In 2006/2007 I was paid for a project in e-gold[0]. Another currency backed by gold bullion. I never saw the gold, never touched it, but was assured it was there, really. The whole thing went tits up because it was a scam. Being in Texas and not Panama I guess this is slightly less scammy. But I suspect the people who want to hold gold will simply buy gold. And skip the questionably middleman.
The problem is fraction reserves, as soon as that fraud is legalized, the entire marketplace is by definition fraudulent. If they did have reserves and fraction reserve was suddenly legalized, you get retroactively robbed in a sense.
Holding gold would appeal to me but is impossible. I won't dedicate my life, hell or high water, to one country. You can't just up and carry stuff across nation borders. It is a total nightmare. In fact, every time I enter Thailand (and who knows how many other countries) I break the law. The limit for undeclared personal affects is exceeded by a single tshirt or pair of jeans in my luggage, since, well I wear all designer. Strikes me as beyond absurd how the world works ever since the idiocy of passports, permission, and visas was introduced:(
One of the worst inventions in history imo.
I think Ukraine should remind us all not to trust everything to one country. All your eggs in one basket
Fair enough. To be specific, as opposed to immediately before passports were invented
I imagine it was similar to what it was like:
1. Before police patrolled in America
2. Before driver's licenses (you can still experience this in Cambodia, low CC scooters don't require a license)
3. Before tattoo artists needed a medical license in Japan and Korea
Ya know, liberty and basic rights that have now been abrogated to such a degree that the herd not only doesn't remember what they were like, but actually questions the validity of even being that "free". (Populations like China tend to think a central authority not controlling speech is absurd too.)
While I tend to systematically doubt anything that "represents" gold supposedly stored somewhere and therefore tend to agree with the sentiment, I believe that if an actual state were to implement this, along with:
- a system of independent, redundant audits of the reserves (independent as in: they would not live in Texas)
- a blockchain to track and record for all eternity the state of the currency *and* the audits
- a guarantee etched in stone in the Texas constitution that the e-currency is - by law - instantly convertible to the real thing (and by that, I mean actual gold, not the current market rate equivalent in toilet paper).
then it would have a chance of succeeding.
But again, there are so many ways to cheat and lie when you manage a gold "reserve", including storing fake gold, that - indeed - while this would be a lot easier to handle and trade with than real gold, it would still not replace it.
The Wikipedia article* makes it sound fairly legit, and that it collapsed because it didn't verify members well and so was used for illegal purposes. But not because it was a scam. It reads that it was widely used, and the article _implies_ it was genuinely backed by gold.
Do you have more insight here? I'd never heard of E-gold before today.
> When someone holding the digital currency wants to redeem it for cash, all they would need to do is present it to the comptroller or a designated agent, who will then sell gold held in the depository account equal to the redemption amount and transfer the funds to the redeemer, minus any fees.
> The value of each unit of the digital currency will be determined at the time of a transaction and “must be equal to the value of the appropriate fraction of a troy ounce of gold at the time of that transaction.”
If this were actually put into effect, expect intense interest from current long-term owners of gold ETFs e.g. GLD. GLD steadily declines relative to spot bullion, as a means of charging to holders expenses of storage, security and management. The Texas proposal would apparently cover such costs entirely with fees on exchange transactions, making long-term holders something like free riders on the system.
> No State shall .. make any Thing but gold and silver Coin a Tender in Payment of Debts
the legislators are looking to require the state comptroller to establish a digital currency that is fully backed by gold and fully redeemable in cash or gold.
The U.S. UCC (Uniform Commercial Code) was modified in July 2022 to recognize CERs (controllable electronic records), a flexible definition that may encompass current and future digital currencies. It's now up to individual U.S. states to ratify the proposed UCC changes in state legislation, https://www.clearygottlieb.com//news-and-insights/publicatio...
> Control under Article 12 is designed to be a technology-neutral functional equivalent of “possession.” It generally encompasses circumstances when a party has the “private key” or other mechanism to avail itself of substantially all of the benefits of the record, prevent others from availing themselves of such benefits, and transfer the record and associated benefits.
