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Submitted via IRC for TheMightyBuzzard
A bill recently introduced in Texas seeks to obliterate the Federal Reserve's much-maligned monopoly on currency by establishing gold and silver as legal tender — but the groundbreaking legislation, if passed, would also prohibit those precious metals from being seized by State authorities.
[...] Senator Bob Hall introduced the bill last month, which, the Tenth Amendment Center explains, "declares specifically that certain gold and silver coins are legal tender, and prohibits any tax, charge, assessment, fee, or penalty on any exchange of Federal Reserve notes (dollars) for gold or silver. The bill authorizes the payment of taxes and fees in gold & silver in certain circumstances. It would also prohibit the seizure of gold or silver by state authorities."
Would this matter in a nation where money is mostly plastic nowadays anyway?
Source: http://thefreethoughtproject.com/texas-bill-gold-silver-money-federal-reserve/
(Score: 5, Informative) by The Mighty Buzzard on Sunday April 16 2017, @10:33AM (17 children)
You realize this is precisely what inflationary fiat currency does already, yes? Inflation goes up, savings become worth less. You've never really been able to sit on your laurels and keep what you have since Nixon took us off the gold standard.
My rights don't end where your fear begins.
(Score: 0) by Anonymous Coward on Sunday April 16 2017, @02:16PM (5 children)
So the great depression was....?
(Score: 2) by Nerdfest on Sunday April 16 2017, @02:31PM
Before Nixon.
(Score: 5, Informative) by Runaway1956 on Sunday April 16 2017, @02:45PM (3 children)
The great depression was the result of buying on credit which was unsecured in any manner. Doesn't matter what the standard is, gold, silver, plutonium, sticks with notches cut in them, unsecured credit is risky. Unlimited unsecured credit is a recipe for disaster. THAT was the great depression - which differed little from the more recent depression of 2008.
(Score: 0) by Anonymous Coward on Sunday April 16 2017, @06:11PM (1 child)
There's even a name for that kind of stock market activity: Buying on margin [google.com]
the great depression - which differed little from the more recent depression of 2008
Previous bubbles which had burst were the result of "irrational exuberance", as former Fed chairman, Alan Greenspan named it.
The 21st Century version added another layer: Institutional dishonesty.
Mortgage lenders granted loans to folks they knew were unqualified.
They bundled those and sold them off as quickly as possible to greedy suckers looking for easy profits.
(Companies whose business it is to rate the quality of investments lied about those, compounding the problem.)
If there was any chance of a mortgage lender getting stuck with the crap mortgages, they would place bets against those with hedge funds.
...and none of the folks involved in this at the high levels have been sent to prison.
...or been put on trial, or been charged with crimes.
-- OriginalOwner_ [soylentnews.org]
(Score: 2) by kaszz on Sunday April 16 2017, @10:11PM
Perhaps the irrational exuberance was actually intentional exuberance to get people to loan and then bust so the assets later could be bought at a bargain for the people that really runs the show, albeit with huge discretion.
Just imagine if you had a lot of money to buy assets in 1930 when the market had just crashed. And had some insight into future earnings.
(Like in Timecop (1994) 13 minutes in)
...and none of the folks involved in this at the high levels have been sent to prison.
...or been put on trial, or been charged with crimes.
In other words the government is run by crooks. And after all if the congressmen and senators are informed of anything bad happening before the rest of the market because they get to sit on privileged meetings and get to trade without any insider charges. They have little incentive to fix the perverted incentives.
(Score: 2) by TheRaven on Monday April 17 2017, @10:01AM
The great depression was the result of buying on credit which was unsecured in any manner
The debt wasn't unsecured, it was secured by something highly volatile. You buy shares worth $X. You can now borrow $X against the value of those shares and buy shares worth $2X. Because people are buying these shares, the value of your shares goes up and is now worth $3X. Your purchasing power is now $3X, minus the $X that you've already borrowed, so you can buy another $X of shares. If you need to repay the loan, then it's fine too, because you can sell the $3X of shares, repay the $X of loan, and walk away with $X of profit plus your original $X stake. The problem wasn't that they the loans were unsecured, it was that the value of the security was intimately linked to whether people were repaying the loans. If one person's loans were called in, then they needed to sell their shares to cover the cost. This caused the share price to drop and so other people now had negative equity and had to sell their shares to make margin calls. This caused a cascading effect and at the end most people's shares were worth far less than their loans. After that, because of the rush of sales, a lot of companies' market value was below their asset value and so people who had available cash or credit were able to buy them up in large quantities, helping to concentrate wealth in the hands of a small set of people.
sudo mod me up
(Score: 4, Informative) by Thexalon on Sunday April 16 2017, @02:28PM (6 children)
Blaming Nixon and fiat currency for inflation is demonstrably wrong, for one simple reason: The worst years of inflation the US has ever had were in 1917-1920, back when it were still on the gold standard and Richard Nixon (and FDR for that matter) weren't major political players.
