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2017-08-16, 07:07 PM (ISO 8601)
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Re: OOTS #1089 - The Discussion Thread
They are still worth their weight in gold.
Prices would adjust accordingly based on supply and demand. More gold, less value.
That said, a new mine being able to add so much gold so quickly that its value took a 20% dive seems remarkably unlikely. That's a LOT of gold. Like pillaging the Mayans and bringing it home levels.
But I am sure you know this already...
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2017-08-16, 07:10 PM (ISO 8601)
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2017-08-16, 07:13 PM (ISO 8601)
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Re: OOTS #1089 - The Discussion Thread
The point isn't that a single mine cut the value by such a large amount, just that it is a clear example of the value of gold varying based on supply and demand. Which it does. You acknowledge the gold is suddenly worth less then. Now for the second part of the buying power question: How much can you afford? It used to be that your $10 coin could by 10 widgets. How many Widgets does your now $8 coin buy?
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2017-08-16, 07:22 PM (ISO 8601)
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- Jan 2015
Re: OOTS #1089 - The Discussion Thread
OK, just gonna repeat this real slow:
DEFLATION IS OFTEN NOT A GOOD THING!
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2017-08-16, 07:27 PM (ISO 8601)
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- Aug 2016
Re: OOTS #1089 - The Discussion Thread
Using unrealistic examples to build up your side of a debate is dishonest, and ultimately pointless. The whole point of intrinsic wealth, unlike fiat, is those sort of events where massive amounts of new money get added to the supply tend to not happen.
Why not stick to real life?
For example: How many ounces of gold can you get for $100 in 1950 compared to today?
What about milk (which has had massive improvements in cost efficiency since then)?
What about furniture? I bet a sub-par table at Walmart cost the same as a nice wood table did back then.
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2017-08-16, 07:31 PM (ISO 8601)
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- Aug 2016
Re: OOTS #1089 - The Discussion Thread
Do you disagree with that assessment of possibility?
If so, why?
Severe, sudden changes in money's buying power can always cause issues.
Again, gold is stable. It only has the opportunity to be more valuable and increase your buying power... nothing is guaranteed. Barring outside forces or inside corruption, gold will remain steady over the long haul.
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2017-08-16, 07:31 PM (ISO 8601)
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- Jan 2015
Re: OOTS #1089 - The Discussion Thread
Again: Spain. It' s the price of having a currency whose supply is out of your hands. It's possible for, say, someone to import enough gold that the value of gold in general starts falling, leading to mass inflation. Indeed, that is EXACTLY WHAT HAPPENED with Spain. They imported so much gold, that its value fell across all of Europe.
Last edited by woweedd; 2017-08-16 at 07:31 PM.
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2017-08-16, 07:34 PM (ISO 8601)
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- Aug 2016
Re: OOTS #1089 - The Discussion Thread
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2017-08-16, 07:37 PM (ISO 8601)
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- Jan 2015
Re: OOTS #1089 - The Discussion Thread
Last edited by woweedd; 2017-08-16 at 07:47 PM.
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2017-08-16, 07:41 PM (ISO 8601)
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Re: OOTS #1089 - The Discussion Thread
Because you have discarded every example of these things happening in real life as irrelevant, and I'm objecting to your premises. In this case, that gold's buying power remains stable because it is Intrinsic Currency. So I'm giving you an example of how gold's value can decrease. But fine. How about that chart I linked in the last post? Can gold coins buy more, less, or the same amounts when you compare a currency made of gold during May of 2003 when compared to July of 2002?
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2017-08-16, 07:55 PM (ISO 8601)
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- Aug 2016
Re: OOTS #1089 - The Discussion Thread
What???
How does taking a single event where one Country conquered the bulk of a Continent and act like that is the norm? I posted over 20 recent fiat currency collapses; you (your side, not you specifically) have two- one involving massive conquest and remarkably rapid gold acquisition, and the other not only had outside forces like invasions and famine- but had the people in charge of keeping the currency pure debasing it via 'chipping'.
You know what has sudden shifts, massive expansions and contractions built into the system: fiat money. Not gold.
None of your examples have been rooted in reality. A mine that suddenly adds 20% more gold in an instant? Pffft. Try again.
Also, I think you owe me some answers...
Lastly, how much gold will buy in 2002 v 2003 is next to impossible to fairly debate using that chart. The value of gold is based on FRN buying power, not golds buying power. A very important distinction.
