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History
See other History Articles

Title: Hitler's Monetary System
Source: Rense
URL Source: http://www.rense.com/general77/hitn.htm
Published: Jul 15, 2007
Author: Rense
Post Date: 2007-07-15 00:50:08 by robin
Keywords: None
Views: 1209
Comments: 85

Hitler's Monetary System 7-14-7

"We were not foolish enough to try to make a currency coverage of gold of which we had none, but for every mark that was issued we required the equivalent of a mark's worth of work done or goods produced. . . .we laugh at the time our national financiers held the view that the value of a currency is regulated by the gold and securities lying in the vaults of a state bank." -Adolf Hitler, 1937 (CC Veith, Citadels of Chaos, Meador, 1949.)

"And it proved sound. It worked. In less than ten years Germany became easily the most powerful state in Europe. It worked so magically and magnificently that it sounded the death knell of the entire (Zionist) Jewish money system. World Jewry knew that they had to destroy Hitler's system, by whatever means might prove necessary, or their own [system of usury] would necessarily die. And if it died, with it must die their dream and their hope of making themselves masters of the world. The primary issue over which World War II was fought was to determine which money system was to survive. At bottom it was not a war between Germany and the so-called allies. Primarily it was war to the death between Germany and the International Money Power." --William Gayley Simpson, 'Which Way Western Man' (p.642)

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#1. To: All, Eoghan, Cynicom (#0)

comments?

Ron Paul for President

robin  posted on  2007-07-15   0:50:46 ET  Reply   Trace   Private Reply  


#2. To: robin (#1)

We were not foolish enough to try to make a currency coverage of gold of which we had none, but for every mark that was issued we required the equivalent of a mark's worth of work done or goods produced. . . .we laugh at the time our national financiers held the view that the value of a currency is regulated by the gold and securities lying in the vaults of a state bank

Actually this is a good and valid system...far far better than any gold standard. It is completely anti-inflationary and the basis of a fiscal rather than monetary economy.

Far superior to a monetarist manipulation system.

IMNSHO

JCHarris  posted on  2007-07-15   0:59:33 ET  Reply   Trace   Private Reply  


#3. To: robin (#1)

P.S. This is a capitalist rather than a monetarist system !!!

Look where monetarist economics took US !!

JCHarris  posted on  2007-07-15   1:00:49 ET  Reply   Trace   Private Reply  


#4. To: JCHarris, robin (#2)

but for every mark that was issued we required the equivalent of a mark's worth of work done or goods produced. . . .

Problem: Who's gonna make them accept a "mark" for their labor or goods? What if they don't want any marks?

The premise is that Germans would willingly trade their labor, which has value, for marks, which upon first exchange from the government to the laboror, have no value.

I'm curious, JC, what kind of monetary system you actually favor since you hold a gold backed currency in such contempt.

Pinguinite.com

Pinguinite  posted on  2007-07-15   1:52:14 ET  Reply   Trace   Private Reply  


#5. To: robin (#0)

equivalent of a mark's worth of work done or goods produced.

There's the rub...work done, quality, quantity is total arbitration. You'd think the guy who supposedly wrote about and figured out the 'who and what' about the Big Lie could understand this general economic principle?

"And it proved sound. It worked. In less than ten years Germany became easily the most powerful state in Europe.

There's no real something from virtually nothing....I'd call it a Rothschild gold injection ceremony....

“Yes, but is this good for Jews?"

Eoghan  posted on  2007-07-15   2:33:23 ET  Reply   Trace   Private Reply  


#6. To: robin (#0) (Edited)

A cursory glance at our current system causes us to see a close similarity to Hitler's ... only he was not paying interest to the international bankers ... we are. Our currency has the same basis for existence ... work and production ... which production is being intentionally lessened causing a proportionate lessening of the value of our currency.

A gold standard isn't necessary if the currency is controlled by the governmental agency prescribed (Treasury), and any interest, if found necessary, would be paid to the treasury. Of course a transparent monitoring system should consist of an elected citizen panel to keep politicians and treasury officers honest.

If gold were to be made the standard ... the same folks that are fucking us today would be fucking us tomorrow. All commodities are "tradeable" for the value perceived by the traders.

Contemplate the mangled bodies of your countrymen, and then say 'what should be the reward of such sacrifices?' Bid us and our posterity bow the knee, supplicate the friendship, plough, sow, and reap, to glut the avarice of the men who have let loose on us the dogs of war to riot in our blood and hunt us from the face of the earth?

If ye love wealth better than liberty, the tranquility of servitude than the animated contest of freedom, go from us in peace. We ask not your counsels or arms. Crouch down and lick the hands which feed you. May your chains sit lightly upon you, and may posterity forget that you were our countrymen!”

noone222  posted on  2007-07-15   6:57:52 ET  Reply   Trace   Private Reply  


#7. To: robin (#0)

the NAZIs had a fiat system just like we have a fiat system - not backed by gold, money is just made out of thin air & spent. But the difference is that under the NAZI system the government created the money and did not charge interest for it. And in our system the bankers make the money and charge a large amount of money for it.

I advocate that the government should create the new money and use it to pay government expenses. In this way taxes could be reduced dramatically. and government could pay for infrastructure projects and other worthwhile endeavours without taxing the people to do it.

People are reluctant to say that this concept is good because they've been taught to think that government will increase the money supply so fast that it will cause inflation. If they increase it too fast, then this will cause inflation or debase the currency, that is true. But today the private sector bankers have a profit motive for creating money. and they have increased the money supply maassively to cause inflation. The great run-up in the stock values and the real estate values is a form of inflation itself. I contend that government would do better than these bankers at controlling the money supply responsibly. As long as there's no corruption where officials are taking money themselves, then there's no profit motive for government to run up the money supply too rapidly. but the private sector bankers inherently have a profit motive especially since they charge so much profit to make money.

People don't realize that 8-10% of our entire economy is spent each year to compensate one bank, the Federal reserve, for its money-creation services. That is like an 8-10% tax that we pay each year and strictly for the benefit of private wealth concentrated in a very few hands.

Galatians 3:29 And if ye [be] Christ's, then are ye Abraham's seed, and heirs according to the promise.

Red Jones  posted on  2007-07-15   7:31:40 ET  Reply   Trace   Private Reply  


#8. To: robin, all (#0)

I'm sorry, I don't know alot about this, but what about the insane amount of inflation they had?

"They must find it difficult... Those who have taken authority as the truth, rather than truth as the authority." ~ Gerald Massey

wudidiz  posted on  2007-07-15   7:51:21 ET  Reply   Trace   Private Reply  


#9. To: wudidiz (#8)

The insane inflation experienced in germany was in the 1920's. the NAZIs came to power in 1932. The NAZIs very quickly brought great prosperity to ordinary germans. The innovations they had in money creation were enormously successful.

another period in history where this same thing was done is in pre-1750 America. back then each colony created its own money from thin air. but it was the colony's government that did it, not a private bank. they would lend the money out for home-building and business-building. and then whoever borrowed the money had to pay it back, but paid it back without interest. In this way the Americans were able to build real prosperity & wealth for the people very quickly. It is this innovation that allowed the Americans to win the Revolutionary war. Just as the same type of innovation allowed germany to build itself up very quickly and do so well in the war as they did against so many opponents.

Galatians 3:29 And if ye [be] Christ's, then are ye Abraham's seed, and heirs according to the promise.

Red Jones  posted on  2007-07-15   8:28:05 ET  Reply   Trace   Private Reply  


#10. To: Red Jones (#7)

advocate that the government should create the new money and use it to pay government expenses. In this way taxes could be reduced dramatically.

Actually, taxes are an important way to ensure that a fiat currency is valued by the populace. If you could go to jail, or have your house seized, unless you have enough of that cabbage, you will make certain you keep some cabbage. Then your neighbors also need cabbage to keep their homes. Thus, taxes ensure that a floor demand exists for said cabbage.

As long as there's no corruption where officials are taking money themselves, then there's no profit motive for government to run up the money supply too rapidly.

The only way to purge public officials of corruption is to remove their power to regulate most aspects of human life. There is no prospect of avoiding corrupt public officials under our current governmental structure.

