If there's a single moment in time that we can point to as the leading cause of our financial problems, it's this video of Nixon. Once we allowed the bankers and politicians to collude and create money -- shocker! -- they constantly found excuses to print the wealth out from under us and transfer it to their buddies.
The problem was he had to stop the gold bleed. The problem was created earlier by Johnson by the increased cost of domestic programs and especially the Vietnam War. War always creates inflation. In other places and black markets worldwide, gold traded at higher prices; the arbitrage was far too lucrative to turn down. People and foreign governments bought dollars and then demanded gold. It was a great trade for them.
Gold bugs always blame the federal reserves for issues, but Congress makes all the funding decisions. They are the ones responsible for most of the financial problems.
"Congress makes all the funding decisions. They are the ones responsible for most of the financial problems."
---------
I agree with that, but removing the last link between sound money and the dollar was obviously a disastrous decision for everybody but the people close to the money printer. And it's another example of government screwing up a problem that government created in the first place. Without their ability to print, they'd be restrained by economic reality.
Well, yes and no. The reason we came out of the great depression was not until the gold standard was removed. Until 71, we then had a hybrid gold standard—the money could be created without producing gold. That was the stupid decision to solve an immediate problem during the Depression.
The Depression turned into a massive deflation event. The world desperately needed more cash. You could not issue more money unless more gold was produced, a serious Catch-22. The US went off the gold standard after confiscating the public gold at a low price; after the public gold accumulation (stealing), the price was raised. But, as mentioned, Congress created more money in the hybrid period in WW Two, which was bad enough, then Johnson's New Deal then another war this time in Vietnam.
The problem is always the creation of debt without paying it back.
There is no way to be on a gold standard; there is not enough gold. One of the best ideas, I think, is to limit government spending by a percentage of GDP. I am not encouraged that will ever happen.
"The reason we came out of the great depression was not until the gold standard was removed."
-------
I think the reason we came out of the great depression was that we weren't blowing up our GDP any longer after the war, and our productivity could go to improving the lives of Americans.
Of course, we wouldn't have been able to go to war on the full gold standard. I'll let you decide if that's a positive or not.
All nations that dropped the gold standard immediately had improved economies.
This is a copy and paste because I am running out of time. But, it is an easy search of the gold standard and the depression.
"The United States and other countries on the gold standard couldn’t increase their money supplies to stimulate the economy. Great Britain became the first to drop off the gold standard in 1931. Other countries soon followed.
But the United States didn’t abandon gold for another two years, deepening the pain of the Great Depression."
"All nations that dropped the gold standard immediately had improved economies."
I'd say the same of nations that print trillions of dollars and helicopter it away -- initially. The party is off the hook when you just put the hookers and blow on the credit card, but sooner or later you've got to pay the bill. Printing dollars doesn't print wealth!
Ultimately I don't think it matters because that cat is out of the bag (gold standard), but there's no excuse for our monetary policy to be determined by bankers and politicians. We should instead tie money creation to birth rate or predictable rate of increase, or else we're all going to end up with wheelbarrows of worthless dollars.
"There is no way to be on a gold standard; there is not enough gold."
This is just nonsense.
The money supply is irrelevant; "issuing more money", i.e. printing it, does not create value. The idea that you need to print more money in order to spend money, or that deflation means that you can't spend money, is just modern monetary theory quackery.
I remember writing a paper on this for AP American History in high school. While discussing it with my dad and grandfather (a lawyer and a businessman) I asked them their thoughts. They both said Nixon destroyed the dollar (our currency) and our economy. They then went on and said I can quote them in my paper as an original source.
Here is a truism that you can count on politicians and governments doing 100 percent of the time. For example, this phrase by Nixon: "I have directed Secretary Connally to suspend temporarily the convertibility of the dollar into gold or other reserve assets."
The truism is whenever they use the word — "temporarily," count on it, in reality, being permanent. I have not found a temporary policy ever reversed and restored to its previous state. Have you?
