50 Billion dollars to GM is not real money

A weak voice from the past.

A lesson from the past to be re-learned. It's difficult to predict when this fiat system will crash and burn, but burn it will. We or more likely our children will pay a very dear price.

Your narratives are somewhat weak in research. China and Japan are the U.S. government's biggest creditors. China is losing faith on our repayment ability and buying heavily in our infrastructure and investing in our commoditiy market currently. That is a bigger danger of a foreign country owning the U.S. literally.

I won't even go into the why's of not using the gold backed currency. There is no relationship between gold coinage availability and gold backed currency as you imply.

The purpose of printing currency is to protect spoiled Americans in seeing the dark side of capitialism. Its primarily politically motivated. The down side, if left to its normal run of things, is much more painful. But, in doing so, extends the pain for a long time to repay this debt. The assumption is that the economy will improve to the point that incoming taxes from that revenue will ease that payment pain as well. That is what Congress and Obama are betting on. I have my own personal doubts on this plan.

This will eventually mean higher prices in the US and devaluation of the dollar. The dollar is used a lot in other countries and the dollars will eventually be used less outside the US and they will then come back to the US and the prices will go up on everything. Just like th e US exported bad loans and caused problems all over the world then the weak dollar will cause problems too. How soon this will happen is not clear and the problem in many countries is that the dollar is better than their own currency but that may soon change. The price of gold is always a good indication of the excess printing of dollars. The amount of fake dollars is also great. The chinese have the biggest surplus of dollars. They own more dollars than the US. The chinese have already started to change away from dollars. The OPEC is also trying to get away from selling oil for dollars. The future of the dollar is bleak just because there are just too many of them.

you are paying it now and on and on .... no matter you say it money or not, the 50 billion can discharge debts, and the receiver can consumer, that is inflation. the vicious cheating economist said it is "deflation" in hand, just because such money had not yet been put to market.

labatyd ´£¨ì:

inflation, deflation and stagnation are all very bad if they become too dominant. Of the three then a mild inflation is the least evil.

The house prices were completely ridiculous so they have had to come down and in many cases still do so there is deflation.

The prices of many types of cars were also way too high so those prices do need to come down.

The overproduction and excesses in many goods production will cause stagnation of production of many things.

The overprinting of money is trying to correct some of these but overshooting the mark so completely that the end result will be hyper inflation.

The shear amount of dollars that have been printed to finance wars all over the world and buy friends will come back to haunt the US

Nixon took the US off the gold standard in 1971 (not 1934).

Reason being that there just wasn't, and would never be again, enough physical gold to back the entire circulating US paper money supply.

The US Congress is supposed to ask for an annual audit of the gov'ts gold reserves, but I believe it has renegged on that responsibility for some years now (some say the last real audit happened in the 1950's).

Which US dept is actually the custodian of the supply has been questioned. Some say the US Mint, others say the Federal Treasury.

If all of the other major world currencies are also not backed by a precious commodity, and if they too start printing their money at the rate that the US is, then their relative change in value would not be altered, hence there would be no real change in their buying power.

There is one peculiarity regarding the US dollar that always gives it more value compared to other currencies - that being the fact that so many commodities are traded in terms of US dollars - which means many items are bought and sold in US dollars - regardless where the transaction happens in the world. That means there is always some artificial demand for US dollars unlike any other currency. There is increasing speculation that could change. For example, Iran is now, I believe, accepting payment for oil in Euros instead of US dollars.

What an utterly stupid thing to say and do.

The amount of paper money has nothing to do with the amount of gold other than the more paper you print the more of it you need to split on a finite asset.

That is called inflation and whether you tie the dollars or not does not change the behavior of the inflation.

The US will soon experience hyperinflation like Zimbabwe.

You already got a blacky in the white house just like Zimbabwe and you are nationalizing the companies just like Zimbabwe and you have printed paper money like crazy just like Zimbabwe so just sit back and enjoy.

Zimbabwe hyperinflation approached post Second World War Hungary's hyperinflation (Hungary: 12.95 quadrillion percent per month (195% daily), i.e. prices doubling every 15.6 hours. Zimbabwe: 79.6 billion percent per month (98.0%), ie. prices doubling every 24.7 hours). On

16 January 2009, Zimbabwe issued a ZWD100 trillion bill.

I think you mean that the more paper money you print, the higher the value you must place on a finite quantity of gold reserves make the two of them equate each other. So the market price of gold must rise if more money is printed (unless more gold is mined and enters the market).

That would be fine if gold had no commercial or industrial purpose, but business and industry needs gold because of it's physical properties (ie not just to make jewellery).

And you will also notice that Roosevelt confiscated most privately-owned gold in 1933 as part of building up the US gold reserve. Are you in favor of doing that again - as part of restoring the US dollar to being backed by gold?

One Zimbabwe dollar (or what-ever it's called) is always worth one Zimbabwe dollar.

If one Zimbabwe dollar was worth one US dollar a week ago, but it's only worth 0.5 US dollars today, then that's bad (if you need to buy something that's only sold in US dollars).

What if 1 US dollar is worth 1 X dollar today, but it's only worth 0.5 X in one year?

