Just on CNBC,New $1.00 gold coin for general circulation coming in FEB.2000.

-- hap (happy@home.com), November 18, 1999

Answers

In the year 2000, the US Treasury is coming out with a new $1.00 coin that has the likeness of Sacagawea on the front and the Eagle on back. It will NOT be gold but will be gold colored like the Canadian Dollar is currently. If everything holds together it should be nice and am looking forward to it.

-- Kayla Michael (kaylam@jetcity.com), November 18, 1999.

Phewww...that's a relief. Can you imagine how small a $1 gold coin would have to be?

-- chairborne commando (what-me-worry@armageddon.com), November 18, 1999.

Did they say if it was going to dollar sized this time? The reason the Susan B. Anthony was such a flop was that it was about the same size as a quarter.

-- Ken Seger (kenseger@earthlink.net), November 18, 1999.

Anyone know how big the Canadian dollar coin is? Laurane? I'll bet the new US dollar will copy it, and why not? Canada's been patterning their coins after ours for years, with the exception of having functionality in US vending machines (grrr).

-------------- The corruption of a society can be measured by the number of its laws. --Tacitus

-- Cherokee (Cherokee@qtmail.com), November 18, 1999.

C.C.,

LOL! I was wondering that myself... "It's either gonna be REALLY tiny, or it's gonna cost way over a dollar."

Ever wondered why a $1 coin costs $11 (for silver) or in the $100's (for gold)? I certainly do, every time I walk into a coin or pawn shop.

Advice for gold buyers: Go to pawn shops, do a little comparison shopping between different pawn shops, even if in the same "chain". Last Jan./Feb. I bought an 18kt. Celtic-knot necklace for $200. Three weeks later, I saw the exact same necklace at Andrews Jewelers for $2,000 - seriously. I had the necklace independently tested, and it was confirmed at 18kt gold.

-- Deb M. (vmcclell@columbus.rr.com), November 18, 1999.

The new dollar coin will be the same size as the Susan B.

-- Me (me@me.me), November 18, 1999.

It sure won't be real gold. $1 of gold at $3000 per ounce or even $300 an ounce would be just a speck.

If it is to be "gold" colored, it'll probably be a sandwich coin like the dimes, quarters, and halves, but with maybe an anodized aluminum outer layer.

The important thing to bear in mind is that such a coin would be another fraud perpetuated by your government. Assuming it is cupro-nickel clad (copper and nickel) and maybe some alumninum, the "seigniorage" would be maybe around 95%. (That is, they sell you "5 cents" worth of metal for "one dollar.") Doubly fraudulent, for if it is really to be "golden" in color, they are trying to capitalize on the color -- appearance -- of gold, without providing the value of gold.

Do any of your REALLY still believe that your government can be trusted on ANY level, in ANY endeavor, to be honest? (Including Y2K, martial law, drug warrioring ...) If you do, you are fricking hopeless clueless doofuses.

-- A (A@AisA.com), November 18, 1999.

What a very strange reaction.

In the first place, a medium of exchange is intended to be symbolic only. It isn't to be *used* for anything but exchange. If it works (as the Anthony dollar did not) because people accept it in exchange for something *intended* to have intrinsic value, then it's perfectly good.

In the second place, the Anthony dollar bombed mostly because people mistook it too easily for a quarter. So they decided to change the color. Would green have been less "fraudulent"? I imagine they were looking for a compromise among various goals -- attractive, durable, inexpensive to manufacture, distinctive, doesn't confuse vending machines, etc.

-- Flint (flintc@mindspring.com), November 18, 1999.

If you want to know more on the upcoming Sacagaewa Dollar coin, you can go to a nearby coin store. There has been quite alot in the press about this upcoming Dollar coin. It has Sacagawea on the front with her son Baptiste, on her back and the American Eagle on the back. It is an extremely nice coin. I do think the sixe is also smaller, being near the size of the Susan B. Anthony Dollar coin or the Canadian Dollar coin. If the world does NOT go crashing because of Y2K then it should be a very nice coin to have in our circulation. It is about time we honored the Native Americans and Sacagawea instead of the usual rob, steal, and kill like our history has been.

