So, what do you think's going to happen with the US Dollar?

14 years ago

People will 'think this" and "think that" - and it doesn't matter.

No one knows what is going to happen - we just have to wait and see where it goes.

kay

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myob

14 years ago

Don't worry, there will always be plenty of greenbacks to go around. The US Treasury Dept keeps making more everyday.

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money bubble

14 years ago

Originally Posted by myob

Don't worry, there will always be plenty of greenbacks to go around. The US Treasury Dept keeps making more everyday.

that's most assuredly not true... if the govt could just mass produce cash whenever, there wouldn't be this deficit & there'd be no reason for the american people to be taxed so much. The more money there is in circulation, the less it's worth.

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Bradley J Anderson

14 years ago

[DELETED]

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John Henderson

14 years ago

Originally Posted by Bradley J Anderson

That is not true. Each dollar that is printed has to be backed up by an equal amount of a precious metal, which is why we have places like Fort Knox. The paper itself isn't worth squat without the metal to back it up. The paper is used simply for convenience sake. It's a lot easier to carry around a few paper dollars, than bags of gold.

Printing money willy-nilly would cause a serious decrease in the value of the dollar, which would cause a serious increase in inflation.

I too used to believe this, until I saw a film called "Money As Debt" which really opened my eyes to how the world actually works...
money as debt - Google Search

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seasoned

14 years ago

Originally Posted by John Henderson

I too used to believe this, until I saw a film called "Money As Debt" which really opened my eyes to how the world actually works...
money as debt - Google Search

Bradley is talking about the OLD rules! What he said was TRUE up until about 1913! BTW I remember hearing around 1980 that switzerland had about 6 times the gold WE have! EVEN if I had it BACKWARDS, and we had 6 times what they do, it is STILL clear we DON'T have enough! BTW Switzerlands currency is controlled by SWITZERLAND! That's IT! THEY make a mistake, and it is ALL OVER! The US currency is controlled by the US, Germany, Italy, France, Japan, UK, Canada, and Russia. For most of my life, they have been known as the G7. NOW they are the G8 G8 - Wikipedia, the free encyclopedia ! And WHY do they do this? NONE of them has a real currency with value behind it, so they trade currencies, control interest rates, and change laws to try to maintain their currencies value!

So the US has as much a say in THEIR currencies as they each have to the US currency.

As for the Amero? Well, the EU is represented by ther UK, italy, France, and Germany! The Amero would bring mexico in, and make canada and the US basically one voice. If I were canada, I would HATE the idea of the Amero. They have a lot of control they properly used, and would lose if they had an Amero.

BTW 1913 was when the FEDeral reserve, AKA the FED, was created. It did away with the gold standard!

Steve

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Kay King 14 years ago

if the govt could just mass produce cash whenever

It can - and it does - and you are right. When you have too much of anything, it's worth less.
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- seasoned 14 years ago
  
  Originally Posted by Kay King
  
  It can - and it does - and you are right. When you have too much of anything, it's worth less.
  
  Yeah, and they ARE printing more! INFLATION FOLKS! What do you think they mean when they talk about INFLATING the money SUPPLY!?!?!?
  
  Steve
  
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sparckyz

14 years ago

Originally Posted by John Henderson

I too used to believe this, until I saw a film called "Money As Debt" which really opened my eyes to how the world actually works...
money as debt - Google Search

Just watched it on youtube.. Very enlightening!!

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Bill Farnham 14 years ago

Originally Posted by Kay King

No one knows what is going to happen - we just have to wait and see where it goes.

Actually, it's pretty straight forward what is going to happen. Look at it this way...

You've played Monopoly, no doubt. Everyone starts off with $1,500. So the money available to chase the properties is finite and hence the price of the properties relative to the money available is comparetively stable. Very soon you find out you can't afford every property you land on based on the price listed for the property. The velocity at which the board fills up with houses and hotels is gradual.

Now imagine if everyone started out with $15,000. There would be a huge excess of money, yet the number of properties available to purchase, build houses or hotels on would remain the same.

So the inevitable happens...the listed prices for the properties are now out of whack with the money supply. Everybody could buy every property they landed on, and make deals with others to consolidate blocks of properties in order to build hotels on. At first.

But then the inevitable happens...

Soon the cost of a trip around the board with every buildable property you land on having a hotel on it becomes expensive. So the windfall you thought you had because you started out with ten times the amount of currency evaporates.

