Money

I read somewhere that the reason they keep changing the paper money is to foil the counterfeiters. A few decades ago, counterfeiting had almost died out in this country because it was costing almost as much to print the money as it was worth. The advent of sophisticated photocopying changed all that, and now they are trying to design bills that are harder to photocopy. I'm not sure about the coins, but it might have something to do with collectors. That's why they make so many different styles of postage stamps, to appeal to the collectors. Every stamp that goes into a collection represents one letter that the post office gets paid for but will never have to deliver. I once read on Wiki that the U.S. still makes silver and gold coins now and then, but they never get into circulation because the collectors immediately buy them up for more than their face value.

The value of a painting or other object is actually latent value, it doesn't become actual value until you sell it or trade it for something. It's like when you own stocks that either go up or down. People say that you have gained or lost money, but it's really only a paper gain or loss until you actually sell the stock. If you gave all the poor people a painting, they wouldn't be able to sell those paintings for their declared value because there would be so many of them out there that it would drive down their market price. Antiques are the same way, it's not so much how old a piece is, it's mostly about how many of them were originally made and how many of them are believed to still be in existence. This is why, when the Federal Reserve inflates the money supply, it devalues the money already in existence and prices go up all over. The value of the goods and services purchased doesn't actually go up, it's that the value of the money goes down.

At least that's how it usually works but, for some reason, it's not working that way currently. The Fed has been creating 85 billion dollars a month for about three years now and inflation has remained quite low. I don't know why, but I speculate that all that money is not really going into circulation. I used to think that it was leaving the country as fast as they created it but, upon further reflection, I decided that would cause the U.S. dollar to lose value against foreign currency. I haven't heard of that happening yet, although exchange rates go up and down every day and I haven't been paying attention to them. Still, if the dollar went into free fall, it seems like it would be all over the news. My latest theory is that the banks are just sitting on that new money, maybe because interest rates are so low. Low interest rates are supposed to stimulate the economy, but not if nobody is borrowing or lending money.

One way or the other, money has to represent true wealth, meaning material goods and services. It used to represent gold, but gold has become too valuable to be used as money anymore. Now money is supposed to represent the economic potential of the country. If there is more money in circulation than the country is worth, the value of the money decreases accordingly. I don't know how they determine what the country is worth, but it must have something to do with all the numbers that are constantly being crunched by the experts.

I am no expert, but I have long believed that the only way to increase prosperity is to increase productivity. Come to think of it, though, there's more to it than that. It wouldn't do a lot of good to make a bunch of stuff that nobody wants and just store it in warehouses. First you have to make it and then you have to sell it. But how can you sell it if nobody has the money to buy it? Even if they do have the money, but don't want to buy the stuff, you can't force them to, unless you're selling health insurance. Even that might not work, it's a little too soon to tell.


I think that filibuster thing comes from an old parliamentary tradition that says, once somebody has the floor, they can talk as long as they want and you can't make them shut up and sit down. I think the house has it too, but they must have a different rule about how many votes it takes to over ride it. I guess I have no objection to the senate changing their rules because the constitution says that congress can establish their own procedural rules for conducting business.

I haven't thought about that Iran thing much. So far it has been all talk, and talk is cheap. The way I understand the latest treaty is that Iran promises to not make a nuclear bomb for six months and the U.S. promises to lift some of their "sanctions". I think sanctions have something to do with foreign trade, and I don't know why they are trading with those people in the first place. As I have said before,  they should stop feeding them and stop buying their oil, but they never do what I say anyway.