-- Kayla Michael (kaylam@jetcity.com), November 18, 1999.

Typical Flint TPTB apology post.

In the first place, a medium of exchange is intended to be symbolic only. It isn't to be *used* for anything but exchange. If it works (as the Anthony dollar did not) because people accept it in exchange for something *intended* to have intrinsic value, then it's perfectly good.

Wrong! Ever hear the story about the 300 year old bottle of brandy? Briefly, a "good year" brandy was traded through the years for ever increasing prices. Finally it reached a connoiseur who paid many thousands of francs (or dollars, whatever) for it. The chap held the bottle for some years, and at a major event, decided to use the bottle as part of a major celebration. At the event, he went on and on to describe the lineage of the vines, the bottler, the year, the reputation, etc. And with that he uncorked the bottle. The cork crumbled and moldy, the brandy rotten and vinegary.

Even though he epxected no recompense, he went back to seller and complained, the seller replying, "But monsieur, the brandy was for trading or collecting, not for drinking."

Flint, you, by your own comment, have placed yourself in the category of clueless doofuses.

-- A (A@AisA.com), November 19, 1999.

-- Hawk (flyin@high.again), November 19, 1999.

A:

I cannot provide a basic, simple education for you here. You must try to read and try even harder to understand what you read.

Essentially, you are advocating a barter system where the most commonly bartered commodity is almost but not quite worthless for any purpose but trade. In fact, the coinage exists at all as a minor slop- handling mechanism in our electronic systems, which really *don't* have anything but symbolic value. You are confusing an undesired but unavoidable side-effect of a *physical* medium of exchange (the fact that somebody, somewhere, can find an immediate use for nearly anything physical) with the *purpose* of that medium. This is exactly backwards.

Why not correct your misconceptions, rather than defend then with name-calling? If this is your level of discourse, people might suspect your analysis is no better.

-- Flint (flintc@mindspring.com), November 19, 1999.

Flint:

I cannot provide a basic, simple education for you here. You must try to read and try even harder to understand what you read.

Essentially, you are advocating a monetary system based on perceptions, authority, "confidence", deception, and "symbolism" having no referent to reality. A commodity (real thing) used as money imposes at least some discipline in the market as opposed to a fiat money which can be and is easily manipulated by TPTB. Basically, the difference in preferences illustrates the difference between one like yourself who advocates a manipulative, deceptive, authoritarian (if not outright fascist/communist) government vs. someone like myself who believes in freedom and a minimally intrusive and manipulative government.

By the way, I merely oultlined what a doofus is. I didn't call you a doofus (this time at least). By your comments, you place yourself in that class.

-- A (A@AisA.com), November 19, 1999.

A: Yep.

-- me (anothernottakeninby@Flint.x), November 19, 1999.

What the hell. Flint, YOU are a DOOFUS!!!!

-- King of Spain (madrid@aol.cum), November 19, 1999.

Look, I'm not trying to "take anyone in". I'm trying to explain the nature of a medium of exchange.

Nearly everything that exists has two kinds of value -- intrinsic and exchange. Intrinsic value refers to what something can be immediately used for -- food, construction, entertainment, etc. Exchange value refers to what you can get by trading it. Some items (like paper dollars) have almost pure exchange value. There isn't a whole lot you can do with a paper dollar more useful than trading it for something else. Other things have almost pure intrinsic value -- like that stone you picked up on your honeymoon. Priceless to you, worthless to anyone else.

A pure medium of exchange is all exchange value and no intrinsic value (that would cause it to be removed from circulation and used immediately). Bits on magnetic tape or disk in banks have pure exchange value.

An ideal medium of exchange has certain properties:

1) NO intrinsic value. If it has such a value, people remove it from circulation and use it directly for its secondary use. For example, people use gold to make jewelry. Some agrarian societies have used seed corn as the medium of exchange. But people remove that from circulation and plant it. Ideally, a medium of exchange should be useless for any other purpose but trading. Purely symbolic.

