Originally posted by: Dissipate
The concept of micro-statism seems to be escaping you. In micro-statism there wouldn't even be states as we know it. There would be counties and towns each providing for their own welfare, safety and defense. Each one would have their own monetary system, but at the same time there would be a common currency used throughout the micro-states. In my idea the common/international currency would be the digital gold backed currency while the local currency would simply be the tokens for which that currency could be redeemed. In any event, all of the "problems" you mention about interstate commerce and what not would dissappear under micro-statism. For under micro-statism the illusion of a country would disappear and every state would make its own decisions about commerce, war, diplomacy and trade. With regards to defense, the micro-states would simply form alliances.
Oh, my, you really do need to work on those reading skills. Everything you describe in your retort I addressed in my post.
Again, what you just wrote is already addressed in my post.Large monetary systems appear to be convenient, just as many people in the military find it convenient to have someone tell them what to do all the time. However, that convenience has a price, its price is freedom, control and power over oneself and community. When you give up the control over your medium of exchange you forfeit your individual power to a centralized power. This is far more dangerous that problems relating to natural disasters, for now the central power is charged with the task of maintaining an entire economy. This is far too much responsibility, for if this single power fails to perform this task the ENTIRE economy will plummet into depression. On the other hand if the economy of a single micro-state goes under, the other micro-states are unharmed and will be able to help out the badly affected micro-state.
Hoarding money is what gives the rich their economic power. A single entity with vast sums of money is in the position to manipulate the economy to a significant degree. I find it ironic that you say hoarding is not a problem when you complain about a single entity controlling the economy.As for hoarding, I don't see this as a problem. In fact it is not a problem, people should be allowed to hoard what they want and how ever much they want at any time. The idea that we need inflation to stop hoarding is absurd.
*Sigh*What you call unity, I call centralized power. Unity is a nice word, but it has much too positive of a connotation in this context. Unity can exist in many other ways outside monetary systems.
Explain how a local currency would be detrimental if the locals only accepted that local currency, I don't understand.
Remember what I posted about inflation?
Remember what I posted about hoarding?
Remember what I posted about money supply?
Remember what I posted about currency exchanges?
Remember what I posted about anything?
Might I suggest going back and actually reading some of my posts instead of ignoring them.
Ya know, you post about large inflation but after I address it you change the topic to long term inflation.Large inflation CAN be caused by excessive printing, but is not necessarily the primary reason. A contraction of the economy without an equivelent reduction in printing can lead to inflation. Negative currency trading can lead to inflation, especially with an economy like the US that is heavily dependent on foreign trade.Large inflation is caused by the printing of "money" on a large scale. Lack of faith in it may have something to do with it, but it is mostly printing that causes it to inflate, especially in the U.S.
The excessive spending of the Federal government contributes to inflation, as you say and I agreed in a previous post. However, it is not the only source and has only recently become a major factor due to the recession.
Short term inflation can be caused by market forces, but as I quoted a Fed economist earlier as saying, long term inflation only has one cause: increasing the money supply beyond the output of the economy.
Again, you are assuming the existence of a danger that does not exist.Unfortunately those citizens are unaware of the gravity of the situation. That is what I am trying to alert them to.
However, I do think a state should pay for some of the roads in another state considering the importance of interstate commerce on state economies. I would hope states with no military bases help pay for the bases in other states since they also benefit. It would be nice if land bound states help pay for the docks and ports on the coasts especially in light of the massive trade defecit. At the same time, I sincerely wish states would help cover costs for airport hubs in other states so I can actually travel across country without needing to drive.What if people in a particular state are tired of subsidizing the other states? Why should one state pay for another state's pet projects? It shouldn't. This is why micro-statism is needed, to insure that each community pays for its own pet projects, not exercise political power to get others to pay for them just because those people are part of the same country.
I don't suppose you realize exactly what zero subsidization will do to areas such as education, coastal regulation, national parks, port authorities, highways, etc. The reason the Federal government subsidizes those areas is for the same reason you pay your taxes to the city. You complain about a particular state subsidizing another state's pet projects but I have yet to think of a single "pet project" which does not benefit the other states.
Take the military, in which you seem to have an interest. Military bases are not spread evenly throughout the United States. I mentioned this before and it seems you forgot. A single, common army benefits each individual state, county, and city. Without a national army, every man of military age would be drafted into the army to serve for a certain number of years. Each city would have to provide for its own defense.
If you ally with other cities/counties/states, then you need a common base to increase effectiveness and decrease supply costs. Otherwise the only benefit is one less guy to attack. However, you still need to house that base somewhere which is where the subsidization comes in. A few cities/counties/states get together and form an alliance, but build their base in one city. All the other partners must subsidize the city with the base otherwise the city will be burdened with the costs from other alliance partners.
The same principle applies to Federal subsidies. It's pointless for two neighboring cities to build a power plant when a single plant that costs less per kilowatt-hour can provide enough power for both cities.
Speaking of power, remember Hoover Dam? I think at this point California is paying Nevada for water and power, but take a guess as to who started the project. Here's a hint: Dam was completed in 1935.
Oh, now you're changing your premise to fractional banking? Up until now you have been clamoring over the fraud and deception by the US government when it chucked the Gold Standard.Is it so flawed? Why have Austrian economists said time and time again that fractional reserve banking is fraud? An entire school of economics has raised this issue, not just me.
If you are now claiming that fractional reserve banking is fraud and the public has been deceived for hundreds of years, then you have agreed that fiat money is legitimate and we can now discuss this new issue.
Fraud means that a victim has been tricked into believing one thing while another thing is used instead.
Anybody with any semblence of intelligence knows how banks earn money (reason for fractional reserve).
If the public knows about fractional reserve banking, where's the fraud?
So tell me this : why are you still using the "fake" currency?People pick the currency currency because they have no idea that they are being scammed. Also, many people believe they must accept government currency at their business. This is what the nonsensical phrase: "THIS NOTE IS..." is all about.
People aren't using the currency solely because they're being scammed. First off, it's not a scam. Second, the reasons for using the currency has been explained over and over again. Reasons include convenience, stability, and value.
Businesses know they are not required to accept US dollars. Well, if they do, then they are thinking along the same path as you. Businesses that only accept US dollars do so because that is by far the most stable currency they have available or it is by far the most popular currency they encounter. The choice of currency (or even form of currency) is entirely dependent on the locale.
Only an idiot would open a shop in East LA that accepted only rubles. An even bigger idiot would open a shop in LA that accepted only Ithaca Hours (Hours are only accepted in a ~20 mi radius). You could even open a shop that accepted only gold and sold goods and/or services per mass of gold. However, I doubt you'll sell much.
People who travel to different countries often have to exchange their national currency for another. Now that we have international currencies, this is no longer a problem. Someone in micro-state A merely converts their local currency to the international currency, then converts it to micro-state B's local currency when they travel. As technology progresses the fees related to these transactions would be minimal.
I don't suppose you realize exactly how many currencies the average person would have to have in his wallet just commuting to work. Don't forget what happens on road trips or tours or even airflights (exchanges at every terminal for every single currency in the US).
It's also very funny you should bring up international currencies. The Euro was instituted for the very reasons I stated. Perhaps you should think about that a bit.
The Secret Service, the IRS, and the Federal Reserve Bank have all looked into Ithaca Hours and done NOTHING. You also listed at least four gold warehouses that have been around for a while. The American Liberty Dollar is the second most widely used currency in the US and it's backed by silver.Banks may be barred from doing this because they are under control of the Fed. Anyone can open a gold warehouse and start issuing Notes on that gold, but they will quickly learn that they will be pushed out of business quickly by the Fed's monopoly.
So where's the monopoly coming in to crush these poor currency systems?
Already addressed this.You are right, the government only accepts dollars for payment of taxes. The question is, what if dollars became worthless because everyone started using alternative currencies?
