Supernotes: A New Generation of Counterfeit Money

Las Vegas Now ^ | Nov 3, 2006 | George Knapp

[Dosa26]

On the green seal on the righthand side of the face the star with the printed denomanation the black and green pixilate where they overlap on a copier

You know the area I'm talking about right? On what I refer to as class E counters I can see the pixalation from arms length. The class A's I have to hold the bill 5 inches from my eye. I have a one dollar bill I save because it is "probably" real...just as a keepsake.

[piasa]

We could establish the standard as whatever we want. We clearly can't do $20 an oz.

Just slapping whopping big values on gold and silver would make all our electronic equipment pretty darn expensive, seeing as how we use things like gold and silver to make these products.

Perhaps we should just go back to the ancient cocao bean monetary system.

[UnbelievingScumOnTheOtherSide]

probably more counterfeit US currency is circulating, in larger denominations, than genuine currency within the US. This may be enough to affect our rate of exchange negatively on a worldwide basis.

Not really. Even though 60% of all US currency ($300B) circulates outside the US, it is dwarfed by foreign exchange held electronically and in other securities, like Treasury Bonds ($1.5T alone).

[Dosa26]

Perhaps we should just go back to the ancient cocao bean monetary system.

Nah...It'll just be chips for everyone. All electronic. First with the criminals then with the welfare, finally with everyone else. It's the only way since people refuse to look closely at currency.

[Yo-Yo]

So what do you wish to do, start a new gold standard where one dollar is 1/3000^th of an ounce? Then when we need more money to support a population of 350 million people, we make a dollar 1/4000^th of an ounce?

The whole point of the $35 an ounce gold standard was that the amount of gold that a dollar represented never floated, it was always fixed over time, and the paper note was always redeemable for real gold.

The reason we're off the gold standard was during the Depression FDR made it illegal for US Citizens to own gold, other than jewelery. He stopped the minting of gold coins, and ended the private redemption of paper notes for gold or silver.

We still maintained the $35 an ounce gold exchange with foreign governments, but in the early 70's there was a run on our gold reserves by Great Britian and others who wanted to exchange their dollars for gold. There simply wasn't enough gold in Fort Knox to cover all the foreign held notes, so Nixon ended the foreign exchange of gold, putting us on a fiat currency.

If the amount of gold that a dollar represented were allowed to float, and were not convertable in the manner you assume, the dollar remains a fiat currency and the "gold standard" as you describe would be a myth.

[Jack Black]

Sorry you misunderstood my suggestion. Actually a "floating gold standard" exists to some extent because the abilty to buy , hold and sell gold is again allowed in the USA. And there are multiple electronic gold exchanges for electronic digital gold, like e-Gold.

My suggestion was simply to point out that there *IS* enough gold to go back on the gold standard, it's just a matter of picking the fix. I would not advocate allowing it to float, once it was set. That as you point out doesn't accomplish the goal.

[Yo-Yo]

In theory, a single ounce of gold is enough to establish a "gold standard" currency.

What you would propose is that once the amount of gold behind each dollar is fixed, it must forever remain so. So in the future as our economy expands, we would have to either acquire more hard gold from other sources, or not grow the money supply, which is a sure-fire recipe for disaster.

Since the rest of the world would not be on the same gold standard, if the price of gold went up, foreign governments and individuals could present paper dollars to our treasury for redemption in gold. We would either have to take even more dollars out of circulation, or else find more gold from somewhere else. (If you couldn't redeem paper notes for gold upon demand, then the whole concept of a "gold standard" becomes a sham.)

There is not a single major currency in the world that isn't a fiat currency. Returning to a gold standard for the United States is a sure fire recipe to destroy not only our own economy, but send the entire world into another depression that would make 1929 look like a good year.