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Why are we cutting trees to print fake money

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Thread replies: 105
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All central banking system are unstable because by design it creates more debt than it creates money with which to pay that debt.
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>>975459

The difference between those two notes is that one is 'legal tender for all debts public and private' as it clearly says on the note, and that said commitment is upheld by the United States government.
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actually one is backed by gold and metal in the federal reserve, which is the global currency used to determine how much wealth a country has
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Your legal tender is not backed by gold or silver. Its just paper.

Its Fiat money
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Fractional reserve banks…create money out of thin air.
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>>975459
Yahhhh broooo we should just buy the trees with all the money we save then give them to everyone to look at. We will all be rich.
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Fractional reserve banks…create money out of thin air.
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>>975473
Backed by gold lol
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“Paper money eventually returns to its intrinsic value – zero.” (Voltaire, 1694-1778)
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Name a currency that is publicly traded that is backed by a commodity.

The US Dollar is actually weighted to the USDX and it is how we determine what the strength of the dollar is compared to the rest of the world.
https://en.wikipedia.org/wiki/U.S._Dollar_Index

These world currencies are also backed by nothing except the relative strength of what the dollar represents buying-wise in their own country. Governments control the inflation rate of their currencies by restricting federal funds, printing levels and how much of foreign currencies they trade.

So are we playing with paper money? The money represents the end of system of trades comparing one government's ability to restrict inflation and encourage spending.

That to me is just as powerful as the value of bitcoin, which is just investing in the strength of encryption.

Arguments to tie to a commodity are foolish because then we are hoping that people will want that currency in 5-50 years which is a larger risk than if countries will still have governments in 5-50 years.
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>>975459
Which is by design since the system assumes infinite growth

Grow up little kid
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The US Dollar Index (USDX, DXY) is an index (or measure) of the value of the United States dollar relative to a basket of foreign currencies,[2] often referred to as a basket of US trade partners' currencies.[3]


When all currency are papers backed by nothing. How and why do we compare relative value ?


It is a weighted geometric mean of the dollar's value relative to other select currencies:

We sell our services and become enslaved to paper and digits exchange between like minded governments and corporates for paper.


USDX goes up when the US dollar gains "strength" (value) when compared to other currencies.

Source : https://en.wikipedia.org/wiki/U.S._Dollar_Index
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The system assumes infinite growth, but they also have a ceiling "debt ceiling".

Ant they raised it again for you :)

http://www.wsj.com/articles/after-debt-ceiling-deal-a-sense-of-futility-grows-in-congress-1446223337
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>>975480
>Gold has intrinsic value
>Fiat money isn't infinitely durable even though it's just a concept
>Land is not divisible
>Oil is not portable but gold is
>Oil is divisible but land is not
This chart is shit
>>
Still digging
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>>975480
>gold
>intrinsic value

it may have certain limited industrial applications, but the two biggest things gold has ever had going for it is "looks really shiny" and "isn't easy to find"

gold is pretty much exactly the same as paper money in that it has value because people think it does
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>>975467
>The difference between those two notes is that one is 'legal tender for all debts public and private' as it clearly says on the note, and that said commitment is upheld by the United States government.
That means precisely fuck all and is a fairly large step down from "this note is redeemable for <amount> of gold from whoever".
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>>975601
>gold is pretty much exactly the same as paper money in that it has value because people think it does
How about the fact that you can't just print more of it?
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Prior to 1971, the US dollar was backed by gold (real money). This was known as the 'gold standard'. Meaning you could exchange a $20 bill for $20 worth of gold. This also meant that the currency supply was tied to the gold supply. Because there was a limited amount of gold, there was a limited amount of currency in the system. This made currency valuable, because it was backed by real tangible value.


In 1971, Richard Nixon severed the US dollar from the 'gold standard' meaning that you could not longer exchange your bills for gold and silver.