The U.S. Constitution is no impediment to our form of government.--PJ O'Rourke

DeaconBenjamin  posted on  2007-07-15   8:39:47 ET  Reply   Trace   Private Reply  


#11. To: Red Jones, All (#7)

But the difference is that under the NAZI system the government created the money and did not charge interest for it. And in our system the bankers make the money and charge a large amount of money for it.

That's a huge difference.

People don't realize that 8-10% of our entire economy is spent each year to compensate one bank, the Federal reserve, for its money-creation services. That is like an 8-10% tax that we pay each year and strictly for the benefit of private wealth concentrated in a very few hands.

That's insane.

Ron Paul for President

robin  posted on  2007-07-15   8:45:21 ET  Reply   Trace   Private Reply  


#12. To: noone222 (#6)

A cursory glance at our current system causes us to see a close similarity to Hitler's ... only he was not paying interest to the international bankers ... we are.

That's what Red posted too. So, usury rates of interest are a large part of the problem. Also the Federal Reserve.

Ron Paul for President

robin  posted on  2007-07-15   8:47:13 ET  Reply   Trace   Private Reply  


#13. To: robin (#12)

I'm not myself in favor of doing away with usury completely. I think that if a bank or other financial institution actually has money they'd like to lend out for interest, then i think they should be allowed to do it. But the problem is that bankers charge interest on money that they create out of thin air. they don't have the money to lend, they create it in order to lend it and then they charge interest on that. I don't think they should be allowed to do that.

It is not difficult for our economists and bureaucrats to come up with a target growth figure for the economy each year and then for government to increase the money supply by exactly that amount of money. This would keep inflation low. and if government decided to inflate, then it would be a public decision that everyone would be able to see. and we should be able to vote against our leaders who advocate the inflation. But the way it is now we have no control at all over the money supply growth. Because today it is a private sector group that controls our money supply and they don't even tell us any more how fast they increase the money supply.

Today the Federal reserve takes about 400 billion dollars each year from the US federal taxpayers alone. and then it takes a similar (slightly larger even) amount of cash each year from the 12 member banks who in turn squeeze it out of our economy through private lending. Private lending on money that was created out of thin air.

IMHO whoever creates the money out of thin air that is accepted as legal tender is the real ruler. and it is not the government who does that, it is a privately owned banking system. and it is not just any bank. Only the Federal Reserve and their 12 member banks are allowed to create US dollars.

There is the exception that recently in the last few years (under Bush actually) a new system has developed. In order to keep the government's debt to the Federal Reserve down the US government is now borrowing US dollars from foreign banks. the foreign banks have so many US dollars that are excess and they have to use somehow. This seems to be a means of rewarding these foreign banks for going along with the system.

It is a foolish presumption to think that the goal of our economic & monetary policy is to help the Americans or to facilitate anything good for us Americans. the goal is obviously to benefit a clique of private bankers. I believe the federal government spends 15-20% of all its revenue on servicing debt. Through a series of polices over a long period they've literally transferred the retirement money for tens of millions of Americnas to rich people. and on top of that they've brainwashed a very large portion of Americans into thinking that this is good.

I say they've taken the retirement money from us to give it to rich bankers because they have. Remember, they take 16% from every paycheck under 80 thousand a year. and then they take 40% of that money and use it on general revenue. they literally divert the money from the retirement fund it was intended for and put it in the 'general' fund. Which means it is used to service debt and to fund the war.

Galatians 3:29 And if ye [be] Christ's, then are ye Abraham's seed, and heirs according to the promise.

Red Jones  posted on  2007-07-15   9:05:22 ET  Reply   Trace   Private Reply  


#14. To: robin (#0)

The best book on the economy of Nazi Germany is the recent Wages of Destruction. Because of Hitler's big rearmament program, the Nazi government ran increasingly large deficits. Finally, it was obliged to invade other countries to seize assets and find a temporary fix to the problem.

Sound familiar?

To reason, indeed, he was not in the habit of attending. His mode of arguing, if it is to be so called, was one not uncommon among dull and stubborn persons, who are accustomed to be surrounded by their inferiors. He asserted a proposition; and, as often as wiser people ventured respectfully to show that it was erroneous, he asserted it again, in exactly the same words, and conceived that, by doing so, he at once disposed of all objections. - Macaulay, "History of England," Vol. 1, Chapter 6, on James II.

aristeides  posted on  2007-07-15   9:15:00 ET  Reply   Trace   Private Reply  


#15. To: aristeides, Red Jones, noone222 (#14)

Yes it does! So that needs to be factored in also.

Of course, Smirk and Cheney started with a surplus (however cooked in the books) and have brought us record deficits and an unpopular and evil war.

Whereas Germany had enormous debt/inflation and economic woes that were mostly fixed (I thought) and then invaded Poland etc.

Ron Paul for President

robin  posted on  2007-07-15   9:23:16 ET  Reply   Trace   Private Reply  


#16. To: Red Jones (#13)

But the problem is that bankers charge interest on money that they create out of thin air. they don't have the money to lend, they create it in order to lend it and then they charge interest on that. I don't think they should be allowed to do that.

Reminds me of something similar in my world; the sales team sells vaporware to unsuspecting clients. Then once it's been partly paid for and promised we're supposed to make it happen in an absurd amount of time.

Ron Paul for President

robin  posted on  2007-07-15   9:26:06 ET  Reply   Trace   Private Reply  


#17. To: robin (#12) (Edited)

Also the Federal Reserve.

The Federal Reserve Bank is not federal (it's private), it has no reserves, and it's not a bank. Try to open an account there.

Chickenhawk: the weakest link that squeaks the loudest.

YertleTurtle  posted on  2007-07-15   9:29:24 ET  Reply   Trace   Private Reply  


#18. To: YertleTurtle (#17)

Red's last post looks at this private club and what they're doing.

Ron Paul's the next best thing to Andy Jackson.

Ron Paul for President

robin  posted on  2007-07-15   9:34:16 ET  Reply   Trace   Private Reply  


#19. To: aristeides, historian1944 (#14)

An excellent read and a salutary reminder for people who, like myself, tend to focus on the political and military aspects of WW II, that there were other powerful forces at work as well. Tooze clearly shows that even absolute dictatorships just can't afford to neglect the balance of payments. He argues, convincingly, that Speer's "armaments miracle" wasn't much of a miracle after all, but to illustrate the point he seems to overstate the achievements of the German arms producers in the first three years of the war somewhat. For instance, it may be, as he states, that the number of "combat-worthy medium tanks" doubled from May 1940 to June 1941 (page 433), but this was an increase from a very small base (not much more than a thousand). Moreover, many of these tanks were Czech, and rather than being 36- and 38-ton tanks as Tooze states, they were in the 10-ton class, and clearly unsuited for the medium tank function they were expected to fulfill. The fact that the Germans were forced to keep the Czech TNHP tank, which did not have one single part in common with German tanks, in production (as the Pzkpfw. 38t) to make up the numbers already says a lot about the relative impotence of the German tank industry at that time. Medium tank production in June 1941, the month the Soviet Union was invaded, was 38 Mark IVs and 133 Mark IIIs (plus 65 Czech 38ts), decidedly unimpressive compared to US tank production, which starting from scratch reached one thousand per month in little over a year, or compared to Soviet tank production which soon reached comparable levels under unimaginably difficult conditions. Even taking into account reduced steel quotas for the army and other constraints, there still seems to be something of an "armaments mystery" for the first half of the war, even if there was no real "miracle" in the second half.

One Amazon review. Looks good, as does the commentary, thanks.

Ron Paul for President

robin  posted on  2007-07-15   9:36:40 ET  Reply   Trace   Private Reply  


#20. To: Red Jones, robin (#9)

The insane inflation experienced in germany was in the 1920's. the NAZIs came to power in 1932. The NAZIs very quickly brought great prosperity to ordinary germans. The innovations they had in money creation were enormously successful.

This prosperity was due to the exertions of Dr. Schacht the German Finance Minister. After Hitler came to power, the world banks were trying to force their way in but Schacht kept them out.

In 1938 when Hitler was intent on using his armaments for aggressive war, Schacht refused to go along with it and was sacked. In 1943 Schacht was imprisoned on orders from Hitler.

