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a new currency? - 12/21/2008 8:02:07 AM

LadyEllen

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Samboct brought this up and it would appear to be a realistic way out of the hole.

As I understand it, we make the current currency redundant and start with a new one which is valued at several factors different to the current, so reducing the hole from an unmanageable few quadrillions or whatever, to a more manageable few billions or whatever.

Lenders (including investors) and creditors lose out - but then as things stand they lose out anyway, and totally. This way they get something, even if its cents in the current dollar.

The problem as I see it though, is if the US did this, it would require that no other nation on the planet did it as well - if they did then the resulting revaluation as it related to their creditor amount would be affected. The money owed to them could be reduced by less (so not affecting the hole as much), cancelled out altogether (if their revaluation was similar) or even increased (if their revaluation was more drastic).

Am I thinking along the right lines here with the problem?

E

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In a test against the leading brand, 9 out of 10 participants couldnt tell the difference. Dumbasses.

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RE: a new currency? - 12/21/2008 8:11:00 AM

Raechard

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Maybe we could do the same with house prices i.e. people that own them have to sell them at a fraction of the price they bought them for, sound fair?

I think Zimbabwe have tried this altering the value of currency approach, I didn't really think Mugabe was an economic genius at the time.

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えへまにんへえや
Nobody wants to listen to the same song over and over again!

(in reply to LadyEllen)

Post #: 2

RE: a new currency? - 12/21/2008 9:02:34 AM

samboct

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Hi Lady E

Maybe I've read too much WWII history, but here's what I'm coming up with- and this is largely modeled on the steps that were undertaken in the Weimar Republic.

1) Fast inflation- basically the gov't begins printing money- or in this case, bailing out banks/finance houses- it's the same thing. This allows everyone to be made "whole" according to contracts etc. Basically we're "paying off" debts of expensive money with cheap money. It's also why a deflation leads to a depression- crushing debt burdens get even heavier as the money increases in value (price drops).
2) This includes foreign countries- so countries like China which hold much of our debt will find the paper valueless.
3) The US dollar as the principal global currency will be replaced by in all likelihood, the euro. However, lots of European countries also hold a lot of US treasury notes so the euro may take a hit as well compared to other currencies such as Swiss francs. Again, I'm guessing here.
4) In the US we're in for a rough ride because basically we won't have a working currency. It's the same problem as the Weimar republic or any other fast inflation- 1 dollar bills will have a little stamp on them that says 100,000 dollars one week and one million dollars the next. Barter will become important.
5) When the carnage settles, the Fed begins printing bluebacks or something that looks different from our current currency. I don't know if it's necessary that it be backed in gold or not.

There are a lot of unanswered questions such as - what happens to US backed pensions such as social security? How about stocks? Will there be a conversion between something like Series E bonds of old currency and new? (I'm picking Series E because IIRC, you're only allowed to buy $25k worth/yr.) What happens with taxes? 401Ks?

I must admit, this is a rather apocolyptic view of events. I don't see an alternative unless everybody is willing to write down large chunks of US backed debt willingly.

Also- I certainly don't have all the answers- I'm just trying to figure out a likely course of events given the hole we're in.

Sam

I.

(in reply to Raechard)

Post #: 3

RE: a new currency? - 12/21/2008 9:07:44 AM

celticlord2112

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quote:

Am I thinking along the right lines here with the problem?

No. Changing currency does nothing--debts are either paid or defaulted upon. If creditors get pennies on the dollar, they get that regardless of currency.

The "problem", such as it is, is a mountain of paper debt leveraging paper assets--neither debt nor asset exists in a tangible sense. No amount of currency juggling will change that.

The paper debt and the paper assets need to be tossed on the trash heap--and until that happens, the pain will continue.

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Post #: 4

RE: a new currency? - 12/21/2008 10:42:08 AM

pahunkboy

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I guarantee you it is coming...

