OOTS #1089 - The Discussion Thread

[theNater]

You seem to be confusing two plumbers doing the same job, one finishing in 2 hours and the other in 20. I am referring to two different jobs, with different needs and solutions where one takes 2 hours and the other, more complicated one, takes 20.

Crafting a table while one has a broken arm is a more complicated job, with different needs and solutions, than crafting a table while whole and healthy. If you don't believe that, try doing carpentry work with one hand immobilized.

Gold has real, physical constraints.

But governments can still buy it all and put it into circulation at once, right? Something responsible governments won't do; that's what you said. So since we have to rely on governments being responsible anyway, why are those particular physical constraints meaningful?

[alwaysbebatman]

Gold has real, physical constraints. You have to choose your projects wisely and try to get the best bang for your buck, so to speak.

The physical restraints on the amount of gold in the economy are arbitrary and not calibrated or possible to calibrate to the amount of currency optimal to be in the economy at a given time.

If you are using fiat currency, you always know that you have to be careful how much you add to the system to allow growth but avoid too much inflation. If you trust in gold to not grow too fast, just look at how the Spanish Empire collapsed under the weight of gold.

[Cazero]

Gold has real, physical constraints. You have to choose your projects wisely and try to get the best bang for your buck, so to speak.

Not really. By your own admission, regulations are mandatory.

A responsible government will regulate the money supply in steady fashion. Not just buy all the gold and put it into circulation at once. It will save a reserve of circulated money in times of mining booms, so it can account for shortfalls later.

So, if I make an economy backed by granite (or carpentry) using regulations as rigorous as what is required for gold, it should work? How come nobody tried that? Maybe people make a big deal of gold for no reason?
And since nobody actualy uses gold in a transaction, what stops a greedy irresponsible governement to print more paper money than their gold can back?


And then, for some reason, you decide that the exact same kind of regulations can't be applied to paper money.

Paper, on the other hand, you create as needed/wanted. There is no real constraint in the system. Sure, there is a budget, but that really only serves as a guide line. You can have a trillion dollar budget and add 200 billion new dollars per quarter on top of it without batting an eye. (And it gets many times worse when you consider the fractional reserve aspects of our modern fiat system). All the while, each time new money gets dumped into the supply- we lose a little more buying power and live with a little less.

But why? You already need regulations to stop gold from flooding/starving the market. What stops a responsible governement from applying similar regulations controling the amount of fiat paper money they print?

[Erys]

Crafting a table while one has a broken arm is a more complicated job, with different needs and solutions, than crafting a table while whole and healthy. If you don't believe that, try doing carpentry work with one hand immobilized.

No one has disputed this.

But in the end of the day only the final product matters. If you make a terrible table, busted hand or not, you won't get paid as much for it. Period.

But governments can still buy it all and put it into circulation at once, right? Something responsible governments won't do; that's what you said. So since we have to rely on governments being responsible anyway, why are those particular physical constraints meaningful?

A divine, perfect being could hand mankind clear, precise details on how to run the perfect government and economy... and the second man touches it, its open to creative interpretation, technicalities and the like.

At least with intrinsic metal there is a natural, physical limit to how much government bodies can add to a money supply. With fiat currency- there is no limit.

The physical restraints on the amount of gold in the economy are arbitrary and not calibrated or possible to calibrate to the amount of currency optimal to be in the economy at a given time.

If you are using fiat currency, you always know that you have to be careful how much you add to the system to allow growth but avoid too much inflation. If you trust in gold to not grow too fast, just look at how the Spanish Empire collapsed under the weight of gold.

Again, the Spanish empire is an exception, not the rule. They found massive amounts of gold and recklessly added it to there existing supply. When you double you money supply in short amount of time you are setting yourself up for calamity.

Fiat currency has no natural limits on how much can be created; it encourages reckless and wasteful spending. It promotes the creation of more and more government bureaucracy and red tape.

Worse, even if you have men of integrity at the helm, inflation is part of that system no matter what. You might think 1% inflation per year is great, but after 50 years you still can only buy half of what you could when you were a young man... and as you get ready to retire and be on a fixed income for the rest of your life (which could be another 40 years) that one percent increase in the cost of living every year will consume your savings and could easily leave you with nothing before you die.