Phil Davis: You go to the trash heap. Use nouns in your comments or no one knows what the hell you, Phil Davis, are talking about. We, the readers. can't read your mind.
Jordan, an apt and timely reminder. I have a few thoughts to add:
1. In addition to the Breton Woods declaration by Nixon, which would become permanent, the WEF was founded on January 24 of, wait for it, 1971! Coincidence? Thus we arrive at a place where first the “central bank” of the USA (home of the global reserve currency) was privatised (in 1913) with the establishment of the Federal Reserve, which a gross oxymoronic name; second the WEF was established for big business (especially banks) to “lobby” governments and impose their world view in all governments and all people and then the last hurdle to total financial (and therefore actual) domination was removed, the USD gold standard.
2. The problems we currently face is not as a result of removal of the gold standard, therefore reestablishing it will fix nothing and is anyway unworkable because Western governments have been selling off all their gold reserves (well done Gordon and Tony!!! Totally moronic (or nefarious? Check out what. Lairs new foundation is up to...). The problems are widespread and directed by the elites. Consider the following: An assault on Western values and morality, and even how we view ourselves and our history (glorious history and the bad stuff too), and a campaign to desensitise to violence and disgust; An assault on freedom of choice over ones health decisions; an assault on privacy; an assault on freedom of expression and speech, even on what we are permitted to think, and a related assault on how we thing (nudge theory propaganda); an assault on bodily autonomy; an assaults on a parents rights to guide and decide what is best for their children, and even to have children; an assault on the well-being of our children; an assault on our mental well-being in the form of existential threat level Pandemic and Climate Alarm and an assault on our financial stability and independence. Why would a small elite group of power mongers want to make the entire population of the world scared for their lives; scared for their financial stability; incapable or unable to question anything; incapable of owning anything, much less property and their own home; and rabidly indoctrinated to attack anyone who does question “The Authority” (nod to His Dark Materials because this is the Magisterium!).
3, Finally, Bitcoin is not the answer but something like that could be. The chief reasons Bitcoin is not the answer is that it is controlled by the Banks. Currently it is not a currency, it is a speculative vehicle with no valuation basis at all. Just belief. We used to call this “VapourWare” during the first internet bubble. As such it is no better than any belief based currency and it can be manipulated. In any case the issues are not purely financial, they are social and governmental.
In conclusion, in order to avoid Orwell’s nightmare we must reject these constructed attacks on our Freedom and democracy, on Western values and morality and return to logic, data and common sense. We must remember what our parents and grandparents taught us and what they did to build the greatest advancement of human civilisation ever, the Free West. In short, we must remember who we are and what we stand for and what our forebears stood for and died for. For our children and grandchildren and all the children yet to come. We must remove the elites and remake our democracies.
There was no way to finance Vietnam and our other global empire operations without closing the gold window. It wasn’t Nixon on his own who decided this. It was the entire MIC that required it.
Nixon fecked up royally. Every economist worth a damn told him how stupid this was. This was part of the plan (Fed Reserve was the beginning) to destroy the US economically.
What is Bitcoin/blockchain than a glorified excel sheet, recording debits and credits. That's what it is. Sure, useful for selling and recording, but we want to move away from an electronic currency that can be controlled from afar.
I believe Bretton Woods involved not just dollar convertibility but also a fixed rate of exchange. The problem was not the backing of gold with the dollar, but a fixed rate of exchange between a gold-backed dollar and foreign currencies. That opened the door to loot the actually valuable gold with shenanigans. Rather than abandon the exchange rate, they abandoned the sound backing of the currency.
Would a gold backed dollar system have allowed for the gutting and offshoring of the entire US manufacturing base? I like to think that it would not as a gold backed currency would leak out gold in the event of a sustained imbalance of payments until the price of imports became unaffordable.
