Archive for May, 2010

May 24, 2010

Gold still the best option to protect agaisnt Fiat paper money

Thomas G. Brown |

Read an article in the Financial Times today by Merryn Somerset Webb about gold just hitting it stride and not in a bubble as many talking heads are discussing. Ms. Webb attributes the drop in the gold price to a reduction in jewelery purchases in India which usually attributes for a large amount of gold purchases in the spring due to holidays. She goes on to say that “Adjust the 1980 high of $850 for US inflation and you get around $2,500-a level only the most bullish are predicting now”

My thoughts are that gold and silver are still the best protection against currency devaluation and monetary uncertainty that we are experiencing not just in the US but around the world as folks are waking up to the effects of fiat currencies.

Congressman Ron Paul in his weekly column Texas Straight Talk points out the problems with fiat currencies a compares what the US government is doing to Identity Theft. He points out that if we incur a debt with out our knowledge or consent the bank would fully reimburse you of these debts. But if your government go into debt or borrow money without your consent you are forced to pay for it either in direct taxing or more likely an inflation tax in the creation of new money out of thin air.

A great quote about paper money came from George Washington “Paper money has had the effect in your state that it will ever have to ruin commerce, oppress the honest, and open the door to every species of fraud and injustice.”

Hell even Bill Clinton stated to Bob Schaeffer at the Peterson Institute back in April that the monetary problems and the implosion of the financial/banking industry is due to the ending of the Gold Standard.

With all this information pointing to the destruction of the economy being tied to fiat money the fools Congress seem to be in the dark…ah hell these people are clueless. They decided that the new Restoring American Financial Stability Act of 2010is the way to go in terms of correcting and preventing future economic catastrophes. The bill does nothing but expands the powers of the Federal Reserve. Talk about letting the pedophile run the summer camp!

The first step to fixing our economic problems is to do away with the fiat money and bring back Constitutionally (Article 1 section 8&10) sound money in the form of gold and/or silver.

May 23, 2010

Greed would fix Woolworth lunch counter problem

The big uproar over Rand Paul and his comments on the Rachel Maddow Show yesterday. Rachel asked Dr. Paul the Republican candidate for US Senate in KY about his thoughts on comments he made earlier in the day on the PBS Radio show All Things Considered. He basically stated that the Civil Rights Act 1964 was principally good in that it ended government (institutional) discrimination but feels that the government has no right to tell a private business how to run and who they have to serve, admit, or hire.

This at first glance sounds bad but you must look at this more closely than just racialism. The government telling you what you can and can’t do with your own private business or club is just bad for the citizenry.

Just look at the Black, Gay, and Hispanic groups to name a few who admit only members who are similar to other members. Should they have to admit white guys, straight people, or other groups? No, and the same should go for all clubs, groups, and businesses that do not receive government funding.

Now the argument is that if we did not have laws then the lunch counters at Woolworth’s would still be segregated today. This would not be the case. Yes, I’m sure there would be the odd dummy who opens up a whites only restaurant or refuse service to gays, or Hispanics, or any other group. But, if we let the market work it’s magic these businesses would go under. No not all of them, but the great majority of them would be gone with in the first few years of opening there doors. This is because greed or more accurately the desire to accumulate wealth would cause most people to decide that every ones money is good and thus end the decision to discriminate.

Think about it if your losing money running your business cause you fail to serve the needs of your possible customer base your going to change your policies pretty quick. If you don’t well someone else will come along and open a similar business that serves everyone and that will be the end of you.

May 23, 2010

A real Fix in the Banking Industry

Thomas G. Brown

We have one last chance to stop the Restoring American Financial Stability Act of 2010 which just passed the Senate on Thursday the 20th of March by a vote of 59 to 30. This bill will do nothing except allow the Federal Reserve to have more power to print money and give it to banks but also to regulate non-banking financial institutions and break them up if they are deemed a threat. This is confirmed by a quote from a May 20th article in the Economist.

If we want real reform that will prevent the market bubbles and huge crashes there is are a few simple solutions. One would be to first pass the H.R, 1207 Federal Reserve Transparency Act of 2009 . This is the bill by Congressman R-TX 14th District. which is a real audit and not the watered down version that was passed in the Senate. This will put all the backroom deals out in the open and show once and for all that the Federal Reserve only looks out for large banking interest which has a license to steal from the American public.