Not really. By your own admission, regulations are mandatory.
So, if I make an economy backed by granite (or carpentry) using regulations as rigorous as what is required for gold, it should work? How come nobody tried that? Maybe people make a big deal of gold for no reason?

Granite is too plentiful, as is wood. No good for currency.

And since nobody actualy uses gold in a transaction, what stops a greedy irresponsible governement to print more paper money than their gold can back?

That would be called Fractional Reserve Banking... which is very, very bad. I have written on this several times in this thread. You should either use gold/silver coins or gold/silver certificates that are 100% redeemable in gold/silver on demand. And people should routinely make such demands to keep whom ever is holding the gold/silver honest.

And then, for some reason, you decide that the exact same kind of regulations can't be applied to paper money.
But why? You already need regulations to stop gold from flooding/starving the market. What stops a responsible governement from applying similar regulations controling the amount of fiat paper money they print?

To kind of re-state what I said above: Fiat currency, unlike commodity currency, has no natural limits on how much can be created; it encourages reckless and wasteful spending. It promotes the creation of more and more government bureaucracy and red tape.

It also makes men easier to corrupt as it allows a small handful of people the ability to create unlimited money at their whim.

No currency system is perfect because we as people are not perfect. Actual physical limits help keep men honest (can't spend what you don't have) and helps keep government more transparent (easier to follow the money when you are not just creating trillions yearly from nothing).

[georgie_leech]

Erys, you realise the bulk of gold production is not done by government sources, right? It's done by private companies. Either you're suggesting a government monopoly on precious metal production or a 100% tax on gold, which seems counter to your assertion that government intervention is bad.

[Cazero]

Granite is too plentiful, as is wood. No good for currency.

Just adapt the ratio of granite/money unit accordingly.
Anf if your actual issue is that granite is too easy to counterfeit, then we do as with gold : use paper money that are nothing but IOU X quantity of granite, lock all the granite that was arbitrarily decided to have value in bank vaults, and enforce regulations to ensure rich people sitting atop mountains of granite can't break the economy.
Money is not something magical. Money is not work or a product of work. Wether it is gold, granite or paper, money is an artificial value fabricated for the sole purpose of enabling trades by allowing everyone to gauge what they want to trade around that common value.

That would be called Fractional Reserve Banking... which is very, very bad. I have written on this several times in this thread. You should either use gold/silver coins or gold/silver certificates that are 100% redeemable in gold/silver on demand. And people should routinely make such demands to keep whom ever is holding the gold/silver honest.

I don't want to trade my money for gold. I don't like gold. I want to trade my money for stuff I would actualy use, like videogames (another form of pointless luxury). Why would I want to trade my money for a less practical money that would sit uselessly in my home until I bank it back for the money I spent to get it?
If the point is to regulate money, we have governements and laws to do that.

To kind of re-state what I said above: Fiat currency, unlike commodity currency, has no natural limits on how much can be created; it encourages reckless and wasteful spending. It promotes the creation of more and more government bureaucracy and red tape.

If you don't trust the people who give value to your money to not do stupid things with whatever process gives value to said money, wether or not there is gold backing that money should be the least of your concerns.

[martianmister]

Gold has real, physical constraints.

And we need physical constrains to constrain our ability to make currency, because?

[theNater]

No one has disputed this.

But in the end of the day only the final product matters. If you make a terrible table, busted hand or not, you won't get paid as much for it. Period.

But the plumbers who went to georgie_leech's house are producing the same product, yet getting paid differently. georgie_leech doesn't have a different plumbing system in the two cases; why the distinction?

[Rogar Demonblud]

And we need physical constrains to constrain our ability to make currency, because?

I don't know. But all the gold mined in human history could be melted down and poured into an Olympic size swimming pool with room left over. I wonder how Erys will react when someone like Elon Musk decides to send a robotic probe to the asteroid belt to grab a smallish rock that will triple that amount, then use those profits to go get some of the bigger ones.

Precious metals have value because they're pretty. Their worth is significantly less

[Grey_Wolf_c]

I don't know. But all the gold mined in human history could be melted down and poured into an Olympic size swimming pool with room left over. I wonder how Erys will react when someone like Elon Musk decides to send a robotic probe to the asteroid belt to grab a smallish rock that will triple that amount, then use those profits to go get some of the bigger ones.

