On Fri, 22 Jun 2012, Alex Hutton <highspeeddub@gmail.com> wrote:
A free market does not require that people behave as perfectly rational actors who always act in their own best interest.
A free market requires regulation. Every time you make a transaction you rely on the ability to trust the other party or parties involved. That ability is granted by legislation and government enforcement mechanisms. Such regulation is essential for anyone who wants to charge high prices for their goods and services. Otherwise you just have the "market for lemons" because most buyers expect to get low quality goods and won't pay for quality when they don't expect to get it.
The point is, people who act contrary to their best interests will face consequences that are contrary to their best interests. And if they choose to improve their actions they will improve the consequences of their actions.
Alternatively "conservative" Americans can just keep voting Republican and allow things to keep getting worse. There was an interesting interview on youtube with an insane Tea Party woman who was campaigning against health care reform. It turned out that her husband had no health care...
Rohan McLeod wrote :
-the consequence of globalisation is to move jobs to places with low labor costs and raise unemployment elsewhere. -the consequence of inadequately regulated stock-markets are non-productive booms and busts there is a longer 'rant' here: Those two points are largely due to fractional reserve lending, central banking and fiat currency. All of which are forms of intervention in the market by governments.
http://en.wikipedia.org/wiki/Gold_reserve The US has a stockpile of 8,133.5 tonnes of gold worth about $495B. http://en.wikipedia.org/wiki/Circulation_(currency) The US has $850.7B in circulation, so they would need to almost double their gold stockpile to have a gold backed currency. The other countries in the list seem to have a worse ratio of gold stockpile to circulating currency. Apparently about 1/5 of the gold mined in the entire history of the human race is in government stockpiles. If all current currency reserves were backed by gold then the stockpiles would total 69720 tonnes or 42% of all gold ever mined. Then with a fixed gold price the mining companies wouldn't be able to vary their output according to supply and demand and the gold production would entirely cease when mining costs increased above the fixed price of gold. Of course there is also the issue that the vast majority of the financial world doesn't deal with even paper money. Cash is the small-change of the financial system. Stockmarket booms and busts would not be affected by a gold standard because they don't deal in hard currency anyway. The gold standard only worked for a pre-industrial world. But it's also good for distracting people who know that the current US system isn't working and who otherwise might create political pressure for some problems to be solved. -- My Main Blog http://etbe.coker.com.au/ My Documents Blog http://doc.coker.com.au/