Testing The Financial Apologists

The handwriting is on the wall, o shaman. read it and weep.

Phat writes in Message 669:Forbes Magazine recently had a good article which I will share.
The Signs Are There: The Gold Standard Is Coming Back by Steve Forbes

It amuses me when the peanut gallery elitists...

...tell me time and time again that I don't know what I am talking about.

Maybe you can write Steve Forbes and tell him the same thing.

You maroons don't have any real clue about how the monetary system has historically worked and does work. Not that I will ever get any respect around here!

Phat writes:They largely use dollars of course. What they don't do is store their wealth as dollars. They may buy short term treasuries for liquidity, but the bulk of many of their fortunes is in hard assets like art, land, precious metals, other commodities such as oil and copper, and a few carefully chosen stocks.

Of course they don't store their wealth as dollars. That would be stupid.

dwise1 writes:How true. We working class stiffs think of money as a sign of wealth, whereas the wealthy think of non-liquid assets such as properties, stock, commodities, collections, etc.
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Cash, the thing we crave, is the stupidest thing to accumulate since it only diminishes in value (due to inflation) and is taxable.

Not only does it take money to make money, but it takes wealth to avoid paying taxes when you use that wealth.

I suffer from those biases as well, and I blame it on growing up in the lower middle class and having money struggles for most of my early adult life. Living paycheck to paycheck was absolutely frightening at times. I think that is why I have way too much money in my checking account right now and am reluctant to put it into longer term investments.

dwise1 writes:Also, agriculture got very busy selling off as much crops as they could before Trump's tariffs and phony trade war started.
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I retired half-way into January of this year. For decades I have used an Excel spreadsheet to figure out what I need to have withheld for income taxes (both my then-wife and I made about the same salary, but the formulae on the W-4 forms always had me withholding too little (thus threatening me with penalties should that persist) so I had to estimate my taxes in order to ensure that enough was being withheld from my pay. One thing I noticed with the new tax scam was that my federal withholding was less, so my take-home pay was more. Now, I have no idea what my taxes will actually be like this year nor does anybody else, but I'm sure that every working American has looked at their paycheck and has thought that they have gotten a big break -- they have more money! Doesn't anybody remember the Big Tax Break from George Bush I (Dubya's father)? His big tax break was to have less taken out through withholding so everybody's take-home pay would be more, but at the end of the year everybody still owed the same amount of tax. A huge swindle from the guy so out of touch with citizens' reality that he was fascinated by a grocery store's laser scanner, a technology which at that time was already about two decades old.
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Basically, this entire GOP tax scam is based on trickle-down economics which has never worked and never will work. We saw this in Gov. Brownback's great Kansas experiment in which he created a trickle-down state economy which brought about economic ruin. At the same time, California faced with economic disaster from 2008 took the opposite approach and has emerged economically strong. In my engineering career, I called that the "Jello Test", as in "the proof of the pudding is in the eating." You have possible solutions to a problem. Run them and see what works. We have tried trickle-down and have found that it does not work. We have tried taxing the rich and that does work. Nu?
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Within the past couple days, I saw (as I recall) a statistic that 65% of the US workforce has to work multiple jobs and still do not qualify as "middle class".
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Now here's a Gedankenexperiment ("thought experiment") that I have conducted myself. Take the "tax break" and distribute it to amongst the 1% (as has already been done). Each one receives somewhere between $33,000 and $330,000 (the actual amount escapes me at the moment). What do they do with that extra money? Practically nothing, which starves the economy.
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OK, in order to establish an economic baseline, let's take the opposite approach of looking at what will happen if, instead of dumping all kinds of money into the hands of the rich, the 1%, we were to distribute that same money to everybody else, the 99%.
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As I recall hearing during the tax scam debates, each of the 1% would be getting $33,000. US population is about 308 million, so 1% of that would be about 3 million and 99% would be about 305 million. $33,000 to each of 3 million people adds up to about $100 billion (10⁹). Now distributing that to each citizen equally, both the 1%-ers and the 99%-ers, and each citizen would receive about $325.
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What would each person in the 99% do with $325? Spend it! Buy food, clothing, and other goods. What would that do for the economy? Sure, $325 doesn't sound like much, but when 305 million people are all spending $325 each, that adds up to $99 billion being injected into the economy. Now that would really rev up the economy.
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But if we instead give all that $100 billion to the 3 million of the 1%, what would they do with that extra $33,000? Virtually nothing. All their basics needs (food, shelter, clothing) have already been met, so they don't any necessary expenses to put that money to. Maybe use it to buy a trinket or an expensive toy (the superyacht market is now booming). Or gamble with it (ie, stock market speculation). Or just shove it into a drawer (metaphorically speaking) and forget they even have it. Whatever they do with it, very little of it would find its way into the economy.
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So instead of revving up the economy, Trump is starving it and trying to smother it.

Theo writes:There is not money without government. Please define public vs private money.

Theo writes:Still waiting for him to show us how well gold and crypto are doing.
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ABE
Seems to be another major crypto crash today. Funny how we don't have to worry about that with fiat currencies.

Phat writes:Do governments determine the value of money or do markets?

China's strategic silver takeover: A calculated move to drain the west
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This article appeared in the Jerusalem Post. I have tried to argue for several years that the Eastern BRICS nations are conducting an economic war against the West and the US Dollar. More sources are now sharing these concerns.

There is more and more evidence that my initial points were sound, if not founded on data. The data is now coming in.
GOLD PRICE in 2022 at the time of Theos message: $ 1,710.00 (Aug average)
GOLD PRICE today in August 2024 before the elections: $2,553.40
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Silver also gained roughly $10.00 an ounce since that time and is being suppressed to this day.

Do governments determine the value of money or do markets?