Quote:
Originally Posted by Undertoad
We just have faith that it'll never happen to us, and it's that faith that ACTUALLY makes us believe in the dollar's value.
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Well proven history that demonstrates why the dollar is so stable. TARP was a perfect example. American central bankers told big banks, "You have eight hours to save the economy." How many emotional types saw that coming? None. People who learn facts and numbers (we all now know) were correct. What they did is why the American dollar is so stable and respected. Backed by people and an economy that uses facts (not emotions) to make decisions.
That is also why a Central Bank must be independent of the emotionally naive such as George Jr.
This last recession (that was almost a great depression) was created by a scarcity of equity. A massive and dangerous problem was solved by pumping $700 billion into the economy. Scarcity (in this case) almost destroyed economic activity (as it did in 1929). Also critical was where $700 billion was injected. Done so responsibly that we undid massive economic damage that started mostly about 2000.
A great depression averted by those who are not emotional - who made decisions from facts, numbers, and logic. That is why the dollar is trusted.
Emotion may have created those problems when people foolishly 'felt' Social Security should be in a stock market, commercial banks get into investment banking, sub-prime loans to create SIVs and CDOs even without open markets, that derivatives can make everyone richer, stock brokers promoted as informed investors, golden parachutes and other massive payments to top executives, 'buy American', and spending almost $3 trillion on Mission Accomplished. Stupidity was created by the emotional who also believed an emotional myth called trickle down economics.
The emotional create problems. Stable currencies exist when the emotional are disempowered. Stability of the American dollar is found in so many companies that do not exist for profits - and therefore have profits. And by the educated and logical who control, protect, and define that transactional medium.
The emotional and naive created a gold Dinar. Using their emotions, that Dinar should be a world's most stable currency. It is not because facts and numbers, necessary to have a trusted Dinar, do not exist. These people are so emotional as to even claim that banks create evil. Emotion does not define a stable currency. Emotion can undermine a currency. Facts, numbers, logic, statistical history, and educated people make possible a stable currency.