I'm sorry, but are you psychic? How do you know whether I "weighed anything" or not? It seems that if I disagree with you, I haven't "weighed anything" and I am simply a pacifist. Contrary to your accusation, I have weighed all options presented to me. I have even read every single link you posted in this entire thread. Thus, when compared to your favorite, free trimetalism, I say the status quo is the lesser of two evils. The only reason I prefer the current system is because I have never seen a better system in paper or in practice.You haven't weighed anything, you have merely said: "Well, this is they system we have and here is why it is the best." You have never lived in a time when the system was different. The current system is not the lesser of two evils, it is simply evil.
One of these options:In the two economics classes I took: Macro-economics and Micro-economics the classes basically said: "This is how it works, we are going to study this." instead of "This is how it SHOULD work." Once I started reading about how things should work, my interest in how they have artificially been made to work through government intervention quickly faded.
1. You weren't listening.
2. You weren't reading.
3. Your teachers stink.
TuxDave
Lifer
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http://]http://www.mises.org/StudyGuideDisplay.asp?SubjID=10<h[/L]]http://www.mises.org/StudyGuideDisplay.asp?SubjID=10<h[/L][/L]]http://]http://www.mises.org/StudyGuideDisplay.asp?SubjID=10<h">http://www.mises.org/StudyGuideDisplay.asp?SubjID=10[/quote]http://]http://www.mises.org/StudyGuideDisplay.asp?SubjID=10<h[/L]]http://www.mises.org/StudyGuideDisplay.asp?SubjID=10<h[/L][/L][/L]
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Ok, now that I got your immature response out of the way, let me go back to our exchange of arguments. Please help me understand your quote. I thought lower interest rates were to promote borrowing and spending. I understand that a $1000 computer now may be worth $900 later. I understand that an entrepreneur is investing his money to make a higher return later.
Now this is what I don't get. Ok, the premium a person places on future goods is subject to a supply/demand curve right? So he cannot arbitrarily place any premium, he is limited in the possible return on his present investment. Now if the gov't reduces interest rates, the cost of borrowing money is lower such that the entreprenuer can borrow more money, invest more in the present to make more in the future. That is how I see the gov't's interest rates influence the market, more than what the individual can do. Am I wrong?
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He is? Last time I checked he made wild assed assertions like the one about hoarding which I have shot down over and over. Furthermore, he is subscribing to an economic school of thought which has been academically discredited, since the end of the 20th century, namely Keynesianism/socialism.
We need a forums to throw threads like this one in. We can call it 'The fifth circle' or something.
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http://]http://www.mises.org/StudyGuideDisplay.asp?SubjID=10<h[/L]]http://www.mises.org/StudyGuideDisplay.asp?SubjID=10<h[/L][/L][/L]
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Ok, now that I got your immature response out of the way, let me go back to our exchange of arguments. Please help me understand your quote. I thought lower interest rates were to promote borrowing and spending. I understand that a $1000 computer now may be worth $900 later. I understand that an entrepreneur is investing his money to make a higher return later.
Now this is what I don't get. Ok, the premium a person places on future goods is subject to a supply/demand curve right? So he cannot arbitrarily place any premium, he is limited in the possible return on his present investment. Now if the gov't reduces interest rates, the cost of borrowing money is lower such that the entreprenuer can borrow more money, invest more in the present to make more in the future. That is how I see the gov't's interest rates influence the market, more than what the individual can do. Am I wrong?[/quote]
No, you are not wrong under the present system. However, what Austrian economists say is that interest rates should be set by lenders, not by governments. Notice I said lenders, not bankers, at least not fractional reserve bankers. So when you go to get a loan, that loan is based on good credit, credit being tangible assets such as gold, not bad credit which is "money" created out of thin air. Then the loaning institution can charge whatever interest it wants, and it is not influenced by government rates.
Even the Chicago school of economics (lead by Milton Friedman) agrees that government should not meddle with interest rates, although for a slightly different reason.
From the Austrian Quiz:
More on good credit and bad credit here:
[L=Text]http://www.mises.org/fullarticle.asp?control=1480&id=67[/L]
TuxDave
Lifer
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Heh... I like how all your quiz quotes have a final sentence that I find difficult to follow from the previous paragraphs. The quote states how they thing an action will work, then states what the gov't should not do. If it concluded that the wanted economic responses COULD be generated without governmental influence, that would make more sense. Anyways, therefore the gov't should regulate. (j/k.. just doing a parody of your quiz quotes)
Ok, so let's say banks can set individual interest rates. Hmm... so interest rates would be a competitive market. I believe the reason why they first started to regulate banks is because banks were shutting down left and right and so people didn't want to give/store money to banks in fear of it dissolving. That lead to more banks dying. Anyways, I would feel the same way if the risk of my bank dissolving, due to competitions with interest rates, increases. Without a central bank to back up my money, I too would probably look for another way to store my money.
I thought the minimum wage set by the gov't was to prevent companies from abuse of hiring workers for chump change. It was placed to protect the worker.
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They started to "regulate" banks because banks were committing fraud: fractional reserve banking. The reason why banks started shutting down is because in a free market fraudulent acts will cause your business to collapse. The Federal Reserve was created to stop this "free market mayhem" and bring stability to the banking industry. What did it do though? It merely created a cartel with insurance and bailouts in order to keep all the banks in business even when the free market keeps them in check.
Why would you need a central bank to "back up your money" if your bank/warehouse operated at FULL reserve? It wouldn't, for every depositor would be able to retrieve their deposits at any point in time.
The minimum wage was created in order to keep employers from paying workers "too little". However, it does nothing but increase unemployment in the cheap labor sector of the economy.
More on that here:
Text
Actually, no, what I assumed was a political landscape similar to the country as it was under the Articles of Confederation.
Already posted.
I use a country as an example when appropriate and international trade when appropriate. If there is any confusion as to which I am using, it is due to inconsistencies in your posts.
If you are not free to live as you please, you are welcome to move anywhere in the world that suits your lifestyle. There is nothing new in your comment.
What is so different in your system? The current legal system is also tiered in much the same way. Local matters are handled by local authorities, state level by state, national by Federal, and international by, well, international law.
You are still welcome to move to another city, state, or county in the US. You are also allowed to move to another country if you seem to think you were born in the wrong section of the world.
The above five points can be addressed by one example : Italian city-states.
The "truth" has not been overlooked by many, as evidenced by the number of people holding cash at home or in non-interest bearing accounts such as checking accounts. While it is true that money retains its value whether in someone's hands or or another person, the problem with hoarding is its effect on the money supply. Perhaps you would understand this a bit more if you understood history, specifically feudal systems.
How interesting in that this assumes two things:
1. The economic system is based on gold as the form of currency. Gold Standard, anyone?
2. It conveniently overlooks the nature of money as a medium of exchange.
The article addresses only the issue of whether hoarding reduces the buying power of the entire population. If you were reading carefully, you would have known I had already posted the same results. The problem with hoarding is the impact on economic power. A single extremely wealthy individual wields incredible economic power in much the same way as a large political bloc wields incredible political power in a purely democratic system. I explained this all before. In the long run, the primary effect will be determined by the actions of the major power; amount of capital investment, for example, and is actually insignificant to people during that time. In the short term, the effects can be devastating, and I have already addressed a certain number of problems.
Lol.. You should take a more careful look at who is making wild assertions and who is refuting them with great success. You should also try reading your sources before quoting them without understanding their contents.
Thank you for pointing out your ignorance.
You made a few assumptions:
1. The Fed will inevitably collapse. This can be successfully argued both ways.
2. People will stick to the Fed through thick and thin. This can be successfully disproved.
3. No single entity is infallible. This can also be argued both ways, depending on context.
4. You are representative of the few who can actually perceive the coming danger. Ha. Ha.
5. Nobody else can see anything wrong with the current system. Proven false numerous times.
In other words, your assertion is founded on weak or false premises.
Perhaps you are misinterpreting my stance. I simply stated that a group of parties with a common interest should combine their individual resources which have been dedicated to the accomplishment of that goal. The pooling of resources allows greater efficiency assuming a proper implementation. The idea is not derived from Keynsian economics.
If you think I am a Keynesian, then you haven't been paying attention.
