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The Threat To The Dollar As The World’s Primary Reserve Currency
Submitted by Patrick Barron via Mises Canada blog,
(Following is the text of a speech given today at Drake University at the annual convention of the Iowa Association of Political Scientists.)
The Threat to the Dollar as the World’s Premier Reserve Currency
…but does it really matter?
My answer is that, “Yes”, it really matters. And that is why we need to take action today to protect all of our interests. The source of the threat may surprise you.
We refer to the dollar as a “reserve currency” when referring to its use by other countries when settling their international trade accounts. For example, if Canada buys goods from China, China may prefer to be paid in US dollars rather than Canadian dollars. The US dollar is the more “marketable” money internationally, meaning that most countries will accept it in payment, so China can use its dollars to buy goods from other countries, not solely the US. Such might not be the case with the Canadian dollar, and China would have to hold its Canadian dollars until it found something to buy from Canada. Multiply this scenario by all the countries of the world who print their own money and one can see that without a currency accepted widely in the world, international trade would slow down and become more expensive. Its effect would be similar to that of erecting trade barriers, such as the infamous Smoot-Hawley Tariff of 1930 that contributed to the Great Depression. There are many who draw a link between the collapse of international trade and war. The great French economist Frederic Bastiat said that “when goods do not cross borders, soldiers will.” No nation can achieve a decent standard of living with a completely autarkic economy, meaning completely self-sufficient in all things. If it cannot trade for the goods that it needs, it feels forced to invade its neighbors to steal them. Thus, a near universally accepted currency is as vital to world peace as it is to world prosperity.
However, the foundation from which the term “reserve currency” originated no longer exists. Originally the term “reserve” referred to the promise that the currency was backed by and could be redeemed for a commodity, usually gold, at a promised exchange ratio. The first truly global reserve currency was the British Pound Sterling. Because the Pound was “good as gold”, many countries found it more convenient to hold Pounds rather than gold itself during the age of the gold standard. The world’s great trading nations settled their trade in gold, but they might accept Pounds rather than gold, with the confidence that the Bank of England would hand over the gold at a fixed exchange rate upon presentment. Toward the end of World War II the US dollar was given this status by treaty following the Bretton Woods Agreement. The US accumulated the lion’s share of the world’s gold as the “arsenal of democracy” for the allies even before we entered the war. (The US still owns more gold than any other country by a wide margin, with 8,133.5 tonnes to number two Germany with 3,384.2 tonnes.) The International Monetary Fund (IMF) was formed with the express purpose of monitoring the Federal Reserve’s commitment to Bretton Woods by ensuring that the Fed did not inflate the dollar and stood ready to exchange dollars for gold at $35 per ounce. Thusly, countries had confidence that their dollars held for trading purposes were as “good as gold”, as had been the British Pound at one time.
However, the Fed did not maintain its commitment to the Bretton Woods Agreement and the IMF did not attempt to force it to hold enough gold to honor all its outstanding currency in gold at $35 per ounce. During the 1960’s the US funded the War in Vietnam and President Lyndon Johnson’s War on Poverty with printed money. The volume of outstanding dollars exceeded the US’s store of gold at $35 per ounce. The Fed was called to account in the late 1960s first by the Bank of France and then by others. Central banks around the world, who had been content to hold dollars instead of gold, grew concerned that the US had sufficient gold reserves to honor its redemption promise. During the 1960’s the run on the Fed, led by France, caused the US’s gold stock to shrink dramatically from over 20,000 tons in 1958 to just over 8,000 tons in 1970. At the accelerating rate that these redemptions were occurring, the US had no choice but to revalue the dollar at some higher exchange rate or abrogate its responsibilities to honor dollars for gold entirely. To its everlasting shame, the US chose the latter and “went off the gold standard” in September 1971. (I have calculated that in 1971 the US would have needed to devalue the dollar from $35 per ounce to $400 per ounce in order to have sufficient gold stock to redeem all its currency for gold.) Nevertheless, the dollar was still held by the great trading nations, because it still performed the useful function of settling international trading accounts. There was no other currency that could match the dollar, despite the fact that it was “delinked” from gold.
There are two characteristics of a currency that make it useful in international trade: one, it is issued by a large trading nation itself, and, two, the currency holds its value over time. These two factors create a demand for holding a currency in reserve. Although the dollar was being inflated by the Fed, thusly losing its value vis a vis other commodities over time, there was no real competition. The German Deutschemark held its value better, but the German economy and its trade was a fraction that of the US, meaning that holders of marks would find less to buy in Germany than holders of dollars would find in the US. So demand for the mark was lower than demand for the dollar. Of course, psychological factors entered the demand for dollars, too, since the US was the military protector of all the Western nations against the communist countries.
Today we are seeing the beginnings of a change. The Fed has been inflating the dollar massively, reducing its purchasing power and creating an opportunity for the world’s great trading nations to use other, better monies. This is important, because a loss of demand for holding the US dollar as a reserve currency would mean that trillions of dollars held overseas could flow back into the US, causing either inflation, recession, or both. For example, the US dollar global share of central bank holdings currently is sixty-two percent, mostly in the form of US Treasury debt. (Central banks hold interest bearing Treasury debt rather than the dollars themselves.) Foreign holdings of US debt currently total $6.154 trillion. Compare this to the US monetary base of $3.839 trillion.
Should foreign demand to hold US dollar denominated assets diminish, the Treasury could fund their redemption in only three ways. One, the US could increase taxes in order to redeem its foreign held debt. Two, it could raise interest rates to refinance its foreign held debt. Or, three, it could simply print money. Of course, it could use all three in varying amounts. If the US refused to raise taxes or increase the interest rate and relied upon money printing (the most likely scenario, barring a complete repudiation of Keynesian doctrine and an embrace of Austrian economics), the monetary base would rise by the amount of the redemptions. For example, should demand to hold US dollar denominated assets fall by fifty percent ($3.077 trillion) the US monetary base would increase by eighty percent, which undoubtedly would lead to very high price inflation and dramatically hurt us here at home. Our standard of living is at stake here.
So we see that it is in America’s interest that the dollar remain in high demand around the world as a unit of trade settlement in order to prevent price inflation and to prevent American business from being saddled with increased costs that would derive from being forced to settle their import/export accounts in a currency other than the dollar.
The causes of this threat to the dollar as a reserve currency are the policies of the Fed itself. There is no conspiracy to “attack” the dollar by other countries, in my opinion. There is, however, a rising realization by the rest of the world that the US is weakening the dollar through its ZIRP and QE programs. Consequently, other countries are aware that they may need to seek a better means of settling world trade accounts than using the US dollar. One factor that has helped the dollar retain its reserve currency demand in the short run, despite the Fed’s inflationist policies, is that the other currencies have been inflated, too. For example, Japan has inflated the yen to a greater extent than the dollar in its foolish attempt to revive its stagnant economy by cheapening its currency. Now even the European Central Bank will proceed with a form of QE, apparently despite Germany’s objections. All the world’s central banks seem to subscribe to the fallacious belief that increasing the money supply will bring prosperity without the threat of inflation. This defies economic law and economic reality. They cannot print their way to recovery or prosperity. Increasing the money supply does not and cannot ever create prosperity for all. What is more, this mistaken belief compounds a second mistake; i.e., that savings is not the foundation of prosperity, but rather spending is the key. This mistake puts the cart before the horse.
