Any taxpayer who pays taxes owns a share in their government, very much like a stockholder does in the Federal Reserve and Treasury. Those who pay the most taxes own the most shares, and thus have more power and influence about how those taxes should be spent for the benefit of the whole.
In the fledgling Democracy that we have, we have gone through several cycles of severe boom and bust:
- one being the Stock Market Crash of 1929 http://en.wikipedia.org/wiki/Wall_Street_Crash_of_1929
- the Great Depression thereafter, http://en.wikipedia.org/wiki/Great_Depression with nothing seen like this since
- the Prolonged Recession http://en.wikipedia.org/wiki/Late-2000s_recession
These experiences have taught us many things about the value of money, particularly gold, and how America evolved into international relationships through a global economy of banks and E-commerce.
Many have professed profound anxiety over the global economy, sighting that the rich elite are controlling all of the money, but the power of the individual consumer determines by spending power if the rich maintain that status or if they fail in their money schemes and abusive lending practices. As such the success or futures of a stock depend not only on how much a business has made or how much it is worth, but depends upon the productivity and success of each individual employee working together in a large unified chain for that company, and whether or not the consumer buys the product consistently.
The same can be said about the size and scope of government, and its effectiveness or ineffectiveness.
With history being our greatest teacher, there are many things that the private citizen can do to master their own financial stability, to stabilize the waters that often get disturbed by commodities, mergers, and speculation.
The biggest problem we have seen with speculation is budgeting, financing, and speculation about economics in general:
1) Prolonged unemployment is a constant, not a variable that has changed to return us to a profit margin in business.
2) While the stock market numbers look good and business sectors are stayed for now, real recovery and growth has not occurred.
3) There is not a stable housing market because there is no stable job market.
4) The debt generated from speculation is very, very real.
I disagree with Ron Paul: just because the policy was bad and debts were made with money that ‘didn’t exist’ or wasn’t physically cut from other areas, doesn’t mean that ENDING THE FED and ripping up the notes solves the debt crises.
1) This would tank the stock market on uncertainty and would end bond surety.
2) This would ruin our relationships with other countries, and we would have to function without their trade.
3) This would put society back to a feudal system, rather than a federal system.
4) The damage from the debt would still exist with no way to repay the damage.
5) Unpaid debts often lead to even more predatory usury or end in violence.
A Spanish economist agrees speculation is the problem in economic policy and banking.
The Tea Party is anti-speculation and Obama is pro-speculation. Hence, the gold standard works as a regulator, but that does not mean it is to be used to promote the dispensing of credit without limit.
Gold surety from banks makes the banks function like any other business.
Holes in Ron Paul’s “END THE FED” Theory:
1) The Federal Reserve does not control gas prices, supply, or demand.
2) The Federal Reserve does not control the housing market, except for interest rates.
3) The Federal Reserve is not a Central Bank like Europe; their power is only strengthened or diminished by credit/value of gold.
4) Contrary to Ron Paul’s opinion, the Federal Reserve does not function or serve as the fuel for “The War Machine” since 1937; our relationships with other countries are far too complex and intertwined in a global economy to subscribe to an arbitrary view of one entity, in ascribing its power and equivalency of power to the Supreme Court.
5) When I see Greenspan, Bernanke, or Geithner, I don’t see men who are out to intimidate anyone: I see one brilliant mind on economics, a bungler, and a Euro-minded Keebler Elf.
6) I don’t believe that the Federal Reserve is a part of some grand conspiracy since 1913, or what is called the NWO: Bilderberg, with Soros being the man behind the curtain, like the Professor in “The Wizard of Oz”. While those are all convenient political images and analogies, that is simply not the designed function or actual outworking of the Federal Reserve.
7) Ron Paul mistakenly blames the Federal Reserve Act for every chaotic event since the 1900’s.
8) The Federal Reserve Act is not Socialism or Communism itself.
Reform is the answer, and in and of itself, it can be revolutionary. Risk still restricts the human elements of exploitation and integrity in the decision-making processes regarding money, that create a culture of lending discipline.
How to end speculation practices, maintain ethical regulatory practices to squelch predatory practices, and the role of the consumer:
1) When it comes to bank failures, all of one’s physical money being in the bank itself with no cash or gold on hand or in a safe is financial suicide.
2) Being convinced that putting all of one’s money into the bank, especially wages, when it should be used to pay bills on budget and then saved and spent both, is not earning ideal interest or being used to circulate economic growth, nor does it really serve the depositor, but the Bank itself.
3) Savings accounts and CD’s are good only for temporary growth; you get better yield from IRA’s and slow growth portfolios/diversified portfolios. Owning stock for the sake of owning it is money you could spend on purchases that save you money over time.
