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Very Hot Topic (More than 25 Replies) The Return to the Gold Standard (Read 1549 times)
BobK71
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Re: The Return to the Gold Standard
Reply #110 - Nov 5th, 2018 at 9:29am
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SkyChief wrote on Nov 3rd, 2018 at 12:26pm:
This is what real money looks like.


This belief may be profitable today, but not when the elites jettisoned silver from 'money' and only recognized gold at the start of the international gold standard in the 1870s.

As always, we have to take the same strategy as the elites to survive in this shark-eat-fish world.  Be clear eyed (especially as to the elites' real motivation!) and data driven, think outside the box, and position ourselves not to squeeze every last bit of return but to avoid the biggest mistakes.

If you were born in 1870, you could live 100 years and silver would have been down over your lifetime in dollar terms, never mind purchasing power.  This when silver is arguably an even better money than gold.  This is the way of the world.  We're probably better off buying both precious metals and cryptocurrenceis, at this juncture.
  
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Snarky Sack
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Re: The Return to the Gold Standard
Reply #111 - Nov 5th, 2018 at 11:08am
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BobK71 wrote on Nov 5th, 2018 at 9:29am:
If you were born in 1870, you could live 100 years and silver would have been down over your lifetime in dollar terms, never mind purchasing power.  This when silver is arguably an even better money than gold.  This is the way of the world.  We're probably better off buying both precious metals and cryptocurrenceis, at this juncture.


I agree that silver makes for better money than gold.  Ideally, we could have gold money coins and paper currency backed by gold coins or bullion along with silver coins for portability.  No "dollar" just 5 Oz., 1 Oz, .5 Oz, .1 Oz, etc. silver or gold.  Contracts to specify medium of payment.

Many contracts did just that which is why the Republicans and Democrats screwed so many people when this happened:

Quote:
On June 5, 1933, at the behest of the president, Congress took the next step, passing a joint resolution making it illegal to "require payment in gold or a particular kind of coin or currency, or in an amount in money of the United States measured thereby." Any provision in a private or public contract promising payment in gold was thereby nullified. Payment could be made in whatever the government declared to be legal tender, and gold could not be used even as a yardstick for determining how much paper money would be owed.

For the next six months President Roosevelt pursued an erratic monetary course. Every day a new gold price was declared, on a basis no one could figure out. Private lending in effect came to a halt, with the value of the dollar in constant flux amid the prospect of ongoing devaluation. As Senator Carter Glass (D-VA) put it, "No man outside of a lunatic asylum will loan his money today on a farm mortgage." And thus the government could triumphantly announce that since the private sector was cruelly depriving Americans of credit, it would have to step in and provide relief.


Every statist's favorite trick is to blame freedom for a problem created by government and then propose an even worse government solution.

Can you explain why cryptocurrency is a good medium of exchange?  I have a situation in which I am paid for certain services in bitcoin and my biggest challenge right now is converting it to fiat before it bleeds value.

Also, I believe the ideal backing for the dollar besides precious metal would be Jack in the Box tacos.  they're the same 2 for $.99 as when I was a teenager forty years ago and they are nature's perfect fast food!


  

"I think I'll backtrack." - Jeff
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The Opposition
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Re: The Return to the Gold Standard
Reply #112 - Nov 5th, 2018 at 11:11am
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BobK71 wrote on Nov 5th, 2018 at 9:10am:
When the elites repeatedly designed a system that failed always and in the same way, you have to start questioning if their intent was as stated in the first place.


They simply position themselves to seize large amounts of real property each collapse.

Because they don't do anything, or produce anything, they need this property to slowly sell off at a premium to fund their increasing wealth.

When regular people start accumulating wealth from labour, they will hit the red button again, cause collapse, and seize it all yet again.

And I still have to put this disclaimer on every post I make to this effect: They are doing this without aggression and should be lauded for it; they absolutely should not be punished. But Jeff, the big libertarian, will still attack me because libertarians can't stand when truth is told, even if no one advocates punishing those not guilty of aggression.
  

This moral relativism of yours is exactly what lets government take this freedom, then that freedom, until we have lost them all.
-SnarkySack
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SkyChief
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Re: The Return to the Gold Standard
Reply #113 - Nov 5th, 2018 at 11:23am
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BobK71 wrote on Nov 5th, 2018 at 9:29am:
If you were born in 1870, you could live 100 years and silver would have been down over your lifetime in dollar terms, never mind purchasing power. 

Are you you referring to the gold-to-silver ratio?   The gold-to-silver in 1870 was 16:1.   

Today the gold-to-silver ratio is 84:1, meaning that silver is greatly undervalued.  It's fairly obvious that this is not a market-driven disparity - there are other machinations at play.

Precious metals are a terrible investment because they can't earn interest or pay dividends.

But they are excellent as money because of their unquestionable intrinsic value, and immunity from inflation.

2050 years ago, a fine [Caesar's Army] officer's uniform cost an ounce of gold.

Today, a fine Armani suit is .......   an ounce of gold  ($1395)

Gold has maintained its 'purchasing power' over 2 millennia.
  
