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How many countries have currencies backed by gold? Is the USD fiat backed by gold? Soon per person debt in the USA is going to sky rocket. Is it really such a

How many countries have currencies backed by gold? Is the USD fiat backed by gold? Soon per person debt in the USA is going to sky rocket. Is it really such a bad thing having a domestic digital currency with no intrinsic value? We can control quality of life and local exchange. If it’s not pegged with the usd, it might bifurcate economy as local/domestic and international. We might avoid a revolution or civil war or mass youth revolt. Perhaps it can be in lieu of UBI. I can’t see how what’s happening now can be a good thing for Americans and USA a decade down the line. On principle, I don’t support UBI. Having said that, I don’t see how it can be avoided. From a macro economic and micro economic POV. Perhaps having some form of it ..with some kind of flexibility..will be a better compromise.

alexmingoia 6y ago
Currency is already digital, so it’s not clear what you mean by digital currency. When people say the Fed “prints dollars” it’s not literally printed, it’s a number in a computer representing the reserve account of member banks. When you use a bank card, it’s just changing numbers in bank databases. No country has a gold-backed currency. The USD is not backed by gold, or anything. It was historically backed by gold until the US defaulted in 1971 (The Nixon Shock), because they didn’t have enough gold to service foreign debt obligations. The US had increasingly issued more dollars than it had gold backing it (fractional reserve banking). When they defaulted, the US abandoned the gold standard altogether and let the dollar float freely. The US can create as many dollars as it wants.
- jelliclesfarm 6y ago
  Ok. Let me put it down as points. I am figuring this out as I type: 1. There is a fixed exchange rate for every currency. 2. Trade is conducted with this fixed exchange rate. 3. There is also a floating rate for the currency which means that it is strong or weak depending on GDP, economy etc. 4. OTOH, there are local economies. For cities inside the USA. Why should trade of soy and hogs with China affect the rent paid by a retiree in small town America? 5. Many pension funds invest in companies listed on Wall Street, but when dispersed, it is used for exchange of goods for money in high streets and local economies. 6. Can not a local economy be separate from traded currency? This would create a barter like economy. 7. Padding an economy from future shocks is easier if local economy is divorced from trade economy. Thoughts?
  - alexmingoia 6y ago
    I’m not sure why you seem to think international trade is bad? You can’t prevent international trade from affecting domestic trade by using separate currencies. Goods traded internationally are produced domestically. You can definitely outlaw international trade, but this would reduce wealth and productive capacity by reducing access to capital goods. Just look at any country that has been isolated from international trade through embargo (Iran, Cuba, Myanmar, North Korea, etc.). What reasoning leads you to believe importing soy from China drives up rent prices for retirees?
    - jelliclesfarm 6y ago
      I don’t think international trade is bad. That’s not what I meant. I will try to articulate better in another comment soon.

alexmingoia 6y ago

Currency is already digital, so it’s not clear what you mean by digital currency. When people say the Fed “prints dollars” it’s not literally printed, it’s a number in a computer representing the reserve account of member banks. When you use a bank card, it’s just changing numbers in bank databases. No country has a gold-backed currency. The USD is not backed by gold, or anything. It was historically backed by gold until the US defaulted in 1971 (The Nixon Shock), because they didn’t have enough gold to service foreign debt obligations. The US had increasingly issued more dollars than it had gold backing it (fractional reserve banking). When they defaulted, the US abandoned the gold standard altogether and let the dollar float freely. The US can create as many dollars as it wants.

jelliclesfarm 6y ago
Ok. Let me put it down as points. I am figuring this out as I type: 1. There is a fixed exchange rate for every currency. 2. Trade is conducted with this fixed exchange rate. 3. There is also a floating rate for the currency which means that it is strong or weak depending on GDP, economy etc. 4. OTOH, there are local economies. For cities inside the USA. Why should trade of soy and hogs with China affect the rent paid by a retiree in small town America? 5. Many pension funds invest in companies listed on Wall Street, but when dispersed, it is used for exchange of goods for money in high streets and local economies. 6. Can not a local economy be separate from traded currency? This would create a barter like economy. 7. Padding an economy from future shocks is easier if local economy is divorced from trade economy. Thoughts?
- alexmingoia 6y ago
  I’m not sure why you seem to think international trade is bad? You can’t prevent international trade from affecting domestic trade by using separate currencies. Goods traded internationally are produced domestically. You can definitely outlaw international trade, but this would reduce wealth and productive capacity by reducing access to capital goods. Just look at any country that has been isolated from international trade through embargo (Iran, Cuba, Myanmar, North Korea, etc.). What reasoning leads you to believe importing soy from China drives up rent prices for retirees?
  - jelliclesfarm 6y ago
    I don’t think international trade is bad. That’s not what I meant. I will try to articulate better in another comment soon.