Currency Issues - Want Answers
I have been following the news closely about auditing and ending the Fed. Ron Paul's relentless efforts in this regard are priceless. I haven't had any disagreements with Congressman Paul's ideas until recently. I am having trouble understanding his position on the proposed solutions for currency.
1. Ron Paul would like to replace our current currency with a gold standard
2. He does not like the idea of the government being in control of our currency. He would like to see competing currencies. (Recent CSPAN2 End the Fed review with Ron Paul)
I see the following problems with these ideas...
1. The idea of government coining the currency and controlling its value is permitted by the Constitution. I believe this is one of the government's core functions and I also believe it is the right thing to do. Congressman Paul does not like the idea of government monopolizing the currency/money supply. Why is he going against the constitution on this particular issue?
2. Remember the golden rule? Those who have gold make the rules. Going to gold standard appears to put the very Fed we are trying to eliminate back into power because of the high concentrations of gold reserves the Fed and it's allies maintain.
3. Having competing currencies in the market is advocated by Congressman Paul. I am not sure how well this will work. This may actually end up being a distraction to real progress and may in turn cause a lot of confusion. Another danger I see is; what if the different currencies start cooperating instead of competing? Wouldn't this create a situation much like the Fed? Current money masters (Fed, Goldman Sachs, etc.) have the mindset, the infrastructure, allowing these entities to start monopolizing the money supply in no time and start controlling everything once again.
Folks, please explain to me how these problems can be avoided with the proposed gold standard and the private currencies.
Response:
Paul advocates allowing the market to regulate the value of money for a few reasons
As far as cooperating.... What do you mean? You think they'll start inflating the private currency too? If they do, then no one will use it. The only way to get people to voluntarily use a currency is to keep it stable.
Constitution is
Constitution is permitting/prohibiting something because it is a good idea. Not the other way around.
1.1.1 The problem is due to the congress passing its authority on money monopoly to the Fed. All the special interests started dictating the congress because it lost its power it is supposed to maintain.
2. You are assuming that the Fed is holding the gold reserves for the country. Many fear that is not the case. The gold reserves have not been audited for the past 50 years or so. In the recent hearings on HR1207 Alan Grayson was asking the Fed if GAO could audit the gold reserves. Here is the link:
http://www.youtube.com/watch?v=EuvZLJYO_WU
3. Competing currencies defeat the purpose. We need a nationwide standard currency for expressing values of all goods, services, "pain&suffering", etc. so people could carry on their business most effectively. Competing currencies is like having competing gallon size standards. Which is why the constitution gives monopoly on money supply and regulating its value to the congress and prohibits the states from coining the money (other than gold and silver). The currency standard also promotes international trade.
Focus on auditing the Fed ... everything else is a distraction.
Response to Response
Thanks for the explanation regarding Ron Paul's strategy. I wanted to address the details you brought up as I think we can do much better.
dlind wrote:
1. Just because something is permitted by the constitution doesn't mean it is a good idea. Case and point the three-fifths compromise, Prohibition, etc.
Response:
When a nation allows a private cartel to issue and control it's money then it is effectively becoming a client state to that system. The greatest power and creative benefit a sovereign nation holds is it's ability to issue and control it's own money. We are neither sovereign nor free if we must depend on private banks to run our economy.
dlind wrote:
1. By getting congress out of business of managing the money supply they would be unable to inflate in order to pay for wars and social programs; that is unless they tax the hell out of people-- which would be political suicide. Basically it cuts off funding for our bloated federal government and forces it to slim down.
Response: I disagree completely, private banks should get out of government's business. You are creating a red herring in saying that government will issue too much money. Government hasn't issued any money for almost 100 years (except for a small amount in 1963).
The private Federal Reserve lends the government all it wants with a tacit agreement that it never has to pay the principal. This is why government spending is out of control.
END the FED before it ENDS US
END the FED before it ENDS US
We don't have near enough gold
Proponents of the gold standard are practicing a belief system rather than using simple math to end the myth.
The U.S. has at MOST - 3,100 metric tonnes of gold, or 99,665,000 troy ounces.
Here is a link to substantiate that amount
Money supply (M3) is almost $15 trillion
Here is a link to substantiate that amount
In order to back up $15 trillion with 3,100 metric tonnes, the price of gold would need to increase to over $150,000 / troy ounce.
Our national debt interest payment this year will probably be around $600 billion; that expense alone would require over 18,000 tonnes of gold (at $1,000 / troy ounce).
All of our gold would be gone within a few months from interest debt alone.