I was thinking... they probably will find a way that the masses will have to pay the full amount of all of their debt.   but any earnings would be in the new currency.... I hear rumour 10 to 1. I also heard that $100 will be "checked"   for fakes, which means you turn them in, and then wait days or weeks to be processed.   being that the world has $100 bills en mass, the idea isnt so far fetched.

Lady E., a new currency is not a bad idea...IF the local governments coin it a fixed exchange with no private middleman.   That is what this financial mess is about.   the globalists want a 1 currency ....all electronic!    It is not worth fighting...as the dollar is past the point of return, and we the people will beg and DEMAND it!!

The elite is going for the kill.

There is danger in this.   if your debit card, the ONLY form of payment, tied to the social security number, (which the IMF bank already has on file) if for whatever reason your card doesnt work- there wont be the option to use another form of payment.

keep in mind tho- that it is not a slam dunk for the globalists. once the majority sees they have been robbed- there will be civil unrest.      take someones money and they get pissed off.   ..it ties in to terrorism. practically every terrorist group had the money swindled from them.   it is quite simple really.
the exception would be maybe a fight over a girl.

when things get ugly- well even now- the idea is to be gracious, but to not participate in any of the grid as possible.... Jenny doesnt use banks. The whole 20 years I know her. She gets money orders.   The banks HATE people like her!!! She has never ever had a bank "fee"!   Her bills are up to date..she puts cash in each envelope for each bill for the month.

people are taking down cameras, ....and oh, NEVER EVER agree to be chipped!!!!    the police will be... the body is an electric current... so a planned wave length can change a person!!    ...along with neuro lingusitc programing on the TV set.   the news host says, "are you sugesting widgets are blue", the guest babbles on how widgets are blue.   your eyes shift from left to right, after hearing the magical woord hypmotitsts use, "suggest".

...my brother is fed up with me.   when the governent tells him his 400k in bonds will be paid 90 cents on the dollar, he WILL BE THE UNRest!   OF COURSE, 90% is high.   keep in mind that as it is- one looses money with bonds 2008.

so yeah.   a massive redistribution of wealth race starts now.   its like the olypics... grab the gold and win!!   or the silver.

See?

(in reply to celticlord2112)

Post #: 5

RE: a new currency? - 12/21/2008 10:47:59 AM

Raechard

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Well all I can say is "How the fuck did the IMF get my credit card details goddamnit!"

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Nobody wants to listen to the same song over and over again!

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Post #: 6

RE: a new currency? - 12/21/2008 11:15:14 AM

awmslave

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Countries come out with new money usually when one has to carry bags of money to buy a loaf of bread. If US government decides to proceed this way, it would be too obvious robbery by deeply cutting into peoples saving accounts. I would predict rather that after markets stabilize a little they will make strong push towards North American Union idea and "Amero". The last would path would hide the real intentions from ignorant part of the population.

(in reply to Raechard)

Post #: 7

RE: a new currency? - 12/21/2008 11:17:25 AM

samboct

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Just out of curiousity, I decided to find out how much US currency is in circulation. I found this reference-http://www.newyorkfed.org/aboutthefed/fedpoint/fed01.html

which came up with the number of $829 B globally- commenting that most of the money is offshore. You know if this currency is all of a sudden worthless- that's not such a terrible thing come to think of it. Who are these people hoarding all this cash? I suspect most of the money is being held by tin pot dictators and drug lords- the average person in another country has no need of much US currency. If these people are all of a sudden broke, I'm not sure I'm going to lose a lot of sleep over it. Yes, I know a chunk of our economy is effectively underground- which is why I think Pahunkboy's scenario of no currency won't come to pass- how will you be able to bribe a public official or a cop? Are people going to pay for their drug habit with plastic? It seems unlikely....

