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Thread: Maybe I should start charging my prices in gold and silver

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    Default Maybe I should start charging my prices in gold and silver

    Hi ladies,

    Well, as I plan to start my adult entertainment business and everything, (selling videos, escorting, charging for Skype), the value of the USD is falling due to the Fed's machinations, and Iran has recently decided not to accept the USD for oil, which will devalue the USD even more.


    At first I could charge in USD, and use that to accumulate gold and silver bars and coins. Then I could start listing my prices in gold and silver, and offer to lease them the gold and silver needed to pay my fee for 0.75% per month. Like if they buy a service that costs 1 oz of gold (like a weekend or something), I could lease them the gold needed to pay me, and they pay me the 3.359% of the daily spot rate of gold in USD every day until the end of the 30 days.

    Or something like that. Then I can earn a return from my gold and silver holdings, plus accumulate hard currency. Yes, gold and silver is money, and the lease rate is the interest on it.

    Would this be workable?

    Lexi

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    Banned Melonie's Avatar
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    Default Re: Maybe I should start charging my prices in gold and silver

    ^^^ this would be a paperwork nightmare !!! Basically, under a strict interpretation of SEC rules, you would have to do the same sort of accounting for each customer as stockbrokers must perform for clients who purchase stocks / bonds / commodities ... cost basis, short term capital gains / losses if the price moves during the month, etc. Great concept, though !!!


    Like you, I'm a firm believer that physical gold and silver are 'real' money ... and that every girl should own some as a hedge against SHTF.

    Also, like you, I'm increasingly concerned that the direct currency swap agreements being put in place by Russia, China, Iran ... as well as some traditional US-friendly countries ... is slowly but surely chipping away at the US dollar's status as the world's 'reserve' currency. Most people have absolutely no idea how much the US dollar's 'reserve' currency status actually benefits the USA, US banks, and US citizens in terms of increased 'purchasing power' and 'exporting' inflation !!! Also, the US dollar's 'reserve' currency status is the basis for the highly beneficial PetroDollar system which effectively depresses US interest rates. If the US dollar's 'reserve' currency status is successfully challenged, SHTF time will almost certainly follow.

    See for a 'less than objective' but nonetheless valuable discussion of America's 'reserve' currency advantages ... which are being increasingly challenged.


    (snip)"Today, the main reserve currency in the world — used for the buying and selling of energy, resources, and other international trade, as well as a store of purchasing power for governments, corporations, and international institutions — is the United States dollar. Over 60 percent of countries' monetary reserves are held in U.S. dollars.

    This demand for dollars means that the international monetary system today is highly beneficial to the United States; French President Valery Giscard d'Estaing called these advantages America's exorbitant privilege. What are these privileges?

    First, because dollars are the medium of exchange for buying resources and energy in international markets, it guarantees America easy access to resources like oil in international markets because unlike other countries like Argentina, the U.S. can never run out of dollars.

    Second, it creates demand for the dollar as a trade good — other countries need dollars to participate in the international trade system, and other countries get dollars by exporting goods and services to the United States. Considering it costs the U.S. very little to produce dollars, this demand gives the United States a kind of free lunch on other countries' exports.

    And third, it creates a strong market for U.S. debt. The world's need for dollars has allowed the United States government as well as American firms and individuals to borrow at lower costs, granting them an advantage estimated to be in excess of $100 billion per year.

    There is no international law that explicitly decrees that dollars should be used as the world's reserve currency. It has just come about because the United States is the biggest economy and for most of the last century, the United States was a world leader in trade and a military superpower"(snip)


    Stated very bluntly, 'reserve' currency status currently allows the USA, and US residents, to trade newly printed pieces of green paper for oil, food, consumer goods, i.e. anything which other countries export. If that 'reserve' status is lost, like most other countries, the USA and US residents would be forced to trade something of 'real value' in exchange for imported oil, food, consumer goods etc. - with those pieces of green paper then only being worth what the rest of the world says they're worth. The problem, of course, is that comparatively few US residents have anything with a significant amount of 'real value' to exchange, and that the US economy produces far less in the way of 'real value' goods that people in foreign countries want or need than it used to.
    Last edited by Melonie; 07-23-2014 at 04:27 AM.

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    Default Re: Maybe I should start charging my prices in gold and silver

    Maybe I should charge in barrels of crude oil? Crude oil actually has a real value, as you can use it for things. And gold and crude oil, the physical items, not the derivatives, are considered property, are not not regulated under financial laws.

    And of course, there's always the risk that the US Mint or criminals could debase the gold coins and bars with tungsten, which has almost the same density as gold, and can only be detected by fire-assay or X-ray fluorescence spectroscopy. So actually, even a gold standard doesn't prevent the government inflating the currency. What it does do, however, is create the possibility of deflation.

    But, a gold standard with 100% reserve requirements on demand accounts would be better than what we have going on. Just need to figure out how to prevent deflation.

    Now, an energy-backed currency would be even better because energy is actually a meaningful measure of cost in producing goods and services.

