I'm tired of hearing the US Dollar is worthless

Yes the money is called "fiat money" because it no longer is backed by Gold.

But it is backed by something.

It's called your clothes, your lamp shades, your carpet, your door mat.

It's backed by the food you stuff your face with, it's backed by your house.

Groups of economists determine what their nation's GDPs are and value their currency based on many things but ultimately on your total liquidatable national "worth".

That is - a lamp costs 30 dollars, it now backs 30 dollars worth of material.

Etc.

The money isn't worthless - it just changed the tangible backing from Gold in the bank to your neighbors $30,000.00 car.

Why dont you try creating your own money out of thin air and see how well that goes over. Good luck!

The only thing backing the U$D is the fact that the Government imposes Federal "Legal Tender" Laws forcing you to accept the dollar in all transactions, pay your employees in dollar denominated assets, and most important TAXES are to be payed in dollar.

Without the Fed's restrictions, nobody would use this toilet paper currency. They crack down on all competition because they know the dollar is worthless. Thats why they're trying to lock people up for using the "Liberty Dollar".

I could.

I could take all my belongings - print "spicie" and divide the market value of my belongings with the number of spicie printed - and create unit values for that currency.

The two problems are no one would care to accept it as money (even if the money was a written contract entitling a person to a specific value of my belongings) ... and the second problem is the US Government makes it such that only US currency is legal tender in the United States (for sake of a common market).

Anyway I shouldn't have to describe more than that that the US Dollar is a contracting bill.

It promises you a certain value of goods in exchange for whatever you want with it - it is signed and notarized by the Treasurer and Secretary of the Treasury.

Yeah, but your clothes, etc. are made in Taiwan. So your collateral doesn't even reside here.

Check into it a bit more. Let me know if you still feel all comfy once you're through.

Vallhall makes an excellent point.

Nike shoes are made in China, you can buy a pair in Hong Kong in a street market for $5 USD, or $170 USD at your local Finishline or Payless. Talk about inflation!

Originally posted by Stratrf_Rus
Yes the money is called "fiat money" because it no longer is backed by Gold.

But it is backed by something.

It's called your clothes, your lamp shades, your carpet, your door mat.

It's backed by the food you stuff your face with, it's backed by your house.

The only thing that the money is backed by, is your belief that it is actually worth something. When the peoples belief falters, then there is no true support for the dollar.

The national savings rate for most people has dwindled to nothing. People have switched thier backup bank account to credit cards and home equity loans. People no longer have a vested interest in backing the dollar because they have nothing to lose except debt.

yes but those items are usually made overseas and have another value somewhere else other then the one you payed for with dollars, so that lamp you payed 30 dollars for could be worth 10 dollars over in china in their equivalent currency. so my point is even if you back your currency up with items, those items are worth something else somewhere else, so backing up your currency with items that value changes depending on location in the world is a silly thing to do.

now the beauty of gold is its value hardly changes, yea it can rise and fall a few dollars/pounds/rubals etc.. (whatever your currency of choice is) but it almost always stays around the same level in value worldwide, this is why it is the backup of choice for currency's worldwide.

Money is a medium or means of exchange. It is worthless. What backs the US dollar? THe products we make. The world's largest companies who export jobs. The world's largest navy and airforce. The ability to finance the economy of these piss poor backwoods asian nations such as china and india.

Hi,

According to www.amerocurrency.com...
the US Dollar is going away upon the upcoming merger of the US and Mexico (to form the North American Union).

As US sovereignty is eliminated, the Amero is to become the currency for the new socialist country.
www.tucsoncitizen.com...


The NAFTA superhighway will spearhead the loss of sovereignty and the transition to the NAU, as described here:
www.infowars.com...
www.amerocurrency.com...
www.newswithviews.com...

Originally posted by Valhall
Yeah, but your clothes, etc. are made in Taiwan. So your collateral doesn't even reside here.

Check into it a bit more. Let me know if you still feel all comfy once you're through.

Yeah, but we could slaughter the Chinese like pigs if we felt like it. The US dollar is backed by US military power.

Now your just getting silly. We could slaughter the Chinese like pigs? And how exactly would that make the dollar worth something? Since right now its not backed by anything...except maybe debt.

I am at no fault for your current ignorance. Do you honestly think we live in a Walt Disney world? I hope not.

This world is filled with thieves, beggers, swindlers, gypsies and the like.

