Home › Forums › Financial Markets/Economics › Are we bankrupt as a country?
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December 29, 2010 at 5:55 PM #647027January 8, 2011 at 7:13 PM #650338
faterikcartman
ParticipantThe whole system works because people produce things and services that others want.
It is very difficult to carry around 1,000 bushels of corn so we use money to represent our labour in order to trade conveniently.
When the supply of goods and services stays the same, but the money supply is increased, once that money goes into circulation the value of each unit of currency falls as traders compete for the same limited supply of goods and services.
Despite an abundance perceived by a few, unlike currency gold cannot be created out of whole cloth or alchemy. Nor does it decay or corrode. Deflating its value by increasing its supply is usually a gradual process rather than one that can be accomplished overnight. And gold is not issued by a government that may default on it. And it is compact and portable.
Ultimately, of course, gold too is just another commodity and its value over time reflects the vagaries of demand based on complex and varied factors.
Still, when presented with a choice of Zimbabwean dollars vs. gold, which would you pick? Gold, of course. Even if Zimbabwe prints more and more money and it becomes virtually worthless, one take take their gold anywhere in the world and it will have value, unlike a currency issued by a particular government.
I’m sure the OP is not alone in looking at the USA and wondering at what point is the dollar significantly weakened or the debt so unmanageable that default or hyper-inflation looms. When the amount of gold reserves are examined one might understandably worry that our system is truly propped up by a belief in growth, rather than hard assets.
Hence, this past year many nations have bought large amounts of gold for their reserves along with exploring other currencies to hold.
Exciting times to be sure!
January 8, 2011 at 7:13 PM #650664ParticipantThe whole system works because people produce things and services that others want.
It is very difficult to carry around 1,000 bushels of corn so we use money to represent our labour in order to trade conveniently.
When the supply of goods and services stays the same, but the money supply is increased, once that money goes into circulation the value of each unit of currency falls as traders compete for the same limited supply of goods and services.
Despite an abundance perceived by a few, unlike currency gold cannot be created out of whole cloth or alchemy. Nor does it decay or corrode. Deflating its value by increasing its supply is usually a gradual process rather than one that can be accomplished overnight. And gold is not issued by a government that may default on it. And it is compact and portable.
Ultimately, of course, gold too is just another commodity and its value over time reflects the vagaries of demand based on complex and varied factors.
Still, when presented with a choice of Zimbabwean dollars vs. gold, which would you pick? Gold, of course. Even if Zimbabwe prints more and more money and it becomes virtually worthless, one take take their gold anywhere in the world and it will have value, unlike a currency issued by a particular government.
I’m sure the OP is not alone in looking at the USA and wondering at what point is the dollar significantly weakened or the debt so unmanageable that default or hyper-inflation looms. When the amount of gold reserves are examined one might understandably worry that our system is truly propped up by a belief in growth, rather than hard assets.
Hence, this past year many nations have bought large amounts of gold for their reserves along with exploring other currencies to hold.
Exciting times to be sure!
January 8, 2011 at 7:13 PM #650204ParticipantThe whole system works because people produce things and services that others want.
It is very difficult to carry around 1,000 bushels of corn so we use money to represent our labour in order to trade conveniently.
When the supply of goods and services stays the same, but the money supply is increased, once that money goes into circulation the value of each unit of currency falls as traders compete for the same limited supply of goods and services.
Despite an abundance perceived by a few, unlike currency gold cannot be created out of whole cloth or alchemy. Nor does it decay or corrode. Deflating its value by increasing its supply is usually a gradual process rather than one that can be accomplished overnight. And gold is not issued by a government that may default on it. And it is compact and portable.
Ultimately, of course, gold too is just another commodity and its value over time reflects the vagaries of demand based on complex and varied factors.
Still, when presented with a choice of Zimbabwean dollars vs. gold, which would you pick? Gold, of course. Even if Zimbabwe prints more and more money and it becomes virtually worthless, one take take their gold anywhere in the world and it will have value, unlike a currency issued by a particular government.
I’m sure the OP is not alone in looking at the USA and wondering at what point is the dollar significantly weakened or the debt so unmanageable that default or hyper-inflation looms. When the amount of gold reserves are examined one might understandably worry that our system is truly propped up by a belief in growth, rather than hard assets.
Hence, this past year many nations have bought large amounts of gold for their reserves along with exploring other currencies to hold.
Exciting times to be sure!
January 8, 2011 at 7:13 PM #649617ParticipantThe whole system works because people produce things and services that others want.
It is very difficult to carry around 1,000 bushels of corn so we use money to represent our labour in order to trade conveniently.