2) Durability. Properly handled, a medium of exchange lasts a long time. You should be able to store it almost indefinitely. Things that can die, spoil, or rot in storage are not suitable. (True, bits on tape or disk must be refreshed).

3) Subdividability. A good medium of exchange should have clear denominations. It should be easy to make change. The smallest possible denomination should be small enough so as not to require subdividing for most useful purchases. Most barter systems are clumsy because the items being traded are difficult to subdivide -- you either kill them (food animals) or render them worthless (like TV sets) if you subdivide them.

4) Recognizability. The medium should be immediately recognizable as a symbol of value, as should the denomination. Arguments as to what it is "worth" in trade should be kept to an absolute minimum. People might doubt whether your gold is pure, or some kind of alloy.

5) Common agreement. People are willing to accept a medium of exchange only if they're confident they can subsequently exchange it for something else. Therefore, members of an economy must all agree that the medium is a symbol of known negotiable value.

6) Portability. It should be as easy and convenient as possible to carry around a good medium of exchange, and deploy it as necessary. Portability is one of the selling points of credit cards.

7) Universality. A medium of exchange should have the same value to everyone in the economy. Another problem with barter is that the starving person may have nothing worth your hog, while the person who has what you want may place very small value on your hog. A good medium of exchange should be exchangeable for *anything*, and therefore have equal value to anyone in an economy, regardless of the intrinsic value they desire.

Those who view "money" as coins or paper (which constitute only a tiny tiny fraction of all money) are confusing the footprints with the sasquatch. In fact, we've been moving very rapidly in the direction of an all-electronic economy. Credit cards or checks are accepted nearly everywhere except in vending machines. Many people no longer bother (nor do the need) to carry any physical currency with them at any time.

All I can ask is that people like A and KOS consider these issues. At least try to counter them with something beyond childish name calling. I can only repeat -- If your arguments are puerile, people will suspect your understanding is too.

-- Flint (flintc@mindspring.com), November 19, 1999.

Flint, you crack me up! NO intrinsic value? Out of where did you pull that one? The rest of your criteria are close to accurate, but that one is laughable. Perhaps you forgot the part of the Constitution that says the ONLY lawful money of The United states is to be GOLD and SILVER. They did this for good reason, after having been savaged by fiat currencies (remember 'not worth a continental'?).

I'd love to debate this further, but I must be off now, to cook supper for my kids. I,ll leave you in 'A's capable hands, for now.

Sorry, Flint, I'll follow the Founders on this one.

Gods

-- Pinkrock (Aphotonboy@aol.com), November 19, 1999.

Pinkrock:

I suggest you reread the Constitution. You are simply wrong. However, you are accurately parroting the party line of the gold fanatics.

This "only gold or silver" canard has been posted here before, each time with someone coming back and QUOTING the Constitution to show otherwise. I wonder why this error hangs around?

-- Flint (flintc@mindspring.com), November 19, 1999.

I should add that gold has little intrinsic value to the individual beyond jewelry. It does have some good industrial applications (conducts electricity well without corroding, so it's used to plate computer connectors and such). Silver, beyond jewelry use, is consumed in photographic emulsions, but few individuals make emulsions. But those who claim gold has any real intrinsic value because it's gold may as well claim birds fly because they fly. This is a tautological explanation, and no real thought underlies it.

-- Flint (flintc@mindspring.com), November 19, 1999.

Flint -- you disqualified yourself with your item 1). It should have intrinsic value. The more the better. If one can create money cheaply then everyone can do it. Then the government steps in and gives the privilege to only a select few (like the central bank [Federal Reserve in the U.S.]) The otherwise cheaply made money by a non-franchisee is then deemed counterfeit, and those issuing "unapproved" (color photocopies, for example) are subject to criminal sanctions. You are an advocate of privilege and coercion.

Is it you, or someone else on this forum that is supposedly a professor of economics? If so, no wonder we have a nation of economic illiterates and slave fodder.

-- A (A@AisA.com), November 20, 1999.

