The Federal Reserve
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Poll
Question: What is your opinion of the Federal Reserve?
#1
Very Favorable
 
#2
Favorable
 
#3
Mixed
 
#4
Unfavorable
 
#5
Very Unfavorable
 
#6
What the hell is the Federal Reserve?
 
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Partisan results

Total Voters: 24

Author Topic: The Federal Reserve  (Read 2452 times)
A18
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« on: December 06, 2004, 02:03:30 PM »

...
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Bono
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« Reply #1 on: December 06, 2004, 02:08:45 PM »

Totally unfavorable. I'm on favor of a decentralized currency, which would probabily consist of gold.
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A18
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« Reply #2 on: December 06, 2004, 02:21:32 PM »

Even though I'm for an unbacked currency, I acknowledge that it is probably illegal for the federal government to print bills that are not backed by gold or silver coins (or some other metal).

Furthermore, because the Federal Reserve as an institution is not necessary for carrying into execution the power to coin money, it is probably illegal as well.

A constitutional amendment should be passed authorizing an unbacked currency. The Fed should be abolished, and a two thirds majority in both houses required to expand the money supply.
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David S
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« Reply #3 on: December 06, 2004, 06:18:55 PM »
« Edited: December 06, 2004, 06:24:43 PM by David S »

The Fed is really a private banking cartel. The Fed creates money out of thin air and loans it out. They earn interest on the money that was created out of nothing. Thats a crooked deal to start with.
Also if someone defaults on the loan does the Fed get stuck for the loss? No way -they pass the loss on to the taxpayers. The local banks are protected by FDIC. Loans to foreign governments are also usually backed by U.S. government guarantees. So the taxpayer always gets stuck.
But it gets worse. The process of creating money out of nothing causes inflation. Since the fed was created in 1913 the dollar has lost over 90% of its value. Prior to that time inflation was nearly zero when viewed over long time periods. Generally there was only inflation during war time and prices came back down afterward.
Handing over the Feds job to congress doesn't seem like a good deal either. Can we expect congress to be fiscally responsible?
You may view the gold standard as archaic, but it forces government to be honest. As long as currency is either gold or 100% backed by gold, government cannot create it from nothing.
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A18
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« Reply #4 on: December 06, 2004, 06:58:42 PM »

If one day some Frenchmen "mined" $2 trillion out of the earth, how would you feel about that? They can now get $2 trillion dollars worth of productivity out of our economy without putting anything in! It's a scam!

Thankfully you can't "mine" dollar bills. You can, however, mine gold - and if you find gold, what you're getting away with is the equivalent of counterfeit. Not the moral equivalent, but the monetary equivalent: people's hard work and productivity in exchange for nothing.

I don't want people "counterfeiting" United States money. Gold can't be created, but what does that change when it appears out of nowhere. We, the People, cannot control how much gold is mined. Keep fundamental economics in mind also; we have to increase the money supply enough to keep pace with the number of goods and services. Under the gold standard, we the people are at the mercy of gold to do that for us.

Can gold do all that? I don't trust it, and I don't trust Congress; but do you trust Congress with the Constitution? In this country you need a two thirds majority to amend the Constitution. That's the ability to fundamentally change the way the country ticks.

Let's give the United States Dollar the same protection we gave those other important pieces of paper: a two thirds majority in our two chambers of Congress.
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David S
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« Reply #5 on: December 06, 2004, 08:09:52 PM »

Finding $2 trillion worth of gold is unlikely. Further there is sweat equity involved in getting the gold out of the ground, unlike printing dollars which requires nothing. It costs about 4 cents to print a bill and it doesn't matter what denomination.

Historically gold has held its value well. Someone once noted that in ancient Rome a finely made Toga with a belt and a pair of sandals cost about 1 ounce of gold. Today 1 ounce of gold is worth about $450, about the price of a nice suit with a belt and shoes. Thats price stability.
In the early part of the 20th century gasoline cost about 10 cents per gallon. Today its more like 2 bucks per gallon. But gasoline didn't become more expensive. The dollar became worth less.
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A18
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« Reply #6 on: December 07, 2004, 08:06:16 AM »

I'm just illustrating a principle. Dollars only we can create, so you have to put work in to get work out.

The cure for inflation is the abolition of the Federal Reserve. When Congress wants to make money out of thin air, at least the Representatives and Senators in question will be accountable to the people and public scrutiny.
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David S
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« Reply #7 on: December 07, 2004, 11:42:21 AM »

I'm just illustrating a principle. Dollars only we can create, so you have to put work in to get work out.

The cure for inflation is the abolition of the Federal Reserve. When Congress wants to make money out of thin air, at least the Representatives and Senators in question will be accountable to the people and public scrutiny.

