Comments on: In Government We Trust?

By: Pump

Pump — Mon, 23 Mar 2009 05:46:54 +0000

Only around 3 percent of the money supply consists of paper money and coins. The remaining 97 percent is created from credit extended by banks that are largely unregulated. The money consists of numbers in account records. In short, what we have is the result not of government regulation but deregulation. The current crisis is caused by subprimes which were largely unregulated. When the interest rates for Option ARMs and Alt As start resetting, and when the rest of the derivatives market (which is also unregulated) start imploding….

Second, some societies actually tried to use gold instead of fiat currency. The problem is that they started hoarding gold and preferred to barter.

Barter is fine, except that it won’t allow an economy to grow rapidly or advance technologically. In short, fractional reserve ratios, interest rates, and fiat currency not backed by precious metals were needed in order to meet credit needs of manufacturers that wanted to increase production significantly. They were also needed to meet credit needs of consumers. Thus, the problem isn’t government regulation or the presence of a fiat currency but the central drivers of free market capitalism, which are overproduction and increasing profits each time.

By: Economic analysis | In Government We Trust? - Contrarian Stock Market Investing News - Featuring Bargain Stocks

Fri, 13 Mar 2009 13:10:05 +0000

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By: OhRama

OhRama — Fri, 13 Mar 2009 01:44:08 +0000

Gold as currency makes sense as it cannot be printed as fast as the paper currency. However, does it not give the control to the mines (the owners and the unionized workers) and the few countries that produce them and leave the rest under their mercy? I always wondered if our lack of support for the independence of South Africa in the early days was indeed connected to our need for easy access to their natural resources including gold (we justified saying it would become a communist country etc.).

By: ralph

ralph — Thu, 12 Mar 2009 22:42:23 +0000

why oh why is it that such intelligence is drowned out by so much ignorance?

if only americans could see the truth in what Ron Paul is saying like a lighthouse in a world of darkness.

No wonder the world is closer to the abyss each day so how can we avoid the catastrophe that we know if before us?

thank Dr Paul for being a single light in an otherwise dark world. If only we had more like you around the world!

By: Hal

Hal — Thu, 12 Mar 2009 22:23:10 +0000

Look. I agree for the most part. And I think gold is great and I think a return to the gold standard would be great. But will it ever happen? Governments like the power that the fiat currency gives them. Our government likes that power. It’s just hard for me to imagine right now. Of course should something more drastic occur to the global economy then I could see countries willingly going to a standard. Or perhaps if people in our country would get smart to the power schemes in DC then maybe, bur for now. I just don’t know. But that’s just my opinion. I do think the value of gold is only going to continue to rise right now because of the warp speed printing press and distrust of Government.

By: Dennis Spain

Dennis Spain — Thu, 12 Mar 2009 21:55:27 +0000

Without a doubt, gold-backed money managed in a non-fractional reserve banking system would be preferable to the present debt-based fiat paper system managed by fractional-reserve institutions. However the problem of debt remains, which is like a millstone around the economy of the world. I would be interested in critiques of this proposal:

Amend the US Constitution to establish a new currency, the American Freedom Note:

All loan contracts, bonds, govt debt originating in Federal Reserve banks, all existing Federal Reserve Notes, checking account balances, are exchanged for American Freedom Notes. Creditors forgo liens and are cashed out 100%. Debtors are exonerated, assume 100% ownership of assets, including—most importantly— the productive assets of the country.

A fixed quantity of AFNs results from this system-wide exchange and these fresh accounts can be loaned at interest rates determined freely in the marketplace, with the strict proviso that no fractional-reserve lending is allowed from that point forward.

Over time a natural deflation occurs and the American Freedom Notes, fixed in quantity by this amendment, acquire increasing purchasing power.

Debt forgiveness, greed forgiveness. The financial elite are bought out, the rest of us indentured servants are freed, no blood in the streets!

By: scooter_mf

scooter_mf — Thu, 12 Mar 2009 20:04:40 +0000

Gaaaargh! How come the Sheep refuse to understand this! If Texas ever exercises their option to leave the Union, I’m moving to Houston!

By: pagehype.com

pagehype.com — Thu, 12 Mar 2009 18:29:27 +0000

In Government We Trust?…

Many who agree with me on a lot of other issues, do not understand my enthusiasm for gold and sound money or why I spend so much time studying and talking about monetary policy. It’s true that I talk about money differently than most, but the fact i…