Oh, no need to worry. Remember, Erys wants to stop all forms of loans, investments, etc. and destroy the modern first world economy. Musk wouldn't have got any of his businesses off the ground without Fractional Reserve Banking, and getting rid of it is the objective, so we can all go back to a world in which only the extreme rich have enough money to start new businesses, and they won't want to, since they will have more money than they know what to do with anyway. The rest of us can go back to starving like nature intended.

GW

[Peelee]

But in the end of the day only the final product matters. If you make a terrible table, busted hand or not, you won't get paid as much for it. Period.

....I think the situation is two tables, both of the same fine quality, but one made by a woodworker who has a broken arm. One takes more time and more work, but has the same value (As only final product matters).

[Erys]

Erys, you realise the bulk of gold production is not done by government sources, right? It's done by private companies. Either you're suggesting a government monopoly on precious metal production or a 100% tax on gold, which seems counter to your assertion that government intervention is bad.

I do. And while those are options, it seems another is simply allowing a government to buy it from various mining companies. The minting, however, probably shouldn't be done third party.

Still waiting to hear about that sewer scenario though...

Just adapt the ratio of granite/money unit accordingly.
Anf if your actual issue is that granite is too easy to counterfeit, then we do as with gold : use paper money that are nothing but IOU X quantity of granite, lock all the granite that was arbitrarily decided to have value in bank vaults, and enforce regulations to ensure rich people sitting atop mountains of granite can't break the economy.
Money is not something magical. Money is not work or a product of work. Wether it is gold, granite or paper, money is an artificial value fabricated for the sole purpose of enabling trades by allowing everyone to gauge what they want to trade around that common value.


I don't want to trade my money for gold. I don't like gold. I want to trade my money for stuff I would actualy use, like videogames (another form of pointless luxury). Why would I want to trade my money for a less practical money that would sit uselessly in my home until I bank it back for the money I spent to get it?
If the point is to regulate money, we have governements and laws to do that.


If you don't trust the people who give value to your money to not do stupid things with whatever process gives value to said money, wether or not there is gold backing that money should be the least of your concerns.

Paper, granite, wood, all too plentiful.

Means a government can spend recklessly and allows debasement of currency easier.

If gold was money, you would still be using your "money" for the things you want. Your things just wouldn't be constantly getting more expensive simply because the money supply is swelling at too fast a pace.

And we need physical constrains to constrain our ability to make currency, because?

If you don't already know the answer to this form my past post, read about the Weimar Republic and hyperinflation.

More money in the supply, the less individual notes are worth. Inflation is literally the loss of buying power.

But the plumbers who went to georgie_leech's house are producing the same product, yet getting paid differently. georgie_leech doesn't have a different plumbing system in the two cases; why the distinction?

If the job is the same, they get paid the same. My example was two different jobs which take different amounts of time and materials to complete.

Not sure where the disconnect is, but I am sure we can get through it.

Oh, no need to worry. Remember, Erys wants to stop all forms of loans, investments, etc. and destroy the modern first world economy.

When have I ever said this?

Pro-tip: its better to keep your mouth shut in matters you don't understand than to make false accusations.

If/when man decides to mine asteroids, good! There is nothing wrong with this and is completely supported within the framework of intrinsic currency.

....I think the situation is two tables, both of the same fine quality, but one made by a woodworker who has a broken arm. One takes more time and more work, but has the same value (As only final product matters).

That's probably a better way of saying it. And correct!

[Grey_Wolf_c]

Oh, no need to worry. Remember, Erys wants to stop all forms of loans, investments, etc.

When have I ever said this?

Here:

What you are describing is called Fractional Reserve banking. It always leads to fiat, which leads to fractional reserve fiat banking. True intrinsic wealth people oppose such shenanigans.

and here:

That is a core point of mine. Other items, goods, services all require work to create. Money should mirror that.

Work for work. Not work for an IOU.

Loans "create" money. Even if you pass some law forbidding any fractional reserve (and immediately crashing the economy in the process), what the bank gives you is not actual money, it is an IOU from the loanee to the bank. Those IOUs then are used by the loanee to pay for work. But as per your words, we should refuse to be paid with IOUs. Therefore, in this brave new world of yours there are no loans, because even if granted, no-one will take your loan, since they are merely IOUs.