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2017-08-16, 07:59 PM (ISO 8601)
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2017-08-16, 08:03 PM (ISO 8601)
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- Aug 2007
Re: OOTS #1089 - The Discussion Thread
I have given you three examples, not two. You, on the other hand, have yet to provide even one example of a stable gold-backed currency with no inflation or FRB, that lasted more than 100 years without devaluating, crashing or adulterating the coinage.
Also, as I said before: strange how all the crisis in fiat economies are the fault of the fiat currency, but all the currency crisis of gold-backed currencies are always external. Double standard, much?
Grey WolfLast edited by Grey_Wolf_c; 2017-08-16 at 08:08 PM.
Interested in MitD? Join us in MitD's thread.There is a world of imagination
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2017-08-16, 08:48 PM (ISO 8601)
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- Aug 2016
Re: OOTS #1089 - The Discussion Thread
Because your chart shows the FRN value of gold during a period of time.
To fairly answer it, you need to see the price of other goods in relation to the FRNs buying power. If you do that, you will see most, of not all, goods value rose when golds did... Likely in fairly close relations to each other.
Why?
Because what you think is the value of gold rising -> is actually your buying power lowering.
What was the third?
No offense, but as a general rule of thumb I don't read your post in this thread, you proved your lack of knowledge at the start of this discussion.
The Ottomen empire, Rome before 200AD, Ancient Egypt and Greece. Many countries throughout the world have had success with gold as their money... but, man is always corruptible. Especially when given power over other men.
Fiat money, however, is corrupted by design. Power tends to want more power, and when you give men of power unlimited money... bad things tend to happen fairly quickly.
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2017-08-16, 09:02 PM (ISO 8601)
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- Aug 2007
Re: OOTS #1089 - The Discussion Thread
England. Elizabeth I reign. 600% inflation.
No, you just insulted me, without actually providing anything other than "because you said so". Simply saying that my arguments are fraudulent doesn't make them so, nor does it actually change history.
Listing random places does not tell me what period used what you consider gold-backed, non-devaluated/adulterated the coinage. It also doesn't demonstrate your thesis that inflation cannot happen with gold-backed currency.
Look, I can do the list of countries too: Austro-Hungarian Empire pre-1912, Norway, Tuscany.
So, in short, gold-backed currency is no more secure, or safe, or stable, impervious to corruption, nor can it prevent inflation, cannot compensate for sudden changes in import or export of certain metals, cannot grow at the speed of the economy, and yet somehow you think it is better than fiat, even though fiat has some, but not all, of those issues.
Grey WolfInterested in MitD? Join us in MitD's thread.There is a world of imagination
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And myth and legend thrive
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2017-08-16, 09:07 PM (ISO 8601)
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- Jan 2015
Re: OOTS #1089 - The Discussion Thread
You're doing exactly what Grey_Wolf_C just accused you of. Attributing the failure of gold currency to outside factors while attributing the failure of fiat currency to some sort of inherent corruptibility of fiat. It's almost like you care more about the truth of your axiomatic philosophy regarding power then actual facts...
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2017-08-16, 09:16 PM (ISO 8601)
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- Aug 2007
Re: OOTS #1089 - The Discussion Thread
Grey Wolf is fine. Always amazes me that people bother with the underscores and the random letter. Seriously, they're there only because back when I came up with the handle*, Grey_Wolf was already taken, and spaces weren't allowed.
GW
*Pre-http. More than 20 years ago now. Damn I'm old.Last edited by Grey_Wolf_c; 2017-08-17 at 07:57 AM.
Interested in MitD? Join us in MitD's thread.There is a world of imagination
Deep in the corners of your mind
Where reality is an intruder
And myth and legend thrive
Ceterum autem censeo Hilgya malefica est
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2017-08-16, 09:19 PM (ISO 8601)
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- Aug 2016
Re: OOTS #1089 - The Discussion Thread
To be fair, didn't see inherit an economic disaster from Henry VIII? I seem to recall he debased England currency something fierce. She actually repaired the currency- but messed up the over all economy being very monopoly friendly, iirc.
Nothing in the hands of man is perfect. God could give man the literal perfect document and the second man touches it- he will start to 'interpret' it and everything goes down hill from there.
Intrinsic wealth is not immune to mankind; but it is more stable by its very nature- and that natural state is very beneficial to economies. It also does not need a government to be a currency (though, it is probably best to have one).
Take every possible thing that can go wrong with intrinsic money and push the fast forward button. That is effectively what fiat money is, by design.