If you think I'm a socialist, you are clearly delusional.
Military bases can be built in desolate areas, that is true. The problem you ignored is who has to put aside that land? If the alliance is formed with immediate neighbors, then you can arguably use land from all members. This becomes a problem with too many states. If you try to build on land outside of the alliance states, how are you going to get land? Short of a world-wide disaster, virtually every speck of land has been claimed or declared neutral.
Water and power can be sold on the free market I never said it wasn't possible. What I did say and you did not address is who will build the power plants and water facilities. I asserted that if a single facility with greater efficiency can satisfy the needs of several interested parties at a lower overall cost, then these parties should pool resources to build the facility. If each party instead builds its own facility to serve its own needs, the overall cost will be higher, the efficiency will be lower, and the facility may be shut down at periodic intervals to avoid overloading (flood and surges in the case of water and electricity).
Most people know that a bank takes the depositors money and uses it to give out loans. Therefore, most people know the bank works on fractional reserve even if they don't know what it is. It's like saying people know how cameras take pictures, but nobody knows about picture developing. Knowledge is not like a math equation.
On a side note, anybody who has done banking before knows how hard it can be to get their money back.
1. You depend on technology to overcome the inconvenience. As pointed out earlier (and I'm sure you're well aware) computer technology is far from secure and slower technologies open up a loophole.
2. Ignored the issue of stability and local disasters. Once the people dump a currency it is very difficult to get them to use it again. If left to the free market to decide, eventually a small number of currencies (or even a single currency) dominates and replaces local, less popular currencies. Why? If the more common currencies are just as good if not better, then it ties in to the issue of pooling resources. If on the other hand, the local currency is better, it will eventually grow and dwarf the once common currency and the previous possibility will apply.
3. The Euro is literally replacing national currencies.
4. I believe this has been posted: Existence of multiple currency systems promotes disunity. You may not like promoting unity, but I would much rather avoid unnecessary civil disorder.
Once again, I find the irony quite humorous. Previously, you ranted about the Fed's ability to create money digitally and here you are promoting the use of digital currency.
Oh, so you're looking for a volunteer organization to contribute its own resources and time to insure the security of your gold deposits. I'm sure the warehouse can be built for free and the security guards will donate their time for free and put their lives on the line for free.
Of course it is not a gold warehouse. Why else would they deposit silver only?
The reason I used it as an example is because the primary difference between gold and silver is the quantity. Silver is more common. The situation is otherwise identical to gold.
The inclusion of Ithaca Hours was used to exemplify the difficulty in finding monopolistic practices on the part of the Federal Reserve Bank. That was the context of the your post to which I used the example. Once again, you are ignoring evidence and throwing up smoke and mirrors.
Hence the repeated comments to actually read postings by individuals other than yourself.
Interesting considering the number of times I have used the information in my posts. You must be asserting that I am a genius since you seem to think I am coming up with the same information out of thin air.
Well, I can assure you that even my high school didn't follow that model. My college courses especially did not follow that model. Even history courses at both levels promoted individual analysis.
The instability of banks was the primary mover for government intervention. While the primary reason for instability was fraud, it had little to do with the actual principle of fractional reserve banking.
The fraud came from two sources:
1. Counterfeiting. Before government intervention, there were literally thousands of currencies in circulation. As such, it was rather easy to counterfeit money.
2. Low reserves. Banks had a tendency to loan out as much money as possible to maximize returns over time. This made it easy to create runs on the bank as loans were defaulted and/or spikes in withdrawals exceeded the amount of money still in the bank.
The government stepped in during the 19th century to regulate currencies to address the first issue. If I remember correctly, the power to print bills was given to the states and each bill had to conform to certain guidelines.
The Federal Reserve system was created to address the second issue. At the time, investment had gotten out of hand and investors were literally investing $100 worth of money using as little as $1 of their money.
A bank operating at full reserve can't give out loans. It would have to charge fees; monthly, per transaction, seigniorage, etc.
Fractional reserve banking is essentially combining your definition of a bank (or gold warehouse) and a lender.
Minimum wage has its problems, that's for sure. I believe it confers no long term benefits, as the increase in wage actually becomes inflation. In the short term, a wage increase can hit pretty hard.
For a guy who ranted about independent thought, you have a disturbing habit of posting links to mises.org.
Dear lord, are you really stupid enough to believe that our own government is going to collapse its own economy?
You call us blind sheep? Look in the mirror. You think you have it all figured out because you've read this one book. You're completely and utterly ignoring everything anybody says to you in this thread because you believe what you believe is the absolute truth, and it quite simply is not. I dare you to take up your ideas with a down to earth Econ professor. I am sure he could explain to you why your ideas will not work in the real world, if he doesen't just call you a quack and laugh.
This is not a utopia. Your ideas sound nice on paper, but then again.. so does communism.
If you're so intelligent, why are you sitting here spewing your nonsense to the people of ATOT? Who are you again? Come on, if your idea was the best, we would be doing it!
You need to get out in the world, you need to tell the people they've been lied to, man!
/dons tinfoil beanie
More doom and gloom bullsh!t from someone who read a book and considers themselves informed.
Go back to school. I haven't even had an economy class and I can tell you that you're full of sh!t. I can't do it as eloquently as Sahakiel, so you really have no reason to listen to me - the thing is, you're not listening to him either, and he's producing a far better argument than you are.
You call us blind sheep? Look in the mirror. You think you have it all figured out because you've read this one book. You're completely and utterly ignoring everything anybody says to you in this thread because you believe what you believe is the absolute truth, and it quite simply is not. I dare you to take up your ideas with a down to earth Econ professor. I am sure he could explain to you why your ideas will not work in the real world, if he doesen't just call you a quack and laugh.
This is not a utopia. Your ideas sound nice on paper, but then again.. so does communism.
If you're so intelligent, why are you sitting here spewing your nonsense to the people of ATOT? Who are you again? Come on, if your idea was the best, we would be doing it!
You need to get out in the world, you need to tell the people they've been lied to, man!
/dons tinfoil beanie
More doom and gloom bullsh!t from someone who read a book and considers themselves informed.
Go back to school. I haven't even had an economy class and I can tell you that you're full of sh!t. I can't do it as eloquently as Sahakiel, so you really have no reason to listen to me - the thing is, you're not listening to him either, and he's producing a far better argument than you are.
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Originally posted by: Sahakiel
Actually, no, what I assumed was a political landscape similar to the country as it was under the Articles of Confederation.
Already posted.
I use a country as an example when appropriate and international trade when appropriate. If there is any confusion as to which I am using, it is due to inconsistencies in your posts.
If you are not free to live as you please, you are welcome to move anywhere in the world that suits your lifestyle. There is nothing new in your comment.
This is costly, much more costly than moving 20 miles away.
What is so different in your system? The current legal system is also tiered in much the same way. Local matters are handled by local authorities, state level by state, national by Federal, and international by, well, international law.
Are you for real? Federal Law has grown increasingly prevalant. It used to be that some states allowed 18 year olds to drink. The Feds threatened to cut off their state highway funding if they didn't bump it up to 21 years, so the states complied. This is just one example of many.
You are still welcome to move to another city, state, or county in the US. You are also allowed to move to another country if you seem to think you were born in the wrong section of the world.
Ok, I still have to pay federal income tax and FICA. Two things you conveniently forgot. Moving to another country is costly, see above.
The above five points can be addressed by one example : Italian city-states.
The "truth" has not been overlooked by many, as evidenced by the number of people holding cash at home or in non-interest bearing accounts such as checking accounts. While it is true that money retains its value whether in someone's hands or or another person, the problem with hoarding is its effect on the money supply. Perhaps you would understand this a bit more if you understood history, specifically feudal systems.
Now you are arguing with one of the greatest Austrian economists of the 20th century. This is a hoot.