After WW2, I was friends with Dr. Schachts Godson for many years. He had lived with Schacht during the 1920s and 1930s.

Cynicom  posted on  2007-07-15   9:37:43 ET  Reply   Trace   Private Reply  


#21. To: Cynicom (#20)

After Hitler came to power, the world banks were trying to force their way in but Schacht kept them out.

In 1938 when Hitler was intent on using his armaments for aggressive war, Schacht refused to go along with it and was sacked. In 1943 Schacht was imprisoned on orders from Hitler.

He must have been a good man, Schacht.

Ron Paul for President

robin  posted on  2007-07-15   9:40:51 ET  Reply   Trace   Private Reply  


#22. To: Cynicom (#20)

After WW2, I was friends with Dr. Schachts Godson for many years. He had lived with Schacht during the 1920s and 1930s.

thank you for your almost-first-hand view of history.

I wish school-children all over the country would learn these lessons. They would too if the people who rule us would consent for it to be allowed in our schools.

Galatians 3:29 And if ye [be] Christ's, then are ye Abraham's seed, and heirs according to the promise.

Red Jones  posted on  2007-07-15   9:52:20 ET  Reply   Trace   Private Reply  


#23. To: robin (#21)

He must have been a good man, Schacht.

Indeed he was.

Dr. Schacht was the only one found not guilty at Nuremburg.

His Godson emigrated to the US after WW2.

Cynicom  posted on  2007-07-15   9:57:53 ET  Reply   Trace   Private Reply  


#24. To: robin (#21)

Some history of the Weimar hyperinflation.

In November 1923, a currency reform was undertaken. A new bank, the Rentenbank, was created to issue a new currency--the Rentenmark. This money was exchangeable for bonds supposedly backed up by land and industrial plant A total of 2.4 billion Rentenmarks was created, and each Rentenmark was valued at one trillion old paper marks. From that moment on the depreciation stopped--the Rentenmarks held their value; even the old paper marks held stable. Inflation ceased.

What was the secret of the "miracle of the Rentenmark"? After all, the new currency was not redeemable in anything. Its backing by real property was a fiction, since there was no way by which property could be foreclosed or distributed. Further, there we have the government distributing a vast new supply of money--2.4 billion trillion in terms of the old mark. Ought that not have led to a new wild inflation?

To understand this, we must recall that the real value of the money circulating in late 1923 was small--equal to a mere 168 million pre-war gold marks. The continued depreciation at this point was due to utter lack of confidence--to the belief that the printing presses would run indefinitely. But actually there was a great shortage of and need for money. New money could be introduced without price inflation if only people had confidence in it. How was confidence developed?

First, the government announced that the new currency would be "wertbestaendig"--stable in value. In their hunger for usable money people accepted this, at least until it should be proven false. Then the property backing seemed to give the currency value. True, the Assignats of the French Revolution, backed by fixed property, had depreciated, but still the backing helped.

Second, and certainly most important, the government limited strictly the amount of Rentenmarks which could be issued and it halted the issue and discounting of notes and the creation of paper marks. Finally, after April 1924, the Reichsbank stopped the expansion of credit to businesses which had been stimulating inflation. Businessmen were required to repay loans in gold marks, equal to the original value of the loan. Thereafter, incentive was gone to borrow except for legitimate needs.

Thus, the Rentenmark replaced the Papiermark. Due to the economic crises in Germany after the Great War there was no gold available to back the currency. Therefore the Rentenbank, which issued the Rentenmark, mortgaged land and industrial goods worth 3.2 billion Rentenmark to back the new currency. The Rentenmark was introduced at a rate 1 United States dollar = 4.2 RM.

The Rentenmark was only an intermediate currency and was not legal tender. It was, however, accepted by the population and effectively stopped the inflation. The Reichsmark became the new legal tender on 30 August 1924, equal in value to the Rentenmark.

The monetary policy spear-headed by Hjalmar Schacht - the Central Banker - together with the fiscal policy of German Chancellor Gustav Stresemann and Finance Minister Hans Luther brought the inflation in Germany to an end.

The Rentenbank continued to exist after 1924 and the notes and coins continued to circulate. The last Rentenmark notes were valid until 1948.

The U.S. Constitution is no impediment to our form of government.--PJ O'Rourke

DeaconBenjamin  posted on  2007-07-15   9:57:56 ET  Reply   Trace   Private Reply  


#25. To: DeaconBenjamin. everyone (#10)

The only way to purge public officials of corruption is to remove their power to regulate most aspects of human life. There is no prospect of avoiding corrupt public officials under our current governmental structure.

The U.S. Constitution is no impediment to our form of government.--PJ O'Rourke

Join the Ron Paul Revolution

Lod  posted on  2007-07-15   9:59:29 ET  Reply   Trace   Private Reply  


#26. To: DeaconBenjamin (#24)

The monetary policy spear-headed by Hjalmar Schacht - the Central Banker - together with the fiscal policy of German Chancellor Gustav Stresemann and Finance Minister Hans Luther brought the inflation in Germany to an end.

His full name...

Dr. Hjalmar Horace Greeley Schacht

Cynicom  posted on  2007-07-15   10:04:46 ET  Reply   Trace   Private Reply  


#27. To: DeaconBenjamin, aristeides, Red Jones, noone222, Cynicom (#24)

Most informative post and easy to follow. Thank you!

Ron Paul for President

robin  posted on  2007-07-15   10:07:30 ET  Reply   Trace   Private Reply  


#28. To: Red Jones (#22)

I wish school-children all over the country would learn these lessons.

Dr. Schachts Godson was a mentor to me.

He passed history to me that he had experienced first hand, without rancor, without an agenda, just hours spent recalling his life during the time after WW1.

He was probably the best educated person I ever had the privilege of knowing, plus an innate intelligence to match.

Cynicom  posted on  2007-07-15   10:13:43 ET  Reply   Trace   Private Reply  


#29. To: Cynicom (#23)

Papen was acquitted at Nuremberg. So was Hans Fritzsche.

Perhaps there were others who have slipped my mind.

To reason, indeed, he was not in the habit of attending. His mode of arguing, if it is to be so called, was one not uncommon among dull and stubborn persons, who are accustomed to be surrounded by their inferiors. He asserted a proposition; and, as often as wiser people ventured respectfully to show that it was erroneous, he asserted it again, in exactly the same words, and conceived that, by doing so, he at once disposed of all objections. - Macaulay, "History of England," Vol. 1, Chapter 6, on James II.

aristeides  posted on  2007-07-15   10:48:45 ET  Reply   Trace   Private Reply  


#30. To: aristeides (#29)

Papen was acquitted at Nuremberg. So was Hans Fritzsche.

True...However neither were major players as was Schacht.

No one ever understood why Papen and Fritzsche were ever charged.

"Hjalmar Schacht - Why Hjalmar Schacht was included in the list of defendants is unclear. In fact, the only charges brought against him were: contributing to Hitler's, and the Nazi Party's rise to power and promoting preparations for war. His dislike of the Versailles Treaty, his belief that the German military should once again be strong and his support of the Anschluss were well known, but these are hardly "war crimes." He was never in a position to exercise significant influence in any of the planning and preparation for war. Likewise, Schacht had never concealed his antisemitism and his agreement that Jews should be excluded from governmental and civil service positions"

Hjalmar Schacht was acquitted.

Cynicom  posted on  2007-07-15   10:57:44 ET  Reply   Trace   Private Reply  


#31. To: Cynicom (#30)

Papen had been the object of anti-Nazi propaganda works like Devil in a Top Hat during the war. Fritzsche was a stand-in for the dead Goebbels.

As for Schacht, I suspect the Soviets insisted that he be tried. Their theory was that Nazism was hypercapitalism.

To reason, indeed, he was not in the habit of attending. His mode of arguing, if it is to be so called, was one not uncommon among dull and stubborn persons, who are accustomed to be surrounded by their inferiors. He asserted a proposition; and, as often as wiser people ventured respectfully to show that it was erroneous, he asserted it again, in exactly the same words, and conceived that, by doing so, he at once disposed of all objections. - Macaulay, "History of England," Vol. 1, Chapter 6, on James II.

aristeides  posted on  2007-07-15   11:07:12 ET  Reply   Trace   Private Reply  


#32. To: aristeides (#31)

As for Schacht, I suspect the Soviets insisted that he be tried.

