what happens to the BTC in their wallets that they didn't lose? Liquidated to pay creditors 1c in the dollar?
with 63 million in debt, I imagine customers aren't first class debt holders either?
324 karma · joined September 3, 2010
with 63 million in debt, I imagine customers aren't first class debt holders either?
NoWin, Nancy, SignalR & Lego on the raspberry pi:
eh? currency then or now? Currency then was on the gold standard so the two didn't fluctuate. Currency today, they target inflation of 2% / year by design.
re: insane price of collectibles
You are thinking like a salaryman. Think of one of great wealth with a flow of currency more than what one can sensibly spend money on - the market for these coins. The pleasure gained from owning the 20th rolls is not the same as the first. The utility gained less so. How about a rare collection of gold coins from 1850? Now that is something you can talk about over some cognac and cigars with a like minded fellow. An object of beauty, desire and a fantastic store of value for when you want to transport value across to the next generation. Alternatively, you could park $10 million into a hedge fund and swap spreadsheets around the fireside chat - debating which manager was best defending the onslaught of the fed and its money printing? Which one is less - shall we say - vulgar?
Executive Order 6102 required all persons to deliver on or before May 1, 1933, all but a small amount of gold coin, gold bullion, and gold certificates owned by them to the Federal Reserve, in exchange for $20.67 (equivalent to $372.75 today[3]) per troy ounce.
The United States Gold Reserve Act of January 30, 1934 required that all gold and gold certificates held by the Federal Reserve be surrendered and vested in the sole title of the United States Department of the Treasury.[1][2]
The Gold Reserve Act outlawed most private possession of gold, forcing individuals to sell it to the Treasury, after which it was stored in United States Bullion Depository at Fort Knox and other locations. The act also changed the nominal price of gold from $20.67 per troy ounce to $35.
The price of a collectable is because someone else (not necessarily you) values it. And the odds are that many other wealthy collectors would value it at the same price, allowing the buyer to hold it and then trade it later for similar value.
Meanwhile will the rest of the world be willing to ship real goods and services in return for promises of ever more paper IOUs from the USG, and when those paper IOUs are due, the promise of even more paper IOUs?
If this all sounds sustainable, I have a deal for you. I want to borrow $100 off you and I'll pay you $105 next year. Don't worry, I'm good for it. I'm also lending myself $200 and will pay myself back $210 next year. So how about it? Clearly the 5% interest rate is what has been set by the market (me) so you are getting a good deal.
Next year comes around and I hand you some paper IOUs for $110 the next year. Meanwhile, I'll borrow another $100 off you. I've been living it large and need a bit more sugar. Don't worry, I'm good for it - I'll lend myself another $200 too!
The USD being world reserve currency has been printed far beyond the needs for internal domestic trade. The US had to do this to lubricate world trade, however when the music stops all those dollars held in foreign banks will try and make their way home in order to obtain some value. A flood of dollars will then start bidding for goods and services from the US economy. Instant hyperinflation.
The US haven't defaulted on their debt because the roll over their debt with more USD.
So no, it wouldn't be business as usual...if this were a real story.
Paper money is backed by the willingness of other people to price their goods and services in it. If people stop pricing their goods and services in it then it is no longer money. eg: a Zimbabwe dollar is no longer money. No one will exchange anything for it except for a novelty value.
Generally vendors exchange those paper monies for goods and services due to the requirement to pay taxes in fiat dollars. Vendors aren't required to sell for dollars, they can sell for whatever medium of exchange they want. It's just convenient to do so due to the tax reason. That reason alone can't save a currency though. eg: $Zim.
Much like DPR and silkroad.
Yuan, gold, silver or bitcoin?
Hint: Bitcoin and silver are not held by central banks as assets. Yuan's value is subject to the policy of China's politburo. Fool me once on the USD...
That leaves one asset that can't be printed into existence: http://www.ecb.europa.eu/press/pr/wfs/2013/html/fs130924.en....
As world reserve they have had to spend into existence a metric craptonne more currency than their economy requires in order to lubricate world trade (google Triffins dilemma).
ie: For Turkey (say) to buy oil off Saudi, they need to sell something to the US in order to obtain USD first. When world reserve status is lost, suddenly Turkey doesn't need USD in order to acquire oil. The rest of the world is holding USD for trading purposes and those USD currently never go home in order to claim something from the US economy.
Now lets turn the lights off on USD as world reserve: Those now useless trade dollars will try and find their way home to the US and start chasing things milk, eggs, cars...anything in the real world that has value as the currency devalues. Meanwhile, the USGovt is having trouble acquiring its goods and services with its rapidly inflating USD and doubles down on printing under Executive Order 13603.
When this one blows, one doesn't want to be caught holding assets denominated in USD.
In essence, America has told the world that as long as the business of this country is functioning, your wealth, as represented in Marks, Yen, Pesos, etc. is backed with performing US debt. It's like saying, "as long as your neighbor, next door, does not loses his job, you will not lose all your money!
The U.S. Supreme Court is going to hear a campaign finance case that could do away with the contribution limits that limit rich people’s influence over politics.Currently, federal law only lets individuals give $2,600 to any one candidate during a single election.
On top of that limit, people can only give $123,000 to candidates, political action committees, and parties over a two-year period.
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