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Jeff
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Re: The Return to the Gold Standard
Reply #114 - Nov 5th, 2018 at 2:12pm
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BobK71 wrote on Nov 5th, 2018 at 9:10am:
But if the gold/silver standard in every country in history has collapsed from too much printing, you have to start wondering if the intent of the gold standard was as advertised.

The intent of the U.S. Constitution was to prevent the government from issuing scrip and making it legal tender. Do you doubt that?
  
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Jeff
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Re: The Return to the Gold Standard
Reply #115 - Nov 5th, 2018 at 2:19pm
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BobK71 wrote on Nov 5th, 2018 at 9:10am:
When the elites repeatedly designed a system that failed always and in the same way, you have to start questioning if their intent was as stated in the first place.

Governments throughout history have debased their money. Modern governments have always liked having their own Central Banks and the ability to issue scrip.

The founders of America hoped to prevent that, and had what I think was the first chance ever to do it, because our government was to be bound down by laws created and approved by the people, which was a new and radical idea that no other government liked, but of course our own government very shortly tried to find ways around what was prohibited to them.

Our Supreme Court, which was supposed to be the final bulwark against usurpation of our liberty and violations of the law by government decided that in the case of issuing scrip, "necessity" trumped the law.
  
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Jeff
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Re: The Return to the Gold Standard
Reply #116 - Nov 5th, 2018 at 2:31pm
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SkyChief wrote on Nov 5th, 2018 at 11:23am:
Are you you referring to the gold-to-silver ratio?   The gold-to-silver in 1870 was 16:1.   

Today the gold-to-silver ratio is 84:1, meaning that silver is greatly undervalued.  It's fairly obvious that this is not a market-driven disparity - there are other machinations at play.

Precious metals are a terrible investment because they can't earn interest or pay dividends.

But they are excellent as money because of their unquestionable intrinsic value, and immunity from inflation.

2050 years ago, a fine [Caesar's Army] officer's uniform cost an ounce of gold.

Today, a fine Armani suit is .......   an ounce of gold  ($1395)

Gold has maintained its 'purchasing power' over 2 millennia.
Probably there is a lot more silver that has been mined since the ratio was set by the government at 16:1... But you're right that there are lots of factors involved in the relative values of gold and silver.

FRNS aren't a "good investment" if you buy them and hold them, they are guaranteed to go down in value. Gold will hold it's value pretty well over time, but neither is it a "good investment" if you don't invest it in something.

Both gold and silver have commercial uses, which can make either an investment. If you see some new technology or process that uses a lot of silver and you think will be very popular, you might want to buy silver...

The metals used in catalytic converters would have been a good investment right around the time our government was mandating catalytic converters be installed on all new cars. Metals used in modern batteries would have been a good investment right as our government began mandating and subsidizing solar power and electric cars.

Cronies probably made a killing by getting in the market for those metals before anyone else knew about the mandates and subsidies. Cry
  
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SkyChief
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Re: The Return to the Gold Standard
Reply #117 - Nov 5th, 2018 at 4:49pm
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Jeff wrote on Nov 5th, 2018 at 2:31pm:
Both gold and silver have commercial uses, which can make either an investment. If you see some new technology or process that uses a lot of silver and you think will be very popular, you might want to buy silver...

Stocks and bonds are good investments because they have the potential to yield interest and dividends.  Gold or silver have never yielded interest or dividends.   Cry   That's why most short-trade investors look down their noses at precious metals.

The price of Precious metals may go up, or may go down, but that is only consequential to the strength of the dollar.   The value (purchasing power) of PMs has proven to be very stable for thousands of years - they cannot be printed.

The value (of PMs) will remain stable because there is a finite amount of these metals on the Earth. And, over time, mining them becomes more difficult -  more expensive and requires more resources.

It is impossible to manufacture gold or silver.  It would require extreme temperatures and pressures which cannot be produced on Earth.
  
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Jeff
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Re: The Return to the Gold Standard
Reply #118 - Nov 5th, 2018 at 5:11pm
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SkyChief wrote on Nov 5th, 2018 at 4:49pm:
Stocks and bonds are good investments because they have the potential to yield interest and dividends.  Gold or silver have never yielded interest or dividends.
Neither has coal, but there was a time when lots of money could be made by investing in coal.

I bought some gold at around $300/ounce, and sold some of it when it was nearly $1700/oz.

That was gold I bought as a commodity, hoping to get a good return, and I did, pretty good anyway.

I have some other gold I didn't sell, I'm hanging on to it as a store of value.
  
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Jeff
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Re: The Return to the Gold Standard
Reply #119 - Nov 5th, 2018 at 5:15pm
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SkyChief wrote on Nov 5th, 2018 at 4:49pm:
The value (of PMs) will remain stable because there is a finite amount of these metals on the Earth. And, over time, mining them becomes more difficult -  more expensive and requires more resources.

I've heard there are lots of PMs in the asteroid belt...

If somebody develops a rejuvenation machine that can restore people's youth, and the process requires a lot of silver, expect the price of silver to go way up...

The Malthusian view keeps saying we ran out of everything at least 100 years ago!
  
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