Backing our currency with gold is neither possible or desirable. I personally own gold and silver, and think it is a great way to store wealth but it's a lousy idea to try and back up our currency with it.
END the FED before it ENDS US
END the FED before it ENDS US
who says we have to back our
who says we have to back our existing currency?
when it fails it fails.
loans will be defaulted on, written down, and written off.
when an individual goes bankrupt, you tell your debtors, "here's your chance, you can get 5 cents on the dollar now, or later you'll get nothing."
when a country goes broke, (and we're already broke, by several decades), we'll do the very same thing.
assets will be liquidated, the value of gold,silver and copper will spike, making it even easier to pay those most important debts (the unimportant ones will be simply wiped away).
perhaps someone or many someones will declare war on us, for leaving them in the lurch, and they'll send the repo man over to our homeland to collect. could get messy.
and leading up to that, gold/silver/copper will have become the defacto precious metal standard, not one declared by the government, but one that emerges naturally, as money used to do all the time, till central bankers colluded with governments, and socialized our money.
crony capitalism built on socialist money.
nice.
Ron Paul is asking for us to return to sanity, to avoid an ugly version of the above scenario. Protect the dollar. Embrace free market derived competing currencies.
You keep harping on the idea that Ron Paul wants us to return to the Gold Standard. I think you're have a problem with comprehension.
He has stated many times that the reason we're up the creek is because we left the gold standard. He's not saying that going back to a government controlled gold standard is the solution.
If we stay on the path paved by the mainstream republican and democratic parties, we will be the next rome. we will be screwed.
We can delay that or prevent it, at least on the fiscal side, by protecting the dollar, and encouraging competing currencies, among many other things. That is Ron Paul's goal, in my opinion. To soften the transition.
Softer transition requires competing currencies, and a protected dollar, it requires states to be unencumbered so that they may each try and find the most logical way to deal with the looming crisis so that some will succeed, and the some won't (we all fail together is bunch of shit), it requires a major come-to-jesus realization of the federal government that they need to be chopped down in size, in half would be a good start, the IRS needs to be disbanded.
All these things will prevent an ugly transition. It takes wasted resources from the government, and puts it back in the hands of the people, who will have to solve their own problems.
You're getting caught up on how many zeroes are after the sum total of debt. It's irrelevant, and totally pointless, and it's tiresome.
That debt currency will be reconciled.
But not the way you keep trying to setup your strawman...
It will
When the dollar collapses, the price of gold WILL be $150,000 an ounce and more. An ounce of gold would have cost a quadrillion German Marks or Zimbabwe dollars.
The astronomical quantity of dollars in circulation is the result of inflation, not a representation of actual value. It is an illusion. And the illusion is coming to an end. Then the numbers you cite will be meaningless.
I don't advocate trying to "back" Federal Reserve dollars with gold and neither does Ron Paul. I advocate giving the people back the freedom to choose their own money and let the transition happen gradually as people choose. Perhaps people will choose paper napkins or turds or whatever you advocate. But I will bet history repeats itself.
The amount of gold doesn't matter one bit!
DrKrbyLuv, how about this:
1. Abolish all Legal Tender Laws
2. Prosecute Fraud (i.e. like Fractional Reserve Banking, Counterfeiting)
And then we the people can use whatever we want as our medium of exchange(I believe this is called competing currencies)...but, as Ron Paul has stated numerous times, natually over time people will gravitate towards using gold, silver, and possibly other metals because of their ease of use as a medium of exchange.
The problem isn't fiat currerncy, the problem is DEBT currency
I agree the amount of gold doesn't matter, the real culprit is that every dollar (FRN) is debt. We borrow every dollar into existence, with interest to private bankers applied.
This is unsustainable as the money supply must continuously expand to make interest payments and to off-set the FRNs that are retired from the economy in satisfying debt.
It doesn't matter if the currency is gold, paper or sea shells, the exponential growth of debt interest will eventually collapse the system.
END the FED before it ENDS US
END the FED before it ENDS US
Exactly!
That's why we need to abolish all Legal Tender Laws and Prosecute Fraud! Why would someone use a FRN debt note if they could use a sound currency like the Liberty Dollar? The international Banksters can have all the FRN's they want...because as soon as you have competing currencies then the FRN's won't be worth the paper they're printed on.
Greenbacks issued by the treasury
Gold has been manipulated since it began it's life as a medium.
Just agree on the slips of paper. Keep the process out in the open. Increase the slips of paper with an increase of population. and vice versa.
Look around you there are many mediums. they work if the two parties agree. Not that complicated.
