Always glad to contribute. :) This makes my brain hurt, but I do understand it, by golly. You should be a prof. Anyway, it's still a big mess. My husband and I work in ministry. We're not part of the prosperity-gospel group, so we make measly salaries compared to other people who make a killing off their congregation or have similar educational backgrounds. Of all the groups who see their pay go up, even if not keeping with inflation, ours usually does not, so it's kind of a slap, kick, punch every time prices go up. We choose to stay in our jobs because we believe we are helping others, and that is worth something. And I shan't complain. God has taken care of us plenty fine.
I am always hopeful that people come away from my content with at least a few more things about which to think, so thank you for the kind words!
I am always grateful for all the ideas that people offer up when they comment on my work. It is no exaggeration to say that I learn much from my readers!
That same amount of quarters if they were still silver would have a melt value of $30 at today's silver price of around $34 an ounce.
So if you got just a minimum wage today of just $1.25 per hour paid in silver quarters (which I would call sound money), you would be making a far better hourly wage ($30) than many people get!!!
Individual consumers generally prefer sound money. Bankers and governments generally oppose sound money. Businesses will have a love-hate relationship with sound money depending on their lines of business and overall strategies.
However, short of a complete reconstruction of the global financial system, sound money is not going to happen.
The first reason is that no government wants sound money, and no bank wants to deal in sound money. We know this because every other nation went along with Nixon ending gold convertability in 1971.
As a result of Bretton Woods, the dollar had been established as not merely a de facto reserve currency but as the de jure reserve currency. The other leading currencies of the world had their exchange rates set in dollars under Bretton Woods, with the dollar maintaining the connection to gold. Accordingly, when Nixon took the US off the gold standard he effectively took the entire world off the gold standard. While the nations of the world initially howled like mashed cats, no nation pushed to put their currency independently on a gold standard.
Today, no nation can revert to a gold standard--no nation has enough gold. Even adding silver to the mix in a bi-metallic standard does not get any nation's reserves of precious metal to a level sufficient to support its currency at existing levels. Putting the dollar, the pound sterling, or even the yuan on a gold standard would require massive currency revaluations which would also destablize existing financial markets. I'm not sure what reverting to a gold standard for the dollar would do to the world's derivatives markets, but with a notional aggregate value of over a quadrillion dollars, it is difficult to envision any disruption to that market as being anything other than apocalyptic in nature.
Thus, the only way to get to sound money is to completely jettison the exisitng financial system entirely. I don't see that happening incrementally, which means the existing system has to collapse first.
Good analysis, this would make an article in itself. Basically you might just title it. - " We Are F#!ked!"
The reason no one could cover their currency without revaluations is due to money printing and the creation of derivatives in the first place.
Perhaps if the markets ,Comex and other exchanges were not run like casinos and if banks would actually get punished for their violations instead of getting a million dollar fine after making ten times that much in rigged trades, etc., we could've possibly returned to sound money. But I agree with you there are too many variables to the equation now unless a total collapse happens, which it still could..
This post provides some helpful perspective. Also need to recognize the inherent difficulties in measuring consumer prices over time. BLS tells us that they base prices on a sample of places people actually purchase goods. So, for example, as the neighborhood grocer is replaced by Costco, prices appear to decrease because Costco is on average cheaper than the neighborhood grocer. But the difficulty the consumer faces, having to travel a longer distance to make purchases, isn't recognized.
Similarly, over here in wokeville, we now have to pay an extra fee to get bags for our groceries. BLS tells us that this fee isn't included in the Consumer Price Index, and in fact cannot be because BLS cannot know how many bags will be needed.
Everyone should read this. EVERYONE.
Always glad to contribute. :) This makes my brain hurt, but I do understand it, by golly. You should be a prof. Anyway, it's still a big mess. My husband and I work in ministry. We're not part of the prosperity-gospel group, so we make measly salaries compared to other people who make a killing off their congregation or have similar educational backgrounds. Of all the groups who see their pay go up, even if not keeping with inflation, ours usually does not, so it's kind of a slap, kick, punch every time prices go up. We choose to stay in our jobs because we believe we are helping others, and that is worth something. And I shan't complain. God has taken care of us plenty fine.
I am always hopeful that people come away from my content with at least a few more things about which to think, so thank you for the kind words!
I am always grateful for all the ideas that people offer up when they comment on my work. It is no exaggeration to say that I learn much from my readers!
Also we need sound money when looking at the overall picture of wages and hours worked.
For example I did an image on my Substack https://watchman2016.substack.com/p/image-for-the-day-from-httpsnothingnewunderthesu-e02 and on my web site on 10/21 showing that in 1964 minimum wage was $1.25 which at the time was 5 silver quarters.
That same amount of quarters if they were still silver would have a melt value of $30 at today's silver price of around $34 an ounce.
So if you got just a minimum wage today of just $1.25 per hour paid in silver quarters (which I would call sound money), you would be making a far better hourly wage ($30) than many people get!!!
Linking as usual, Peter @https://nothingnewunderthesun2016.com/
Individual consumers generally prefer sound money. Bankers and governments generally oppose sound money. Businesses will have a love-hate relationship with sound money depending on their lines of business and overall strategies.
However, short of a complete reconstruction of the global financial system, sound money is not going to happen.
The first reason is that no government wants sound money, and no bank wants to deal in sound money. We know this because every other nation went along with Nixon ending gold convertability in 1971.
As a result of Bretton Woods, the dollar had been established as not merely a de facto reserve currency but as the de jure reserve currency. The other leading currencies of the world had their exchange rates set in dollars under Bretton Woods, with the dollar maintaining the connection to gold. Accordingly, when Nixon took the US off the gold standard he effectively took the entire world off the gold standard. While the nations of the world initially howled like mashed cats, no nation pushed to put their currency independently on a gold standard.
Today, no nation can revert to a gold standard--no nation has enough gold. Even adding silver to the mix in a bi-metallic standard does not get any nation's reserves of precious metal to a level sufficient to support its currency at existing levels. Putting the dollar, the pound sterling, or even the yuan on a gold standard would require massive currency revaluations which would also destablize existing financial markets. I'm not sure what reverting to a gold standard for the dollar would do to the world's derivatives markets, but with a notional aggregate value of over a quadrillion dollars, it is difficult to envision any disruption to that market as being anything other than apocalyptic in nature.
Thus, the only way to get to sound money is to completely jettison the exisitng financial system entirely. I don't see that happening incrementally, which means the existing system has to collapse first.
Good analysis, this would make an article in itself. Basically you might just title it. - " We Are F#!ked!"
The reason no one could cover their currency without revaluations is due to money printing and the creation of derivatives in the first place.
Perhaps if the markets ,Comex and other exchanges were not run like casinos and if banks would actually get punished for their violations instead of getting a million dollar fine after making ten times that much in rigged trades, etc., we could've possibly returned to sound money. But I agree with you there are too many variables to the equation now unless a total collapse happens, which it still could..
Actually, I am working on just such an article!
LMK, but I'm sure I'll see it. Don't have to use my title suggestion. LOL!!!
This post provides some helpful perspective. Also need to recognize the inherent difficulties in measuring consumer prices over time. BLS tells us that they base prices on a sample of places people actually purchase goods. So, for example, as the neighborhood grocer is replaced by Costco, prices appear to decrease because Costco is on average cheaper than the neighborhood grocer. But the difficulty the consumer faces, having to travel a longer distance to make purchases, isn't recognized.
Similarly, over here in wokeville, we now have to pay an extra fee to get bags for our groceries. BLS tells us that this fee isn't included in the Consumer Price Index, and in fact cannot be because BLS cannot know how many bags will be needed.