Why? Isn't it awesome? I love the font of the 5, and the V... The depth is is wonderful.
I'm not one of those "get back on the gold standard" type people, but there's something about seeing "silver dollars" vs "backed by full faith and credit of government" ... That tangibility really does add something, I think. Seeing it in writing certainly enhances or verifies that to me.
We sure had some amazing money before the moralists stepped in. It's kinda a reminder of how recent the sobriety of our times really is, you know?
And yes...it's interesting to note that this is clearly money from a different currency system-- "This certifies that there have been deposited in the treasury of the United States five silver dollars payable to the bearer on demand."
Very different from our fiat currency-- "This note is legal tender for all debts public and private."
Yeah, the first thing that struck me is the silver dollars... I'm not really sold on the whole "gold standard" thing, mostly, not due to the concept itself, but more the people who hold to it.
I think we've discussed it before. I'm not quite sure what your thoughts on the matter are, as I thought you thought it really immaterial whether it's fiat or backed by anything.
But I have to admit, even though I know the theory of metal backing of a dollar, seeing it in print like that really struck me. It really did grant a whole different sense of reality or solidity that seems so lacking in our current era of print-on-demand money.
Ashcroft is pissing himself over that note!
I really loved the quality of engraving of it, though. The depth, and my favorite is the font of the 5.
Well, I've mentioned the issue of having a deflationary currency before. I haven't had time to figure out if you can build up an alternate economy on a deflationary currency that keeps working like any I know.
But here's a fair question-- if the government were to go into collapse, what insurance would there have been that that note could be exchanged for five dollars of silver? Your local bank could exchange the note for measures of silver, but then it would turn around and ask banks above it for reimbursement in silver...leading to the US Treasury. If it refuses to honor notes, as a government might if it...say...dissolves, then a silver certificate is still worthless.
If we're going to be on a precious metal standard, then the value of a note is still only based on the confidence it can be exchanged for a precious metal. This doesn't nullify the argument that it's harder to inflate currency on a precious metal standard, but that whole "If the government falls apart..." argument stops sounding nearly as rosy.
There are plenty of circumstances where a currency collapse can happen without, or at before a government collapses. Real money is supposed to deal with those possibilities and eliminate inflation.
Of course the silver standard is less attractive since it trades and is used more like an industrial commodity and even the gold standard has it's issues.
To me, the problem is irresponsible use of credit. I don't care if you are an individual or government using real or fiat currency, if you borrow at the rate and ratios that we have, you are digging your own paupers grave. I find is fascinating that the same irresponsible credit issue is shared by so many US citizens in their personal finances too.
I agree that the credit issue is a big part of it.
While real money is supposed to deal an issue of currency collapse, it's interesting that, afaik, all the collapses (i.e. depression, not simple deflation) in US history I'm aware of happened while on a backed currency. I know the extreme right has a big issue with the Fed (and I certainly have my qualms), I think the purpose for which they were created (at least the public purpose) was to prevent depressions, and so far it's worked. But it seems it's unraveling at the thread...
Don't forget the role of greed in this... Greedy consumers spend beyond their limit, greedy creditors hand it out like candy. Greedy investors jump into the risk distribution game (in this latest housing fiasco, at least)... Every time I read about what's happening here, I just get sick at what a fucking con-game it all is. Maybe all the others were like that, too. I knew Enron was. I don't remember much of the S&L scandal, but I'm sure that is, too.
If I had my way, the fuckers who created this scheme (can't recall what they call it) would be sent away to a long prison sentence, even if it is a white collar prison, they deserve some sort of punishment for this fucking mess. But instead, we bail them out.
I heard a news story on the radio recently discussing a bank setting limits (finally) on new home purchases: down payments, proper ratio of income/payment and most importantly, IMO, is requiring the person buying the home to be a tenant as well. No more of the bullshit "flipping" houses. I knew, when I saw all that shit going on years ago, we were in trouble.
We started being in trouble the moment people took out home equity loans for things other than further improvements on the equity of their homes. Using home equity lines as a piggybank is every bit as responsible for our current problem as predatory lending tactics.
At the same time, perhaps half these irresponsible people wouldn't have a home to collect mortgage if they weren't lent the money in a fiscally irresponsible way.
I think the point is the mess is systematic and culture wide, and it's not clear who influences who. The top and bottom intermingle in an incestuous orgy of fiscal stupidity, and we await with abject horror the final birthing of whatever mutant child results.
