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Author Topic: Liberty Dollar in New Hampshire  (Read 14003 times)

nessfan

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Liberty Dollar in New Hampshire
« on: May 02, 2005, 11:20:08 pm »

Anyone who is living in NH spend the Liberty Dollar?  Are there many places that accept it and about how much of your spending consists of Liberty Dollars?
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Gabo

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Re: Liberty Dollar in New Hampshire
« Reply #1 on: May 02, 2005, 11:31:55 pm »

I've got liberty dollars!



But I'm not yet in New Hampshire.....



I can't wait to use them once I get there, and I hope many people use them.
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RidleyReport

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Re: Liberty Dollar in New Hampshire
« Reply #2 on: May 03, 2005, 01:50:10 pm »

I live here and have spent them some but really want to spend them a lot more!  need to get around to buying some...
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FTL_Ian

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Re: Liberty Dollar in New Hampshire
« Reply #3 on: May 04, 2005, 10:24:07 am »

Sign up as an associate, and buy them at a discount, then spend them at a profit!

Sign up here:
http://dollar.freetalklive.com

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"Hagrid"

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Re: Liberty Dollar in New Hampshire
« Reply #4 on: May 04, 2005, 11:28:28 am »

Sign up as an associate, and buy them at a discount, then spend them at a profit!

Nothing personal, Ian, but this is exactly why the Liberty Dollar makes little economic sense to me.
If you can purchase it at a discount, then that's the "real" value of the currency, and anything above it is inflated without merit.
 

FTL_Ian

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Re: Liberty Dollar in New Hampshire
« Reply #5 on: May 04, 2005, 11:37:44 am »

It took me a little while to figure out too.  The real value of the currency is what people will trade for it.

The reason the LD is offered to associates at a discount is to give us incentive to spend them.  It overcomes Greshams's Law, which says that in an economy where there are 2 currencies, the one that is worth less will be spent.  For instance:  If you have $20 in greenbacks, and $20 in silver, you are more likely to spend the greenbacks, because the silver is actually worth something.  The discount overcomes hoarding.

Plus, why shouldn't we get it at a discount?  That's how the distribution system works for most currency.  Did you know the big banks buy USDs at a HUGE discount?  Way more than the 5-10% ALD associates make.

Regards,
Ian
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"Hagrid"

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Re: Liberty Dollar is Voodoo
« Reply #6 on: May 04, 2005, 12:43:44 pm »

Economics doesn't quite work like that... despite the best intentions of those who want to...

Say I decide to get involved:
I become a Liberty Associate for $250. I receive $100 Liberty Dollars and my future currency exchanges are @ Associate Rate ($9.22 per $10 right now.)

So I get $100 Dollars for $250 (EEK! That's 40 cents on the dollar, folks) I'm losing lots of money that way...
 In order to break even and get back to par, I must buy just over $1920 Liberty Dollars at a discount.... (if I did my math correctly)
(Let's forget for a second that 10 Liberty Dollars are really only worth $9.22 (or less, see below), because then I'd have to buy even more)

Oh wait, that's right, I can get paid for referrals...

I earn a $100 Referral for every Associate I sponsor.
So now, I can push off my 'debt load' (Remember I'm $1920 dollars away from being break even) to others, and have them become similarly endebted, and make some of my 'loss' back.  I'm opposed to a currency that works by putting others into paper debt to recover the value I lost.

So, let's look at how someone could break this...  Why should I pay $250 for the right to Associate?  John Smith, who is already involved and on the hook, decides to sell me the dollars at a discount at about 1% more than the Liberty Dollar folks do... $9.32 for $10 worth.  Since he pays $9.22, he's making a real profit of 10 cents.  I'm saving $250, so I have no incentive not to purchase at slightly more,  Since that 10 cent difference will only matter unless I purchase $2500 Liberty dollars or more...   And John's making his $250 back the hard way... just using my money to do so.

As for using them at $10... Only those who don't know John is selling them for $9.32, or Liberty Dollar at $9.22, will value them at $10 - Face Value does not equal real value, remember that... The 'real value' is $6.94 (1 oz of silver spot price)
In other words, it's only $10 to those who are uneducated about the market value.  I don't like the idea of currency whose value is purely inflated in the minds of those who don't know better... Sounds like Tulips to me... (and if you don't know the Tulips story, you fall into the 'don't know better' class of people)

Real silver is real money... The Liberty Dollar is inflated... and inflation is the problem, regardless.  As soon as you offer discounted money, the true value of that money drops to the discounted value.   

