Black People : Why Gold Is Money and Dollars Are Not

Discussion in 'Black People Open Forum' started by ChosenSeed, Feb 14, 2011.

  1. ChosenSeed

    ChosenSeed Well-Known Member MEMBER

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    As it so happens, the one commodity on earth with constant marginal utility turns out to be gold.

    This metal possesses certain characteristics that make it ideal for transporting value over both distance and time. It is important that, through a gradual process that took thousands of years, the marketplace came to realize that gold was money.

    This realization of gold's value is a simple truth that humans discovered over a long time by process of elimination, and not something that was proclaimed by any figures of authority or religion.

    Before gold, many other commodities were tested as the medium of exchange - the intermediate commodity into which all others were first converted. This was to solve the value disputes that were often linked to the barter system.

    In ancient Egypt, learned professionals were paid in beer and grain. Whatever they and their dependents did not consume was a surplus that could be bartered for other commodities and services they might need.


    However, there are major problems using food as money. It is perishable, so it does not transfer value well over time. Also, large value amounts are heavy, so it does not transfer well over distance.

    Subsequently, people tried using live cattle as money. The word "pecuniary" comes from "pecus," the Latin word for cow. Cows transferred value well over distance, as they were easily moved - but of course they too were perishable.

    Salt was also used. The word "salary" comes from the Latin "sel." The mineral was very effective as money since it was not perishable. But it had other problems. It was heavy and difficult to transport in quantity. Also, its relatively low value-to-weight ratio meant you had to lug a lot of it around to make large payments.

    Eventually, after thousands of years of trial and error, the marketplace discovered gold, which solved all of these problems.

    It was durable, portable, divisible, indestructible, ductile and malleable in a way that no other commodity was. It was useful in both art and industry.

    It was universally desired in a way that made each unit as useful as every other. This is the constant marginal utility that only gold possesses, which makes it the most marketable of all commodities, uniquely suited to perform the functions required of money.

    It allows value to be transferred over distance and time better than any other medium of exchange or store of value.

    Note that in order to be a reliable medium of exchange, a commodity must provide a sure store of value, and vice-versa.

    Few people realize that originally, jewelry served as a means of savings. When people used to be nomadic, they would carry their savings with them on their bodies as they moved from place to place. The gold bracelets and necklaces they wore were not only a sign of their social status and display of their wealth - they were an effective means of transporting their savings. This is an early example of gold serving as the finest store of value known to man.

    Hopefully, you now understand what money is. Consequently you should also understand what it is not.

    Those paper bills you carry around in your wallet - the ones called "Federal Reserve Notes" that say "$100" on them - are not money.

    Money is the most marketable commodity, but that commodity is gold - not pieces of paper covered in ink. What you commonly think of as money is in fact a money substitute.

    Money substitutes evolved when people began to deposit their gold with goldsmiths in return for interest.

    The goldsmith would lend out the gold and charge interest to the borrower, then pay a lower rate of interest to the depositor, earning the spread. This was the origin of bank loans. The goldsmith would give the depositor a piece of paper, an IOU, which in effect was a receipt for his gold.

    As long as the gold could be recovered with certainty on demand by the bearer of the IOU, these receipts could change hands, serving just like gold itself. They were literally "good as gold." And that is the origin of those paper bills you carry around in your wallet.

    They were invented as a substitute for the metal, enabling the bearer to exchange them for the metal itself on demand.

    There are two kinds of money substitutes: fiduciary substitutes and fiat substitutes. Fiduciary substitutes are like those described above, where the substitute note can be exchanged for the actual metal.

    The word "fiduciary" comes from the Latin word for "trust." This means that the holder of the note is assured he can use that receipt to reclaim his metal. The note is usually structured as an IOU for a certain amount of metal, payable to the bearer (as opposed to someone who is registered) on demand (as opposed to on schedule). This is what U.S. dollars were when the United States was on a gold standard, before the creation of the Federal Reserve in 1913.

    The dollar was actually defined in the Constitution as a certain weight of metal. A $20 bill was essentially an IOU for an ounce of gold, and the two were completely interchangeable at any bank in the country, on demand. The bill itself was not actually twenty dollars. Rather, it was a promise to deliver "twenty dollars," and those words were nothing more than a convenient name for a certain weight of metal.

    The advent of the Federal Reserve, the Central Bank of the United States, was the beginning of the end of fiduciary substitutes. But it was the beginning of fiat substitutes. "Fiat" is the Latin word meaning "to decree."

    These types of money substitutes do not circulate based on the trust that they can be exchanged for metal. Rather they are backed by a government entity with a legal monopoly on violence. That government declares that the currency is legal tender for all debts, public and private. And this decree is backed up by the standing armies that all governments maintain.