The use of the term "currency" in the bills is probably ill-advised for just that reason, but states can, under certain circumstances, issue bank notes that act essentially as currency or bills of credit; Briscoe v. Bank of Commonwealth of Kentucky, 36 U.S. 257 (1837) found such bank notes constitutional so long as they aren't issued under color state sovereignty -- that is, they must trade on "no pledge of the faith of the state, in any form." (The federal government eventually killed off state bank notes, not by attempting to outlaw them directly -- AFAIK! -- but by taxing them aggressively, though I don't believe those laws are on the books any more.)
Having said that, the fact that these bills direct the state to establish the program, fixes in law the redemption of the "currency," and directs the state to hold gold reserves for the currency all suggest that this is Constitutionally questionable, because the bill is trading on "the faith of the state." Consider that, if Texas establishes a gold-backed stablecoin then executes a rug-pull, your legal options as an aggrieved party are limited due to state sovereignty, which is precisely the issue that the Constitution seeks to prevent (though at the time the question of sovereign immunity was somewhat less settled in the absence of the Eleventh Amendment).
Politicians: "Capitalism is unstable and we need regulators to control it and promote stability."
Capitalists: "We want to make something more stable than the current system."
Regulators: "Whoa there! Hold those horses! That ain't a move in the playbook! What will these madmen think of next, a full reserve bank? Shut that scheme down now!"
The 3 act play making sure the system is safe unprincipled men since ... I dunno, maybe forever. I doubt this Texan scheme will have a long life either.
I hope they use an existing, leading-edge project. There are some very advanced and capable cryptocurrencies. Or Ethereum which is catching up and would be amazing.
It seems like the US would just try to block something like this on principle though. Having your own currency puts you in competition with other countries, doesn't it? And that's not part of the concept of a (US) state.
> On May 2, a Texas House committee passed a bill to create 100% reserve gold and silver-backed transactional currencies ... HB4903 will now move to the Calendars Committee. This committee determines which bills move to the House floor for a vote.
Reading through it sounds like the comptroller may not be buying physical gold to be delivered and stored at the texas facility. But buying paper representing gold stored somewhere else. I see a future filled with financial shenanigans where more and more complex layers of papers/futures/derivatives/etc become allowed to 'represent' gold, all ripe for exploitation and fraud (just like the the existing crypto, real estate, stock market, and fiat systems!). The more things change, the more they stay the same.
The state of Texas has run a "depository" for precious metals since 2018. In practice, it operates as a sort of specialized safe deposit vault, with holdings of each account kept segregated:
Yes. It is the stated position of the Texas GOP that they should secede.
"33. State Sovereignty: Pursuant to Article 1, Section 1, of the Texas Constitution, the federal government199
has impaired our right of local self-government. Therefore, federally mandated legislation that infringes200
upon the 10th Amendment rights of Texas should be ignored, opposed, refused, and nullified. Texas201
retains the right to secede from the United States, and the Texas Legislature should be called upon to202
pass a referendum consistent thereto."
I suppose it depends on what "pass a referendum consistent thereto" means. I have no idea.
My suspicion is that it's talking out of both sides of their mouth. It means they can go to any kooks and say "We want to secede", while saying to everybody else "oh, it's just a referendum to re-assert what we already claim to be true, just for funsies".
> I suppose it depends on what "pass a referendum consistent thereto" means. I have no idea.
It means enacting legislation for a secession referendum, and holding the referendum. It doesn’t mean secession is going to win the referendum.
If Texas held a secession referendum tomorrow, I doubt “Yes” would get anywhere near a majority-and I’m sure they know that. It would be an exercise in moving the Overton window, not in actually seceding. Which I think is their whole point-actual secession would be enormously risky for unclear benefit, making it a topic of live political debate could have great reward for some.
That does seem consistent with my suggestion that it was talking out of both sides of their mouth. I'm quite certain they're not saying out loud that they expect it to fail. And that they are making promises in some quarters that they will endeavor to see it pass.