I agree with you on abolishing the Fed, but I am not optimistic that congress would be responsible with the power to print money. Most governments that have gone the route of paper money ran into trouble. The temptation to make free money is just too great.
In theory you can run the government without taxes by just printing all the money you want. But the effect is very high inflation and that acts like a tax on any money you hold in your hand. The dollar you earned today may be worth only 50 cents in a year. But its always tempting to bureaucrats to just print money. That way they can fund all of their goofball programs without raising taxes. Most people don't realize that  policy destroys their savings so they don't get mad at the politicians.
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Colin
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« Reply #8 on: December 08, 2004, 09:45:12 AM »

I have to be favourable, my dad works there and has worked at the Fed for almost 30 years. I can't go against an institution that my family is connected with. Plus my sister works their and my cousin may get a jon there soon.
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StatesRights
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« Reply #9 on: December 08, 2004, 04:46:34 PM »

Why not back the money with Platinum instead of gold? It is far more valuable and you can ACTUALLY put together trillions in Platinum.
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David S
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« Reply #10 on: December 08, 2004, 07:08:34 PM »

Why would Platinum be better? I'm not necessarily opposed to the idea, but gold iand silver are the traditional standards for currency. Platinum is going for about $830 per ounce right now and gold is about $440. Whats the advantage?
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StatesRights
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« Reply #11 on: December 08, 2004, 07:28:11 PM »

Why would Platinum be better? I'm not necessarily opposed to the idea, but gold iand silver are the traditional standards for currency. Platinum is going for about $830 per ounce right now and gold is about $440. Whats the advantage?

I stated Platinum for the fact it's worth more and has a higher demand. And someone said earlier "You just can't dig 4 trillion dollars in gold out of the ground". I'm sure you can dig that much in Platinum.
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Bono
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« Reply #12 on: December 09, 2004, 02:42:48 AM »

Why would Platinum be better? I'm not necessarily opposed to the idea, but gold iand silver are the traditional standards for currency. Platinum is going for about $830 per ounce right now and gold is about $440. Whats the advantage?

I stated Platinum for the fact it's worth more and has a higher demand. And someone said earlier "You just can't dig 4 trillion dollars in gold out of the ground". I'm sure you can dig that much in Platinum.

You don't need to dig trillions of gold. YOu just need to value gold at a certain value that covers the curent money supply. For instance, for today's situation, it would take to value that gold at $4000 an ounce, or 0.00025 ounces per dollar.
The Myth of Insuficient Gold
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A18
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« Reply #13 on: December 09, 2004, 02:35:07 PM »

But what is the point?
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Bono
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« Reply #14 on: December 09, 2004, 04:54:09 PM »


The Case for a Genuine Gold Dollar, by Murray Rothbard

Gold And Economic Freedom, by Alan Greenspan

Keep in mind Greenspan never recanted any of the views expressed on that essay.
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A18
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« Reply #15 on: December 09, 2004, 04:58:49 PM »

What, in short, is the benefit?
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Bono
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« Reply #16 on: December 09, 2004, 05:02:23 PM »



No monetary inflation(except that made by teh increase of the amound of gold extracted, which is meaningless.)
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A18
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« Reply #17 on: December 09, 2004, 05:04:23 PM »
« Edited: December 09, 2004, 05:06:33 PM by Philip »

It's no more meaningless than government creating new money.

Also, government could just lower the amount of gold per dollar.

We need to have enough money to keep up with the goods and services, plus people shouldn't get productivity in exchange for a neat but useless metal.
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Bono
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« Reply #18 on: December 09, 2004, 05:12:58 PM »

It's no more meaningless than government creating new money.

It's much easier to create pieces of paper than to 'create' gold. Unless you believe in alchemy.

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Or we could privatize currency.

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SO, they should get productivity in exchange for neat but useless pieces of paper?

SO,
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A18
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« Reply #19 on: December 09, 2004, 05:20:29 PM »

Finding gold is just as inflationary as creating pieces of paper.

Pieces of paper can be used to control the money supply to keep up with the exchange of goods and services, and this way you can't just "find" it. Countries with large amounts of gold won't get productivity for nothing.
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David S
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« Reply #20 on: December 09, 2004, 06:24:33 PM »

Finding gold is just as inflationary as creating pieces of paper.

Pieces of paper can be used to control the money supply to keep up with the exchange of goods and services, and this way you can't just "find" it. Countries with large amounts of gold won't get productivity for nothing.
Philip doesn't it bother you that the Federal reserve creates money out of nothing and then collects interest on the money. That's a classic example of "productivity for nothing". It should bother you even more that the result of that process is the continuous erosion in purchasing power of the dollar. The Fed gets rich will you are robbed a little at a time every year.
Your concern about France or someone else digging up gold and causing inflation has not been demonstrated to be a big factor in history. The value of gold has shown incredible stability over long periods of time.
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A18
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« Reply #21 on: December 09, 2004, 06:27:28 PM »

I want to abolish the Fed as much as everyone else, but creating money out of thin air is necessary to keep up with the number of goods and services. Or else the value of the currency would go up over time.
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StatesRights
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« Reply #22 on: December 10, 2004, 12:57:52 AM »

I want to abolish the Fed as much as everyone else, but creating money out of thin air is necessary to keep up with the number of goods and services. Or else the value of the currency would go up over time.

That's the most hilarious thing I've ever read.
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A18
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« Reply #23 on: December 10, 2004, 12:49:17 PM »

In 1904, there are $5 billion in a country of 5 thousand people.

In 2004, there are $5 billion in a country of 5 million people.

You're trying to tell me that the dollar will not be worth more?
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David S
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« Reply #24 on: December 10, 2004, 03:10:29 PM »

In 1904, there are $5 billion in a country of 5 thousand people.

In 2004, there are $5 billion in a country of 5 million people.

You're trying to tell me that the dollar will not be worth more?

Draw your own conclusions:
http://oregonstate.edu/Dept/pol_sci/fac/sahr/pl1665.htm
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