The effing SYSTEM we have now is NOT immoral. It is the men who have instituted it and control it that are IMMORAL.
Stop pointing at buildings and organizations and blaming them for our problems. Stop suggesting that a new system will solve our GD problems.
Our problems are seated in a group of immoral men who we allow to master over us. They are the problem. Gold is an effing mineral stop worshipping it. It only helps the men in power. It is how they got there in the first place.
Expose the owners of the fed.
Unify
Sorry
I don't trust your slips of paper. Show me a slip of paper that cannot be printed in infinite quantitites and we will talk.
Until then, I'll stick to something that cannot be made in infinite quantitites.
You may choose to do something different.
Morality trumps your imagination
Fundamentally this is a moral issue. People should be free to trade what they want. Enough said. That said:
1. Actually RP wants the market to select the standard. He simply believes it will select gold. He would not decree a gold standard.
2.1. See my original point. You have no moral right to restrict me from coining my own currency. Your imagination that things would be better if you rape my moral choice doesn't trump my moral choice.
2.2. See point 1.
2.3. Grow a moral spine please.
Immoral fractional reserve banking is the underlying problem...
SIMPLY STATED...THE BANKS DO NOT HAVE OUR MONEY.
IF EVERYONE WENT TO GET THEIR DEPOSITS AT ONCE, THE WHOLE SYSTEM WOULD FALL ON ITS FACE QUICKLY.
So when banking's premise became unethical, gold backing (which IS ethical) didn't work anymore.
This is where we're at today.
The FED who regulates and overlooks all of banking are propping up an IMMORAL system by IMMORAL means.
The solution would definetely cause lots of chaos in transitioning back to moral banking and that is what everyone (even liberty lovers on this site) fear so much when Ron Paul suggests his solution.
BUT REMEMBER---IT IS THE SCARCITY OF COMMODITY-BACKED MONEY (IN THIS CASE GOLD) WHICH CAUSES THE MONEY SUPPLY TO BE LIMITED WHICH IN TURN ALLOWS MONEY TO HOLD ITS VALUE OVER TIME...
AND IT CAUSES PEOPLE TO LIVE WITHIN THEIR MEANS SO THEY CAN'T PASS THEIR DEBTS ON TO FUTURE GENERATIONS.
OUR IMMORAL MONETARY POLICY WILL END...
RON PAUL HAS SIMPLEY STATED THAT IT''S A MATTER OF HOW WE WANT IT TO END...
AND IF WE STAY ON THIS TRACK IT WILL NOT END WELL.
READ THESE 2 BOOKS; "WHAT HAS GOVERNMENT DONE TO OUR MONEY" by MURRAY ROTHBARD and "END THE FED" by RON PAUL.
"We have allowed our nation to be over-taxed, over-regulated, and overrun by bureaucrats. The founders would be ashamed of us for what we are putting up with."
-Ron Paul
Bimetallism
He is against bimetallism: : the use of two metals (as gold and silver) jointly as a monetary standard with both constituting legal tender at a predetermined ratio.
They should not have a fixed ratio between the two and their value should be determined by the free market.
Those Who Balk the Gold Standard Ron Paul is Suggesting
The $900 to 1 oz gold ratio has no merrit in a non-fiat system.
If there is only 3100 metric tonnes of gold in the U.S -- We will value each oz differently.
Competition will drive prices down as the demand for goods exchanged in gold goes up -- it will cost too much for those hording it now to hold on.
Soon the horded gold will be in mass circulation.
Gold is artifically high owing to fiat dollars -- get rid of the fiat dollars and golds value will fall.
Now this is not the case for a falling dollar -- as dollar falls gold rises (in "real" terms and in speculative terms).
But eliminating it swiftly would make the dollar useless and new "trade" based measurements for the gold-dollar would come into play -- if competitive then golds value will drop quickly -- "the cost of holding it."
Those who use it first and fast will make the most in tradable goods or services.
Octobox
*&^ Constitution --- Constitutional Rationality
Mr. Octobox I consider you the worst troll on the D.P.
Why?
Because without doing research you give invalid opinions.
Here is a link to the "Claimed" official Gold holdings:
http://www.treas.gov/press/releases/20091061448345281.htm
You will see that 261,499,000 million ounces are claimed. { Ron Paul's H.R. 1207 wants to confirm this number with an audit }
261,499,000 divided by 32,151 ounces in a metric tonne equals 8,139.46396....metric tonnes of Gold.
This is Gold under government control,,,but how many tonnes are already in private hands by the millions of people around the world that are currently buying Gold, which is driving the price to new highs everyday recently.
You wrote," Gold is artifically high owing to fiat dollars -- get rid of the fiat dollars and golds value will fall."
Ha Ha, fall to what? Gold is measured to how much currency it takes to buy it in every country in the world.
If there are no fiat currencies you tell me the "value" of Gold, please.
From past posts I credit you with a good brain,,,but that brain does you no good at all without backing up your words with verify-able research to back your words.
beesting
Beesting: I think your emotionalism precedes your legal tender
I didn't claim how much gold there was -- Someone down below did, I was arguing against their sub-point, that gold is horded and has no value to us (the little holders).
You are the WORST debator on DP.
You quoted me, made my own argument, then left off my conclusion which answers your question -- hahahahahaha.
Yes I said, "Gold is artifically high owing to fiat dollars -- get rid of the fiat dollars and golds value will fall."
You left off the conclusion: ".................new "trade" based measurements for the gold-dollar would come into play -- if competitive then golds value will drop quickly -- "the cost of holding it."
I said "drop fiat dollars" -- see it there *pointing*
Then I mention "gold-dollar" (gold backed).
I also said, "new 'trade' based measurements" -- Meaning if you struck fiat down -- then people would trade in gold; eventually currencies or credit backed by gold would be created -- however, prior to the latter gold and commodities / services / labor would be traded Flea Market style.
I was referring to a swift elimination of fiat -- as you quoted me saying.
Please, pay attention or stay on the bench -- Reading is Fundemental.
Octobox
*&^ Constitution --- Constitutional Rationality
It can be considered emotionalism.
But it's caused by outrages statements that you sir, make without checking any facts or posting links.
Then trying to cover up by talking gobble-de-gook that only Alan Greenspan understands.
Reading your mind without clear explanations is impossible, why don't you stay on the bench.
beesting
Beesting: Did you just give me a "I know you are but what am I"
kind of repartee's, hahahahaha.
"I'm rubber your glue......."
Look -- If you read the other post you would have seen it -- also, it is "clear" in my righting that I'm referring to someone "elses" number and not my own.
In fact go to the top of the posts -- you'll see the person who is making; it's DrKrbyLuv, now you make sure you go attack him.
I said "If there is only 3100 metric tonnes of gold....."
"IF" -- As in if that number is right -- this type of language means I'm arguing a sub-point that this "number" is attached too -- the "number" is irrelevant.
Look -- You jumped on my post because you don't like me. I don't have a "feeling towards" you because you are a font and username. I don't know you.
For me internet blogging is a little "man in the mirror" for me -- am I arguing with literal people or just a savvy computer program inside the Matrix, hahahahaha.
Octobox
*&^ Constitution --- Constitutional Rationality
Ron Paul is dead wrong on issues of currency
I totally agree, I really like Ron Paul and agree with him on many issues but he is dead wrong on currency.
First of all, we have very little gold. I think the total amount of gold the U.S. holds is AT BEST 3,100 metric tonnes. At today's, price, that's around $100 billion.
You're right, those who have the gold write the rules and it sure won't be us if we move to a gold standard.
He is against constitutional money as he doesn't want government controlling and issuing the dollar. This is a fundamental issue - we have two supreme powers, one to issue money and the other to wage war.
In my opinion, he doesn't think people can rule themselves if we can't even issue our own money. To be frank, I think Ron Paul is an obstacle to the real money reformers - I hope that's by accident.
END the FED before it ENDS US
END the FED before it ENDS US
He is not set on a gold standard.
He wants freedom. and none of these stupid legal tender laws.
Ron Paul 2012
www.josiahgarber.com/blog
www.heirloomgardenpro.com
www.mennonitesforronpaul.com
Having competing currencies
Having competing currencies is to be used as a transition from what I gather. Then all money coined/created will not be debt based like it is today and the amount of currency in circulation would be set based on a precious metals so 2-4% inflation rates.
That's what I understood.
"Human beings with love and compassion are some of the most beautiful creatures in the universe... Those without are a plague on us all."
"Human beings with love and compassion are some of the most beautiful creatures in the universe... Those without are a plague on us all."
Ron Paul is not an obstacle
Ron Paul is not an obstacle to the real money reform. In fact, he is the energy behind it.
However, before adopting the gold standard, your point needs to be considered. This is one of my concerns.
Focus on auditing the Fed ... everything else is a distraction.
Gold standard
The gold standard was adopted by the U.S. (encouraged by Great Britain) in 1900. Unfortunately, the U.S. didn't have enough gold to keep up with Fed and fractional lending. It has been argued that from the first day, there wasn't enough gold.
In the early 1930's, people began redeeming their dollars (federal reserve notes) for gold. This was an inconvenient problem as there was not near enough gold in reserves.
The gold standard failed in 1930 in Great Britain and other countries, It finally failed in the the U.S. in 1933. FDR tried to pass the blame by creating a bogeyman called "gold hoarders" but the truth was that there wasn't near enough gold to back up the currency.
There was NO reason to confiscate the people's gold. It was government theft pure and simple. When the U.S. went off the gold standard, it ended their need to keep any gold since the money couldn't be redeemed domestically. The international window was kept open to allow the big banking cartel to sack our treasury and gold reserves.
Anyone who advocates moving back to a gold standard should first explain how much gold would be needed. I'd like to know in tons or dollars how much would be required.
Our M3 is almost $15 trillion, so how much gold would be required to back up that amount?
END the FED before it ENDS US
END the FED before it ENDS US
Re: Gold standard
I may be wrong, but I find your comment,
".........the truth was that there wasn't near enough gold to back up the currency,"
to be a common but incorrect belief.
I believe that this "not enough" belief is precisely a reason why THERE IS ENOUGH. Because it is the rarity that causes it to increase in value.
Thus, in another way, when gold coinage is "thinned out" via distribution amongst the masses that is a form of making it more rare, thus giving it more concentrated, intrensic value.
Again, I my be wrong but I think it is very hard to prove either way.
But THAT can't happen here! * Because some animals are more equal than others -Animal Farm- * A patriot is someone who supports their country all the time and the government when it deserves it. -Mark Twain-
http://www.youtube.com/watch?v=6MTIwY3_-ks
You're right !
There is nothing mentioned in the Constitution about fractional reserve lending.
It is the bankers creation and through out history has been condemned by many.
The ancient name is "Usury"! Please read this:
http://www.alastairmcintosh.com/articles/1998_usury.htm
Why is usury un-compatible with a Gold based system?
Simple, Gold cannot be created out of thin air like I.O.U. notes can.
Years ago fractional reserve lending was very strictly controlled by laws against usury, however over time greed overcame good common sense when it came to lending, and look at the mess it has caused in the world today.
Early banks {1860's-1912 } only charged a small amount to safeguard Gold deposits.
I had a library book that described a bank called Beekman's bank in Jacksonville Oregon:
http://blog.wellsfargo.com/GuidedByHistory/2008/07/cornelius...
According to the library book I read, Mr. Beekman charged a 1% storage charge to Gold depositors and only lent his own personal money {Gold} to borrowers, that paid back loans in Gold. This was a private bank that survived for many years in an area settled by Gold miners.
beesting
You (Beesting) really hit the nail on the head...
It is immoral fractional reserve banking which is the underlying problem.
SIMPLY STATED: THE BANKS DO NOT HAVE OUR MONEY.
IF EVERYONE WENT TO GET THEIR DEPOSITS AT ONCE, THE WHOLE SYSTEM WOULD FALL ON ITS FACE QUICKLY.
So when banking's premise became unethical, gold backing (which IS ethical) didn't work anymore.
That is where we are at today.
The FED who regulates and overlooks all of banking are propping up an IMMORAL system by IMMORAL means.
The solution would definetely cause lots of chaos in transitioning back to moral banking and that is what everyone (even liberty lovers on this site) fear so much when Ron Paul suggests his solution.
"We have allowed our nation to be over-taxed, over-regulated, and overrun by bureaucrats. The founders would be ashamed of us for what we are putting up with."
-Ron Paul
Thank you.
Here is a snip from the link on usury above:
{snip} "
The concept of “usury” has a long historical life, throughout most of which it has been understood to refer to the practice of charging financial interest in excess of the principle amount of a loan, although in some instances and more especially in more recent times, it has been interpreted as interest above the legal or socially acceptable rate[i]. "
beesting
Usury, Polygamy, Pot-smoking, Prayer
All pretty much nobody's business except those directly involved
Life can be as simple as:
"Permit" all voluntary activity,
Prohibit all fraud and aggression.
LXXI BC: Ego sum Spartacus // MDCCCLVII: I am Dred Scott // MCMVL: Ich bin Anne Frank // MMX: Je suis Assange // MMXI: Ik ben von NotHaus
Have you ever used a credit card?
The interest charged is usury because it is totally excessive thanks to the corrupt banking/government partnership !
beesting