QED

Grey Wolf

[Erys]

Here:

and here:


Loans "create" money. Even if you pass some law forbidding any fractional reserve (and immediately crashing the economy in the process), what the bank gives you is not actual money, it is an IOU from the loanee to the bank. Those IOUs then are used by the loanee to pay for work. But as per your words, we should refuse to be paid with IOUs. Therefore, in this brave new world of yours there are no loans, because even if granted, no-one will take your loan, since they are merely IOUs.

QED

Grey Wolf

LOL@ immediately crashing the economy. Too funny man. Thanks.

But really, you don't need to have Fractional Reserve banking to allow a bank to loan money. You just need to separate activities. A 'savings bank' that holds peoples money (probably for a fee) and 'lending banks' where loans and such are done.

Loans that come from the banks coffers and is delivered in an intrinsic method. Fractional reserve banking is not required, and (imho) should be avoided if you hope to maintain any integrity to a monetary system.

[The MunchKING]

If you don't already know the answer to this form my past post, read about the Weimar Republic and hyperinflation.

That was Pre-Nazi, but Post WWI era Germany right? From what I heard they intentionally torpedoed their currency because the war debts they were ordered to pay for WWI were explicitly set in Duechmarks, not Francs or some other government's currency, so they basically intentionally drove down the Duechmarks' value so they could pay off the debt without having to give up much in the way of resources.

In other words, it's an aberration, and not the standard result of Fiat Currency.

Any government that wasn't already circling the drain would have a better grip on their currency.

But really, you don't need to have Fractional Reserve banking to allow a bank to loan money. You just need to separate activities. A 'savings bank' that holds peoples money (probably for a fee) and 'lending banks' where loans and such are done.

Loans that come from the banks coffers and is delivered in an intrinsic method. Fractional reserve banking is not required, and (imho) should be avoided if you hope to maintain any integrity to a monetary system.

How would lending banks GET the money to lend out if they don't have people's savings?

[Ron Miel]

Some people on this thread really ought to know their limits.

[Erys]

That was Pre-Nazi, but Post WWI era Germany right? From what I heard they intentionally torpedoed their currency because the war debts they were ordered to pay for WWI were explicitly set in Duechmarks, not Francs or some other government's currency, so they basically intentionally drove down the Duechmarks' value so they could pay off the debt without having to give up much in the way of resources.

In other words, it's an aberration, and not the standard result of Fiat Currency.

Any government that wasn't already circling the drain would have a better grip on their currency.

There are a myriad of recent examples of currencies collapsing.

Three since the turn of the century.

How would lending banks GET the money to lend out if they don't have people's savings?

Bankers are millionaires, billionaires. If you want to be a private lending institution why shouldn't it come out of pocket?

IN that vein of thinking, public lending institutions would run the same way. Should the public demand such a mechanism- there should be a literal pile of gold/silver which is the exact limit which can be lent. All interest collected over cost go back to the government funds for projects.

[Grey_Wolf_c]

LOL@ immediately crashing the economy. Too funny man. Thanks.

You find funny the idea of getting rid of the FRB, which is currently the base of the world economy.

That really says everything about your position, if you think you can simply laugh its issues away. Do you even know how much of the current world currency is fractional?

But really, you don't need to have Fractional Reserve banking to allow a bank to loan money. You just need to separate activities. A 'savings bank' that holds peoples money (probably for a fee) and 'lending banks' where loans and such are done.

Loans that come from the banks coffers and is delivered in an intrinsic method. Fractional reserve banking is not required, and (imho) should be avoided if you hope to maintain any integrity to a monetary system.

Where would the loan bank get its money from? Because presumably investors would give their money to the loan bank... but that would make it the savings bank.

At the same time, why would anyone give its money to the savings bank?

And of course, this continues to hand-wave the real issue: we have historical proof of what the economy looked like pre-FRB. Why would anyone want to go back to it is beyond me.

Bankers are millionaires, billionaires. If you want to be a private lending institution why shouldn't it come out of pocket?

Because the loan bank isn't allowed to take people's money, by your own rules.

There are a myriad of recent examples of currencies collapsing.

Three since the turn of the century.

So not that many have failed. Sounds better than the failure rate of gold-backed currencies, which is 100%. No true gold-backed currency lasted more than a couple of generations.