A third mistake is believing that driving their currencies’ exchange rate lower vis a vis other currencies will lead to an export driven recovery or some mysteriously generated shot in the arm that will lead to a sustainable recovery. Such is not the case. Without delving too deeply into Austrian economic and capital theory, just let me point out that money printing disrupts the structure of production by fraudulently changing the “price discovery process” of capitalism. Capital is allocated to projects that will never be profitably completed. Bubbles get created and collapse and businesses are suddenly damaged en mass, thus, destroying scarce capital.
Because of this money-printing philosophy the dollar is very susceptible to losing its vaunted reserve currency position to the first major trading country that stops inflating its currency. There is evidence that China understands what is at stake; it has increased its gold holdings and has instituted controls to prevent gold from leaving China. Should the world’s second largest economy and one of the world’s greatest trading nations tie its currency to gold, demand for the yuan would increase and demand for the dollar would decrease overnight.
Or, the long festering crisis in Europe may drive Germany to leave the eurozone and reinstate the Deutschmark. I have long advocated that Germany do just this, which undoubtedly would reveal the rot embodied in the Euro, the commonly held currency that has been plundered by half the nations of the continent to finance their unsustainable welfare states. The European continent outside the UK could become a mostly Deutschmark zone, and the mark might eventually supplant the dollar as the world’s premier reserve currency.
The underlying problem, though, lies in the ability of all central banks to print fiat money; i.e., money that is backed by nothing other than the coercive power of the state via its legal tender laws. Central banks are really little more than legal counterfeiters of their own currencies. The pressure to print money comes from the political establishment that desires both warfare and welfare. Both are strictly capital consumption activities; they are not “investments” that can pay a return. In a sound money environment, where the money supply cannot be inflated, the true nature of warfare and welfare spending is revealed, providing a natural check on the amount of funds a society is willing to devote to each. But in a fiat money environment both war and welfare spending can expand unchecked in the short run, because their adverse consequences are felt later and the link between consumptive spending and its harm to the economy is poorly understood. Thus, both can be expanded beyond the recuperative and sustainable powers of the economy.
The best antidote is to abolish central banks altogether and allow private institutions to engage in money production subject only to normal commercial law. Sound money would be backed one hundred percent by commodities of intrinsic value–gold, silver, etc. Any money producer issuing money certificates or book entry accounts (checking accounts) in excess of their promised exchange ratio to the underlying commodity would be guilty of fraud and punished as such by both the commercial and criminal law, just as we currently punish counterfeiters. Legal tender laws, which prohibit the use of any currency other than the one endorsed by the state, would be abolished and competing currencies would be encouraged. The market would discover the better monies and drive out less marketable ones; i.e., better monies would drive out the bad or less-good monies.
We need to look at the concept of a reserve currency differently, because it is important. We need to look at it as a privilege and a responsibility and not as a weapon we can use against the rest of the world. If we abolish, or even lessen, legal tender laws and allow the process of price discovery to reveal the best sound money, if we allow our US dollar to become the best money it can - a truly sound money - then the chances of our personal and collective prosperity are greatly enhanced.
We all have the same interest. We all want to have the highest standard of living for ourselves and our families. A sound money reserve currency offers us the best chance of achieving our shared goal; therefore, we should rally around every effort to make it so.
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I tried to give my monkey bitcoin, but he still wanted a banana
"Subjective value .... with intrinsic overtones .... and a hint of oak and pepper .... and some earthiness !" Leftist Wine Review
Those practicing the Vow of Sallekhana have no use for food.
http://en.wikipedia.org/wiki/Sallekhana
Similarly, those who have lost the desire to live may voluntarily give up access to water or air. Face the truth: All value is subjective.
Socialism depends on people who can't handle the truth !
Dozens / hundreds of contenders have challenged gold and silver's status as money over thousands of years. Sea shells, grain, cattle and many others. And now digital currencies.
All have failed.
All digital currencies can be hacked, however difficult it may be. They were, after all, originally created from nothing. Gold must be found, mined and sweated out of the Earth. No conjuring allowed.
Fiat currencies - of which digital currencies are one - are created daily at will.
"What is gold worth to a dog or a monkey ?"
The same value as shitcoin. But how much is that dog or monkey worth if it had a gold chain around it's neck vs some fake bitcoin blockchain code printed on it's neck ?
Tell ya what. Take a trip to Africa. Check out some of the locals branding gold pans or better yet, metal detectors, and their search for gold to buy FOOD. Not one entity over there would trade food for a bitcoin. NOT ONE.
The problem these days is the value of WORK is being circumvented by the value of FAKE.
your dog could have far more in bitcoin around it's kneck than gold.
4 billion of the world's unbanked will have internet access on a smartphone within the next decade. Many of them African. Bitcoin is as easy to use as making a telephone call. Sorry to tell ya but gold is a relik.
bitcoin requires technology to trade. there is an infrastructure, without it, there is no trade. a currency must be liquid without the lights on. have you ever walked outside in your life? can you even admit that the required infrastructure for bitcoin is too vulnerable to disruption, physically, to make it a real choice?
why did you use a computer to post that reply?
don't you recognize that a computer requires electricity and infrastructure, and therefore it's too vulnerable to make it a real choice?
this computer is a distraction, a novelty, not the source of my existance in meatspace. if the lights go off i will be denied reading snarky comments, not my ability to trade.
are you suggesting that bitcoin is the source of anyone's existence?
or that if the lights go off, there will be no other options for trade?
you're using a computer because it happens to be working at the moment. why should it be any different for bitcoin?
does it logically make sense to suggest that because something might break someday, that we shouldn't use it?
read into it what you will. electronic currency is not robust in a brownout, post hurricane, whatever. currency is not required just when convenient. use the heck out of it now, but tapping your i-thing on the counter when the power is out is not going to get your family food. it doesn't work with dollars either, but at least i have physical option to use as payment. can you at least admit that much?
Within the next decade ? Sorry to tell you this, but your time on Earth is not certain. TODAY they use GOLD.
No , today they use fiat currency. Tomorrow they will be using bitcoin.
I wonder how these great unwashed masses are going to pay for their smartphone in the first place? They probably will have to scrounge up something physical...
Gold is worthless to a dog or a monkey, agreed.
To people, however, it is worth quite a bit. You can exchange an ounce of it for $1,200 or so, or for a quantity of bitcoins (which you have already said you value), or for a wide array of goods and services.
Gold and bitcoin are complementary. Gold has value. However bitcoin is far superior as a currency.
"Gold has value".
I just love schizophrenic trolls!
Where did I say gold did not have value ?
jesus fuck sake, u serious ? give us a break.
Go and buy some more hollowpoints. You will need them in the collapse.
