The Federal Reserve

http://www.lewrockwell.com/paul/paul53.html

Note for the confused:  the 'Federal' Reserve is private, not public. 

For clarity:  the Federal Reserve is a privately owned company. 

This organization is clearly unconstitutional, and no true supporter of Free Enterprise or the American Constitution should support it.

Not to mention it's effects on lower-middle class people on fixed incomes...

The Federal Reserve is a private company, however, the government supports it because it helps prevent runaway inflation/deflation.  Governments that adopt similar organizations have a currency that doesn't suddenly become worthless, like most of Africa.  The African Union is starting a continent-wide bank system similar to the Fed in order to balance its currency and prevent future instability.

>>2
A reinstitution of the gold standard would prevent both of those problems with ease. 

What's the point of inflation?

>>4
Inflation is caused when the Federal Reserve dumps more money into the money supply.  This, of course, makes everyone else's money worth less.  Devaluation of the dollar occurs. 

The simple solution to this, is a return to commodity-backed money.

>>5
privatise currency?

>>6
I'm saying we should back up the money that there is.  There was a time, for example, that you could take your dollar bill to the feds and exchange it for a set sum of gold.  The dollar would hold it's value... it was tied to the gold, in terms of value. 

>>7
What if somone discovers 10000 kilos of gold or something? Surely at heart currencies are based on trust and the only way to ensure trust is to privatise currencies so they compete for the public's trust?

>>8, that idea is stupid (and expensive) when all we have to do is return to the gold standard. THAT'S ALL.

>>8 & >>9
Let's not fight.  We all like the gold standard, yes? :D

Countries would use loot from war or import/export goods to other countries in order to acquire more precious metals, increasing the country's wealth through trade.  This was called Mercantilism.

During the colonial period, currency consisted of receipts for various goods such as gold, silver, or tobacco.  A receipt could be traded for an equal amount of goods from a store or warehouse.

State currency was used, but counterfeiting was rampant, and the changing values of different currencies meant people could load up on one currency and go to another state bank to exchange it for profit.

A national banking system was proposed in 1912, but Jackson felt it was unconstitutional and it was disbanded shortly after.  A second national bank was created under Hamiltonians.  This would be the precursor to the Fed.

Bimetallic coins were tried with a combination of gold and silver, but the fluctuating price of both meant the value always didn't match the face value.

There were some pure gold dollars issued that were later recalled, but a few coins remained in private hands and are worth millions now. 

Nixon removed the gold exchange for dollars to foreign countries, so that other countries couldn't buy out all our gold reserves.

Eventually the government realised it should just keep all its gold in one safe place in case the dollar does collapse, without having to fork any of it over to the people.    

The war in the Middle East secures oil trading for various oil companies, as well as in Africa where US companies operate while supporting various dictators.  Thus precious commodities can still be exchanged for goods and services, giving the kings and queens of our nation more wealth. 

>>10
I don't. I think in the future someone will start mining tons of gold and be like omg lol according to the gold law I rule the planet now.

Better to use energy as a currency and privatise currency to simplify transactions, that way if someone produces tons of energy the money they get reflects the worth they put into the economy.

Let's start a mining company!  All we need is a really big metal detector.

>>12
I think you have no (or very little) understanding of the Gold Standard or of the idea of having commodity-backed money in the first place.

>>14
Commodity-backed money = lesser version of privatised currency

Why not simply have companies that produce receipts and people trade these receipts depending on how trustworthy they believe ethey are. Just like investment banks make a living through trusts, privatised currencies would do the same and frankly I trust private companies that make wealth directly from trust rathr than some government monopoly which uses incredibly stupid ideas like printing money and inflation to screw over the average hard working man.

>>15
Well, right now, the "Federal Reserve", a private corporation, has a monopoly on money printing, evidently.  What would you call this?

So let the regulation and printing of money run rampant, got it.

>>17 Black-and-white seems to be the optical setting here. You should get some CMYK analytic capabilities bashed into you.

>>16
A monopoly.

>>17
Consumers are not stupid, in a competitive market there may well be privaticsed currencies that try to gain some trust then start printing their receipts like crazy causing mass inflation. However consumers will prefer to take receipts from prestigious banks and from companies that they are employed in. Apparently the federal reserve is completely private even though it is heavily influenced and regulated by the government, but to a certain extent already all our trust is put into 1 privatised currency!

