Some advice from a super-genius! *Me!* :)

[Alondro]

To all the forumites in the USA,

I was going to go into some big analysis and all, but that'd be too boring.

Buy silver.  It's price is going to go up soon.  I'm buying two pounds of it this week, hopefully I'll beat the price upswing.

Inflation and demand are driving the commodities markets, especially in precious metals.  Silver is the only one that hasn't had a dramatic spike.  If I go by the spike circa 1980, I expect it to double in value over the next year.

At the very least, it'll hold value as the dollar continues to weaken.

Just some advice to all those saving huge jars of coins!  We had about $700 just sitting around when I got through counting it all!   It's better to have it sitting around as a metal that won't keep losing value over time. 

[Fuyudenki]

Actually, I was informed the price was about to drop, so I've told my dad to inform me when that happens, and I'll give him some money to buy it with.

Same idea, though.  The US dollar is on a course for worthlessness.  I'd prefer a currency explicitly based on precious metals.

(More gold is about to be released on the market, which will drop the price a bit, and silver tends to follow gold, is what I was told.)

[edit]Right.  Missed the crash.  Fortunately, my dad didn't.  Soon as I've covered gas for the week, I'll be investing.[/edit]

[rabid_fox]

I have plenty of silver, just in case of a Werewolf Apocalypse.

[Alondro]

I have plenty of silver, just in case of a Werewolf Apocalypse.

You look kinda like a werewolf in yer picture there... 

On the financial side More Doom .

Wonder how much more the economy can take before my predicted collapse occurs.   

[rabid_fox]

I will not side with my brethren in the uprising. 

[techmaster-glitch]

Same idea, though.  The US dollar is on a course for worthlessness.  I'd prefer a currency explicitly based on precious metals.

Isn't the Great Depression the reason why we abandoned the gold standard?

[Valynth]

Same idea, though.  The US dollar is on a course for worthlessness.  I'd prefer a currency explicitly based on precious metals.

Isn't the Great Depression the reason why we abandoned the gold standard?

That and it ties the currency to a commodity that is not under human or governmental controll and essentially leaves us to the mercy of our natural resources.

[llearch n'n'daCorna]

Isn't the Great Depression the reason why we abandoned the gold standard?

Not exactly that simple, but more or less, yes.

According to the wikipedia article (ie, I'm talking out of my arse), the reasons are something like the Gold Standard limits what governments can do to retard inflation, and the gold standard that many governments were using at the time was one of the contributing factors to the Great Depression itself.

So... at about that time, the US govt moved away from the Gold Standard, as did the UK, and several others. It wasn't -because- of the Great Depression. It wasn't -causing- the Great Depression. But they were all related.


Economics is such a complicated subject. :-/

[Fuyudenki]

I was under the impression that the Great Depression was caused by American materialism, with people buying things on credit and never really getting around to paying them off.

That, and FDR took their gold away.(I'd have said "our," except I wasn't around until a good 50 years or so later.)

[Pagan]

Well, you hit on something there.
It was more the idea that people were buying stocks on credit and they were using this stock-- with a highly liquid value-- as collateral. One day, people started selling stock, stock prices went down, people went into a panic. Rampant selling and crashing stock prices. Suddenly stocks weren't worth as much so people withdrew everything from the banks, the banks didn't have enough cash money to respond to the withdrawl requests.

I know this isn't perfect, and I know I'm probably forgetting somethings there, but that's what I can remember of the start of the depression of the 30's.

[Fuyudenki]

Buying something that didn't actually exist and then trying to cash in on it, eh?

Same think as a Run on a bank, which was made ineffective by the FDIC(which simply creates more money when the bank goes broke).  I'd definitely prefer something more tangible.

As for being at the "mercy of nature,"  Forests which man wiped out 100 years ago have returned in spades.  The settlements said forests were cleared to make room for are little more than crumbled walls.  You tell me who I should side with.

[Valynth]

Gold is not organic; it does not grow back.  There is a set limit to how much gold exists in the planet at any given point.  There is not a limit to the number of people on the planet.  As the population grows there isn't enough gold to go around and you end up with a massive lower class that often can't operate as effectively as a middle class corporation and are therefore the lower class becomes a drain on the system.

There also the fact that simply whoever doesn't abide by the gold standard can have it's currency used to pump gold out of the gold standard country resulting in large inflation for the gold standard country.  That was yet another reason why we dropped the standard.  There was even an investigation held to make sure our gold in Fort Knox was still there because of worries that it had been pumped out.

[Alondro]

The golden rule:  He who has the gold makes the rules

And soon I shall have it all!   

Just as soon as I deal with that annoying 007... 

[Fuyudenki]

Gold is not organic; it does not grow back.  There is a set limit to how much gold exists in the planet at any given point.  There is not a limit to the number of people on the planet.  As the population grows there isn't enough gold to go around and you end up with a massive lower class that often can't operate as effectively as a middle class corporation and are therefore the lower class becomes a drain on the system.

There also the fact that simply whoever doesn't abide by the gold standard can have it's currency used to pump gold out of the gold standard country resulting in large inflation for the gold standard country.  That was yet another reason why we dropped the standard.  There was even an investigation held to make sure our gold in Fort Knox was still there because of worries that it had been pumped out.

