patrick.net

ad says

How much self sufficient was Peru ? Did it have to import energy (gas and oil) ? How much food did it have to import ? How much building supplies did it have to import ?

Peru allows cars imported into their country be converted by mom and pop shops, another start up industry. And the cars run on Natural Gas. Gasoline and Deiseal is expensive there. But NG is dirt cheap. A taxi driver told me he get's about 300 miles out of his $7 tank in his trunk.

Zak says

It's beyond ridiculous. If workers don't produce anything, then why do employers employ them!?!?

Have you ever seen anyone's name on a pair of Nike's?

The total worldwide supply of gold increases at a rate of about .9% per year. The supply of silver increases at a rate of about 1.2% per year.

Without social security, let's say the savings rate would be 20% (and I'd say that is waaaaaay too low).

With people needing to save 20% minimum of what they make and the supply increasing about 1%, how long could the system survive?

Tenpoundbass says

Have you ever seen anyone's name on a pair of Nike's?

This is the answer I would expect. You don't know, but you have a question that is confusing to you. Fair enough. But that should really inform you as to whether the opinion you are putting forth holds, and you should spend time arguing for it, or if you should be trying to listen to the other people explaining the economic foundations and asking questions.

Zak says

This is the answer I would expect. You don't know, but you have a question that is confusing to you. Fair enough. But that should really inform you as to whether the opinion you are putting forth holds, and you should spend time arguing for it, or if you should be trying to listen to the other people explaining the economic foundations and asking questions.

You sound like a whole slew of Libs that knew it all in 2007 that argued with me about Liberal truisms, that all turned out I was on the right side of.

Are you really having a hard time grasping that as someone on my payroll, you are NOT a Producer that I AM?
I pay you for your employment, you're not even providing me with a service. Business associates and partners provide my business with "Services".
I pay them for cleaning services, in which they send over cleaning employees, I pay them for Mailing services, which they send employees to come collect my mail, sort it, weigh it, stamp it and mail it.

Perhaps one of those employees is keeping money in a shoebox with the hopes of one day buying a hotdog cart to push down by the fishing pier on sunny Saturdays. He will then get to be a producer for one day a week. But that can only happen in a fiat currency society. In a Gold society his would be customers would only have Microsoft and Ford script to pay for the Hotdog. Unless the Hotdog vender lived and shopped at the Microsoft and Ford company stores, and housing, he would have no use for it. Because his Reehm accommodations don't accept those scripts.

Lol. So strawmans? That's your best shot?

>Are you really having a hard time grasping that as someone on my payroll, you are NOT a Producer that I AM?

I think this word for high opinion of yourself is called narcissism . You're really laying out your insecurities, and bad management policies, but not really telling me about how your workers don't produce things for you.

Btw, I'm not saying your workers have to make the same decisions as you, but it sounds like a nightmare to work for you. No autonomy, no reward for performance? I can see why you would fear your employees having a stable means to save. They would leave your crap employment as soon as possible.

While I'm enjoying that you think I'm a Producer, I'm a realist employee.
I'm thankful to be an employee in a Fiat currency economy. Or going on my third year in my wait and see hiatus, on which way the Commies in HR are going to take this thing. I would have been out on my ass, as I wouldn't own my house, the company store would.

Let me ask you, how old are you, and how much did you pay attention in History class. Especially on the period from about 1849 though 1945?

AmericanKulak says

This ignores the printing of banknotes by banks.

That is a separate issue though. Bank deposits should be made at the depositors own risk.

But we should not have a quasi government agency that funds a bankrupt government by printing Trillions of dollars of money for a fake Covid panic and drive up the cost of most necessities. That is what sound money prevents,

Tenpoundbass says

Peru is very rich in precious metals, but the Presidents in the 90's through the early 2000's squandered all of it to China. They were building a railway system, but one of the President's absconded with the funds, it sat unfinished for over 20 years.

