mellowtigger (![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png)
mellowtigger) wrote2009-10-09 10:40 am
mellowtigger) wrote2009-10-09 10:40 am
Entry tags:
money: told ya so
I suggested back in February that people endure this economic downturn by buying stuff (durable, useful stuff) because the value of dollars would deteriorate to useless levels. Money is supposed to be useful only as a trade medium. Money doesn't produce anything. Money is not wealth. "Stuff" is wealth. Herds of cattle are wealth. Factory buildings are wealth. Loyal employees are wealth. Farmland is wealth. Education and skill training are wealth. Hammers, axes, and shovels are wealth.
People succumbed to thinking that pieces of paper are wealth. Whether dollars or stocks or bonds, people thought that collecting them and trading them made them wealthy. I think of them all as merely baseball trading cards. They're sexy items to own only because other people think they're sexy. If they lose the luster of... well, lust... then of what use are these pieces of paper?
Paper money eventually returns to its intrinsic value ---- zero.
- Voltaire (1694-1778)
Today is a day of interesting news. We bomb the moon (I'm still waiting for data). Obama wins the Nobel Peace Prize (I think it's premature but an interesting experiment in encouragement). And the world begins moving away from the US Dollar. Wait, what?
According to an article at The Independent website, most of the world's energy-relevant nations appear ready to dump the US Dollar as the tool for valuing oil. My favorite take on this whole process is one of the comments at the Oil Drum article:
Paper currencies are ephemeral tokens clumsily applied to the true values (hard resources, ideas and actions) which really improve the human condition. Who cares if the dollar devalues to nothing or about any other paper currency? Everyone should know that paper currencies are transient hot potatoes - you never want to hold them over long periods of time or you will be burned. Paper monies have only momentary utility enabling more efficient transactions than barter. Paper monies will always have close to zero long term value. In order to facilitate their role as transactional tokens it is only important that paper currencies devalue to zero relatively slowly.
Like I said, buy stuff. Real stuff is wealth. Paper has been losing its usefulness for years.
I need to start taking pictures again. Photos of the empty railroad cars that are piling up again at the nearby railyard. Photos of the series of empty storefronts at local malls and shopping centers. One person I know (![[livejournal.com profile]](https://www.dreamwidth.org/img/external/lj-userinfo.gif)
foeclan) actually begins a new job in a few days. I know of many other people who are have gotten laid off in recent weeks and months. One person (mnteejay )received notice that in January his job will be cut to 8 hours per week. Seriously, just 8 hours.
While the US Dollar does still have value today, "the writing is on the wall" as the saying goes. I don't for one moment believe in the supposed signs of an economic turnaround. There are two problems happening right now. One is the exponential growth of debt that is required for our financial system to operate. The solution is to return to a currency with a fixed real-world value, like a gold standard that the Middle East is creating now. The other problem is energy. Our economy requires vast quantities of energy, and I see no reliable source of such energy available today.
I think this will be the perpetual recession; I believe that it will continue until either the oil finally runs out (and we crash) or we get nuclear fusion to work (which allows us to continue using the boneheaded exponential growth model). My hope is that we see the creation of actual, sustainable economies and finances. That would be fun. But too many people still subscribe to the old thinking, so we'll have to wait for either the oil or the fusion to happen instead.
People succumbed to thinking that pieces of paper are wealth. Whether dollars or stocks or bonds, people thought that collecting them and trading them made them wealthy. I think of them all as merely baseball trading cards. They're sexy items to own only because other people think they're sexy. If they lose the luster of... well, lust... then of what use are these pieces of paper?
Paper money eventually returns to its intrinsic value ---- zero.
- Voltaire (1694-1778)
Today is a day of interesting news. We bomb the moon (I'm still waiting for data). Obama wins the Nobel Peace Prize (I think it's premature but an interesting experiment in encouragement). And the world begins moving away from the US Dollar. Wait, what?
According to an article at The Independent website, most of the world's energy-relevant nations appear ready to dump the US Dollar as the tool for valuing oil. My favorite take on this whole process is one of the comments at the Oil Drum article:
Paper currencies are ephemeral tokens clumsily applied to the true values (hard resources, ideas and actions) which really improve the human condition. Who cares if the dollar devalues to nothing or about any other paper currency? Everyone should know that paper currencies are transient hot potatoes - you never want to hold them over long periods of time or you will be burned. Paper monies have only momentary utility enabling more efficient transactions than barter. Paper monies will always have close to zero long term value. In order to facilitate their role as transactional tokens it is only important that paper currencies devalue to zero relatively slowly.
Like I said, buy stuff. Real stuff is wealth. Paper has been losing its usefulness for years.
I need to start taking pictures again. Photos of the empty railroad cars that are piling up again at the nearby railyard. Photos of the series of empty storefronts at local malls and shopping centers. One person I know (
foeclan) actually begins a new job in a few days. I know of many other people who are have gotten laid off in recent weeks and months. One person (mnteejay )received notice that in January his job will be cut to 8 hours per week. Seriously, just 8 hours.While the US Dollar does still have value today, "the writing is on the wall" as the saying goes. I don't for one moment believe in the supposed signs of an economic turnaround. There are two problems happening right now. One is the exponential growth of debt that is required for our financial system to operate. The solution is to return to a currency with a fixed real-world value, like a gold standard that the Middle East is creating now. The other problem is energy. Our economy requires vast quantities of energy, and I see no reliable source of such energy available today.
I think this will be the perpetual recession; I believe that it will continue until either the oil finally runs out (and we crash) or we get nuclear fusion to work (which allows us to continue using the boneheaded exponential growth model). My hope is that we see the creation of actual, sustainable economies and finances. That would be fun. But too many people still subscribe to the old thinking, so we'll have to wait for either the oil or the fusion to happen instead.
no subject
no subject
Coincidentally, at the hotel where Gaylaxicon and another conference are being held, there's also a small business promoting some kind of "earn money with Gold" event in one of the rooms there. They're probably trying to fleece people of their gold before its value increases (see: gold standard currency).
(edit: the word is now "increases" instead of "skyrockets" because the baseball trading card effect won't actually skyrocket the price of gold)