Secessionist threats can be a useful strategy to get what you want. Spain and the UK are examples of countries whose increased decentralisation (greater power for regional governments) is largely an attempt to subdue secessionist demands, if those secessionist demands had never existed that decentralisation may well never have happened-certainly not to the same degree. Similarly, the Canadian political establishment invested immense resources in constitutional reforms to try to satisfy Quebec nationalists (the Meech Lake Accord and Charlottetown Accord), although those reforms failed - without the threat of Quebec secession they likely never would have put so much time into it.
Whether that strategy works as well in the very different political context of the US remains to be seen, but it isn’t impossible that it might
The question was resolved n 1865 with a lot of bullets and a lot of dead soldiers. Texas joined the Union in 1845, btw.
These are chucklehead GOP politicians who only have a seat through gerrymandering. I suspect if this was to go to referendum it wouldn't get far. The most citizens of their largest cities have no interest in secession.
No. They couldn't if they wanted to. There is no legal or constitutional basis for a state to secede. How would that even work? It's not like they can force people to leave the US and strip them of their citizenship. Are they just going to kick out over half the people in Texas? Besides Texas' economy would collapse immediately. There would be a mass exodus of businesses. Texas would be completely cut off from the national banking system. It's an absurd idea.
If it were to happen "legally", instead of "civil war II: the farce", I suppose the obvious bit would be to pass a constitutional amendment[1] to allow Texas to secede, probably after a Texit referendum. Presumably similarly to Brexit all the nitty gritty minor details like "not destroying the economy" can be worked out in negotiation between Texas and the USA, which will no doubt leave the newly independent Texas in a worse place and generally unhappy, but FREEEEEEEE.
[1] "Why would the other states ratify this?" you ask? Lets not quibble over minor details in silly make believe scenarios.
The article that allowed the UK to leave the EU was specifically crafted for the UK at the time they joined. The EU realized that mistake right away and removed it for future members.
No such agreement exists in the Constitution because having states come and go as they please would be incredibly dumb.
(As for the US, I did say actually passing a constitutional amendment to allow succession would be unlikely, but I don't think it's legally impossible?)
>As for the US, I did say actually passing a constitutional amendment to allow succession would be unlikely, but I don't think it's legally impossible?
Why would you need a constitutional amendment for more seasons of a popular TV show?
Even if the producers don't want to make any more episodes, all it would take is the money to acquire the rights to the show and pay for production costs. No Constitutional Amendment (or even a law) required.
I mean the popular support isn't there but they'd in reality only need the support of the texas national guard. A traitor president also helps.
And you also have a ton of people who go "who cares, let them leave" like they're breaking up with a romantic partner lol, absolutley no sense of patriotism.
I mean, I don't care if it is texas, missisipi or claifornia, I am an american and all of it is mine. Whether it is a buch of small skirmishes or a full on civil war again, sececession can only be accomplished by a lot of blood spilled. I can't stand guns and I don't even care enough about politics to vote but if any state tries to secede, I would join whatever military opposing them or just buy a gun and find a secessionist armed soldier to kill and hope that I have a death as honorable as fighting to defend your homeland, sure bests rotting in a bed or in a hospital. Even if I can't get others to join me I can contribute just my tiny drop of blood to the price that needs to be paid to separate a land from its people.
Now, there is exactly one scenario where I'd have no opposition to them seceding: if the constitution is changed to get rid of the electoral college, senatorial representation or if religious rights are infringed upon (even by a SCOTUS decision), and I don't mean protections for miniorities who disagree with a religion but anything that prevents people from sincerely believing (not satanists whose belief according to themselves is fake! For example) in a creator and acting on that belief (including voting). Because before you are a citizen you are a human and before you have legal rights you have natural rights that supersede legal rights(see: declararion of independence) which were the foundation and reasoning used to justify America's secession from Britain.
For Texas secessionists though, all they can acheive is destabilization of the US and as a result the whole world. Russia and China's wet dream but my take on it is that secession is as realistic as a neo-nazi white nationalist state.
> Whether it is a buch of small skirmishes or a full on civil war again, sececession can only be accomplished by a lot of blood spilled.
There have been peaceful secessions in the past - the split of Czechia and Slovakia back in 1993 was one example. And I believe that both Scotland and Catalonia can achieve a peaceful secession, assuming that their respective central governments decide to actually listen to the will of the people.