In a very vague way, part of what happened made sense. If I gave you a machine that simply ejected money every month, wouldn't you want it. This has all happened because "real estate never goes down in value" creating a hallucinated endless stream of equity to tap.
Ultimately, real estate values started to drop. This sprung the credit trap.
There are plenty of circumstances where a currency collapse can happen without, or at before a government collapses.
Yes, but in a very real sense, aren't currency issues and banking issues tied? If I have a precious metals note in my hand and can find no place to accept it, then what's the point?
Real money is supposed to deal with those possibilities and eliminate inflation.
That's allegedly what a precious metals standard does, yes. I've just never worked out what an economy with a deflationary currency would look like, and that's inevitable on a precious metals standard today.
Granted, the situation you're describing can be achieved just as quickly on fiat currency that you then don't print.
To me, the problem is irresponsible use of credit. I don't care if you are an individual or government using real or fiat currency, if you borrow at the rate and ratios that we have, you are digging your own paupers grave. I find is fascinating that the same irresponsible credit issue is shared by so many US citizens in their personal finances too.
Indeed. I suspect there's a basic aspect of human psychology feeding it.
The big fear of fiat currency is that a government can and will try to print themselves out of pickles because it's politically expedient to do so. This is predicated on the theory that excessive printing will postpone problems, but eventually they grow so large that the whole system collapses.
In fairness to the real money camp, this has happened a number of times in history. Rome, Argentina, Germany post WWI etc.
In fairness to the fiat backers, the ability to print can soften the blow of recessionary cycles and interest rate hikes (pulling some of that money back in) may be able to deflate some bubbles so that the normal highs and lows are not so drastic.
The semi-independent fed is supposed to guard against some of this by preventing major deflationary sins like printing money to pay back all of our federal debt. The fact that we borrow in dollars helps keep the system propped up by making sure the creditors have a vested interest in a strong dollar. Oil markets being exclusively dollar denominated used to help until recently with the euro breaking in.
The jury is still out on our ultimate fate of the dollar, but I fear our creditors won't want our IOUs in such large supply soon. At the very least, you can expect buying power to continue to decline against global currencies. There are some who believe this is an intentional devaluing intended to make the cost of american labor/products competitive again.
I'm a little agnostic about it all. It's very complicated stuff.
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no subject
Date: 2008-02-20 03:14 am (UTC)no subject
Date: 2008-02-20 03:36 am (UTC)hahaha you're so funny. :)
no subject
Date: 2008-02-20 04:25 am (UTC)I'm not one of those "get back on the gold standard" type people, but there's something about seeing "silver dollars" vs "backed by full faith and credit of government" ... That tangibility really does add something, I think. Seeing it in writing certainly enhances or verifies that to me.
no subject
Date: 2008-02-20 04:16 pm (UTC)oh, i agree... it's definitely awesome/fascinating
but your post made me laugh because it's like... who else would make a post like this? nobody on my list! and i like it.
no subject
Date: 2008-02-20 04:53 pm (UTC)no subject
Date: 2008-02-20 04:31 am (UTC)And yes...it's interesting to note that this is clearly money from a different currency system-- "This certifies that there have been deposited in the treasury of the United States five silver dollars payable to the bearer on demand."
Very different from our fiat currency-- "This note is legal tender for all debts public and private."
no subject
Date: 2008-02-20 04:46 am (UTC)I think we've discussed it before. I'm not quite sure what your thoughts on the matter are, as I thought you thought it really immaterial whether it's fiat or backed by anything.
But I have to admit, even though I know the theory of metal backing of a dollar, seeing it in print like that really struck me. It really did grant a whole different sense of reality or solidity that seems so lacking in our current era of print-on-demand money.
Ashcroft is pissing himself over that note!
I really loved the quality of engraving of it, though. The depth, and my favorite is the font of the 5.
no subject
Date: 2008-02-20 04:55 am (UTC)But here's a fair question-- if the government were to go into collapse, what insurance would there have been that that note could be exchanged for five dollars of silver? Your local bank could exchange the note for measures of silver, but then it would turn around and ask banks above it for reimbursement in silver...leading to the US Treasury. If it refuses to honor notes, as a government might if it...say...dissolves, then a silver certificate is still worthless.