Source: https://www.quora.com/Why-is-the-value-of-the-American-dollar-decreasing
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>>975626
>tying your currency to a publicly traded commodity
What could possibly go wrong?
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>>975626

Gold is a meme metal. The value it derives from use is far less dominant than the value it derives from being a meme.
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>>975626
wtf? You can buy $20 worth of gold today... kek
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>>975618
>means precisely fuck all
It means everything.
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>>975618
The government will accept one of those bills as payment for government services rendered and as a payment of taxes and will throw you in jail if you don't pay them with their special paper that only they are allowed to make under pain of going to jail.

One is paper in a shitty board game.

I'd say that's a pretty big difference.
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>>975671
>>975687
B-but r-ron paul said
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The term paper gold means you have a piece of paper acting as a substitute for physical gold.

With paper gold, you don't own gold; in most cases you don't even own a promise to receive physical gold.

can every one convert worthless paper into gold ?
the answer is NO .

The use of gold as money began thousands of years ago and in October 1976, the US government officially changed the definition of the dollar; references to gold were removed from statutes. From this point, the international monetary system was made of pure fiat money.

Source: https://en.wikipedia.org/wiki/Gold_standard
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one is made from paper, one is made from cotton
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>>975687
>>975671
What I mean by 'that means precisely fuck all' is that all it means is 'you have to treat this worthless paper I can make more of whenever I want and in whatever quantity I desire as if it has value because I say so'
That doesn't actually make it valuable.
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>>975729
Yes it does
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>>975821
Useful perhaps, but not valuable.
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there is absolutely no difference in "fiat" or a tangled currency. it's all about confidence. there is absolutely no benefits that money would be tangled to gold, squirrel etc. lol

money is always leveraged debt, it dont matter if it's tangled or not. just look at the history of mankind.
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>>975846
The value is in the usefulness, anon. No, you can't survive off eating dollar bills. But good luck eating without them.
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>>975459
Central banks don't create debt.

Creating debt doesn't create more debt than money because money recirculates allowing an individual to earn again the money he used to pay off old debt to pay off new debt.
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They've stopped pretending.
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>>975473
Backed by Oil actually
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ITT: people who haven't studied a single book of economics trying to talk
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>>975473
The federal reserve's gold supply disappeared years ago and they don't know where it is. This is public knowledge, look it up.
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>>975901
>Pay us money so we'll allow you to work to pay us money.
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>>975639
Underrated comment.
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>>976137
this.
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>>975846
And "oooh. what a shiny rock!" is somehow more of an intensive value?

And don't give me the "gold is used in processors!" bullshit, because you know full well that the vast majority of gold's value comes from it being perceived as a luxury good. The same reason why diamonds are more expensive than sapphires despite top-quality of the latter being rarer than top-quality of the former.
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>>975510
>bold claims
>no reasoning
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>>975510
>Philosopher
>In the 18th century
What examples did he have to rely on? Every paper currency used during that time was to sponsor wars. None of it was legal tender.
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You guys do realize that it's 100% OK for currency to have no intrinsic value? It's just a way to ease barter of goods, you fucks. It represents labor and time, it does not need to have any intrinsic value. Why would it need intrinsic value?
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>>975510
>intrinsic value
Nothing in this world has any intrinsic value, you cockgobbling retard.
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>>975459
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>>975639
Although goldfags are idiots, the point is that if you keep a currency fixed, you can always get the same amount of gold for 20%. Nowadays how much you get is completely dependent on the value of the dollar and the market value of gold.

Of course goldfags completely refuse to accept all of the times where fixed-rate currencies have completely failed because they're subject to foreign speculation. The entire Asian debt crisis of the 90s can be attributed to countries refusing to float their currency and being forced to adjust the value of their currencies in one giant jump rather than smooth increments like floated currencies do naturally.
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>>975621
>How about the fact that you can't just print more of it?
Humans impose value upon objects of their choosing. When you realize this, you'll hopefully drop the childlike "b-but it's a FINITE resource!"-argument.
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>>975699
>ron paul
>a retarded goldbug
No. Just no.
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>>976578
Ron Paul is the main reason most millenials have no clue about economics. He's been pushing the gold standard on dumb college kids for decades
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To all the goldfags in here: gold is just as "inherently worthless" as money. Shiny yellow rocks vs green painted fabric makes no difference.