>Why should we be forced in this country of 300 million people to agree on everything?
It's more like 340,000,000 and no one is forcing anyone to agree about anything.
There are many things about which I disagree with my neighbors/friends/family/local, state and Federal governments, but I feel no no need to justify such disagreements to them (or anyone else, for that matter), nor are their choices/ideas impinging on my ability to disagree (or agree, for that matter) about anything.
And even if I vehemently disagree, that's no reason to commit acts of violence and/or attempt to secede from the Union.
What is it, exactly (not vague pronouncements or complaints about what other people think, say or do), that makes you feel like you must agree with everyone else?
>People have to agree on certain basic values to workable operate the kind of sweeping federal government we have.
Sorry for the late reply.
Absolutely. Things like the rule of law (which is mostly the case in the US, with certain really frustrating exceptions -- we should all be treated equally under that law), free and fair elections (there are significant issues there -- especially with gerrymandering and the politicization of the officials who run elections -- e.g., state Secretaries of State) which, we mostly have.
I'd add well-regulated capitalism/market economy, which is something of an issue (the sewer of filthy lucre in our political system is the primary culprit in causing problems) here.
Freedom (although not unlimited, but pretty expansive) of expression and thought are also important.
Most everything else should be left to individuals and communities.
While the US system certainly has some significant issues, that's not because (IMNSHO) we (the collective 'we', in the vast majority) agree on the above.
The enormous amounts of money in our political system is the biggest issue, with gerrymandering and the (often codified into law in the several states) hegemony of the two-party system not far behind.
So no. Americans as a population are mostly in agreement about important things, making compromise possible. But the hegemony of the two-party system creates perverse incentives to demonize the other party and eschew cooperation for fear of alienating the constituencies the parties have riled up by "othering" their fellow Americans.
Publicly funded, non-partisan elections, along with regular geometric shapes for congressional districts would go a long way to fix those problems.
I don't care about culture and people. I'm an american, all of the land is mine as it is for any american. You don't need to agree on everything and I couldn't care less about that, even if there is a civil war, so long as the war is about who controls all of the US I may not care as much. The land and it's resources are mine and ours to share, no one gets to take that away for themselves because they own property around nearby.
I mean, a ton if land even in texas doesn't even belong to texas. And texas itself is a state in the union, it does not have sole ownership of the land it just happens to be government of the people who live on that land. All of the US is american land first and last.
That's one of the crazier political rabbit holes to go down. There are reasonable and/or reasonable-sounding arguments for pretty much every position and those arguments have been rehashed in every imaginable way for decades and decades. Online there's probably tens of gigabytes of debate between "hard money" advocates and "fiat" or inflationary currency advocates.
After seeing endless debates between various schools of economics for decades, in the end I've come to the conclusion that nobody really knows what they're talking about.
A big problem is that history is an experiment with no replications, no controls, and no good way to tie complex causes to complex effects. "What would the past 100 years have looked like had we kept the dollar pegged to gold?" We don't know and we'll never know. All you can do is tell just-so stories. Did having an inflationary currency help us achieve the remarkable growth of the past hundred years? We can't know that either. For all we know all that growth was due to demographics and technology and would have happened regardless of the monetary system.
I wonder if maybe it doesn't matter that much, and so in that sense both sides are wrong. Maybe the real basis of the economy is the real economy (people, capital, resources, technology) and what you use to price it is secondary. So as long as your monetary system avoids extreme failure modes like hyperinflation or extreme deflationary collapse, the system will just adapt to whatever monetary base it's given and price signals will do their job.
All money is fiat money, in the sense that value is based entirely on social negotiation and agreement, not inherent use value.
Anyone who doesn't understand this should try eating gold. Or an ETF. Or a dollar bill.
Of course gold does have some use value, but so do plenty of other metals. The only special thing about it is that it has a history of being valuable - already a social agreement - and it gives a very clear agreed social signal when used in jewellery.
> We don't know and we'll never know. All you can do is tell just-so stories
You can compare the permanent boom and bust cycle the global economy was in prior to the Great Depression to the relatively stable inflationary environment of the last several decades.
