Thread: The federal Reserve is the key.

In any case, we already have a form of commodity money in our coins.

Our coins? You mean our zinc pennies and our cupro-nickel quarters or our gold plated dollars? Don't make me laugh. They are crap.

Originally Posted by Norrin Radd

Huh? what are you talking about?

The point was that we have a form of commodity money in our coins and it did not preclude fiat money.

How many industrialized political-economies do not have recourse to the services of a central bank.

It is mostly third world anarchies that don't have central banks or stable currencies.

Originally Posted by Retro Fit

There are many scenarios that could give the death blow to the dollar. The most significant is loss of the petro dollar. If O.P.E.C. were to start selling oil for any currency other then the Dollar, the Dollar would fail practically overnight. If any country like China were to start selling off huge amounts of their Dollar reserves, other countries might panic and begin to do the same, this could trigger the end of the dollar.

Protectionism was only good last millennium. We now know that trade is beneficial in our integrated and global economy.

Originally Posted by Retro Fit

Our coins? You mean our zinc pennies and our cupro-nickel quarters or our gold plated dollars? Don't make me laugh. They are crap.

If those coins have been debased, what makes your premise inapplicable to commodity money under our current regime?

I think the fact that the US has not experienced bankruptcy in its Statism is more indicative of whether or not fiat money is considered legal tender in our political-economy. Consider the fact that commodity money, which has value in and of itself, was easier to discard than is our form of Statism and the fiat money it can engender.

Originally Posted by Retro Fit

If O.P.E.C. were to start selling oil for any currency other then the Dollar,

There'd be a slight adjustment, the federal reserve would compensate, little would change.

If any country like China were to start selling off huge amounts of their Dollar reserves

Their economy would tank, they'd lose the advantage in all of their contracts, people would cease purchasing chinese products due to their new found expense and American manufacturing would experience a boom period.

There'd be a slight adjustment, the federal reserve would compensate, little would change.

The Dollar would fail. The petro dollar has virtually kept us above water for the last 40 years. One of the main reasons we killed Saddaam was because he had sold oil for EURO's in 2000. Iran had plans to sell their oil for EURO's. They have postponed those plans. You don't really think we are so pissed at them for nuclear power do you? And Chavez has traded oil, bartered for doctors with Cuba. We have attempted to assassinate him multiple times.
Everybody knows that if the Petro dollar is lost, the Dollar will tank almost immediately. Do some research on it and see for yourself.

Their economy would tank, they'd lose the advantage in all of their contracts, people would cease purchasing chinese products due to their new found expense and American manufacturing would experience a boom period.

What a load of tripe. Where do you get this stuff? China will lose billions, but her economy is strong. Whether they wait, or do it now, the correction must be made and China knows it...the whole World knows it.

If those coins have been debased, what makes your premise inapplicable to commodity money under our current regime?

What do you mean "if"? Look at a silver dollar from the 1950's then look at today's. It has been debased to say the least. Today's coins are not a commodity based currency. They are little more then token's like you get in Vegas.

I think the fact that the US has not experienced bankruptcy in its Statism is more indicative of whether or not fiat money is considered legal tender in our political-economy. Consider the fact that commodity money, which has value in and of itself, was easier to discard than is our form of Statism and the fiat money it can engender.

Federal reserve notes obviously are considered legal tender. Gold was here before your so called "statisim", and it will still be here long after its gone.

Protectionism was only good last millennium. We now know that trade is beneficial in our integrated and global economy.

What the hell are you talking about? I said nothing about protectionism.

The point was that we have a form of commodity money in our coins and it did not preclude fiat money.

Our coins are not a commodity backed currency because they are sans silver or gold with very little copper.

How many industrialized political-economies do not have recourse to the services of a central bank.

All industrialized nations have fallen under the thumb of the World banking cartel. All have fiat money. The central banks are the problem, not the solution. Isn't that obvious enough? If the Fed is so good how come the economy is so bad? Wasn't the fed charter enacted to eliminate these sort of economic downsides? If so, why have they not fixed the problem? I will tell you why, because they created the problem.

It is mostly third world anarchies that don't have central banks or stable currencies.

Central banks and stable currencies do not go hand in hand. In fact, it is the opposite. Central banks destroy stability.

In order for a commodity to be an effective currency it cannot have its production readily manipulated, or prone to significant changes,

You said it all right here. The fed makes a few keyboard strokes and a trillion dollars appears. That is why fiat money will never be an effective currency. It is to easily manipulated. The temptation is just to great for them to stop inflating the currency because it is just to easy to do.