Actually it would have been useful to get wealth quickly across National borders.. Especially for this guy, then buy gold ( cuz it has value) on the other side..
http://www.dailymail.co.uk/wires/afp/article-2982779/Bangladesh-seizes-2...
More than bitcoin
51% of Bitcoin's hashing power and therefore control lies with just 4 people.
https://blockchain.info/pools
They also have secret meetings, Jekyll Island style.
http://www.coindesk.com/bitcoin-elite-meet-secret-island-bilderberg-styl...
It's almost a guarantee that Bitcoin is already subverted. More importantly retailers can't hold it due to volatility and exchange immediately for fiat so in addition to its high inflation this creates constant selling pressure, putting Bitcoin on a longterm downtrend the more utility it gains. Though in the event of widespread bail-ins I still suspect it will do well.
My favourite is BitShares the no.4 cryptocurrency by CAP who have stable BitAssets like BitUSD which has successfully pegged to USD for over 7 months since inception as well as BitGold and BitSilver which can be especially useful for transferring wealth across borders without carrying physical. Still early days though.
Of course nothing compares to physical gold and silver.
your post is terribly misleading and uninformed - i don't know if you're purposely trolling or not.
first point, pools are not "people", so for you to say that 51% of bitcoin's hashing is controlled by 4 people is plainly false.
second point: the coindesk article you linked to was total rubbish, i saw it when it came out last month. the writer, pete rizzo, is an ignoramus who often writes sensationalist crap to try to get attention, there is nothing useful or informative about him. there is nothing "bilderberg" about the meeting, nor is there any such thing as "bitcoin elite". several of those metioned attending the meeting are libertarians / anarchists, and oppose government controls of everything, unlike the bilderbergers referenced. if there were a gold-related conference, and people like eric sprott, david morgan, rick rule, etc, showed up, would you think it would be reasonable to say it's the bilderberg conference of gold, and the gold-elite showed up?
"It's almost a guarantee that Bitcoin is already subverted." - prove it. explain how it is subverted, and by whom. is this conjecture, or do you have some evidence? any more than you can say that gold is subverted, because of the comex paper pricing fraud going on?
"Of course nothing compares to physical gold and silver." - depends for what. gold is great as a store of value. bitcoin is great for moving wealth through national borders and avoiding capital controls. they serve different functions. use the right tool for the right job.
The Pool owners are in control of the hashing power that is currently directed at their pools. 4 colluding pool owners could temporarily bring down Bitcoin and in the past a single pool like Ghash.io has got as high as 51% control. So you are constantly at the mercy of a handful of people. This is incredibly centralised and was not the original intention of Satoshi.
Bitcoin could recover but it's value would be decimated by a 51% attack and 4 pool owners can be easily targetted. So you are more at the mercy of the TPTB with Bitcoin then anything I've come across.
Bitcoin is very centralised via the pools, the chip manufacturers, early Bitcoin adopters as well as a few key exchanges and web wallets.
This level of centralisation makes it easily targetable and controllable, bringing all those power players together in a single 50 max invite only meeting makes it even more so. You now have to 'trust' the intentions of that group which defeats the purpose of crypto-currency.
Regardless Bitcoin's volatility makes it non-viable anyway. Imagine everytime you paid for anything in USD the retailer or business exchanged it immediately for Yen. This is what happens with Bitcoin because of the tight margins retailers work on. This creates constant selling pressure which is easily apparent looking at the long term graph of Bitcoin. (There is an occasional short term positive catalyst but the trend for the last 15 months is clearly down despite record investment, media exposure, adoption and retailer acceptance - currently accepted by > 100 000 retailers.)
You missed the point entirely. Pools are made up of thousands of individual miners spread across the planet , who can instantly switch to another pool or go solo if the pool operator is a bad actor.
Except those individual miners don't switch all the way up to Ghash.io getting 51% control. Ghash actually had to stop accepting miners that's how bad it was and how reluctant miners are too switch from the strongest pool. Those individual miners are getting larger and more centralised too.
In the short term for hours or days they could bring down Bitcoin, double spend etc. etc. The power to do this at the most opportune time is invaluable for TPTB and will decimate Bitcoin's value and destroy trust short term.
" Regardless Bitcoin's volatility makes it non-viable anyway."
how so? explain. bitcoin is volatile, but that doesn't reduce viability. bitcoin is viable and is used every day.
as a merchant, i prefer bitcoin, because it saves me 2-3% on credit card fees, and 100% eliminates chargebacks and fraud. that gives a great deal of value, especially in low-margin areas like you mention. and it allows me to offer better prices, which gives value to the customer.
as far as bitcoin 'power players" or "elite", i don't really care what they do. they don't have an incentive to wreck bitcoin, and if they did, i'd stop using it. pretty simple, no?
Yes you save 2-3% so you accept Bitcoin but you don't hold it because you work on extremely tight margins. This means a sale in Bitcoin is a sale of Bitcoin. People like you think more businesses accepting Bitcoin is good but if they don't hold it, it's bad as they create Bitcoin selling pressure which isn't offset with Bitcoin demand.
Regards 'power players' - As you say those few people don't have the incentive but TPTB do and the power players are easily targetable. The fact that you have to trust that a small group doesn't have the incentive to damage you defeats the whole point of crypto-currency which is that you shouldn't have to trust any small (targettable) group.
a sale of bitcoin is also a purchase of bitcoin. don't forget that every transaction has both buyer and seller. where will the customer get the bitcoin to buy stuff with? he has to buy bitcoin first.
but, let's even set that issue aside. why does it even matter if the bitcoin price goes up or down? bitcoin is just as effective a transaction tool at $1 as it is at $1000.
a falling bitcoin price shouldn't concern anyone, unless they own a considerable amount of bitcoins. i wouldn't recommend trying to hold bitcoins as a store of wealth; that's what gold is for.
"The fact that you have to trust that a small group doesn't have the incentive to damage you defeats the whole point of crypto-currency"
that's the whole thing - i don't have to trust anything or anyone. right now it works, so i use it. and the so-called "power players" just don't have the motivation to destroy that which they've invested so heavily in.
Yes for every sell there was initially a buy but a large part of Bitcoin holders & 'buyers' are made up of early adopters, investors, speculators and earners. When they spend Bitcoin they are not 'necessarily' replenishing their position so if the vast majority of Bitcoin retailers aren't holding Bitcoin you get a situation where increased utility creates net BTC selling pressure.
If the retailers held BTC more, Bitcoin would grow in value. This is why I'm a fan of BitUSD by BitShares as retailers can hold and manage their expenses without worrying about Crypto volatility. (It also pays a 1.72% yield currently which is pretty good - https://bitsharesblocks.com/assets/market )
With the rest of the points you're now making the argument that Bitcoin is just an effective transaction tool that you wouldn't trust to hold or gain value for a long period. This is true. I'm hoping more decentrised, faster solutions with stable currency and commodity options solve the problem and reverse the crypto downtrend.
Nothing beats phyzz though.
as i've said: phyzz is great as a store of value.
bitcoin is great as a transaction system.
use the right tool for the right job, it's not one vs the other.
No digital currency will ever usurp gold's place as money par excellence.
