A Message To All Libertarians, Anarchists And Even Some Conservatives.

[RichardY]

The modern day is a little different, as there is no gold-standard; currencies aren't backed by anything.

 

Yes they are, they are backed by the USD, which has World Reserve Currency status.

 

The foreign exchange market still exists. So if US Company pays CAN Company in USD, CAN Company can simply go to the foreign exchange and turn their USD into CAD. In the event that there isn't enough currency available on the foreign exchange, CAN Company can go to the Canadian Central Bank and exchange the money there. In this case, the Canadian Central Bank prints/creates new money to do the exchange, then holds USD on reserve, because they aren't able to print/create their own. 

 

Now you asked specifically about the US government: "how was and is the USA supposed to settle balance of payment issues with other countries being a debtor nation?" The US has the option to use commodities, of which oil certainly could be one of them, but the US can pay same way that international companies pay each other: by making stuff up at the printing press and trading on the foreign exchange.

 

If they are making stuff up then they are not paying each other. Oil is often priced in USD or EURO's, which gives the United States or Europe the chance to buy up commodities before inflation in commodity prices. They can only do this with countries like Saudi Arabia because they back the regime with weapons. If like Gaddafi they choose to take payment in Gold, well after shaking his hand and releasing the Lockerbie Bomber....

 

As you quoted from Carroll Quigley "Bills of exchange" were often used as claims against the assets of the other person, which may fluctuate on the foreign exchange market. The Government alternative would be the sale of monopolies to foreign creditors, as is happening with Nuclear Power in the UK and mid-west solar power in the USA. Eventually though the government is going to run out of assets to plunder.

 

I really don't understand what's being misunderstood here. The fact that I can use US dollars to pay taxes, and thereby prevent the violence of the state from seizing my property or throwing me in prison, makes US dollars VERY valuable to me. My preferences don't really matter.

 

But you haven't prevented the seizure of your property. The fact something is demanded through violence does not provide value to it. People in the government can demand all the Gold and bits of paper in heaven and Earth, but it isn't going to provide value to it. Paying taxes out of desperation, for potential future freedom maybe a good idea, the Soviet system could not function without gulags.  

 

 

[neeeel]

 

Yes they are, they are backed by the USD, which has World Reserve Currency status.

 

 

 

If currencies are backed by USD, and USD is backed by nothing then ?????

[RichardY]

If currencies are backed by USD, and USD is backed by nothing then ?????

The USD is backed by oil,  who ever gets hold of the US dollars first gets to buy commodities first before inflation sets in. Even something like Bitcoin could be said to be measured against the USD, most people want to pay the lowest price they can quality being equal. Maybe there is a local currency somewhere that only has value in its region, but I think that's pretty rare most people need oil in one form or another. How many people would prefer to take USD in Africa or S.America rather then their local crap currency.

[shirgall]

If currencies are backed by USD, and USD is backed by nothing then ?????

 

The currency is backed by being the only way to legally pay US taxes and the only tender used by the US government to buy goods and services.

[Dylan Lawrence Moore]

The currency is backed by being the only way to legally pay US taxes and the only tender used by the US government to buy goods and services.

 

Ding!

[RichardY]

The currency is backed by being the only way to legally pay US taxes and the only tender used by the US government to buy goods and services.

How is economic price calculation performed then? 

[shirgall]

How is economic price calculation performed then? 

 

Individually.

[RichardY]

Individually.

Based on, subjective preferences?

 

How would a project such as an oil rig or mine be calculated to be potentially profitable?

 

If the USD is backed by taxes, does the USA have the tax base to cover foreign debt obligations? If not, then how is it backed by taxes.

[shirgall]

Based on, subjective preferences?

 

That's exactly how prices are determined: What am I willing to give to get what I want?

 

And, amazingly enough, both sides of free transactions come out with more they went in with.

[RichardY]

That's exactly how prices are determined: What am I willing to give to get what I want?

 

And, amazingly enough, both sides of free transactions come out with more they went in with.

So taxation is not subject to economic price calculation, but central planning? There is a concept called the "Laffer Curve" that beyond a certain  marginal tax rate, tax revenues are greatly reduced. For example if particular marginal tax rates for various industries were at 90% as they were during WW2 then tax revenue in that area, was and would be probably greatly reduced. As a whole therefore, if the dollar is backed by taxes, there would be a particular marginal tax rate beyond which people would probably opt for leisure then work or the black market. With the end result being that taxes would have to be reduced or more draconian measures taken to maintain the size of the state. Beyond what tax rate does the USD cease to be viable or is it backed by tax at all levels of taxation.   