The United States did not become the United States because we never kicked the British's ass twice, put an end to the Barbary pirates, went through a civil war, killed disenting Indian tribes, financed wars in South America, Killed Germans and Nazis, killed millions of Koreans and Vietnamese, funded the war on drugs, funded the war on terror, funded Saddam to attack Iran, attacked Iran and funded countless corrupt and/or murderous regimes, guerilla groups, rebel groups, revolutionaries and the likes. No siree bob.

We became the most powerfull country in the world by lying down on our faces and shouting 'thank you sire may I have another'.

I am at no fault for your current ignorance. Do you honestly think we live in a Walt Disney world? I hope not.

This world is filled with thieves, beggers, swindlers, gypsies and the like.

The United States did not become the United States because we never kicked the British's ass twice, put an end to the Barbary pirates, went through a civil war, killed disenting Indian tribes, financed wars in South America, Killed Germans and Nazis, killed millions of Koreans and Vietnamese, funded the war on drugs, funded the war on terror, funded Saddam to attack Iran, attacked Iran and funded countless corrupt and/or murderous regimes, guerilla groups, rebel groups, revolutionaries and the likes. No siree bob.

We became the most powerfull country in the world by lying down on our faces and shouting 'thank you sire may I have another'.

Originally posted by Stratrf_Rus
But it is backed by something.

It's called your clothes, your lamp shades, your carpet, your door mat.

It's backed by the food you stuff your face with, it's backed by your house.

Dude your money is not backed by the things you purchase with it. First off things you buy are marked up to be sold at a far higher rate than they are really worth. And once purchased they don't hold that same value.
For example an eye glasses frame that costs the optician $7 will sell for $70, so using your logic the opticians money is backed by a much lower value item than the retail purchaser of the glasses?

Try turning your clothes into a bank for the amount you purchased them for.
Try selling anything you own for what you paid for it.

When you pay full retail you are losing money, not making an equal exchange.
Prices will go as high as people are willing to pay regardless of what the product is really worth, or how much it costs to manufacture.

Originally posted by Soitenly
The United States did not become the United States because we never kicked the British's ass twice,

Twice? Pray tell when the second time was?

Originally posted by Soitenly
put an end to the Barbary pirates,

That was the Royal Navy mostly with some US assistance... I see that fact has become another U-571 myth....

The RN also spent around 40 years trying to stop your slaves arriving....

But anyway, on topic. From my point of view, as a Brit, your dollar is worthless. At nearly 2 dollars to the pound, items you think are expensive are not for us.

In the UK, I am a average wage earner, bringing in around £30K/year. In US$, thats almost $60k.

Whats the average wage in the US?

INWT got it right.

A Federal Reserve Note is just that, a NOTE. Like your car note. It's debt pure and simple, and it's value is entirely dependent on the world's confidence in our ability to repay. Since the USA is more or less insolvent, I don't see that confidence lasting much longer.

Originally posted by stumason

Originally posted by Soitenly
In the UK, I am a average wage earner, bringing in around £30K/year. In US$, thats almost $60k.

$60,000.01

Seriously, we need the British. They have administration over many islands around the world where the US Navy docks. Though I reckon by the time we have bankrupted the Brits, they will be selling us those islands...

I think the following quick selections i made from otherwise VERY illuminating articles will serve to get everyone thinking in the right direction. I any of you can find the time to read these articles you will most certainly not regret it probably become as well informed on this particular as any lay person needs to be to take action and change the system.

The financial press reported last week that the euro, the new currency created only five years ago and used by most European nations, has supplanted the U.S. dollar as the most widely used form of cash internationally. There are now more Euros in circulation worldwide than dollars.

This alone is not necessarily troubling, as the dollar remains the world’s most important reserve currency. About 65% of foreign central bank exchange reserves are still held in dollars, versus only about 25% in euros. And the European Central Bank faces the same inflationary pressures that our own Federal Reserve Bank Governors face, including a growing entitlement burden that threatens economic ruin as both societies age. European politicians want to spend money just as badly as American politicians, and undoubtedly will clamor to inflate-- and thus devalue-- the euro to fund their creaky social welfare systems.

Still, the rise of the Euro internationally is another sign that the U.S. dollar is not what it used to be. There is increasing pressure on nations to buy and sell oil in euros, and anecdotal evidence suggests that drug dealers and money launderers now prefer euros to dollars. Historically, the underground cash economy has always sought the most stable and valuable paper currency to conduct business.

The World's Reserve Currency

But the world was content to accept those dollars for more than 25 years with little question-- until the French and others in the late 1960s demanded we fulfill our promise to pay one ounce of gold for each $35 they delivered to the U.S. Treasury. This resulted in a huge gold drain that brought an end to a very poorly devised pseudo-gold standard.

