> D. Jay Newman wrote:
> >> Rome was destroyed by mob rule. The mob simply voted themselves funds
> >> from the public chest
> >> until theren't enough gold left to pay the troops to protect the empire.
> >> This is what is happening in
> >> the USA now.
> >>     
> >
> > Sort of. The problem is that money is like stock: it only has value
> > because people believe it does.
> >   
> er, actually, no. Roman coins had intrinsic value of gold or silver. The 
> VALUE can't be changed
> with gold or silver.

That's also a myth. Usually the state sets the value of gold and silver.

And gold and siver have very little real value in and of themselves.

> >
> > And why should currency be backed with gold? Can you eat gold?

> Sure you can. Take a look at what happened to Germany after WW I. A 
> wheelbarrow of currency
> could not purchase a loaf of bread. Adolph Hitler became a hero when he 
> returned the German
> Mark to the gold standard. When the German Mark became redeemable in 
> gold, its value returned.
> 'course, he got the gold by force from rich Jewish  families, but that's 
> another story.

That is because the people *believed* in the value of gold, not because
gold has any real value.

> >> The present US system is a "Ponsi" scheme; new funds are used to assuage
> >> new investers, so that
> >> nobody notices that there is no depth. When the real war breaks out
> >> against an oil-funded nuclear
> >> Iran, Pakistan, and No Korea, there will be no funds available to  
> >> fight it.
> >
> > All currency schemes are Ponsi schemes.
> >   
> If they are not backed by specie, I agree. Specie-backed currencies 
> rarely lose value. Look at the Swiss.

Again, this is a belief thing, not anything real. The only advantage of
backing currency with something real is that it encourages the government
to not overspend.
-- 
D. Jay Newman           ! Author of:
jay@sprucegrove.com     ! _Linux Robotics: Programming Smarter Robots_
http://enerd.ws/robots/ ! "Heros aren't born, they're cornered."
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