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Author Topic: Dollar slowly collapsing  (Read 5042 times)
notme
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October 06, 2012, 05:12:24 PM
 #41

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We will have falling wages, but purchasing power per dollar will increase.
why would purchasing power per dollar increase due to inflationary policies? Even with real economic growth, purchasing power per dollar falls due to inflation

Because, as I already stated, the deflationary pressures are stronger than the actual effects of the policy due to the fact that the printed money only goes to the financial sector and they are hording it.

https://www.bitcoin.org/bitcoin.pdf
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BobbyJo
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October 07, 2012, 06:02:49 PM
 #42

Why is it when shit hits the fan ppl still race to the dollar?
Because the fiscal disasters in other large economies are even worse.

When the shit hits the fan people race for what they know.  Gold, silver, other precious metals and possibly BTC this time round.  If we are lucky.  Its just a matter of time and how deep the depression will be!!

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October 08, 2012, 03:09:43 AM
 #43

2) Announce a new currency which will be backed with a basket of items such as Oil, Gold, Silver, Platinum, Lithium, etc...

You do know the entire point of backing a currency is that when currency is transferred from one country to another.. the actual physical good backing it is transferred as well?

That is why a gold backed currency isn't even really possible or feasible for the US anymore. Back in the day the USD was pegged at say $35/oz. So if a company in say China had $3500 of our money, they could directly ask for 100oz of gold. And guess what.. there isn't infinate gold out there, eventually the US would 'run out' of money and our economy would shrink.

Just saying...

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DoomDumas
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October 08, 2012, 05:22:33 AM
 #44

Or maybe he's trying to soften the deflation.  Nothing kills a consumerist economy like falling prices.

This is only true for dept based currency, as the dollar and all other fiat currencies.  

This only applies to reality...

Not for gold or bitcoin  Wink

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Hunterbunter
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October 08, 2012, 05:55:42 AM
 #45

Money has been inflated since the dawn of time, and has been reset countless times by every culture. Every debt based fiat currency is heading the way of Zimbabwe, just at different speeds.

And as a matter of basic economic theory, a banana costing billions in Zimbabwe probably had more to do with the lack of bananas than the printing of more money. Printing money just gave the printers access to goods first.
mdude77
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October 08, 2012, 01:49:09 PM
 #46

The Federal Government is overspending by such a wide margin the only solution they have at this point is to devalue the dollar so the cost of borrowing does not collapse the welfare spending mountain.

The problem is so bad with excess federal spending that the only solutions we have at this point would be to cut spending across the board by 50%, raise taxes on every single person by 25%, confiscate wealth from the people in any way possible, or just default on the federal debt.

If we default on the federal debt the main group which will be crushed would be...The Federal Reserve.  The Fed has been putting so much federal debt on to its books that any change in the system at this point would really pound them.  If Ron Paul really wanted to "End the Fed", this would kill two birds with one stone.

1) Allow the Fed to buy U.S. debt back from foreign investors and don't sell any more debt outside the Fed.
2) Announce a new currency which will be backed with a basket of items such as Oil, Gold, Silver, Platinum, Lithium, etc...
3) Give everyone 1 year to exchange the old dollar with the new currency
4)  The Fed would take the loss from the currency devaluation and the federal debt.  This would end the Fed.

5) We start over.

I am not the Federal government.  I am a US Citizen.  As such, I am not responsible for reckless decisions, favoritism, payoffs, and endless wars the government of the country that I choose to inhabit chooses to fund by debt spending.  Therefore, I vote to solve the problem we:

1 - declare 99% of the federal government useless, unconstitutional, and dissolve it
2 - declare all debts incurred by said useless government null and void
3 - pass a law once again allowing anyone to create "money".  the market will quickly determine what is valid and valuable, and what isn't
4 - that will cause the so called federal reserve to quickly go bankrupt and out of business, because no one will want to use so called dollars (federal reserve notes)

That said, 99% of the world's problems are caused by corporations and governments.  Corporations and governments themselves are not mindless entities, they are run by people.  Therefore 99% of the world's problems are caused by people.  Until the mindset of people raises up and gets out of the petty egotistical power hungry greedy godless mentality that most live in, it doesn't matter WHAT economic structure, what government, what laws we have, we'll all end up in the same boat, different name.

M

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BobbyJo
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October 08, 2012, 09:11:18 PM
 #47

Nice try.  Now let reality have a chance!

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October 21, 2012, 03:19:20 AM
 #48

My bet : hyper-inflation disguised is occuring scince few year now.. Watch out those who have pilled lots of $ for their retirement !  They may discover that their purchasing power worth not an half they were anticipating.

At the rate currency are printed, specially the reserve one !
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November 22, 2012, 03:40:07 AM
 #49

We can't audit the Fed, so we can't prove they are insolvent.  They can continue to trade as if they are solvent and nobody can prove they don't have the funds to back up their positions.

The FED can never go insolvent because they create the money.


Just like in the Parker Brothers MONOPOLY game.

And yes, you're right, nominally, this is true, they can't go "insolvent".  In practice, though, they could print all the money in the world and still be unable to solve debts they must pay, because at some point everyone says "I don't want your monopoly money anymore, fuck you".  Hence, insolvency.
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November 22, 2012, 03:52:19 AM
Last edit: November 22, 2012, 04:05:29 AM by odolvlobo
 #50

We can't audit the Fed, so we can't prove they are insolvent.  They can continue to trade as if they are solvent and nobody can prove they don't have the funds to back up their positions.
The FED can never go insolvent because they create the money.

And yes, you're right, nominally, this is true, they can't go "insolvent".  In practice, though, they could print all the money in the world and still be unable to solve debts they must pay, because at some point everyone says "I don't want your monopoly money anymore, fuck you".  Hence, insolvency.

I think this is the scenario you are talking about: inflation finally starts to rise and the Fed needs to act, but it can't reduce the money supply because all the toxic assets that it bought have defaulted, nobody wants treasuries, and raising the reserve ratio will cause widespread bank failures. Hyperinflation follows.

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