It's worth what people believe it's worth. And in case of apocalypse etc you can't eat gold so it'll be useless as well
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>>975467
>The difference between those two notes is that one is 'legal tender for all debts public and private'
In other words, the difference is a publicly held agreement to believe it's different.
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>>975459

I'll just say that a bill is actually majority cotton.

But continue going on about how we cut down ONE tree to make ONE bill.
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>>975563
>Soap is a consumeristic product no one really needs
Stopped reading right there champ.
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>>975601
I'm in your camp, but gold, being a non rustable element has a purity, durability, and fungibility most natural items don't have. Therefore it's not just because it's shiny and rare. The rarity does help though.
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>>976740
>In other words, the difference is a publicly held agreement to enforce its difference.
FTFY.

Fiat money is valuable because it is the legally defined medium of exchange. The government has decided that money shall be an acceptable method of paying all debts and enforces that. This is why you can't legally ask people to pay debts in gold or foreign currencies or in barrels of oil. You might accept something other than the legal tender as payment but you generally can't require it.
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>>976666
REEEEEEEEEEEEEEEEEEE
No, shiny yellow rocks are more valuable because you can't just print more shiny yellow rocks into existence. That's why every fucking culture around the world used gold as the unit of exchange for thousands of years.
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>>975459
the only difference between the paper and gold is your belief that one has more value than the other :^)
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>>976548
>And "oooh. what a shiny rock!" is somehow more of an intensive value?
Value cannot exist without scarcity, and since fiat currency can be willed into existence in any quantity, it is inherently without value, as there is an unlimited supply of it.
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>>977329
Trees are a finite resource ;^)
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>>977344
No as it can regenerate. And fuck you.
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>>976548
gold is stable and durable, it lasts forever. That's why it's valuable. If you have 1 ounce of gold now you'll still have an ounce in 100 years. It wont erode or rust
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>>975459

Currency these days is backed by force, and that is better than gold.
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>>977325
>>977353
The only reason gold has the value it has now is because many banks have historically used it as a commodity that is not influenced by market movement as much as other commodities.

However, if you look over the last 15 years or less, gold has left its 0 correlation and is straying to a -.3 range.

Gold has always been used as a speculator hedge to hold money constant as markets go through heavy chop. But because gold mining has become so tied to oil prices, gold itself (and other metals) have seen issues when oil drops and oil explorers/drillers get profitable.

We will see a new futures contract fill the void metals had before. My guess is volatility outright will become a new asset class that is bought in smaller percentages against longs in the market.

So really, we should establish a volatility dollar. A currency that increases in value as the value of the dollar decreases. A minted hedge you can have in your wallet to keep its value constant.
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>>977329
The government sets how scarce it is, you retard.

>>977353
>That's why it's valuable.
There are plenty of things which don't erode or rust and are less valuable than pure gold, m80.
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>>977365
>The only reason gold has the value it has now
>now
Gold has always been valuable you twit.

>>977379
>The government sets how scarce it is, you retard.
In principle though, the supply is unlimited.

>There are plenty of things which don't erode or rust and are less valuable than pure gold, m80.
How many of those are easily and reliably identifiable, rare, and easily turned into beautiful jewelry?

>Gold is the most malleable and ductile of all the metals. One ounce of gold can be drawn into more than 80 Km of thin gold wire. One ounce of gold can be beaten into a sheet covering 9 square meters and 0.000018 cm thick.
>Gold has the highest corrosion resistance of all the metals and it is corroded only by a mixture of nitric and hydrochloric acid. Gold is a noble metal because it does not oxidize.
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>>977383
>Gold has always been valuable you twit.
So has the dollar

>In principle though, the supply is unlimited.
See: diamonds

Your other points are just about how cool gold is. That's great, it's really cool. But the reason we stopped using it as currency is that its scarcity makes it easy to manipulate its price and also put deflationary pressure on the economy as a whole. Do you really want an economy that can only grow at the rate more gold is mined? Do you really want a dollar that can be brought down by commodities traders in London?
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>>975597
>AND CHARGE OURSELVES 0% INTEREST
do here idiots not realize nobody would buy 0% interest paper?
or are they suggestingf creating inflation to fund US expenses, which would also cost US currecy holders...
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>>977639
>Do you really want an economy that can only grow at the rate more gold is mined?
I don't see why that would be rate-limiting.
>But the reason we stopped using it as currency is that its scarcity makes it easy to manipulate its price and also put deflationary pressure on the economy as a whole.
And governments being able to print as much money as they like doesn't make fiat currency ripe for manipulation?
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>>977845
GDP growth is restricted by money supply or things get ridiculously expensive very quickly.

