two notes: 1- paper money can work in a free banking system (competing banks, no fed), with the backing of capital and the reclamation of debt. 2- the reason that most people call "crank" for speccie is that Keynesian fear of deflationary effects, or the hypothetical "gold asteroid"
Another lecture by Woods that everyone should listen to. If I taught high school or college economics, I'd assign my students to listen to this video & write a report about it (whether they agreed with it or not & reasons for or against it).
I like the fact that Tom addressed fractional reserve banking. Even if we get rid of the federal reserve, we should have a transition phase away from fractional banking. Put it into the Constitution that: only metal commodities can be money, no fractional reserve lending, and Congress cannot dictate the value of money. Money should be allowed to float freely. If we can do this, the world will experience the peace that it deserves.
@sfiorare I did check it out and he talks about all of those panics in other videos. It wasn't so much volatility of the currency so much as volatility of the state steering the money supply and so on. If you want to refute the gold standard you can't substitute knowing your opponent's positions with covering your ears and spouting what you 'know' to be right. View the tom woods videos in the related, mises articles on the subject and then talk about volatility.
@ 23:50 Or put another way: "The government and banks are far less relevant in this case and that's how it ought to be." Under a sound money system, the power naturally increases within the individual as opposed to the banks and governments that have gotten used to sharing the power and having the interest of the individual so far up their behinds... @25:50 No. It is impossible. The banks and Fed chairmen know this. They don't want for anyone to have a future. The politicians also know this so they want you to put your future in their hands. @27:18 Yup! All assembly line, sweat off the brow workers... @28:25 which none of us watching are...
The Price system can not work in a situation where true prices discovery can not take place. True price discovery can not take place in a situation where the currency is losing it's value, and prices are distorted through government intervention. This is exactly what Mises was saying. What you are saying is that since governments distort reality that we must have more government to prevent this distortion of reality from causing humans to get mad about getting screwed over for their labor.
@lomocan You are right. I did not mean to say that it is just scarcity that causes violence. There are many factors as to why humans create violence. The problem is our socioeconomic system. Thank you for not bashing me like many people on youtube! Hopefully, more people in our society can have more civil discussions.
Money is utterly neutral. Like a knife or a stick, it can be used to harm or to do good. Ancient Japanese saying, "There are two kinds of sword. There is the sword that kills, and the sword that gives life."
I don't blame you for misinterpreting his message. You don't have a clear understanding of Bill's message and that's OK. His message is not to suggest no competing currencies. He's all for competing currencies. He just doesn't want the govt to borrow it into existence with interest attached to it, because then you have to borrow more money to pay off the interest. Gold standard or not. The tally stick worked great. When the debt was repaid, the stick was removed from circulation. Simple.
Several American Colonial governments (like Pennsylvania) issued fiat currency and successfully controlled inflation, functioned nearly tax free, and had zero debt. They did this out of necessity because the commodity money systems failed as gold left the country to balance their trade deficits with Britain. The lack of currency created economic hardship, but this was artificial as prosperity lies with the productivity and industry of individuals, not the intrinsic value of a currency.
That's a very good point, equating units of the currency to votes on economic activity. Inflating fiat money is morally tantamount to stuffing a ballot box. -jcr
@lomocan I just want to mention that what if one day, corporations will decide not to use human labor, because to earn more money, they can use machines.Technology is growing so rapidly, and the U.S.'s majority of jobs are in the service sector. What happens if companies decide to have the service sector replaced with machines. It is happening in the world today. What job's are going to replace the service sector? Do you think that technological unemployment is not happening?
@sfiorare i accept that there is a higher standard of living but thats not what i asked. what i asked you is specifically what kind of progress you attribute it to. it seems like you can get mad about me using the word prove and call me a kid but so far you still have not answered any of my questions. if youre just going to keep avoiding my questions im simply going to stop asking them. thanks for all the views and comments on this video, boosting its search ranking :D
Yes. I think when we will create all possible jobs on earth, we will then be going create even more jobs in space. There will never be the limits to possibilities. The only hurdle will be corrupt power.
A currency or medium of exchange does not need to have an intrinsic value itself, just the goods or services exchanged and represented by the currency. Gold can serve that purpose, but people have historically stored it with goldsmiths or banks and used paper representations for daily transactions. Great, but the banks invariably start lending out more paper than they have gold. It would be helpful if Mr. Woods pointed out where money really comes from - banks, not the government.
Often... Those supporting inflation of the money supply in order to prevent deflation of prices also claim to believe in "sticky wages". I could be wrong, but I think that deflation of prices with "sticky wages" would help the little guy because the deflation of prices would "act as" a consistent increase in wages over time.
Agreed. Add something like what the "interstate commerce" clause was supposed to be, and I think the Articles would have done just fine. ...at least for a while. I think there would still have been the ratcheting effect of "crisis, program, program never goes away", but starting at a lower power point it would have taken longer to reach the present repulsive leviathan. Ever read L. Neil Smith's "The Probability Broach"?
Once one corporation goes fully automated, they will have there prices drop so much, that in order for their competitors to compete, will have to follow suite. Watch and see.
> Debt-free government issued fiat worked well in the American colonies and during the Civil War, and can again. Ah! You saw "The Money Masters" and didn't notice how they went horribly wrong. But now you've discovered the Mises Institute and can rectify that lack.