Why? Because digital currencies don't meet all of the requirements of an acceptable medium of exchanged outlined by Alan Greenspan in his classic Gold and Economic Freedom essay.
If you haven't already read it, it's available online for free. If you have read it, I suggest re-reading it to understand why bitcoin and other digital currencies will never meet all the criteria necessary for the ideal form of money.
gold, is great, and i'm 100% pro-gold.
but people who try to compare gold with bitcoin are missing the boat.
don't create a false dichotomy, it's not either-or, they each have their own purposes, things they are good for and things they aren't good for.
Bitcoin and other digital currencies are clearly competitors to gold. It's unclear how they'll fare against the dollar or other fiat currencies, which have a spotty record. Time will tell. However, digital currencies pale when compared to gold, which during thousands of years of use as money has never been worth zero. Fiat currencies can't make that claim.
BORDERS see my post above on seizing gold at borders.. BITCOIN for BORDERS.... That is its primary usefulness
Hey, idiot...gold is tangible bitcoin doesn't exist in the universe physically but in computer digit.
"Bitcoin is far superior as a global currency.
What is to stop one million people from creating a digital currency like bitcoin - or better - and thus diluting the value of bitcoin to one millionth of the value it would have had.
anyone can create an alt-currency, sure, and many people have.
however, bitcoin has an important first-mover advantage, there has been a lot of infrastructure and investment around bitcoin. the altcoins? not so much.
and if someone does by some chance come along with an alt-coin that is such a big improvement on bitcoin that it replaces bitcoin? hey, i'm all for it!
LOL! Evasive ...
I am obviously talking about that time in the not too distant future when the infrastructure exists to support multiple digital currencies, which is inevitable - more inevitable than Bitcoin remainig the top digital currency, and certainly more inevitable than bitcoin becoming the global reserve currency through market process.
On a related note, if bitcoin did achieve the impossible and become the global reserve currency, then that could only mean the owners of the Fed and other assorted leaders of the NWO made it happen.
I didn't down vote you, BTW.
evasive? how? i directly addressed what you wrote.
there already are dozens, if not hundreds of digital currencies, here's some of them:
http://altcoins.com/
what i was saying about infrastructure, is investments in the $100s of millions is being put into bitcoin, pretty much none of it being invested in alt-coins. things like bitcoin ATMs, exchanges, service companies, etc.
network-effect / first-mover advantage is huge.
i don't support any global reserve currency, not for bitcoin, not for anything else. i believe in having a plethora of options, and letting the free market decide what we want to use and what we want to value.
"What is to stop one million people from creating a digital currency like bitcoin" ?
Is the same as:
"What is to stop one million people from creating another internet like the internet"
Network Effect.
I beg to differ. The Gold Standard Society is building a decentralized digital gold system that enables:
* Instant Worldwide Value Transfer
* Minimal storage costs (by using bullion dealers as issuers - storage is part of their existing overhead)
* Minimal transport costs (gold is already moved around in the private industry)
* Full reserve auditing
* Micropayments (fractions of a cent)
What the GSS system will do that Bitcoin cannot do includes:
* Near real-time clearing (100 milliseconds)
* Stable transmission of value over both time and space (Bitcoin's volatility makes it horrible for transmitting value over time)
* Physical to digital exchange (Bitcoin has no tangible reality so you can't withdraw)
Check out the Gold Standard Society. Anyone can join. Together we are building the next generation gold payment system.
https://goldstandard.io
very cool!
i just saw this a few days ago, someone had posted it on the dollar vigilante site.
Good luck to them , I wish them all the best. However it sounds like a centralised system which would be wide open to government abuse. But good luck to them anyway.
What if there's no electricity, or internet access?
crazytecnician: >>> Bitcoin is far superior as a global currency.
Please tell me how Bitcoin would work if it were banned from the internet? Or if indeed there were no internet as we know it?
How the fuck can you ban something from the Internet ? Bitcoin is a protocol not a web site. And if there was no internet we would have much larger problems than worrying about bitcoin.
What's going to back bitcoin? How will you redeem your digital currency and with what? What happens if there was an emergency and the power goes out? At least with paper debt there's the soveriegn government and it's army to backup their fiats by going to war. What about bitcoin?
What backs gold ? OMG - reading that I don't even know where to start with you.
We are living in a world where the most anti-establishment media and its audience cannot comprehend bitcoin.
This is the true reason for the fucked up situation and not jews, bankers or greedy politicians.
The people deserve this whole clusterfuck. ;)
I bet ya a dozen clever kids can crack bitcoin and make it a very profitable game, if haven't been done already.
"threat"...lessee ..why do I get the feeling that the same people seeing this as a "threat" probably also see "climate change/glowbull warming" as a "threat"
Change happens. Deal with it. The most flexible and adaptable survive. Those that want to sit around and have an argument with nature/God are only gonna get steamrollered by something even much bigger than themselves, or even their egos!!
You can't replace paper with paper. And sorry to the bitcoin folks, if you want to buy produce(citrus and avocados) from my land then I want silver or gold, or solid barter trade.
paper will probably be replaced by paper. wouldn't surprise me to see RMB or a BRICS currency that is partially or fully backed by gold in the near future, though.
it's easy enough to buy silver online with bitcoin. businesses tend to do better when they offer customers more payment options.
It's not that damned complicated. To force sovereign nations to purchase any one currency before they can trade goods and services with others is immoral. Period.
Gold holders, I am happy for you personally, but not for my country. Most of the gold has flowed east.
What about considering the majority of our people?
You want third world?
https://realcurrencies.wordpress.com/2014/08/20/the-brics-bank-next-stop...
We need a plan B, the greenback.
Our people are our strength.
Yes, we are hurting, but not defeated, yet.
Let's make sure that does not happen.
The BRICS gold standard will NOT save us.
We need to turn inward and fix our home.
On money creation, I prefer a quasi revolving board from all walks of life, transparent on the net to all. End the Fed.
End Rentier Capitalism too.
Beyond left and right :
http://www.henrygeorge.org/isms.htm
http://schalkenbach.org/on-line-library/works-by-robert-v-andelson/henry...
Solving the "Unsolvable"
http://masongaffney.org/
Let's avoid a civil and nuclear war, shall we?
Like the good upstanding adults we are known for! ;-)
"We need to turn inward and fix our home" That is probably going to require some scrapping, scrappy..
gold is no good because as the economy increases, more money must go into circulation, meaning more gold must be mined, meaning the earth must be ravaged for more gold, a useless, toxic and difficult substance to mine (for essentially no real reason).
on the other hand when the spanish hit the americas, and came home with boat loads of gold, the resulting devaluation of gold, (flooding the markets), was not that different to what central bankers are doing today with fiat.
who is to say that in 10-20 years we won't be able to mine gold from the moon, in trucksloads, until it's as common as steel....
the massive expansion in economies could be put down to lots of easy credit being available, because we are not contrained digging money out of the ground.
as martin armstrong points out, they were forging gold coins in Roman times, with MORE gold than the original roman coins required..... who would do such a stupid thing ? WHY ? because the currency even in gold is about trust not about what it's made of.
i hate bitcoin, but something like that would be more intelligent (and less damaging to the planet) than gold.