If we're going to be on a precious metal standard, then the value of a note is still only based on the confidence it can be exchanged for a precious metal. This doesn't nullify the argument that it's harder to inflate currency on a precious metal standard, but that whole "If the government falls apart..." argument stops sounding nearly as rosy.
no subject
Date: 2008-02-20 01:41 pm (UTC)Of course the silver standard is less attractive since it trades and is used more like an industrial commodity and even the gold standard has it's issues.
To me, the problem is irresponsible use of credit. I don't care if you are an individual or government using real or fiat currency, if you borrow at the rate and ratios that we have, you are digging your own paupers grave. I find is fascinating that the same irresponsible credit issue is shared by so many US citizens in their personal finances too.
no subject
Date: 2008-02-20 02:37 pm (UTC)While real money is supposed to deal an issue of currency collapse, it's interesting that, afaik, all the collapses (i.e. depression, not simple deflation) in US history I'm aware of happened while on a backed currency. I know the extreme right has a big issue with the Fed (and I certainly have my qualms), I think the purpose for which they were created (at least the public purpose) was to prevent depressions, and so far it's worked. But it seems it's unraveling at the thread...
Don't forget the role of greed in this... Greedy consumers spend beyond their limit, greedy creditors hand it out like candy. Greedy investors jump into the risk distribution game (in this latest housing fiasco, at least)... Every time I read about what's happening here, I just get sick at what a fucking con-game it all is. Maybe all the others were like that, too. I knew Enron was. I don't remember much of the S&L scandal, but I'm sure that is, too.
If I had my way, the fuckers who created this scheme (can't recall what they call it) would be sent away to a long prison sentence, even if it is a white collar prison, they deserve some sort of punishment for this fucking mess. But instead, we bail them out.
I heard a news story on the radio recently discussing a bank setting limits (finally) on new home purchases: down payments, proper ratio of income/payment and most importantly, IMO, is requiring the person buying the home to be a tenant as well. No more of the bullshit "flipping" houses. I knew, when I saw all that shit going on years ago, we were in trouble.
no subject
Date: 2008-02-20 05:43 pm (UTC)no subject
Date: 2008-02-20 05:54 pm (UTC)I think the point is the mess is systematic and culture wide, and it's not clear who influences who. The top and bottom intermingle in an incestuous orgy of fiscal stupidity, and we await with abject horror the final birthing of whatever mutant child results.
no subject
Date: 2008-02-20 05:58 pm (UTC)Ultimately, real estate values started to drop. This sprung the credit trap.
no subject
Date: 2008-02-20 05:40 pm (UTC)Yes, but in a very real sense, aren't currency issues and banking issues tied? If I have a precious metals note in my hand and can find no place to accept it, then what's the point?
Real money is supposed to deal with those possibilities and eliminate inflation.
That's allegedly what a precious metals standard does, yes. I've just never worked out what an economy with a deflationary currency would look like, and that's inevitable on a precious metals standard today.
Granted, the situation you're describing can be achieved just as quickly on fiat currency that you then don't print.
To me, the problem is irresponsible use of credit. I don't care if you are an individual or government using real or fiat currency, if you borrow at the rate and ratios that we have, you are digging your own paupers grave. I find is fascinating that the same irresponsible credit issue is shared by so many US citizens in their personal finances too.
Indeed. I suspect there's a basic aspect of human psychology feeding it.
no subject
Date: 2008-02-21 02:13 am (UTC)In fairness to the real money camp, this has happened a number of times in history. Rome, Argentina, Germany post WWI etc.
In fairness to the fiat backers, the ability to print can soften the blow of recessionary cycles and interest rate hikes (pulling some of that money back in) may be able to deflate some bubbles so that the normal highs and lows are not so drastic.
The semi-independent fed is supposed to guard against some of this by preventing major deflationary sins like printing money to pay back all of our federal debt. The fact that we borrow in dollars helps keep the system propped up by making sure the creditors have a vested interest in a strong dollar. Oil markets being exclusively dollar denominated used to help until recently with the euro breaking in.
The jury is still out on our ultimate fate of the dollar, but I fear our creditors won't want our IOUs in such large supply soon. At the very least, you can expect buying power to continue to decline against global currencies. There are some who believe this is an intentional devaluing intended to make the cost of american labor/products competitive again.
I'm a little agnostic about it all. It's very complicated stuff.