How interesting in that this assumes two things:
1. The economic system is based on gold as the form of currency. Gold Standard, anyone?
2. It conveniently overlooks the nature of money as a medium of exchange.
The article addresses only the issue of whether hoarding reduces the buying power of the entire population. If you were reading carefully, you would have known I had already posted the same results. The problem with hoarding is the impact on economic power. A single extremely wealthy individual wields incredible economic power in much the same way as a large political bloc wields incredible political power in a purely democratic system. I explained this all before. In the long run, the primary effect will be determined by the actions of the major power; amount of capital investment, for example, and is actually insignificant to people during that time. In the short term, the effects can be devastating, and I have already addressed a certain number of problems.
A single extremely wealthy individual wields incredible economic power?! Now you are saying in order to be wealthy you have to hoard? This does not follow from your original premise. That statement is stating the self evident. That is like saying Bill Gates wields incredible economic power, no DUH. I guess we should get the rifle down from the mantle piece and eliminate all billionaires, they are evil "hoarders".
Lol.. You should take a more careful look at who is making wild assertions and who is refuting them with great success. You should also try reading your sources before quoting them without understanding their contents.
The chapter clearly states that hoarding is not a problem. I don't know what other contents are relevant.
Thank you for pointing out your ignorance.
You made a few assumptions:
1. The Fed will inevitably collapse. This can be successfully argued both ways.
2. People will stick to the Fed through thick and thin. This can be successfully disproved.
3. No single entity is infallible. This can also be argued both ways, depending on context.
4. You are representative of the few who can actually perceive the coming danger. Ha. Ha.
5. Nobody else can see anything wrong with the current system. Proven false numerous times.
In other words, your assertion is founded on weak or false premises.
My assertion is time tested: don't put all your eggs in one basket. Giving a single entity: the Fed total control of the monetary system is indeed putting all your eggs in one basket. If the Fed fails about 300 million people will plunge into depression, and this doesn't even take into account the international effects this would have.
Perhaps you are misinterpreting my stance. I simply stated that a group of parties with a common interest should combine their individual resources which have been dedicated to the accomplishment of that goal. The pooling of resources allows greater efficiency assuming a proper implementation. The idea is not derived from Keynsian economics.
If you think I am a Keynesian, then you haven't been paying attention.
If you think I'm a socialist, you are clearly delusional.
You advocate "pooling of resources" yet claim you are not a socialist? All I can say is: WTF. Groups of parties often pool their resources voluntarily, however, what you are advocating is the pooling of resources at the point of a gun (through involuntary taxation).
Military bases can be built in desolate areas, that is true. The problem you ignored is who has to put aside that land? If the alliance is formed with immediate neighbors, then you can arguably use land from all members. This becomes a problem with too many states. If you try to build on land outside of the alliance states, how are you going to get land? Short of a world-wide disaster, virtually every speck of land has been claimed or declared neutral.
So some micro-states voluntarily relinquish part of their less valuable land for the building of military bases.
Water and power can be sold on the free market I never said it wasn't possible. What I did say and you did not address is who will build the power plants and water facilities. I asserted that if a single facility with greater efficiency can satisfy the needs of several interested parties at a lower overall cost, then these parties should pool resources to build the facility. If each party instead builds its own facility to serve its own needs, the overall cost will be higher, the efficiency will be lower, and the facility may be shut down at periodic intervals to avoid overloading (flood and surges in the case of water and electricity).
Most people know that a bank takes the depositors money and uses it to give out loans. Therefore, most people know the bank works on fractional reserve even if they don't know what it is. It's like saying people know how cameras take pictures, but nobody knows about picture developing. Knowledge is not like a math equation.
On a side note, anybody who has done banking before knows how hard it can be to get their money back.
Please provide evidence to back up that claim, beacuse I have heard from several sources that the exact opposite is true: most people have no idea banks operate on fractional reserves.
1. You depend on technology to overcome the inconvenience. As pointed out earlier (and I'm sure you're well aware) computer technology is far from secure and slower technologies open up a loophole.
2. Ignored the issue of stability and local disasters. Once the people dump a currency it is very difficult to get them to use it again. If left to the free market to decide, eventually a small number of currencies (or even a single currency) dominates and replaces local, less popular currencies. Why? If the more common currencies are just as good if not better, then it ties in to the issue of pooling resources. If on the other hand, the local currency is better, it will eventually grow and dwarf the once common currency and the previous possibility will apply.
3. The Euro is literally replacing national currencies.
4. I believe this has been posted: Existence of multiple currency systems promotes disunity. You may not like promoting unity, but I would much rather avoid unnecessary civil disorder.
1. Technology is enabling currency exchanges at a lower cost, this is partly what the digital currencies are all about.
2. Local disasters are speculation, the effects of them could be reduced by having redundant offshore server backups of banking information.
3. Europeans love centralized power, what can I say? However, the private digital currencies have had exponential growth, and could catch up or surpass the Euro in usage within a decade.
4. Unity would still exist with the digital currencies.
Once again, I find the irony quite humorous. Previously, you ranted about the Fed's ability to create money digitally and here you are promoting the use of digital currency.
There is a big difference between having digital currency that is at all times backed 100% by gold, and having a digital currency that is backed by nothing.
Oh, so you're looking for a volunteer organization to contribute its own resources and time to insure the security of your gold deposits. I'm sure the warehouse can be built for free and the security guards will donate their time for free and put their lives on the line for free.
Of course it is not a gold warehouse. Why else would they deposit silver only?
The reason I used it as an example is because the primary difference between gold and silver is the quantity. Silver is more common. The situation is otherwise identical to gold.
It is pointless arguing this, so I will just repeat that a GENUINE gold warehouse in the U.S. that charged reasonable warehousing fees would quickly be pushed out of business by the Fed's monopoly.
The inclusion of Ithaca Hours was used to exemplify the difficulty in finding monopolistic practices on the part of the Federal Reserve Bank. That was the context of the your post to which I used the example. Once again, you are ignoring evidence and throwing up smoke and mirrors.
The Fed has for all intents and purposes a monopoly. People claim Microsoft has a monopoly and yet it has Apple and Linux as a competitor. The Fed's monopoly is MUCH greater than Microsoft's. It is a monopoly, there is no debating this unless you are insane(as the case may be for yourself).
Hence the repeated comments to actually read postings by individuals other than yourself.
Interesting considering the number of times I have used the information in my posts. You must be asserting that I am a genius since you seem to think I am coming up with the same information out of thin air.
The thesis of Rothbard's chapter on hoarding directly contradicts your assertion that hoarding is bad, then you tried to twist this into EVIDENCE for your assertion. Talk about smoke and mirrors.
Well, I can assure you that even my high school didn't follow that model. My college courses especially did not follow that model. Even history courses at both levels promoted individual analysis.
Let's give you a big Nobel prize then. I mean god damn, you can refute the findings of one of the greatest economists of the 20th century.(haha)
The instability of banks was the primary mover for government intervention. While the primary reason for instability was fraud, it had little to do with the actual principle of fractional reserve banking.
The fraud came from two sources:
1. Counterfeiting. Before government intervention, there were literally thousands of currencies in circulation. As such, it was rather easy to counterfeit money.
2. Low reserves. Banks had a tendency to loan out as much money as possible to maximize returns over time. This made it easy to create runs on the bank as loans were defaulted and/or spikes in withdrawals exceeded the amount of money still in the bank.
1. Nice try throwing up smoke and mirrors. Counterfeiting is another issue altogether. Show me data that indicates that counterfeiting had anything to do with bank failures.
2. Low reserves?! Today's banks loan out 90% of their deposits. It doesn't get much lower than that.
The government stepped in during the 19th century to regulate currencies to address the first issue. If I remember correctly, the power to print bills was given to the states and each bill had to conform to certain guidelines.
The Federal Reserve system was created to address the second issue. At the time, investment had gotten out of hand and investors were literally investing $100 worth of money using as little as $1 of their money.
The Federal Reserve system was created to do no such thing. It was created by the same "hoarding" rich men that you mentioned previously in order to make a cartel of their fraud.
A bank operating at full reserve can't give out loans. It would have to charge fees; monthly, per transaction, seigniorage, etc.
Fractional reserve banking is essentially combining your definition of a bank (or gold warehouse) and a lender.