Now you tell me what X is (ie which currency). Will X be Yen? Will it be Euros? Will it be Pounds? Will it be Rubles?

Ask youself how a US citizen / consumer is impacted when 1 US dollar went from being equal to 1 Euro to being 0.75 Euros?

If Zimbabwe needs something from some other country (oil, food, etc) then it must buy it, and it must therefore have a strong and stable currency to do so. Currency markets will take the health and stability of Zimbabwe's economy and fiscal policiy into account when valuing it's currency.

If the US needs something from some other country, it can always resort to sending it's military to get it. So world currency markets will take the strength of the US military into account (among other things) when putting a value on the US dollar.

The big mac index is ok instead of the gold index

It is not very long ago since big mac in the US was less than $1 and soon it will cost several more dollares.

That can teach a lot about inflation.

Same big mac and ever more paper to get it.

All gold is really good for is low resistance electrical connections. And perhaps Arthritis cures. Virtually all other uses are incosequential - the value of gold and diamonds are both only in the "eye" of man.

You do know that both copper and silver are more conductive than gold? The value in gold for connector terminals is its resistance to corrosion

- i.e., though it may be inferior to copper and silver in its bulk resistivity, over time, it may pass the electrons (current) better if the others (copper and silver) were to start getting surface corrosion over time, and depending of the environment in which they operate.

Of course due to cost, more conductive or physically stronger materials are often plated (vacuum deposited) with gold - so you get the best of both worlds: Extremely thin external coating (higher resistivity, but extremely thin, so the resistance is minimized) with better-conducting (or physically stronger) material, protected from surface oxidation by the coating of gold, as a substrate.

Before anyone wants to argue this (many people believe the myth due to jumping to conclusions based on the fact that gold is used on the better electrical terminals, and will almost violently defend the myth), you'd be wise to look up the conductivity (or the inverse: resistivity) numbers on various metals. It's silver, copper, gold, aluminum in increasing order of resistivity (decreasing order of conductivity). What the hey - I'll save you the trouble:

:)

From what I can tell, the Big Mac was created in 1968 and cost 49 cents at the time. Best historical data I can find says it cost $2.50 in 2000 and $2.71 in 2003. Current price is variable, about $3.60 +/- 15 cents.

A constant 5% inflation rate per year would take a 49 cent big mac in

1968 and make it worth $3.62 in 2009. It would be worth $2.33 in 2000 and $2.70 in 2003.

It would have crossed the $1 point in 1982 / 1983 (about 26 years ago).

And people are also earning more paper today compared to 1983.

And paying proportionally higher taxes. Inflation is not so bad for the young but murder for older persons, retirees, savers and those on fixed incomes.

Oh yeah. Guess what? The proportion of older people and retirees is growing rapidly. They are about to get fleeced. And the young people will pay even higher taxes than the old ones ever did. Even mild 2% inflation can put a lot of people in the poor house if you live to a ripe old age. The trick is to die young.

Please do. Why do we need a fiat currency? It's track record since 1913 isn't spectacular. If it's do better in the next 100 years it best start happening soon.

And about time. Or did you think you could elect (and re-elect) a so-called republican president who spent a trillion dollars on a "war" and not expect to have to pay for it?

Unless you haven't noticed, inflation doesn't currently exist, and hasn't for the past few years.

They fleeced themselves. They thought it was a good idea to vote for a good-ol'boy named Bush. They were so stupid they voted for him twice. Spend spend spend and not raise a single tax. Better yet - cut taxes on the rich. Signed all the bills that Congress put in front of him. The pork was just bleeding out of him. So much for the Uniter that was not a Divider. What else could the new conglomerate ExxonMobile love better? A pseudo-texan-oilman in the Whitehouse, ready to veto any attempt at winfall profits tax when the need arose.

That's what you get when you go to war.

War on drugs(tm). War on Terror(tm).

War on logic and common sense is more like it.

The trick is to not be an American or live in the US.

There's a country just to the north that is watching you melt down.

First off I'm not an American. I didn't elect your republican president nor your democratic president. From this view point one can't see any detectable difference between the two.

Depends how you measure. That's the deceptice part with their stupid statistics. It's not possible to an accurate measurement. No two people are the same. Their purchases may be similar in some areas, different than others. The economy is far too complex. Measurements are generally done selectively and mostly by gov't so you can bet your shrinking dollar they will put a spin on the numbers.

What you say is true. Of all administrations. Points out the major defect of a democratic society. It will eventually self destruct.

War. War. War. Perfectly true. That's what gov't is all about. Gov't is always at odds with the governed.

Perhaps you can list a country that ISN'T following the same path? AFAIK, all are progressing at similar speeds, slower, then faster, then slwoer again but allin teh same direction.

While you watch the country to the north also melt down.

"Democracy is two wolves and a lamb voting on what to have for lunch. Liberty is a well-armed lamb contesting the vote."

"When the people find that they can vote themselves money, that will herald the end of the republic."

Benjamin Franklin

Being "well-armed" might have given you liberty in Franklin's time.

Today, a gun isin't going to help you when the agent of your destruction and turmoil is a letter from the IRS or a bank, and NOT a minute-man dressed in a quaint uniform carrying a musket.

The pro-gun lobby doesn't seem to understand that.