I ranted: >> IMHO, too many politicians are focusing on a misguided
>> belief that balancing the national budget is the most >> important thing, above everything else, that must be >> tackled. What most fail to realize is the fact that >> "money" is nothing more than a contractual >> representation of the exchange of goods and services >> between individuals and legal entities. Ed replied: > No Steven, what you say is not the issue. The issue is > that money has been lent to the US in various forms and > by various people and they want their money back > eventually. Meanwhile they want to be paid interest. The > US is rapidly approaching a level of debt such that if the > interest rates rose to normal levels, we could not pay the > interest without shutting down significant parts of the > government. The US is presently printing dollars to cover > this expense. As a result, the debt is growing because > this money is borrowed from the Federal Reserve, which is > a private bank owned by individuals who want to be paid. > At some point in the near future, the debt will be so > large, it simply can not be paid. At that point, the US is > in default, and the financial system of the world > collapses. This means starvation and civil strife. The > problem is serous and can not be solved without great pain, > which means further loss of jobs. The fools in Congress > over the last 20 years have created a no win situation > that very few people understand. I'm 100% in agreement with your debt analysis, Ed. I suspect we are probably discussing the same issue, but from slightly different angles. And perhaps with slightly different objective as well. As we all know the nation is getting more and more in debt. However, as Jed points out in a follow-up post, I also suspect this debt crisis is a contrivance with a specific objective in mind. That objective being that those with the most amount of money now stand to end up making even more money in the future! This obviously can't continue. Such a scam will eventually break system. For me, this gets back to my prior comment that money is nothing more than a contractual representation of the exchange of goods and services between parties. The only thing that gives value to money is the generation of goods and services the piece of paper attempts to represent at the precise moment of the exchange. It's not due to the fact that we have printed up a fixed amount of money that others then, through hard work, try to accumulate - as if money itself has some mysterious kind of intrinsic magical value in itself. Massive debt on the national level can only be created as a result of keeping the amount of money that can ever be allowed in circulation maintained at a fixed aggregate amount. There are those in power who want to keep everyone worshipping the notion that the total amount of aggregate money in the system must remain a FIXED amount. And they are ...duh... those with the most amount of money languishing about in their vaults. Under this convenient arrangement the temporary illusion of extra cash that suddenly flows into the macroeconomic system can only be generated by those who have more money than they know what to do with who, in turn, generously LEND it back into the system. And we all know what happens when it's finally time to pay the piper. The rich end up with an even bigger slice of the entire pie while everyone else ends up with less. This simply can't continue. Some archetypical form of a Robin Hood scenario will eventually force itself upon the political area as the only means left to help balance the books in a more equitable manner. IMHO, the only means left to a nation rapidly growing its debt load would be to start printing up more money - money which will not be paid for through issuing more bonds. Printing up more "unaccountable" money would be the only means left to a nation as a means to better redistribute slices of the pie. If we don't, I think we will ironically sow the seeds of where the intrinsic value of money will become devalued, if not seriously damaged. This will happen because more and more of the work force will be forced out of business and into employment. When that happens there will be fewer and fewer goods and services being generated for which money... ANY MONEY still circulating in the system could be used to purchase them. IMHO, if we end up enduring a scenario where there are far fewer goods and services being generated, it is not wise to assume that offering up gold coins as payment will be any more advantageous than offering up the equivalent amount in the form of paper bills. For one thing, only a tiny number of individuals will profit under a scenario of amassing gold with the expectation they will later use it to buy all the goods and services they need. As we all know there is only so much gold to go around on the planet. It would not be wise to assume that they will be able to better insulate themselves from what will be happening to the rest of the world that has no gold of their own to trade. We're all in this together. OTOH, the amount of goods and services that can be generated is limited only by the size of an able workforce and their willingness and ability to create goods and services. That's where the real gold lies, and that's what all nations should bank on and "pay" for. Regards, Steven Vincent Johnson www.OrionWorks.com www.zazzle.com/orionworks tech.groups.yahoo.com/group/newvortex/