But the magnitude of the bank bailout number just got another reality check- basically the amount of money the taxpayer just got hit for is on par with the amount of money in US circulation. Well, if we think about what people pay cash for- things like groceries, gas, (OK, maybe not as much as a decade ago.) fast food, tolls, parking fees, booze, some shopping, etc. its pretty clear that the bailout is divorced from reality. Especially because that was a drop in the bucket. For most of us, cash still makes up a significant part of our spending- I'll bet it varies from 10% to 50% or so for people who aren't millionaires. Thus, this bailout is targeted at the super rich- who are pretty useless to an economy anyhow.

I don't think you can have a functioning economy with so much money sitting in so few hands effectively on the sidelines- and all the while demanding more. In a decade, people are going to be shaking their heads and saying- what were they thinking????

Sam

(in reply to Raechard)

Post #: 8

RE: a new currency? - 12/21/2008 11:29:44 AM

Raechard

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I'd say a great proportion of this offshore money is instead tied up in foreign bank holdings and those companies that regularly deal with the US. If devaluing your currency is a tactic you would support then don't expect any foreign investment bank to see your economy as being a good opportunity for investment in the future and don't expect any foreign company to want to deal with you if you suddenly say: "You know that paper IOU we gave you well fuck you because it's worthless."

There is no way that amount of money is only held by criminals.

< Message edited by Raechard -- 12/21/2008 11:30:51 AM >

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えへまにんへえや
Nobody wants to listen to the same song over and over again!

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Post #: 9

RE: a new currency? - 12/21/2008 6:09:39 PM

samboct

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Raechard

I don't think so. Most foreign banks would never need to keep a billion dollars in a reserve- heck that's 9 tonnes of money if it's in hundreds. And it's only accepted currency in all transactions in our country. Banks aren't going to use paper for most transactions- they'll be electronic. It's only if somebody's going abroad that you need to have some $$ on hand.

Again- how many companies have billions in cash on hand? Don't you run into trouble if you try to get on an airplane with more than $10,000 or so? Nope, I think it's tin pot dictators for a chunk of it. Look at how many shoes Imelda Marcos had or the amount of money Yasser Arafat had tucked away in Switzerland (OK, he didn't have a stash of dollars) to recognize that greed knows no satiety. The cocaine business is also a cash business- electronic transactions are too easy to trace. Clearly a lot of money has gone to South American druglords.

Let's assume that $300B is in US circulation. Well, that's about $1,000 per head. Other countries are only going to need a small fraction of that amount- so why do they need billions- like around $500B? Nope, that amount of money in foreign circulation is no goodnik money.

Sam

(in reply to Raechard)

Post #: 10

RE: a new currency? - 12/21/2008 6:17:19 PM

corysub

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Joined: 1/1/2004
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quote:

ORIGINAL: LadyEllen

Samboct brought this up and it would appear to be a realistic way out of the hole.

As I understand it, we make the current currency redundant and start with a new one which is valued at several factors different to the current, so reducing the hole from an unmanageable few quadrillions or whatever, to a more manageable few billions or whatever.

Lenders (including investors) and creditors lose out - but then as things stand they lose out anyway, and totally. This way they get something, even if its cents in the current dollar.

The problem as I see it though, is if the US did this, it would require that no other nation on the planet did it as well - if they did then the resulting revaluation as it related to their creditor amount would be affected. The money owed to them could be reduced by less (so not affecting the hole as much), cancelled out altogether (if their revaluation was similar) or even increased (if their revaluation was more drastic).

Am I thinking along the right lines here with the problem?

E

Some of those "investors" are probably retired moms and dads of people here living on interest income from their bond investments. I don't think it's a good idea to make millions of seniors homeless....Obviously, it would be a great thing for people who have a lot of debt...just wipe it away....
No question we are going through a debacle in the credit and housing markets with ripples throughout the economy, the auto industry being a prime example. However, the steps taken by Secretary Paulson and Bernake seem to be working their way into the system as evidenced by the signficant drop in LIBOR and in mortgage rates with people rushing to re-finance under 5% for 30 year mortgages. Things always look blackest at the bottom and it seems to me the stock market as a thermometer of what we might see in six months or so could be signaling that we are seeing the bottom. Don'f forget too, the unbelievable 100 plus point drop in the price of crude oil is a major help to the consumers pocket book psychology. If our politicians don't do anything stupid from this point on, we could start to see that proverbial light at the end of the tunnel.

