Stop Calling Government Money Fake

[savonarola]

I was watching this video (http://www.cnbc.com/id/15840232?video=597341557&play=1) and realized something. I've noticed a common misunderstanding on fiat money that I believe is leading to the Fed's case against the Liberty Dollar. Fiat means "by decree," not fake, as some people think. It's simply money (scrip) by decree, and is legal tender. While it is not true money, it is real. It is real because they say so, and that's all.

Listen to the moron from Forbes Mag. He's basically parroting the fed's case. Let's steal their thunder. If we are more accurate about how we engage the people, we have less of an opportunity to commit inaccuracies and allow the feds/media to lie to us.

[Ron LOL]

I agree. When you call "fiat" money "fake," you sound like a crazy gold bug.

[ItsTime]

Its not fake... It is as real as the Feds allow it to be.

[constituent]

it's worse than fake.


it is maintained by your obedience alone.

Refuse to Obey!

Arbeit will not set you Frei.

[hocaltar]

Yeah, it's not fake. It's just a Federal Reserve Note, which is worth well, whatever one thinks it is...

[noxagol]

I will call it real money once it is real money.

[Man from La Mancha]

Money is anything people agree too. So long as your buying gas and food with paper or electronic transfer, YOU have spoken to what money is.

.

[ronpaulfan]

Don't call it fake, that doesn't have the right impact.....Call it monopoly money :D

[runderwo]

Political money, funny money, etc.

A fun question to ask is, what's the difference between a counterfeiter and the federal reserve? The counterfeiter produces lower quality counterfeits, that's all. Both of them create money out of thin air, with no backing value, and for the benefit of special interests. And the effect on money already in circulation is exactly the same.

[specsaregood]

I agree. When you call "fiat" money "fake," you sound like a crazy gold bug.

With gold at $820 right now, who is crazy? :) Crazy like a fat, happy fox.

[MrCoffee]

If I write an IOU and have it signed, witnessed, and notorized, that's got to be "worth" something, right?

I think the concept is similar.

[Brent H]

How about calling it "counterfeit" as that's the word that Dr. Paul uses?

[DrNoZone]

It's fake because it's backed by NOTHING of value. It's not even worth, in real value, the paper it's printed on. That is why people refer to it as fake, and they are accurate in that sense. I agree though that counterfeit would be a much more accurate term.

Oh, and stop telling others what to do. Thanks.

[torchbearer]

If I write an IOU and have it signed, witnessed, and notorized, that's got to be "worth" something, right?

I think the concept is similar.

Its not worth anything to me. But your gold rings have some value to me. You can keep your "valuable" paper... I'll take your gold. In fact, I will give you a piece of paper with $10000000 written on it. Fair deal huh?

[torchbearer]

In the matrix, paper money is real and gold and silver is fake. If you live in this world you are in trouble. Take the red pill and we'll pull you out.

[davidkachel]

If I write an IOU and have it signed, witnessed, and notorized, that's got to be "worth" something, right?

I think the concept is similar.

If the IOU says "IOU more of these IOUs" does it really have any value?

[savonarola]

This isn't to say we shouldn't have a currency backed by gold or silver. The point is about how we conduct ourselves. If the Liberty Dollar is SEEN as legal tender, they have a case. If we understand the difference, and watch our words, they lose their case.

I'm with you all--end fiat currency. However, we have to be wise about what we say.

[skinzterpswizfan]

Its not worth anything to me. But your gold rings have some value to me. You can keep your "valuable" paper... I'll take your gold. In fact, I will give you a piece of paper with $10000000 written on it. Fair deal huh?

Why is does gold have value? Because people gave it value. Why does paper money have value? Because people gave it value.

[constituent]

1) The counterfeiter produces lower quality counterfeits, that's all. 2) Both of them create money out of thin air, with no backing value, and for the benefit of special interests.

1) i don't know about that, seen the new bills?

2) well, with the same backing. our obedience
to the mandate of paper.

[ronpaulitician]

Actually, I think that calling it "by decree" money will open more doors for intellectually honest discussion than "fake" money ever would.