A:

Sigh. Somehow, we're not on the same wavelength. Almost none of the "money" in the world has any physical representation to speak of. It consists of bits on magnetic tape and disks, plus data protocols for storing and reading those bits, plus (at a high level) laws and regulations governing the interpretation and manipulation of those bits. This system works pretty well. And the bits themselves have no intrinsic value whatsoever. They are purely symbolic representations ultimately reflecting the value of all of our labors past, present, and projected into the future.

Now, what you're talking about is the tiny percentage of physical representations -- paper and coins. And within that tiny percentage, you are addressing just the coins. I don't have the numbers handy, but I suspect the coins alone represent less than a hundredth of a percent of the money "in circulation". Ask yourself how much money you have right now. Of that, how much has *any* physical representation? Do you suddenly feel much poorer? Don't be silly.

The use of paper and coins, as I wrote, is dying of natural causes. Right now, they are used only for small face-to-face transactions, primarily because for such transactions they're a bit faster than checks or credit cards. If we made the deliberate effort to phase them out altogether, it wouldn't be hard, or take long, or affect the economy in any visible way.

Now, why would this extremely tiny (and economically unnecessary) fraction of the "money" NEED intrinsic value? The intrinsic value lies in what you *purchase* with money, not in the money itself. You are free to purchase gold or silver with your money, of course. But what you have purchased isn't "money", it's something with some minimal intrinsic value (mostly jewelry, though I'll give partial credit if it gives you peace of mind, much like purchasing, say, a fire extinguisher). If you should decide to "spend" your gold or silver, you do so by first selling it for actual money, same as you'd sell that fire extinguisher. Then you spend the money!

I already explained why no form of money should have intrinsic value. I guess you missed it. People would then remove it from circulation to *use it up*. When US coins had some real silver content, there came a time when the silver content was worth more than the coin itself. People melted them down, removed the silver, and sold the silver for money! In other words, those coins weren't treated as money, they were treated as ore! This was the cost of people in government having the same misconception you have. They learned from their mistakes. You seem unable to do so.

In any case, coins are nearly irrelevant economically. REAL money remains symbolic as it should be. A medium of exchange can't work if the medium is more valuable than the exchange. Please think about it.

-- Flint (flintc@mindspring.com), November 20, 1999.

Flint: I have many more important things to occupy my time than trying to eradicate the brainwashing you, and so many others, are the victims of. But, I will waste a few words here for your benefit.

In a letter to Thomas Jefferson in 1787, John Adams wrote: "All the perplexities, confusion and distress in America arise, not from the defects of the Constitution, not from the want of honor or virtue, so much as from downright ignorance of the nature of coin, credit and circulation."

Sadly, this is even more true today, as you so eruditely demonstrate.

Title 12, United States Code, Section 152 states: "the terms 'lawful money' or 'lawful money of the United States' shall be construed to mean gold or silver coin of the United States." You are correct, Sir, this is not in the Constitution. But it is in the United States Code, and it has not been rescinded, merely repudiated.

Money is an idea. It is the common denominator of all economic transactions. But it must have a representation in physical reality, otherwise its only underpinnings are confidence, and this turns the whole economic world into a confidence game. Throughout history money has been represented by various commodities. The existance of such a commodity is a precondition of a division of labor economy. It must possess certain characteristics, some of which you elaborated: durability, homogeneaity, divisibility. But there are other essential characteristics which you missed: rarity and high unit value, which lead to portability. Many commodities have served down through history, but gradually one has achieved universallity: gold. This is because it has significant advantages over all other media of exchange. The creation of an international banking system and credit instruments are merely logical extensions of the creation of a medium of exchange, which act as a substitute for, but must be convertible into, that medium, i.e. gold.

I'm sorry, but I must be off now, to more important matters. I know I'll never change your mind about anything, Flint. Nor do I have any interest in doing so, but your disinformation hurts others. It may also hurt you if your precious digital bits are rendered into electronic hash, as may happen if TSHTF as a

-- Pinkrock (aphotonboy@aol.com), November 20, 1999.

Pinkrock:

You raise some points to be considered. I'll do so, but you should understand that "my precious bits" aren't something I hold precious, nor do I necessarily argue that this is the ideal form for money to take. Bits have drawbacks as well, as the possible "hashing" of those bits clearly demonstrates.

