World Collapse Explained

[T J]

This puts things into perspective... and the fact it's the bald faced truth is even funnier.

http://www.ibtimes.com/articles/20100529/world-collapse-explained-inminutes.htm

 

[Mary Ann]

"Because it's owned by China"

 

[auntiehill]

Oh, God. The entire world economy is one, giant version of "Who's on First."

 

[Amaris]

It is a bit sobering, isn't it?
Perhaps we should take a page from Judaism and have a year of Jubilee, where every debt is forgiven and we start over.

 

[B.J.]

Oh, God. The entire world economy is one, giant version of "Who's on First."

It sounded like that to me too!

 

[GeorgeKirk]

What's even more ridiculous is what these "dollars" represent. No one is on the gold standard anymore, so money only has value because we believe it does! Dave Barry once compared it to that scene in Peter Pan where we're told that Tinker Bell will come back to life if we just believe hard enough. That's our financial system! It's the Tinker Bell system! And we thought the cattle-based monetary system of ancient times was silly.

 

[Small White Car]

What's even more ridiculous is what these "dollars" represent. No one is on the gold standard anymore, so money only has value because we believe it does! Dave Barry once compared it to that scene in Peter Pan where we're told that Tinker Bell will come back to life if we just believe hard enough. That's our financial system! It's the Tinker Bell system! And we thought the cattle-based monetary system of ancient times was silly.

It's not like the gold standard is any different. Gold only has a certain value because we say it does. It's the same "Tinker Bell" phenomenon, really.

ANY economy is going to be based on faith. The instant a farmer stops cutting his own hair to spend more time growing food then he is proclaiming faith in the idea that someone else will be willing to cut his hair in exchange for food at some future point. He's putting faith in the system.

There's really no way around it.

 

[propita]

Hilarious! Pathetically sad, but spot on and hilarious!

 

[T J]

It is a bit sobering, isn't it?
Perhaps we should take a page from Judaism and have a year of Jubilee, where every debt is forgiven and we start over.

Great idea! I wonder how that would work out? For some reason my guess would be in fire...

 

[Admiral Shran]

Yeah, that pretty much gets to the heart of the matter.

 

[Bloodwhiner]

Who needs a semester of economics? That summed it up perfectly.

I sent it to my financial consultant.

 

[FordSVT]

Brilliant, and very funny as well.

And sad.

The circular nature of the entire world economy is wierd.

Everyone borrows from everyone else, and China lends to everyone else, but China can only lend to everyone else because everyone else's population buys their cheap shit instead of making their own. It's like our own money is being siphoned through China like they are some kind of financial middle-man.

 

[John Picard]

"Because it's owned by China"

That's everyone's answer. Local store down the street goes out of business -- "EVERYTHING IS OWNED BY CHINA!!!"

 

[TheGodBen]

It is a bit sobering, isn't it?
Perhaps we should take a page from Judaism and have a year of Jubilee, where every debt is forgiven and we start over.

As a citizen of a heavily indebted country that is only going to get more indebted over the coming years and which has no long-term plan for paying the money back... I like this idea!

 

[JiNX-01]

Oh, God. The entire world economy is one, giant version of "Who's on First."

No it isn't. "Who's on First" is funny.

 

[Holdfast]

ANY economy is going to be based on faith. The instant a farmer stops cutting his own hair to spend more time growing food then he is proclaiming faith in the idea that someone else will be willing to cut his hair in exchange for food at some future point. He's putting faith in the system.

There's really no way around it.

+1

All economies are fundamentally built upon debt of one form or another. That's the whole point of a market/trading economy. You offer services in return for payment, and there's always some delay between the service being carried out and the payment being received. The more complex the system, the more opportunity to merry-go-round the payments.

This is precisely what holds the international economy together. It's a GOOD thing - by being tied together in a free market, it becomes incredibly difficult for any one major country to go to war with another, for instance. Faith in debt = enforced world peace through financial imperatives. Why do you think we haven't had a proper world war recently? No major country can afford it anymore. Crash one part of the system, the whole patchwork quilt goes down. Even dealing with the recent financial crash has put most major economies worldwide under immense strain.

And for those thinking China doesn't depend on debt? It bankrolls its own economy by artificially maintaining the yuan at a low level. That's a VAST debt that will eventually have to be repaid when it allows the currency to float. And it will eventually have to do this; the only way it avoids it at the moment is by buying OTHER people's debt, which is more dangerous for them actually, as it means their economy becomes DOUBLY dependent on foreign economies. Essentially, by suppressing the yuan and using the money to buy foreign debt to sustain this, China is paying other countries to buy its goods. Not exactly a smart move, in the long term.