Less damaging to the planet... How about rays of sunshine or rainbows or unicorn sharts, taste like skittles but harder to catch..
"i hate bitcoin, but something like that would be more intelligent (and less damaging to the planet) than gold." ?
Every person I have spoken to who is now into bitcoin was a huge sceptic.
Once you do some research , if you understand what it is you will see it is truly revolutionary.
I am not arguing, it has its uses, but they are limited at this point both technologically and socially, even you can agree with that if your being honest..
It's only limitations at this point are human , not technical. As you can see from the FUD comments , here we have a bunch of un-informed people who due to their lack of understanding revert to attack. It is normal for people to attack what they do not understand. However there is nothing wrong with educating yourself so if you do make an attack it is informed and not the normal drivel they roll out. about ponzi schemes tulips and the government switching off the internet or the power grid to stop bitcoin.
The move, which I can't understand how or why the BRIC haven't made yet.
The move is NOT to try and replace the USD as Reserve Currency. I'll briefly describe what they need to do. They Use the USD in its Reserve Currency status, since it is how Commodity Prices are made Globally.
So, you take the Group of 77 Member Nations, and they ALL simultaneously, same Day, same Time, Hard-Peg to China's Yuan, renmimbi.
And then China ReValues their Yuan to 2 to 1 vs the USD.
This "race to the bottom" that currencies have been doing for years??? How's that worked out...? The move is to ReValue to Strengthen your currency vs the USD. That makes ALL & ANY Commodity Cheaper for you to buy and also gives both The People and Country a Higher Purchasing Power. They would also revert back to the pre-1971 manner of handling annual Balance of Payments, using gold.
There are over 130 Member Nations in the Group of 77, google it and check Members..and also think about what this Move really would do.
Forget IMF, World Bank, etc... create your own system.
It should be obvious this what they have planned, since the FIAT Printing QE'ers are the very same IMF SDR 4...and they too would have to pay in gold for Trade balances.
B-I-T-C-O-I-N
G-T-F-O
Why - because he's got a different opinion than yours?
1. Because he hijacked the thread;
2. Because babbling on the same thing 50 times doesn't make it more trustworthy.
Bitcoin, as a currency, is closely related to the subject of reserve currencies, so it's difficult to see how this guy espousing the supposed viability of it threatens the thread, whatever the merits of his argument.
On your second point, I agree he did a poor job of defending Bitcoin or digital currencies generally, despite numerous attempts to address folks' reservations.
However, I'm glad the guy's here posting and discussing this. I'm guessing others also came away with reservations about digital currencies.
I have been doing this on here since 2012. At first I tried doing a good job giving a good technical appraisal and explaining this technology , but all they understand is lakes , hollowpoints and prepper food. Now I just take the piss out of them.
the quality of the average zh poster over the 4 years i've been on this site has degraded drastically.
"we lowest-common-denominatored some folks"
The greatest threat to the $ is the empty vaults at Fort Knox and West Point.
and the fraud and corruption endemic in the western financial system.
other countries like russia, china, even germany and france, are tired of it, and of USA's bullying.
it's just sad that the american people are going to suffer horrendously, instead of the american "leadership" which betrayed them.
Ain't going to happen... to the bottom bitchez!
I came here to post just that: AIN'T GONNA HAPPEN.
If they were worried about integrity, they would have done something about it years ago.
"We need to look at the concept of a reserve currency differently, because it is important. We need to look at it as a privilege and a responsibility and not as a weapon we can use against the rest of the world"
BWAHAHAHHA!!!
Go tell Rothschild & Rockefeller that.
While you're at it, go tell Netanyahu we'd like an inventory of Israel's nukes & how much gold has been squirreled away in vaults under Rothschild Blvd. in Tel Aviv.
You people crack me up.
^
The guy that wrote this article must have been paid off, given lots of blow, or given chicks for free. He was corrupted.
It's day after day that all we get to read are articles that pussyfoot around the TRUTH...
It's all fucking 'Academia' vs. 'Reality'...
It always reminds me of this:
https://www.youtube.com/watch?v=YlVDGmjz7eM
What's worse is sitting here listening to, [& collecting 'junks' all day from], the fucking APOLOGISTS & DISINFORMATION TROLLS [one of whom felt the need to junk my comment above, because, apparently, Reality BITES]... Then ~ when you finally get thru all of that, some Dr. Ruth Westheimer wannabe jumps in and thinks they need to 'school you' on how to perform kissing orgasms, & that you oughta try therapy because you fucked up and married the wrong guy [unlike herself, whose choices have all been perfect].
Yeah, for instance he lost me at "The US still owns more gold than any other country by a wide margin..."
You need an argument that isn't an ad hominem attack. In other words, a real one.
what? rational discussion on zh? you must be new here!
Since when is it an 'attack' to publish my thoughts?... I thought 'attacks' were, like, when you dispatched drones to kill civilians because you didn't like heterosexual wedding parties.
do less "thinking". it doesn't suit you, and nothing good will come of it.
"go tell Netanyahu we'd like an inventory of Israel's nukes & how much gold has been squirreled away in vaults under Rothschild Blvd. in Tel Aviv."
Your comment reminds me of an increasingly plausible scenario: Obama starts a war with Israel, and after three days would surrender on TV and say something like, "They hacked our satellites and nukes, and held us hostage with our own nukes, and without our satellites we couldn't do jack, but that's fair since we started the war. The terms of surrender is that the global currency is now the SDR, and the US has ratified treaties ceding more authority to the UN to stop Global Warming and the proliferation of small arms. You see, Israel is so selfless it didn't even ask for anything for itself. Israel is only interested in the greater good. We are truly blessed to have a friend like Israel, and God will smile upon is as long as we support Israel."
Just to be clear, Israel would not have done anything at all, let alone anything brave or brilliant. It would all be theatre - an excuse to give even more to Israel.
They certainly wouldn't have hacked anything because the US would have given them the codes to the backdoors in all American technology. Israel probably put most of those backdoors in themselves with US approval.
It's all fun & games until someone ENDS UP IN A CONE...
Interesting ... I sided with you, but as of your reply two minutes later, I had only one vote, and it was down. This implies that you are not what appear to be. Perhaps you can explain ...
The downvote wasn't from me... [I don't use the arrows feature ~ what's the point]?
For future reference [to all], If I really like a comment I'll publish a comment right behind it and give it a [+1]... At least then, you'll know who it's coming from.
Thanks.
Were you implying that I am at risk of being censored by ZH - or worse?
BTW, how plausible did you find my scenario? How would you improve it?
@FJ
It was a copy/paste job [NOT plagarized, but I think you posted the same comment the other day if I remember ~ not that there's anything wrong with that ~ I do the same on occasion]]... I read it then too...
Anyway ~ I read it and considered it... I don't think it's an IMPLAUSIBLE hypothesis ~ [note the 'double negative' there]...
