You really filled my head with doubt!

Now I’m just not going to bother voting for Ron Paul at all.

You can go back to Clinton headquarters and tell them you have made one convert. Job well done!

rotten reagan asks “really?”

Yes, really. Of all the historical events you bring up, can you find one in which people weren’t trading some form of money substitute?

Here’s the way it typically works: Banks would store people’s gold and issue receipts for gold on deposit. These receipts were called bank notes. People would trade these bank notes in place of the gold. (You used to have to pay the banks to store your money, because in theory they used to have to actually store it.)

The banks came up with a scam where they would issue more receipts for gold than actual gold on deposit. The banks would make money by lending out money or making investments with money that didn’t really exist. A recession is when all this artificial debt is called in at the same time and there isn’t enough ‘real’ money to cover it all.

Here’s the reason none of this has anything to do with genuine free-market capitalism: In a free market, banks would have to compete with each other for the trust of their depositors. People would only accept bank notes if they thought they were very likely to be able to redeem them for actual money. Banks which lost the trust of their depositors would suffer a bank run and go out of business. And this is as it should be.

But the bankers who happened to be the most politically influential would team up with the government to come up with ways of forcing people to use the favored bank’s notes in place of gold. A bank would be granted a monopoly on bank note issue. The government would demand that taxes be paid in the favored bank’s notes. The government would force people to accept the notes in place of gold for payment of debt (legal tender laws). The governments would grant these political privileges in exchange for financing government debt, typically to wage war.

Now that we have fiat currency, there is nothing that holds banks and the government back from printing money out of thin air except for the concern that they will destroy the economy in the process. It’s happened before.

There’s lots more on the topic in the previously referenced source.

Obviously, Ron Paul’s the REAL fascist here!

It’s good to see you shills for mass-murder and corporate tyranny liberals have your priorities straight.