What Nixon did was to make the destruction of the American working and middle class possible by forcing them into competition with the mass of Chinese living in near serf conditions with no rights. It must not be a coincidence that he was responsible for the thaw in relations with China and the conversion of dollars to full fiat currency.
The Bush family did that. Mini mill steel technology and Wyoming coal and automation is what reduced manufacturing/union jobs from 1979-1994. The SUV saved American manufacturing…and then Bush/Cheney signed China into the WTO right after 9/11. As bad as 9/11 was China in the WTO led to much more American Carnage than 9/11.
This was the last step in a long process of destroying our currency. One might say Nixon at least stopped lying, as the position was that we had adequate gold reserves to survive a run on the dollar, and maintain convertibility. Continuing that lie which the world was no longer buying was increasingly impossible. At the risk of seeming tetchy, I think this is an example of seeing malice or incompetence when in fact I'd say events overran Nixon. AmiCompletelyWrong?
The problem is that private money was even worse as far as I can tell historically. Look at Bitcoin, say what you will (i have a small crypto exposure, have played carefully for a while, made some money), it cannot function as money. Value cannot change that rapidly and be a 'unit of account', 'store of value' and reliable 'means of exchange'.
I think conflating central banking with the backing of a currency is not helpful. Reserve banks operate to backstop private banks as a lender of last resort in a liquidity crunch that is temporary. We run banks fairly well actually in the states. The real problem is we have like 100x more banks/credit unions than we need. State based licensing is a disaster for consumers of financial services. That's why finserv extracts so much. We also need to truly support alternate pay mechanisms, and can do that without abandoning a currency.
I've always found the Taylor Rule and Taylor's monetary thinking quite persuasive. It made me realize that people are the problem, politics is the problem, not the question of what is sound monetary policy. That's obvious. What's really hard to figure out is how to justify obviously irresponsible and destructive policies, and man, our 'betters' in DC and elsewhere seem to be very busy at the Fed being 'Masters of the Universe'.
Only a government can really eff up an economy, a private person or company cannot. One of the thoughts I often have is exploring a govt issued currency with its value is determined solely in markets and money creation is totally private by banks and perhaps other lenders. I think we can find examples of fiat currencies working well for a while. The temptation of the politicians is just too much for them. So put in a market force that punishes them if they abuse the currency or the fisc. We actually have some of this happening today directly and indirectly but it is in no way to we use private money creation as our primary or sole mechanism for doing so.
CUI BONO⁉️ look(in)to the controlled trilateral backer/banksters and take down of that administration and WHY⁉️ (they couldn’t afford to roll two heads in a row)
thems aimed for decades/centuries to bring us to the coups of major resource countries in the control of them slave-trading colonial sames. bitcoin is only now the means useful for totalitarian control. thems got a long game now implemented and WE SOL. it’s already been done SO.
look around at the test subjects for every means to implement this GLOBAL shitshow
For what it's worth, the guy leading the polls to be the next president of Argentina (where they know a thing or two about monetary bombs), Javier Milei, agrees with you on Bitcoin being a reserve currency.
PS - In 1971, dollars were only convertible to gold by FOREIGN GOVERNMENTS, not regular people. Normal folks got shafted way back in FDR's time.
If there's a single moment in time that we can point to as the leading cause of our financial problems, it's this video of Nixon. Once we allowed the bankers and politicians to collude and create money -- shocker! -- they constantly found excuses to print the wealth out from under us and transfer it to their buddies.
Bingo
A criminal cabal - politicians and bankers....
The problem was he had to stop the gold bleed. The problem was created earlier by Johnson by the increased cost of domestic programs and especially the Vietnam War. War always creates inflation. In other places and black markets worldwide, gold traded at higher prices; the arbitrage was far too lucrative to turn down. People and foreign governments bought dollars and then demanded gold. It was a great trade for them.
Gold bugs always blame the federal reserves for issues, but Congress makes all the funding decisions. They are the ones responsible for most of the financial problems.