GW

[georgie_leech]

Erys, you seem to misunderstand the objection about gold mining. If there is a greater supply, the value of the gold currency you use drops along with the value of the gold it's made of. Unless you define the value of the currency to have a specified worth, as if by... fiat. But anyway...

Still waiting to hear about that sewer scenario though...

Been trying to track down primary sources on gold production during the 1800's, to not just respond with some of the construction details. But as the only source I've been able to locate is in an out-of-country library without an online version apparently available...

Between the main sewer systems and the connecting pipes, the London sewer system alone involved more than 20000 km of pipes, enough to stretch halfway around the world. 318000000 (yes, 318 million) bricks were laid, over one and a half million tons of concrete was poured, and 2.7 million cubic meters of earth had to be excavated. Even assuming it was all loose soil (it wasn't), that's over 3 million tons of earth. It took over 6 years to complete, and maintenance, expansions, and upgrades are ongoing. To say nothing of the price of labour nor the economic costs of having a major metropolitan area constantly under construction for half a decade.

To be clear, this isn't every British sewer system. This is just the capital city.

Paul Bairoch estimates the GNP of the UK back in 1860 to be about 16 billion 1960's American dollars . Not how much cash the government had available, but the total economic output of every british citizen and company across the world. Remember "The Sun Never Sets on the British Empire?" Under your system, you need the literal currency to pay for this; banks can't give loans, because they need to keep their currency on hand in case everyone everywhere withdraws everything they deposited there. To add insult to injury, this is shortly after the Opium Wars, which were precipitated in part due to the economic disruption from British Silver flowing out of the country to pay for tea. They were facing a shortage of precious metals. Tell me, do you think they produced enough literal gold to pay for all this without bankrupting the nation?

You can't argue "stuff was cheaper" back then, because the gold you would pay for it with was cheaper too; it has less value.

EDIT: Apparently the thread moved while I was typing. You know, your idea of setting money aside to lend out isn't a bad one. In fact, that's already done, partly to act as a cushion against the risks of FRB. Most countries have them now, and they're called Lender's of Last Resort: A bank to loan money to other banks in case of a run.

[Erys]

You find funny the idea of getting rid of the FRB, which is currently the base of the world economy.

That really says everything about your position, if you think you can simply laugh its issues away. Do you even know how much of the current world currency is fractional?

FRN

It is not the only world reserve currency.

And of course I do. A major reason I support intrinsic wealth in fact. Its asinine.

Where would the loan bank get its money from? Because presumably investors would give their money to the loan bank... but that would make it the savings bank.

A loan bank would be one or many people pooling an amount of resources with the intention of lending it out at interest. Aka: a lending institution.

A savings bank would basically be a vault.

Two completely different entities governed by different rules.

At the same time, why would anyone give its money to the savings bank?

Theft prevention mostly.

And of course, this continues to hand-wave the real issue: we have historical proof of what the economy looked like pre-FRB. Why would anyone want to go back to it is beyond me.

FRN.

Here is a list of over 20 fiat currency crashes going back around 100 years. We have 2 examples in this thread of gold failing as a currency- one involving a massive influx of new gold, doubling the supply in an instant (like fiat can/does) and crashing it (like fiat will); and Rome when it was under some pretty severe outside forces AND the government/banks(probably even some people) were debasing their currency from the inside.

Do you know of many others?

So not that many have failed. Sounds better than the failure rate of gold-backed currencies, which is 100%. No true gold-backed currency lasted more than a couple of generations.

GW

I'm calling shenanigans on that.

Erys, you seem to misunderstand the objection about gold mining. If there is a greater supply, the value of the gold currency you use drops along with the value of the gold it's made of. Unless you define the value of the currency to have a specified worth, as if by... fiat. But anyway...

***
...banks can't give loans...

***
You can't argue "stuff was cheaper" back then, because the gold you would pay for it with was cheaper too; it has less value.

Its doesn't matter what you use as currency- the more the units the less it is worth. So yes, as you slowly add gold to your economy its overall buying power is reduced. This is universal and I have never said otherwise.

But remember that earlier part about population? If you are adding new coins at roughly the same rate as people are coming into the world- you should be pretty balanced. Heck, gold might even allow for some deflationary periods. Something never seen in fiat.

***
Bankers are millionaires, billionaires. If you want to be a private lending institution why shouldn't it come out of their pocket? And if you can't borrow from those banks, there are allied countries you could turn to.