Specie based money (with not meaningful monetary policy) is not stable, in fact it's less stable than Fiat money it's just that periods of high inflation are followed by periods of very high deflation. And unpredictability is clearly an obvious downside...
(to be fair I almost thoroughly disagree with your reasoning).
We can't run an experiment to determine causation.
A lot of things happened since WWII. The whole way our government works shifted more toward centralization as a result of the war. Better information and communication technology could have allowed markets to operate more efficiently. Loads of European and Asian productivity was smashed in the war, distorting global trade toward America. A generation received a collective military experience. Women entered the workforce in large numbers. On and on and on...
> We can't run an experiment to determine causation.
Just like with most/almost all complex systems. I don't see this as a good reason to handwave all the arguments or reasoning somebody happens to disagree with.
There are two issues (and there is plenty of empirical evidence for them, since we've actually observed this):
- Ensuring price/currency stability in a globalized market is almost impossible without very strict capital controls. You get long-term price stability at a cost of very high short term volatility that's a core feature of the gold standard in basically any non stagnant economy. High short term volatility leads to financial instability due to higher uncertainty etc. which again puts the economy in a permanent boom and bust cycle.
- The ability of central banks to respond to economic crises is severely limited. Can't really use monetary policy to to stabilize the economy, stimulate growth or decrease unemployment are severely limited. Between the 1830s and 1930s there were three events which were called the 'Great depression' (well that is unless the next one when the previous one was renamed to something like the 'long' depression for instance...). How many 'economic depression' were there in the last 90 years?
> Did having an inflationary currency help us achieve the remarkable growth of the past hundred years? We can't know that either.
Well leaving the gold standard certainly helped countries start recovering from the Great Depression:
> In the end, recovery from the Great Depression does not begin until countries give up on the combination of the Bagehot Rule and of commitment to sound gold-standard finance. Those countries that have central banks willing to print up enough money so that people are willing to spend it--it is when you adopt such policies that your economy begins to recover. If you don’t, you become France, which sticks to the gold standard all the way up to 1937, and never gets a recovery. When World War II begins, Nazi Germany’s production--equal to France's in 1933--had doubled between 1933 and 1939. French production had fallen by 15%.
Ideally having neither too much nor too little money circulating is best, but it's impossible to do that, so it's better to have a little too much, as having too little hampers your economy:
Gold is not deflationary from monetary perspective. More gold is mined constantly. Due to its high stock-to-flow ratio, the monetary inflation is very low.
From the perspective of CPI (consumer price index), gold would be "deflationary", because prices would get cheaper. However, this is not a property of gold; it's the property of a capitalist economy, where companies compete to offer better products at cheaper prices.
There's no good reason for diluting the currency to keep prices increasing, other than corruption and greed of those who control the money supply. Inflationary currency means that someone is profiting by creating money, and that profit is paid in the increasing price of products.
Deflation mostly matters with currency. Deflation of products is a good thing.
The problem with deflating currency is that it encourages you to sit on it. Economists don't want you sitting on a hoard like a dragon. In the extreme case, GDP goes to zero today because everybody is expecting prices to be cheaper tomorrow. Then all the workers get fired because there's nothing to produce. Now they have no money, and buy nothing, so it gets even worse.
Obviously the extreme case doesn't happen, but the thought experiment illustrates the problem. A tiny bit of inflation encourages purchasing and investment, which keeps money moving. You may want to stop working as an individual once you've acquired enough money, but the nation as a whole never retires, and relies on consumption to give everybody work.
Prices of goods coming down is OK, because goods are consumed. You have to buy new goods tomorrow. Durable goods wear out; real estate is maintained; intellectual goods get boring. The economy rolls along, and people continue to make investments to get a bigger share of it for themselves.
So economists aim for low but steady inflation. It benefits the economy as a whole, at a cost to those who want to accumulate cash and not spend or invest it.
tl,dr: Sitting on cash removes it from the economy, and deflation encourages people to spend money tomorrow rather than today.
In reality, people spend their money when they want or need something.
Today it's possible to hoard wealth in real estate/gold/stocks. The value of the pile is guaranteed to go up because of guaranteed inflation. Yet for some reason the economy doesn't grind to halt. By your explanation, everyone would just sit on that pile like a dragon and never buy anything.