After the war, much of what was written concerning Dr. Schacht was his "anti-semitism", when in reality his first confrontation with Hitler was because Schacht had several Jews in his Ministry.

Hitler demanded they be thrown out and Schacht refused, telling Hitler to his face that he was in charge of the Finance Ministry and as long as they did their jobs they would stay. Hitler never forgave him for that.

Cynicom  posted on  2007-07-15   11:18:53 ET  Reply   Trace   Private Reply  


#33. To: Pinguinite, IndieTx, Red Jones, HOUNDAWG, Fred Mertz, Minerva, christine, Zipporah, farmfriend, Eoghan, wudidiz, wbales, Former Lurker, Jethro Tull, Yertle Turtle, robin, Diana (#4)

I'm curious, JC, what kind of monetary system you actually favor since you hold a gold backed currency in such contempt.

I just told you. Fiat based on fiscal, not monetary parameters, with a "storehouse of value" being savings of the excess productivity, released during the slow business cycle to be re-cycled into infrastructure and productive employment in rejuvenating the infrastructure. This and this only. Dedicated funds by Constitutional LAW.

Think of a farmer working his ass off in the summer and Fall and making one helluva lot of money and socking a portion of it away to grow 10% more crops the next year and pay his help over the slow winter months ( starving time) to fertilize and sow green manure ( rye grass) and fix the equipment for the next year so they can get off to a running start.

Imagine a factory with its own internal chits good for anything you want...all that is personal.

When times are booming and output is maximized so the employees are paid and the company profits to the maximun, the excess profit ( this can be an agreed upon tax base that is spent only to the X% level, i.e. the fiscal constraint, to support the factory's current obligations with the balance "saved" e.g. stock buybacks...) is saved then purposefully spent during a cyclical downturn to renew the factory's infrastructure, build new facilities, repair machinery, update systems and machinery, plan for the fiscal upturn etc employ the workers within the factory for meaningful CAPITAL REJUVENATION, i.e. infrastructure great for consumerism and the good of the work force) ...the excess profit is released during a slow time fo0r infrastructure rejuvenation and capital replacement and work force re-training/meaningful work.

For a company this would be internal, for a nation it would be release of excess funds for highway/bridge construction boom, Building and office upgrade/replacement, National/state Park expansion/updating, arts and humanities support, release of study funds, mineral/resource exploration and development, power grid updating, energy construction ( nuclear to hydrogen) ...

i.e. about every five years instead of a painful slowdown, there would be a cycle of renewal as the storehouse of value because this would put the nation, and its component parts, in position for the next boom and rather than a grinding start up, the new cycle could be maximized and thus more "value" saved to plow into more urgrading the next slow cycle.

This makes far more sense than basing a nation's weal on how much metal is extracted sometime somewhere then manipulated by the various international bankers, like gold and diamonds.

This is a fiscal rather than a monetary storehouse and release of value system of capitalism that makes productivity the driving force of economics, as it really is and should be, without the manipulations of bankers. Deficit spending is held strictly within limits set by productivity...i.e. YOU may buy a $300,000 home on credit IF and ONLY IF you make at least $75,000 and do not already owe much money.

JCHarris  posted on  2007-07-15   11:30:56 ET  Reply   Trace   Private Reply  


#34. To: Cynicom (#32)

Hitler demanded they be thrown out and Schacht refused, telling Hitler to his face that he was in charge of the Finance Ministry and as long as they did their jobs they would stay. Hitler never forgave him for that.

and I would say that you likely got that direct from your old friend who lived in Sschacht's house. That was likely not printed in any newspaper or book.

I'm not sympathetic to the NAZIs, but we should remember that the Germans had a lot of good people among them, and that what happened to germany was a horrible thing.

Galatians 3:29 And if ye [be] Christ's, then are ye Abraham's seed, and heirs according to the promise.

Red Jones  posted on  2007-07-15   11:39:06 ET  Reply   Trace   Private Reply  


#35. To: cynicom (#33)

Cynicom ping

sorry missed you

JCHarris  posted on  2007-07-15   11:40:52 ET  Reply   Trace   Private Reply  


#36. To: JCHarris (#35)

manipulated by the various international bankers

Therein lies the crux of the problem.

Bankers and speculators are the ruination of society.

For instance, the increased cost of producing one barrel of oil does not reflect the huge increase in the cost of gasoline.

I read your epistle without a ping. Thanks.

Cynicom  posted on  2007-07-15   11:48:55 ET  Reply   Trace   Private Reply  


#37. To: DeaconBenjamin (#24)

Great explanation. Please see my post 83 which actually folds into this fiscal system over a strictly monetarist manipulation, which includes gold held by bankers as a standard , and easily, correction, USUALLY manipulated by the international bankers.

JCHarris  posted on  2007-07-15   11:49:35 ET  Reply   Trace   Private Reply  


#38. To: All (#37)

typo

33

JCHarris  posted on  2007-07-15   11:50:14 ET  Reply   Trace   Private Reply  


#39. To: Cynicom (#36)

I do not have time to write a hundred page treatise on it, but think the system through and tell me what you think. This was first proposed by an economist, capitalist and America-loving man by the last name of Lennox during the 1920s. Notice the similarities to Ayn Rand's thinking although she had not published when he did publish this book ( I have a copy somewhere but the exact title escapes me...'A system of Infrastructure Renewal and Capital Replenishment as a Storehouse of Value to Replace the Gold Standard and Lessen the Deleterious Effects of the Business Cycle' ....close but not exact ) His son George Lennox married Cyrus Hall McCormick's great granddaughter and was himself an accomplished economist.

JCHarris  posted on  2007-07-15   11:56:35 ET  Reply   Trace   Private Reply  


#40. To: Red Jones, Cynicom (#34)

Hitler demanded they be thrown out and Schacht refused, telling Hitler to his face that he was in charge of the Finance Ministry and as long as they did their jobs they would stay. Hitler never forgave him for that.

and I would say that you likely got that direct from your old friend who lived in Schacht's house. That was likely not printed in any newspaper or book.

Most interesting.

Ron Paul for President

robin  posted on  2007-07-15   12:04:42 ET  Reply   Trace   Private Reply  


#41. To: Robin, Jethro Tull, Christine, Honway, Aristeides, Diana, All (#0)

Hmmmm! So that's where the "Fed" got the idea.


SKYDRIFTER  posted on  2007-07-15   12:16:50 ET  Reply   Trace   Private Reply  


#42. To: robin, Red Jones (#40)

Most interesting.

robin..

If I might digress, short story you and Red might find interesting and thought provoking...

During the waning months of the war the Gestapo was picking men up off the streets to put in uniform and sent to the Russian front. My friend was on his way to work , dragged off the street given a uniform, rifle and boots. There were about 150 of them waiting at the train station for cattle cars to take them East.

As they stood there waiting, a high ranking Gestapo officer came down the line, stopped in front of my friend, said my friends name as a question. He then told him he was free to go, turn in the uniform and leave.

My friend saw no one he knew there at the time, and after, no one came forward to say they had gotten him released. What intrigued him was the fact the Gestapo agent knew which man to pick out of the 150. He never knew who saved his life that day.

Cynicom  posted on  2007-07-15   12:27:33 ET  Reply   Trace   Private Reply  


#43. To: JCHarris (#33)

I mean this sincerely -- you're explanation is rather nebulous, and from what I can make of it, seems to offer nothing that a gold standard couldn't do. Savings is certainly possible in a gold backed economic system, and drawn upon during slow periods as needed.

Pinguinite.com

Pinguinite  posted on  2007-07-15   12:54:38 ET  Reply   Trace   Private Reply  


#44. To: Pinguinite (#43)

seems to offer nothing that a gold standard couldn't do.

This from Richard Cook two months ago.

The last paragraph explains it all.

"It was the gold standard that led to the bankers wrecking the U.S. economy in 1932 by shipping Treasury gold as a bail-out to England, at the same time the U.S. was trying to recover from the crash of 1929. The 1932 gold and currency contraction was the real cause of the Great Depression. President Franklin Delano Roosevelt removed this danger by eliminating the domestic gold standard in 1933."

