Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

Fiat Paper Money [Ron Paul]
Lew Rockwell ^ | 9/12/03 | Ron Paul

Posted on 09/12/2003 2:00:29 AM PDT by Chancellor Palpatine

In an article entitled "Gold and Economic Freedom," Federal Reserve Chairman Alan Greenspan wrote that "The excess credit which the Fed pumped into the economy spilled over into the stock market- triggering a fantastic speculative boom...The speculative imbalances had become overwhelming and unmanageable by the Fed... In the absence of the gold standard, there is no way to protect savings from confiscation through inflation." The irony is that Mr. Greenspan's words, written in 1966 to describe the era leading up to the Great Depression, could easily have been written in 2003 to describe the consequences of his own Fed policies during the 1990s.

Mr. Greenspan once understood that a fiat money system represents nothing more than a sinister and evil form of hidden taxation. When the government can print money at will, it's morally identical to the counterfeiter who illegally prints currency. Fiat money polices especially hurt savers and those on fixed incomes, who find the value of their dollars steadily eroded by the Fed's printing presses.

We need to understand why a fiat system is so popular with economists, the business community, bankers, and government officials. One explanation is that a fiat monetary system allows power and influence to fall into the hands of those who control the creation of new money, and to those who get to use the money or credit early in its circulation. The insidious and eventual cost falls on unidentified victims, who are usually oblivious to the cause of their plight.

Another explanation is that it's human nature to seek the comforts of wealth with the least amount of effort. This desire is quite positive when it inspires efficient work and innovation in a capitalist society. Productivity is improved and the standard of living goes up for everyone. But this human trait of seeking wealth and comfort with the least amount of effort is often abused. It leads some to believe that by certain monetary manipulations, wealth can be increased out of thin air.

Most Americans are oblivious to the entire issue of monetary policy. We all deal with the consequences of our fiat money system, however. Every dollar created dilutes the value of existing dollars in circulation. Those individuals who worked hard, paid their taxes, and saved some money for a rainy day are hit the hardest. Their dollars depreciate in value while earning interest that is kept artificially low by the Federal Reserve easy-credit policy. The poor and those dependent on fixed incomes can't keep up with the rising cost of living.

We do hear some minor criticism directed toward the Federal Reserve, but the validity of the fiat system is never challenged. Both political parties want the Fed to print more money, either to support social spending or military adventurism. Politicians want the printing presses to run faster and create more credit, so that the economy will be healed like magic – or so they believe.

Fiat dollars allow us to live beyond our means, but only for so long. History shows that when the destruction of monetary value becomes rampant, nearly everyone suffers and the economic and political structure becomes unstable. Spendthrift politicians may love a system that generates more and more money for their special interest projects, but the rest of us have good reason to be concerned about our monetary system and the future value of our dollars.


TOPICS: Business/Economy; Constitution/Conservatism; Philosophy; Political Humor/Cartoons
KEYWORDS: conspiracytheory; fed; federalreserve; fiatmoney; goldbug; heehaw; humor; illuminati; kookoococopuffs; ronpaul
Navigation: use the links below to view more comments.
first 1-2021-36 next last
HeeHaw was only supposed to be a skit based show - not the basis of a political and economic ideology.

He went off the rails some time ago, and is now into the tin-foil hatted silliness of fiat money theory, and it is past time that the voters of his district recognize him for what he is - a nut.

1 posted on 09/12/2003 2:00:30 AM PDT by Chancellor Palpatine
[ Post Reply | Private Reply | View Replies]

To: sinkspur; dighton; general_re; Poohbah; Catspaw; wimpycat; BlueLancer; Texas_Dawg; LanPB01; ...
Ping (and yes, I know what time it is - insomnia can be annoying....
2 posted on 09/12/2003 2:03:13 AM PDT by Chancellor Palpatine (Is George W. Bush a Bushbot?)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Chancellor Palpatine
I couldn't agree more. That Alan Greenspan and the rest of those traitors are just plain kooks!

Seriously, I'm afraid that history has/will prove Ron Paul to be one of the few who is clear-headed. The only thing that preserves the value of a buck today is the fact that those with money to donate to political campaigns want to preserve the value of their bank accounts.

