Re: Apple stock hits all-time high!

In article <OemdndkjCvphD5TanZ2dnUVZ_hynnZ2d@xxxxxxxxxxx>,
Maverick <Sun@xxxxxxxxx> wrote:

ZnU wrote:

In article <DiKNi.57906$YL5.35482@xxxxxxxxxxxxxxxxxxxxxxxxxx>,
JCrowe <Giuseppe.Corvo@xxxxxxxxxxxxxx> wrote:


Oxford wrote:

Maverick <Sun@xxxxxxxxx> wrote:


not sure what you mean Maverick, it's perfectly legal to own gold, and
if we as a society agreed it wasn't in the public's interest to own it
again, the government pays for it, it's not like you lose your gold.

don't be silly.

It is legal now to own gold... it is just that there is a 1977 law that
allows the U.S. gov to confiscate that gold during hard times like war
or some emergency.

sure, but they have to give you equal value in return, thus the
existence of silver certificates.

Silver certificates were invalidated in 1968....I remember it
well. The U.S. dollar has no real value other than promises by
the federales that it is legal tender.


Unlike gold and silver, which have substantial intrinsic value because
you can eat them, live in them, and use them to fuel your car.

Oh, wait. You can't. While they have some minor industrial applications,
gold and silver derive most of their value from the fact that people
have an irrational attraction to shiny objects.

Seriously, the only potential benefit to a currency based on a precious
commodity is that this system prevents the government from dumping
massive new amounts of currency into circulation without first taking
the step of detaching the currency from the commodity or redefining its
value relative to the commodity. This is of no actual value, of course,
because a government can do that whenever it feels like it.

On the flip side, currencies valued in terms of precious commodities
have several serious problems even when working as intended (i.e. when
the government doesn't do what's mentioned above).

The big one is that the amount of currency in circulation is, in an
ideal world, precisely proportional to the amount of wealth in an
economy. If the size of the economy doubles, the amount of currency in
circulation should double, so there's enough currency to represent all
that new value without deflation occurring.

There's no reason to think that pegging your currency supply to the
value of some random commodity in a government vault somewhere has any
chance of doing that with any degree of accuracy. The supply of gold or
silver does not necessarily have any relationship to the size of the
economy.

In contrast, the system used in almost all modern economies today, which
basically puts new currency into circulation via bank loans, works
pretty well, because the value of loans taken out tends to correlate
fairly well with the level of economic expansion.

[snip]

The problem with this is that the current U.S. dollar isn't defined to
be anything. The 1872 Money Act defines one dollar to be 23.22 grains
of gold.

Which has no inherent value either, as noted above. The paper dollar is
actually backed up by something much more substantial than gold... see
bellow.

Today what is the dollar of what? Debt.

Well, yes. Exactly. The gold trolls try to convince people that this is
some big conspiracy to keep people in debt, and ominously imply that it
somehow means that the more dollars you have, the further in debt you
really are! It doesn't mean anything of the kind, of course. What it
does mean isn't that hard to understand, either.

Let's imagine an economy in which there are only three actors, A, B, and
C. A gives some valuable item to B. How is A compensated for this? One
way might be for B to give A some other valuable item in return. This
is, of course, barter.

But maybe B doesn't have anything that A wants at the moment. Maybe A
instead wants something from B later, or wants something from C instead.
How can B compensate A in a way that allows for these possibilities?
Well, instead of giving A some valuable item, B can give A some token
that represents a certain amount of debt. A can hold onto this token for
as long as A wants to before calling in that debt, or A can give it to C
in exchange for something valuable that C has. C will accept it because
C knows B will provide something of value in exchange for it.

This is basically how debt-based money functions. In a system with
millions of economic actors all agreeing to use the same debt tokens,
the most valid way to describe what those tokens represent is that they
represent a debt owed by the economy to the entity that holds the token.
In other words, if you have a dollar, the dollar-based economy owes you
a dollar worth of goods or services.

This is what I meant when I said the paper dollar is backed up by
something much more substantial than gold. It's backed up by the entire
dollar-based economy. Rather than there being one guarantor for the
value of the dollar -- the government -- there are as many guarantors as
there are people willing to accept dollars.

[snip]

If anybody thinks that just because they have paid off their house, car
and are completely out of debt, think again... you pay income taxes, car
taxes, taxes on just about everything, property taxes.

The fact that people have to pay taxes has nothing to do with the fact
that money is debt-based.

One will always be in debt as long as the federal reserve system is
in place.

Nope. Any specific individual who has more dollars than they owe is not
in debt. Rather, the dollar-based economy is in debt to them.

--
"More than two decades later, it is hard to imagine the Revolutionary War coming
out any other way."
--George W. Bush in Martinsburg, W. Va., July 4, 2007
.