Spotting fake hundos

[OnYourBike]

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When a bank loans money, that money is paid back to them. So no money is being created out of thin air.

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Uh....no. US Currency is not backed by any tangible items such as gold (which is really just a hunk of metal with a specific elemental number that humans assigned an arbitrary value to based on its relative scarcity and its ability to exist in a solid and liquid form without losing much mass between transformations). No bank or reserve has actual cash, collateral or metal anywheres near the actual value of their outstanding loans.

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The dollar is backed by the stabilty and strength of the United States of America and the faith people have in it. Sure it has value because we choose believe it does, but that's no different to people putting faith in gold holding it's value. Gold has value because we convince ourselves it has.

[Rottersod]

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When a bank loans money, that money is paid back to them. So no money is being created out of thin air.

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Uh....no. US Currency is not backed by any tangible items such as gold (which is really just a hunk of metal with a specific elemental number that humans assigned an arbitrary value to based on its relative scarcity and its ability to exist in a solid and liquid form without losing much mass between transformations). No bank or reserve has actual cash, collateral or metal anywheres near the actual value of their outstanding loans.

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The dollar is backed by the stabilty and strength of the United States of America and the faith people have in it. Sure it has value because we choose believe it does, but that's no different to people putting faith in gold holding it's value. Gold has value because we convince ourselves it has.

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Didn't I just write that in the post you are quoting? I wrote that the dollar is not backed by and tangible items. Faith is not tangible.

[SNOWBALL]

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Didn't I just write that in the post you are quoting? I wrote that the dollar is not backed by and tangible items. Faith is not tangible.


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the dollar is backed by the commidities it trades for, just like gold is backed by the commodities it trades for or the dollars it trades for. Nothing has intrinsic value. Stop getting your econ lessons from 2am infomercials and AC crackpots/gunhoarders.

[pfapfap]

All I know is that when it comes tumbling down (signs of it this week, but I don't think we're there yet... but most certainly within my lifetime), I hope I'm savvy enough to see it coming far enough in advance to trade all of my ink-covered cotton for canned foods and shotgun shells.

Also, I'm tickled that my little one-off generated such a discussion. I figure poker players more than your average person understand the fantasy of money.

[BigBluffer]

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All I know is that when it comes tubmling down (signs of it this week, but I don't think we're there yet... but most certainly within my lifetime), I hope I'm savvy enough to see it coming far enough in advance to trade all of my ink-covered cotton for canned foods and shotgun shells.

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Sounds like all that stuff you hoarded for the Y2K end-of-the-world apacolypse will finally come in handy. [img]/images/graemlins/smile.gif[/img]

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Name me an empire that hasn't fallen.

[BigBluffer]

Ahhhh .... using that line of reasoning, I agree with you 100%. I just hope I'm out of town when it happens. [img]/images/graemlins/smile.gif[/img]

[Rottersod]

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Didn't I just write that in the post you are quoting? I wrote that the dollar is not backed by and tangible items. Faith is not tangible.


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the dollar is backed by the commidities it trades for, just like gold is backed by the commodities it trades for or the dollars it trades for. Nothing has intrinsic value. Stop getting your econ lessons from 2am infomercials and AC crackpots/gunhoarders.

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That is a circular argument. You must have failed your econ 101 class.

[Mr Rick]

I'm pretty sure that the dollar is worth what everybody else is willing to pay for it. And that depends to some extent on the amount of dollars in circulation at a given time among other things. The other things being how well the economy of the US is doing.

I got a C in Econ 101 because I thought everything could ultimatley be explained by the Irish Potato Famine in the 1800's. In this case, without the ability to produce potatoes the US would not get good value on the dollar. Especially from Ireland.

[Rottersod]

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I got a C in Econ 101 because I thought everything could ultimatley be explained by the Irish Potato Famine in the 1800's. In this case, without the ability to produce potatoes the US would not get good value on the dollar. Especially from Ireland.

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But in early 1900's the mass produced potato was introduced and factory workers from all over flocked to Boston to work in the potato factories, which at their height could assemble 250,000 potatoes a day. 90% of the workforce were Irish and they got paid so little that the phrase "they worked for potato's" came into popular use.