Gresham's law applies http://en.wikipedia.org/wiki/Gresham's_Law#Good_and_bad_money
and says that Liberty Dollars are just as bad, unless converted to base bullion.  Since I only get $6.94 worth of bullion, that's the real Gresham value of the Liberty Dollar... not $10 or even $9.22

Again from that Wikipedia article: ...in the absence of legal tender laws, Gresham's law works in reverse. If given the choice of what money to accept, people will transact with money they believe to be of highest long-term value. However, if not given the choice, and required to accept all money, good and bad, they will tend to keep the money of greater perceived value in their possession, and pass on the bad money to someone else. Said in another way, in the absence of legal tender laws, the seller will not accept anything but money of real worth (good money), while the existence of legal tender laws will force the seller to accept money with no commodity value (bad money).

Now, for those who are accepting Liberty Dollars (ie they are ignoring legal tender laws (try paying your utility bill or tax bill with LDs), and using non-tradtional tender), they are using LDs because they _believe_ them to be higher long terms (since by definition, they don't believe in the long term aspect of the USD)  However, in the 'real' world, we have legal tender laws, the incentive is to pass along the 'bad money'.  As we determined, $10's worth of Liberty Dollars is really worth $6.94 USD (since I could buy Bullion from anyone with USDs) so I'll choose to spend the _bad_ money (LDs!)... Gresham's law doesn't care, it's still true... If you have Liberty Dollars, you'd rather spend them than keep them...  Discounting doesn't help build the value of LIberty Dollars, it only ensures that you'll get rid of them faster.  By my reckoning, LDs are _bad_ money, not good, and why would I support _bad_ money in any shape or form?

Added as an afterthought:  Just to be clear, the above paragraph is NOT a reason to get involved in LDs (Ie "Oh, you mean people will _want_ to spend them?") but the very opposite: "If I have LDs, I want to get rid of them as quickly as possible".  Buying LDs with USDs is buying worse money with bad... IMHO. (I can't bring myself to called USDs good)
« Last Edit: May 04, 2005, 01:02:56 pm by SethCohn »
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FTL_Ian

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Re: Liberty Dollar in New Hampshire
« Reply #7 on: May 04, 2005, 01:00:27 pm »

Well Seth... we know you're full of interesting opinions.  The ALD may not be perfect, but calling it bad money is totally false.  Sorry, but when faced with two choices for money:

Liberty Dollar: Backed with Silver
FRN: Backed with jack shit

The choice seems obvious to me.  Since you know so much, why not start the SethDollar?  Start competing instead of just talking trash.
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"Hagrid"

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Re: Liberty Dollar in New Hampshire
« Reply #8 on: May 04, 2005, 01:09:41 pm »

The choice seems obvious to me.  Since you know so much, why not start the SethDollar?  Start competing instead of just talking trash.

Seth - Trash Talking Economist!

First, I'd have to start the SethBank (to back the money with 100% reserves).  Our Banking laws here in NH are not yet ready for that.  Give us a few years..  Peter Hildreth is the Banking Commissioner, I've met him already and we'll take it slowly from there, in small steps.

There was talk of setting up a Credit Union in the past... no idea of the status... perhaps one day...  We'd need many more FSPers to move first.

P.S.  Everyone should go read Economics in One Lesson ASAP as a start to fixing things.

FTL_Ian

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Re: Liberty Dollar in New Hampshire
« Reply #9 on: May 04, 2005, 01:16:17 pm »

I'll use whatever currency is best, Liberty Dollar or SethDollar.  Have at it!
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"Hagrid"

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Re: Liberty Dollar in New Hampshire
« Reply #10 on: May 04, 2005, 01:19:37 pm »

I'll use whatever currency is best, Liberty Dollar or SethDollar.  Have at it!

Actually, as I said above, you won't... Unless we repeal the legal tender laws, you'll use whatever currency is _worst_, according to Gresham's Law.

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Re: Liberty Dollar in New Hampshire
« Reply #11 on: May 04, 2005, 01:33:05 pm »

I will consciously violate Gresham's law.   ::)
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jasonpratt

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Re: Liberty Dollar in New Hampshire
« Reply #12 on: May 04, 2005, 02:01:46 pm »

Well, far be it from me to step in as a newbie on this board, but regarding Seth and Ian's discussion about the Liberty Dollar - I'd say Ian's behavior (and Seth's profile comment "We don't need 20k...") both characterize the "Can-do" spirit of some libertarians and are the type of things that get freedom going.

OTOH, Seth's attitude and remarks about the Liberty Dollar are counterproductive to the goal of Liberty and are the same types of comments I hear about the FSP (and regularly rebut)..."it'll never work"..."it's a big scam"... etc. People who are doubters and critics ONLY are not useful to the goal of freedom, but seem to be everywhere on these Internet boards!

Now on to the substance:

Seth - don't become an Associate. Use the currency at face value or whatever you can get it at. It is a free market. You can get the currency for a pretty good discount from time to time, if you're dedicated and resourceful. This is the wonderful thing about the Liberty Dollar - it is a free-market currency.

ALD has no intrinsic "worth." Its worth is what you can exchange it for in the marketplace. That is it. However, it does have a *backing* of 1 ounce of silver, which itself has *value* in an industrial sense. So whether or not you use silver, it is widely used in our economy and therefore it will always be marketable.

So your choice is: 1 ounce of silver or a government promise. When you understand the choice, you will no longer choose the promise. Until then, you'll blindly go on believing that the government is trying to help you. Not you, Seth!?! Say it ain't so!

Finally, on this notion that the currency is only "worth" its silver spot price...what about the good old profit incentive? Should NORFED and all the people who spend their time promoting, talking about, backing up, exchanging, etc., the Liberty Dollar be doing it for FREE? Maybe we should rename it the Altruism Dollar! Heck, no. Profit is the incentive that makes the economy go. I regularly buy 10 cents worth of wheat hops and water in a $3.50 beer. Is the beer only worth the wheat hops and water? No way! The manufacture of beer deserves to be paid. So does the distributor. How is this any different from money? (BTW - your bank has 100% gross profit margins on the money it creates. NORFED has 10% margins at best. Infinite difference.)

Sadly, people believe money is free because they're used to getting it "free" from the government. Just like roads, schools, courts, defense, and everything else that government provides, it is paid for by your taxes, and is done less efficiently that way than it would be done on the free market! Plus the way our money is designed it gives Congress a blank check to borrow all they want without penalty! How is that OK??

Hey Seth - look again. It's not a scam. I've been using it for four years. We have hundreds of places in Austin that take it unofficially, and over a hundred who take it officially: www.austinsilver.com. It works. You can choose not to believe that, but you can't deny the fact that actual trading is taking place TODAY using ALD instead of USD ... each one a positive step towards a freer society!

Now let's get it trading in NH!

Best Regards,

Jason

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"Hagrid"

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Re: Liberty Dollar in New Hampshire
« Reply #13 on: May 04, 2005, 02:21:28 pm »

I didn't say it was a scam, I said it was bad economics.  Big difference.  One is intentional, the other just misguided.

I'm not going to promote or support _anything_ that is bad economics.  That is what got us in trouble in the first place.

It's really interesting to me how many fervent _believers_ in LDs don't understand the most basic of economic principles.
Have you _read_ Economics in One Lesson, have you read Mises?

Believing is not the problem.... You can believe that your lead is worth the same as my gold until the end of the century, and it'll still be lead.

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Re: Liberty Dollar in New Hampshire
« Reply #14 on: May 04, 2005, 02:23:02 pm »

The Liberty Dollar isn't bad.  I'd prefer to see the exchange versus silver higher but there's nothing wrong with it if people find the premium worth it.

When it comes to investing you can have the best of both worlds by using dollars for a convient standard unit of exchange, while protecting against inflation by investing your savings into silver, or something else more tanglible than dollars.  No sane financial advisor would recommend leaving any significant savings in an account without any interest.

As an alternate currency to wean people off the single dollar standard we have, Liberty Dollars do just fine, IMO.

I personally don't see why Liberty Dollars should be taxable either and if someone wanted to claim they were because of the silver ... well they're only ~70% the value in silver ;D  So you write off 30% on your taxes!  That might be worth paying a little bit of a premium for.  Also, consider that the premium is paid once.  Dollars get old and are removed from circulation after a period of time so only have a short term lifespan.  Liberty Dollars don't have that overhead and if they were exchanged often the value of their use versus the premium isn't too high.

Though, until the backing of the dollar is something other than force, the safety of most investments are at risk (even something as tangible as your house or car).

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I'll use whatever currency is best, Liberty Dollar or SethDollar.  Have at it!

There you go :)  That's a plan.
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