the panic.
The point of this whole conversation is to actually recognize that this will come. You've again proved my point. Yes, fractional reserve banking will create these bank runs. Again, you're saying what I've been saying. I think that you should really see this is proving my point; that fiat currencies eventually end. Again, look at the Weimar republic, Zimbabwe, the USSR, etc. I'm glad that you're seeing that the dollar is not immune to the fact that it is now completely and absolutely fiat, and that fiat money will eventually amount to a value of NOTHING, just as the value of the paper it is printed on. You are proving my point sir, and I really hope you open your eyes here.
Ian Shlasko wrote:
SAVINGS accounts are supposed to be safe from harm. They are, thanks to the FDIC. Investment accounts are inherently risky, and people are informed of this risk before they put money in. Most retirement programs let you put some portion into a "Stable value" fund, which is essentially just treasury bonds. That's safe.
No. Treasury bonds are NOT safe. Especially where, as I've said, the dollar is collapsing. They are MORE SAFE, but not completely safe. If inflation occurs at 3% and the treasury bond only aggregates at about 1.5%, you're losing 1.5% a year. But that's not even the point... the point is that the National Debt is over 12 trillion, and even according to the government, the debt will reach 24 trillion in about 8 years. So if the government goes bankrupt, those treasurys don't mean a damned thing.
Ian Shlasko wrote:
A Ponzi scheme is a very specific form of financial fraud, not just a synonym for "Bad accounting practices."
And "Bad Accounting Practices" is just so PC.
Ian Shlasko wrote:
But most people don't want to get 2-3% a year when they can put money into more risky assets and pull in 5-15%.
Two things wrong here. A) you're assuming that you know what most people like. Realize that people are very shy if not downright scared to put their money into investing, but they're bombarded with it everyday on TV. B) True conservatives would not risk that much. But they're told to do it. What I would do is just save the money... but then the money loses value through inflation, so you basically have
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Can't get to YouTube from work... Firewalled. If this is another propaganda video or an interview with some politician, though, don't expect it to convince me. Politicians will say whatever their handlers tell them to say, and whatever is most likely to get them reelected. Propaganda videos only show the convenient half of the issue. I try to look at both sides of every issue to properly analyze them... And neither of those sources do that.
Proud to have finally moved to the A-Ark. Which one are you in? Developer, Author (Guardians of Xen)
What you call propaganda, I call truth. The truth lies in the eyes of the beholder. I'm just asking that you think of both ends of this issue. Inflation is a tax. We were prosperous for not having so many obvious taxes and inflation at the same time back in the 1800s. Now we have income taxes and inflation (more than the natural inflation of gold, obviously). It's just common sense. In 1774, our forefathers fought a revolution on the rise in taxes... up to 2 or 3%. We inflate at 3% (a tax) and then we have so many other taxes. Why do people put up with this? Think about it.
Ian Shlasko wrote:
Politicians will say whatever their handlers tell them to say, and whatever is most likely to get them reelected. Propaganda videos only show the convenient half of the issue.
Good, I'm glad you realize that. So why do you listen to them?
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What you call propaganda, I call truth. The truth lies in the eyes of the beholder. I'm just asking that you think of both ends of this issue. Inflation is a tax. We were prosperous for not having so many obvious taxes and inflation at the same time back in the 1800s. Now we have income taxes and inflation (more than the natural inflation of gold, obviously). It's just common sense. In 1774, our forefathers fought a revolution on the rise in taxes... up to 2 or 3%. We inflate at 3% (a tax) and then we have so many other taxes. Why do people put up with this? Think about it.
Ian Shlasko wrote:
Politicians will say whatever their handlers tell them to say, and whatever is most likely to get them reelected. Propaganda videos only show the convenient half of the issue.
Good, I'm glad you realize that. So why do you listen to them?
josda1000 wrote:
Good, I'm glad you realize that. So why do you listen to them?
I don't listen to politicians to get information. I crawl the Internet for that. On those rare occasions that I watch politicians, it's to see how they present themselves on camera. Personally, I think the primary job of the President is just making us look good to the rest of the world. Dubya made us look like a laughing stock... Obama looks like he has a brain, and that goes a long way.
josda1000 wrote:
I'm just asking that you think of both ends of this issue. Inflation is a tax. We were prosperous for not having so many obvious taxes and inflation at the same time back in the 1800s. Now we have income taxes and inflation (more than the natural inflation of gold, obviously). It's just common sense.
Sure, inflation is a tax... But if we didn't have inflation, the government would just increase the actual tax rate a few percent instead. Net result, we get screwed the same amount. I've actually been reading a few articles on either side of the gold standard issue, and I'm still leaning toward fiat currency. Whether it's being managed properly is debatable, but I don't think the gold standard is the answer.
Proud to have finally moved to the A-Ark. Which one are you in? Developer, Author (Guardians of Xen)
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Ian Shlasko wrote:
Better to devalue it first and skip the panic.
The point of this whole conversation is to actually recognize that this will come. You've again proved my point. Yes, fractional reserve banking will create these bank runs. Again, you're saying what I've been saying. I think that you should really see this is proving my point; that fiat currencies eventually end. Again, look at the Weimar republic, Zimbabwe, the USSR, etc. I'm glad that you're seeing that the dollar is not immune to the fact that it is now completely and absolutely fiat, and that fiat money will eventually amount to a value of NOTHING, just as the value of the paper it is printed on. You are proving my point sir, and I really hope you open your eyes here.