No duh, it would charge fees. It would then take the fees and loan those out. Fractional reserve banking is not combining a gold warehouse and a lender. Read the link about good credit and bad credit above.
Minimum wage has its problems, that's for sure. I believe it confers no long term benefits, as the increase in wage actually becomes inflation. In the short term, a wage increase can hit pretty hard.
For a guy who ranted about independent thought, you have a disturbing habit of posting links to mises.org.
Mises.org has the best refutations of your assertions, and it is the economic school of thought that I subscribe to. If you want to try to use another economic school of thought to refute the Austrian school, go ahead. But for god's sakes, quit pulling stuff out of your @ss and claiming it is it the truth.
I should've said it can work on paper. You know what I meant.
Look, you're never going to convince us. Your whole argument lost credibility before we even got to the body of your message, "hint: It is not money". If that isn't inflammatory, what is? That put everyone in defensive mode, because.. of course it's money.
Like I said, I was beginning to listen to you. The idea that this form of monetary system gives the government the ability to lie and cheat is very disconcerning. However, your approach to reform is not the right one. You are being extreme and overdramatic. Nobody would listen to you, unless they are also prone to believing extreme and overdramatic anti government rhetoric. You are blinded by your own information, unable to even see some of the other points in here for what they are - even if it could compliment your system.
Again, this is not a utopia, and while your ideas may sound good on paper, what about real life? It is infinately more complicated on that level.
Stating the opinions of another man(the man who wrote the book) does not mean anything. Sorry.
And yes, I am calling him a quack. If his ideas were so special, so unique, so well thought out and so much more beneficial - certainly some country in the world would be using that system.
Let's get real here, folks.
You assume that a micro-state 20 miles away will have a political and economic landscape you desire. Given the examples of such a system, it is more probable than not that neighboring micro-states will have similar systems. In that case, if you dislike living in one micro-state, it is highly probably you wil have to move a similar distance as in the current political system in order to find a micro-state in which you find your ideal.
Again, how is that any different than international politics and law?
Once again, if you don't like your current situation, you can move. Assuming you're not a threat to the local society, of course, in which case you'll more than likely be incarcerated. If you're lucky enough to only need to move 20 miles to a neighboring micro-state to find what you're searching, how is that any different than living 20 miles from the national border? Again, think about the probability of finding enough variance between neighboring micro-states.
Considering how often you keep quoting economists of the Austrian school, I'm surprised you noticed this only now. I was also surprised at your unerring faith in the perfection of his arguments and the principles of Austrian economics as a whole. For that reason, I posted a comment about insanity, genius, and fanaticism that, unsurprisingly, has been apparently lost on you.
Incorrect. The reasoning proceeds as follows: Hoarding leads to increased wealth. Extremely wealthy persons wield large economic power. Given a hoarder who achieves extreme wealth, he will wield large incredible power. I also made no mention of the morality of hoarders, only their magnified ability to manipulate the economics landscape. Now go back and re-read my post.
You "understand" the article only through its literal text. That is what I mean when I say you don't understand the contents. I cannot recall much, if any, discussion from you that is not clearly written directly inside the articles.
The articles only address issues in a limited context. This is not a lapse in their part. Rather, it is merely due to the fact that the articles are small compared to the size of the issues which they address. As such, the reader is required to fully analyze the implications of the actual text in order to begin to understand their full meanings.
However, you are assuming that the Fed exercises total control over the monetary system. I have already gone into this earlier and the conclusion was that while the Fed wields large influence it is not complete. The Fed literally cannot enforce complete control over the use of currency by not only 300 million US citizens, but also the large proportion of the rest of the world that depend on the US dollar.
The Fed has already failed on more than one occasion and I don't recall any depressions afterwards. If you had taken a macroeconomics course, you would know how the Federal Reserve system works. Ideally, the system prevents untoward effects on the economy. In reality, it has instead been much better at buffering. It is not impossible that the Fed will ultimately be the direct cause of economic collapse. It is also possible that a meteor will strike the Earth and eliminate >98% of life on the planet.
Two things:
1. The act of pooling resources is not the definition of socialism. Socialism is dissolving private ownership and transferring property into the public domain. The most extreme form I know is communism, where all property is public and each individual only receives what he or she needs. With socialism, individual greed and advancement is minimized or removed entirely.
2. If you had actually understood my posting, you would have seen that what I wrote was not socialism. I made no mention of forced sharing. I did mention pooling resources for a common agenda and derived the benefits of such an activity based on the assumption of greater efficiency. Simple logic and level-headed thinking yields the following corrollary: If the venture does not provide any gain or is in fact detrimental to the parties involved, there is no need to pool resources for a common goal.
In that case, said micro-states are then bearing greater costs for the military bases. If no micro-state has any land which is cheap enough for the micro-state to bear the cost alone, then compensation is required else the micro-state will quickly collapse economically.
High school curriculum usually includes an economics course. Barring that, a US history course is sufficient. Assuming a worthless school system, take a look at the number of college graduates; such courses are required for freshmen or sophomore year.Most people know that a bank takes the depositors money and uses it to give out loans. Therefore, most people know the bank works on fractional reserve even if they don't know what it is. It's like saying people know how cameras take pictures, but nobody knows about picture developing. Knowledge is not like a math equation.
On a side note, anybody who has done banking before knows how hard it can be to get their money back.
Please provide evidence to back up that claim, beacuse I have heard from several sources that the exact opposite is true: most people have no idea banks operate on fractional reserves.
Then, there is the evidence you are citing. It is more of a question of whether studies determine if people can answer the question, "What is the fractional reserve system?", "With what banking system are US banks operating?", and "Do you know how a bank makes money?". The last question or another similar to it is more likely to elicit correct answers.
Again, I am quite amused that you approve of digital currencies when you have ranted on the Fed's abilities with digital banking systems.
Again, you are assuming a perfect digital system immune to the problems that currently plague computer systems.
Local disasters are not speculation. There are countless examples of local economies collapsing and taking years to recover (some are still hurting after several years).
Again, how are you going to address the problems with computer systems? You reference offshore server backups of banking information which means your banking information is running on computer systems. Looking at your other posts, it is more than likely the currency is digital as well.
I assume this is due to the influence of the internet. In which case, such growth is likely to be influenced by the evolution of the digital realm. At any rate, exponential growth is untenable over the long run for any economic system. It would be interesting to see what become the limits of growth.
Unity would be more likely to foster among individuals that use digital currency as the primary currency system. Unity among individuals who use it as a secondary system for transactions outside the local economy would be similar to unity among North American nations.
Once again, I find the irony quite humorous. Previously, you ranted about the Fed's ability to create money digitally and here you are promoting the use of digital currency.
Of all the currencies I know, digital or otherwise, none are backed by nothing. Such a situation would violate the definition of money and currency.
It is only pointless if the conclusion cannot be refuted.
Your assertion has been refuted. Re-stating the assertion is not evidence.
Again, you are avoiding the issue and simply restating your assertion. A monopoly is defined by exclusive ownership or control. In the case of the Fed and the currency system as a whole, such a situation has been proven false.
Microsoft is not clearly a monopoly. If it were the case, the legal wrangling involved in the anti-trust case would not have happened. It had been a monopoly at the very least, which is why the company eventually lost. Currently, the situation is such that at the very least, Microsoft is the only major player in the OS market. The company is now at most a weak example of a monopoly.
Again, reference above and previous posts. Especially pay attention to issues of context and the original post as well.
The Nobel prize is given for original work with the greatest influence. Work of that level requires a singular composition, of which my postings are obviously not.
The greatest scientists in history have been wrong on numerous occasions. Sometimes, their mistakes are famous. Just because an individual is judged "great" does not mean the individual is automatically correct in all occasions.
On the same vein, every single proof depends on a number of assumptions. The simplest method to refute a proof is by proving the assumptions incorrect. If I have successfuly refuted the work of one economist it is likely due to your quoting it out of context.
You did pass history, is that correct? If so, recall the literally thousands of banks circulating notes before Federal intervention. If not, I suggest reading.