What you're listing as a problem I actually see as a benefit.  Since you can't just churn out more gold(not cost-effectively, at least), it'll maintain its value, even if everyone eventually has very little of it.

By comparison, if you have a thousand dollars, and you run off another thousand, the value of each dollar has now dropped by 50%.  This is largely why the US dollar is currently crashing, and other countries will get wise very quickly that you have no qualms about printing off more currency when you run out, so they're going to increase their gold prices exponentially, and you'll actually end up owing them money.

The golden rule:  He who has the gold makes the rules

And soon I shall have it all!   

Just as soon as I deal with that annoying 007... 

Don't forget the guy with the finger.

[Valynth]

The current reduction of the U.S. market is because people aren't paying their debts because they don't have enough money.  Pay attention please.

[Alondro]

Well, it seems I'm not the only one who sees the silver market growing in the near future!

The coin and metals place I went to had sold so many of the common silver coins and new silver Eagles in the past week, that I pretty much bought out what they had left!  And I had some money to spare.   

[Fuyudenki]

The current reduction of the U.S. market is because people aren't paying their debts because they don't have enough money.  Pay attention please.

Hmm, what, so they decided to raise minimum wage again?

Minimum wage was increased in my hometown of Colorado Springs.  As a result, the price of a McDonalds Happy Meal also went up(to pay the McDonalds workers while still turning a profit), and the dance studio I attend is raising their group lessons from $5 an hour to $7 an hour.  The wage hike drove inflation.  It always does, and this wage hike was written to follow inflation, meaning the US dollar in Colorado Springs is on the fast track to worthless.

So why don't you burn 'em?

Because then I'd have nothing to hit you with!

At this point, I think the dollar is losing value because people are losing faith in it, and want to exchange it for something else.  Anything else.  It's like an old-fashioned Bank Run, except this time, the "bank" is the entire United States treasury, and their response of printing more money is just going to make it even more worthless.

So Americans aren't paying their debts.  I say "they" because I only have one, and it's to my parents.

So Americans aren't paying their debts because they lack money.  Whose fault is that?  Just like in the Great Depression, they've bought things on credit, and now can't answer for it.

Great plan, you idiot!

So what's printing off more money and handing it out going to do?  Sure, everyone'll have more money, but it'll be worth less, and the interest on the debts will grow to reflect that.  So by printing off more money, you've actually dug everyone deeper into debt.  Congratulations, there's a mob of people at the door.  They've got pitchforks and torches, and they want to "speak" with you.

But you know what?  Since you would rather have Dollars than gold so much, I'm willing to buy any and all gold and/or silver you've got.  Whadaya say?

My, Grandma, what large teeth you have.

[Valynth]

The current reduction of the U.S. market is because people aren't paying their debts because they don't have enough money.  Pay attention please.

Hmm, what, so they decided to raise minimum wage again?

Minimum wage was increased in my hometown of Colorado Springs.  As a result, the price of a McDonalds Happy Meal also went up(to pay the McDonalds workers while still turning a profit), and the dance studio I attend is raising their group lessons from $5 an hour to $7 an hour.  The wage hike drove inflation.  It always does, and this wage hike was written to follow inflation, meaning the US dollar in Colorado Springs is on the fast track to worthless.

First of all, that's a localized event and hardly represents the whole.

Secondly, that's not inflation.  That's making it cost more to produce the same quantity, not the value of the money itself.

Thirdly, gold is just as variable from country to country.  That's, as I've stated, the way people have nearly destroyed nations by pumping gold out.

Finally, the real problem is that the American people started living beyond their means and should be facing the cost of that, but instead of taking responsibility for their mistakes and working to fix them, they turn to the Feds to bail them out causing everyone who gave them a loan to lose money.  In the case of the bank, that money happens to be some one else's money so essentially all the people who aren't paying their loans are performing day-light robbery of honest people.

[Fuyudenki]

Secondly, that's not inflation.  That's making it cost more to produce the same quantity, not the value of the money itself.

Ah.  Ok, since we're apparently arguing on the same side of the coin everywhere else...

If that's not inflation, what's inflation?

[Alondro]

According to REAL inflation estimates, which are still including the prices of food, fuel, and the production of excess currency, we may be dealing with up to 20% inflation for the past year.

There are also more indications of a US crash:  a number of nations are not just talking about dumping their reserves of US currency, they're already doing it.  The Netherlands and Vietnam have begun it, Iran and Venezuela are happily jumping on board as well since they hate us anyway, and pretty much the entire oil production region of the Middle East is talking about beginning to shift to Euros since their US reserves have lost so much value. 

There were some editorials in the Wall Street Journal noting that Greenspan is worrying at at least a recession as bad as right after WWII, and some are at long last hinting that there is a real potential for a repeat of 1929.  The Fed can only bail the economy out so much.  One huge problem is that the USA has become too much a consumer economy.  As the currency keeps devaluing, our imports become more and more expensive and debt load grows.  We can't increase our exports enough to make up the balance, we don't have the manufacturing capacity to make things for ourselves and even if we did the cost would be higher and people would buy less.

What we need to fix everything is what fixed the Great Depression... another world war.   World population could use some trimmin' anyways! 

*WWIII will be fought with nuclear weapons... WWIV will be fought with sticks and stones... and MY stick has a nail in it for the win!    *