Economists are perfectly happy with you buying stocks or real estate. That puts the money back in circulation, and funding something people use. They just don't want you sitting on cash.
The argument was that people wouldn't be consuming if their wealth keeps growing and everything gets cheaper all the time, and the economy would grind to a halt. It's the same thing with investments, and it isn't true. People can buy gold right now and sit on it until they die (in a few days), but they don't.
People spend whenever they need or want something, which is the fundamental force that keeps the economy running, regardless of what type of money or wealth they possess.
"Sitting on cash removes it from the economy, and deflation encourages people to spend money tomorrow rather than today. "
Since most people are in debt, this really says: encourage people to borrow to buy what they cannot afford today and then hope for inflation to make that borrowing less onerous.
Economists like debt. It gets the economy moving. A debt-less economy is very slow. Most non-trivial projects require debt: starting a business, buying a house, getting an education. If you had to pay for those in cash, you'd do so much later if ever.
It's the reason most corporations have debt. They use it to fund expansion. As long as that expansion brings in more money than the interest payments, they literally never have to pay that debt back.
Human beings, unlike corporations, retire. Inflation certainly puts a crimp in that, but there are many other problems with retirement with larger effects. Ultimately, those problems come down to an economy that continues to expand even after they've left the workforce, such that they can outpace inflation by either their own investments, or the government's.
Which, as I started with, is all about somebody taking out debts so that the economy expands. A vastly slower economy without debts is more straightforward to understand, but it's also a much more primitive and less productive one, and so everyone is worse off.
1) Wealthy + Paranoid + Stupid. They'd rather keep their money in sovereigns under their mattress, than put it into any sort of productive economic activity. On a long term, especially in the US, you could pretty much throw darts and build a portfolio that competes with, or beats, inflation.
2) Conspirational: "fiat currency is a grand scheme to undermine our savings for (insert nefarious bugaboo of the day)"
3) Arguably a subset of 2) but Apocalypse Enthusiast. "When civilization crumbles, the obvious trade unit won't be something like grain, alcohol, or bullets, but my bags full of low-grade silver dimes! I'll be King of the Wasteland!"
> fiat currency is a grand scheme to undermine our savings
How exactly is it not? Inflation = stealing value from people, that they have already created, time-limiting their spending power so that there's no way to actually save money in the long-term.
Money printing is theft,
indirect taxation without consent.
> Do you literally keep bills under your mattress or buried in your backyard? There's your problem.
No, there's not my problem. The problem is that the government keeps printing money, so my bills under my mattress or buried in my backyard keep dropping in value. The fact that there are securities that are literally called "Inflation-Protected" as an antidote to that only serves as a proof of the original problem.
> But you can save money!
No, you can invest money. But investing should not be mandatory just to keep your wealth from rotting.
> Yes, this is a feature: the discouragement of the non-productive uses of capital and hoarding à la Scrooge McDuck.
I sincerely doubt that "disouragement of the non-productive uses of capital" is the main reason for inflation. Linear tax on having money would do much better. Besides, except for a pathological example where scarcity of money causes deflation, why would it matter if someone is hoarding money?
If they're saving for something that costs e.g. 10 years wage, "hoarding" money is the only way they'd ever save that much. But with constant inflation, it's basically impossible - the only way to "save" money for something that expensive is to take a loan... Which again seems to lead back into banks' pockets. Who actually hoard money.
The game seems rigged, and all "explanations" for inflation just sound like bad lies given by Wall Street brokers high on coke.
The idea is that you'd save by investing into productive enterprises (and or government bonds) obviously that doesn't necessarily function as well as one would hope for but it's an better solution than hoarding cash/gold/bitcoin/etc.
I mean, I'm fucked. I've effectively lost between 10-20% of my purchasing power out of what ultimately equates to a relatively small sum in the first place because my time horizon was pretty small, I put a trust fund together for myself. Whole I was doing this bond yields were negative, and had been for a long while, and I'd posit they still are (last I looked the $1 pound loaves at Walmart were $1.50). I just did not and do not have the buffer money for investing, not to mention a need for liquidity and possible penalties. It would be nice to have something more stable. Of course, Au and Ag haven't yet reared their imaginary powers yet in any case, though many portend they will.