(in reply to LadyEllen)

Post #: 11

RE: a new currency? - 12/21/2008 6:27:28 PM

rachel529

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all this was set in motion 100 years ago, when the power to print money in the US was privatized. yay fed reserve!

(in reply to samboct)

Post #: 12

RE: a new currency? - 12/22/2008 12:16:38 AM

MrRodgers

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quote:

ORIGINAL: celticlord2112

quote:

Am I thinking along the right lines here with the problem?

No. Changing currency does nothing--debts are either paid or defaulted upon. If creditors get pennies on the dollar, they get that regardless of currency.

The "problem", such as it is, is a mountain of paper debt leveraging paper assets--neither debt nor asset exists in a tangible sense. No amount of currency juggling will change that.

The paper debt and the paper assets need to be tossed on the trash heap--and until that happens, the pain will continue.

Obviously and simplistically wrong. First...how many pennies on the dollar ? Then in what currency relative to my own or other currencies say..the dollar, will I be paid back ? Why ? Because if you had noticed and cared to know the currency markets, it would tell you that despite all of our troubles...the dollar has gone up.

WHY ? Because it is perceived as the best resevoir of value vs other currencies and that value is maintained by the American labor force because inspite of everything a currency has value only in direct terms of the labor you will get in exchange and our 1.5 BILLION 'man/hours' PER DAY will make all of our debt in dollars...good.

YES, there is a new currency coming called the Amero which will be a combination of the Canadian dollar, the Mexican peso and the US dollar all of which will be no more. It will not come about until the Euro is sufficiently devalued vis-a-vis the dollar so the Amero will not suffer the de-valuation that the Mexican peso will bring upon it...vs the Euro.

< Message edited by MrRodgers -- 12/22/2008 12:19:47 AM >

(in reply to celticlord2112)

Post #: 13

RE: a new currency? - 12/22/2008 4:15:33 AM

LadyEllen

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Thanks for all the responses - the question really though was about how it could work if other nations did the same?

The aim as I see it, is to reduce the unmanageable to the manageable - but only relative to others who remain constant. If those others also do the same, then surely the unmanageable remains unmanageable, just the numbers change but the relative situation is the same?

E

_____________________________

In a test against the leading brand, 9 out of 10 participants couldnt tell the difference. Dumbasses.

(in reply to MrRodgers)

Post #: 14

RE: a new currency? - 12/22/2008 4:44:50 AM

Hippiekinkster

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From: Liechtenstein
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quote:

ORIGINAL: LadyEllen

Thanks for all the responses - the question really though was about how it could work if other nations did the same?

The aim as I see it, is to reduce the unmanageable to the manageable - but only relative to others who remain constant. If those others also do the same, then surely the unmanageable remains unmanageable, just the numbers change but the relative situation is the same?

E

Well, you are right. The problem hasn't changed. The only thing that has changed is that the problem is now defined in Millikronks rather than Megakronks.

Basically, it's a question of semantics. If a Newpeso is worth 1000 old pesos, and what once cost 1000 old Pesos now costs 1 newPeso, nothing has changed. A new scale has been substituted for an old scale, is all. I remember when Mexico did that. It was a slick fucking trick because there was a time cutoff for the exchange. After Yada 31, 199X, old pesos were worthless. After 31 Yada 199X, Old Pesos were nothing more than historical souveniers.

Nice scam.

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(in reply to LadyEllen)

Post #: 15

RE: a new currency? - 12/22/2008 6:24:54 AM

UncleNasty

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Millikronks? Megakronks?