3 posted on 09/12/2003 2:37:34 AM PDT by The Duke
[ Post Reply | Private Reply | To 1 | View Replies]

To: Chancellor Palpatine
There was a thread a few days ago where someone Paul had apparently slandered wrote a rebuttal to all his accusations. I wasn't really familiar with either of them, nor do I know what they were talking about, but the posts afterwards made for a good read.
4 posted on 09/12/2003 3:36:36 AM PDT by LanPB01
[ Post Reply | Private Reply | To 2 | View Replies]

To: LanPB01
The paulbots are by and large the <1% loonies, and that always makes for fun reading.
5 posted on 09/12/2003 4:24:25 AM PDT by Chancellor Palpatine
[ Post Reply | Private Reply | To 4 | View Replies]

To: The Duke; habs4ever; Poohbah
The guy marches to the beat of himself. His problem (aside from the fact that he is a major windbag with delusions of mental adequacy) is that he and his sycophants are prone to preach to the >99% of the people who disagree with him in a manner which is arrogant and grating.
6 posted on 09/12/2003 4:27:37 AM PDT by Chancellor Palpatine
[ Post Reply | Private Reply | To 3 | View Replies]

To: The Duke
The only thing that preserves the value of a buck today is the fact that those with money to donate to political campaigns want to preserve the value of their bank accounts.

Didn't we used to run our credit card donations to FR through your service?

7 posted on 09/12/2003 5:05:11 AM PDT by ArneFufkin
[ Post Reply | Private Reply | To 3 | View Replies]

To: Chancellor Palpatine
The RonPaulNots can't even figure out the difference between cause and effect, but it's typical of them.They have a POV that needs stroking by an ill informed mental midget who loves to use hot button words like "bubble" as a cover for his own ignorance.These guys honestly believe the world is zero sum, so when RonPaulNot speaks, does that mean he's depriving someone else of their rightful oxygen?

Spare us all from the economic wisdom of a vet who decided to become a somebody who could bore thousands to death on the floor of the House, instead of doing in the local diner, where his type of gasbag belongs.

Ron Paul is an idiot.
8 posted on 09/12/2003 5:14:42 AM PDT by habs4ever
[ Post Reply | Private Reply | To 6 | View Replies]

To: ArneFufkin
Oh no, not Sad SadJoe?? Left to wander the beaches of SoCal, pining for the days of unfluoridated water, when conservatives were real conservatives, and Jack D. Ripper would have made a great POTUS....
9 posted on 09/12/2003 5:17:57 AM PDT by habs4ever
[ Post Reply | Private Reply | To 7 | View Replies]

To: habs4ever
I mean before Old Uncle Joe, who's moving real slow ... I think my original credit card stuff went through "The Duke". He was doing it as a favor for Jim. But still, someone who has a credit car merchant account yakking this nonsense?

This place is becoming "Twin Peaks."

10 posted on 09/12/2003 5:21:16 AM PDT by ArneFufkin
[ Post Reply | Private Reply | To 9 | View Replies]

To: Chancellor Palpatine
It's easy to label someone if they use the buzz-words. Fiat money. Black helicopters. The Council for Foreign Relations.

Yet, if you reject Ron Paul because he has unwisely chosen to use a buzz phrase, you risk missing his salient points. He's right -- Greenspan did pump too much credit into the American economy in the mid/late 90's. The result was a speculative stock market bubble.

And we are living the results of that bubble today -- a long, drawn out recession. Even if Capitol Hill are cooking the books to say it's over, it is only very recently coming to a close -- and we stand a risk of double-dip if the jobs don't come back SOON.

So, mock if you want, but remember: Ron Paul is not dumb. He's on-track about a lot of issues.

I remember mocking Ross Perot. But it turns out his "giant sucking sound" actually happened. We really DID lose a ton of jobs, and a lot of it is directly attributable to NAFTA and GATT. Mea culpa, for mocking him at the time.

11 posted on 09/12/2003 5:26:22 AM PDT by Lazamataz (I am the extended middle finger in the fist of life.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Lazamataz
Crap.

We had a monetary deflation from late 1996 to Oct 2002...it wasn't too much credit, it was an absence of credit, that wreaked havoc.Try and get it right, will ya?
12 posted on 09/12/2003 5:42:32 AM PDT by habs4ever
[ Post Reply | Private Reply | To 11 | View Replies]

To: Lazamataz
Laz, let's be honest. There are lot of IT professionals, especially systems engineers and programmers, who have been drawn to FR. There's an upheaval in THAT labor market right now, and that is fueling a lot of the angst HERE. That, and Brigadier con-men working systems of F.U.D.

Because you, and other Freepers, are personally affected by this dislocation, you project that onto the broader populace. People are uncertain because they're getting doom and gloom scenarios jammed their throats by the leftists. Americans are UNEMPLOYED! Nobody they know, but there's got to be lots of them somewhere, because they keep hearing about it. Yet, their 401Ks are building strong again. They've got huge valuation gains in their houses. Life is good. People ARE working, unemployment is 6%. Sorry, Laz, there were a lot of Systems guys in the late 90s who were GROSSLY overpaid. That's working itself out now, companies cannot afford that premium post-dotcom frenzy.