 

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A thought occurred to me of the concept of exclusivity. The Swiss Franc is often seen as a stable currency, perhaps this in partial due to some of the exclusive Swiss companies such as Rolex, Victorinox  and probably some other very high tech manufacturing ones. Perhaps there is some exclusivity in "good" products only offered in bitcoin somewhere.

[shirgall]

So taxation is not subject to economic price calculation, but central planning? There is a concept called the "Laffer Curve" that beyond a certain  marginal tax rate, tax revenues are greatly reduced. For example if particular marginal tax rates for various industries were at 90% as they were during WW2 then tax revenue in that area, was and would be probably greatly reduced. As a whole therefore, if the dollar is backed by taxes, there would be a particular marginal tax rate beyond which people would probably opt for leisure then work or the black market. With the end result being that taxes would have to be reduced or more draconian measures taken to maintain the size of the state. Beyond what tax rate does the USD cease to be viable or is it backed by tax at all levels of taxation.   

 

---------

 

A thought occurred to me of the concept of exclusivity. The Swiss Franc is often seen as a stable currency, perhaps this in partial due to some of the exclusive Swiss companies such as Rolex, Victorinox  and probably some other very high tech manufacturing ones. Perhaps there is some exclusivity in "good" products only offered in bitcoin somewhere.

 

Taxation is determined by pushing it as far as they can to maintain a level of consent. Still determined by individuals.

[Dylan Lawrence Moore]

If the USD is backed by taxes, does the USA have the tax base to cover foreign debt obligations? If not, then how is it backed by taxes.

 

The USD is not backed by taxes. It is backed by nothing. The act of taxation gives otherwise meaningless paper and digital tokens value.

[RichardY]

So taxation is determined by consent?

[shirgall]

So taxation is determined by consent?

 

What the market can bear, so they say.

 

when I moved from the bottom of Washington to near Seattle my sales taxes went up 25% and property taxes went up a similar amount (although I rent up here). It was shocking the general difference in retail demeanor for such a seemingly small difference. Taxes change very slowly so no one senses the shock that I did.

 

Property taxes were hiked around me in the recent election. It was a close change, but it passed.

[DaVinci]

What I still don't get is why invest in gold when you could invest in the stock market, or go to Vegas to keep the value of your money? 

[shirgall]

What I still don't get is why invest in gold when you could invest in the stock market, or go to Vegas to keep the value of your money? 

 

I don't think anyone advocates investing in any single thing. It's always a mix. You always hedge against one form or another of investment failing utterly. Investment isn't just assets, also. It's skills. Friends. Family. Location. Situation.

[DaVinci]

I don't think anyone advocates investing in any single thing. It's always a mix. You always hedge against one form or another of investment failing utterly. Investment isn't just assets, also. It's skills. Friends. Family. Location. Situation.

 

Sure, I've seen very rich people who have a varied portfolio including gold, but the message here is that fiat money isn't money. Gold is money. 99% of people who make this type of thread bring up that you can't go into a grocery store with a lump of gold and buy food, which is true. I'm sure there is probably an exception or two out there, but the norm is paper money gets you products. So if gold is just a way to retain value then why not play the stock market? Because that too would disappear if the economy tanked? 

 

I know some people would say that if the economy went under gold would become useable for barter, but I view this scenario the way I view the "if they drop an EMP on us I've got my non-electric car to drive into the mountains" scenario which is that being the only person to have gold is going to paint a huge target on your back. You don't need a non-electric car in the apocalypse, you need a non-electric helicopter so you can actually escape the mob. The same is true of having gold in the SHTF scenario. And no, "I've gotta gun to protect my stash" isn't a guarantee of anything. 

 

My point being, I see the value of gold in a completely civil society, but right now or if SHTF, it doesn't really make sense. 

[shirgall]

My point being, I see the value of gold in a completely civil society, but right now or if SHTF, it doesn't really make sense. 

 

SHTF currency? Alcohol, food, and cartridges.

[DaVinci]

SHTF currency? Alcohol, food, and cartridges.

So then I should be investing money into a supply of booze, bread, and bullets instead of gold?

[shirgall]

So then I should be investing money into a supply of booze, bread, and bullets instead of gold?

 

You might want to learn how, and build the capacity to, make booze, bread, and bullets...

[luxfelix]

Many people intuitively understand that there are forms of capital other than the most commonly discussed Mercantile Capital (also known as financial capital, money capital, etc.); that's what comes to mind when you mention skills, family, location (et al).

[Mister Mister]

You might want to learn how, and build the capacity to, make booze, bread, and bullets...

you can make bullets?

[Tyler H]

you can make bullets?

