Where Does Your Money Come From (cont'd)

You said gold has material uses. I'm saying it didn't 300 years ago. So what is your excuse for why gold is a much superior currency to fiat?

 

When did I say gold wasn't a currency thousands of years ago?

 

Jewelry is not "useful". I'm saying 300 years ago there were no material uses for gold, especially in computers.

 

Lol, no they aren't. Right now very few people buy gold for material uses. And if gold was used as currency, absolutely no one would use gold for anything other than currency.

 

Gold did have non monetary uses 300 years ago. Jewelry for one. Furthermore, we've already been over this. Gold is not a better money because of its non monetary uses. It's a better money because you can't print it.

 

I heard a lecture on an Austrian economics website that stated we could even use titanium as a form of commodity money.

From one perspective, we could lower our costs by having "sturdier" money.

 

Titanium isn't rare.

There is no benefit derived from titanium for use as currency. Whatever lower costs gained from durability is lost in the initial production costs, and material cost.

It's a deflection from the real purpose of this conversation, which is to promote a currency which cannot be artificially inflated at the behest of a Government or a FED.

I believe that our currency liquidity should expand at the rate of our population expansion, plus a factor of our economic activity (total receipts) - and that limit should be imposed upon Congress save for exigent circumstances, like war. As such debt is paid, that additionally provided currency should be then removed from the M0 (Mzero).

There is no reason for this operation to not be undertaken by Congress itself, through the Treasury. The FED is unnecessary - and burdensome - and introduces a cadre of men capable of heavily influencing all aspects of our Government, and our life.

That's why Rothschild said this:

 

So basically, under your theory... the more gold a country finds the worse off they are. Hmmmmm... why is it that the more gold countries found the wealthier they became?

I can't for the life of me figure that out, lol. So basically the countries who found the least amount of gold should be more productive than the ones that found more.

 

I'm still waiting to hear from someone why finding more gold is different than the Govt printing money... economically speaking.

 

Titanium is less resistant to oxidation than gold, and more difficult to shape, but yes, in principle it or any other element could be money, it's just that goal is the best for money.

 

I already told you the differences and the similarities.

 

No, I never said that at all. What I said was that the rate of the discovery of Gold is likely close to the rate of population expansion.

And your second point is silly. A country finding more gold - and therefore becoming more wealthy on the global stage as a result - is different than an individual discovering gold within a country, and becoming more rich in that country as a result.

Overall, however, if scads of gold were to be discovered throughout, the value of gold would drop. Its discovery must generally not outpace the growth of economies, or its value will deflate.

All I said was: wouldn't it be interesting if it turns out that we have historically discovered and mined more gold at about the same rate as economic development and population growth would have required in order to grow economically without much or any inflation?

That makes no sense other than to say that in order to acquire gold, they would have to have something of value to trade.

I've already given you 2 bullet points in post #34 that explain the differences, and PLotor offered you another.

 

More difficult to shape could also mean more difficult to counterfeit; and it may enable more convenience as longer lasing coins.

 

It has the lethal flaws I explained. Titanium isn't more difficult to shape, per se: it's just harder.

Our coins already last 100+ years. Our coins are not the problem.

 

I think it would be easier to counterfeit because its color is common among metals. Titanium coins would not last as long as gold because of golds superior corrosion resistance. Either way, that should be for the market to decide

 

"Let's just print the money to remedy our problems that way we don't have to take it from anyone."

Printing more dollars does not create money. It creates dollars. The true, real money supply cannot be changed by the Fed's idea of increasing "the money supply." Real booms can be caused by, perhaps, huge advancements in technology, or a gold rush, etc. Artificial booms are caused by printing too many dollars, and are, of course, very dangerous since they are what lead to the Great Depression as well as the current recession we find ourselves in today. Ultimately, in the long-run, inflation will even out the value of the printed dollars to maintain the money supply. For a simplified, hypothetical example: if there was $10 trillion in the economy, and then $10 trillion more was printed, there would ultimately be a 50% reduction the value of the dollar. The value of the dollar has decreased by over 95% since the creation of the Federal Reserve; I say it's time to end this monstrosity of artificial "money creating" and use money with intrinsic value, preferably gold or at least backed by gold.

 

You are now at least on the right track. Explain to me what the proper rate of monetary expansion is to match population expansion?

So the more gold they found the more stuff they can buy? Wow, what a concept! *hint hint

So what is the proper "growth of economies"?

First you have to explain to me why that is the most effective rate.

There is no differences. Finding a pile of gold and getting someone to build you a house is no different than printing off paper money and someone building you a house.

