ttpmvo (November 30, 1999 at 12:00 am)

money is not backed by anything thing its legal tendertherefore its worthless paper the goverment keeps making to control the publicend of story

LUEcifer (November 30, 1999 at 12:00 am)

You're basically telling me what I've been saying all along. Of course commodity backed currency experiences periods of inflation/deflation, but the value can fluctuate in either direction. The trust system we have now will ALWAYS devalue our dollar. 700 billion dollar bailout anyone?

origen01 (November 30, 1999 at 12:00 am)

Inflation is caused simply by an increase in money supply. A commodity backed currency is not exempt as it is also subject to increases in supply (e.g. Gold Rushes). They do indeed protect against govt. overspending and hyperinflation--but as I brought up in a an earlier post economies frequently face deflationary periods when the supply of the commodity dries up.

origen01 (November 30, 1999 at 12:00 am)

God. you really took me to school on the "overvalue"/"overpriced" statement i made. i apologize for such a foolish statement. i wish youtube had a delete button for comments sometimes cause this really makes me look bad.

LUEcifer (November 30, 1999 at 12:00 am)

True, but using a currency that is backed by a tangible substance can be used. I was using the bartering example to show you that not all economic systems experience inflation.

LUEcifer (November 30, 1999 at 12:00 am)

If that were the case then how come you are avoiding the example I used of Soviet Russia? A loaf of bread is a loaf of bread is a loaf of bread, etc. The value of the good wasn't overpriced during that period, the money was just worthless. How can you be so blind to what's really happening to the US dollar?

origen01 (November 30, 1999 at 12:00 am)

like i said, bartering cannot be used by the nation-state economies.

origen01 (November 30, 1999 at 12:00 am)

goods and services are overpriced in an inflationary period. its the hallmark characterization of inflation. just look at the CPI

LUEcifer (November 30, 1999 at 12:00 am)

Bartering is the oldest form of "currency" in the world. It's pure supply and demand."I need bananas, but I have goats. My neighbor needs goat milk and has bananas. Let's trade." There's no complicated as all hell departments that regulate everything, the consumer controls the value. Our current currency system is a trust system, all of which that have ever been implemented throughout history have failed. Currency needs to be redeemable for tangible wealth, not empty words.

LUEcifer (November 30, 1999 at 12:00 am)

Goods and services will ALWAYS be needed. The demand for these will remain fairly constant. People will always need to eat, have shelter, fuel their vehicles, etc. That's not overvalue, thats currency LOSING value. Are you daft?If goods and services are the thing that gets inflated, how the hell do you explain people in soviet russia needing wheelbarrows of currency for a loaf of bread during the collapse of the soviet union? Is Russian bread worth more than any other bread?