That's the great whine and cry here. It's Carolinians who want to make athletic supporters and washcloths at Union wage and mediocre IT techs and software guys who want to make $85,000/year like they did in '99 without offering a competitive ROI to their employers. Those days are gone. Forever.

13 posted on 09/12/2003 5:43:03 AM PDT by ArneFufkin
[ Post Reply | Private Reply | To 11 | View Replies]

To: ArneFufkin
Your observations are not without merit. I hadn't considered the possibility that software guys are overrepresented at FR, but you are probably right.

However, I think I do take issue with your implied premise that a good software guy isn't worth 85k or so. We've spent YEARS in school and YEARS refining our technique. We can save companies lots, in terms of implementing systems that increase efficiency and make ordering/satisfaction more fluid and cost-effective. Even reports can save a company a lot, since that can tell the execs much about the health of the firm.

The rest of your post seems pretty accurate, however. But remember the old adage: "A recession is when the other guy loses his job. A depression is when you lose yours."

14 posted on 09/12/2003 5:52:04 AM PDT by Lazamataz (I am the extended middle finger in the fist of life.)
[ Post Reply | Private Reply | To 13 | View Replies]

To: Chancellor Palpatine
Fiat dollars allow us to live beyond our means, but only for so long. History shows that when the destruction of monetary value becomes rampant, nearly everyone suffers and the economic and political structure becomes unstable. Spendthrift politicians may love a system that generates more and more money for their special interest projects, but the rest of us have good reason to be concerned about our monetary system and the future value of our dollars.

It is now time to pay the piper for Greenspan's misguided and politically motivated monetary policy. The illusion of prosperity and economic growth is based on ever increasing and expanding debt. It cannot be sustained. Fiat currency always fails because corrupted political leaders never ever can show discipline in spending.

Richard W.

15 posted on 09/12/2003 5:59:59 AM PDT by arete (Greenspan is a ruling class elitist and closet socialist who is destroying the economy)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Lazamataz
I meant no disrespect, I don't know how to manage a network or design a software interface to anything. The problem is ... there are TOO many people who do! Including guys in third world countries.

When any market offering becomes commoditized, it becomes a competition of low cost providers. That's what is happening at some levels of network management, system engineering, call center operations and software design. It's laying roof shingles and pounding nails. We can't play that game, not in the environment of taxation, regulation and welfare our businesses and workers are burdened with. We can change that. The nature and value of the tasks themselves, however, can't be changed.

The guys who have the training and experience here need to be working to maximize their professional skills toward innovation - there they can demonstrate value directly to the bottom line of a company P&L. Do that, you can name your price.

It's about taking the fundamental skills and crafting creative, innovative and niche expertise. Something Sanjay can't replicate over in Bangaladore.

16 posted on 09/12/2003 6:15:13 AM PDT by ArneFufkin
[ Post Reply | Private Reply | To 14 | View Replies]

To: ArneFufkin
The guys who have the training and experience here need to be working to maximize their professional skills toward innovation - there they can demonstrate value directly to the bottom line of a company P&L. Do that, you can name your price.

Do you have any idea how to do that? I'm at a loss.

17 posted on 09/12/2003 6:16:59 AM PDT by Lazamataz (I am the extended middle finger in the fist of life.)
[ Post Reply | Private Reply | To 16 | View Replies]

To: Chancellor Palpatine
Ron Paul is closer to the truth than any of Alan Redspans people. Fiat money is the death of an Empire. Never has an empire been defeated militarily, it has ALWAYS been by their own demise.

Ron's web page http://www.house.gov/paul/tst/welcome.htm

The man understands the world of currency and debt

18 posted on 09/12/2003 6:28:00 AM PDT by LandofLincoln
[ Post Reply | Private Reply | To 5 | View Replies]

To: arete
You are speaking to a deaf and bland man. (sic).
19 posted on 09/12/2003 6:31:02 AM PDT by bvw
[ Post Reply | Private Reply | To 15 | View Replies]

To: bvw
You are speaking to a deaf and bland man. (sic).

Yeah, I know, but I keep hoping that if just one or two open their eyes and see what is happening, it will be worth the effort.

Richard W.

20 posted on 09/12/2003 6:38:33 AM PDT by arete (Greenspan is a ruling class elitist and closet socialist who is destroying the economy)
[ Post Reply | Private Reply | To 19 | View Replies]


Navigation: use the links below to view more comments.
first 1-2021-36 next last

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson