The American Dream

[scooterbug44]

I understand now. I don't have the answer to the finer points of a transition. It will take some time and some work. It will not be simple. You can be assured the government has a plan right now for Continuity of Operations.

If the Fed doesn't allow gold to back their currency then we will be forced to default on them. They don't want that of course, so they will backstop our debt with gold so that we may continue to pay on the debt. Raising the debt ceiling assures this and QEIII.

Keep in mind the US is the largest gold holder in the world by a large factor. If we adopt our own sovereign currency, the price of gold will rise enough to absorb the amount of wealth created from the printing of the previous FRNs. Once that ratio has been established, we lock the supply of our new money and it is indirectly backed by our gold stores as a promise to pay.

Liquidity and easy, high-interest money will be gone, but stability, honest accounting and financial freedom will be the result.

So your plan to fight over-valued currency, eliminate debt, and stave off inflation hinges upon drastically increasing the value of an already (IMO) overvalued commodity?

Sounds a bit bubbly and speculative.

What happens if we base our currency on goldand it decreases in value?

 

[TNJed]

So your plan to fight over-valued currency, eliminate debt, and stave off inflation hinges upon drastically increasing the value of an already (IMO) overvalued commodity?

Sounds a bit bubbly and speculative.

What happens if we base our currency on goldand it decreases in value?

Gold became a commodity when the world's reserve currency became fiat.

When it becomes the monetary standard it will not be a commodity.

3000 years of history says it's stable. It is not reproducible, unlike paper or binary digits.

History is not on the Feds side. I will continue to let history be the decider.

And it's not MY plan. It's a reversion to the mean. This is how it was before. I wanted to know what money was and where it came from. I stumbled upon all this by standing on the shoulders of giants.

I think I have posted quite enough. There is more than enough information in this thread to lead you to where I think your answers lay. I don't have all the answers. I wanted to share what I've learned thus far. I wish you all nothing but the best in your continued quest for answers. I will be doing the same

edit: last but not least....there is a whole other world beyond this conversation in the PMs. Here is a good forum to get specific PM info should you choose that path.

https://www.kitcomm.com/forumdisplay.php?f=15

 

[robertsondavies]

The corporate profits conundrum is completely unexplained. Books will be written about it. My take is that deflation has brought down basic material costs and labor while prices have been kept high by sellers.

In one respect though I think your assumption is right, trillions in money printing to buy worthless or low yield assets from corporate america frees up a lot of cash for investing.

Here's a good question - How will QE2 effect the market over the next year? Last year the market crashed after the FEDs MBS purchases ended. Then they promised QE2 and boom, six months of good times. How long will the presses run this year, and what happens after they stop, and will they kick back in again if things crash again?

Artificial forces are in control and have been for well over two years. Investing isn't much different from taking a trip to Vegas at this point.

The David Tepper trade is intact, and will be, until shorts are broke,... nominally at least.

 

[robertsondavies]

Overwrought? You brought up a fantasy future bread line. I showed you where they are hidden in plain sight today.

Bernanke was a professor before becoming the Fed chairman. He is a student of the Feds Keynesian policy. All the ivy league schools are. That's the incubator of the puppets.

We were the world's largest creditor before now. Now we are the world's largest debtor. This time, it is different by 180 degrees.

Gold is nothing but a shiny yellow metal. This is a tulip bulb phase. Gold's industrial worth is probably around $30 per oz... and jewelry demand puts it around $80. the rest is exuberant speculation, that will end in tears.

My advice: buy some JOE stock and short GLD, FCX, GG, NEM, KGC . . . then pour a drink and watch the profits roll in.

 

[Bob]

Overwrought? You brought up a fantasy future bread line. I showed you where they are hidden in plain sight today.

Bernanke was a professor before becoming the Fed chairman. He is a student of the Feds Keynesian policy. All the ivy league schools are. That's the incubator of the puppets.

We were the world's largest creditor before now. Now we are the world's largest debtor. This time, it is different by 180 degrees.

sorry, posted too fast. i was referring to the great depression. It's not fantasy. bernanke has studied the great depression, and has averted chaos which would have occurred a la paul. check your fear. things could be much worse.

 

[30ashopper]

sorry, posted too fast. i was referring to the great depression. It's not fantasy. bernanke has studied the great depression, and has averted chaos which would have occurred a la paul. check your fear. things could be much worse.

Had the FED not existed, we may not have gotten into this mess in the first place. I'm not so sure we're better off with a FED.

 

[futurebeachbum]

Had the FED not existed, we may not have gotten into this mess in the first place. I'm not so sure we're better off with a FED.

I'd prefer to move away from organizations that are too big to fail. Its time to carve up the megabanks like BOA and go back to regionally or state sized banks.

One lesson we learned in The Depression (and apparently forgot in the 80's & 90's) was to eliminate big, interstate banks. If we went back to that model today, there wouldn't be any banks that were too big to fail .

 

[TNJed]

I'd prefer to move away from organizations that are too big to fail. Its time to carve up the megabanks like BOA and go back to regionally or state sized banks.

One lesson we learned in The Depression (and apparently forgot in the 80's & 90's) was to eliminate big, interstate banks. If we went back to that model today, there wouldn't be any banks that were too big to fail .

Bingo.

Look no further than the Bank of North Dakota. Only state owned bank in the country. Only bank to run a surplus. Est. 1919


Bank of North Dakota

 

[DuneAHH]

Bingo.

Look no further than the Bank of North Dakota. Only state owned bank in the country. Only bank to run a surplus. Est. 1919


Bank of North Dakota

Where does one find trustworthy financial stats on every single bank in the country?

Surely there are some other surplus healthy local/regional banks besides Bank of North Dakota?

The long term success of BofND certainly implies a worthy model for a Nationally issued/managed currency.

I am NO FAN of The Fed, their secrecy and abuses. Nor do I believe that USA's dysfunctional marriage with the abusive Fed can be 'counseled' into health. Sometimes divorce is highly warranted. IMO, this is one of those instances.

I am a huge proponent of re-localizing to community/regional banks that are chartered / regulated by the given state's laws & banking associations. Banks populated by human beings that one can meet with face-to-face because they're located in close enough community proximity to understand local economies, marketplaces, and customers. Banks that ONLY deal in the business of banking... whose primary reason for being is to service the community; not scramble/sniff around intent on competing with and destroying their customers and the community's businesses by exploiting the equivalent of "insider trading" practices.

 

[scooterbug44]

That is not the only healthy bank.

My hometown bank (now has 3 locations and 100 employees after 20 years) came through smelling like roses - their fuddy duddy policies of not loaning outside the county and not getting involved in sub-prime lending paid off big. ;-)

Of course, that is what happens when you have a community bank whose board of directors is the same group of local business owners that started it decades ago and whose first priority is to the community and providing good service.

And the fact that they have some of the best rates in town, think long term, and have humans answering the phone and providing excellent service doesn't hurt them one bit either.