Alberto Fujimori was the only President of Peru between 1990 and 2000. He was not a friend of China at all, unless you consider Taiwan as China. The Maoist Shining Path communist guerillas that plagued Peru before 1990 may have had ties to Communist Chinese military intelligence, although Maoism was waning even in China itself. Communist China was a very poor place in the 1960's through 1990's, before joining the WTO at the end of 2001, so whatever their military intelligence could do back then was more along the lines of exporting ideology (and exporting chaos-making guerilla warfare through robbing the rich and upper-middle class then middle class) than throwing bribe money around like they have been doing in recent years. I find it hard to believe Communist China would be building a railroad for Peru in 1982 (20 years before 2002), when China was much poorer than Peru. Fujimori may have been a CIA asset/agent put forth to be the figurehead for Peruvian military to carry out Operation Verde (which had been planned before Fujimori came to office). He (and his military handlers) did a lot for Peruvian people, stamping out the Maoist Shining Path guerillas by 1995, so that subsequent economic development and foreign direct investment became possible. He was initially facing a worse reality in Peru in 1990 than his personal hero Pinochet faced in Chile nearly two decades earlier. While some of military handlers did use draconian methods, unlike Pinochet facing potential armed communist rebellion (and shot them in a soccer stadium to prevent armed communist rebellion from ever taking place), Fujimori was facing a deadly armed communist rebellion already in progress and had been in progress having killed tens of thousands of innocent people (victims of communist rebels) for many years; so draconian methods against the armed communist guerillas were hard to avoid. I'm not sure what happened between Fujimori and CIA between 1995 and 2000 . . . but the apparent abandonment of Fujimori (possibly recycling his money by the banksters??) was extremely devastating to anti-communist right-leaning political parties and advocates in Latin America and in Japan / Taiwan alike. Perhaps the banksters were too cheap to have another Pinochet; perhaps they were afraid Peruvians couldn't tell the difference between Fujimori's Japanese ancestry from Chinese (Peruvians called him "Chino" despite the guy had no Chinese ancestry whatsoever)

Tenpoundbass says

When they had minerals and wealth they were held down to dirt poor third world conditions. I saw it with my own eyes. It happens all over the world. I have also seen around the world when once third world countries have commerce open up and investors build and open business where none existed before. Those countries fast track to the 21st century over night.

Your observation about the perverse effect of mineral wealth (which can be monopolized by the government or government chosen cronies) on societal liberty is correct. That phenomenon is indeed nearly universal. Now think: does it matter whether that mineral wealth is oil or gold or diamond or colbalt? It doesn't. Whatever is there down the mine shaft could well be a pile of trillions of US$'s, or a printing machine that prints out trillions of US$'s! (like North Korea allegedly has, but prints far more and universally accepted outside the country). What enables a dictatorial regime is not the specific mineral per se, but the dollar value and its ability to buy support from cronies and buy violence to suppress the public. That is precisely what a Fiat Money Central Banking system is (until the currency it prints is universally rejected). The US is effectively having a giant mine that spits out trillions of dollars, the mine is the fiat money central banking system . . . and that is why the republic is gradually breaking down!

What is a gold mine or an oil well? It's only a device the control over which enables the owner to get money much more easily than usual. Government control over such a device is devastating to the public. What is a Fiat Money Central Bank? It's a device that can spit out money even more easily than a gold mine or an oil well.

Misc says

The total worldwide supply of gold increases at a rate of about .9% per year. The supply of silver increases at a rate of about 1.2% per year.

Where did you get these numbers? Currently with silver price below mining cost (so most silver production come from byproduct of mining other metals), world above-ground silver total is likely declining due to industrial use exceeding new production. Above-ground gold total has been increasing at close to 2% per year due to central banks' demand (and Indian buying for weddings, plus whatever the rest of world's public's fear of monetary instability)

Misc says

Without social security, let's say the savings rate would be 20% (and I'd say that is waaaaaay too low).

With people needing to save 20% minimum of what they make and the supply increasing about 1%, how long could the system survive?

You can't be serious when making those assumptions. Why would anyone keep savings entirely in cash beyond building up a 6month burn-rate cash reserve? Why would anyone keep that much cash instead of investing into enterprises that potentially yield higher returns? Silver can not be cornered like gold due to the huge above-ground storage / ready potential supply in people's dinner-wares, candlesticks, etc.. If/when silver price reaches above $100-200/oz, enormous silver mines can be re-opened in the US.