You also seem to be implying foreign governments can print US dollars and don't seem to understand what Treasuries are or how they back the dollar. Lurk a little more, newfriend
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>>977901
>You also seem to be implying foreign governments can print US dollars
That's not at all what I'm implying. Who the fuck would imply such a thing?
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>>977845
But Canada, the swiss bank and Japan can't print more US dollar. Our money is valued on an index level compared to everyone else's.

Look up earlier in the threat. Our money isn't just some floating number based purely on supply/demand. Our US treasury department and banks buy and sell currencies with our dollar and that total sum compares itself to the whole.

I.E.: we have people buying other nation's currencies right now with our dollar and then holding it. So we have 1.2 chf for every usd and if we could get a better deal, the banks and whoever else might trade that chf for jpy. In the end $1 bought it so the $1 goes up.

But, there are situations where it goes down too, that is how the market works. Our treasury deparment, national bank, and private banks trade daily with the goal of keeping the US dollar at a reasonable level.

And then don't get us started on how bonds are incorporated into this. (hint, they are).

But nothing about a "Fiat currency" means it is worthless. We found a better way to hedge against 'major' market manipulation by trading notes and currency on a global level.

Since gold is just one commodity and not a series of foreign notes and currencies, it could be even more manipulated. Banks do a bit of scalping and move currencies a couple of points with their networks, but it is nothing compared to tanking a nation that could be done with gold.
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>>977923
I think it remains to be seen how royally fiat currency can fuck a country. It took thousands years for people to figure out how to do it with gold ;).
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>>975473
actually the us dollar is backed by the us military, you dumb fucking idiot.

SHUT BIZ DOWN
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Central banks can create as much "money" as they want. Paying off debt isn't a problem per se. Debt-services (private or public) will always outstrip the actual objective value creation potential in society to pay it off in actual tangible goods and services is the problem.
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>>975459
"is YOUR belief that one has more value than the other"

Im pretty sure the difference is that one of them is backed by the most powerfull country in the world and the fact that EVERYONE believes its worth something
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>>976572

water?
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>>975927
>oil
>black gold
whats the difference?
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>>977639
>Do you really want an economy that can only grow at the rate more gold is mined?

>Other economists disagree, arguing that the US experienced dramatic growth up until 1971 when the US went off the gold standard. Furthermore, prices will simply fall to reflect the higher purchasing power of gold.
Also note that the entire industrial revolution took place on gold.
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>>978840
As you can see from this chart, GDP growth has remained basically constant excepting the great depression and a short period thereafter. Or in other words, switching from the gold standard made no improvement in the long-term trend.

Pic source: http://www.forbes.com/sites/beltway/2011/06/16/nobel-prize-winner-analyzes-the-obama-growth-gap/
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>>978844
Convenient how that chart stops right after the huge deflation the US had to experience after the Civil War because returning to the gold standard was hard as fuck.

Aside from the other advantages discussed ITT, you simply cannot fund wars on a gold standard.
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>>978881
>Convenient how that chart stops right after the huge deflation the US had to experience after the Civil War because returning to the gold standard was hard as fuck.
Was merely the longest run I could find. Do you have an extended one?