 

I already have, and I'm not repeating it.

You haven't paid close attention to most of what I've written. You're so busy being sure that you're correct that you've ignored that which I have said which differs from what you believe.

I also already explained this, but - since I didn't go into detail - I'll provide you some. The answer is...variable. The net receipts of transactions - what I would call real actual GDP - determines what our actual growth is.

Some economic activity instigated by the Government falls under my category; some does not. All private sectors transactions do. I'm talking about actually tracking real wealth creation.

Non-sequitur. There is no "most effective rate".

That would be true - if the credit rating of the issuing entity wasn't questioned (and it has been), and the amount of issuance of currency was strictly kept to the observed growth rate of our economy, sans deleterious economic influence from Government.

I've already explained to you the difference between gold and paper, but you don't seem to buy it.

 

There is absolutely nothing different about an individual willing to build you a house for gold and an individual willing to build you a house for paper.

You guys fail in the world of economics because you focus so much on money instead of on productivity. That's why the more gold people found the more things were built. Think about it.

 

The more gold people found, the more things were built? No. You need more people in order to build more things. Gold was simply the vehicle to allow people to realize value in converting their work into assets they wished to trade for it.

Just like paper - but the difference is that your system allows huge control in the hands of those who aren't elected, and they gain financially from how they control our economy.

And that system allows the Government to borrow endlessly, and the resultant inflation skews the class divide badly. As I've now said 100 times.

And I have additionally proven that the Government spending that you laud isn't creating the return on investment that it is costing.

 

What??? You don't "need" more people to build more things. A person can build more than one house. Which was the example I showed you about the more people who found gold the more houses he was willing to build. This is really simple stuff bro. It's not until he can't build any more houses, the cost of labor increases, or the cost of materials increases will there be inflation.

The Govt pays the Fed's cost of doing business regardless of how much they make. The Fed has no incentives to destroy the country for their personal financial gain... that is just your kook conspiracy theory.

Inflation only screws the class divide if real wages are not rising. That is a function of fiscal policy, not monetary policy. And the Govt has to "borrow" endlessly because we need to continue to increase our money in order to get the growth we want.

 

The more gold people found, the more things were built? No. You need more people in order to build more things. Gold was simply the vehicle to allow people to realize value in converting their work into assets they wished to trade for it.

Just like paper - but the difference is that your system allows huge control in the hands of those who aren't elected, and they gain financially from how they control our economy.

And that system allows the Government to borrow endlessly, and the resultant inflation skews the class divide badly - because it forces people to have assets in order to achieve growth and wealth. The people at the bottom of the income ladder lack that, and - as such - their meager savings and earnings get devalued. As I've now said 100 times.

And I have additionally proven that the Government spending that you laud isn't creating the return on investment that it is costing. While Government spending has averaged a 15.8% increase per year over prior years, GDP growth has averaged only 10.8%.

But what is more alarming isn't just the averages. What is far more alarming is that the trend for Government spending is UP, while the trend for GDP growth is DOWN. It is a direct correlation: the more Government spends, the lower the rate of growth of our GDP.

Explain that, please, as it is one of the more stark correlations available to view, and it was brought to us by your charts - so you must accept the data.

If your system was the proper and correct monetary system, that would not be taking place.

 

You're correct about this response; I shouldn't have said that it just requires more people to build more things. If productivity has been unmet due to opportunity, increased gold counts. There is a tipping point where more gold simply leads to more inflation of all costs, however, at which point productivity levels off.

I'm referencing the fact that the world cannot add gold stores at the rate that the FED can add paper currency.

The Congress should not give this power to an unaccountable entity, and for profit, no less.

I never said that the FED has any incentive to destroy an economy. I said that I do not believe that the FED is capable of keeping our economy on track long term without screwing it up and creating an unsustainable debt paradigm.

Which is exactly what we're seeing now.

And - if you'll notice - they haven't been, for a very long time. Wages have been trailing costs of living.

You've said this too; several times. What you have not offered is evidence that one does not helplessly entrap the other. I do not believe they are separate; it doesn't even make sense that they're separate.

There would be no need to "borrow" if the Government simply printed the money itself, without interest. We could get the growth we want regardless.

Which has been my point the entire time.

 

I am referring to titanium as a commodity that can be used as money and a medium of exchange.

Why would titanium be easier to counterfeit than gold, or more useful in many vending applications?

 

Titanium is not as durable as gold.

Im no metallurgist, but it seems that titanium could more easily be imitated by combinations of other metals than gold- gold has a very different look and feel than all the cheap metals.