"Congress makes all the funding decisions. They are the ones responsible for most of the financial problems."
---------
I agree with that, but removing the last link between sound money and the dollar was obviously a disastrous decision for everybody but the people close to the money printer. And it's another example of government screwing up a problem that government created in the first place. Without their ability to print, they'd be restrained by economic reality.
Well, yes and no. The reason we came out of the great depression was not until the gold standard was removed. Until 71, we then had a hybrid gold standard—the money could be created without producing gold. That was the stupid decision to solve an immediate problem during the Depression.
The Depression turned into a massive deflation event. The world desperately needed more cash. You could not issue more money unless more gold was produced, a serious Catch-22. The US went off the gold standard after confiscating the public gold at a low price; after the public gold accumulation (stealing), the price was raised. But, as mentioned, Congress created more money in the hybrid period in WW Two, which was bad enough, then Johnson's New Deal then another war this time in Vietnam.
The problem is always the creation of debt without paying it back.
There is no way to be on a gold standard; there is not enough gold. One of the best ideas, I think, is to limit government spending by a percentage of GDP. I am not encouraged that will ever happen.
"The reason we came out of the great depression was not until the gold standard was removed."
-------
I think the reason we came out of the great depression was that we weren't blowing up our GDP any longer after the war, and our productivity could go to improving the lives of Americans.
Of course, we wouldn't have been able to go to war on the full gold standard. I'll let you decide if that's a positive or not.
All nations that dropped the gold standard immediately had improved economies.
This is a copy and paste because I am running out of time. But, it is an easy search of the gold standard and the depression.
"The United States and other countries on the gold standard couldn’t increase their money supplies to stimulate the economy. Great Britain became the first to drop off the gold standard in 1931. Other countries soon followed.
But the United States didn’t abandon gold for another two years, deepening the pain of the Great Depression."
"All nations that dropped the gold standard immediately had improved economies."
I'd say the same of nations that print trillions of dollars and helicopter it away -- initially. The party is off the hook when you just put the hookers and blow on the credit card, but sooner or later you've got to pay the bill. Printing dollars doesn't print wealth!
Ultimately I don't think it matters because that cat is out of the bag (gold standard), but there's no excuse for our monetary policy to be determined by bankers and politicians. We should instead tie money creation to birth rate or predictable rate of increase, or else we're all going to end up with wheelbarrows of worthless dollars.
Thanks for the discussion, have a good one!
"There is no way to be on a gold standard; there is not enough gold."
This is just nonsense.
The money supply is irrelevant; "issuing more money", i.e. printing it, does not create value. The idea that you need to print more money in order to spend money, or that deflation means that you can't spend money, is just modern monetary theory quackery.
The single moment in time was the creation of the Fed Reserve, long before Nixon
this level of money printing is criminal
I remember writing a paper on this for AP American History in high school. While discussing it with my dad and grandfather (a lawyer and a businessman) I asked them their thoughts. They both said Nixon destroyed the dollar (our currency) and our economy. They then went on and said I can quote them in my paper as an original source.
Here is a truism that you can count on politicians and governments doing 100 percent of the time. For example, this phrase by Nixon: "I have directed Secretary Connally to suspend temporarily the convertibility of the dollar into gold or other reserve assets."
The truism is whenever they use the word — "temporarily," count on it, in reality, being permanent. I have not found a temporary policy ever reversed and restored to its previous state. Have you?
Phil Davis: Yeah, and politicians are temporary too just like the rest of us.
haha, actually they are not; some stay for life
Phil Davis: Using pronouns just proves that you are lazy mentally and linguistically. Who are "they" and who are "some"?
Okay, you go the trash heap, Hoss.
Phil Davis: You go to the trash heap. Use nouns in your comments or no one knows what the hell you, Phil Davis, are talking about. We, the readers. can't read your mind.