It all ended on August 15, 1971, when Nixon closed the gold window and refused to pay out any of our remaining 280 million ounces of gold. In essence, we declared our insolvency and everyone recognized some other monetary system had to be devised in order to bring stability to the markets.

During the 1970s the dollar nearly collapsed, as oil prices surged and gold skyrocketed to $800 an ounce. By 1979 interest rates of 21% were required to rescue the system. The pressure on the dollar in the 1970s, in spite of the benefits accrued to it, reflected reckless budget deficits and monetary inflation during the 1960s. The markets were not fooled by LBJ’s claim that we could afford both “guns and butter.”

Once again the effort between 1980 and 2000 to fool the market as to the true value of the dollar proved unsuccessful. In the past 5 years the dollar has been devalued in terms of gold by more than 50%. You just can’t fool all the people all the time, even with the power of the mighty printing press and money creating system of the Federal Reserve.

The End of Dollar Hegemony

Runaway inflation is a well-known phenomenon. It leads to political and economic chaos of the kind we witnessed in New Orleans. Hopefully we’ll come to our senses and not allow that to happen. But we’re vulnerable and we have only ourselves to blame. The flawed paper money system in existence since 1971 has allowed for the irresponsible spending of the past 30 years. Without a linkage to gold, Washington politicians and the Federal Reserve have no restraints placed on their power to devalue our money by merely printing more to pay the bills run up by the welfare-warfare state.

This system of money is a big contributing factor in the exporting of American jobs, especially in the manufacturing industries.

Since the last link to gold was severed in 1971, the dollar has lost 92% of its value relative to gold, with gold going from $35 to $450 per ounce.

Major adjustment of the dollar and the current account deficit can come any time, and the longer the delay the greater the distortions will be in terms of a correction.

In the meantime we give leverage to our economic competitors and our political adversaries, especially China.

The current system is held together by a false confidence in the U.S. dollar that is vulnerable to sudden changes in the economy and political events.

The Coming Category 5 Financial Hurricane

Since gold has proven to be the real money of the ages, we see once again a shift in wealth from the West to the East, just as we saw a loss of our industrial base in the same direction. Though Treasury officials deny any U.S. sales or loans of our official gold holdings, no audits are permitted so no one can be certain.

The special nature of the dollar as the reserve currency of the world has allowed this game to last longer than it would have otherwise. But the fact that gold has gone from $252 per ounce to over $600 means there is concern about the future of the dollar. The higher the price for gold, the greater the concern for the dollar. Instead of dwelling on the dollar price of gold, we should be talking about the depreciation of the dollar. In 1934 a dollar was worth 1/20th of an ounce of gold; $20 bought an ounce of gold. Today a dollar is worth 1/600th of an ounce of gold, meaning it takes $600 to buy one ounce of gold.

Though M3 is the most helpful statistic to track Fed activity, it by no means tells us everything we need to know about trends in monetary policy. Total bank credit, still available to us, gives us indirect information reflecting the Fed’s inflationary policies. But ultimately the markets will figure out exactly what the Fed is up to, and then individuals, financial institutions, governments, and other central bankers will act accordingly. The fact that our money supply is rising significantly cannot be hidden from the markets.

What the Price of Gold is Telling Us

Since 1975, practically all the gains in household income have gone to the top 20% of households.

cia.gov...

Stellar

the US dollar is still a desired commodity, at the moment

but the future of it's worth does not look so bright, ? how so, you ask

Throughout the wide range of businesses & corporations that are a big part of the USA economic engine,
the upper echelon executives & elites are feathering their retirement nests with outrageous dollar ammounts
to carry them thru an expected 20-30 years of retirement!

take for example the very recent/in the news 'Platinum Parachute" which the Home-Depot CEO had revealed to the public...some $210,000,000.00
on top of he +$250M he amassed in the last years of his tenure...
1 man raking in a HALF-A-BILLION for his ?tax eluding maneuverings?

at any rate, those in-the-know,
i.e.: the elites in the unrestrained capatalist monster called Free Market economy,
are evidently cetain that they will need a money reserve more than 1000% larger than did the affluent of just 4 years ago.

that is, these elites , not be be deprived of a retirement of priveledge
are using reasonable projections that 'the dollar' will,
in the forseeable future be worth about 1/2 cent to the dollar.

~now, that's something to think about~

[edit on 8-1-2007 by St Udio]