Re: Do the Bankers Want to Secretly Return to a Gold Standard?
Interesting post on ZH.
Guest Post: In A Gold Standard, How Are Interest Rates Set?
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Submitted by Tyler Durden on 06/06/2012 16:48 -0400
Quote:
Submitted by Keith Weiner, President of the Gold Standard Institute, USA
In A Gold Standard, How Are Interest Rates Set?
Today, short-term interest rates are set by the diktats of the central bank. And long-term interest rates are set in a “market” in which the central bank is obliged to keep coming back to buy ever more bonds, and speculators front-run the central banks to buy ahead of them. The result has been that, for 30 years and counting, the bond price has been rising, which is the same as to say that the rate of interest has been spiraling into the black hole of zero. When it gets there (and probably sooner) the entire monetary system will collapse.
This is the terminal stage of the disease of irredeemable paper currency. They have banished money (gold) from the monetary system, and the result is a positive-feedback-loop that destabilizes the rate of interest. The rate of interest has a propensity to fall, just like the value of the paper currency itself.
This leads to the question of how interest rates are set by a free market under a gold standard. This is a non-trivial question, and the answer is profoundly important as we debate what sort of role gold ought to play and evaluate the various gold standards being proposed.
If people are free to own gold coins directly, then the mechanics of setting the rate of interest are simple. Let’s define a term. The marginal saver is the saver who could go either way, either holding a bond or a gold coin. If the rate of interest ticks downward, he will sell the bond (or withdraw his money from the bank, thus forcing the bank to sell the bond) and buy the gold coin. He would rather hold the gold than commit to the time and risk for such a low interest rate. If the rate of interest ticks upward, he will buy the bond (or deposit his coin in the bank).
The marginal saver sets the floor under the rate of interest. It cannot fall below his preference or else he will vote with his gold. His preference has real teeth (unlike today).
Now let’s define one more term. The marginal entrepreneur is the entrepreneur whose rate of profit is the lowest possible, while still being viable. If his profit falls for any reason, such as due to a rise in costs, he will shut down his enterprise. One cost is the cost of capital, i.e. the rate of interest. No entrepreneur can borrow at a rate higher than his rate of profit, and the marginal entrepreneur is the first to buy the bond and sell his capital stock at an uptick in the rate of interest. He is the first to sell a bond and buy capital stock at a downtick in the rate.
The marginal entrepreneur sets the ceiling over the rate of interest. It cannot rise above his ability to pay, or else he will vote with his capital stock. He also has teeth.
Under a proper gold standard, the rate of interest is kept in a band that is not only narrow, but which is also stable over long periods of time. This is the principle virtue of the gold standard. It does not fix the level of prices, which would be neither possible nor desirable. It keeps the rate of interest consistent, which serves the interests of wage earners, pensioners, and other savers, and of entrepreneurs whose work provides the goods, services, jobs, and interest payments that on which everyone else depends (and which they take for granted).
When evaluating any proposed gold standard, one should ask the question: how will it determine the rate of interest?
Re: Do the Bankers Want to Secretly Return to a Gold Standard?
Quote:
Originally Posted by
Carl
A gold standard limits bankster activities, and I don't think they're out to place limits upon themselves.
No they don't. But we are entering the Age of Aquarius and a new paradigm is upon us. Honest money will prevail in spite of the bankers. Gold will prevail in a new honest system not dominated by the Luciferian sodomites.
Re: Do the Bankers Want to Secretly Return to a Gold Standard?
The top invented the gold standard or fixed exchnage rate system...but once the maximum potential inflation is reached...they then get rid of it...until the maximum potential of the floating exchange rate system is reached...then it's back to the fixed system again.
The top has ruled you all for all of recorded history...The top owns everything...
The top invest gold into the system...for every gold coin they invest they expect 5% or more out...and when the bottom can no longer supply the top with the yield of gold they demand.
Then the economy implodes...or the top can issue IOU's since the top owns the entire money supply...eventually the bottom reaches the point where they can no longer service any more debt and it becomes impossible for the bottom to supply the demand for yield by the top...and the economy implodes.
How a gold standard works...
The top employs the bottom to supply the top with all the gold wholesale...the top then marks it up and sells it to the bottom retail.
the difference between the whoelsale cost and the retail price is the yield the top lives off of...
over time the yield the top demands the bottom to supply causes the demand for Gold to constantly increase until the demand for yield becomes greater than the supply/production...and the system caves in.
Once the net producers reach their maximum potential to support the net consumers...the economy collapses...reguardless of what "standard" is being utilized.
Re: Do the Bankers Want to Secretly Return to a Gold Standard?
Quote:
Originally Posted by
Hypertiger
The top invented the gold standard or fixed exchnage rate system...but once the maximum potential inflation is reached...they then get rid of it...until the maximum potential of the floating exchange rate system is reached...then it's back to the fixed system again.
The top has ruled you all for all of recorded history...The top owns everything...
