Currency without a US Central Bank

Discussion in 'Economy' started by CrusaderFrank, Jul 17, 2010.

  1. CrusaderFrank
    Offline

    CrusaderFrank Diamond Member

    Joined:
    May 20, 2009
    Messages:
    81,265
    Thanks Received:
    14,919
    Trophy Points:
    2,210
    Ratings:
    +37,068
    In another thread it was brought up that one of the benefits of having a Federal Reserve is that the US Dollar became the worlds reserve currency. While the idea has some merit that I don't want to debate here, consider the possibility of currency without a US Central bank.

    We keep forgetting that US States are as large, well populated and generate as much economic activity as entire European nations. CA would be one of the world's largest (Failing Socialist) economies.

    So, if there were no Federal Reserve how would it work?

    Each state could issue currency the same way Germans issued Marcs, the Swiss Francs and the British pounds. The state would initially try to set a value for the currency backed by the taxing power from commodity or commodities produced in the state: gold, CDMA chips, wheat, etc.

    The value would ultimately be set commodity exchanges on a daily basis where people hedge risks and speculators take their chances on the markets.

    While the US Dollar would no longer be the world reserve currency, so what?
     
    Last edited: Jul 17, 2010
  2. Paulie
    Offline

    Paulie Platinum Member

    Joined:
    May 19, 2007
    Messages:
    31,577
    Thanks Received:
    4,856
    Trophy Points:
    1,130
    Ratings:
    +15,424
    You won't find many on here who agree with this more than I do, but globalization has ruined this for ever happening.
     
  3. Douger
    Offline

    Douger BANNED

    Joined:
    Jun 25, 2009
    Messages:
    12,323
    Thanks Received:
    915
    Trophy Points:
    0
    Location:
    Not fucking there !
    Ratings:
    +915
    You'll have your answer soon enough.
    Nobody will " loan" you any money.......AKA buy your junk bonds.
    Your govt will collapse and you'll have total anarchy.
    Go do some research on Argentina's collapse and plan accordingly.
    Keep in mind you live in the most heavily armed nation on earth, full of psychotic, drugged up,radical assholes, so multiply Argentina's scenario by 1000
     
  4. Oddball
    Offline

    Oddball BANNED Supporting Member

    Joined:
    Jan 3, 2009
    Messages:
    41,428
    Thanks Received:
    8,397
    Trophy Points:
    0
    Location:
    Drinking wine, eating cheese, catching rays
    Ratings:
    +8,409
    Since all the currency would be redeemable for specie, per Article 1, Section 10, it wouldn't matter if each state issued currency, or even if a private bank issued its own commercial script.

    One thing's for certain, though...The feds couldn't just try to print their way out of the fiscal craters they've dug.
     
  5. william the wie
    Offline

    william the wie Gold Member

    Joined:
    Nov 18, 2009
    Messages:
    7,302
    Thanks Received:
    676
    Trophy Points:
    175
    Ratings:
    +1,618
    I think plain old warehouse receipts as in this note is a receipt for one gm of gold, silver, rhodium or whatever held at 2015 main street Dogpatch, Arkansas is the way to go. Nobody has any idea what the future value of gold or anything else will be if desalination or asteroid mining takes off since precious metals would be a byproduct production of mining nickel or unloading sea salt. Nor are future industrial uses known computer chips already are starting to eat up gold it also is a catalyst for mitochondria in biotech. Yes Gold is an essential mineral in your diet and so is Arsenic but in very tiny amounts. In a biotech critter it might be needed in much larger quantities. So I would like to avoid seeing the economy married to a single product whose value could change drastically and quickly and repeatedly in different directions. More market oriented media of exchange will be needed as the economy and technology evolve. Also top down solutions work poorly in markets as the current administration is demonstrating.
     
  6. KissMy
    Offline

    KissMy Free Breast Exam

    Joined:
    Oct 10, 2009
    Messages:
    12,064
    Thanks Received:
    2,144
    Trophy Points:
    255
    Location:
    In your head
    Ratings:
    +2,923
    Permit me to issue and control the money of the nation and I care not who makes its laws.