Anyway, it's true that the more complex the system, the more finely tuned it becomes, and the more potentially fragile it becomes. The challenge is to ensure the debts can be moved around more efficiently and most importantly, more clearly. The problem with CDOs and the like was that it was impossible to actually SEE the details of the debt you were buying. Due diligence went out the window. If people knew what the debt actually was, it would have been priced much more correctly and the crisis wouldn't have happened.

 

[Rett Mikhal]

What's even more ridiculous is what these "dollars" represent. No one is on the gold standard anymore, so money only has value because we believe it does! Dave Barry once compared it to that scene in Peter Pan where we're told that Tinker Bell will come back to life if we just believe hard enough. That's our financial system! It's the Tinker Bell system! And we thought the cattle-based monetary system of ancient times was silly.

It's not like the gold standard is any different. Gold only has a certain value because we say it does. It's the same "Tinker Bell" phenomenon, really.

ANY economy is going to be based on faith. The instant a farmer stops cutting his own hair to spend more time growing food then he is proclaiming faith in the idea that someone else will be willing to cut his hair in exchange for food at some future point. He's putting faith in the system.

There's really no way around it.

I'd have to disagree with you there. Gold Standard is a bit more real because gold is tangible and useful. The fact it is precious is irrelevant, the real important thing is it can be stored for long periods of time without maintenance since it doesn't oxidize readily.

Paper money on the other hand, is completely and utterly arbitrary. It's just a number stamped onto a piece of cloth, and one piece of cloth is no more useful than any other. A twenty dollar bill is not twenty times stronger than a one dollar bill except in the system we invented. Twenty gold bricks are twenty times more useful than one gold brick.

 

[MANT!]

Besides..gold is SHINEY!!!


God are we really no better than a bunch of raccoons?

 

[John Picard]

What's even more ridiculous is what these "dollars" represent. No one is on the gold standard anymore, so money only has value because we believe it does! Dave Barry once compared it to that scene in Peter Pan where we're told that Tinker Bell will come back to life if we just believe hard enough. That's our financial system! It's the Tinker Bell system! And we thought the cattle-based monetary system of ancient times was silly.

It's not like the gold standard is any different. Gold only has a certain value because we say it does. It's the same "Tinker Bell" phenomenon, really.

ANY economy is going to be based on faith. The instant a farmer stops cutting his own hair to spend more time growing food then he is proclaiming faith in the idea that someone else will be willing to cut his hair in exchange for food at some future point. He's putting faith in the system.

There's really no way around it.

I'd have to disagree with you there. Gold Standard is a bit more real because gold is tangible and useful. The fact it is precious is irrelevant, the real important thing is it can be stored for long periods of time without maintenance since it doesn't oxidize readily.

Really? I love hearing the "BUY GOLD NOW" people who claim that chaos is around the corner. If you don't own gold, then when the financial markets collapse you won't be able to buy anything, HYPE/SCARE/REPEAT.

To prove this, go to wherever the next big natural disaster occurs -- flood, tornado, etc. and then try to trade people gold for goods. It won't happen. Why? Because it's NOT useful. In that scenario, people resort to the basic bartering system of food, transportation, water, gasoline etc.

Paper money on the other hand, is completely and utterly arbitrary. It's just a number stamped onto a piece of cloth, and one piece of cloth is no more useful than any other. A twenty dollar bill is not twenty times stronger than a one dollar bill except in the system we invented. Twenty gold bricks are twenty times more useful than one gold brick.

And yet the paper money does have value. If you have a $20, $50, or $100 bill readily available at this moment, take that bill and burn it. Go on, burn it.

I bet you didn't. Why? Because it apparently does have value. Humping around a bunch of gold isn't going to make someone any more wealthy or more powerful than the next person if there is no demand for gold. Gold prices right now are inflated. If value is the argument, then look into such elements as platinum, palladium, and even silver.

 

[Holdfast]

The arguments about gold's inherent value will rage forever. Goldbugs tend to be quite fervent in their appreciation for the yellow metal.

I prefer to consider it simply a commodity. Just like any other commodity, it has some intrinsic value because of its scarcity and difficulty of extraction. That cost value is higher than many other commodities simply because of the high cost associated with finding/extracting it. That "cost" value is then modified by current demand for it, just like any other commodity does.

The idea that gold (or any other metal/resource) is immune to supply/demand considerations (esp. in a post-apocalyptic scenario) is just bizarre and I take issue with the goldbugs on that point.

But what the gold-skeptics forget is that money (or rather, your local variant of it) is also subject to supply/demand considerations.

At some points in time, the supply/demand considerations favour money, at other times, gold. Money itself is a commodity, viewed in this way.