Saturday, January 1, 2011

Is the Dollar worthless? Is it truly fiat?

One could only hear the commercials: Buy Gold! The Dollar is Worthless! GOLD! It's $500 and ounce $600 an ounce $700 an ounce $800, $900, 1000, 2000, 3000, with the rate of inflation: $6,000 YOU'RE GONNA HAVE TO BUY GOLD NOW!!!!! Or do we? Ask yourself, we buy gold for the long term investment, but what do we get back in return when you cash it in? You got it. Fiat money.$6,000 a troy ounce of worthless paper...or is it? Why do people who do buy gold want something as worthless as the U.S. currency? Well maybe because it isn't. Think for a sec. Derivatives. Bubble, Speculation $1.1 quadrillion? All use fiat money. Again, is the dollar worthless?

Lets See

1.00 USD = 0.748559 EU

1.00 USD = 0.640553 GBP
1.00 USD = 81.1500 JPY

The dollar looks weak compared to the three currency, yet compare the dollar to say, oil-rich nations like:

1.00 USD = 3.75010 SAR

1.00 USD = 6.59100 CNY
1.00 USD = 1,120.60KRW
Then there are our friends

1.00 USD = 0.997400 CAD
1.00 USD = 12.3610 MXN
1.00 USD = 6.34000 TTD
What's TTD? Trinidad and Tobago, a small Caribbean country just north of Venezuela

Three countries who are our currently in our sites: Russia, China and South Korea. How is it that our dollars there go farther than the three above mentioned? And lets do one more country

1.00 USD = 1.00000 USD

Yes, I calculated one USD to USD and it is exactly One U.S. dollar. The value never goes up or down, so how is it that with our dollar going strong in China and Korea, we're worried about inflation? And, if we truly are worried about prices going through the roof, why not make products here in the U.S. instead of China and Korea? Because the same people who are saying the Sky is Falling or gold will go high because the value of the dollar will fall stand to make millions if not billions Maybe trillions as they cash their gold stocks in from the fear of the weakening dollar, when in fact, the dollar may be tattered in a few places, but strong in others. Will we allow these wealthy billionaires and possibly trillionaires (not a word yet) to become even more richer? Is this their way to take hold of the Republican and Blue Dog Democratic party through fear? If we keep buying crap in fear, watch gold drop to 1970 prices

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