And then the velocity at which the money supply is drained from those without enough cash resources into the pockets of those with enough cash resources increases rapidly. If two players create a cartel whereby they cooperate with each other to the exclusion of others, they soon will drive the other players out of the game.

This is a very simple concept that can be tried by anyone with the boardgame. First play the game the way the rules state, and then play the game with an inflated money supply. You'll instantly see the dynamics of inflation at work.
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waterotter

14 years ago

This is already being discussed here: Dollar Crisis

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bummed.out 14 years ago

Originally Posted by waterotter

This is already being discussed here: Dollar Crisis

Oops; thanks!
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MissLauraCatella

14 years ago

We're going to have a North American Union currency that's shared among the US, Canada and Mexico... Like the euro. The ultimate goal of the big banks is one world currency... I'm pretty sure.

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RogerAderholdt

14 years ago

Hey Bummed Out...

I don't worry about stuff I have NO CONTROL over. What you DO have control over is your state of MIND and the ACTIONS you take.

Hey Bill... loved your Monopoly Example... it's straight on.

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seasoned

14 years ago

BTW the whole currency idea is that it is supposed to represent the value of WORK! A simplification of the BARTER SYSTEM! In the barter system, I do something for YOU, and YOU do something for ME. With currency, I do something for someone, and they pay me. I can pay you, and you do something for me. If the US had some design that couldn't be counterfeited and printed it on paper, and people in the US accepted it as valuable, the ENTIRE PLANET would accept it as having value as long as there was some product or service the US had that they preferred.

Think of it like a store coupon, or voucher. They are WORTHLESS! They generally give a monitary value of like 1/20 of a penny or some such. TOTALLY WORTHLESS!!!!! People throw them out, etc..... HOWEVER, if it gives you a discount on a product you WANT, you give it that value! You may by a newspaper you DON'T want and may NEVER read just to get that coupon! A WORTHLESS scrap of paper becomes worth $1000 if it gives you a $1000 discount on something you WANT! Of course, if it gives you a million dollar discount on something you DON'T want, it is still WORTHLESS!

The dollar is EXACTLY the same thing except it is supposed to NEVER expire, is supposed to cover EVERYTHING, and the store is supposed to be the ENTIRE US!

Steve

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John Henderson

14 years ago

Originally Posted by seasoned

BTW the whole currency idea is that it is supposed to represent the value of WORK! A simplification of the BARTER SYSTEM! In the barter system, I do something for YOU, and YOU do something for ME. With currency, I do something for someone, and they pay me. I can pay you, and you do something for me. If the US had some design that couldn't be counterfeited and printed it on paper, and people in the US accepted it as valuable, the ENTIRE PLANET would accept it as having value as long as there was some product or service the US had that they preferred.

Hi Steve. Your comments reminded me of an interview conducted with Hugo Bouleau, the author of "The Final Crash" (book written in 2006 which predicted the economic catastrophe of 2007): The Final Crash, by Hugo Bouleau (book review & interview) | Guernsey Gold

Anyway, much of what you say is echoed by Bouleau...

("Guernsey" (pronounced "Gurn-zee"), in case you're wondering, is a small independently-governed island between England and France -- Guernsey - Wikipedia, the free encyclopedia)

The Guernsey Experiment - how do we make money that doesn’t cause inflation?

If you keep printing money for projects you add to the money supply, this will inevitably create inflation. The figures in the US stopped being produced (M3) in 2006 so it isn’t easy to measure it correctly any more (money creation) The velocity argument still holds credence, when you see charts of base money there has been a steady rise since the 70’s in the last two years it has gone straight up!

...

Regarding Guernsey, they had money which rather than having notes saying ‘payable on demand’ they had a sell by date. A government bond has a maturity date, the Guernsey note experiment was done whereby the state or government would create the money for local materials and local people, at the end the debt would have to be cancelled, you create money to do a job then destroy it. When you strip interest out of the equation then it becomes a method of exchange (which is actually the original reason for money existing), and therefore money has no intrinsic value in its own right. It is only when money literally makes money that you have a problem.

But surely when it is coming to the expiration date people spend them like crazy and then cause inflation anyway?

Interestingly they didn’t, the state they would issue more notes on maturity if required, the money supply can be created or destroyed at will. By creating real money to finance real things (eg: town market, town hall) rather than speculative deals then it makes a perpetual income source. The more projects funded, the more rental income and then you have a permanent sinking fund to pay off past debt, you can go on to build harbours, schools etc. (as they did in Guernsey using this system).

