Bitcoin Forum

If the Fed says gold is an asset, then are bitcoins an asset?

http://blogs.forbes.com/afontevecchia/2011/07/13/bernanke-fights-ron-paul-in-congress-golds-not-money/

What Mr. Benanke doesn't realize is that money is also an asset. Gold is an asset and gold is money therefore gold is money. He is plainly stupid.

Gold isn't money because it was not issued by Mr. Benanke

Most money (currency) today is based on debt. Is debt an asset?

The debt is backed by collateral -- the citizens and their property supposedly.

wtf!?

people actually listen to osama bin bernanke?!

folks buy it and sell it, so i guess so.

This video is pure GOLD, people.  8)

http://www.youtube.com/watch?v=2NJnL10vZ1Y&feature=player_embedded (http://www.youtube.com/watch?v=2NJnL10vZ1Y&feature=player_embedded)

Ron Paul makes Bernanke look like a boy scout.

[quote author=smoothie link=topic=28629.msg360227#msg360227
What Mr. Benanke doesn't realize is that money is also an asset. Gold is an asset and gold is money therefore gold is money. He is plainly stupid.
[/quote]

Your logic does not follow. (A penny is a coin and a nickel is a coin, therefore, a penny is a nickel?)

Money is defined as the most marketable thing - the easiest thing there is to trade. Gold is not the easiest thing to trade. Just try bringing it to a business.

It can be money, a very good form of money. But it is not in our society.

Yes. A mortgage for instance, or CDOs.

So....what's wrong with saying gold isn't money?  Gold isn't money.  People don't exchange it for goods and services, people buy it (with actual money) and hold onto it.  Just like other assets, e.g. silver, oil, buildings, paintings, etc.

I know goldbugs love bashing the Fed, but this is just silly.

That's not the question. The question is why Mr. Bernanke wants it not to be money. That's not really a question either, but I digress.

I heard he doesn't want candy to be money either!  Why does he hate candy?  What's his angle???

And why do you think this is? Is he scared that we'll be walking around with nuggets of gold, a bag of shavings and a scale just to go buy a loaf of bread?

Another question is why you are claiming that Bernanke doesn't want gold to be money, when he never said that. All he said is that gold is not money. Neither is salt. It has been and it could be, but it currently isn't. Your assumption is probably right though, I don't think he wants gold to be money either. The reason is that it has been tried, and found to create a lot of problems that fiat doesn't have. Some would prefer those problems over those fiat creates, either because they think they are smaller, or because they pretend they aren't actually problems. They are apparently a minority in practically every part of the world, though.

You're kidding, right?

Bernanke has no right to issue money.
The only institute that has the constitutional right (and duty) to issue money, is congress.

This is the truth.
Afther more than 2 centuries the new elite has found a way to return the people to slavery and themselves to the parasites aka rulers.

WOW  :(

He's got such a poker face. Bernanke is a good liar.

Have you been to Utah recently? Gold is money.. and has been for the last 6000 years of our history, and somehow you know better?


What is money:
http://www.goldfreak.com/images/exter%20gold%20pyramid.png

I shouldn't jump into something like this, but I'm totally perplexed by your last post here.

I was in Utah last year.  I'm not sure if that qualifies as "recently" in your context since I don't have any idea what your context is.  Have they started paying for goods & services with gold coins there?  We used greenbacks when I was there.  Are they mining for gold?  How does Utah relate?
I'd suggest that there's universal agreement that gold has been held as an object of value fjor one reason or another for the last 6000 (or some number of) years, but I don't see how that makes it "money" today.
Finally, I have no idea of the point of your chart.  I see that it's got a rainbow of colors and is triangular, is this a gay thing?
These are all honest questions, I'm not trying to challenge anything (although I don't believe that "gold is money").