Before Federal intervention, it was quite possible to loan greater than 90% of deposits. Before banks lost the ability to print notes, they could print more than 100% worth. During Black Tuesday, banks were no longer printing notes, but investments could be made with something like 10% of actual money. In other words, you could buy $100 worth of stock for $10, paying the rest later with other funds or earnings from the stock. However, losses had to be paid in full.
Basic US history.
Speaking of wild assertions...
Short of a century long worldwide conspiracy involving every single historian, economist, related records and textbooks, as well as bankers, the entire population of the world in the year the Reserve sytem was born, and likely many other entities I failed to mention, there is no evidence backing your assertion.
However, there is evidence to back the recorded history of the reasons for the creation of the Federal Reserve system.
The article assumes a bank can loan more money than has been deposited in its account. It assumes the bank has the ability to create money where none existed by printing notes for more money than it has. This was one of the reasons for bank collapses as I said earlier. The article argues against fractional reserve banking when the bank loans multiples of the money in its account. The article advocates banking by loaning the money deposited by the account holder. This is essentially the current system, where the bank cannot loan more money than its own funds plus a certain percentage of its deposits without borrowing from another bank.
Fractional reserve banking operates as a gold warehouse by holding on to depositor's money and a lender by loaning money. Instead of charging fees (or in addition to) the bank is allowed to loan a certain percentage of that money. At any time, all deposits can be withdrawn in their entirety. Thus, the bank acts as a warehouse and a lender at the same time.
It seems you have swallowed the Austrian school hook, line and sinker. That's fine by me, except when you push for independent thought and quote out of context, thus exhibiting a lack of analysis on your part. In fact, you keep belitting many posts that exhibit a hint of thinking with even a hint of a conclusion that could be contrary to your position.
When you say I keep pulling stuff out of my rear, you are stating that I create statements out of nothing. More than anyone else, you should realize the fallacy of such an assertion.
Occasionally, I have stated data and/or analyses with which you later agree and even occasionally pull quotes from mises.org that repeat my posting. I have also provided counter-arguments refuting some of your assertions based on fallacies in your presentation. I have provided outside information from other sources of which you yourself have occasionally acknowledged. I have also presented my own analyses and conclusions using existing data, in effect practicing the independent thought for which you argued.
In response, you have attacked character on numerous occasions. You have ignored data from posts regardless of their source. You have ignored reasoning without bothering to refute them by logic or data. You have also contemptuously derided several assertions out of hand. When you do try to refute assertions of counters, you have used insults and derision. Resulting counters have been met with the exact same reasoning that had been previously refuted. You have repeatedly quoted from one source as if it were the Bible with little or no analysis that cannot be found within the linked source. You have been shown to present logical fallacies on several occasions, to which you ignore or deride the poster. Your posts have become increasingly hostile with an increasing number of commentary.
It is a wonder you would accuse others of pulling stuff out of their rears.
At the time of widespread adoption, communism was the best idea. For the people of Russia, it was less alien than capitalism and capitalist backers were weak and corrupt. Everything else is history.
On the other hand, sometimes the best ideas are never used. Thus the rise of "what if" scenarios in history-based games.
Once again, a scholar is not necessarily correct all the time. Scholars are simply regarded as being less likely to be incorrect. At the same time, it is quite possible to have multiple scholars with differening opinions, any of which can hold equal weight.
Also recall the scholarly stature of those who proved the geocentric model of the universe.
Communism had one fatal flaw: It did not properly account for human nature.
On a side note, communism works very well for computer systems.
I believe it was you who stated that the writing on bills changed when the currency system changed. The quoted statement applied to the currency system before the change, and the new statement that exists now applies to the new system.
- Jan 17, 2004
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Originally posted by: Sahakiel
You assume that a micro-state 20 miles away will have a political and economic landscape you desire. Given the examples of such a system, it is more probable than not that neighboring micro-states will have similar systems. In that case, if you dislike living in one micro-state, it is highly probably you wil have to move a similar distance as in the current political system in order to find a micro-state in which you find your ideal.
No, because as I said, I would have to move out of the entire country to escape Federal law, income taxes and FICA. Under micro-statism myself and everyone else would be able to live in the state that suits them. In fact I plan to move to New Hampshire as part of the Free State Project to exercise the ability to increase my freedoms as much as possible without leaving the country. Once again though, I will fall under Federal jurisdiction, making this move less than perfect.
Again, how is that any different than international politics and law?
Federal law is a subset of international law. That's a no brainer.
Once again, if you don't like your current situation, you can move. Assuming you're not a threat to the local society, of course, in which case you'll more than likely be incarcerated. If you're lucky enough to only need to move 20 miles to a neighboring micro-state to find what you're searching, how is that any different than living 20 miles from the national border? Again, think about the probability of finding enough variance between neighboring micro-states.
Canada and Mexico are even worse for different reasons. There is quite a bit of of variance between the states that we have now, one can deduce that there would be even greater variance under micro-statism. Federal law of course hinders this variance greatly.
Considering how often you keep quoting economists of the Austrian school, I'm surprised you noticed this only now. I was also surprised at your unerring faith in the perfection of his arguments and the principles of Austrian economics as a whole. For that reason, I posted a comment about insanity, genius, and fanaticism that, unsurprisingly, has been apparently lost on you.
All I'm saying is that it is very unlikely that you have the faculty to refute Rothbard's findings. He devoted his entire life to economics, the portion of the book you read is merely a product of countless hours of his studies. He merely put it in a form that non-PhDs can understand. Now, when it comes to other great economists such as Keynes, many of his findings have already been shot down by his colleagues, so if you want to post something from an economist of similar stature that attempts to refute Rothbard's findings go ahead. Trying to do so yourself is not going to carry much weight with me or anyone else. It is akin to me arguing with a brain surgeon on the best way to perform a particular procedure. The brain surgeon's findings could be inaccurate but I am in no position to attempt to refute them.
Incorrect. The reasoning proceeds as follows: Hoarding leads to increased wealth. Extremely wealthy persons wield large economic power. Given a hoarder who achieves extreme wealth, he will wield large incredible power. I also made no mention of the morality of hoarders, only their magnified ability to manipulate the economics landscape. Now go back and re-read my post.
I don't know how more evident Rothbard could be in this matter. If what you said is true about dangers of wealthy hoarders then Rothbard's statement would be false, which leads us to what I said above, find an economist of similar stature who states that his findings are false.
You "understand" the article only through its literal text. That is what I mean when I say you don't understand the contents. I cannot recall much, if any, discussion from you that is not clearly written directly inside the articles.
The articles only address issues in a limited context. This is not a lapse in their part. Rather, it is merely due to the fact that the articles are small compared to the size of the issues which they address. As such, the reader is required to fully analyze the implications of the actual text in order to begin to understand their full meanings.
Read above, Rothbard is very clear in his meanings. Hoarding brings no loss to society, ever.
However, you are assuming that the Fed exercises total control over the monetary system. I have already gone into this earlier and the conclusion was that while the Fed wields large influence it is not complete. The Fed literally cannot enforce complete control over the use of currency by not only 300 million US citizens, but also the large proportion of the rest of the world that depend on the US dollar.
The Fed has already failed on more than one occasion and I don't recall any depressions afterwards. If you had taken a macroeconomics course, you would know how the Federal Reserve system works. Ideally, the system prevents untoward effects on the economy. In reality, it has instead been much better at buffering. It is not impossible that the Fed will ultimately be the direct cause of economic collapse. It is also possible that a meteor will strike the Earth and eliminate >98% of life on the planet.
The Fed has never failed in the sense that it went under. However, the Fed caused the Great Depression by expansion of credit, if you don't think this could happen again then you are gravely mistaken. The men who run the Fed are not gods of economics, they cannot predict future economic events and perform the correct actions for all outcomes. Caclulating the probability of the Fed's failure is probably impossible, but the welfare of millions if not billions depend on it. This exposes these people to great risk, no matter what the chance of the Fed going under is. Would you put a gun to one of your family member's head and pull the trigger even though it only had a 1 in a million chance of going off? Of course not, you would be exposing them to great danger even though the odds are very small that it will go off. By putting your economic welfare entirely in the hands of the Fed, you are putting you and your family's livelihood in the hands of the Fed, which is exposing them to unnecessary risk.
Two things:
1. The act of pooling resources is not the definition of socialism. Socialism is dissolving private ownership and transferring property into the public domain. The most extreme form I know is communism, where all property is public and each individual only receives what he or she needs. With socialism, individual greed and advancement is minimized or removed entirely.
2. If you had actually understood my posting, you would have seen that what I wrote was not socialism. I made no mention of forced sharing. I did mention pooling resources for a common agenda and derived the benefits of such an activity based on the assumption of greater efficiency. Simple logic and level-headed thinking yields the following corrollary: If the venture does not provide any gain or is in fact detrimental to the parties involved, there is no need to pool resources for a common goal.
Ok, who ever said that no one could/would pool resources voluntarily in a micro-state system? Suddenly because the country consists of micro-states no one can help anyone else out? B.S. I never implied any such thing.
In that case, said micro-states are then bearing greater costs for the military bases. If no micro-state has any land which is cheap enough for the micro-state to bear the cost alone, then compensation is required else the micro-state will quickly collapse economically.
There are millions of acres of unused land in the U.S. giving up a cheap portion for a military base would not be economically detrimental to a micro-state. I fund it odd you would even argue this.
High school curriculum usually includes an economics course. Barring that, a US history course is sufficient. Assuming a worthless school system, take a look at the number of college graduates; such courses are required for freshmen or sophomore year.Most people know that a bank takes the depositors money and uses it to give out loans. Therefore, most people know the bank works on fractional reserve even if they don't know what it is. It's like saying people know how cameras take pictures, but nobody knows about picture developing. Knowledge is not like a math equation.
On a side note, anybody who has done banking before knows how hard it can be to get their money back.
Please provide evidence to back up that claim, beacuse I have heard from several sources that the exact opposite is true: most people have no idea banks operate on fractional reserves.
Then, there is the evidence you are citing. It is more of a question of whether studies determine if people can answer the question, "What is the fractional reserve system?", "With what banking system are US banks operating?", and "Do you know how a bank makes money?". The last question or another similar to it is more likely to elicit correct answers.
Ok, go do a survey and ask a random selection of people those questions and post the results, or link to a survey that has conducted a scientifically accurate poll. Until then please do not make unsupported claims. As far as I know, in my experience the average person hasn't a damn clue how banking works.
Again, I am quite amused that you approve of digital currencies when you have ranted on the Fed's abilities with digital banking systems.
Again, you are assuming a perfect digital system immune to the problems that currently plague computer systems.
As I have said before. There is a distinct difference between the gold backed digital currencies and the Fed. The Fed does not claim to back up its paper currency with anything (contrary to the misguided belief of some), the gold backed digital currencies claim to have gold backing all of the digital currency that is issued. Then the digital currency sites provide support for that claim with audits, and transparency of their holdings. To claim that gold backed digital currencies are the same as unbacked U.S. currency is nonesense. They are distinctly different. Am I saying that digital currencies cannot succumb to fraud? Of course not, but Rothbard explains how the free market weeds out the fradulent fractional reserve scammers. My question to you is: what is better, a currency you KNOW is unbacked or a currency that is beyond a reasonable doubt backed by gold? Computer systems are not infallible, but all of the digital currency sites I have been to appear to have very strong security in place. If you can hack any of them be my guest, then post evidence of having done so.
Local disasters are not speculation. There are countless examples of local economies collapsing and taking years to recover (some are still hurting after several years).
Again, how are you going to address the problems with computer systems? You reference offshore server backups of banking information which means your banking information is running on computer systems. Looking at your other posts, it is more than likely the currency is digital as well.
Computer systems are not infallible, hence the backups. With multiple backups in seperate and discrete locations the probability of a disaster completely wiping out an economy are very small. To say that it is impossible to set up such a system is ridiculous, because they have already been set up in other non-related enterprises.
I assume this is due to the influence of the internet. In which case, such growth is likely to be influenced by the evolution of the digital realm. At any rate, exponential growth is untenable over the long run for any economic system. It would be interesting to see what become the limits of growth.
True, but that depends on what you define to be long run. It could certainly have a long enough run to surpass the usage of the Euro, especially if people dump the Euro for the gold backed digital currencies.
Unity would be more likely to foster among individuals that use digital currency as the primary currency system. Unity among individuals who use it as a secondary system for transactions outside the local economy would be similar to unity among North American nations.
I don't see how that would be a problem.
Once again, I find the irony quite humorous. Previously, you ranted about the Fed's ability to create money digitally and here you are promoting the use of digital currency.
Read above, the Fed makes no promises, the digital currencies do or else they would be out of business fast.
Of all the currencies I know, digital or otherwise, none are backed by nothing. Such a situation would violate the definition of money and currency.
For all intents and purposes FRTs have no backing. The amount of gold in the Fed's and Treasury's vaults is miniscule compared to the $11 trillion economy. Furthermore, the government makes no guarantees about its backing, if FRTs became worthless the government wouldn't owe anyone anything. If you can provide material to the contrary please do, because I do not know of any law/clause that says that the government would have to pay someone something if the FRT became worthless.
It is only pointless if the conclusion cannot be refuted.
Your assertion has been refuted. Re-stating the assertion is not evidence.
Ok, set up a genuine gold warehouse in the U.S., or show me one that is in existence that only charges 2-3% initially to store your gold there and not more than 1% a year after that.
Again, you are avoiding the issue and simply restating your assertion. A monopoly is defined by exclusive ownership or control. In the case of the Fed and the currency system as a whole, such a situation has been proven false.
Microsoft is not clearly a monopoly. If it were the case, the legal wrangling involved in the anti-trust case would not have happened. It had been a monopoly at the very least, which is why the company eventually lost. Currently, the situation is such that at the very least, Microsoft is the only major player in the OS market. The company is now at most a weak example of a monopoly.
No economist would define a monopoly to only be 100% total control over a particular market. If there is one, please point me in their direction. As I have said before, the Fed has a monopoly on U.S. currency, pointing to a currency that is probably less than 1% of all transactions and claiming the Fed does not have a monopoly is ridiculous.
Again, reference above and previous posts. Especially pay attention to issues of context and the original post as well.
See Rothbard's statement, it can't get any clearer.
The Nobel prize is given for original work with the greatest influence. Work of that level requires a singular composition, of which my postings are obviously not.
The greatest scientists in history have been wrong on numerous occasions. Sometimes, their mistakes are famous. Just because an individual is judged "great" does not mean the individual is automatically correct in all occasions.
On the same vein, every single proof depends on a number of assumptions. The simplest method to refute a proof is by proving the assumptions incorrect. If I have successfuly refuted the work of one economist it is likely due to your quoting it out of context.
See above, your stature is not great enough to argue with Rothbard.
You did pass history, is that correct? If so, recall the literally thousands of banks circulating notes before Federal intervention. If not, I suggest reading.
Thousands of banks circulating notes does not mean mass counterfeiting. I don't follow how your statement is relevant to counterfeiting which was the initial issue you brought up.
Before Federal intervention, it was quite possible to loan greater than 90% of deposits. Before banks lost the ability to print notes, they could print more than 100% worth. During Black Tuesday, banks were no longer printing notes, but investments could be made with something like 10% of actual money. In other words, you could buy $100 worth of stock for $10, paying the rest later with other funds or earnings from the stock. However, losses had to be paid in full.
Basic US history.
They were comitting fraud, legalizing fraud and saying that it can only be comitted to X degree does not eliminate fraud. Even if the Fed raised the reserve requirement to 99% it would still be fraud.
Speaking of wild assertions...
Short of a century long worldwide conspiracy involving every single historian, economist, related records and textbooks, as well as bankers, the entire population of the world in the year the Reserve sytem was born, and likely many other entities I failed to mention, there is no evidence backing your assertion.