A fundamental problem with the current fiat money system is that, because the economically lower 80-90% population have much higher percentage of their income spent on consumption, a 6-mo ready cash pile (or even whatever cash they have in their mattress or savings account) represent a much higher percentage of their total net-worth than that is for the top 1-20%. Constantly devaluing currency disproportionately regressively taxes them. In addition, Central Bank stretching bubbles to bail out insiders while roping in the masses (including the leading edge of a young generation reaching into upper middle class) at the market tops before dropping the hammer on the latter.

The savings rate would by necessity be much higher than the rate at which the metal is mined.

Without social security, a savings rate of 20% would be very low.

You have not addressed this fundamental flaw with the system. It leads to the system collapsing. A commodity based system is not stable.

Also, if you are promoting a commodity based system, you should have some idea of how much of the commodity is being added per year.

PeopleUnited says

That is a separate issue though. Bank deposits should be made at the depositors own risk.

Not a separate issue.

Employers will be paying employees with paper banknotes if they are allowed, and keep the gold to themselves.

Therefore, it's not the employee - or the contract providers - own risk. The employer is dumping the risk of the bank failure and the acceptance by others of it's banknote on the employee. A third party externality.

Again, we have the history of the 19th to look back on, and the "Discount" rate offered between banks for other bank's notes. You could go from Ohio to Boston and suffer a 12% charge from the note, even if your bank was in good standing.

So you get $100 in gold banknotes from Ohio First Federal but Boston banks are only giving you $88 in gold if you cash it in, maybe $95 if you took their notes. That's a 5-12% discount. Nevermind 5% inflation or a 12% tax, that sucks ass - just to get physical metal OR a local banknote in common use in the area and recognizable to stores and hotels and cab drivers. "What is this Ohio First Federahl? I ain't tahking you down Quommonwealth Avenue towards Fenway Pahk for this wicked pissah funny money! You got some Bank Boston Notes?" "

But wait! Why not have nationally recognized banks for travelling or paying cross country! We'll get to that in a second.

Newspapers published the discount rate of banknotes between banks daily as they fluctuated.

The one solution to this is to mandate by law a certain minimum in physical metal that must be paid by employers or the buyer in a contract.

Otherwise all the physical metal will stick to the hands of banks and the top .1% who will pass banknotes down to the lesser entities. Hence, all the little or local banks will function at a great disadvantage and all the notes, for ease of recognition, will be issued to the biggest banks, who will also be the recipients of physical metal for those that need the flexibility of widely-recognized bank notes.

Shit, it's the reason bankers dress up so well. It was all about respectability in the banknote days.

Reality says

What enables a dictatorial regime is not the specific mineral per se, but the dollar value and its ability to buy support from cronies and buy violence to suppress the public. That is precisely what a Fiat Money Central Banking system is (until the currency it prints is universally rejected). The US is effectively having a giant mine that spits out trillions of dollars, the mine is the fiat money central banking system . . . and that is why the republic is gradually breaking down!

Great comparison, didn't think of Printing Press of World Reserve Currency = Abdundant Oil or other useful resource.

There's only about 550000 metric tons of silver in the world. There is only about 208874 metric tons of gold in the world. With the population of 1st world countries being about 1 billion, there is simply not enough of the commodity for it to be used as a currency.

Misc says

There's only about 550000 metric tons of silver in the world. There is only about 208874 metric tons of gold in the world. With the population of 1st world countries being about 1 billion, there is simply not enough of the commodity for it to be used as a currency.

We don't know the true numbers for one, and for another, we can subdivide both gold and silver to the point they are sizes of peas. The idea that "there isn't enough" is just false.

The financial attack on these metals is being done because it would crash the system if everybody just bought a small amount of each. Our financial system is just a scam, and eventually, that will correct.

AmericanKulak says

Employers will be paying employees with paper banknotes

Cool story bro but it still has nothing to do with the fact that our government functioned best when we had sound money and government could not print money out of thin air.