[Title 12, United States Code, Section 152 states: "the terms 'lawful money' or 'lawful money of the United States' shall be construed to mean gold or silver coin of the United States." You are correct, Sir, this is not in the Constitution. But it is in the United States Code, and it has not been rescinded, merely repudiated.]

I'm not sure "repudiated" is the right term. A lawyer might argue that this Title doesn't prohibit any other form of money, but rather enunciates *one* of the forms lawful money may take. In any case, I'll discuss the situation that would arise if this is taken to mean these are the *only* forms money should legally take.

[Money is an idea. It is the common denominator of all economic transactions. But it must have a representation in physical reality, otherwise its only underpinnings are confidence, and this turns the whole economic world into a confidence game.]

Good point, since it clearly begs the question of the source of that confidence. Why would I exchange something useful for something I have no specific use for, unless I can subsequently trade *that* for something I can actually use? And if I have no use for the intermediate representation, then it is purely symbolic. Which means I value an otherwise useless commodity *because* I have confidence that I can trade it for value later. It doesn't matter *what* that representation is, so long as it's useless for any purpose but trade (you can't eat gold). And "useful for trade" implies confidence. You can't wiggle out of that, regardless of your representation.

[...rarity and high unit value, which lead to portability. Many commodities have served down through history, but gradually one has achieved universallity: gold. This is because it has significant advantages over all other media of exchange.]

No, it does not. Consider for a moment -- gold does indeed have some advantages as a medium of exchange: (1) It's nearly useless for anything else; (2) It's rare and durable; (3) It's hard to counterfeit (but not that hard to debase as an alloy); (4) It's pretty, so people like it; (5) It can be subdivided; (6) it's portable, at least in quantities suitable for most purchases.

Indeed, the only drawback to gold as a medium of exchange is that the quantity of available gold cannot be easily adjusted in a constant ratio to the total value in an economy. There's only so much of it, and we can mine it only so fast -- and MUCH slower than an economy can grow. So for example if we took all of the available gold and divided it up according to current market values such that there was enough gold to purchase General Motors, then the amount of gold necessary to purchase a candy bar would be microscopic -- mere molecules.

So the money supply must be adjusted to match the size of the economy. This implies a LOT more control over that supply than we have through the contingencies of finding gold deposits. We may not find sufficient deposits to match the economic growth rate (historically, we've fallen far short of this). Conversely, we might (for all we know) find an asteroid miles across composed of almost solid gold. If gold were our physical medium of exchange, this discovery would necessarily result in accidental massive inflation. We'd like to avoid such contingencies.

[The creation of an international banking system and credit instruments are merely logical extensions of the creation of a medium of exchange, which act as a substitute for, but must be convertible into, that medium, i.e. gold.]

This is a failure to understand symbolism. Don't feel bad -- your failure is common (but still a failure). Let's assume that your dreams come true, and all of those instruments *are* convertible into gold should you so desire. First, the gold itself still has no intrinsic value -- you can't *do* anything with it except trade it for something you *can* do something with. Second, given the gold supply relative to the economy, you'd need to be satisfied with a few molecules -- are you? And third, these instruments *are* convertible into gold today. Gold is a commodity for sale like any other, permitting exactly the conversion you desire!

So what's your point here? That banks should negotiate with gold dealers for you? Or do you recommend that banks *be* the gold dealers? What difference does it make?

-- Flint (flintc@mindspring.com), November 20, 1999.

Flint -- you are right on one thing. Most "money" IS electronic, having NO BASIS in reality (i.e. a tie to something real). THAT IS THE PROBLEM. And only a favored few get to create that money. And THEY get first call on using it and seeing who is next in line.

OTH, it is possible to have electronic money based on REALITY. Reality is ncecessary to prevent manipulation and inflation. But because REAL money precludes the amount of manipulation and inflation possible with fiat money, TPTB are opposed to it.

For a working example of reality-based electronic money, check out Gold & Silver Reserve at http://www.e-gold.com

I'm done here. You, if not part of the establishment as a lackey, are what has been denoted in other threads as a "useful idiot". (Not to say that you don't have a significant verbal facility.) And I'm not. 'Nuff said.