Let's hope it never comes to that, but FWIW, these politicians & puppeteers nowadays are so batshit crazy that it seems ANYTHING is on the table... Let's put it this way, if I was sipping on a drink by myself in a bar and you sat down next to me & started talking about that, I wouldn't think you were drunk or crazy...
Yes, I refined the senario and tried it out again, and I thank anyone who wants to help out with feedback.
I don't think this is the most likely scenario because nothing is most likely, as you said, at this point anything is possible. It is new though. and relevant given the current events.
I think the fact that it is plausible at all is truly amazing and pretty revealing.
I concur with that... Furthermore ~ I appreciate the thought that went into the concept... Nowadays ~ I'm willing to consider many scenarios...
Then again... There are others who propose scenarios which my 'street sense' tells me to reject without further need for debate [this thread happens to be peppered with them].
Future Jim:
I gave you an upvote b/c I found your scenario very plausible.
Downvotes can come for any reason, ranging from legit disagreement, to a stalker who don't like you, to a troll or a bot. I've even fat-fingered those votes sometimes, pushed the wrong arrow w/o noticing. You shouldn't pay much attention to your polls. They get wiped after a few weeks anyway.
(Wish they didn't but maybe it's for the best considering the gov's criminal spy network, or how easy it would be to rig them with socks a few days later.)
There is a time-honoured Hedge tradition of red arrows being a sign of honour, from the days when francis roamed free. :-)
Then again, maybe that's only for us old-timers. This new crop of young'uns, barely even notice quotes from Fight Club or The Big Lebowski anymore these days. (Which is both shocking and scandalous of course.)
@Renfield
...aaah the days!
Notwithstanding ~ TIME MARCHES ON...
Swim or drown... Generations are callous & finicky ~ but TIME is ETERNAL... I'd better copy/paste that thought [or it risks to be forgotten]... I won't bother TRADEMARKING it... ~ it's everyone's for FREE...
Brawndo, forgive this digression from thread topic but:
<<I'd better copy/paste that thought [or it risks to be forgotten]... I won't bother TRADEMARKING it... ~ it's everyone's for FREE...>>
's why I'm against 'copyright', the enemy of free thought. You either get paid for your thoughts, or you get audience... and REACH... thereby, power. (That's why "free" propaganda is so effective: audience reach.) I'll bet for every worthwhile comment on this blog, there are another 20 home-computer 'files' that immortalise it and a few people who might spread that same thought around. Copy/paste is the power of the internet. Give it away for free, you may not get paid or acknowledged, but your ideas have more power that way. Even those whose ideas get them banned or carried away in the dark of night, can revolutionise thru the power of self-publishing on today's 'printing press', the internet. (Which is why people who 'just complain on the internet' ARE in fact doing something revolutionary, which is why gov is so keen to try to assert gatekeeping control over us whiners.) We cannot be intimidated, silenced, or successfully driven away by any self-appointed internet 'gatekeepers': they will inevitably be defeated.
Sorry about the digression. Back to thread topic, World Reserve Gatekeeper, and bitcoin fight.
I concur [+1]... 100%
Reserve currency status changes. USA has debauched as much as possible. The result is the same as always. It's inevitable. At least we here get it.
Well said.
Underneath the whole article it seems like he still believes that if we just fixed a few things, we could go on with 'Growth'.
That game is over. We have hit the limits of growth. Monetary policy won't change that.
War is the one panacea. And you don't need a prescription to get it.
Except war hasn't worked for us. We've spent trillions on it with no return to speak of. Doesn't sound like a panacea to me.
it sounds like panacea to paul krugman and the keynesians.
but rational people tend to recognize the broken window fallacy:
http://mises.org/library/broken-window-fallacy
Might have spent trillions, but "they" need to stack billions of bodies that is. Read krugman just so many broken windows
War or the US economy collapses.
both.
The US economy IS collapsing, even without (?) an official shooting war. It seems a decade and a half of very war-like actions in the ME were not enough...
My answer is no it doesn't matter and all money should be eliminated. Money is relic used by cavemen and barbarians.
A healthy, sustainable economy needs three things: the rule of law, free markets, and a sound currency. Today we have none of these in the US.
You also need good products. And right now, all US products and services - Apple, Microsoft, Cisco, AT&T, MCI, Sprint, you name it, they've got it: an NSA-approved backdoor. In the short run, some spook gets a raise. In the long run, it kills business.
Buy Gold ETF
if you're going to do that, buy PHYS or CEF, your metal will be fully allocated, audited and insured.
and make sure you register your shares in YOUR name, not street name, that way you won't have to depend on your broker being solvent during the coming financial collapse.
see jim sinclair's GOTS (get out of the system) if you don't know what i'm talking about.
The Potemkin Village Gold Raid of March 6:
http://winteractionables.com/?p=19026
King Dollar just sneers at this craptacular post
i read it waiting for the punch line ... was not disappointed
"Sound money would be backed one hundred percent by commodities of intrinsic value–gold, silver, etc."
It is a fiat world, baby!
:It is a fiat world, baby!:
it is only so now (recent history post 1971 in the case of the US FRN). it wasn't in the past and won't be in the future. when fiat was the norm, disaster followed. the whole point of surthrival is adaptation. clinging to the failed ideas of the past is what dooms humanity's progress.
Even in a fiat world, they will run out of fizz Au to deliver at these prices. Currently China single handedly gobbles up ALL the Au the mines of the world produced, and probably some... Then what, B2H ? Pm prices will rise significantly. Yes, there will always be fiat and debt, but the PMs are now at bargain prices relative to the amount of fiat sloshing in the system... kinda like 96 - 01...
This is a very flawed article. The reserve currency status of US does not benefit US on a net basis. This is sort of like the tragedy of commons. The US dollar is used as a common good for settling international trade, and countries that use the dollar benefit from the reduction of friction but do not incur the costs. So who gets the paycheck? Of course the US does.
The US pays for their reserve currency status with current account deficits, because many countries try to hoard dollars by running a trade account surplus against the US. They employ mercantilistic policies for doing this.
A lot of people talk about dollar recycling. Their logic is, if the dollar loses its reserve currency status, the US will not be able to finance their massive deficits. What they don't understand is that if the dollar wasn't the reserve currency, the deficits wouldn't have been there in the first place.
So this article may be in the interest of gold bugs, but is nontheless flawed.
Trade deficits mean we get to import goods and pay for them with paper that becomes the worlds reserves and money supply. (since we have been the worlds reserve currency) In short we get free stuff. This has increased our living standards since WW2. The process is changing. Slowly other currencies are being held as reserves and more trade is done outside the US Dollar. If the dollar suddenly stopped being the worlds reserve currency our living standards would sharply decline. But more likely, as has happened the last decade, it will be a slow erosion with the Euro or Chinese currency increasing in importance.
There is no free shit for anyone.
Disagree. Americans benefit greatly from the dollar's exorbitant privilege.
