We are going to keep using a fiat currency system for the rest of our lives. No one is going to trust a government or central bank to again fix their currency to something like gold. In the great depression they suddenly changed the supposedly fixed ratio after buying gold from the public. In the 1960's again the fixed ratio of currency was secretly separated from gold by the London Gold Pool, being a collusion between central banks. Then in 1971, America completely broke all trust by going outlaw on the international stage by hiding all it's gold from their currency. Trust, but verify. We all trust fiat currency every day, when we get paid, when we buy food. The best way to verify our currency has value is to see how much gold it will buy. Countries are now having trust issues with each others debts, which in a sovereign sense comes down to the value of the currency. Soon countries will begin moving gold around to settle the debts and this gold will actually be the yardstick to which we value our fiat currencies. As this happens gold will rocket up in 'price', just as in August 2011 when Venezuela began the process to move their gold and the gold 'price' began to rocket up. The moral of this story is that credit cards are here to stay but their credits will not be fixed to gold, they will be valued by how much gold they can buy, because we can't trust the government or central banks to fix the fiat to gold. Instead we need to verify the currency by using gold as the measure of wealth. Gold is the best way of holding true wealth.
I remain hopeful that the American people will wake up and push Congress to enact HR 1098. With fiat currencies competing against gold and silver, central banks would finally have a real constraint on malfeasance.
I might be misreading here, and whilst I don't disagree with your comments on the ratio changes, surely you can see that a pure fiat currency, as we have had since 1971, is the root cause of the problem? Herein is the root of the problem (and by the way, I disagree with your statement that "we all trust fiat currency" - I don't. I think it's going to hell in a handbasket, and it will need replacing sooner rather than later (whether with another paper currency backed or partially backed by gold, I don't know). One should not value one's fiat by determining how much gold it will buy, one should value gold by seeing how much fiat currency is required to purchase it. There is a subtle, but quite substantial difference between the two, what I'm effectively trying to say here is that in reality, fiat is not money, only gold is, and as such, it must be the yardstick by which all others are measured. This measurement, over time, will give one a clear indication of the effect of inflation - something that only a fiat currency is subject to by and large (yes, annual mining production would cause around 2% increase in the gold supply every year - I guess this could be viewed as a form of inflation, were it not controlled). I'd have to express my thoughts here - it doesn't come down to the value of the currency at all - fiat currency only holds value based on a governmental decree. If we had remained on a gold standard, or gold backed currency, the outrageous and unsustainable debts (and in some cases, debts that are beyond the means of the country holding them to ever pay back) would not have occurred in the first place. I personally don't believe the current debts held by countries will be "paid off", be that in gold or anything else. The collective impact of the printing presses world wide over the past 40 years have left mankind in a mountain of paper, and this mountain of paper has (what little value it has left) only by government decree. Yes, most surely, gold could be "redenominated", or "revalued" as you put it - though please bear in mind, the true base value of gold has never changed one bit in around 5000 years - it still holds the same true value today, it's just that our very manipulated markets have managed to place on it a fiat value that is nowhere near its true worth. I do expect that "revaluation" to happen, as various countries and fiat currencies around the world collapse, and get replaced with "New <insert country here> dollars". Then yes, when compared to fiat, the "price" of gold will change. One can only hope that these new currencies being introduced will be fully or (as is more likely the case) partly backed by gold. Back to your original comment on sovereign debt, as I mentioned, I don't expect it to be paid back, I expect it will mostly end up being forgiven and eradicated - this, together with a reintroduction of a new currency, is really the quickest and simplest way out of the current mess that I can see. I would fully expect, in today's day and age, that electronic banking methods and automatic payment systems are here to stay - it would be hard to conceive of commerce without them. I would, however, expect most average citizens will not have, nor want a "credit" card (as opposed to a debit card for electronic transactions). I would expect, going forward - and assuming that we eradicate all the failed fiat currencies of today, replacing them with new or renamed, and redenominated versions, that most folks won't have any form of "ready" credit, a loan may be taken for a large purchase (e.g. a home), but all other - or most other purchases, including cars and other consumer goods, will be purchased AFTER the money is saved with which to afford that item. I know this flies in the face of the current trend of "I want it now and I deserve it" - but the reality is, we all have been living (as a generalisation) beyond our means for far too long, and the day is quickly approaching when the buck will have to stop somewhere. I expect some very upset members of the community when that day comes.
the financially illiterate may trust fiat currencies but those who know better would 100% prefer something tangible and real like gold. Its only so long that governments can play the paper game until it inevitably returns to its intrinsic value, zero. In the dying stages of fiat currency, violence, social chaos and uprising/harsh dictatorship are the norm as history repeatedly shows
But it doesn't take long for the 95% to change their mind when fiat is on the skids! Regards Errol 43
Not just financially illiterate - but outright fucking stupid. You cannot go outside anymore without bumping into a dozen complete dumb arses before you reach the first set of lights.
I agree that a fiat currency is here to stay for the majority. Even when there was an official gold standard people were still using fiat and i can't ever see this changing for the majority. In reality the gold standard never really ended. If i can trade my fiat for Gold then it still stands. Only now the price is being constantly revalued to match its true** value. So like you i also see gold just being used as a measurement tool to determine what each currency is worth and I'm guessing its going to be doing some major revaluing soon! At the end of the day average Jo is always going to get screwed, be an official gold standard or not. The only true Gold/silver standard means people are physically using it to transact and this also means there will be bartering to accompany it. But i can never see this happening again.
I just hope they don't ban physical cash. If it's all electronic like credit cards and microchips, they would have the power to effectively oust people from society by cutting them off from buying anything.
yeh but that's simply because house prices are falling... Once gold starts rising again - then you'll see the real meaning of "fast tracked"
That's a natural result of the socialists' agenda which enables stupid lazy people to outbreed intelligent hardworking people...
yea i know, i was just saying that no matter what we will always be using fiat to transact. Even on a gold standard people will still be cooking the books so there will never be enough gold backing the fiat. Therefore an official Gold standard backing fiat is pointless and will only last a short amount of time before people smell somethings off and demand all the gold again. In which they then close down the gold window and start again.
Did anyone else see this news article yesterday: http://au.news.yahoo.com/thewest/a/...rd-and-wallets-this-watch-will-pay-your-bill/ Seems Mastercard is hard at work to move us further into a cashless society.
The key to it being gold back, is not backing. But redeemable. If it is not redeemable in gold, it is not worth having. REDEEMABLE.
I prefer the microwave :lol: Visa Paywave meet my lovely Microwave yeeeeeeaaaaaaahhhhh bam RFID dead.