Ideally though, an ounce of gold is an ounce. But a dollar can be anything. The question is one of making gold, silver, or some other fixed-quantity, portable, arbitrarily valuable substance into legal tender, right?
Gold coins are beautiful liquid assets. Why not keep part of your retirement or emergency fund in gold and silver? I can just go down to one of many local coin stores and sell them if I need the cash.
> 3) Arguably a subset of 2) but Apocalypse Enthusiast. "When civilization crumbles, the obvious trade unit won't be something like grain, alcohol, or bullets, but my bags full of low-grade silver dimes! I'll be King of the Wasteland!"
Yes, direct trade may definitely be grains, alcohol or bullets - but as soon as economies more complex than a self sufficient farm village crop up, eventually some form of token will be required.
For that, historically gold and silver have been the established tokens of choice for millennia, and even today's currencies are backed by insane amounts of gold in central bank vaults - it's not a bad assumption per se to think that gold and silver will outlast even our modern civilization. Come to think of it, most of the world's currencies sans the Swiss Franc and the US dollars are barely decades old.
We're already seeing a switch from the US dollar as the universally accepted international reserve and trading currency - only 60% of reserves and 40% of trades are valued in dollars, mostly towards the Euro and, in smaller amounts, yen, yuan and a bit of Francs. Think forward a few decades... what humans create can vanish in a very short time.
The operative portion was the other half of the sentence.
It's never a "they're targeting a number that they believe in good faith will maximize economic activity on a national level", it's always "devaluing my existing holdings gives $boogeyman_ethnic_or_political_group an advantage" like you're somehow prohibited from investing.
So because someone has a different worldview, you're gonna call them stupid? Cool. In the meantime, look how much purchasing power your dollar has lost since 1971. In your first point, you're also only taking into account the government-reported inflation. Go to your local grocery store and run the numbers yourself and you'll get a much higher number. After a certain percentage, inflation just becomes a tax unless you have it sitting in assets.
And I don't understand your second point either. Your savings have most definitely been undermined. Your nominal wages might be up, but your purchasing power is way down since after the stimmys. To calculate the difference, compare how many hours you'd have to have worked in the past to how many hours you'd have to work now to achieve the same standard of living.
Maybe cut out the pretentiousness and dismissiveness and listen to what people who are generally concerned about you and your purchasing power are saying.
> whats practical about your wealth being stolen from you?
It forces you to invest it productive assets. What social value is there in locking away wealth in non-productive forms?
Buffett in 2011:
> Today the world’s gold stock is about 170,000 metric tons. If all of this gold were melded together, it would form a cube of about 68 feet per side. (Picture it fitting comfortably within a baseball infield.) At $1,750 per ounce – gold’s price as I write this – its value would be $9.6 trillion. Call this cube pile A.
> Let’s now create a pile B costing an equal amount. For that, we could buy all U.S. cropland (400 million acres with output of about $200 billion annually), plus 16 Exxon Mobils (the world’s most profitable company, one earning more than $40 billion annually). After these purchases, we would have about $1 trillion left over for walking-around money (no sense feeling strapped after this buying binge). Can you imagine an investor with $9.6 trillion selecting pile A over pile B?
> Beyond the staggering valuation given the existing stock of gold, current prices make today’s annual production of gold command about $160 billion. Buyers – whether jewelry and industrial users, frightened individuals, or speculators – must continually absorb this additional supply to merely maintain an equilibrium at present prices.
> A century from now the 400 million acres of farmland will have produced staggering amounts of corn, wheat, cotton, and other crops – and will continue to produce that valuable bounty, whatever the currency may be. Exxon Mobil will probably have delivered trillions of dollars in dividends to its owners and will also hold assets worth many more trillions (and, remember, you get 16 Exxons). The 170,000 tons of gold will be unchanged in size and still incapable of producing anything. You can fondle the cube, but it will not respond.
[0]https://en.wikipedia.org/wiki/E-gold