Once this bill is enacted and we see the malfeasance going on we can take the next step of shutting it down and getting the control of monetary policy back in the hands of the people via the Congress. Then and only then can we get back to a constitutional monetary system backed by silver and/or gold. These powers are spelled out in Article I section 8 & 10 in the US Constitution. I money was backed by gold/silver money could not just be expanded at the flip of a switch. This simple act would have numerous benefits. Cheif would have an easier time saving for retirement. No longer would you have to enter into the stock market and risk your savings on companies and funds that you have only the word of the investment package and rating agencies to go on in terms of it’s risk. You could save your money with little fear of inflation driven devaluation.

When money is tied to a commodity you also make your elected officials work in a fiscally responsible manner. This is due to the fact that they can not just go to the Central Bank and ask them to print more money so that they can pay for legislation and tax folks via inflation. Instead the lawmaker has to ask the American people directly to foot the bill in the form a new taxes. Now we all no what happens when new taxes are discussed by an elected official. They lose their job!

Credit creation i.e. the lending of money to folks would be better managed and less folks would be in debt if we had a true gold standard again. Credit would only be offered to those who could pay for it and the market would dictate the terms of interest. Never again would we have ultra low interest rates that make it more attractive to borrow fund to pay for a house or car instead of saving for these items. Also the value of the money you save in a commodity based monetary system would not be subject to the thief by inflation that currently goes on with our fiat system.

A sound money system is our first step in turning the country around an getting back to a great economic power.

May 4, 2010

Zoning away Property Rughts

Zoning laws must go the way of the dinosaur if we are to regain control of our rights as property owners. To allow the government to tell you what you can or can’t do with what is yours just doesn’t belong in a free society.

An agrument against zoning laws is that they drive up home costs and make affordable housing for working class families unattainable. Just take a look at the comments from an article I found in the MetroWest495 Biz by By Brandon Butler

“The downside is some people believe it will bring in much lower-cost housing, and there’s a concern by some neighbors about what that would do for the community,” he said.

A number of other communities have already embraced the “cluster” zoning model. Patrick Reffett, Natick’s community development director, said within the last few years zoning bylaws have been changed in Natick to preserve open space and allow for housing developments on smaller lots.

“It’s the idea of allowing increased density, with the offset that you get much greater levels of contiguous open space,” Reffett said. “It’s a good trade off in my estimation.”

The argument against smaller lots is that smaller, less valuable homes will not collect as much tax revenue. But, Reffett said, that argument can work the other way, too.

The developer wanted to build smaller homes and is being told by the zoning board that this would not generate enough taxes for the city! When is it the right of the government to tell you, “sorry you can’t build that way on your own property it won’t make enough money through taxes to satisfy us, please try again.”

Below is another example of the poor use of zoning laws. This time the article is from Lancaster, PA and deals with a proposed Solar farm. When energy cost are rising and the need to move away from foreign energy dependency the Planning Commission of East Drumore reject the building of this solar farm as it is to be build in a non-commercially zoned area.

On April 26, the Lancaster County Planning Commission unanimously recommended that East Drumore officials reject zoning changes requested by Community Energy to allow the company to build a solar farm at Route 272 and Deaver Road.

Now, I’m not sure if your familiar with solar panels but they have to build in areas where they can be exposed to the most sun light. The site being considered to build on is referred to in the article as prime farmland. Well, I’m guessing what makes the area great for farming is it’s sun exposure. To stop this project from commencing do to a zoning issue is only a bad idea economically. But also is an infringement on property rights as a person has the right (or should) have the right to do as he or she wishes with property they own as long as it does not harm others or infringe on their rights.

In addition to these two examples zoning laws gear commercial property purchases toward big business over mom and pop stores. When a specific area is designated a commercial zone the cost of property in that area usually rises which makes it near impossible for a small locally owned shop to enter the market without going into substantial debt. Just look around your own town or city. How many locally owned restaurants have come and gone in contrast to the big chains like McDonald’s, TGI Friday’s, and others like them.

The argument that zoning is needed to keep nuances out of neighborhoods such as having an oil refinery in your backyard or a strip club across from a school. In both cases this would be impractical for both of these businesses. The refinery would have a hard time finding enough land at a reasonable price to set up shop right in a neighborhood. As for the strip club next to a school it just wouldn’t be economically feasible for another reason. Number one I would assume dads wouldn’t want to be seen going in and out of this establishment by little Johnny and Janey. Also, other folks in a neighborhood would not want to be scene by their neighbors frequenting this business.

Stop the land police today and abolish zoning laws.

Zoning is bad for the economy and bad for property rights.