Quick Ron Paul questions.

[NoStateofMind]

Originally posted by: CitizenKain

Originally posted by: PC Surgeon


The fiat monetary system is far from impeccable, in fact, when it does hit hyperinflation people are left with nothing but kindling. Why is it that after an economic collapse (hyperinflation), governments resort back to hard (gold & silver) currency to stabilize their markets and monetary systems? Why not start with a new fiat currency? Because people would know it wasn't worth anything. They have to get people to see value in it first by using gold, then slowly remove it because of spending.

With the mountain of evidence showing how unstable fiat is or can be, how can anyone be for it? If hyperinflation happened those who stuck with the U.S. dollar would be out of everything. Those who had bought or retained gold/silver would be able to remove themselves from the mass poverty. Thats if you could get it passed through the government confiscating it all. Which is why you buy gold ina foreign market.

Cheers

So, a lot of countries going through periods of political, economic, social and various instabilities have money problems and this is surprising? Strangely enough, all the countries on there had something like that happen. Although Yap is hilarious, because they essentially were using a gold standard with other shiny rocks.

Its strange that so many countries that are hugely successful don't instantly switch back to the gold standard after decades of prosperity of using fiat currency. If they only knew how wrong they were, and the solution is to instantly plunge their country into economic chaos to prevent their country from falling into chaos. The "We had to burn the village to save it" theory of economics.

Please explain to me why these economies go back to a gold/silver standard after fiat fails. The answer is in the first paragraph you quoted of me. It is cyclical, just not in the sense LK stated. Nearly all economies start with a gold/silver currency then require less and less precious metals to meet their spending habits, ultimately they end up printing too much. Hyperinflation sets in and the economy collapses. Then it starts all over.

 

[LegendKiller]

Originally posted by: PC Surgeon


Please explain to me why these economies go back to a gold/silver standard after fiat fails. The answer is in the first paragraph you quoted of me. It is cyclical, just not in the sense LK stated. Nearly all economies start with a gold/silver currency then require less and less precious metals to meet their spending habits, ultimately they end up printing too much. Hyperinflation sets in and the economy collapses. Then it starts all over.

So, the problem isn't the fiat currency, it's how it's used?

How is it used wrong, how do you prevent it, and how does that apply to this country?

What makes this country different from every other country on that list?

 

[NoStateofMind]

Originally posted by: LegendKiller

Originally posted by: PC Surgeon


Please explain to me why these economies go back to a gold/silver standard after fiat fails. The answer is in the first paragraph you quoted of me. It is cyclical, just not in the sense LK stated. Nearly all economies start with a gold/silver currency then require less and less precious metals to meet their spending habits, ultimately they end up printing too much. Hyperinflation sets in and the economy collapses. Then it starts all over.

So, the problem isn't the fiat currency, it's how it's used?

I'm not sure fiat currency could ever be stable forever. Leaving too much to chance with power hungry politicians.

How is it used wrong, how do you prevent it, and how does that apply to this country?

We should revisit history for the answer.

What makes this country different from every other country on that list?

We aren't on the list yet? As stated in previous posts we have a few similarities with nations who's economies collapsed using fiat currency. Find out what they are, acknowledge them as problems, circumvent it. Either we go to a hard asset backed monetary system by choice in the near future or we get forced into it later on.

 

[LegendKiller]

Originally posted by: PC Surgeon

Originally posted by: LegendKiller

Originally posted by: PC Surgeon


Please explain to me why these economies go back to a gold/silver standard after fiat fails. The answer is in the first paragraph you quoted of me. It is cyclical, just not in the sense LK stated. Nearly all economies start with a gold/silver currency then require less and less precious metals to meet their spending habits, ultimately they end up printing too much. Hyperinflation sets in and the economy collapses. Then it starts all over.

So, the problem isn't the fiat currency, it's how it's used?

I'm not sure fiat currency could ever be stable forever. Leaving too much to chance with power hungry politicians.

How is it used wrong, how do you prevent it, and how does that apply to this country?

We should revisit history for the answer.

What makes this country different from every other country on that list?

We aren't on the list yet? As stated in previous posts we have a few similarities with nations who's economies collapsed using fiat currency. Find out what they are, acknowledge them as problems, circumvent it. Either we go to a hard asset backed monetary system by choice in the near future or we get forced into it later on.

Nothing is stable forever, that's why gold isn't used.

What are your opinions on that history?

No, we aren't on that list. Inflation isn't rampant, economic growth is still good, outside of cyclical events.

What about all of the countries that had similar problems but didn't go back to a gold backed currency? What about all of the countries that haven't developed problems? What about the problems we still had under hard currencies that we don't have now.

You still haven't definitively proven that times were so great under a hard currency and we have proven time and again that they weren't great.

How about you list countries that had problems while on a gold standard, with rampant inflation, recession/depressions and overall economic instability.

Additionally, how about we study the presence of inflation despite having a gold based currency.

You are still missing the point that selectively choosing scenarios that fit your study is a horrible way of performing a study.