Private Banks are a separate issue. They need separate regulations. But depositors should work with banks at their own risk. With sound money people don’t need banks.

richwicks says

Misc says

There's only about 550000 metric tons of silver in the world. There is only about 208874 metric tons of gold in the world. With the population of 1st world countries being about 1 billion, there is simply not enough of the commodity for it to be used as a currency.

We don't know the true numbers for one, and for another, we can subdivide both gold and silver to the point they are sizes of peas. The idea that "there isn't enough" is just false.

The financial attack on these metals is being done because it would crash the system if everybody just bought a small amount of each. Our financial system is just a scam, and eventually, that will correct.

It would be smaller than peas. It would have to be flakes There simply isn't enough. You work for 2 weeks...here's your flake of silver.

Misc says

The savings rate would by necessity be much higher than the rate at which the metal is mined.

Without social security, a savings rate of 20% would be very low.

You have not addressed this fundamental flaw with the system. It leads to the system collapsing. A commodity based system is not stable.

Also, if you are promoting a commodity based system, you should have some idea of how much of the commodity is being added per year.

I have quoted the entire comment here, but don't see any answer to the specific question regarding your source for the 0.9% and 1.8% numbers. Did you pull those numbers out of thin air? The fear of running out of monetary metal is a little like the fear of running out of oil or the perennial claim of "only 30 years of oil reserve left" that lasted since 1860's. Commodity supply / "reserve" is dependent on price; price motivates new discoveries and new mining.

Your 20% saving rate hypothesis for individuals is nonsensical: a person may save during his productive years (that's even before touching the issue of a high productivity person likely invest savings after having 6mo cash on hand instead of piling up more cash), but will be a net-spender during his retirement; or his heirs will. Even if he takes his gold and silver to the grave, the tomb raiders will spend it for him! Out of hundreds of Pharoahs, only Tutenkarmon's tomb (or what was alleged to be his tomb) was relatively unraided, until the 20th century. The only hoarders that have proven somewhat successful at hoarding at a consistency that has economic consequence are institutions like coordinated banks after putting in place a gold-only standard . . . so that the institutions can run their fraudulent warehouse receipt scam in order to control the inflation and deflation cycles.

Misc says

There's only about 550000 metric tons of silver in the world. There is only about 208874 metric tons of gold in the world. With the population of 1st world countries being about 1 billion, there is simply not enough of the commodity for it to be used as a currency.

Silver is 10-20 times more common than gold in the first few hundred feet of the earth's surface. Looking at the 2.5x ratio in your numbers should have told you that silver is not being treated as monetary metal currently but as an industrial metal. There is only a couple month's above-ground storage of oil on this plant; how can the world survive on so little oil? The answer is quite simple: as industrial commodity, oil and silver are largely flow material. If the price is higher, more will be mined and prospected.

Misc says

It would be smaller than peas. It would have to be flakes There simply isn't enough. You work for 2 weeks...here's your flake of silver.

LOL! Why would you then work there instead of working for the silver mines directly? A worker operating modern mining equipment at a silver mine in the US can produce much more silver every day. Commodity based Bimetalism allows the public to increase money supply on their own, instead of making money creation an exclusive domain of the banksters that can coordinate each other to create synchronized inflation/deflation cycles.

Silver was the defacto money of the world from circa 10th century (very much behind the rebirth of market economy in Europe hundreds years after the collapse of Roman fiat money economy; the center of that silver economy was Troyes in northern France, hence the Troy Ounce and Troy Pound we know today) through the 18th/19th century (when banksters forced gold-only standard on the world in preparation for fraud money / fiat money).

