4 ms·

Usually people don't understand the dangers of private banks owning a fiat paper currency they can print at will. Until I pull out a silver quarter or silver d

by X86BSD 10y ago

Usually people don't understand the dangers of private banks owning a fiat paper currency they can print at will. Until I pull out a silver quarter or silver dollar and prove to them how much the private federal reserve has devalued their money. Then it's like, "Oh. Wow. You're right."

Laforet 10y ago
A Morgan dollar is worth $15 for its material and possibly more for its collectible value, what is the problem here? Every dollar invested in 1900 would still have yielded a better return than $15, i.e. burying silver in the ground. The real issue with a currency based on precious metal is that the reverse grows at such a rate much slower (<1% annually for gold IIRC) than economic growth. In a deflationary market, rational actors would simply remove money from circulation because it will just increase in value on its own, whilst the economy collapses.
colanderman 10y ago
…except people don't keep fiat currency underneath mattresses. They invest it, and better their economy for doing so. So your old coin isn't competing against some ratty old dollar bill, it's competing against the real value of my index fund shares. Which, by the way, are winning: http://ritholtz.com/wp-content/uploads/2013/04/fda.jpg http://ritholtz.com/wp-content/uploads/2013/04/fda.jpg
- icantdrive55 10y ago
  Keep an eye on your Index fund (real value) when the free money stops. Sorry guys, I think we are in for some rough times ahead. There's got to be a price to pay? The people, I see getting loans, are practically gambling with the money. But what do I know? I'm a nobody. I did read that jobs report the other day. What jumped out was the amount of people who just stopped looking for work.
- chillwaves 10y ago
  Just wait until he pulls that silver dollar out of his pocket. Then you will see.
tehwebguy 10y ago
"It's just like bitcoin in practice, except you have to use fire and steel to break it into smaller increments!"
- R_haterade 10y ago
  Interestingly, a good pair of tinsnips is enough. It was a serious problem until Isaac Newton (of all people) came along. Apologies that I can't find a better source right now: http://www.lsned.com/newton-invented-ridges-coins/ http://www.lsned.com/newton-invented-ridges-coins/
Spooky23 10y ago
People don't understand the risk of commodity investments until I show them a coin collectors red book from 1986, when that same Morgan dollar was worth $3-4. Gold and silver is high because asians with money in places like China and India don't trust their governments. Period. Reliance on gold and the resulting starvation of capital caused a lot of economic and social devastation 100-130 years ago.

by X86BSD 10y ago

Laforet 10y ago

A Morgan dollar is worth $15 for its material and possibly more for its collectible value, what is the problem here? Every dollar invested in 1900 would still have yielded a better return than $15, i.e. burying silver in the ground. The real issue with a currency based on precious metal is that the reverse grows at such a rate much slower (<1% annually for gold IIRC) than economic growth. In a deflationary market, rational actors would simply remove money from circulation because it will just increase in value on its own, whilst the economy collapses.

colanderman 10y ago

…except people don't keep fiat currency underneath mattresses. They invest it, and better their economy for doing so. So your old coin isn't competing against some ratty old dollar bill, it's competing against the real value of my index fund shares. Which, by the way, are winning: http://ritholtz.com/wp-content/uploads/2013/04/fda.jpg http://ritholtz.com/wp-content/uploads/2013/04/fda.jpg

icantdrive55 10y ago
Keep an eye on your Index fund (real value) when the free money stops. Sorry guys, I think we are in for some rough times ahead. There's got to be a price to pay? The people, I see getting loans, are practically gambling with the money. But what do I know? I'm a nobody. I did read that jobs report the other day. What jumped out was the amount of people who just stopped looking for work.
chillwaves 10y ago
Just wait until he pulls that silver dollar out of his pocket. Then you will see.

tehwebguy 10y ago

"It's just like bitcoin in practice, except you have to use fire and steel to break it into smaller increments!"

R_haterade 10y ago
Interestingly, a good pair of tinsnips is enough. It was a serious problem until Isaac Newton (of all people) came along. Apologies that I can't find a better source right now: http://www.lsned.com/newton-invented-ridges-coins/ http://www.lsned.com/newton-invented-ridges-coins/

Spooky23 10y ago

People don't understand the risk of commodity investments until I show them a coin collectors red book from 1986, when that same Morgan dollar was worth $3-4. Gold and silver is high because asians with money in places like China and India don't trust their governments. Period. Reliance on gold and the resulting starvation of capital caused a lot of economic and social devastation 100-130 years ago.