When the supply of goods and services stays the same, but the money supply is increased, once that money goes into circulation the value of each unit of currency falls as traders compete for the same limited supply of goods and services.
Despite an abundance perceived by a few, unlike currency gold cannot be created out of whole cloth or alchemy. Nor does it decay or corrode. Deflating its value by increasing its supply is usually a gradual process rather than one that can be accomplished overnight. And gold is not issued by a government that may default on it. And it is compact and portable.
Ultimately, of course, gold too is just another commodity and its value over time reflects the vagaries of demand based on complex and varied factors.
Still, when presented with a choice of Zimbabwean dollars vs. gold, which would you pick? Gold, of course. Even if Zimbabwe prints more and more money and it becomes virtually worthless, one take take their gold anywhere in the world and it will have value, unlike a currency issued by a particular government.
I’m sure the OP is not alone in looking at the USA and wondering at what point is the dollar significantly weakened or the debt so unmanageable that default or hyper-inflation looms. When the amount of gold reserves are examined one might understandably worry that our system is truly propped up by a belief in growth, rather than hard assets.
Hence, this past year many nations have bought large amounts of gold for their reserves along with exploring other currencies to hold.
Exciting times to be sure!
January 8, 2011 at 7:13 PM #649547ParticipantThe whole system works because people produce things and services that others want.
It is very difficult to carry around 1,000 bushels of corn so we use money to represent our labour in order to trade conveniently.
When the supply of goods and services stays the same, but the money supply is increased, once that money goes into circulation the value of each unit of currency falls as traders compete for the same limited supply of goods and services.
Despite an abundance perceived by a few, unlike currency gold cannot be created out of whole cloth or alchemy. Nor does it decay or corrode. Deflating its value by increasing its supply is usually a gradual process rather than one that can be accomplished overnight. And gold is not issued by a government that may default on it. And it is compact and portable.
Ultimately, of course, gold too is just another commodity and its value over time reflects the vagaries of demand based on complex and varied factors.
Still, when presented with a choice of Zimbabwean dollars vs. gold, which would you pick? Gold, of course. Even if Zimbabwe prints more and more money and it becomes virtually worthless, one take take their gold anywhere in the world and it will have value, unlike a currency issued by a particular government.
I’m sure the OP is not alone in looking at the USA and wondering at what point is the dollar significantly weakened or the debt so unmanageable that default or hyper-inflation looms. When the amount of gold reserves are examined one might understandably worry that our system is truly propped up by a belief in growth, rather than hard assets.
Hence, this past year many nations have bought large amounts of gold for their reserves along with exploring other currencies to hold.
Exciting times to be sure!
January 8, 2011 at 10:39 PM #649717dbapig
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January 8, 2011 at 10:39 PM #649648Participantdelete
January 8, 2011 at 10:39 PM #650303Participantdelete
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January 9, 2011 at 7:47 PM #650083patb
Participant[quote=walterwhite]all monetary units are social constructs.
gold is the only monetary unit that will never completely fail.
all other money will someday not exist.
oil and wheat aren’t money. theya re stuff you buy with money.
gold is beautiful and humans love beauty.[/quote]
Gold is garbage, and Humans love Garbage.
Gold is no more valuable then any other material.
Suppose a large gold strike is made. Gold becomes worthless.January 9, 2011 at 7:47 PM #651195Participant[quote=walterwhite]all monetary units are social constructs.
gold is the only monetary unit that will never completely fail.
all other money will someday not exist.
oil and wheat aren’t money. theya re stuff you buy with money.
gold is beautiful and humans love beauty.[/quote]
Gold is garbage, and Humans love Garbage.
Gold is no more valuable then any other material.
Suppose a large gold strike is made. Gold becomes worthless.January 9, 2011 at 7:47 PM #650869Participant[quote=walterwhite]all monetary units are social constructs.
gold is the only monetary unit that will never completely fail.
all other money will someday not exist.
oil and wheat aren’t money. theya re stuff you buy with money.
gold is beautiful and humans love beauty.[/quote]
Gold is garbage, and Humans love Garbage.
Gold is no more valuable then any other material.
Suppose a large gold strike is made. Gold becomes worthless.January 9, 2011 at 7:47 PM #650734Participant[quote=walterwhite]all monetary units are social constructs.
gold is the only monetary unit that will never completely fail.
all other money will someday not exist.
oil and wheat aren’t money. theya re stuff you buy with money.
gold is beautiful and humans love beauty.[/quote]
Gold is garbage, and Humans love Garbage.
Gold is no more valuable then any other material.
Suppose a large gold strike is made. Gold becomes worthless. -
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