There is no reason to break your currency.

***
So long as supply's are stable, stuff retains roughly the same worth throughout time. Inflation makes it seem like goods were "cheaper" then and "more expensive now" but really- the script you are using simply has less purchasing power and you need more of them to buy things.

Look at the dollar value of gold verse oil through out those early years. There is a very significant event that happens in 1933, another in the 70's. From the 1800's up till then prices seem very steady.

[georgie_leech]

I'm calling shenanigans on that.

The Stone age lasted for thousands of years; does that make it a superior alternative to steel? And "This coin is 2600 years old" is not the same as being usable currency for 2600 years.

[woweedd]

FRN

It is not the only world reserve currency.

And of course I do. A major reason I support intrinsic wealth in fact. Its asinine.



A loan bank would be one or many people pooling an amount of resources with the intention of lending it out at interest. Aka: a lending institution.

A savings bank would basically be a vault.

Two completely different entities governed by different rules.



Theft prevention mostly.


FRN.

Here is a list of over 20 fiat currency crashes going back around 100 years. We have 2 examples in this thread of gold failing as a currency- one involving a massive influx of new gold, doubling the supply in an instant (like fiat can/does) and crashing it (like fiat will); and Rome when it was under some pretty severe outside forces AND the government/banks(probably even some people) were debasing their currency from the inside.

Do you know of many others?



I'm calling shenanigans on that.




Its doesn't matter what you use as currency- the more the units the less it is worth. So yes, as you slowly add gold to your economy its overall buying power is reduced. This is universal and I have never said otherwise.

But remember that earlier part about population? If you are adding new coins at roughly the same rate as people are coming into the world- you should be pretty balanced. Heck, gold might even allow for some deflationary periods. Something never seen in fiat.

***
Bankers are millionaires, billionaires. If you want to be a private lending institution why shouldn't it come out of their pocket? And if you can't borrow from those banks, there are allied countries you could turn to.

There is no reason to break your currency.

***
So long as supply's are stable, stuff retains roughly the same worth throughout time. Inflation makes it seem like goods were "cheaper" then and "more expensive now" but really- the script you are using simply has less purchasing power and you need more of them to buy things.

Look at the dollar value of gold verse oil through out those early years. There is a very significant event that happens in 1933, another in the 70's. From the 1800's up till then prices seem very steady.

Yes, your idea works...As long as supply remains stable, which is by no means a guarantee. With fiat currency, you can ensure that the growth of the economy and the amount of currency in circulation keep pace. You're making our arguement for us.

[Grey_Wolf_c]

Here is a list of over 20 fiat currency crashes going back around 100 years.

Which means that all the others have not failed in the last 100 years - and there is hundreds of fiat currencies. Much better rate than gold-backed, which became adulterated fiat-in-all-but-name in half that time.

You cannot both decry adulterated coins and then count them towards the length of time gold-backed currency lasted. The Romans began adulterating their coins before they even created the Empire. In fact, except for the post-Constantinian coins (which again, didn't last long), I don't actually know that the Roman civilization ever had true gold coins.

We have 2 examples in this thread of gold failing as a currency- one involving a massive influx of new gold, doubling the supply in an instant (like fiat can/does) and crashing it (like fiat will); and Rome when it was under some pretty severe outside forces AND the government/banks(probably even some people) were debasing their currency from the inside.

Do you know of many others?

All of them. Every single gold-backed currency became adulterated in short order, or fell back on promissory notes. You think it was all pure gold coins everywhere? As I said, I have a bridge you may be interested in.

I'm calling shenanigans on that.

Shiny. Proves nothing. How long did the government that casted that coin actually continued to print pure ones? How soon did they start mixing in other metals, once their economy grew past the amount of gold they had? Anyone can print one pure gold coin once. It's sticking to that that proves impossible.

But I grow tired of explaining reality to you. Answer those question or don't - my points have been made and you are happy to say that the terrible consequences of limiting the money supply is what you want. Reality is that your ideas are catastrophic in practice, because governments of all stripes have tried and failed to run economies under true gold backing. And returning to it in the current day would be literally impossible, and would destroy the ability of economies to grow, by design. You WANT, by your own admission, to limit the growth of any economy to what can be mined, even though the economic growth that has given us the information age depended on quadratic growth, instead of the paltry incremental allowed by gold mining. If it were up to you, we'd still be in a pre-industrial economic growth curve.