Utah House Passes Bill Recognizing Gold, Silver as Legal Tender

The Utah House was to vote as early as Thursday on legislation that would recognize gold and silver coins issued by the federal government as legal currency in the state. (AP)

Utah took its first step Friday toward bringing back the gold standard when the state House passed a bill that would recognize gold and silver coins issued by the federal government as legal currency.

http://www.foxnews.com/politics/2011/03/04/utah-house-passes-recognizing-gold-silver-legal-tender/


3 Tea Party-Backed Senators Bet Economic Recovery on Gold
Published July 07, 2011

AP
Shown here are Sens. Jim DeMint, left; Rand Paul, center; and Mike Lee.
With the economic recovery on life support, three Tea Party-backed senators are betting on gold to reverse the nation's fortunes.
Republican Sens. Jim DeMint of South Carolina, Rand Paul of Kentucky and Mike Lee of Utah unveiled legislation Tuesday that would keep Uncle Sam's hands off of gold and silver coins that have been declared legal tender by the government.
The Sound Money Promotion Act comes after Utah became the first state to recognize those coins as legal currency and exempted the sale of gold from the state capital gains tax.


Read more: http://www.foxnews.com/politics/2011/07/07/3-tea-party-backed-senators-bet-economic-recovery-on-gold/#ixzz1S5j74ZNA

A First Step To Sound Money
Editorial of The New York Sun | June 28, 2011
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Here’s a hypothetical situation. Suppose you had $1.5 million. At today’s gold price that would buy approximately 1,000 ounces of gold. Suppose now that President Obama, the Congress, and the Federal Reserve began managing the American economy in such a way that by the end of President Obama’s second term, the dollar was back to where it was when President George W. Bush began his first term. Were that to happen, your $1.5 million could purchase 5,660 ounces of gold.

So, do you think you should have to pay taxes on the increase in the value of your money?

http://www.nysun.com/editorials/a-first-step-to-sound-money/87411/


AND FINALLY:

Utah Spurs Gold Rush
by  Jeffrey Bell
07/14/2011

On June 2, hours after he presided over a ceremonial signing of Utah’s Legal Tender Act of 2011, Republican Gov. Gary Herbert was called by an out-of-state newsman for his comments on the day’s events.  Herbert sent word to the reporter that he is proud that Utah has emerged as “a leader in sound money policy.”

http://www.humanevents.com/article.php?id=44829

UTAH GOVERNOR SIGNS GOLD & SILVER LEGAL TENDER BILL!
Utah has now become the first State on our list to actually enact a sound money bill into law.

On Friday, March 25th, Gov. Gary Herbert signed HB 317, the "Utah Legal Tender Act," into law.

The law recognizes gold and silver coins issued by the federal government as legal currency in the state. The coins do not replace the current paper currency, but may be used and accepted voluntarily as an alternative.

The law exempts the sale of gold and silver coins from the state capital gains tax, since you would simply be exchanging one form of legal tender currency for another. It also calls for a committee to study alternative currencies for the State and a means for Utahans to pay their taxes with gold and silver coins.

http://constitutionaltender.blogspot.com/2011/03/utah-governor-signs-gold-silver-legal.html

THE BILL:

http://le.utah.gov/~2011/htmdoc/hbillhtm/hb0317s01.htm

BILL TEXT:
http://le.utah.gov/~2011/bills/hbillint/hb0317s01.htm

FIFY

So I'm sorry to burst anyone's bubble but gold is money and if you think it's not at least in Utah it's official that you are wrong.

Can you smash Bitcoin somwhere in the tip, just after the gold?

Probably right above gold and next to paper money.

Were tally sticks like a proto bitcoin of old? Just a bit of wood that had value really.

I know its wiki but its just a quick over view.
http://en.wikipedia.org/wiki/Tally_stick#Split_tally

Split tally

The split tally was a technique which became common in medieval Europe, which was constantly short of money (coins) and predominantly illiterate, in order to record bilateral exchange and debts. A stick (squared Hazelwood sticks were most common) was marked with a system of notches and then split lengthwise. This way the two halves both record the same notches and each party to the transaction received one half of the marked stick as proof. Later this technique was refined in various ways and became virtually tamper proof. One of the refinements was to make the two halves of the stick of different lengths. The longer part was called stock and was given to the party which had advanced money or (other items) to the receiver. The shorter portion of the stick was called foil and was given to the party which had received the funds or goods. Using this technique each of the parties had an identifiable record of the transaction. The natural irregularities in the surfaces of the tallies where they were split would mean that only the original two halves would fit back together perfectly, and so would verify that they were matching halves of the same transaction. If one party tried to unilaterally change the value of his half of the tally stick by adding more notches, those notches would not be on the other tally stick and would be revealed as an attempted forgery. The split tally was accepted as legal proof in medieval courts and the Napoleonic Code (1804) still makes reference to the tally stick in Article 1333. Along the Danube and in Switzerland the tally was still used in the 20th Century in rural economies.
[edit] Split tally in England

The most prominent and best recorded use of the split tally was in medieval England as a tool of the Exchequer for the collection of taxes by local sheriffs (tax farmers "farming the shire"). The split tally of the Exchequer was in continuous use until 1826. In 1834, the tallies themselves were ordered to be burned in a stove in the Houses of Parliament, but the fire went out of control, setting the building afire.