Here it is

https://www.google.com/search?q=amount+of+gold+in+the+world&sxsrf=APwXEddih0Cm5n-gogdrspLmXXmSwEKMuw%3A1680359110731&source=hp&ei=xj4oZK62KsjmkPIP-Y6-oAM&iflsig=AOEireoAAAAAZChM1kV-HK_RWoCPAToNR7sFpXQwtxNP&oq=&gs_lcp=Cgdnd3Mtd2l6EAEYBTIHCCMQ6gIQJzIHCCMQ6gIQJzIHCCMQ6gIQJzIHCCMQ6gIQJzIHCCMQ6gIQJzIHCCMQ6gIQJzIHCCMQ6gIQJzIHCCMQ6gIQJzIHCCMQ6gIQJzIHCCMQ6gIQJ1AAWABgkzBoAXAAeACAAQCIAQCSAQCYAQCwAQo&sclient=gws-wiz

https://www.google.com/search?q=amount+of+silver+in+the+world&sxsrf=APwXEdcTtdu2ggv0Jn9iLc7cKT2TXq5-7A%3A1680359119022&ei=zz4oZJuIAfTCkPIPzLWI-A0&oq=amount+of+gold+in+the+world&gs_lcp=Cgxnd3Mtd2l6LXNlcnAQARgIMgoIABBHENYEELADMgoIABBHENYEELADMgoIABBHENYEELADMgoIABBHENYEELADMgoIABBHENYEELADMgoIABBHENYEELADMgoIABBHENYEELADMgoIABBHENYEELADMgoIABCKBRCwAxBDMgoIABCKBRCwAxBDSgQIQRgAUABYAGCnPmgBcAF4AIABAIgBAJIBAJgBAMgBCsABAQ&sclient=gws-wiz-serp

https://www.statista.com/statistics/253293/silver-production-volume-worldwide/

https://www.gold.org/goldhub/data/gold-production-by-country?gclid=CjwKCAjwrJ-hBhB7EiwAuyBVXQZMwkN2ojfVVgpeEVii4wwBYI6ZJCrKIU_KxTcUFyXXxH-qpb5chhoCxEsQAvD_BwE

Yes, with any reasonable savings rate the rate of addition at about 1% collapses the system.

There is also about $28 trillion in bank deposits and money market accounts in this country alone, not even including the other outstanding bonds. I will let you do the math to determine the size of silver flakes that a person would receive for 2 weeks worth of work.

A commodity based system is crap.

As expected, your numbers are crap. Current silver production volume worldwide is not the same as growth rate of above-ground silver in the world, just like oil production worldwide is not the same as growth rate of above-ground oil storage in the world. Both silver and oil are being treated as industrial material, not stored monetary commodity. If/when Silver becomes monetary commodity, price will make the above-ground storage (i.e. a proxy of base money supply when it is monetary metal) increase at 10x to 20x of the current gold above-ground storage increase per year or higher (as gold is currently treated as monetary metal in some context, but not fully) simply because that's the equilibrium point between mining silver vs. mining gold as silver is 10x to 20x more abundant than gold in earth accessible to current mining technology/capital.

Misc says

Yes, with any reasonable savings rate the rate of addition at about 1% collapses the system.

First of all, the monetary metal increase per year would be much higher than the alleged "1% industrial mining rate" (which is meaningless because the annual industrial consumption is more than the mining output, thanks to continued draw down of above-ground silver that had been mined from before demonetization of silver in the 1870's). Then "savings rate" is also non-sensical to the discussion: a person can not take silver off the plant when they die, so whatever is "saved" during his work years have to be disgorged during his retirement or his heirs will (or tomb raiders will).

Misc says

There is also about $28 trillion in bank deposits and money market accounts in this country alone, not even including the other outstanding bonds. I will let you do the math to determine the size of silver flakes that a person would receive for 2 weeks worth of work.

LOL! Then by the same logic as your argument how much cash is sitting at the Federal Reserve? Near-zero! compared to the $28 trillion. Goes to the show the fraud of the fiat money system. If you are not happy to work with current pay, a silver-based money under bimetallism would allow the worker to go work for a silver mine as a way of having a higher pay. Whereas in a fiat money system, the average worker has no alternative when faced with bankster coordinated monetary tightening (or loosening when prices go up for lives' necessities, as his paper money can be infinitely duplicated by a group of central controllers highly susceptible to corruption). While gold-only standard would result in gold flakes for average weekly pay due to the rarity of gold (hence quickly leading to circulating money on the market being dominated by warehouse receipts and frauds), because silver is 10x to 20x more common than gold in the earth's crust (that is accessible to human mining effort) silver coins as the transacting currency of the world have had a long history of coin being large enough to be easy/durable to handle, thousands of years of history.