I love it. LOLOL

Uncle Nasty

(in reply to Hippiekinkster)

Post #: 16

RE: a new currency? - 12/22/2008 6:35:21 AM

samboct

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To HippieKinkster

It's not a scam- it's a way of wiping out debt. Your debts are measured in old pesos. You've printed money to pay them off and so everybody's been paid. The money isn't worth much, but the debts are paid- at least on the books. Then you issue a new currency and to keep it manageable, you lop some zeroes off the old currency.

From my perspective- the people that get hurt the worst by this are the folks who have massive bank accounts. Yes, retirees will get hurt too, but we can resume paying out welfare with new dollars. The people who had billions in old dollars in statements won't have so much any more and we're under no obligation to make them rich again. The real trick is to not go to a fascism because that's what these folks want. Harry Truman made that observation- when the money of a country becomes accumulated in too few hands, those people pick someone as a front man for them. In Italy it was Mussolini, in Japan it was Tojo, and in Germany it was Adolf Hitler. I'm not going to argue with Harry's shade- I think he's right.

Sam

(in reply to Hippiekinkster)

Post #: 17

RE: a new currency? - 12/22/2008 6:44:10 AM

pahunkboy

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Lady E., a big factor in shaking the grip, will be the US. If done, then the others will have an easier time. tho- even in the worst case scenario, the other countries will be in better shape then the US as they can consume what they produce. (instead of ...current)

30 years ago, one could take a paper food stamp $1, buy a .17 can of soda;, then have .83 in coins. Go thru the line 3 times, and whalla, cigarette money. :-) Short rent? sell stamps, .75 on the 1.00. if one needed rent or booze, it worked for both buyer and seller.    (forget weather it is legal, or wrong)

But NOW, with the stamps on a debit card, no coins, no selling it.   BUT! One could buy 4 dozen eggs, then trade them for a pack of cigarrettes.... both go to the store in person or not.

so bribe could happen but it is harder. to anyone who says this is very immorral, one could go thru the line 2x with one family only coupons, there are many variations of the concept.   the point is that it NOW gets harder to do.

(in reply to UncleNasty)

Post #: 18

RE: a new currency? - 12/22/2008 7:00:28 AM

MrRodgers

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quote:

ORIGINAL: LadyEllen

Thanks for all the responses - the question really though was about how it could work if other nations did the same?

The aim as I see it, is to reduce the unmanageable to the manageable - but only relative to others who remain constant. If those others also do the same, then surely the unmanageable remains unmanageable, just the numbers change but the relative situation is the same?

E

Young LadyEllen...this is all quite managable and they are managing quite well in fearthering their own caps...stashing it away all the while living quite handsomely on the dole.

There is nothing wrong here kinkroids. Everything is going according to the capitalist script. You think any of the elitist aristocracy is worried ? Hardly...they are flush with our tax money.

(in reply to LadyEllen)

Post #: 19

RE: a new currency? - 12/22/2008 8:02:53 AM

pahunkboy

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Mr R., I would guess they ARE worried.

... you are correct in that this is set into motion and must run its course.   (weather by greed or design, it doesnt matter at this point)
each legislative session, 1 more exception to the rule gets the deck stacked. Lets suppose it started in 1981. picture a deck of cards. each year a card is rigged.   so now 27 of the 52 are rigged, the (as it were) house of cards comes down.

picture a bunch of people jumping on a trampoline. some are rigid some are lucid. the group gets the idea that we can jump higher, and more people can get on the trampoline.   we have a ball of fun. we jump we scream, the entire block looks onward at all the fun we are having.    we if we got this far and it is good, lets jump even higher! Lets do summer saults, and spin hoola hoops with fire. It will be awesome.   Everything is splendid, even tho a small rip is in the tarp. (hehe) so a mosquito lands on a nose and            swat.   the entire rip comes loose!!!!!

(in reply to MrRodgers)

Post #: 20

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