However, there is evidence to back the recorded history of the reasons for the creation of the Federal Reserve system.
Read the history of how the Federal Reserve Act was passed. It was passed only a couple days before Christmas when most legislators had gone home for the holidays. To say there was no conspiracy behind the passage of the Federal Reserve Act is to deny what is blatant.
The article assumes a bank can loan more money than has been deposited in its account. It assumes the bank has the ability to create money where none existed by printing notes for more money than it has. This was one of the reasons for bank collapses as I said earlier. The article argues against fractional reserve banking when the bank loans multiples of the money in its account. The article advocates banking by loaning the money deposited by the account holder. This is essentially the current system, where the bank cannot loan more money than its own funds plus a certain percentage of its deposits without borrowing from another bank.
Fractional reserve banking operates as a gold warehouse by holding on to depositor's money and a lender by loaning money. Instead of charging fees (or in addition to) the bank is allowed to loan a certain percentage of that money. At any time, all deposits can be withdrawn in their entirety. Thus, the bank acts as a warehouse and a lender at the same time.
At any time, all deposits can be withdrawn in their entirety?? While I have qualms about your interpretation of the article I am going to stop right there. It is evident that you lack understanding of fractional reserve banking. All deposits CANNOT be withdrawn in their entirety at anytime. The only way this could be done is if the Fed bails the bank out, or simply prints the missing money.
It seems you have swallowed the Austrian school hook, line and sinker. That's fine by me, except when you push for independent thought and quote out of context, thus exhibiting a lack of analysis on your part. In fact, you keep belitting many posts that exhibit a hint of thinking with even a hint of a conclusion that could be contrary to your position.
When you say I keep pulling stuff out of my rear, you are stating that I create statements out of nothing. More than anyone else, you should realize the fallacy of such an assertion.
Occasionally, I have stated data and/or analyses with which you later agree and even occasionally pull quotes from mises.org that repeat my posting. I have also provided counter-arguments refuting some of your assertions based on fallacies in your presentation. I have provided outside information from other sources of which you yourself have occasionally acknowledged. I have also presented my own analyses and conclusions using existing data, in effect practicing the independent thought for which you argued.
In response, you have attacked character on numerous occasions. You have ignored data from posts regardless of their source. You have ignored reasoning without bothering to refute them by logic or data. You have also contemptuously derided several assertions out of hand. When you do try to refute assertions of counters, you have used insults and derision. Resulting counters have been met with the exact same reasoning that had been previously refuted. You have repeatedly quoted from one source as if it were the Bible with little or no analysis that cannot be found within the linked source. You have been shown to present logical fallacies on several occasions, to which you ignore or deride the poster. Your posts have become increasingly hostile with an increasing number of commentary.
It is a wonder you would accuse others of pulling stuff out of their rears.
Ok, assuming that is all true, you are still wrong, but to tell you the truth I now actually feel bad about my hostility. Stating the reason for this would probably be perceived as hostile all in itself, so I won't.
Only to be replaced by any international treaties between micro-states (assuming larger ones don't swallow smaller ones) and international law would still be in place. It's like exchanging a cargo freighter for a bunch of smaller boats. You've changed boats, but if you take a close look you really haven't changed anything.
Considering you claimed to have taken a class on deductive reasoning, it is quite surprising for you to use the fact that somebody else published the result to your theory as the sole basis for your claim. Once again, I wonder whether you learned anything from that course, hit a nice instance of grade inflation, or are lying through your teeth. Anyone who has learned a lick of reasoning knows that citing credentials is irrelavent.
Along a simliar vein, every proof relies on at least one assumption. Proving those assumptions incorrect or inapplicable has been strikingly easy and the resulting tantrum has been amusing, to say the least.
I could start pulling quotes and linking sources off the internet. However, he who must depend on quoted sources hasn't graduated from high school. Anybody can memorize information. Those who can use it go on to post-graduate study.
As I said before, credentials mean nothing in discussion and if you must insist on flashing paper then you are both obviously in need of an education and quite welcome to drop by the school. Visitors are always welcome.
Playing "parrot" is ignoring evidence. It is quite effective at stopping arguments, but in the end the parrot is stuck in the sand while the seas collapse.
The whole concept of trade and open/closed economic systems seems to be escaping you.
Are you advocating the old Gold Standard, bimetallism or, God forbid, fiat money systems?
Perhaps you are mistaken. If I recall correctly, when I brought up pooling of resources, you called me a socialist. After clarifying my position, you seemed to think I'm saying micro-states would be unable to share anything at all. In order to clarify my position yet again, I pointed to an example even the most mediocre student could remember. It seems I cannot get you to understand my point.
I posted this:
At no point whatsoever does it imply that pooling resources is not allowed. At no point does it imply that pooling is required. For the hundredth time, please attempt to read my post instead of picking and choosing words to suit your agenda.
Micro-states covering the continental US of the size of current states leads to the exact situation I described earlier. Using smaller micro-states I recently addressed. Using larger states yields the current US. With varying sizes, you get the current geography. In other words, there is very little difference between a micro-state and a large nation. The primary size limitations are still population, geography, and resources. A large number of similar micro-states will eventually merge. A large state spread over too diverse populations will eventually split. Take a "wild guess" as to where the equilibrium point lies.
I pointed out city-states quite a few times.
Yet another example of your partial understanding of money. You almost had it, but then you went back into left field. Every currency system is backed by one thing or another. Without that backing, the money isn't "money" but simply another random good. It is the third-party nature of money that makes money what it is, and that requires backing.
It is true that dollar bills are now no longer formally backed by gold, silver, or any other precious metal. If you read any of my posts, you would have known I have not once stated or implied otherwise.
However, the backing for fiat money is exactly the backing for gold. The full faith and trust in the value of the exchange. You admitted to understanding that gold doesn't require backing; it IS the basis for a gold- based currency system. Dollar bills are no different. It is not accident that more dollars are in circulation in foreign lands than within the borders of the United States.
The intrinsic value of a dollar bill is far less than its face value. The intrinsic value of gold is also far less than its face value. The value of gold is artificially inflated by demand. People demand gold because of its long history as the form of currency. Precious metals were used as currency not because they were born as money, but because they were scarce enough to avoid oversupply, impossible to fake, and more convenient than large stone rings or livestock. Without that history, gold is just as worthless as that paper in your wallet if neither were used as currency. Well, it might be a more valuable due to the current level of electronics technology.
Well, you're still in the United States, so it seems you have chosen a similar path.
Once again, how stupid do you think I am?
I never said the current system is invulnerable. Perhaps you are misinterpreting my words again.
What I argued is that complete reliance upon digital systems as the medium of exchange is inherently insecure due to the nature of said systems.
Yet, you are so willing to put your faith in legions of strangers. How utterly ironic.
No offense, but you either asked the wrong question or posted the wrong answer. If you think it's that easy to shed liability, it's time for some very long thinking on your part.
The Fed does not have a monopoly on the currency market. Billions of dollars worth of foreign currency are traded every day within the borders of the US. As I said before, the Fed is a major player, but not quite a monopoly. If you're referring to printing bills, that's another issue. The Euro, by the way, is actually doing rather well against the US dollar given its short history.
If you must wonder, then you have learned nothing at all through this entire discussion. A statement is not endowed with newfound validity just because a master has spoken them. For the same reason, the words of a novice such as you are not ignored simply because of you status. Ideas and theories stand and fall on their own. Rothbard may state a good case, but like all theories it has its limitations and flaws. Only fanatics ignore those.
Pick up your history book right now and thumb through it, for once. Barring that, a quick search Google popped up a few sources off the top.
Counterfeiting was not the primary reason, but it was significant enough to be worth mentioning.
And, once again, you are missing the key point. The funds are always available. You even mentioned the bank would be forced to borrow money if necessary.
A simple storehouse would simply hold on to the money for a small fee. A simple lending institution would loan its own money and simply charge interest or fees. A bank can do both. All three instutions carry risks and can collapse for the same reasons.
No, you almost got it. You almost got it a second time. Reference above.
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