The size of the Fed's balance sheet is about $8.7 trillion.

This monetary base can be increased or decreased as needed. Unlike a commodity based system.

You are arguing that the production of gold and silver can go up at an exponentially increasing rate. This would keep up with not only increasing population but an increased need for savings as well. Mathematically this cannot occur.

You still have not done the math to tell us the size of the silver flake that would be given for 2 weeks worth of work.

Also, you seem to be arguing that the monetary base (silver) can increase by 10-20 times its current size. How in the world is this better than fiat?

Misc says

The size of the Fed's balance sheet is about $8.7 trillion.

Does that include all the MBS from 2008? Does the Fed really have any assets beyond the ability to print infinite dollars?

Onvacation says

Misc says

The size of the Fed's balance sheet is about $8.7 trillion.

Does that include all the MBS from 2008? Does the Fed really have any assets beyond the ability to print infinite dollars?

Yes, that includes the MBS from 2008. Don't get me wrong I don't believe the Fed knows what it is doing. If marked to market, it's holdings would be a negative trillion dollars roughly. They lost over $9 trillion dollars last year ---- Brilliant ! ! !

It is the fiat system that is sound whereas a commodity based system must collapse.

Misc says

You are arguing that the production of gold and silver can go up at an exponentially increasing rate. This would keep up with not only increasing population but an increased need for savings as well. Mathematically this cannot occur.

The same can be argued for the FEDs printing of dollars.

Just a matter of time before the dollar goes Zimbabwe. I don't expect it to last more than a couple hundred more years.

Misc says

It is the fiat system that is sound whereas a commodity based system must collapse.

Because you say so?

fiat
fē′ət, -ăt″, -ät″, fī′ăt″, -ət
noun
An arbitrary order or decree.
Authorization or sanction.
An authoritative command or order to do something; an effectual decree.
The American Heritage® Dictionary of the English Language, 5th Edition.

How much more money can they print before the world says, "No More!"?

There are physical limitations to commodities. The same is not true for a simple mathematical system. Fiat can increase exponentially. Commodities cannot.

Finite precious metals vs infinite (theoretically) fiat, which will stand the test of time?

Misc says

The size of the Fed's balance sheet is about $8.7 trillion.

That is only an account entry (with little meaning, as it is not marked to market), not the amount of cash sitting at the Fed, like you were insisting on the world not having enough silver for money.

This monetary base can be increased or decreased as needed. Unlike a commodity based system.

Therein lies the source of great corruption and abuse of power. If a country has a trillion dollar silver mine (or oil well, or gold mine) easily mineable by the government (or appointed cronies), then that country is almost guaranteed to be corrupt and dictatorial, not answerable to the public in that country, as monopolistic control of that mineral wealth can buy cronies and buy violence for suppressing the public. The FED's printing machine is that easily tapped mineral wealth, and the reason why our republic is breaking down.

You are arguing that the production of gold and silver can go up at an exponentially increasing rate. This would keep up with not only increasing population but an increased need for savings as well. Mathematically this cannot occur.

Strictly speaking population growth can not increase exponentially indefinitely, because the earth's surface and volume are finite. Not even solar power is infinite, because the Sun is finite in size and mass. The mining of gold and silver can go up significantly if the prices are higher. Worrying about using them up is even sillier than worrying about running out of oil (assuming you understand the abiogenic origin of oil): unlike oil, silver and gold are not even consumed in monetary use but only pass from one to another. "Savings use" is a silly thing to worry about: people with highest incomes would reinvest most of their "savings" after having a 6-month cash reserve instead of holding on cash metal which would incurr storage fee when the amount of huge; whatever a person saves in cash does not disappear when he dies, so whatever he saves in cash metal during his working life would have to be disgorged in his retirement, or to be disgorged by his heirs, or to be disgorged by tomb raiders.

You still have not done the math to tell us the size of the silver flake that would be given for 2 weeks worth of work.

That's about as silly as asking how many square feet of bedroom room space should be paid for the worker. If there is not enough residential housing, more gets built while more workers get put to work building them. The eventual equillibrium point is anchored by the cost of mining silver vs. worker productivity.