-- A (A@AisA.com), November 21, 1999.

Ah, Flint. I should know better than to start something like this discussion with you. I woke up this morning all ready to write a new little essay and demolish your arguement, but I find that I cannot. First, I made some coffee and browsed through the new threads. And it just made me weary.I have lots of things left to do, and possibly not much time to do them in. Normally, I enjoy bantering about this subject, but just now, I don't have the energy. Your side has already won this arguement, anyway. I point out that your edifice has no foundation, and you say 'That's a feature, not a defect.' The proper time for this discussion will be after the end of this cycle, when it's time to build again.

You and yours have won the disinformation war too; the sheeple will continue in their somnambulistic state. There will be no pre-panic, and minimal pre-paredness. But your victory will likely turn to ashes in your mouth.

Consider this: The only backing our currency (and consequently, the world economy) has is the 'full faith and credit of the United States Government.' This huge bureaucractic weed is more bloated and corrupt than Jabba The Hut, and will likely find itself lying on its massive, flabby side, twitching in helpless, agonizing deaththrows by spring. Who will have faith in them then? Even if they are only crippled and not killed, how good will their 'credit' (which is TOTALLY dependent on future tax revenues) be? Oh, I know, I know, you don't believe any of this doom and gloom nonsense, but your belief is just as much pie-in-the-sky as their ephemeral 'budget surplusses.'

Sorry, I'm in a bleak mood this morning. I see not much good news; I sense a mounting undercurrent of hysteria; I fear we are all about to learn a painful lesson in economics: energy is the ultim

-- Pinkrock (aphotonboy@aol.com), November 21, 1999.

Rats! This frigging server keeps cutting off the ends of my posts! No wonder the wretched Andy Ray is in such a dither. That last line should read: energy is the ultimate currency.

Stupid computers! Tears of God. Fools are we.

Them that dies may be the lucky one

-- Pinkrock (aphotonboy@aol.com), November 21, 1999.

Flint et alia, thank you for the education. NOW I understand about this stuff I've always dreamt of.

Night train

-- jes a po ol footballer, who played before they paid in REAL money (nighttr@in.lane), November 21, 1999.

Look, I didn't say I was *opposed* to backing "money" with gold, or even using gold as currency directly. I was simply pointing out one drawback gold has as a medium of exchange, and one misconception.

The drawback, as I explained, is the difficulty matching the total quantity to the total value in an economy. The typical result must be deflation, since the economy (any economy) can grow much faster than the gold supply. If an economy shrinks (suffers a depression), the result must be inflation since we aren't about to bury gold back into the ground to compensate.

The misconception is that gold has intrinsic value. This is a misunderstanding of what "intrinsic" means. All the arguments in favor of gold I've seen, when you get down to it, emphasize that even in the worst of times gold retains public *confidence* that it's worth something. Fundamentally, this is because gold is rare, pretty, and doesn't corrode.

The "full faith and credit of the US government" is something I regard as basically window dressing. Yes, the government does have a LOT more control over balancing our current money supply to economic health than it does with gold, thus rendering the purchase power of a dollar much more constant. And to some degree that boosts confidence. But basically anything that's accepted as a medium of exchange by everyone in an economy, *no matter what it is or why it's accepted*, meets the critical "confidence" requirement for a medium to work.

-- Flint (flintc@mindspring.com), November 21, 1999.

"Banking was conceived in iniquity and born in sin Bankers own the earth. Take it away from them, but leave them the power to create money, and, with the flick of a pen, they will create enough money to buy it all back again Take this power away from them and all great fortunes like mine will disappear and they ought to disappear for then this would be a better and a happier world to live in But if you want to continue to be slaves of Bankers and pay the cost of your own slavery, then let Bankers continue to create money and control credit." Sir Josiah Stamp, Director of the Bank of England.

John Kutyn 16 February 1999

http://www.gold-eagle.com/gold_digest_99/kutyn021699.html

-- lastword (last@word.x), November 22, 1999.