The top invest gold into the system...for every gold coin they invest they expect 5% or more out...and when the bottom can no longer supply the top with the yield of gold they demand.
Then the economy implodes...or the top can issue IOU's since the top owns the entire money supply...eventually the bottom reaches the point where they can no longer service any more debt and it becomes impossible for the bottom to supply the demand for yield by the top...and the economy implodes.
How a gold standard works...
The top employs the bottom to supply the top with all the gold wholesale...the top then marks it up and sells it to the bottom retail.
the difference between the whoelsale cost and the retail price is the yield the top lives off of...
over time the yield the top demands the bottom to supply causes the demand for Gold to constantly increase until the demand for yield becomes greater than the supply/production...and the system caves in.
Once the net producers reach their maximum potential to support the net consumers...the economy collapses...reguardless of what "standard" is being utilized.
Which is why gold is not the answer. The entire paradigm needs to shift away from currently understood concepts of money with the first being competition.
The top is at war with competition, otherwise, they can no longer be the top.
Re: Do the Bankers Want to Secretly Return to a Gold Standard?
It's not really about the money, only as far as it establishes control. While I do believe in monetary reform, until we rid ourselves of the elite banking scum etc we are all still F'd no matter what we do.
Re: Do the Bankers Want to Secretly Return to a Gold Standard?
Quote:
Originally Posted by
Hypertiger
...for every gold coin they invest they expect 5% or more out...
So is it really all about gold for the top?
Is gold the top priority and control the second, or is control top priority and gold second?
Re: Do the Bankers Want to Secretly Return to a Gold Standard?
Quote:
Originally Posted by
Hypertiger
The top invented the gold standard or fixed exchnage rate system...but once the maximum potential inflation is reached...they then get rid of it...until the maximum potential of the floating exchange rate system is reached...then it's back to the fixed system again.
The top has ruled you all for all of recorded history...The top owns everything...
The top invest gold into the system...for every gold coin they invest they expect 5% or more out...and when the bottom can no longer supply the top with the yield of gold they demand.
Then the economy implodes...or the top can issue IOU's since the top owns the entire money supply...eventually the bottom reaches the point where they can no longer service any more debt and it becomes impossible for the bottom to supply the demand for yield by the top...and the economy implodes.
How a gold standard works...
The top employs the bottom to supply the top with all the gold wholesale...the top then marks it up and sells it to the bottom retail.
the difference between the whoelsale cost and the retail price is the yield the top lives off of...
over time the yield the top demands the bottom to supply causes the demand for Gold to constantly increase until the demand for yield becomes greater than the supply/production...and the system caves in.
Once the net producers reach their maximum potential to support the net consumers...the economy collapses...reguardless of what "standard" is being utilized.
That shit flew during the Age of Pisces, but times they are a changin. The top is going to get dick stabbed when we go to a calorie based monetary system.
Re: Do the Bankers Want to Secretly Return to a Gold Standard?
Gold is money, a store of tangible wealth. The gold basis is the most stable and documented of them all.
Banks do not profit by transacting in gold, if they are honorable. Banks profit by transacting in credit. Credit is unbacked and physically represented by notes. Banks can control the supply of credit and thus interest rates. Gold prevents banks from having this control, in the absolute.
Only governments committed to permament peace and stability can maintain a gold-backed coin of the realm. The act of war casts the gold standard asunder. Only a credit-based system gives government to ability to prosecute wars and engage in social engineering.
Gold will always be money and a tangible store of wealth. Honorable governments will embrace gold to back their currencies. Honorable governments do not exist.
Re: Do the Bankers Want to Secretly Return to a Gold Standard?
Forget gold standard imo...(I guess it's better than nothing though)
We need a land standard. There are 2,379,964,800 acres in the U.S. according my brief google-ing session. There are about 312 million people in the U.S. If we divided this up, it's about 7.6 acres for every man, woman, and child.
But, if we decided to divide the land up according to Numbers 33:54-
'You shall inherit the land by lot according to your families; to the larger you shall give more inheritance, and to the smaller you shall give less inheritance. Wherever the lot falls to anyone, that shall be his. You shall inherit according to the tribes of your fathers.
- Everyone isn't going to be living by themselves, on their own 7.6 acres. Another issue is that some of the land isn't farmable. (which is my basic idea, people growing their own food, no money really needed) But some land will have other value I suppose, like mineral deposits? Also a ton of people won't go along with it...so ....they gotta die (?).
Then there is the matter of the Canaanites, "when you go into the land I'm preparing, take them out (paraphrased)."
Homos, adulterers, atheists (just keep quiet and you'll be alright (?)) - all dead men walking. Now you can see that even more space is becoming available.
Divide the land + farming + executing = problems solved
Re: Do the Bankers Want to Secretly Return to a Gold Standard?
Quote:
Originally Posted by
D sciple
Divide the land + farming + executing = problems solved
I agree with this here, but the way you talk about doing it I don't necessarily agree with. I think perhaps something like Henry George advocated might be better.