[Mastiff]

I agree we should moderate the rhetoric. The circulating currency will always be worth more than what backs it. Even if you have gold backing, this fact will cause gold to be worth more than it would be for use in industry or as jewelry. This thing about it all being in your head is true of hard currency too, the main point is that hard currency can't be manipulated by the government for political reasons.

I think we should also point out that Paul wouldn't actually force a gold standard, he'd simply change the law to allow competing currencies. This could shake out in other ways besides gold backed money. Share money is an approach I like. The problem with gold is that in a rapidly growing economy it causes people to waste resources digging up more and more gold.

[constituent]

Why is does gold have value? Because people gave it value. Why does paper money have value? Because people gave it value.

nanotech, no?

plus it doesn't fall apart very easily.

[DrNoZone]

I think we should also point out that Paul wouldn't actually force a gold standard, he'd simply change the law to allow competing currencies. This could shake out in other ways besides gold backed money. Share money is an approach I like. The problem with gold is that in a rapidly growing economy it causes people to waste resources digging up more and more gold.

Following the Constitution wouldn't be forcing anything, considering that it MANDATES gold and silver as the only Constitutional form of currency that Congress can authorize.

[savonarola]

mastiff, I agree. Thanks for the points. I was wondering, if the elites push the Amero, and the Liberty Dollar becomes Ron Paul's addition to the currency market, one could feasibly choose from 3 currencies. That would cause a huge economic boom, until one (most likely the fed notes) crashes. The holders of those notes would then cause the demand of the other notes to rise--causing an even further boom.

[margomaps]

Why is does gold have value? Because people gave it value. Why does paper money have value? Because people gave it value.

Not exactly. Gold has value for a number of reasons. One of those is that it's "relatively scarce" and/or difficult to remove from the ground. The perceived scarcity (real or imagined) is part of what makes it more desirable than, say, sand.

People have also been attracted to gold for millenia because it's...well, attractive. It's fairly malleable, hence easy to craft into jewelery and other accoutrements.

Gold also has a number of other physical properties that make it valuable in various scientific and manufacturing processes. It's ductile, reflective of visible and infrared light, conducts electricity better than almost any metal (silver is a notable exception), and is largely resistant to corrosion.

For these reasons -- and some that I likely overlooked -- gold has intrinsic value. Its intrinsic value is bolstered by its subjective value (aesthetics), and its rarity magnifies the total value.

Paper....not so much. If people begin to lose confidence in a fiat currency, and the supply of currency keeps increasing artificially via the Fed, the actual value of the currency will continue decrease when measured against things that don't tend to change much in value: a loaf of bread, a gallon of milk, etc.

[torchbearer]

Why is does gold have value? Because people gave it value. Why does paper money have value? Because people gave it value.

gold and silver can be molded into implements of use... that is why they had original value. easy to mold metal.
You statement is an obvious... but i say to you trade me all your precious metals for all the paper I own. Its nice printer paper, unused. You can make lots of money with the paper.

[skinzterpswizfan]

Not exactly. Gold has value for a number of reasons. One of those is that it's "relatively scarce" and/or difficult to remove from the ground. The perceived scarcity (real or imagined) is part of what makes it more desirable than, say, sand.

People have also been attracted to gold for millenia because it's...well, attractive. It's fairly malleable, hence easy to craft into jewelery and other accoutrements.

Gold also has a number of other physical properties that make it valuable in various scientific and manufacturing processes. It's ductile, reflective of visible and infrared light, conducts electricity better than almost any metal (silver is a notable exception), and is largely resistant to corrosion.

For these reasons -- and some that I likely overlooked -- gold has intrinsic value. Its intrinsic value is bolstered by its subjective value (aesthetics), and its rarity magnifies the total value.

Paper....not so much. If people begin to lose confidence in a fiat currency, and the supply of currency keeps increasing artificially via the Fed, the actual value of the currency will continue decrease when measured against things that don't tend to change much in value: a loaf of bread, a gallon of milk, etc.

No arguments from me. Just playing devil's advocate.