<<This is a very flawed article. The reserve currency status of US does not benefit US on a net basis. This is sort of like the tragedy of commons. The US dollar is used as a common good for settling international trade, and countries that use the dollar benefit from the reduction of friction but do not incur the costs... The US pays for their reserve currency status with current account deficits, because many countries try to hoard dollars by running a trade account surplus against the US. They employ mercantilistic policies for doing this... A lot of people talk about dollar recycling. Their logic is, if the dollar loses its reserve currency status, the US will not be able to finance their massive deficits. What they don't understand is that if the dollar wasn't the reserve currency, the deficits wouldn't have been there in the first place. So this article may be in the interest of gold bugs, but is nontheless flawed.>>
Yes. I admit to giving it a rather sentimental "4" score, b/c I thought it made several good points along the way, but you are right. On the whole its persective seems very flawed.
Mises Canada has an unfortunate habit of trying to please both the realist audience, and the paperbugs. The site has some good information but every article I've read there so far has to be read with a discerning eye, to weed out the inevitable misinformation due to this weird ahistorical perspective skew they seem to have. Someone at that blog seems to accept that "reserve currency", along with other global-fiat innovations, is or should be "normal".
In reality, this is the very first time that the world's populations have been stupid enough to accept a "world reserve currency". I certainly hope it will be the last.
Having your country's central bank be the issuer of a reserve currency is truly overrated, unless you're a bankster and you can use the fact that reserve demand makes your currency worth far more than it can actually buy in the home country to off-shore production to countries whose currencies' reserve demand is basically zero.
To put it another way, if the dollar lost its reserve currency status, the banksters would be furious because not only would they have to pay more for their organic strawberries and cream and their exotic vacations in the developing world, but their business model of selling proles cheap Chinese crap instead of paying Americans to make goods that last would no longer be viable.
For the proles, who would finally be able to find work again at good, well-paid manufacturing jobs once American manufacturing had become competitice again, having to vacation closer to home wouldn't be a tragedy.
Some truth in what you say as reserve status benefits large New York banking institutions. On balance ALL americans have benefited from our reserve status as my post above indicates. As far as the good manufacturing jobs thing. Dream on. There has only been one short, (25 year) period of time when manufacturing jobs provided high real wages. That was 1946 to 1972. Unless we bomb the hell out of every industrial power in the world and find ourselves the only country left with industrial capacity it won't happen again. That period was the aberation, not the norm, but too many can't or won't see those facts because it doesn't fit what they want to believe. If you want a good manufacturing job get some good schooling. Tool and die or welding are good places to start.
Iraqi Special Forces said they have arrested several ISIL’s foreign military advisors, including American, Israeli and Arab nationals in an operation in Mosul in the Northern parts of the country.
The Iraqi forces said they have retrieved four foreign passports, including those that belonged to American and Israeli nationals and one that belonged to the national of a Persian Gulf Cooperation Council (PGCC) member-state, from ISIL’s military advisors.
The foreign advisors were arrested in a military operation in Tal Abta desert near Mosul city.
Last year, a senior aide to Russian President Vladimir Putin accused Mossad of training ISIL terrorists operating in Iraq and Syria.
Alexander Prokhanov said that Mossad is also likely to have transferred some of its spying experiences to the ISIL leadership, adding that Israel’s military advisors could be assisting the Takfiri terrorists.
Prokhanov said ISIL is a byproduct of US policies in the Middle East."...
http://thesaker.is/iraq-arrests-isils-us-israeli-military-advisors-in-mo...
oops --
The probability that the World Wide Ponzi .... will be systematically dismantled .... and replaced with sound money .... before, the "Big Bang" .... Zero/One % !
as a mechanism of exchange and bartering, I think Bit coin has merit, however
money=gold=money and nothing else, said some really important financial guy.
Blah blah blah. It is a reserve currency in the sense that you better keep some reserves of it or you won't be buying any petrol. i.e. petrodollar. Mess with that arrangement and you'll be welcoming an incoming ICBM.
Silver For The People
We all have the same interest. We all want to have the highest standard of living for ourselves and our families.
Uh, actually, the slimy POS banksters don't want your family to be happy, healthy, safe, or have anything approaching a decent standard of living - their philosophy is, as the chief parasite "Bibi" said, (sic) "Once we have sucked what we can out of the United States, (the World) it can dry up and blow away" It would be a massive mistake to ever consider Central Bankers and their minions human. They are, for all intents and purposes, souless, psychopathic monsters. Perhaps someday, with enough awareness of the people, they can hopefully share the same fate as the dragons of yore...
There are only 12 - 13 million Jews .... I think you exagerate their prowess ! Your obsession with them .... is a little gay !
hmm, scanned their post...no mention of "Jews". only a reference to an Israeli. and it was spot on. don't get me wrong, i rail agaisnt those who concetrate all of the wold's ills on "Jews" also (did not junk your post) but that isn't the case here. what really pissed me off was the horrible show of Isreali ownership of the US Congress last week.
Rome, Britain once constituted the world's reserve currency.
How many countries still even peg to the dollar . . . most of the big players already left . . . The Reserve currency status is bullshit, the peg to U.S. dollar was probably weighing the dollar down more than anything . . . anyway. . . let all the currencies free float and compete for the same resources, then you will see how bad all the other currencies like the Euro etc. really are . . .
The Board of Governors of the Federal Reserve System and the Federal Open Market Committee shall maintain long run growth of the monetary and credit aggregates commensurate with the economy's long run potential to increase production, so as to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates.
[12 USC 225a. As added by act of November 16, 1977 (91 Stat. 1387) and amended by acts of October 27, 1978 (92 Stat. 1897); Aug. 23, 1988 (102 Stat. 1375); and Dec. 27, 2000 (114 Stat. 3028).]
Hmmm, Fed Reserve Policy .... contradiction in terms.
Expecting monetary reform to be enacted voluntarily is like expecting a 99 year old man to run a sub 9 second 100 yard dash....Good Luck With That!
Festering Fistulas of Fiat !
Meet... Fickle Finger of Fate
http://assets.paleycenter.org/assets/perspectives/rowanmartin/fickle-fin...
*Sigh* Wanting something to happen really badly and it actually happening are two different things. It is really ironic that ZH is pushing this cause while the dollar is soaring. Really, people around the world can't get enough dollars. Would you rather have Yen or Euros? They will explode long before the dollar
"The best antidote is to abolish central banks altogether and allow private institutions to engage in money production subject only to normal commercial law." This is where the Mies lose their minds,... and money production subject to normal commercial law? Really? Taking the control of money creation out of the control of the people creates a bigger problem than today. Can you imagine a bunch of Jamie Diamons and Lloyd Blankenfeins running loose creating mo'money subject to normal commerical law? And it would be worse than that. No, you need a central bank, but not a private central bank and it needs to be owned by the legislative branch of government and that legislature must pass all the laws and policy that governs that bank, and its singular duty must be to strictly govern and regulate the solvency of every lending institution that practices within the boundaries of the state. Further, this legislative duty to create law must also apply to any other agency of the government that is created from any "Necessary & Proper Clause". Proper means laws and policy that is a law must be passed only by the legislature otherwise it is only "Necessary but not necessarily Proper".... there is a difference. Further, this Mies consideration contemplates the money created by private banks would be backed by any kind of commodity... Does he mean like China does? Because that is what is going to happen as all kinds of commodities (does that include Bennie Baby's?) will sooner than later be hypothecated leading to the next scandal that drains law abiding citizens of their wealth... and when that shit hits the fan, what bank is going to step in to revive things and with what, more hypothecated coal, or copper, or straw, or will they just enlist the aid of Rumpleskillskin who will charge the nation but it first born sons? What hypothecated nonsense, what innocent but gross stupidity. Can you imagine these people actually get paid to write this and that they surround themselves with like minions cheering them on? They sound like government employees.