The system of tally marks of the Exchequer is described in The Dialogue Concerning the Exchequer (see external links below) as follows:

    The manner of cutting is as follows. At the top of the tally a cut is made, the thickness of the palm of the hand, to represent a thousand pounds; then a hundred pounds by a cut the breadth of a thumb; twenty pounds, the breadth of the little finger; a single pound, the width of a swollen barleycorn; a shilling rather narrower than a penny is marked by a single cut without removing any wood.

Royal tallies (debt of the Crown) also played an infamous role in the formation of the Bank of England at the end of the 17th century when these royal tallies, trading at a hefty discount of up to 60 percent, were engrafted into the Bank's capital stock.

Tally sticks feature in the design of the entrance gates to The National Archives at Kew.

the ben bernank looked he just swallowed a rat ... is gold money ... nup!

... but we got computer hard drives full of worthless CDO, FNM, FMC promises .... and theys really is good money cause we just printed up a $5.1 trillion storm in FRN against them ....

mwhhaaaaaaaaaa! the biggest poker bluff of the century so far, right there.

crazy times people.

I love when I go out to eat and pay the bill with a small piece of real estate, maybe tip an extra square foot section of a flag lot in Modesto if the service was good.  Or that time I went to the movies and paid the ticket guy with a couple of MUNI bonds.  Yes, it's all money.  Everything is money.  Dogs, pogo sticks, that full feeling after you eat a whole pie:  money.

And the fact that Utah has a goldbug-pandering state legislature doesn't change anything.  States have no rights to issue currency.  The bill simply said the state would recognize federally-issued gold and silver coins as legal tender.  Whoop-dee-fucking-do.  Walk into any store in Utah and try to pay for something with that Genuine Buffalo Head Gold Coin you bought from the late night TV infomercial.  Let us know how that works out for you.

Maybe if the universe revolved around Giraffe.BC I'd care what you think but since it doesn't..

And guess what the market disagrees with you and so do I. Have fun with your delusions!

I love bashing the Fed as much as any long bitcoiner, but really, I have to agree with Bernanke on this one. Do you think gold is money? No. Do you think T Bills are money? No, they're assets. This is true. We HOLD gold, we don't use them as a medium of exchange. We have and will, but today, we generally do not.

Thanks!  Maybe I'll go order a pizza and pay for it with a small business.  Small businesses are money after all.

And Congress has given that authority to The Fed

I agree, I think it's realistic to say anything of value is an asset, however, the liquidity of that asset is the real issue.  I can send Gold, BTC, a small business, and cash.  However, which asset is most liquid (or to say it another way) which asset is easiest to spend?

I think Utah accepting Gold and Silver as legal tender could be amazing for Utah residents, business and ... well everybody. If precious metal can be traded TAX FREE, then many businesses will HQ there (paying service and income tax), Utah could corner the otc trade. That's gotta be big business.

Ace.

Money is just an asset that is very liquid.  Federal reserve notes are very liquid, but they aren't necessarily assets.  Gold is an asset, but it isn't as liquid.

It's like saying a cocktail must be liquid and alcoholic.  Federal reserve notes are like 3.2 beer.  Gold is like jello shots.

That is not a "what is money" diagram, it's John Exter's inverted pyramid.  The pyramid has many layers of asset classes graded according to safety, from the safest and least prolific at bottom (gold) to the least safe and most prolific at the top (small business).   

The premise being that in a "flight to safety" scenario, people will rush down the pyramid towards ever increasingly safer but scarcer assets.

Under the bill, there is no state income tax on gold or silver transactions, but there is still federal tax.

Is there a federal tax specifically on gold and silver in the states?

It's exempt from capital gains, not income tax.

if bitcoin fails I will blame it on the early adopters being economically illiterate.  thanks for the laughs though.

Someone installed a tv aerial for me a few years ago and I bought a case of beer to pay them with.