Yeah, lots of enthusiasts reload because it's cheaper. You could probably get set up for a few hundred bucks.

[Mister Mister]

Yeah, lots of enthusiasts reload because it's cheaper. You could probably get set up for a few hundred bucks.

Oh so you make them from used shell casings and gunpowder?  What do you use for the fresh rounds?

[Dylan Lawrence Moore]

Oh so you make them from used shell casings and gunpowder?  What do you use for the fresh rounds?

 

You cast your own lead into molds. You can buy bullet molds.

[shirgall]

you can make bullets?

 

I can make cartridges, but I know people that are casting bullets.

[DaVinci]

You cast your own lead into molds. You can buy bullet molds.

 

 

I can make cartridges, but I know people that are casting bullets.

 

What are you trying to tell me? ...That I can make bullets? 

 

Isn't it weird that you can make your own bullets but you have to wait 7 days to get a gun and even having a gun in your car in some states will get you arrested? 

[Tyler H]

What are you trying to tell me? ...That I can make bullets? 

 

Isn't it weird that you can make your own bullets but you have to wait 7 days to get a gun and even having a gun in your car in some states will get you arrested?

 

During the firearms safety course in my state they told us that if you have a shell casing in your possession without the license you get a one year mandatory sentence.

[shirgall]

During the firearms safety course in my state they told us that if you have a shell casing in your possession without the license you get a one year mandatory sentence.

 

Some states are better than others in many regards, gun laws are the most annoying patchwork of bizarre restrictions, fees, and requirements you can imagine.

[Tyler H]

Some states are better than others in many regards, gun laws are the most annoying patchwork of bizarre restrictions, fees, and requirements you can imagine.

The Concealed Carry Reciprocity Act should help with some of that, at least to allow travel between states with a firearm without wondering if there's some bizarre law you're suddenly breaking and could spend years in federal prison because you passed over an imaginary line. Funny that even with a republican house, senate, and president I'm not sure it'll pass.

[shirgall]

The Concealed Carry Reciprocity Act should help with some of that, at least to allow travel between states with a firearm without wondering if there's some bizarre law you're suddenly breaking and could spend years in federal prison because you passed over an imaginary line. Funny that even with a republican house, senate, and president I'm not sure it'll pass.

 

Concealed Carry, the $200 Suppressor tax and ban, are just small pieces of tens of thousands of regulations that are already on the books. There's still really evil stuff like the hollowpoint felony in New Jersey, and mandatory registration in some states...

[DaVinci]

The Concealed Carry Reciprocity Act should help with some of that, at least to allow travel between states with a firearm without wondering if there's some bizarre law you're suddenly breaking and could spend years in federal prison because you passed over an imaginary line. Funny that even with a republican house, senate, and president I'm not sure it'll pass.

 

If it doesn't then what does that mean about the power of government? You would think if anyone would pass that it would be Republicans who just happen to be in control of everything. 

[Tyler H]

If it doesn't then what does that mean about the power of government? You would think if anyone would pass that it would be Republicans who just happen to be in control of everything. 

I don't know if it says anything about the power of government, but I do think it speaks to the politicians incentives and agendas.  They are amoral, self-serving, power-seeking parasites who will say whatever needs to be said to gain power and do whatever needs to be done thereafter to maintain and expand that power.

 

 

Concealed Carry, the $200 Suppressor tax and ban, are just small pieces of tens of thousands of regulations that are already on the books. There's still really evil stuff like the hollowpoint felony in New Jersey, and mandatory registration in some states...

 

Yeah the hollowpoint ban and the other laws in the same vein are the ones that anger me the most.  It's obvious they have no idea what they are talking about and making laws anyway or they are exploiting the fact that their constituents have no idea what they're talking about.  Either way, pretty scummy behavior that can support my previous statement.

[shirgall]

Yeah the hollowpoint ban and the other laws in the same vein are the ones that anger me the most.  It's obvious they have no idea what they are talking about and making laws anyway or they are exploiting the fact that their constituents have no idea what they're talking about.  Either way, pretty scummy behavior that can support my previous statement.

 

I think the goal of the antis is to have enough gotchas to easily get casual gun owners in a bind, and inconsistency to make potential gun owners too daunted to want to do it. It's a battle of attrition. They don't own guns themselves, so they are unaffected. The ones that do have enough dedication or bodyguards to deal with the paperwork.

[Tyler H]

I think the goal of the antis is to have enough gotchas to easily get casual gun owners in a bind, and inconsistency to make potential gun owners too daunted to want to do it. It's a battle of attrition. They don't own guns themselves, so they are unaffected. The ones that do have enough dedication or bodyguards to deal with the paperwork.

Yes, I agree.