    The Federal Reserves job was to expand & contract the money supply to maintain full employment & lend only to credit worthy borrowers. Those parameters were perfect for maintaining currency as a store of value. You could work extra hard & put some money away for the future so you could retire without burdening others.

    Then congress & presidents over the years tinkered with it. Once Congress included racist backing subprime mortgages so the minorities could buy more homes than they had financial discipline to pay for the currency went to shit. It was not primarily the minorities who took the system down but they were the reason they changed the rules. The value of the dollar is only as good as the credit of the borrower. Using racist affirmative action for lending standards instead of credit ratings doomed the currency. The US government's monster debt will eventually get a ratings downgrade. Since they are one of the largest borrowers of dollars their credit rating for the most part helps determines the dollars value.
     
    • Thank You! Thank You! x 1
    Last edited: Jul 17, 2010
  7. Baruch Menachem
    Offline

    Baruch Menachem '

    Joined:
    Sep 12, 2008
    Messages:
    14,204
    Thanks Received:
    3,235
    Trophy Points:
    185
    Ratings:
    +3,305
    the federal reserve was not set up until 1914. From the time Andrew Jackson closed down the bank of the United States until Woodrow Wilson came up with the Federal Reserve, banks issues their own currency. As did cities, states, railroads, etc. the currency had to be US dollars. One of the first reforms of the Lincoln Administration was the Comptroller of the Currency. This office licensed banks that issued currency. With the creation of the Federal Reserve, the comptrollers office no longer issued licenses to print money, but banks that had licenses continued to print their own money until the licenses expired in 1924

    [​IMG]

    Just because there was not governmnent sanctioned central bank does not mean that the functions of a central bank did not exiist. The house of Morgan acted as a central bank on several occasions throughout the late 19th century.

    The federal reserve is mostly noted for its rather abject failures at the job.
     
  8. Modbert
    Offline

    Modbert Daydream Believer Supporting Member

    Joined:
    Sep 2, 2008
    Messages:
    33,178
    Thanks Received:
    2,957
    Trophy Points:
    48
    Ratings:
    +2,962
    This would be impossible in 2010 and economically unfeasible.
     
  9. Paulie
    Offline

    Paulie Platinum Member

    Joined:
    May 19, 2007
    Messages:
    31,577
    Thanks Received:
    4,856
    Trophy Points:
    1,130
    Ratings:
    +15,424
    Don't think for one second that the house of Morgan stopped there, either. They were one of the biggest players in the creation of the Fed, if not THE biggest.

    Any idiot knows money is the most important thing in the world. One can argue against that with ridiculous emotional opinions, but at the end of the day it's that piece of paper that calls the shots.

    We can have a completely private central bank, or a completely public Bank of the US, and we will still get the same results, because those with the most power will still be calling the shots.

    We can argue this and a plethora of other political and economic issues until the cows come home, and none of it matters if we're going to keep putting the worst people in office that make the decisions.

    Let's just wake up right now and recognize that almost all of Congress is owned by those who couldn't give a flying FUCK about "the people". ESPECIALLY anyone who's served more than 1 term in their seat.

    We have the opportunity in November to literally make a REAL change.

    But we won't. Left and right will ruin it like it always has, and when that gets added into the collective lack of common sense and intelligence in the electorate, we'll meet the same fate as always. We get FUCKED.
     
    • Thank You! Thank You! x 1
  10. william the wie
    Offline

    william the wie Gold Member

    Joined:
    Nov 18, 2009
    Messages:
    7,302
    Thanks Received:
    676
    Trophy Points:
    175
    Ratings:
    +1,618
    More impossible and unfeasible than surviving a central bank incompetent to inflate the economy? I really want to see a reasoned defense of the Japanese post-1993 economic plan a la Bernancke because I don't think that is possible.
     

Share This Page