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ORIGINAL: Termyn8or

Hons (et al of course), you seem to have inadvertently touched on the problem with buying silver. With the economy slowing to the rate it has, demand has not reached the levels predicted a couple of years ago. When it gets like this two factors screw it up. The speculators dump it and they have a chance to open up more mines.

Back to the subject though. I think the subject of any major changes in how money is issued etc. are almost a moot point. We are pretty much stuck with this system.

I asked this question in another thread concerning finances and gold and such. Does anyone know of any country where the money is actually backed by gold, or silver for that matter ? I can't think of one but I don't know. Right now I can't really think of a valid search string to use, say in Google to find out. I'll have to give that some thought.

I would tend to think that if any, there are very few, and those may be very tiny economies, island nations and the like. I don't think any major ecomony in the world actually backs it's currency with gold, but I could be wrong.

But being few and far between would seem to indicate that the gold standard is overrated. I know I have mentioned that if you put a million dollars in the bank and find it is only worth half that when you take it out, that you have been ripped off. But similarly, what if you had actual gold ? What if when you took your gold out and found it was worth only half what it was when you put it in ? It could happen.

Even when salt was used as money, it's value could fluctuate, who is there to say it can't. People also used to eat it and use it as a preservative as well as a few other things, making it a true commodity. That's one way to put it anyway. However if employees say that they simply need more salt or they can't work there, they would have to get a raise or move on to another job where they get more salt. Intrincisally this has to affect the value of salt. Even butchers, bakers and candlestick makers could decide to charge a few more grains for their goods.

So the point is, anything can change value. There are a plethora of factors that can cause this. Have more kids ? Need more food and diapers, or loincloths or whatever they had. Spend more salt. You a baker ? Well either you have to expand your business and work more or you have to charge a few more grains or whatever for each loaf of bread. These things are inevitable.

So since the value of anything will never be static, there is no sense in pretending. The solution is not to abolish the fed or any of that crap. society can't take that, plain and simple, the solution is to figure out how to manage this system more effectively.

The root of that problem is that they have created a very unpredictable system, there are simply too many variables. If this is assumed correct then the most logical solution seems to be to isolate or otherwise nullify some of these variables, or at least their effect.

To abolish the fed, something similar in function would have to take it's place. It would be ½ of one, six of another. Some "experts" actually say the fed should be nationalized, which will merely cause congress to have more direct control. We know how congress is, in fact I think even congress knows how congress is. So how valid of a solution is that ?

Change can only be so drastic. The base problem that caused this bunch of crap was not the direct result of having a fiat currency nor the issuance of credit in and of itself. It was the excessive use of credit. This should not have been allowed to happen. So they might have to make it happen by force of law, how else would they do it ?

That's where we are at. Things need to be rethought, just rethought by the right people this time around.

T

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ORIGINAL: UncleNasty

Isn't the FDIC also responsible for encouraging risky lending, and thus failure?

Uncle Nasty