Also, you seem to be arguing that the monetary base (silver) can increase by 10-20 times its current size. How in the world is this better than fiat?

First of all, I never said that. What said was annual silver production volume would be increased to 10x to 20x current gold production volume or more (if and when silver becomes monetary metal again). Current worldwide gold production volume is about 3000 metric tons, so 10x to 20x that would be 30,000 to 60,000 metric tons. Total amount of above-ground silver in the world is currently estimated to be between 550,000 metric tons to 1.6 million metric tons. However, in Bimetallism, the base money would have to take into account about 200,000 metric tons of gold, which at 16:1 ratio would be equivalent to 3.2 million metric tons of silver for monetary purpose. Likewise at 16:1 ratio, the 3000 metric tons of gold annually produced would be equivalent to 48,000 metric tons of silver. So the combined output would be about 78,000 - 108,000 metric tons of silver-equivalent vs. close to 4-5 million metric tons (silver-equivalent; i.e. silver + goldx16)) of current above-ground in storage, or about 2% . . . remarkably close to the FED's 2%-3% inflation goal! Except in this case the mining would be dynamically adjusted by the market with tens of thousands of participants instead of a handful of PhD's easily controlled by banksters because they can't find a better job elsewhere. Also, the difference between likely reality vs. a "goal" (that the FED has had no history of achieving despite "hedonic adjustments" to cook the books on statistics)

Edit:
Another major difference: the FEDpos;s 2-3% is price inflation goal (after cooking books vis hedonic adjustment, owner's equivalent rent, etc..), whereas the 2% monetary metal increase may not result in price inflation at all if productivity in general economy is increasing by 2% annually or more.

PeopleUnited says

Cool story bro but it still has nothing to do with the fact that our government functioned best when we had sound money and government could not print money out of thin air.

Private Banks are a separate issue. They need separate regulations. But depositors should work with banks at their own risk. With sound money people don’t need banks.

Apples and Oranges. Our government functioned better because it was severely constrained by the Constitution, no Income Tax, and no Central Bank --- and no resource distributors voting (ie 19th Amendment - Women).

We spent the turn of the Century fighting over silver vs. gold vs. bimetalism. "You shall not crucify this country... upon a cross of Gold" was a famous political speech.

There were many panics and local busts during the Gold Era and most of them were brought upon by Wildcat banks that couldn't honor all the paper they spewed out relative to their metal deposits.

Good luck schlepping sacks of metal to buy land or a house in cash. Much less an airline delivering metal money for aircraft.

The practical result of commodity fetish, especially Gold, is what 19th Century people called "Shinplaster":






Because once the bank went under, that was the only thing your gold banknote was good for - padding for your legs.

Imagine Silicon Valley Bank, but with paper bank notes given to the depositors. Where is the FDIC going to get billions in gold coin?

TRUST THE BANKS! Give 'em your Gold, and Take their paper!

Gold currency in reality:


Again, there would have to be a mandate that institutions are required to pay a minimum distribution of the physical metal out to clients and employees and contractors. Say, 10%.

So if somebody withdrew $1000 from a bank, the bank MUST pay $100 of that in metal. Ditto for paying a handyman for laying tile or an employer paying an employee.

PeopleUnited says

With sound money people don’t need banks.

LOLwhat? Are we supposed to keep our "sound money" under a mattress or buried in a tin can under a peach tree? How the fuck that "no need banks" shit would work for somebody not living hand to mouth? You seriously suggesting that I should keep my couple of million $$ in savings at home, thus painting a huge target for a home invasion on my back? Or shall I hire private security to guard my house 24x7? The cost of that won't be trivial.

RWSGFY says

LOLwhat? Are we supposed to keep our "sound money" under a mattress or buried in a tin can under a peach tree?

They could store it in their Tiny House

RWSGFY says

You seriously suggesting that I should keep my couple of million $$ in savings at home, thus painting a huge target for a home invasion on my back? Or shall I hire private security to guard my house 24x7? The cost of that won't be trivial.

