A Great Video About Money That You Need To See

There are those who believe that we need to return to a gold standard; but, they do not understand what money really is and the consequences of limiting the creation of money. Money is a promise, it is a promise of goods and services. It is paid to you based upon your contributions to society and you pay it to others to receive something equivalent in exchange. If I put in an 8 hour day at work, I want to receive something equivalent from others. Money merely represents that effort.

There is a concept called liquidity, it is your ability to borrow money now and pay it back later. This concept was critical to farmers as they need to borrow money to afford to wait until their crops have come in. It is also important to businesses that want to expand. Both gold standards and currency restrictions create liquidity problems. By limiting the supply of currency you choke off the small guy. The manipulation of markets is basically the constriction of who can be involved until you only have the rich.

Lets look at this another way because it is important. I cannot easily increase the amount of gold in the world. In and of itself it is of little real use, you cannot eat it. In fact, currently, if you sell 1/3rd of an ounce of it, you have to report to the federal government who you sold it to. It is easily confiscated as was done during the depression and represents nothing. Imagine a world where the only currency was Van Gogh paintings, would we begin cutting them up into little pieces for smaller transactions?

One of the problems with the Bitcoin is that the supply never increases. This makes no sense as there is more labor available than the number of Bitcoins will ever exist. We will move to an electronic currency, for it to have any real meaning it must be tradeable on small levels. If one Bitcoin is currently worth $150, how can I use it to buy a pack of gum unless I either have to buy $150 worth of gum or go without? For a currency to work for everyone, it has to be scalable. You have to be able to save up to it.

Berkshire Hathaway is generally considered the best stock in America, if not the world. It costs about $150,000 a share and appreciated for 40 years straight at about 25% a year. It is amazing that pension funds invest so little in it. It is criminal that they do not. You and I cannot afford to buy the stock if you are an average person. For most of us our primary investment is our home because you can pay for it over 30 years. The housing bubble was intended to take this investment away from most people who in the future will be renters.

The real attack on the middle class is to take away their ability to accumulate real ownership over anything. This is a return to the feudal system. Even in ancient Rome, slaves could own things. The concept of capitalism, real capitalism is that if you work hard and save, you can eventually own things like a house. You can give your time and effort now with the belief that someday you can acquire enough to be free. The attack on 401ks and pensions and social security is an attack upon your ability to ever be free.

YouTube - The Impending Collapse of the World Economy (Full Documentary)