Saturday, July 14, 2007

Quick Note Re: Fiat Currency

Gold bugs (i.e., those in favor of returning to a "gold standard,") historically have annoyed me to no end. The idea that expending capital to dig an element out of the dirt, clean it up, then dig another hole in which to bury the stuff (and hire a security staff to protect it) and then call that "money" has always seemed absurd. "Money" is whatever humans claim can store value: wampum, uncashed checks (e.g., currency in certain parts of Alaska), gold, and, yes, fiat currency (i.e., steadily inflating paper currency). But my goal today is not to rehash my own diatribes against such folk (who have claimed for decades that we are all on the brink of collapse; listen up, buds: post collapse, my shotgun shells will be worth far more than your gold ingots!).

I signed up for obopay ($10 bonus in prepaid MC form) today, which now sits alongside my PayPal and ING accounts (i.e., fully electronic, paperless currency). I have no doubt that the reader of this blog is familiar with PayPal--it's common currency on e.g., eBay. obopay is similar, but for cell phones, that is, one can send and receive currency electronically, immediately. Want to buy that neat thing-o? Point your phone at it and press a button (more or less).

And goldbugs are worried about PAPER curreny? Sheesh. Talk about maximizing "dollar velocity" (G--gle it yourself, lazybones: I'm too busy to link EVERYTHING today!).

This may hook up with my other pet theory: that dollar velocity is so high that perhaps we have seen consumer-related mini-recessions; they've just been so quick we haven't noticed.

Various segments of the economy are driving at vastly different speeds, currently. You want to have a surge in Iraq? That'll cost you six months. You want get Tasty Bite lunches at your office? (Use promo code "WL20" for a 20% discount, btw.) Even with the free shipping it is delivered the next freakin' day. You want to understand the iPhone? It was deconstructed before you ever got yours. There's a Bandolier of Carrots over at W00T! you say? It sold out before you could even refresh your screen.

So, maybe the subprime market has already recovered, absorbing the losses and redistributing the risks before the consumer could even remember to refinance the HELOC. Maybe the coming dissolution of GM won't be as bad as we assume (save, of course, for Roger Moore's disgruntled peeps). Maybe the de-equitization of law firm partners will be good at the macro level (despite what it does for stress levels and heart disease of us working stiffs).

Jumbled post and lots of thoughts that, as usual, lack clarity, definition, and destination. Sorry. Feel free to rewrite my thoughts as you see fit.

1 comment:

daniel said...

Here is a website that gives a report on Fiat Currencies that i thought i was pretty good also...

Fiat Currencies