Hey Timmy BOY—do you like that pronoun? You can take your fucking attitude and comments and stick up your hippy smelly ass.
Jordan, an apt and timely reminder. I have a few thoughts to add:
1. In addition to the Breton Woods declaration by Nixon, which would become permanent, the WEF was founded on January 24 of, wait for it, 1971! Coincidence? Thus we arrive at a place where first the “central bank” of the USA (home of the global reserve currency) was privatised (in 1913) with the establishment of the Federal Reserve, which a gross oxymoronic name; second the WEF was established for big business (especially banks) to “lobby” governments and impose their world view in all governments and all people and then the last hurdle to total financial (and therefore actual) domination was removed, the USD gold standard.
2. The problems we currently face is not as a result of removal of the gold standard, therefore reestablishing it will fix nothing and is anyway unworkable because Western governments have been selling off all their gold reserves (well done Gordon and Tony!!! Totally moronic (or nefarious? Check out what. Lairs new foundation is up to...). The problems are widespread and directed by the elites. Consider the following: An assault on Western values and morality, and even how we view ourselves and our history (glorious history and the bad stuff too), and a campaign to desensitise to violence and disgust; An assault on freedom of choice over ones health decisions; an assault on privacy; an assault on freedom of expression and speech, even on what we are permitted to think, and a related assault on how we thing (nudge theory propaganda); an assault on bodily autonomy; an assaults on a parents rights to guide and decide what is best for their children, and even to have children; an assault on the well-being of our children; an assault on our mental well-being in the form of existential threat level Pandemic and Climate Alarm and an assault on our financial stability and independence. Why would a small elite group of power mongers want to make the entire population of the world scared for their lives; scared for their financial stability; incapable or unable to question anything; incapable of owning anything, much less property and their own home; and rabidly indoctrinated to attack anyone who does question “The Authority” (nod to His Dark Materials because this is the Magisterium!).
3, Finally, Bitcoin is not the answer but something like that could be. The chief reasons Bitcoin is not the answer is that it is controlled by the Banks. Currently it is not a currency, it is a speculative vehicle with no valuation basis at all. Just belief. We used to call this “VapourWare” during the first internet bubble. As such it is no better than any belief based currency and it can be manipulated. In any case the issues are not purely financial, they are social and governmental.
In conclusion, in order to avoid Orwell’s nightmare we must reject these constructed attacks on our Freedom and democracy, on Western values and morality and return to logic, data and common sense. We must remember what our parents and grandparents taught us and what they did to build the greatest advancement of human civilisation ever, the Free West. In short, we must remember who we are and what we stand for and what our forebears stood for and died for. For our children and grandchildren and all the children yet to come. We must remove the elites and remake our democracies.
He really was a dick, wasn’t he ….
As I mentioned above. he had no choice. The US would have depleted all gold reserves.
Phil Davis: The US government could have cut its spending by 50% and kept the gold.
Yes, but the politicians weren't willing to pay that cost.
SimulationCommander: That is my point. Politicians don't care about us or the future. All the politicians and bureaucrats care about is themselves.
There was no way to finance Vietnam and our other global empire operations without closing the gold window. It wasn’t Nixon on his own who decided this. It was the entire MIC that required it.
yes, he was. His Secretary of Agriculture, Earl "Rusty" Butz (I swear, that's his real name), completely obliterated small farms.
Nixon fecked up royally. Every economist worth a damn told him how stupid this was. This was part of the plan (Fed Reserve was the beginning) to destroy the US economically.
So what you are saying is we need Bitcoin backed by gold!! Now you are speaking my language.
I was with you until the Bitcoin argument.
What is Bitcoin/blockchain than a glorified excel sheet, recording debits and credits. That's what it is. Sure, useful for selling and recording, but we want to move away from an electronic currency that can be controlled from afar.
Simpler isn't bad, it's better.
Paper votes, paper money.