    It is important to realize that fiat money substitutes operate as the medium of exchange only as a result of decree - not because market participants trust or choose such a system. Money is chosen by the market. Fiat money substitutes, such as Federal Reserve notes in their present form, are decreed by the state.

    archive.newsmax.com/money/archives/articles/2006/4/21/162134.cfm

    30 year historical price of gold chart in dollars
    [​IMG]
     
  2. Ankhur

    Ankhur Well-Known Member MEMBER

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    I had told coworkers to purchase gold when Bush Jr,
    got into office and folks laughed at me.
     
  3. paygan

    paygan Member MEMBER

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    Great work bringing this to everyone's attention.

    You've noticed a critical trend.

    The problem nowadays isn't that black people are slaves, it's that the Chinese people are and can produce everything for the entire world. The communist party government are slowly buying up all the Greek, Irish, Portuguese, Spanish, Italian and Belgian debt, before they move on to the rest of us and own the world pretty soon.

    Gold won't be much use, cos they'll have that all too soon. George Soros said that Gold will be the last bubble to burst.

    After that, water is going to be the only real money in my opinion. :)
     
  4. jamesfrmphilly

    jamesfrmphilly going above and beyond PREMIUM MEMBER

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    :qqb009: the chinese army cannot beat the united states army
     
  5. ChosenSeed

    ChosenSeed Well-Known Member MEMBER

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    Yes, and for that reason all the debt they brought is kinda like watching a mafia movie where one of the bosses owes a small time guy some money. Normally when the small time guy asks for his money he immediately ends up dead, or he receives the money, but eventually ends up dead... :lol:

    I want to stress that this "debt" is based upon fiat substitutes and not gold or silver, etc... I'd like it if we all can move towards being more specific in our language in this thread. Money is gold, silver, feduciary substitutes... That paper currency called the dollar is a fiat substitute.

    I'm going to make another thread with an additional economic concept that I think should be more essential to the "black conscious" individual than familiarity with Dr. Ben's works.
     
  6. Ankhur

    Ankhur Well-Known Member MEMBER

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    put the 2 face to face in nothing but sweats and sneakers, and then make a decision.

    Put it this way,
    would your loan shark loan to you if you had more heat then he had?

    Ron Borwn aint alive any more to say anything more about how much militay advnced tech Clinton gave to them

    and after Hu's visit our wonderful Jobs Creation Czar Jeff immelt just gave them some top jet technology,

    but realy banks are not interested in wars for profits sake banks are in the businsess of debt so they are interested in the debt that conflicts create

    Only little nations with big reources are bombed and civilians whacked

    But back to the ish

    The People's gov have been telling their masses to buy gold since
    last "Nowonder"

    here the press tells us it's a conspiracy theory

    while the fat cats have been buying it up with bailout money

    Do the math
     
  7. Ankhur

    Ankhur Well-Known Member MEMBER

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    China has been buying up so much US gold they caught some dirty stuff coming out of Fort Knox

    There's a post on that

    as far as weapons, China aint Russia, they aiint signed nothing to disable thier nukes and they more then likely have technology we dont even know about

    Aint t no UN going over there to look under their rug


    And be clear about China, they hold enough Federal Reserve Bonds and US treasury bonds as well as municipal bonds to sink this nation within the next hour if they had the jollies
     
  8. Ankhur

    Ankhur Well-Known Member MEMBER

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    When I was buying an ounce a month when it was almost 400 and encouraged others to do the same, they said the same exact thing

    Water is limitless, it comes out the sky every day somehwere on the planet, and by tree planting in arid areas can be encouraged to rain there as well

    gold is limited, and the earth does not replenish the depletion
     
  9. jamesfrmphilly

    jamesfrmphilly going above and beyond PREMIUM MEMBER

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    walmart would not let that happen

    china is co dependent with US. we cannot hit them and they cannot hit us. so relax.
     
  10. Ankhur

    Ankhur Well-Known Member MEMBER

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    :qqb011:No worries partner, just that I prefer to be a realist and not liev in a Dinny Land world view like the republicans that beleive the US is on top of the world

    Those billions over there can live quite well in a system of self sufficiency

    It is the US and it's debts that cannot

    Inspite of what FOX news says, there are hundred so f nations China deals with other then the US, if one wants to talk about trade

    They got oil well reserves that they have had 50 years of real communism,

    not to use up, like the US has here


    and gold mine reserves as well

    They got plewnty nice things now but communists can live with very little if need be,


    we on the other hand cannot, and get

    hospitalized carzy,
    if our cable service malfunctions,

    or if the local pizzeria moves goes outa business

    or if all 5 of our cell phones refuse to work:SuN021:
     
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