The really messed up part is that it's impossible to fully understand exactly how it all works. There are so many interactions with the monetary side (Fed, the individual banks and fractional reserves) and the consumer side (govt, taxpayers, "normal consumers") that there IS no predictive ability. Which is supposed to be the big selling point of the Fed in the first place. I say "supposed to be" because the real benefit of the Fed goes to its member banks.
@lomocan but what happens when we run out of gold? I am more for gold than a money system backed up by nothing... but isn't it time to move forward beyond money? The first step is sound money, but then after that, scarcity is still taken place, which results into economic inequality, thus violence occuring... how can we stop this with a gold standard? We can't.
@benandreas369 even if a dollar equal . 000000001 oz of gold, that would not devalue the dollar. The beauty of gold is it is divisible, unlike most commodities....
But the technology we are creating, isn't for new employment/ human labor, it is to reduce it, which those technologies will do. They are not going to create more human employment. Once automation, always automation. Unless we become part machine, which is another possibility, and you may be right.
That's like saying you hate food, clothing and a warm and dry shelter. Money is no different, it's just a better way to gain those things, and other things. You don't hate money. You hate 'fiat' money. Fiat money is what enables speculators and leveraged buyouts, conspicuous consumption, massive debt, wars of aggression, etc., etc..
@Leofus1986 - the relevant thing is that the average person today a much more wealthy than in 1895 what do you think of the human rights situation, in china?
In my opinion, Gold and Silver are what our currency is meant to be... UNTIL the majority of human beings on this planet's wealth has risen high enough to allow them all to be like the US was ten years ago. This will allow digital fixed currencies. We'll have a mix of both for a long while and if the gov allows the competing of different curries. This is logically how the product known as currency will evolve further if you look at 100% of all its functions/requirements..
@benandreas369 we can't run out of gold. We also can't move beyond money. It takes god-powers to make all you need without trade. You require the work, materials and skills of others, so you require trade. "beyond money" = "all humans are dead". Scarcity & inequality are nature, are GOOD. Violence happens to CAUSE inequality, also, more than to stop it.
It will always be THE only currencies. Digital currency will be equal to current federal reserve system, where Ben can write any amount of credit without limitation in his computer. I know i know, in the beginning they will say it will be utopia, but it was the same with paper money which today became quasi digital currency. The problem with digital currency, if you will be able to buy real assets, land, companies, buildings, oil, gold with it, then inflation will be a problem again.
@BrettDunbar - that's funny considering what the mises institute does high-school indoctrination program google: "economics for high school students mises"
Wrong. The paper representations are like a receipt, and is payable to the barer on demand. The paper isn't the money; the gold is. And money doesn't come from the bank, it comes from the depositor. If the bank distributes more notes than deposits, it's called fractional reserve banking, and done so without the depositors permission is a breach of contract. Point is, money comes from the depositor, not the bank.
What good would it do a corporation to have robots do all the work if there were no people with money to buy their products? You're looking at only one side of the coin.
That is assuming that technology doesn't expand into new realms and allow for further employment. You are making an assumption based on what is now, rather than what humans are capable of.
@sfiorare in 1895, it took a lot more people and a higher price in energy to produce a bike. Also, 8 cents was worth $7.84 in today's dollar. Even if your facts were correct, they are irrelevant.
> where money really comes from - banks, not the government. Legal Tender laws are pure government. Without those laws, commodity money would be the rule. It is only in an environment of legal tender laws that "bad money drives out good." Without those laws, good money drives out bad because bad can be REFUSED.
Bill Still >> Tom Woods Fiat currency only appears bad because of how it's currently used. It's not what backs a nation's money; it's who controls it's quantity. If I create a coupon for a free back rub, I give you the back rub and then tear the coupon up because the debt has been paid. Do this same thing with fiat money, and then remove it from circulation once debts have been repaid to avoid hyperinflation and everybody wins except Wall St investors in that casino called the stock market.
@tewj57 - i guess you didn't understand my previous answer, let me give you a specific example: a 20% rise for 8¢ per hour is 1.5¢ in 1895 an average worker had to work for over a month to earn enough to buy a bicycle, now it takes a day or less you throw around the term 'proof' like a little boy that has no idea what it means
Gold and Silver merely facilitate a function. Stability is the area in which fiat currency continues to fail. However there are digital currencies, like bitcoin, which account for this. This is why fiat currency continues to be used after abandoning hard currency. It is also why they fail, when they fail to look at 100% of all the uses and functions of currency, besides the oversimplified, "medium of exchange" garbage. Fiat currency doesn't have to have inflation either. FYI
True. It doesn't have to but it does. Because human nature is built into FIAT through money manipulation. Gold or silver doesn't give two shits about human nature. It just is. Value in hand. A pure element. This is the main reason why precious metals are far superior to any FIAT.
@mrzack888 Quite unlike the Keynesians, who aren't at all repeating the same old things again after again, even after the 1970s stagflation disproved them.
So what you are saying is that your argument now is to attack me rather than actually prove what I have said incorrect. That makes it an Ad-Hom, which is a fallacy.
Of course, those who possess gold and like their money to make more money will be against this, because it takes away their ability to get richer when they have not produced any goods/services other than to create more money from money. Money should be a denomination of what you produce. Money should be for the benefit of we the people, not we the bankers. Get rid of fractional reserve banking, interest, borrowing money into existence, and we the people win. Not the plutocrats.
@sfiorare Yeah well it doesn't help when the people trying to inform me, like yourself, resort to ad hominem attacks instead of, you know, having a real argument.