Ian Shlasko wrote:
SAVINGS accounts are supposed to be safe from harm. They are, thanks to the FDIC. Investment accounts are inherently risky, and people are informed of this risk before they put money in. Most retirement programs let you put some portion into a "Stable value" fund, which is essentially just treasury bonds. That's safe.
No. Treasury bonds are NOT safe. Especially where, as I've said, the dollar is collapsing. They are MORE SAFE, but not completely safe. If inflation occurs at 3% and the treasury bond only aggregates at about 1.5%, you're losing 1.5% a year. But that's not even the point... the point is that the National Debt is over 12 trillion, and even according to the government, the debt will reach 24 trillion in about 8 years. So if the government goes bankrupt, those treasurys don't mean a damned thing.
Ian Shlasko wrote:
A Ponzi scheme is a very specific form of financial fraud, not just a synonym for "Bad accounting practices."
And "Bad Accounting Practices" is just so PC.
Ian Shlasko wrote:
But most people don't want to get 2-3% a year when they can put money into more risky assets and pull in 5-15%.
Two things wrong here. A) you're assuming that you know what most people like. Realize that people are very shy if not downright scared to put their money into investing, but they're bombarded with it everyday on TV. B) True conservatives would not risk that much. But they're told to do it. What I would do is just save the money... but then the money loses value through inflation, so you basically have
josda1000 wrote:
The point of this whole conversation is to actually recognize that this will come. You've again proved my point. Yes, fractional reserve banking will create these bank runs
You're misreading. I'm saying that it's better to devalue it BEFORE the bank runs, in order to prevent them.
josda1000 wrote:
So if the government goes bankrupt, those treasurys don't mean a damned thing.
True, but if the government goes bankrupt, I don't think anyone's going to care about the economy anymore, because the entire country would be in anarchy and chaos.
josda1000 wrote:
And "Bad Accounting Practices" is just so PC.
Hey, just talking terminology here... A Ponzi Scheme is a very specific form of fraud... Call it fraud if you want, but calling it a Ponzi Scheme doesn't apply. It's like calling every car crash a DUI. Pick another term if you want, but people are calling every corrupt accountant and cheating hedge fund manager a Ponzi schemer, just because Big Bad Bernie has monopolized the papers so much :)
josda1000 wrote:
Two things wrong here. A) you're assuming that you know what most people like. Realize that people are very shy if not downright scared to put their money into investing, but they're bombarded with it everyday on TV. B) True conservatives would not risk that much. But they're told to do it. What I would do is just save the money... but then the money loses value through inflation, so you basically have to invest in something, or just get gold/silver. There's no choice. But basic human nature tells you to save at least SOME of your money, not to just throw it all into a company and cross your fingers.
People are greedy. It's human nature. Everyone wants more... Ok, not EVERYONE, but generally people want more money. Can you really argue with that? If you want to just keep up with inflation, buy T-Bonds. Sure, it's not as stable as gold-backed, but it's better than losing 3% a year.
josda1000 wrote:
Look, the market always recovers. But it starts with the little man.... I think more of us should do such a thing and not be so freakin scared of what is to come instead of delaying it. We're living in a basic fantasy here. I think you do realize this, you're just angering me on purpose.
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josda1000 wrote:
Good, I'm glad you realize that. So why do you listen to them?
I don't listen to politicians to get information. I crawl the Internet for that. On those rare occasions that I watch politicians, it's to see how they present themselves on camera. Personally, I think the primary job of the President is just making us look good to the rest of the world. Dubya made us look like a laughing stock... Obama looks like he has a brain, and that goes a long way.
josda1000 wrote:
I'm just asking that you think of both ends of this issue. Inflation is a tax. We were prosperous for not having so many obvious taxes and inflation at the same time back in the 1800s. Now we have income taxes and inflation (more than the natural inflation of gold, obviously). It's just common sense.
Sure, inflation is a tax... But if we didn't have inflation, the government would just increase the actual tax rate a few percent instead. Net result, we get screwed the same amount. I've actually been reading a few articles on either side of the gold standard issue, and I'm still leaning toward fiat currency. Whether it's being managed properly is debatable, but I don't think the gold standard is the answer.
Proud to have finally moved to the A-Ark. Which one are you in? Developer, Author (Guardians of Xen)
Ian, this has been a great talk. BTW my name is Josh. So I just wanted to commend you on your end of the debate, and I'd also like to ask if I could use your name on my local cable access show next week. My show is basically an hour long, and I do an episode once every two weeks. My tag line is that it's a libertarian opinion show, explaining how the government is growing and the dollar is losing value. I'd like to use this forum debate in the show, if that's ok with you.
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Ian, this has been a great talk. BTW my name is Josh. So I just wanted to commend you on your end of the debate, and I'd also like to ask if I could use your name on my local cable access show next week. My show is basically an hour long, and I do an episode once every two weeks. My tag line is that it's a libertarian opinion show, explaining how the government is growing and the dollar is losing value. I'd like to use this forum debate in the show, if that's ok with you.
I'd rather you didn't, actually. I have no interest in that kind of publicity. If you want to post the conversation, feel free, but I'd rather my name be left out.
Proud to have finally moved to the A-Ark. Which one are you in? Developer, Author (Guardians of Xen)