But even when paper currency was supposedly convertible to gold, or even gold and silver, the metallic standard always was a fiction. There never was and never could be enough for banks to hand over the requisite quantity to the “bearer on demand” if more than a fraction of the currency in circulation was presented for redemption at the same time."

Cynicom  posted on  2007-07-15   13:08:43 ET  Reply   Trace   Private Reply  


#45. To: Red Jones (#7)

not backed by gold, money is just made out of thin air & spent

Gold doesn't have any more innate value than any other commodity (including labor).

Rupert_Pupkin  posted on  2007-07-15   13:36:08 ET  Reply   Trace   Private Reply  


#46. To: Pinguinite (#43)

seems to offer nothing that a gold standard couldn't do

Not true. The fallacy of the gold standard is the one that bankrupted the world for thousands of years.

The supply of gold is finite. You must have a set price or the value is identical to the printing presses running all night...i.e. a pure monetarist inflation of the currency.

Currency based on productivity is far different, elastic and accommodating in both directions. The RICH do not get RICHER from the blood of the serfs and the manipulations of the bankers as is and always has been the case with the discredited 'gold standard'.

I do appreciate and respect your skepticism. I argued with George for two years over it, mostly as a devils advocate, but it is strikingly similar to the system which is the subject of this thread and is eminently sound.

Gold does NOT allow for expansion to the people based on productivity and personal wealth accumulation while simultaneously allowing a 'storehouse of value' determined exclusively by productivity and released to once again PRIME that productivity instead of serving as the "King's Horde" while the masses and middle classes and more successful all starve.

JCHarris  posted on  2007-07-15   13:41:21 ET  Reply   Trace   Private Reply  


#47. To: JCHarris (#33)

An attractive theory. But, IMHO, there would be much too abundant opportunity for corruption under your system to guarantee that the self-interest of the "money managers" would correlate with the public interest. Thus, we would have a situation where the types of people who currently identify the government's official inflation rates in the US would be determining the appropriate levels of money production or withdrawal. Additionally, Congress and its special interest puppet masters would maintain incessant pressure for more money to be produced to be applied to their pet causes.

The U.S. Constitution is no impediment to our form of government.--PJ O'Rourke

DeaconBenjamin  posted on  2007-07-15   13:42:47 ET  Reply   Trace   Private Reply  


#48. To: DeaconBenjamin (#47)

Would this work in a Jew infiltrated and usurped society? Of course not...no more likely than you now pay an honest price for a diamond or a bank loan or a gold coin....which you do NOT.

I inserted Constitutional LAW as the mandate and a spelled out formula.

Nothing could be more corrupt than our European Rothschild banking and voodoo economics right now !

JCHarris  posted on  2007-07-15   13:47:13 ET  Reply   Trace   Private Reply  


#49. To: JCHarris (#39)

Your system sounds similar to a that of a book that I have purchased and read -- Money Creators by Gertrude Coogan, published by Sound Money Press in 1935. She does not mention Lennox, but she does reference Charles Lindbergh Sr. several times

The U.S. Constitution is no impediment to our form of government.--PJ O'Rourke

DeaconBenjamin  posted on  2007-07-15   13:48:55 ET  Reply   Trace   Private Reply  


#50. To: DeaconBenjamin (#47)

self-interest of the "money managers"

BTW.... that is why I do not buy gold to any extent today....the Jew banks in Europe manipulate that like it is hotcakes to a starving crowd for their own enrichment and the scalding of honest people who try to LOGICALLY embrace a gold portfolio, which you can not do over any important period of time .

Hell, cotton candy can be speculative in a starving crowd but its lasting value is ephemeral...thus it is with gold too.

JCHarris  posted on  2007-07-15   13:49:58 ET  Reply   Trace   Private Reply  


#51. To: Rupert_Pupkin (#45)

Gold doesn't have any more innate value than any other commodity (including labor).

From the beginning of time, mankind would disagree - gold and silver have always been an earthly store of value.

Join the Ron Paul Revolution

Lod  posted on  2007-07-15   13:50:59 ET  Reply   Trace   Private Reply  


#52. To: JCHarris (#48)

I guess in your reference to Constitutional Law, you indicate that your monetary system is under the same handicap as our Constitutional system of government, as identified by John Adams:

We have no government armed with power capable of contending with human passions unbridled by morality and religion. Avarice, ambition, revenge, or gallantry, would break the strongest cords of our Constitution as a whale goes through a net. Our Constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other.

Works of John Adams, Second President of the United States (Boston: Little, Brown, 1854), Vol. IX, p. 564. Letter from John Adams to Dr. Prince, April 19, 1790.

The U.S. Constitution is no impediment to our form of government.--PJ O'Rourke

DeaconBenjamin  posted on  2007-07-15   13:57:08 ET  Reply   Trace   Private Reply  


#53. To: DeaconBenjamin (#49)

Lennox, George , Sr. I believe; did spend some years in Greenwich Village during the 20s and 30s when it was not a kook neighborhood but rather a gathering place for people actually trying to figure out a system for the United States not tied to the European strangle hold on productivity and a fairer upward access to personal wealth creation that was so evident in the entanglements and millstone on the European nations imposed by the bankers and their gold hoarding/capital withholding leading to productivity stagnation....as the elite bankers want it..."I got mine a thousand years ago now SCREW YOU."

Is it any wonder that Germany was the industrial/science/invention/productivity capital of the world?? Scientific Literature was until recently preferred in German. Wissenschaftlicher Deutsch was a necessity before WWII.

They ( Lennox et al.) were also the last thing to socialists and reminded me in reading of Ayn Rand.

Lots of math, even then !! LOL but it WAS Isaac Newton who invented the calculus (slope-finding and limits) to simplify the convoluted algebraic calculations (-;

JCHarris  posted on  2007-07-15   13:58:54 ET  Reply   Trace   Private Reply  


#54. To: DeaconBenjamin (#52)

Always.

Identify the overall problem and throw the bums out.

JCHarris  posted on  2007-07-15   13:59:53 ET  Reply   Trace   Private Reply  


#55. To: Cynicom (#44)

"It was the gold standard that led to the bankers wrecking the U.S. economy in 1932 by shipping Treasury gold as a bail-out to England, at the same time the U.S. was trying to recover from the crash of 1929. The 1932 gold and currency contraction was the real cause of the Great Depression. President Franklin Delano Roosevelt removed this danger by eliminating the domestic gold standard in 1933."

The Fed Reserve bank was already in place at that time, so how can this be blamed on the gold standard?

But even when paper currency was supposedly convertible to gold, or even gold and silver, the metallic standard always was a fiction. There never was and never could be enough for banks to hand over the requisite quantity to the “bearer on demand” if more than a fraction of the currency in circulation was presented for redemption at the same time."

If so, then that itself should be/have been a capital crime.

Pinguinite.com

Pinguinite  posted on  2007-07-15   14:26:12 ET  Reply   Trace   Private Reply  


#56. To: Pinguinite (#55)

If so, then that itself should be/have been a capital crime.

Congressman Louis McFadden tried his best to strangle the Fed Res and paid for it with his life.

Someone in this discussion mentioned Congressman Lindbergh. He also tried to derail the Fed and its crooks and he was ruined politically. The hate that was put on his son the pilot was hate for the Father that the bankers never forgave.

Cynicom  posted on  2007-07-15   14:37:04 ET  Reply   Trace   Private Reply  


#57. To: Pinguinite (#55)

The Fed Reserve bank was already in place at that time, so how can this be blamed on the gold standard?

As JC explained gold or any physical commodity can be manipulated, exploited and speculated.

Two Presidents in our history have defied the bankers and issued money on their own. Both were assassinated.

Cynicom  posted on  2007-07-15   14:41:15 ET  Reply   Trace   Private Reply  


#58. To: JCHarris (#46)

Not true. The fallacy of the gold standard is the one that bankrupted the world for thousands of years.

The gold standard bankrupted the world for thousands of years??? Sorry, I'm not buying that -- no pun intended. The premise it requires is pretty absurd.