Did you actually keep $2mil in cash savings account when the interest rate was less than 0.25% while the price inflation rate was double-digits despite all the hedonic adjustments, box-shrinking and owners' equivalent of rent? You must have lost well over $200k in purchasing power per year during that time, well in excess of the cost of having a dedicated security system (is that even necessary when dealing with only 1000 ounces of gold weighing less than 70lbs? BTW, $2million in $100 bills would weigh $44lbs, so not that far from gold weight at current price; give it another 5-6 years of inflation as low as 5% per year would make the two weights equal to each other). In any case, why didn't you invest that money in some productive assets that would throw off yield instead of cash sitting in a savings account that yielded practically nothing while inflation was eating you alive.

AmericanKulak says

Because once the bank went under, that was the only thing your gold banknote was good for - padding for your legs.

Imagine Silicon Valley Bank, but with paper bank notes given to the depositors. Where is the FDIC going to get billions in gold coin?

TRUST THE BANKS! Give 'em your Gold, and Take their paper!

Combined with your excellent earlier comment on banks discounting each other's notes, what would have happened in a sound money banking system would be other banks deeply discounting SVB notes when it was lending money to borrowers that no other banks would lend while on condition of SVB being their exclusive banks, essentially creating a much lower value SVB-dollar plantation script. Banks discounting each other's notes would have made the unsound lending practice easily visible, consequently depositors would have withdrawn sooner and stopped the pyramid scheme in much earlier stages. What the fiat money banking system and unlimited FDIC insurance have done is incentivize bad banking practices and reward/incentivize the wealthy/relatively-independent segment of the population to become stupid and lazy. It's the monetary equivalent of having centrally controlled electronic voting machines casting the votes instead of letting informed voters vote . . . which obviously leads to dictatorships and/or fake cardboard cut-out leaders

Incidentally, deeply discounted SVB notes would also have prevented Californians buying up land and homes in Texas and other red states, turning (parts of) them blue and just as broken. The spread of undiscounted SVB-dollars is having a Gresham's Law effect: fraud money chasing out good money under fiat money standards.

RWSGFY says

LOLwhat? Are we supposed to keep our "sound money" under a mattress or buried in a tin can under a peach tree? How the fuck that "no need banks" shit would work for somebody not living hand to mouth? You seriously suggesting that I should keep my couple of million $$ in savings at home, thus painting a huge target for a home invasion on my back? Or shall I hire private security to guard my house 24x7?

Here’s an idea, leave your alleged $2 million in a bank, so that the real professional criminals (banksters) can have custody of it.

Yeah, that sounds like a good plan.

AmericanKulak says

There were many panics and local busts during the Gold Era and most of them were brought upon by Wildcat banks that couldn't honor all the paper they spewed out relative to their metal deposits.

Yes like I said, private banks need their own regulations.

But sound money is a government thing not a private bank thing. A government that can steal your money through taxes and inflation has too much power. A government that has the power to literally print money on a whim just because it wants to spend more will become a criminal government. Hence the government you have and yet you defend the criminals to the last breath, and all the while they continue to enslave you. Get ready for your CBDC, you are going to love that even more.

AmericanKulak says

Good luck schlepping sacks of metal to buy land or a house in cash. Much less an airline delivering metal money for aircraft.

This doesn’t even make sense on the surface.

Here is what an acre of land sold for in 1900.


If we had sound money the price for that same acre of land today may have gone up or down some, but still would be relatively close to that same $20.

Do you understand what sound money means? It means money retains its value and prices for most goods, and necessities don’t rise to 250 times what they were in 1900.

PeopleUnited says

Do you understand what sound money means? It means money retains its value and prices for most goods, and necessities don’t rise to 250 times what they were in 1900.

I do. And I love taking money out of the hands of government.

Buuuuuut, I'm not putting it in the hands of banks.

Again, we saw what happened in the 19th. The Banks and top 0.1% soaked up all the gold, and gave out paper.

If you had a banknote for $100 in gold and went to another bank or tried to use it somewhere else, you got less than $100 for it, and often a 5% discount. You lost 5%+ of your money with gold-backed banknotes in many transactions.