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2017-08-16, 09:24 PM (ISO 8601)
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- Aug 2016
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2017-08-16, 09:35 PM (ISO 8601)
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2017-08-16, 09:46 PM (ISO 8601)
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- Dec 2015
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Re: OOTS #1089 - The Discussion Thread
Eh, I don't like gold as currency, with it's use in electronics, I'd be too afraid gold will gain in value, prompting people to hoard it, and since one person's spending is another person's income, I think that would be bad.
How about something else "intrinsic"?
I've read that soda pop is being used as currency in some parts of the USA, similar to cigarettes in prison, but I don't much like either
When I was a kid, my parents called money "bread", but I think bread would lose value too fast.
My Dad, always quickly exchanged money for something made from a plant, on the theory that it would "get you through times of no money, better than money will get you through times of no....", but I think that people would quickly turn in the plant for Hostess Twinkies, which I think don't go stale fast enough, to encourage spending.
Some whiskey's and wines get better with age, so that would discourage spending, which I dislike.
Since I'm in favor of currency slowly, but steadily losing value, how about Pale Ale backed money?
In fact, I'd be willing to trade-in the paper money in my wallet for an IPA (and a corned beef sandwich) right now!
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2017-08-16, 09:57 PM (ISO 8601)
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- Dec 2013
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Re: OOTS #1089 - The Discussion Thread
“Evil is evil. Lesser, greater, middling, it's all the same. Proportions are negotiated, boundaries blurred. I'm not a pious hermit, I haven't done only good in my life. But if I'm to choose between one evil and another, then I prefer not to choose at all.”
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2017-08-16, 10:50 PM (ISO 8601)
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2017-08-16, 11:13 PM (ISO 8601)
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- Dec 2009
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Re: OOTS #1089 - The Discussion Thread
So, uhhhh... what's the functional difference between an improbably efficient mine and pillaging an unknown civilization's treasury? It seems to me that either way is a sudden influx of gold that would devalue the existing gold. The only difference is the source, which doesn't really matter.
Cuthalion's art is the prettiest art of all the art. Like my avatar.
Number of times Roland St. Jude has sworn revenge upon me: 2
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2017-08-16, 11:22 PM (ISO 8601)
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- Aug 2016
Re: OOTS #1089 - The Discussion Thread
Of course.
The value between items is always relative, more gold - less worth - less cost in FRNs. FRNs have, in fact, gained on gold. Too much so and you'd call it deflation.
Fortunately(?) that very rarely happens over the long haul. After all, the very nature of fiat money is to rapidly expand. It does so because it can. And it starts in two places.
Not sure its portable enough for such a task, but I'd take a beer based currency over fiat any day. At least you couldn't create a million of them at a time.
You are on the right track.
Just like the diamond market, you don't just turn the faucet on full blast- you start, relatively speaking, small.
Think about it, the government writes a budget:
-In a intrinsic system that government has to say... "We have X gold. We expect buying power to stay stable and we are gaining Y gold per month, that means we can spend Z gold" (and should probably hold some back just in case and, you know, save it- just in case an emergency happens).
Intrinsic wealth grows at a slower, steady pace. Governments can't spend what the don't have.
-In a fiat system that government gets to says... "Last year we spent X money- keeping up with inflation we need to spend 1% more this year than last to cover base-lined expenses. We also want to do other projects, so lets add a few in while we are at it" (and those are now part of next years base-lined budget). What about emergencies? We can print more on the fly, forgetaboutit.
Year after year as that debt increases- your buying power is slowly dissolving away. It can only stop when its value gets too close to 0 that no one uses it. You reach your "alleged unlimited wealth" cap, so to speak.
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2017-08-16, 11:32 PM (ISO 8601)
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- Aug 2016
Re: OOTS #1089 - The Discussion Thread
I agree, any time you multiply your money supply you are on borrowed time.
Now I would hope we would have learned our lesson from Spain. In the case of Intrinsic money if we found a series of asteroids that had exuberant amounts of gold- perhaps we wouldn't rush to mine them. (Now, I don't readily trust man to do that- but should that happen at least it is a possibility; and, there's no guarantee that such a discover will even happen).
By contrast, fiat money is multiplicative by design.
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2017-08-16, 11:39 PM (ISO 8601)
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2017-08-17, 12:28 AM (ISO 8601)
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2017-08-17, 05:43 AM (ISO 8601)
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2017-08-17, 07:53 AM (ISO 8601)
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