I think the running of money and it's true worth is best left in the hands of millions of people who depend strongly on it and 10s of different companies which have to prove to each and every one of them that their currency will not inflate rapidly due to money "production", cannot be forged, can be measured as something of substance instead of information and will have a stable foreign value irrespective of it's use by the government.

Good luck with that.

>>20
Since you agree that it would increase the wealth of the nation, would you support such a policy?

This would help lower-middle income class people who are on fixed incomes, yet you don't see the dems supporting it. 

>>22 I don't think any established politician wants that. Unintended Results and all that.

I don't see it working.  Elaborate.

>>23
What are you saying?

>>24
You don't see what working, commodity backed money? It's real simple.  Fuck the federal reserve, and have the feds keep a big vault full of gold that corresponds to each dollar in circulation.  There should be oversight of this.  That's all.  Since each dollar is backed by it's set value in a certain commodity, it will hold it's value perfectly.  A dollar earned today would hold the same purchasing power as that dollar have if spent in ten years.  (unlike now)

We went off the gold standard for a reason.  A very specific reason.  Not sure what though.

>>26
Because it fucked the farmers, as more goods got pumped into the economy, the price went down, so farmers couldn't make themselves richer by producing more, and they had loans to pay...but with worthless crop prices, only way to pay off their debts would be to lower the value of the dollar.

I don't see why everyone is so excited about privatizing currency, it pretty much lead to horrible speculation crashes every 3 years or so.
It's not as if you're going to be able to buy a really great house for $20,000, I can guarantee you your pay will decrease to match the value of the currency. 
But then again that would be really good for the people with 7438256728465 dollars lying around right?

>>14
He's actually sort of right, the whole Mercantilist theory was based on a finite amount of wealth, increasing the avaliable amount of wealth (I.E. Zomg I found gold) still creates inflation.
Is the issue here that we don't trust the Fed with our G, or that we want to curb inflation?

>>19
Consumers are fucking stupid! How many people smoke cigs when they hear it'll kill them? How many people eat at McDonalds when the food is unhealthy? How many people drive SUVs? How many people wear Che Guevara, Abercrombie, and Aeropostale T-Shirts?

Good God! Consumers are sheep that can't be trusted to wipe their asses with TP instead of Sandpaper.

>>28
What the hell? What I'm saying is if we don't have commodity backed money, the feds can print off more money willy nilly with no real consequences whatsoever.  This is economic destruction for any lower-middle class person on a fixed income. 

Commodity backed money doesn't mean privatization of currency.  It means commodity-backed currency. 

Moreover, the "Federal" Reserve is a PRIVATE COMPANY, it is not a government run agency. 

>>28
"But then again that would be really good for the people with 7438256728465 dollars lying around right?"

Not often do rich people do that.  Not intelligent ones anyways.  I guess you didn't read the article in counterpunch about Cheney betting on economic collapse. 

All the rich folks gotta do is convert their money into a stable currency, put it in the stock market, buy gold, etc, and they are just fine.  (Sucks to be an average person I guess, eh?)

(>>31) continuing,

The people who lose out aren't the rich - the rich are intelligent and pull their money out of US Dollars, unlike your average middle-lower class guy.  Don't believe it?

http://www.counterpunch.org/whitney07052006.html

The rich withdraw their savings from our currency, the currency plummets, killing the savings of average and lower class folks across the nation, and they emerge and can pour their money back in once things have stabilized, or convert some money a little at a time when they want to spend american cash...

It doesn't affect them hardly at all.  Not next to the massive amounts of lost savings, standard of living, and purchasing power of the middle class and poor. 

>>29
We want to curb inflation.  But heck, if someone else wants to ascribe some other reason to it, they can go right ahead far as I'm concerned.

>>32
Ok, you win that argument, but bring up a new one.

Fuck rich people, crashing our economy with their shorting games.

http://en.wikipedia.org/wiki/Silver_as_an_investment

So if you had your money in gold in 1980...

Wow, so we all agree now that a return to commodity backed money would be a good thing?

Hehehe.  Support the libertarian party then. 

http://www.lp.org/

in 1980

http://en.wikipedia.org/wiki/Silver_as_an_investment#Silver price