The supply of gold is finite. You must have a set price or the value is identical to the printing presses running all night...i.e. a pure monetarist inflation of the currency.

Yes, the supply is finite, but it cannot be manufactured, which is key. A printing press, on the other hand, can manufacture money, in which case you place your trust in the intergrity of the printer, and man has demonstrated time and time again that corruption will take root, given the chance.

With a gold standard, the free market decides how much an ounce of gold will buy. Government, as per the Constitution, merely gives Congress the authority to decide how much gold defines an "dollar", so that the free market can negotiate commerce more easily.

Gold does NOT allow for expansion to the people based on productivity and personal wealth accumulation while simultaneously allowing a 'storehouse of value' determined exclusively by productivity and released to once again PRIME that productivity instead of serving as the "King's Horde" while the masses and middle classes and more successful all starve.

The supply of gold as money will still fluxuate according to market demand. If gold becomes too common such that inflation begins to take hold, gold will natural seep from the market into it's many commercial and industrial uses, such that inflation is suppressed. If it becomes too rare such that an ounce of gold buys too much, market forces reopen mines and scrap gold is remonetized back into circulation. It's self regulating.

Why do you find it reasonable for people to trust a government money printing bureaucrat to not exploit his powers to his advantage? Gold has the advantage of not being creatable out of thin air.

Pinguinite.com

Pinguinite  posted on  2007-07-15   14:47:47 ET  Reply   Trace   Private Reply  


#59. To: JCHarris (#50)

BTW.... that is why I do not buy gold to any extent today....the Jew banks in Europe manipulate that like it is hotcakes to a starving crowd for their own enrichment and the scalding of honest people who try to LOGICALLY embrace a gold portfolio, which you can not do over any important period of time .

Then how do you store your wealth? FRNs? Another commodity? Land? Stocks?

You have to store it somehow, and FRNs are a bad choice as we all know. Commodities are good, and gold is a commodity.

Pinguinite.com

Pinguinite  posted on  2007-07-15   14:51:09 ET  Reply   Trace   Private Reply  


#60. To: lodwick, Rupert_Pupkin (#51)

Gold doesn't have any more innate value than any other commodity (including labor).

From the beginning of time, mankind would disagree - gold and silver have always been an earthly store of value.

I don't disagree. Other commodities (tin, lead, wood) have innate value too. But gold and silver (gold especially) have many unique properties and attributes that make it a good choice for money. (I.e. doesn't burn or rust).

Pinguinite.com

Pinguinite  posted on  2007-07-15   14:55:28 ET  Reply   Trace   Private Reply  


#61. To: Cynicom (#57)

As JC explained gold or any physical commodity can be manipulated, exploited and speculated.

He didn't explain that, or at least explain how it happens. He just said it does.

The obstical with such manipulation in a gold standard economy is that as someone hoards gold, the reduced gold in circulation drives prices up, which makes it harder (more expensive) for the hoarder to continue to sap gold from the economy. The more successful he is, the higher the price he has to pay to continue. The reduced supply of gold simultaneously creates pressure to mine more gold and reintroduce gold from other places (jewelry and elsewhere).

He'd have no more success in removing gold from circulation that the DEA has in removing drugs from circulation, and for the exact same reason.

And if the hoarder ever wants to participate in the economy, he has to spend the gold he's trying to hoard. And if he never does, then economically speaking, it's a non-issue as it just means he contributed goods & services to the economy while never accepting any in return.

Two Presidents in our history have defied the bankers and issued money on their own. Both were assassinated.

Yes, and this flies in the face of any proposition that bankers LOVE gold standards. Why would they kill people for wanting to institute gold standards if it plays into their favor???

Pinguinite.com

Pinguinite  posted on  2007-07-15   15:08:55 ET  Reply   Trace   Private Reply  


#62. To: Pinguinite (#61)

Yes, and this flies in the face of any proposition that bankers LOVE gold standards.

Bankers do love the gold standard or any other physical commodity they can control, or manipulate.

Cynicom  posted on  2007-07-15   16:01:22 ET  Reply   Trace   Private Reply  


#63. To: Pinguinite (#61)

As JC explained gold or any physical commodity can be manipulated, exploited and speculated.

He didn't explain that, or at least explain how it happens. He just said it does.

Elementary !!

If I have a monopoly on gold...and the bankers have since before the Crusades...I can declare any value I want to for the gold and then it is the same as fiat.

This is done all the time.

There have been many times the "dollar price " of gold should have been $1000 but was a fifth of that and vice versa...this is strictly a regional reserve bank decision...and YES you can be made to sell your "gold" in many ways.

In addition, the expansion and contractioon of gold, and the fact it always stays in the ownership of the monarchy/banker prevents it allowing flexibility in increased productivity for the reasons stated previously.

Gold is NEITHER a good medium of exchange...it is not exchanged...NOR is it a good storehouse ov value since its price can be manipulated by the essentially sole owners at will.

JCHarris  posted on  2007-07-15   17:08:04 ET  Reply   Trace   Private Reply  


#64. To: All (#63)

In addition, the expansion and contractioon of gold,

Gold cannot be expanded to meet production needs in good times without it simply being fiat.

Likewise it cannot contract during bad times to prevent inflation, which is currency without the counterbalancing productivity.

This gold is a POOR medium and de facto a poor storehouse of value.

Public works are a better storehouse of value and a medium of FISCAL policy to move the monetary needs in the right direction depending on productivity and inventory expansion or contraction.

JCHarris  posted on  2007-07-15   17:14:15 ET  Reply   Trace   Private Reply  


#65. To: Pinguinite. gold naysayers here (#60)

But gold and silver (gold especially) have many unique properties and attributes that make it a good choice for money. (I.e. doesn't burn or rust).

So true.

If gold's so bad, give me all that you've got, and I'll give you some banana's.

Deal?

Join the Ron Paul Revolution

Lod  posted on  2007-07-15   17:58:54 ET  Reply   Trace   Private Reply  


#66. To: Cynicom (#62)

Bankers do love the gold standard or any other physical commodity they can control, or manipulate.

When the FRS was created, we were on a gold standard, but now we are not. How can one conclude, then, that the powers behind the fed would prefer a gold standard? It's just not logical.

Pinguinite.com

Pinguinite  posted on  2007-07-15   20:04:46 ET  Reply   Trace   Private Reply  


#67. To: JCHarris (#63)

If I have a monopoly on gold...and the bankers have since before the Crusades...I can declare any value I want to for the gold and then it is the same as fiat.

You can try to get a monopoly on many things, but you can't have a monopoly on money, as to obtain more of it you would have to buy it with something. With what would you buy money?

There have been many times the "dollar price " of gold should have been $1000 but was a fifth of that and vice versa...this is strictly a regional reserve bank decision...and YES you can be made to sell your "gold" in many ways.

Obviously you're speaking of times when there was no gold standard. How can you criticize the gold standard over the number of FRNs ascribed (by bankers) to a certain amount of gold?

Pinguinite.com

Pinguinite  posted on  2007-07-15   20:12:20 ET  Reply   Trace   Private Reply  


#68. To: JCHarris (#64)

Gold cannot be expanded to meet production needs in good times without it simply being fiat.

Sure it can. More gold enters circulation as demand increases. Doesn't happen overnight, but it happens. Market forces require it?

Likewise it cannot contract during bad times to prevent inflation, which is currency without the counterbalancing productivity.

Again, reduced demand would mean cheaper gold for industrial and commercial applications, which would mean no new gold is mined and existing gold currency is removed from circulation. Again, it doesn't happen overnight, but it happens.

I don't suggest a gold monetary system would perfectly guarantee that prices never change for goods and services. They would go up and would go down, but such things would be relatively temporary. As for your alternative, it's major hazard is that it gives a certain bureaucrat somewhere all the power of contemporary bankers, ready to be abused.

Pinguinite.com

Pinguinite  posted on  2007-07-15   20:18:32 ET  Reply   Trace   Private Reply  


#69. To: Pinguinite (#67)

You can try to get a monopoly on many things, but you can't have a monopoly on money, as to obtain more of it you would have to buy it with something. With what would you buy money?

That's one point exactly...

"Hey guys I know the population has grown and we need more ships and olive groves and and and and and ...but our mines won't allow it because all we can haul up is a few ounces a day..."

JCHarris  posted on  2007-07-15   20:42:46 ET  Reply   Trace   Private Reply  


#70. To: Pinguinite (#68)

More gold enters circulation

duuuhhhhh only if it is mined.....

that is a silly way to expand your economy...or to contract it for that matter...

and the princes own the gold...always have always will....hoarding, no good to ANYONE...

I was buying gold in the 70s .... have traded it successfully....

I stay out of gold most of the time as it is silly and a drag on my portfolio....

JCHarris  posted on  2007-07-15   20:46:25 ET  Reply   Trace   Private Reply  


#71. To: JCHarris (#70)

duuuhhhhh only if it is mined.....

duhhh.. no. Gold has many practical uses, jewelry being but one. If it's cheap, gold is absorbed into those uses, out of circulation and the money supply shrinks. If gold is rare, such uses are more restricted and gold can even be converted from those things, such as jewelry, back into money and the money supply expands. The beauty of it is the market both decides how much gold is needed, and provides the incentive for ANYONE to add to or subtract from the economy's money supply. The right is not restricted to a few privileged elite as it is now and would be under your proposal.

and the princes own the gold...always have always will....hoarding, no good to ANYONE...

Well, I own gold and I ain't no prince. So far as anyone has told me, at least.

I stay out of gold most of the time as it is silly and a drag on my portfolio....

If you're trading to make money, sure, stay out of gold. Gold is for people who just want to keep their money safe.

Pinguinite.com

Pinguinite  posted on  2007-07-15   23:25:13 ET  Reply   Trace   Private Reply  


#72. To: Pinguinite (#71)

If you're trading to make money, sure, stay out of gold. Gold is for people who just want to keep their money safe.

That logic is exactly backwards. Trading is the only way to keep anything safe with gold.

My gold (and silver) activity was in going long in the early 70s and stopping it in the mid-80s. I was young, smart, schooled in economics and technical fields and languages ...and not too staid to put my money where my mind was. I made $36,000 in six weeks from a $5000 investment in gold and never lost a cent in those early years.

I bought things you see now for 50 cents a share.

This had little to do with gold and a lot to do with the fact I watched macro-economics like a hawk.

I bought and leveraged gold in many forms including importing hundreds of finished chains from Florence Italy ! Great for the importer, pretty for the buyer, but absolutely NO investment value whatsoever. Calculate the 1000 fine gold for yourself. The manufacturing cost is less than pot metal because the gold is easier to work on the machinery.

By the way, back then I also bought Nuclear Medicine, the original company OTC! which is the magnetic resonance imaging you know now after myriad buyouts, licensing, splits and morphs, at 50 cents a share.....it made gold look anemic!

I never touched gold or silver again until the mid-90s when I started accumulating again at 50 cents a share, $1.00 a share, $3.00 a share.....just for the hell of it...and BTW I was COMPLETELY out of the tech and all but 10% of the core stock market in February 2000 and told all my friends to do the same !

Did not touch that again until gingerly right after 9-11..rocky, bought the hell out of airlines when the markets re-opened the next few months, bet on a fed bailout and sold as soon as it came through, then in earnest from 2001 to the present mostly in small/mid growth ( 90%) now large value (90%).

Made the same FED theft bet on Providian Financial, the third largest credit card company giving YOUR money to ghetto blacks and illegal aliens, bought it at 50 cents, a few thousand shares , bet on the Jew Bankers taking care of their own with YOUR money, was right and rode that until the day it was bought by Washington Mutual....neat 6000% increase !

I rode Wheaton from its first days at what $1 - $3.00 , leveraged and split and sold and departed at $30 -$32. Again, I now own no gold, a little silver as stocks and coinage, a minuscule %, except for a few coins, most old, worth maybe $20,000.

Wheaton was sweet but never even touched my several buys of BE Aerospace...

BEAV three separate buy-sell cycles....looked at Amin Khoury, the owner, who bought the hell out of ir when it bottomed on fears for the airlines. When he bought, I bought ! :arge buys were at 2.25 2.70 to 3, sold at over 12 each time, plowed all multiples back in ( 2400% increase before the last buy) back in and half sold again at $33. Still hold half and have gains in the thousands of % !! I stopped looking at 3400% ! I will sell the other half when it touches 40.

If you are not going to trade, stay out of gold as it is a long loser and the stuff of late night TV commercials.

Gold as a long term holding is like putting your money under your mattress gloating at your friends and refusing to admit its usefulness is eroding at 5% a year or more, over the long term.

The concept of productivity is far more rewarding....but you have to learn and work.

There IS no free lunch.

1776 $1 in stocks is $1,ooo,ooo now...

that same $1 in gold is around $30 now.

You choose.

JCHarris  posted on  2007-07-16   4:06:51 ET  Reply   Trace   Private Reply  


#73. To: Red Jones (#9)

I have stamps from Germany that I collected when I was young with Hitler's face on them, some of them marked up to 10 million Deutsche Marks.

"They must find it difficult... Those who have taken authority as the truth, rather than truth as the authority." ~ Gerald Massey

wudidiz  posted on  2007-07-16   4:27:17 ET  Reply   Trace   Private Reply  


#74. To: robin (#19)

I'll have to read that book, seems interesting. What I've read indicates that Speer did have a great deal to do with the peaking of German war materiel in late 1944 (for the Germans, it would have been better if it had peaked in early 1942). In December 1941, the Wehrmacht was screaming for anything that had tracks on it, and there really wasn't anything available. I think sometime in mid-1942, Hitler was told that the Soviets were producing between 1000 and 1600 T-34s per month, which he thought was fabrication. The Germans at the same time were producing 25 Tiger tanks per month. (I'm quoting everything from memory, so the timeframes and numbers might be a little off). To characterize the Soviet achievement, they moved something like 1000 industrial works to the Urals to try to save them from the advancing Germans, put it back together, and then built stuff the entire time. Both in Stalingrad and Leningrad there were times when the factories would finish assembling the vehicle, the crew would load it and get into it, and it would leave the factory and join the battle, sometimes without being painted.

The Germans had a problem with over-engineering a lot of things, and diverging on what should have been immediately obvious as fools errands. They built a massive 48in howitzer that they maintained throughout the war, and it fired a grand total of under 50 rounds. At Sweden. Two of my favorites were the bunkenschlebber (sp?) and the Maus (I think that was its name). The bunkenschlebber was a mobile bunker built on railroad tracks. This was built in 1944, and it had the possibility of being mobile, on the surface, a decent idea. It only moved west, at a time when the Wehrmacht on the Western Front was retreating back east. The Maus was a 100 ton tank that had multiple engines in it that only very late in the war did they even get to move. Think of the Ferdinand only much heavier. The Maus had something like three or four cannons on it, and I know one was 152mm, I think there was a long barreled 88mm on it too. American soldiers who captured German artillery noted that the cannons were of first rate manufacture, but whereas a US made breech block might have 7 parts, the German one would have 35 to do the same job. They also used vehicles of dozens of different manufacturers to do the same job. If you have 20 two and a half ton trucks, and there were 10 different manufacturers of them, you've got a logistics nightmare, one that the German system was ill equipped to deal with. The US logistics system might be able to handle something like that, but the German one was incapable of doing so.

Rivers of blood were spilled out over land that, in normal times, not even the poorest Arab would have worried his head over." Field Marshal Erwin Rommel

historian1944  posted on  2007-07-16   9:16:39 ET  Reply   Trace   Private Reply  


#75. To: historian1944, robin (#74)

Tooze clearly shows that even absolute dictatorships just can't afford to neglect the balance of payments. He argues, convincingly, that Speer's "armaments miracle" wasn't much of a miracle after all,

I have not read Tooze but from your excerpt, he is totally wrong.

Anyone that discredits the work done by Speer destroys his own credibility at the outset. Tooze first of all overlooks the fact that when you are working with or for a dictator that is willing to shoot you at any moment, you are working under a handicap.

Secondly, anyone researching what transpired at the collapse of Germany would disagree with Tooze. For weeks following the end of the war, British and American intelligence people were debriefing Speer as to how he accomplished what he did under such circumstances.

In fact Speer is credited to be the first "technocrat" of this age.

Cynicom  posted on  2007-07-16   9:31:30 ET  Reply   Trace   Private Reply  


#76. To: Cynicom (#75)

Good points.

Everything I've read indicates the same thing, and even just looking at the vehicle production figures in a vaccum (no context, just numbers) it's a really tough sell; as I've indicated, numbers increase until late 1944, and it appears that the only reason that production starts to decrease is because we and the Soviets started capturing areas where things were being produced. It also shows that the strategic bombing campaign wasn't all that effective (unless one wanted to kill many thousands of civilians). If the Germans would have gone on a war footing in 1939, things would have been much more difficult for all sides, since there would have been a great deal more materiel available for them to use.

Rivers of blood were spilled out over land that, in normal times, not even the poorest Arab would have worried his head over." Field Marshal Erwin Rommel

historian1944  posted on  2007-07-16   9:39:45 ET  Reply   Trace   Private Reply  


#77. To: historian1944, robin (#76)

Everything I've read indicates the same thing,

The Germans are meticulous record keepers. American intelligence people were astounded at what Speer had accomplished.

My friend was a design engineer for Messerschmidtt and I doubt very much if he would agree with Tooze.

Cynicom  posted on  2007-07-16   9:50:18 ET  Reply   Trace   Private Reply  


#78. To: JCHarris (#72)

If you're trading to make money, sure, stay out of gold. Gold is for people who just want to keep their money safe.

That logic is exactly backwards. Trading is the only way to keep anything safe with gold.

No, I had it right. If you're looking to make your investment grow, you don't simply put your money in any one thing, including gold, and forget about it. You trade, which means you convert it from one form to another form as market conditions change. That's exactly what you did as you described, and it's called, of course, trading.

But the topic we were discussing was not how to trade and make your money grow. It was what type of monetary system works best. You seem to be equating monetary systems with investment opportunities, and I'd never do that. It is plainly NOT the purpose of a monetary system to make everyone a rich, successful investor. Rather, it's simply to lubricate the economy to make it much easier for people to trade their goods and services since bartaring is a very inefficient system. That's it. It doesn't go beyond that at all.

Gold as a long term holding is like putting your money under your mattress gloating at your friends and refusing to admit its usefulness is eroding at 5% a year or more, over the long term.

You also said it appreciated 30x over since 1776, so how can it do that while losing 5% a year?

that same $1 in gold is around $30 now.

FRN's are depreciating at 5% a year. If you are going to put your money somewhere and forget about it, then gold is a far better place to put it than FRNs.

You have obviously had lots of success at trading, so congrats. But that has nothing to do with whether gold should be money or not. You seem to be confusing gold as an investment with gold as a monetary base. Apples and oranges.

Pinguinite.com

Pinguinite  posted on  2007-07-16   15:47:36 ET  Reply   Trace   Private Reply  


#79. To: Pinguinite (#78)

You also said it appreciated 30x over since 1776, so how can it do that while losing 5% a year?

that same $1 in gold is around $30 now.

Real simple!!

The cost indexes are FAR FAR higher than 30x since 1776.

JCHarris  posted on  2007-07-17   9:13:18 ET  Reply   Trace   Private Reply  


#80. To: JCHarris (#79)

The cost indexes are FAR FAR higher than 30x since 1776.

Riiiiiiight. So gold has lost value due to inflation such that it is now worth 30x more than in 1776. Real simple.

This conversation has been enlightening. Thank you for reaffirming my faith in the gold standard.

Pinguinite.com

Pinguinite  posted on  2007-07-17   14:28:20 ET  Reply   Trace   Private Reply  


#81. To: Pinguinite (#80)

Riiiiiiight. So gold has lost value due to inflation such that it is now worth 30x more than in 1776. Real simple.

This conversation has been enlightening. Thank you for reaffirming my faith in the gold standard.

http://Pinguinite.com

Pinguinite

Are you REALLY that dense??

In 1776 you have two gold coins.

One you "give away" and buy a gold coin (`$20) of stocks.

The other you keep in your glass jar.

Today your glass jar has your gold coin, worth `$600-$700

Today your stock is VALUED at $20,000,000 ; with which you can BUY 31,000 gold coins.

The difference is the stock WORKED, innovated, developed intellectual property,technology, consumer goods, capital property and ENHANCED the expansion and contraction of the human endeavor in a meaningful and organic manner.

Your gold coin just sat there as dumb as a stump, unable to accommodate the needs of you or your humankind.... it was the hidden talent.

Your gold standard is thus to be whipped and banished as the lazy and scared servant who hid the talent....and was justly punished.

The gold standard is anathema in an even semi-modern world and did not formerly work that well even in an incredibly advanced world as the Romans oversaw or the European continuation of that world.

JCHarris  posted on  2007-07-17   17:57:20 ET  Reply   Trace   Private Reply  


#82. To: JCHarris (#81)

Today your glass jar has your gold coin, worth `$600-$700

Today your stock is VALUED at $20,000,000 ; with which you can BUY 31,000 gold coins.

Pray tell, how did a conversation about what makes a sound money system turn into an investment seminar? It is you who are too dense to understand the difference between the two. Seems you advocate a system where money consists of certificates of a huge mutual fund of an entire country's capital investment. Sounds fun.

Again, it is NOT the purpose of a monetary system to convert everyone into a speculative investor, even if the end result makes everyone a millionaire. Indeed, if everyone were a millionaire, which it seems everyone would be if your 1776 statistical claim is correct, then being a millionaire would mean you are a middle class citizen. No more, no less.

Again, the SOLE purpose of a monetary system is to allow people to efficiently negotiate commerce. That's it. It doesn't go beyond that. At all. Period. End of story. That someone of your supposed background doesn't get it is astounding.

You say gold has done little to nothing since 1776. I say that's exactly what it's supposed to do. Little to nothing. Why? Because it means it's value is stable, which is EXACTLY what you want (or what most people want) in a currency. Stability. If in a gold based economy you want to invest in stock, you can do that, believe it or not. All you do is give your gold coins to someone else in exchange for share ownership in a company, and you're on your way to being as rich as you are. That being the case, what's the problem? We can have the economic system I want with the investment opportunities you want and we're both happy.

The gold standard is anathema in an even semi-modern world and did not formerly work that well even in an incredibly advanced world as the Romans oversaw or the European continuation of that world.

Yet another paradox you lay out: The Roman empire was an incredibly advanced civilization that used gold as money, and yet.... it was in spite of such a failing economic system, an ..... incredibly advanced civilization.

Do you really believe a civilization can become so incredibly advanced with a disfunctional economic system?

Honestly, you really need to sit back and take another look at the big picture. You have posted a number of things on this thread that are plainly illogical.

Pinguinite.com

Pinguinite  posted on  2007-07-18   1:14:21 ET  Reply   Trace   Private Reply  


#83. To: Pinguinite (#82)

Seems you advocate a system where money consists of certificates of a huge mutual fund of an entire country's capital investment.

The point lost on you is that a monetary system MUST have the flexibility to accommodate economic expansion and contraction. That is a prime asspect of a monetary system.

Gold lacks even any semblance of that function.

Thanks.

JCHarris  posted on  2007-07-18   7:54:58 ET  Reply   Trace   Private Reply  


#84. To: JCHarris (#83)

a monetary system MUST have the flexibility to accommodate economic expansion and contraction. That is a prime asspect of a monetary system.

Noun 1. tenacitytenacity - persistent determination doggedness, perseverance, persistency, pertinacity, tenaciousness, persistence determination, purpose - the quality of being determined to do or achieve something; "his determination showed in his every movement"; "he is a man of purpose"

Cynicom  posted on  2007-07-18   8:09:22 ET  Reply   Trace   Private Reply  


#85. To: robin (#0)

What matters more than the medium of exchange is with whom you are willing to exchange.

Burn up that quarter mile! Burn up that quarter mile! (Listen to 'em whine, whine whine. Listen to 'em whine, whine, whine.)

Tauzero  posted on  2007-07-19   14:05:47 ET  Reply   Trace   Private Reply  


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