For the record I'd much prefer gold in my hand's than paper money.

[someguy200]

It's not fake, it's as real to the degree that you can convince somebody else it's real. It's only when other people stop believing hard enough that your left holding a bunch of worthless pieces of paper.

[torchbearer]

It's fake to me, and by your definition...if i see it as fake. then its fake to me. Don't give me your funny money.

So, why suppose that you have the right to tell someone what they can call government money. If its fake to my eyes, it is only honesty to call it fake. To say otherwise would be lying and compromising my self to appease your idea of a perfect world where you govern everyone's actions to your liking.

[AlexMerced]

Facebook money, money backed by shares of facebook!!! let's make the Us economy, facebook

lol, sorry, just thinking about the purchase of 5% by microsoft and what facebook essentially is worth now.

[Mordechai Vanunu]

Federal Reserve money is NOT government money. "Government" money is made by the U.S. treasury, under the control of Congress.

[lucius]

With gold at $820 right now, who is crazy? :) Crazy like a fat, happy fox.

QFT!!! :D

Maybe 'Astute like a Goldbug' would of been better?

[fsk]

I prefer to call them "Federal Reserve Points"

http://fskrealityguide.blogspot.com/2007/08/federal-reserve-work-permission-points.html

Historically, a dollar referred to a specific quantity of gold or silver.

[ron_paul_silver_dollars]

While the US Dollar isn't fake... the US Dollar is no longer backed by anything of tangible value... meaning, if everyone looses confidence in the US Dollar, the currency could move into a virtual free-fall as it is no longer anchored by anything of tangible value.

Prior to approx. 1970, the Dollar was actually backed by a guaranteed amount of physical Silver & Gold... so, no matter what happened, the Dollar was always has a correpsonding convertible value to Gold or Silver.

http://quotes.ino.com/chart/history.gif?s=NYBOT_DX&t=l&w=15&a=50&v=dmax

[noztnac]

I think "loses" may very well be the most misspelled word on the Internet.

[Mastiff]

While the US Dollar isn't fake... the US Dollar is no longer backed by anything of tangible value... meaning, if everyone looses confidence in the US Dollar, the currency could move into a virtual free-fall as it is no longer anchored by anything of tangible value.

Prior to approx. 1970, the Dollar was actually backed by a guaranteed amount of physical Silver & Gold... so, no matter what happened, the Dollar was always has a correpsonding convertible value to Gold or Silver.


Correct me if I'm wrong, but I think if we had gold backed currency and people lost faith in it and went to an alternate currency, the gold backing would be minimal protection because the dollar would revert to the corresponding value of gold for commercial use (industry/jewelry). The owner of the currency would still lose big time because the premium on the value due to it dominance as circulating currency would be lost.

[torchbearer]

Correct me if I'm wrong, but I think if we had gold backed currency and people lost faith in it and went to an alternate currency, the gold backing would be minimal protection because the dollar would revert to the corresponding value of gold for commercial use (industry/jewelry). The owner of the currency would still lose big time because the premium on the value due to it dominance as circulating currency would be lost.

that assumes there is a premium, gold could simply be circulated at intrinsic value.

[Mastiff]

that assumes there is a premium, gold could simply be circulated at intrinsic value.

There will always be a premium. A hunk of gold that can be jewelry or a circuit board or a medium of exchange is worth more than gold that can only be jewelry or a circuit board. I don't think there's any disagreement that using gold as currency will cause more resources to be spent mining gold. If you believe that, then the premium follows (actually the premium is the reason).

[jon_perez]

With gold at $820 right now, who is crazy? :) Crazy like a fat, happy fox.Ironic though... by saying gold "is worth $820" you are still giving primacy to the value of the dollar! chuckle...

[unklejman]

Facebook money, money backed by shares of facebook!!! let's make the Us economy, facebook

lol, sorry, just thinking about the purchase of 5% by microsoft and what facebook essentially is worth now.

Well you could exchange your FRNs (I call them ferns) with Lindens on Second Life. (http://www.secondlife.com)