so, what is YOUR confidence in the banking system?

Student Lounge College Life
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I read a ton of online articles and watch the news like everybody else and Im pretty sick of the media telling Americans that they are safe. Sure we have the FDIC, which is fine and dandy, but what people don't realize is that when we go into hyperinflation(which we may be in already or close to, depending on which economist ya talk to) and the dollar isn't worth anything, your money is not backed by anything. So it doesn't matter what goverment agency will back you or protect you because they are as good as nothing.</p>

<p>So I have absolutely zero confidence in a fiat currency and even less in the fractional reserve system. I had zero confidence when we are at our peak, because the decline is always a guarantee with such a system.

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<p>Most economists who are worth their salt say that inflation isn't really an issue now since the economy is going into a recession. The fed has cut interest rates dramatically and indicators for inflation have not risen significantly. The only thing that has gone up significantly in the past year is the price of food, all whilst oil has slid to under 70$/barrel. The fed has also historically been an inflation hawk so you can be sure that it is watching inflation monitors very, very closely, especially since they lowered the rates as much as they did. </p>

<p>You obviously know nothing about the government because if fiat currency were worthless and useless, then you can be sure that the government, along with every other single government in the world would fail. And then you can sure as hell bet that money won't be the only thing that's on your mind. Government backed securities have risen dramatically in their value for a reason - because the vast majority of professionals have faith in the United States government. </p>

<p>If you don't then that's great for you. You can take your money out of Citibank along with futurenyustudent, convert it to gold, and move to Antarctica to trade with the penguins.</p>

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Actual marginal utility is different from perceived marginal utility. Often, they tend to match quite closely (especially since if you like fudge cake for example, you yourself know best how much you'd like), but a higher price of a stock because of increased resale volume does not in fact increase the marginal utility of that stock.

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<p>So if I have one share of stock, and I can sell it for $5... you are telling me it is not worth $5? Is that really your argument?</p>

43

<p>
[quote]
I read a ton of online articles and watch the news like everybody else and Im pretty sick of the media telling Americans that they are safe. Sure we have the FDIC, which is fine and dandy, but what people don't realize is that when we go into hyperinflation(which we may be in already or close to, depending on which economist ya talk to) and the dollar isn't worth anything, your money is not backed by anything. So it doesn't matter what goverment agency will back you or protect you because they are as good as nothing. </p>

<p>So I have absolutely zero confidence in a fiat currency and even less in the fractional reserve system. I had zero confidence when we are at our peak, because the decline is always a guarantee with such a system.

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<p>trade your money for a precious metal then...</p>

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So if I have one share of stock, and I can sell it for $5... you are telling me it is not worth $5? Is that really your argument?

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<p>Someone sells you a video that tells you how to make money from home for 99 dollars. You make a decent buck by reselling other videos for 99 dollars to other people .... </p>

<p>But if that marginal benefit can be realised only with resale, that the video itself has no "inherent" value. It has no real marginal utility.</p>