4) Planning ahead in case of drought, famine, or disaster by holding back ⅕ for every 7yrs. for emergency, works in financial principles as well as buying dry goods and so on.
5) When you put your wealth into the bank and do not buy assets or have revenue, or items for trade, then the bank devours the lives of people. Without property ownership, a business, or gold ownership and assets, you are destitute and penniless in a recession without a job.
13 Economic Principles that have nothing to do with the Federal Reserve:
1) regulation/laws increase cost
2) production costs
-related to fuel
-related to laws
-related to business/commodities
3) fuel costs
4) fines, fees, taxes
5) trade agreements devaluing the dollar
6) paper vs. hard money
7) borrowed money/interest/debt
8) poor economic conditions or market problems
9) currency exchange issues
10) product value worth, differing standards, and varying quality
11) money-making schemes/not gold-backed investing
12) corporatocracy, wealthy groups driving laws and policy to its benefit only
13) War
ALL OF THESE 13 PRINCIPLES ARE CONTROLLED, EFFECTED, AND CENTER AROUND THE ACTIVITIES OF CONGRESS... so it is not the Federal Reserve being a mighty arm to crush the people, it is the brain of Congress affecting the economy or disaffecting the economy.
On Banks:
-Bank failures are not like business failures.
-When we think about globalization, more businesses are connected than ever!
-Banks under the Federal Reserve Act are the same way.
What would have had a ripple effect if all the banks in one state failed would now cause a cascade of bank failures and businesses nationwide and worldwide.
Congress’ reliance on bank surety and general welfare is a double-edged sword, but we have to change that by not putting total confidence in government and banks to prevent exploitation and furtherance of incompetence! In short, reform begins with our own financial practices and work ethics.
Why stimulus usually does not work, why stimulus is not the only answer, and why stimulus should not be the first consideration in financial crises, as prevention by the consumer is the best medicine!
While I agree that there is a false boom that stimulus creates, those 13 economic principles have to be lowered, restricted, or even cease to exist for a society to be flourishing and prosperous; in order for businesses to hire, the housing market to be stabilized by those with income to buy homes and property with monthly spending income, for the economy to be growing at a stable and predictable rate.
The government by turning itself into a Mortgage Agency, Health Insurance company, among other businesses is too expended to do what it is supposed to do: govern.
The Federal Reserve and the Federal Reserve Act are not the problem: the size, scope, and governance of Congress and the government as a whole from the federal government to state agencies is the problem and root of our economic crises, past the role of the consumer, because the people are the government.
Ron Paul says that government meddling creates the black market for labor and goods, and that the tax code substantially contributes to the need for an underground economy. I could not agree more on that.
The black market increases as the legitimate taxpaying economy deteriorates: this leads to more deaths, poorer or manipulated goods, services, and drugs, and less revenue. Essentially, the government is directly responsible for its role to maintain a good business environment and economy to ensure revenue: when the government fails to do so, the government not only fails, but ultimately those who chose the failing leadership suffer doubly. The effect of poor governance then becomes exponential in its reach around the rest of the world.
WHAT IS THE SOLUTION?
Volcker says that the gold standard is the solution to the 2007 financial crises. Paul says that it is interest rates that break inflation.
While Ron Paul calls “the beast” the Federal Reserve, I call it the government in general, as the Federal Reserve is the beast whose fatal wound has healed. The worship of money, rather than the use of money to meet needs, is what leads to abuse and peril of society. The consumer and the government must guard against worshiping money as a religion, and not permit greed to win the day.
SOLUTIONS:
1) Gold standard (revisited with silver standard to back gold treasury values)
2) Interest rates that break inflation
3) Proper roles and restrictions by consumers and government alike, in ethical lending and fair trade, not based on race but actual credit practices and taxation
4) Gold-backed stocks to stabilize the stock market and exchanges between other countries
5) Gold-backed Treasury Bonds as suggested by Greenspan, not the IOU’s or selling debt to fund government operations, which are revenue funded operation. Gold Backed Treasury Bonds to stabilize Social Security until reform can be measuratively implemented that has already been proposed by repeal and replace legislation and elder tax credits in regard to containing insurance costs and debts.
6) Retire the dollar, go to dollar coins -- saves production costs, in not wearing down, prevents artificial printing of currency to manipulate the dollar by the FED
7) Write-off all public debts back to private debts, through the I.R.S/by TAX ID# for federal program dollars --- no buying up private debt for food, shelter, housing, or medicine/health services by the federal government and taxing the whole to pay for privately incurred debts.