The only thing that stops a bad guy with a compiler is a good guy with a compiler.
(Score: 2) by Runaway1956 on Sunday April 16 2017, @02:46PM (4 children)
My response above applies here as well:
The great depression was the result of buying on credit which was unsecured in any manner. Doesn't matter what the standard is, gold, silver, plutonium, sticks with notches cut in them, unsecured credit is risky. Unlimited unsecured credit is a recipe for disaster. THAT was the great depression - which differed little from the more recent depression of 2008.
(Score: 4, Informative) by Thexalon on Sunday April 16 2017, @03:50PM (2 children)
Except that neither the Great Depression nor the Great Recession of 2008 were caused by unsecured loans. In the case of the Depression, what was going on was that people were taking on credit secured by the stocks they were buying with that credit. In the case of the Recession, everything was ultimately secured by the homes the mortgages were based on. The problem in both cases is that the financial economy was not being sufficiently propped up by the real economy (i.e. people doing work to make stuff and sell stuff).
Also, the period I mentioned, 1917-1920, was World War I, a full decade before the Great Depression.
The only thing that stops a bad guy with a compiler is a good guy with a compiler.
(Score: 1) by Scrutinizer on Sunday April 16 2017, @06:42PM
If the price of your collateral crashes (or is fraudulent), it's effectively the same as an unsecured loan. Fraud is a regular tenant throughout the US' financial history.
(Score: 2) by mcgrew on Sunday April 16 2017, @11:20PM
That's partly accurate. My college history class was about the 1920s and this [virginia.edu] was the textbook (full text at the link, and a very good read). Chapters X through XIV explain the stock market crash and its cause.
I still have the copy I had to buy in school.
mcgrewbooks.com mcgrew.info nooze.org
(Score: 0) by Anonymous Coward on Sunday April 16 2017, @03:50PM
plutonium, sticks with notches cut in them
This must be the financial equivalent of inventing people with green skin and purple spots.
Though I admit, there have been a variety of currencies before, such as sea shells.
(Score: 2) by The Mighty Buzzard on Monday April 17 2017, @01:00AM
You misunderstand. I've no objection to devaluing stationary money. It's all but vital for a healthy economy. I was just stating facts.
My rights don't end where your fear begins.
(Score: 2) by Nobuddy on Tuesday April 18 2017, @01:46AM (1 child)
Ive noticed ancaps harp on the gold standadd, while being painfully ignorant of it.
Helpful hint: the gold standard ended long before Nixon. He just took the last unused remnant of the law off the books. That would be like officially declaring the horse and buggy dead as a primary mode of transport today.
(Score: 2) by The Mighty Buzzard on Tuesday April 18 2017, @01:59AM
You should read further down. I'm not a deflationary currency fan. I was just stating facts.
My rights don't end where your fear begins.
(Score: 0) by Anonymous Coward on Tuesday April 18 2017, @12:56PM (1 child)
Sure you can! Just buy TIPS. Moving away from the gold standard was a trade-off of some of the dollar's utility as a store of value for additional utility as a medium of exchange. That makes sense, given that most people don't require that the asset they use as a primary store of value be completely liquid.
Besides, the core value-add of a government-backed currency like the dollar is that it is legal tender. A government can legislate a currency into being a better medium of exchange; they can't magically make it a better store of value. So it makes sense from that perspective that you'd play to your strengths.
(Score: 2) by The Mighty Buzzard on Tuesday April 18 2017, @01:29PM
Removing the utility of its storable value was, or at least should have been, by design. Circulating, or at least invested, money makes for a healthier economy than money stuffed in a mattress and inflation forces anyone with the sense god gave a jackass to keep their money moving.
A lot of people don't get this when they talk about how rich people just sit on their money. Rich people never sit on money if they can help it; they know their cash loses $inflation_rate of its value every year.
They also don't seem to get that money in the bank is not "sat on". It becomes part of the fractional reserve banking system and gets loaned to them to buy their house/car/whatever. Only money in a mattress or other non-interest-bearing storage facility can be called "sat on".
My rights don't end where your fear begins.