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overtheedge
Membre depuis mai 2012
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"Reinstatement of the Dollar: a Blueprint" (Arthur Laffer, 1980)

- Nathan Lewis - New World Economics

"It seems to me that history is actually pretty clear regarding cases where precious metals have lost their value. "

No vox, it is NOT.

"Lastly, commerce was mostly local. No large scale shipping or just in time deliveries. Advertising was virtually non-existent. If you needed large amounts or specialized commodities, you sent purchasing agents scouring the various fiefdoms, kingdoms and major marketing centers such as Venice. "

Any inflation was dissipated into a slow distributive, but functioning world economy.
What we think of as supply/demand curves were meaningless in an economy where everything was hand-crafted and production methods were strictly controlled by crafts guilds.

"We could look at how America was forced to demonetize silver in 1873 after large new discoveries in the west drove the price so far down that people actually preferred to hold paper dollars. "

1. The so-called paper dollar of 1873 has absolutely nothing in common with today's dollar.
2. The valuation of silver (and gold) was assigned by government, not the market.

"Trouble arises when those entrusted with how our tax dollars get spent become reckless. They print more paper, or decree that it will henceforward take 35 paper dollars to purchase an ounce of gold, or they put less metal in the coin, but do not change the denomination stamped onto its face; all because they consistently spent more than was coming in. That never changes."

Therein is part of the problem. Add fractional reserve banking and distributed risk into the mix. Top it off with each individual's refusal to accept personal responsibility and a full-blown belief that their labors are very valuable when they produce nothing. The average farm-worker laying on a harvester cutting cabbages is far more productive than most Americans. Their labor produces a product. Service industries merely transfer wealth with a hefty surcharge.

Government and its subsidiary Treasury Dept is just a service industry. It produces nothing and takes a hefty bite. It is an insurance scam.
Modern banking supports this system. They are the modern day money-changers, the goldsmiths and John Laws.

Economics is simple to understand once you strip all the mumbo-jumbo out. It is income versus out-go. If you carry any debt for non-productive endeavors, you have failed to grasp economics. Carried debt either enables income productivity in excess of debt service costs or you and your belief system are in error. But I admit that luxuries are addictive.

If you lack the means of production, you are just an over-paid servant. Most Americans are physically, mentally and intellectually incapable of growing a cabbage. Perhaps the term "servant" was erroneous. The zoo occupants are complaining about the feed rations and feeding time.

Folks, you really need to learn the fundamentals of economics. Production increases wealth. Service redistributes wealth. Income MUST surpass out-go. No matter how much lipstick you put on a pig, it is still a pig. Or in Dr. Phil's lingo, if you always do what you always did, you'll always get what you always got. I can already see how that is working out for you. So you might wanna think economics using the acronym KISS.

Oh, you might wanna really study history and quit relying on a cheat sheet produced by someone no more knowledgeable than you. Snap-shot history is crap. No, I'm grossly in error. Crap has value as fertilizer.

Everything is connected to everything.
Everything has to go somewhere.
There ain't no such thing as a free lunch. TANSTAAFL

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Gold as currency or not? I don't know. I do know that when disaster overwhelms a region, the insurance policies take quite some time to collect on. Now what if that disaster were a global event.
I would argue the term, "Good as gold" is utterly ridiculous. Why not just stick to gold? Or silver or growing cabbages? Oo, why not a melange?

Commenté il y a 4172 jours

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Début de l'article :Here's something that Arthur Laffer (who was also working closely with Chuck Kadlec at the time) put out in February 1980. Of course, in 1980 the dollar had been declining in value for a decade, and, at the time of this paper, had just had a real crash which brought its value momentarily to $850/oz. Mercantilist "easy money" was a disaster. There was a lot of talk at the time of reinstating a gold standard system, which at the time had been gone only nine years, sinc... Lire la suite

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