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    Default Re: Maybe I should start charging my prices in gold and silver

    an energy-backed currency would be even better because energy is actually a meaningful measure of cost in producing goods and services
    Arguably, this is the de-facto current situation regarding PetroDollars. Unfortunately, the oil that provides ersatz backing for US Dollars is actually owned by the Saudi's not owned by the USA ... who in turn had chosen to 'invest' the surplus proceeds of their oil sales into US dollar denominated treasury bonds and other US dollar denominated assets and investments. And that arguably leaves the US dollar rather 'vulnerable' as other oil producers like the Iranians, Venezuelans etc. start to price / transact oil in currencies other than the US dollar, and start to 'recycle' their trade surplus yuan, euros, yen, rupees etc. into non US dollar denominated gov't bonds, assets and other investments.


    Last edited by Melonie; 07-23-2014 at 06:37 AM.

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    Default Re: Maybe I should start charging my prices in gold and silver

    Quote Originally Posted by Melonie View Post
    Arguably, this is the de-facto current situation regarding PetroDollars. Unfortunately, the oil that provides ersatz backing for US Dollars is actually owned by the Saudi's not owned by the USA ... who in turn had chosen to 'invest' the surplus proceeds of their oil sales into US dollar denominated treasury bonds and other US dollar denominated assets and investments. And that arguably leaves the US dollar rather 'vulnerable' as other oil producers like the Iranians, Venezuelans etc. start to price / transact oil in currencies other than the US dollar.


    No, I meant more like a currency that is backed by kilowatt-hours of electricity. http://www.energybackedmoney.com/

    We could simply have the government guarantee a price of electricity of say $0.20/kWH, and have a desired range of $0.10-$0.15/kWH. When the price of electricity is below $0.10/kWH, the government can reduce taxes to introduce currency into the economy. If the price of electricity rises above $0.15/kWH, the government can increase taxes and cut government spending to remove the excess currency.

    If the price of electricity goes above $0.20/kWH, the people will have to buy electricity at the market rate with the understanding that the government will reimburse them for the difference between the market rate and the government guaranteed price.

    We'd have to subsidize the installation of the equipment needed to do load-balancing so people with solar panels can actually put their electricity on the grid.

    This will encourage the development of higher ERoEI electricity production methods, like liquid fluoride thorium reactors, hydroelectric, wind, etc., and really put costs into perspective.

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    Default Re: Maybe I should start charging my prices in gold and silver

    due to the SW politics ban, I can't really make a meaningful response to this.

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    Default Re: Maybe I should start charging my prices in gold and silver

    Quote Originally Posted by Melonie View Post
    due to the SW politics ban, I can't really make a meaningful response to this.
    We're not talking politics, we're talking economics.

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    Default Re: Maybe I should start charging my prices in gold and silver

    ^^^ well, for better or worse, in situations where gov't must become heavily involved as an active market 'participant', in situations where gov't edicts are required to overcollect revenues from certain people and then transfer those revenues to certain other people in order to make the system appear to work economically, etc., there is in fact a huge politics component.

    At risk of getting my 'hand slapped', I'll try to confine this extremely limited response to purely economic issues. Solar power requires that taxpayers / electric ratepayers subsidize the initial purchase price of the hardware and/or subsidize the 'reimbursement rate' effectively paid out to solar panel owners ( vs the actual cost of wholesale electricity it replaces ). Solar power requires that taxpayers / electric ratepayers also subsidize the costs of 'load-balancing' ... which essentially involves paying a gas fired generator to maintain spinning but underloaded generator capacity to instantaneously compensate for clouds passing over solar panels. Ultimately, the decision to undertake these additional costs, and to forcibly collect additional money to cover these costs from non-participant taxpayers / electric ratepayers, is a political policy decision not an economic one.
    Last edited by Melonie; 07-23-2014 at 08:18 AM.

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    Default Re: Maybe I should start charging my prices in gold and silver

    Well, this is why we need to invest in thorium reactors and flywheel energy storage. Storing the energy from solar in a flywheel would offset the loss of production during nights and cloudy days.

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    Default Re: Maybe I should start charging my prices in gold and silver

    ^^^ well, at least we appear to agree on the 'virtues' of additional nuclear power ... regardless of the particular fuel used.

    However, this has drifted far from the original topic ... which arguably was the 'real value' of gold and silver versus the 'apparent value' of green paper.

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    Default Re: Maybe I should start charging my prices in gold and silver

    Gold has been trading below $1100 an ounce. Silver is well below $15 an ounce. And the dollar is strong. Hmmmm.

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    Default Re: Maybe I should start charging my prices in gold and silver

    ^what goes up, must come down.

    China is steady selling t bills. There is chatter of a new reserve currency. Then, bye bye dollar.

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    Default Re: Maybe I should start charging my prices in gold and silver

    Quote Originally Posted by GlitterButterfly View Post
    ^what goes up, must come down.

    China is steady selling t bills. There is chatter of a new reserve currency. Then, bye bye dollar.
    I dunno. There has been chatter about setting up a new reserve currency to replace the dollar for quite some time. One problem is that Russia and China who were pushing the idea the most are now hurting financially. Even though they've been selling China still holds a lot of American debt. As do many Russian oligarchs. A collapsing dollar is the last thing they want to see.

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    Default Re: Maybe I should start charging my prices in gold and silver

    Haven't been around here in a while, but I would have put my money on there being a gold thread around when I popped in

    Some news: "Hedge funds are holding the first ever bet on a decline in gold prices since the U.S. government started collecting the data in 2006."
    http://www.bloomberg.com/news/articl...sition-in-gold
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