Grey Wolf

[Erys]

The Stone age lasted for thousands of years; does that make it a superior alternative to steel? And "This coin is 2600 years old" is not the same as being usable currency for 2600 years.

We are comparing currencies, not tools. And the facts are on my side, intrinsic currencies tend to be much longer lasting than their fiat counter parts. But, yes, I do agree- the authors claim of 2600 year stability based on the age of a coin was not good. However, there are many empires that lasted several hundred years with gold and silver as their currency.

Yes, your idea works...As long as supply remains stable, which is by no means a guarantee. With fiat currency, you can ensure that the growth of the economy and the amount of currency in circulation keep pace. You're making our arguement for us.

No fiat currency matches its population. It is designed to create booms and overspends, always. Just look at the debt clocks from around the world; those numbers are going up WAY faster than their respective populations. And their buying power is dropping in kind.

[Erys]

Which means that all the others have not failed in the last 100 years - and there is hundreds of fiat currencies. Much better rate than gold-backed, which became adulterated fiat-in-all-but-name in half that time.

You really just like making things up...

There are only what, ~160 countries in the world. Unless you are counting Disney dollars and arcade tokens there are not 'hundreds'.

And lets take it a step further. Of the last two hundred years, the longest lasting fiat currency is the US and Britain, and they have only been fiat for about 45 years. Until the 1970's both had ties to intrinsic wealth.

I grow tired of this with you and am not going to correct your many fraudulent claims as they give me quite a headache. Your constant misrepresentation of reality and false accusation of intrinsic currency have no place in civilized discussion.

[georgie_leech]

Erys, do you know why the money supply grows in such a way as to create a bit of inflation over time?

[Erys]

Erys, do you know why the money supply grows in such a way as to create a bit of inflation over time?

A bit?

I show you a chart where silver certificates could buy roughly the same amount of core commodities over the course of a hundred years; and you call 486% inflation in the last 45 years "a bit"?!? What $20 bought in '73 costs over $100 today. And spending/money creation is only increasing...

Yeah, I understand all to well how inflation works mate. My hope is you will too at the end of this discussion.

[georgie_leech]

A bit?

I show you a chart where silver certificates could buy roughly the same amount of core commodities over the course of a hundred years; and you call 486% inflation in the last 45 years "a bit"?!? What $20 bought in '73 costs over $100 today. And spending/money creation is only increasing...

Yeah, I understand all to well how inflation works mate. My hope is you will too at the end of this discussion.

And I showed you the table that shows how our wages have kept pace. So when our wages keep pace with inflation, it stays in balance. Ish. You see, what that inflation does is incentivize spending over hoarding or saving. That means people invest, which encourages growth; that leads to more businesses, new products, new innovations that make our lives better and easier (even as we use that free time to cram more work in) It's better to be a poor person today than it was to be a rich person 500 years ago.

[The MunchKING]

You really just like making things up...

There are only what, ~160 countries in the world. Unless you are counting Disney dollars and arcade tokens there are not 'hundreds'.

196 widely recognized ones, According to Google.

Assuming they all used fiat currency, I would use "Hundreds" to describe 1.96 hundreds of countries. It may or may not be strictly speaking correct, but I would use the word that way.

[2D8HP]

I tried to resist this thread!

But the plumbers who went to georgie_leech's house are producing the same product, yet getting paid differently. georgie_leech doesn't have a different plumbing system in the two cases; why the distinction?

As a working plumber maybe I can shed some light on this, typically problems from the users point of view can be rounded to three problems:

Leaks,

Clogs,

Lack of water pressure

When I get a service order, I have a guess on what time it will take, but I have enough experience to know that the same description of a problem may take seconds or days to fix, and often you don't know until work is started, and you really don't know how long it will take until the work is done.

Few wanf to risk paying by the hour, because they don't want to wind up paying for days of labor, just to get the chance to be the one who's problem only takes seconds to fix. Since you try actually earn a living at this, effectively customers who's problems take a short time to solve are subsidizing those who's problems take a long time to solve.

Iceland! Currency! Yeah!

By the way, since I no longer am in private industry, and I'm employed by the City and County of San Francisco, when people talk about "the government", I take it personally.

Also, I hate plumbing work.