I believe Bretton Woods involved not just dollar convertibility but also a fixed rate of exchange. The problem was not the backing of gold with the dollar, but a fixed rate of exchange between a gold-backed dollar and foreign currencies. That opened the door to loot the actually valuable gold with shenanigans. Rather than abandon the exchange rate, they abandoned the sound backing of the currency.
Would a gold backed dollar system have allowed for the gutting and offshoring of the entire US manufacturing base? I like to think that it would not as a gold backed currency would leak out gold in the event of a sustained imbalance of payments until the price of imports became unaffordable.
What Nixon did was to make the destruction of the American working and middle class possible by forcing them into competition with the mass of Chinese living in near serf conditions with no rights. It must not be a coincidence that he was responsible for the thaw in relations with China and the conversion of dollars to full fiat currency.
The Bush family did that. Mini mill steel technology and Wyoming coal and automation is what reduced manufacturing/union jobs from 1979-1994. The SUV saved American manufacturing…and then Bush/Cheney signed China into the WTO right after 9/11. As bad as 9/11 was China in the WTO led to much more American Carnage than 9/11.
This was the last step in a long process of destroying our currency. One might say Nixon at least stopped lying, as the position was that we had adequate gold reserves to survive a run on the dollar, and maintain convertibility. Continuing that lie which the world was no longer buying was increasingly impossible. At the risk of seeming tetchy, I think this is an example of seeing malice or incompetence when in fact I'd say events overran Nixon. AmiCompletelyWrong?
The problem is that private money was even worse as far as I can tell historically. Look at Bitcoin, say what you will (i have a small crypto exposure, have played carefully for a while, made some money), it cannot function as money. Value cannot change that rapidly and be a 'unit of account', 'store of value' and reliable 'means of exchange'.
I think conflating central banking with the backing of a currency is not helpful. Reserve banks operate to backstop private banks as a lender of last resort in a liquidity crunch that is temporary. We run banks fairly well actually in the states. The real problem is we have like 100x more banks/credit unions than we need. State based licensing is a disaster for consumers of financial services. That's why finserv extracts so much. We also need to truly support alternate pay mechanisms, and can do that without abandoning a currency.
I've always found the Taylor Rule and Taylor's monetary thinking quite persuasive. It made me realize that people are the problem, politics is the problem, not the question of what is sound monetary policy. That's obvious. What's really hard to figure out is how to justify obviously irresponsible and destructive policies, and man, our 'betters' in DC and elsewhere seem to be very busy at the Fed being 'Masters of the Universe'.
Only a government can really eff up an economy, a private person or company cannot. One of the thoughts I often have is exploring a govt issued currency with its value is determined solely in markets and money creation is totally private by banks and perhaps other lenders. I think we can find examples of fiat currencies working well for a while. The temptation of the politicians is just too much for them. So put in a market force that punishes them if they abuse the currency or the fisc. We actually have some of this happening today directly and indirectly but it is in no way to we use private money creation as our primary or sole mechanism for doing so.
CUI BONO⁉️ look(in)to the controlled trilateral backer/banksters and take down of that administration and WHY⁉️ (they couldn’t afford to roll two heads in a row)
thems aimed for decades/centuries to bring us to the coups of major resource countries in the control of them slave-trading colonial sames. bitcoin is only now the means useful for totalitarian control. thems got a long game now implemented and WE SOL. it’s already been done SO.
look around at the test subjects for every means to implement this GLOBAL shitshow
of enlightened DARKED
When Empires collapse...
I don't trust Bitcoin or any digital system.
I have yet to have someone explain to me how a gold standard would work while our trading partners have a fiat currency.
For what it's worth, the guy leading the polls to be the next president of Argentina (where they know a thing or two about monetary bombs), Javier Milei, agrees with you on Bitcoin being a reserve currency.
PS - In 1971, dollars were only convertible to gold by FOREIGN GOVERNMENTS, not regular people. Normal folks got shafted way back in FDR's time.