As for
>you simply cannot fund wars on a gold standard.
I would say maybe you just can't fund wars you don't have the money for on a gold standard.
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>>978884
Nobody has the money for actual wars. All of Europe had to abandon the gold standard as soon as WWI started. Small little conflicts like the US has fought for the past several years certainly do not count as wars, at least not to the US itself.
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>>979118
>wars were not fought before everyone abandoned gold
Somehow your position excites me to incredulity.
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>you can't create more gold
>meanwhile you can find the stuff in the fucking ground
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>>979137
>The best estimate at the end of 2011 is that around 165,000 metric tons (or tonnes) have been mined in all of human history.
Meanwhile
>Current estimates for world production [of cotton] are about 25 million tonnes annually
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>>979118

Actually, the public's obsession with avoiding any and all causalities has resulted in an extremely expensive military.

Iraq cost 1.7 Trillion. In adjusted terms, the entirety of WW2 cost 4.5 Trillion dollars for the USA in inflation adjusted terms.
>>
This board is terrible. I had such high hopes for it, too.
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>>979132
>wars were not fought before everyone abandoned gold
How do you manage to take that away from what I said? There's a reason Voltaire was able to talk about paper money in his day in >>975510. Because nations have invariably throughout the years resorted to non-fixed currency to fund the war. Inflation is in many ways a tax, so by creating inflation, you extract the funds from the people necessary to fund your war.

The point is that after all of these wars were fought, the countries always had to return to the gold standard, and to do that you had to undergo about a decade of stagnation and deflation. If you have a floating currency, its value moves with the market. You completely remove these issues of jumping from one extreme to another. Your currency moves incrementally.

And again, this is simply one small reason why floating currency is preferable.

>>978884
I didn't feel like searching too long, so i just found pic related and called it a day. Purchasing power is correlated with deflation.
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>>979160
That's still a difficult comparison because the US hasn't been in anything close to total war since the Civil War. You're better off looking at how countries that are actually in those wars directly fare. For instance, while the US could theoretically keep a fixed currency during the Iraq war, Iraq certainly could not.
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Goddamit /biz/ I come here today and theres a running thread in which half the posters are defending the gold standard. There goes the last of our credibility.
>>>/infowars/
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>>979164
The proliferation of goldfags is relatively new. I think they leaked over from /pol/, or started browsing /pol/ and got "redipilled".
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>>979181
>Goddamit /biz/ I come here today and theres a running thread in which half the posters are defending the gold standard. There goes the last of our credibility.

>Former U.S. Federal Reserve Chairman, Alan Greenspan acknowledged he was one of "a small minority" within the central bank that had some positive view on the gold standard. Greenspan once famously argued the case for returning to a 'pure' gold standard in his 1966 paper "Gold and Economic Freedom", in which he described supporters of fiat currencies as "welfare statists" intending to use monetary policy to finance deficit spending.
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>>979201
Alan Greenspan
ALAN GREENSPAN
>credible
are you serious right now?
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>>979205
>~20yr chair of the fed
>not credible
>less credible than... you..?
>>
>>979201
>>979205
Let's see what Jimmy Carter has to say about defeating ISIS while we're at it..
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>>979205
He's more creditable than you'll ever be
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>>979239
Dont quote the bubble chairman and expect to be taken seriously
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>>979256
>Dont quote the bubble chairman and expect to be taken seriously

>gold a shit it doesn't have enough inflation
>wahh these bubbles, why is there so much inflation?!
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>>979210
Greenspan was a monetarist who completely abandoned all of his ideals when he took office and oversaw the most liberal and interventionist Fed we've ever had.

There's a reason why it's called the "Greenspan Put"
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>>979276
Pardone my ignorance but isn't the point of being off the gold standard that one can do precisely this?
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>>979282
No. You cannot have monetary policy and capital flows if you have a fixed currency. The only way you can exercise monetary policy with a gold standard is by isolating the country from foreign capital. That would be completely devastating to our country considering the degree we rely on foreign capital.
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>>979266
What do bubbles have to do with inflation?
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>>979482
>What do bubbles have to do with inflation?
Good question. It seems like instead of increasing the price of standard goods [standard inflation], easy access to funds has increased the price of investment assets [asset price inflation] beyond what is realistic [a bubble].
>>
>>979513
Are you predicting we are in an equity bubble right now? I thought we were talking about Alan Greenspan. Wow you goldbugs are really all over the place
Thread posts: 105
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