8) Encourage world powers to do this to stabilize their stocks and exchanges, as the EURO and one-world currency aren’t viable solutions
SILVER STANDARD ISSUANCE, DOLLAR WORTH AS DEFINED BY SILVER TO GOLD TREASURY VALUE: silver has maintained consistent value by weight, without manipulation and holds the value close to the current EURO in silver
SILVER STANDARD ISSUANCE WEIGHT - $1 per full gram of silver
1oz. of silver = 28.35g or $28.35
issuance of a SILVER 28 mint
.5 oz of silver = 14.175g or $14.17
issuance of a SILVER 14 mint
.25 oz of silver = 7.0875g or $7.08
issuance of a SILVER 7 mint
.10 oz of silver = 2.835g or $2.83
issuance of SILVER 3 mint
Whether or not the Treasury intends to mint these coins, we may use these values to define the value of treasury gold, not by commodity market price but in conjunction to silver weight value and EURO market consistencies:
Gold by real weight, has possession value, but it does not have currency or commodity value, unless it is traded or used as substitute for dollar value. The Treasury is the same way with the dollar as the issued currency: when the dollar is backed by gold, and gold value is backed by weight of silver.
According to the scale above, the value of gold by standard silver issuance is:
1oz. of gold= 28.35g or $35
by issuance/backing of a SILVER 28 mint
.5 oz of gold = 14.175g or $17.50
by issuance/backing of a SILVER 14 mint
.25 oz of gold = 7.0875g or $8.75
by issuance/backing of a SILVER 7 mint
.10 oz of gold = 2.835g or $3.50
by issuance/backing of SILVER 3 mint
While those are implausible currency values for us to print in bills, the worth of our Treasury backed by the Silver Standard issuance and not commodity rates, means that our debts are paid to the Chinese and our deficit reversed. This is the economic reset button. We need to keep hitting this button repeatedly as businesses and with the way we conduct business in lending, fair trade, and extension of credit and payment in debts.
For the Chinese, they should understand profit margin value of our currency, in relation to the existing debt we have, so that they can understand why we are not purchasing certain goods:
What is $20:
Pays $15 toward our debt with them/PROFIT $5
What is $10:
Pays $7.50 toward our debt with them/PROFIT $2.50
What is $5:
Pays $3.50 toward our debt with them/PROFIT $1.25
What is $1
Pays $2.50 toward our debt with them/but there is not a profit but a loss on the dollar of -$1.50
With this model, the tax revenue lost when having to sell an item for $10 vs. $15 is immeasurable for small exchanges, and very damaging to state tax revenues. This prevents the state from borrowing from the federal government, and it also determines whether or not a person must pay federal income tax, for the federal government to see that revenue, in order to borrow without causing a deficit. Yes, it is that crucial !! Micro-economics and the power of the consumer have a powerful impact on the government in how they spend money or how they do not spend money.
To correct inflation of gold, in overvaluing as a commodity, in relation to the dollar value and Treasury holdings vs. debt, the current depreciation of the dollar must be accounted for by the silver standard equivalent to the Treasury standard equivalency of gold backed notes. In short, this dispels the practice of monopoly money.
According to the current holding of gold in 2004 of 261,007,000,000 oz. of gold, this places us out of total bankruptcy with a negative $15.7+ trillion deficit. If we settle this deficit with Treasury gold, we not only settle it with the Chinese by silver standard issuance in place, but we balance the budget deficit by correcting this currency issue through accounting by weight and consistent worth of metals backing currency.
The current value of the Treasury related to the debt leaves us $9,135,245,000,000. This amount means that the government by Treasury value is not bankrupt by measure of holdings present, but by improper government accounting, mismanagement, and trade/currency disparity issues. The government may only operate off of revenue received, and the trend has been $2.5 trillion annual revenue for operating costs. It is imperative until the economy improves and government does its job, that government borrowing to fund unconstitutional budget funding be denied and Obama held liable for misappropriation.
$9,135,245,000,000 in Treasury
$2,500,000,000,000 revenue
means we can not borrow more than 1/10 of what is in the Treasury
This does not include whatever gold was sold to pay for money borrowed for bailouts, but does not reflect the value of Troy weight, as it is not standard issue currency or minted into coins at this time.
The Troy weight is in variance, and therefore, the gold standard of the dollar must be regarded by silver standard issuance related to gold and debt: in areas of government finance in lending, borrowing, trading, and consideration of commodities only after a fair representation of the dollar value is made by standard issuance of silver weight to gold, and gold vs. debt, to equal fair market value of the dollar currency.
This will be the currency standard now for 2012, to define dollar value. This base is currency reform figures that will be used for the other legislation for ethical lending, fair trade, interest, and future repayment integrity, as Dodd-Frank failed and so did the Financial Reform legislation, in that people simply did what they should not and must not do, and must be prosecuted and held accountable.
This returns our country to good standing in the world, and it does not leave to the imagination of investors the state of the Treasury, the government, and the role of the consumer in strengthening the global economy with honesty as the best policy, not commodity inflation or speculation practices.
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