During that time there were still private banks, and the local banks complained because they were being sidestepped. Funny enough, Government projects were capped at £40,000 but private banks could print whatever they wanted, but when they were not being used they felt hard done by.

What do you think of alternative currencies: freedom dollars, liberty dollars or other ideas in the USA?

‘In the big picture the use of precious metals is the best, naturally there is downside in the mercantilist effect of everybody going all out to accumulate gold, but as long as the mechanism is there it can work. On local level these things happen by themselves, in Germany during the late 1920’s/early 1930’s people used a local currency, Nazi’s stopped it when they took power. The likes of ‘Liberty dollars’ are a different story, the creators of them got arrested, its a little disturbing, it wasn’t harming anybody, it is clearly the IRS using bully tactics because they can, the founding fathers of america were real hero’s, they would not have agreed to that kind of approach.’

Bouleau (writing under his real name of Toby Birch) has written an excellent 'nuts and bolts' explanation of how the Guernsey Experiment actually worked...
The Guernsey Experiment -- Gold News

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seasoned

14 years ago

Well, Apparently Germany, around the war, had currency that had an expiration date. It was my understanding that they were to simply take it to the banks to exchange it. I'm sure the US did something similar with confederate currency.

Besides, look at the BIG picture. If buyers were more likely to spend, wouldn't sellers be less likely to accept?

BTW the reason for the expiration date was that inflation was SO high that some of the bills were HUGE even by TODAY'S standards. Look at the Japanese! Their prices look SKY HIGH! We here a LOT about the YEN! Most countries, like austria and canada, etc.... have a main currency that has a real value to it. Today, USD 1=1, GBP 1=.5986, EUR 1=.6754, JPY 1=81.195. So the japanese yen SOUNDS like it is worth very little, but it actually skyrocketed. It is generally OVER 100 to the dollar. Still, if something HERE costs $100, in japan it might be priced at 8,120!

Inflation in germany was FAR worse.

Anyway, tying currency to precious metals is OBVIOUSLY BEST for THREE reasons! They are cherished(throughout history. Gold doesn''t corrode, and is VERY malleable. It may be the ONLY metal with either being the case to that degree! It also looks nice. Don't ask me WHY the others are so valuable, but they ARE.) ALSO, they have a LOT of industrial uses AND, they are hard to get! That means that using them limits the currency you can print AND sets a floor on the value.

Steve

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fantasticjackson

14 years ago

money doesnt dissappear. it just gets exchanged, flowing to the best hustlers

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seasoned 14 years ago

Originally Posted by erockula

money doesnt dissappear. it just gets exchanged, flowing to the best hustlers

OK, let me explain.....

Let's say 10 trillion dollars exist.

You print 10 trillion MORE dollars!

You now have 20 trillion dollars! RIGHT!?!?!?!? RIGHT!?!?!?!?!?!? WRONG!!!!!!!!!!!!!!!!

It is NOT 10+10=20! It is (10+10)/2=10! Each dollar is worth HALF of what it was because it represents half the value it used to. That extra 10 trillion may be used to bail out a bank ****OR**** pay for welfare, or unemployment. Still, people that have saved all their lives now have their investments CUT IN HALF! SURE, everything LOOKS the same. The value on all the 401Ks, IRAS, etc... looks the same. They just now need TWICE as much to retire. MAN, I have been here only about 50 years, and I have seen this happen a LOT! I have as much as I originally determined I needed to retire, but I need about 10 TIMES as much, last time I figured it out. Why is it so hard to understand?

Take a pie! Cut it into 10 slices. Take another pie that is the SAME size, and cut it into 20 slices. WHICH pie is bigger? Is the one with twice the slices twice as valuable? This is the EXACT same thing the FED is doing. Got it?

And YEAH, you're right! Money doesn't just disappear! LIKEWISE, it doesn't just appear!

Steve
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Regional Warrior

14 years ago

The Australian dollar touched a new post-float high early today as it continues stalking the 110 US cents mark.
The Aussie hit 109.93 US cents shortly after 8am but had fallen back to 109.79 US cents about half an hour later, according to Bloomberg data.
The latest high continues a record-breaking run for the local unit.
If you want to read more the story continues below
Late last week, it leapt the 109 US cent barrier to make a run at 110 US cents. At 3.30pm yesterday the currency was trading at $109.70, up from 109.10 US cents on Friday.

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brendan9971

14 years ago

The US dollar is killing me since my income is entirely based upon the dollar. I was much happier a couple of years ago. I think I need to re evaluate my pricing in order to compensate for the poor performance of the dollar.