Halik has already posted links to several studies to refute that the correlation between fiat and economic ruin is dubious and the evidence points that fiat currencies help, rather than hurt.

 

[BeauJangles]

Originally posted by: PC Surgeon

Originally posted by: BlinderBomber


my advice would be to look at how instable the world's economies have been prior to the 20th century. Take a look at how Spain, France, England, Italy, et al spent themselves to death despite using something resembling a "gold standard." Take a look at the severe depressions that hit the United States in the 19th century.

Things weren't so rosy. In fact, I'd say things have been going much, much better in the past seventy years.

Refer to my response to LK.

Most of those examples you listed went through periods of terrible economic crises. First, I don't think that changing to a gold standard would have mitigated all of symptoms of their crises and, second, you need to look back at history and see how many times a non-fiat currency has failed to do anything but trigger economic collapse. I think it will put some of this stuff in perspective - neither answer is perfect, but one is certainly working better than the other and one has the ability to recover quickly from the aforementioned crises that may occasionally arise.

 

[Mavtek3100]

Don't have time for much else right now, but I thought this was funny....


17. The evidence is alarming for a lot of things. However, evidence isn't proof.

If Evidence isn't proof, what the hell is it?

According to Webster......

Main Entry: 1ev·i·dence
Pronunciation: \'e-v?-d?n(t)s, -v?-?den(t)s\
Function: noun
Date: 14th century
1 a: an outward sign : indication b: something that furnishes proof : testimony; specifically : something legally submitted to a tribunal to ascertain the truth of a matter
2: one who bears witness; especially : one who voluntarily confesses a crime and testifies for the prosecution against his accomplices
? in evidence
1: to be seen : conspicuous <trim lawns?are everywhere in evidence? American Guide Series: North Carolina>
2: as evidence

 

[LegendKiller]

Originally posted by: Mavtek3100
Don't have time for much else right now, but I thought this was funny....


17. The evidence is alarming for a lot of things. However, evidence isn't proof.

If Evidence isn't proof, what the hell is it?

According to Webster......

Main Entry: 1ev·i·dence
Pronunciation: \'e-v?-d?n(t)s, -v?-?den(t)s\
Function: noun
Date: 14th century
1 a: an outward sign : indication b: something that furnishes proof : testimony; specifically : something legally submitted to a tribunal to ascertain the truth of a matter
2: one who bears witness; especially : one who voluntarily confesses a crime and testifies for the prosecution against his accomplices
? in evidence
1: to be seen : conspicuous <trim lawns?are everywhere in evidence? American Guide Series: North Carolina>
2: as evidence

proof /pruf/ Pronunciation Key - Show Spelled Pronunciation[proof] Pronunciation Key - Show IPA Pronunciation
?noun
1. evidence sufficient to establish a thing as true, or to produce belief in its truth.
2. anything serving as such evidence: What proof do you have?
3. the act of testing or making trial of anything; test; trial: to put a thing to the proof.
4. the establishment of the truth of anything; demonstration.
5. Law. (in judicial proceedings) evidence having probative weight.
6. the effect of evidence in convincing the mind.



YOu have evidence, not proof. Evidence can only be used to prove something if it turns out to be factual, true, relevant, and repeatable if in the case of a experiment/study.

 

[BeauJangles]

Originally posted by: SleepWalkerX

As far as our exports are concerned. What I mean is our exports are, in a way, replaceable. If we stop exporting TVs or cars then Japan will take that up. Agriculture? Others can farm too. I'm not saying that our exports are not important. And there will be a very disastrous outcome globally if we went into a depression, but we would suffer the most. This is all speculative and imo obviously.

If China stopped making cheap TVs, Malaysia would pick up the slack.
If Japan stopped making cars, China would produce more.

All products are replaceable, particularly manufactured goods. A lot of the services the US provides would be difficult to replace though, like anything, other countries would take on an increased load if the US suddenly fell apart.

We are not at any greater or lesser risk than any other country.

 

[yllus]

Originally posted by: halik

Most Large multinationals have in-house forex hedging department (to protect themselves from fluctuations)... I'm sure they'll be ecstatic about the prospect of hedging again goats, stones, gold, donuts and whatever else 'currency' they get for their products :roll:

This is by far the stupidest thing to come out of Ron Paul's mouth yet; I'm astounded you imbeciles actually subscribe to it.

Not too long ago, we here in Canada has our first tax rate change in over a decade. My company as well as many others put in long hours to adapt our systems to remove the hardcoded tax rate percentage and build in a variable that could be modified centrally. This was... Complex.

Competing currencies and the checks against present-day valuations would set me back at least a couple of months in figuring out a software solution. Most likely we'd have to build in some link to an outside financial service whose job it would be to provide clients with updated numbers. So in terms of the cost of daily business, we'd have to account for the fee paid to this service, and for all of the lost time from diverting our developers to account for this new system.

Did I mention that this would inevitably push up the prices for the products we offer our customers as we take the the new COB figures into account? Great, so on top of everything else we become less competitive with businesses overseas.

Yeah, it's "KISS" all right. To the people with an Wikipedia-based fiscal education and no idea about the intricacies of business.