I think his point is that a free market in money would ensure strong money. Government controlled money always ends up in failure because politicians and bureacrats can't resist the temptation to print money (currency) to pay for all their welfare & warfare state. You'll notice he doesn't suggest giving corrupt bankster scumbags a "get out of jail free card" like they have now. If there were choices in money, people like Blankfein and Dimon wouldn't be able to pull off their blatant theft because nobody would trade their labor or goods for their filthy money. If they created money in darkness (like you know they would), people would have the opportunity to choose a different form of money - one where the currency was backed by something substantial - or at least something they had faith in. The more transparent the money creation entity, the more faith people would have in that money, and the more value it would carry. The slimy Central Bankers, who do everything behind closed doors and in the dark, wouldn't be able to compete with an entity that, say, backed their currency with gold, and published quarterly third-party audits of their holdings and how much currency they'd released into the wild. The market would determine the value of the currency you held - not a bureacrat's edict. If you had the choice of multiple currencies - assuming you didn't want to carry gold around in your pockets - you would choose the most stable - the one who's creator was the most transparent about how they operated. If that organization started to get flakey, you would move to a different currency - one that was more in the open. Central Banks ensure that financial power remains concentrated and virtually guarantee corruption of the monetary system. The Founders tried to tie the hands of the Federal Government when they gave them the reigns to print currency by tying that creation to silver and gold - but we all know that the parasites that are bankers couldn't stand not being able to slowly suck the life out of a nation, so it didn't last .... they found patsies and morons to bribe - and now we're living the repercussions of giving yet another Central Bank power over a nation's currency. Personally, I'd like to see Central Banks sit out a few innings - they've pretty much shown that they suck at everything they've promised. I say, we give it a shot without them for a change.
Bingo!
If/when the USD loses its GRC status, it will be DEMOTED to a Regional Reserve Currency (RRC).
As an RRC, the Fed can back it with whatever they want AND can get away with. It might be gold, or it might be a basket of real assets... e.g. PM + Oil + Natgas. Since N.Am. has plenty of all this, plus a large and diverse economy, it will not be the end of the world, only the end as we know it.
Yes, a lot of peeps will lose out, but after the banker-initiated and controlled Reset, things will eventually stabilize some months later. And life will go on.
The CBs for the other regions (China, Brazil, EU, Russia, India...) may choose a different Basket to back their RRC. Given that all politicians are whores and all Govs love to spend OPM, it is highly doubtful that even the BRIICS will have only gold to back their currencies. Rather, they will likely have some % of their fiat backed by Gold.
As such, the price of PM in North Am. is difficult to predict, and I'd be careful how much of my Disposable Income I'd park in PM. A person needs only so much "Insurance".
Given the falling prices of PM in the last 2 years, I'm having an increasingly difficult time calling my own PM Insurance Policy a "store of value" -- given that a "store or value" is supposed to RETAIN its value. You see, I'm big on math, not on PM-dogma... dogma that is akin to a religious cult (as some shills here are treating/spouting it).
"The US has by far the largest gold reserves" you just can't see it or audit it.
Because it isn't there. Central banks have it all.
Don't worry Hilldebeast will answer where is all of the U.S. Gold. Or you can ask China.
Central banks would be too obvious.
Try The Outer Banks.
Iraq Arrests ISIL’s US, Israeli Military Advisors in Mosul
Iraqi Special Forces said they have arrested several ISIL’s foreign military advisors, including American, Israeli and Arab nationals in an operation in Mosul in the Northern parts of the country.
The Iraqi forces said they have retrieved four foreign passports, including those that belonged to American and Israeli nationals and one that belonged to the national of a Persian Gulf Cooperation Council (PGCC) member-state, from ISIL’s military advisors.
The foreign advisors were arrested in a military operation in Tal Abta desert near Mosul city.
Last year, a senior aide to Russian President Vladimir Putin accused Mossad of training ISIL terrorists operating in Iraq and Syria.
Alexander Prokhanov said that Mossad is also likely to have transferred some of its spying experiences to the ISIL leadership, adding that Israel’s military advisors could be assisting the Takfiri terrorists.
Prokhanov said ISIL is a byproduct of US policies in the Middle East.
http://thesaker.is/iraq-arrests-isils-us-israeli-military-advisors-in-mo...
The network of central banks that our ruling banking cartel had planned was only a stepping stone to the establishment of One Bank and One Socialist State and One Currency: the SDR as envisioned by the planners at Bretton Woods.
Even a child could see that a world with one kind of money, made of paper, leads to a world of complete social, civic and military control of every person on the planet by those few who control the currency.
The theoreticians who drafted the Bretton Woods agreement were the well-known Fabian Socialist from England, John Maynard Keynes, and the Assistant Secretary of the U.S. Treasury and outed Communist, Harry Dexter White.
“The method by which this was to be accomplished was exactly the method devised on Jekyll Island to allow American banks to create money out of nothing without paying the penalty of having their currencies devalued by other banks. It was the establishment of a world central bank which would create a common fiat money for all nations…”
The method by which the IMF/World Bank were to achieve its goals “was to terminate the use of gold as the basis of international currency exchange and replace it with a politically manipulated paper standard. In other words, it was to allow governments to escape the discipline of gold so they could create money out of nothing without paying the penalty of having their currencies drop in value on world markets.” – G. Edward Griffin
For this fiat buck…issued, printed, valued and secretly spent by its private owners, the Federal Reserve, for all the banking cartel’s debts, public and private, and its private profits, has not only created instability throughout national and world price levels but has given control of the American Government to international financiers.
It is massive power, for they who control the credit of a nation or a world direct the policy of governments and hold in the hollow of their hands the destiny of the people. As Woodrow Wilson lamented in 1916, three years after signing into law the Federal Reserve Bank of the United States, “The growth of the nation, therefore, and all our activities are in the hands of a few men…”
And now, the American dollar is losing its function--as a dependable medium of exchange and stable store of value.--in short, as money.
https://en.wikipedia.org/wiki/Harry_Dexter_White
Says it all.
This country is fully 100% bankrupt. The ignorant brainwashed libtard communist have seen to that by electing communist dictators to office. Gnashing of teeth of the libtard population will become the status quo for the people. FUBAR!
www.usdebtclock.org
Bitcoin is the 'come hither' siren call of the end-game towards complete, lock-down control of a populace. Your only alternative from there is an underground 'bartering' community, which will be crushed with extreme prejudice by the ruling elite. Blind followers who could care less about Liberty and Real freedom, won't know any better and will get what they have coming anyway.