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Author Topic: Liberty Dollar in New Hampshire  (Read 14001 times)

pk

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Re: Liberty Dollar in New Hampshire
« Reply #45 on: June 02, 2005, 11:35:44 am »

Ok, they have 1, 5, and 10 LD.  What about cents?  Liberty Dollars are still dependent on US dollars.  Liberty Dollars are designed that way.  The value of the LD depends on the price of silver in USD.  They are designed to be "easy" to convert to USD.  Which is good because it's easier for people to use, but what happens if/when the LD is worth more?  Then what?  Everyone will have to learn what the new rate is, and that will make it more complicated.  Imagine trying to tell someone "trust me, this Liberty Dollar is worth 2 US Dollars, so I can buy that $10 item for just 5 LD."  Yeah, I don't think that's gonna fly.  Now tell someone "hey, this is xx ounces of pure gold."  Sounds better to me.

Like I said, LD is great in theory, not so great in practice.
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BlueLu

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

Hmmm.  Even I seem to have been working from old information.  I see that the Merchant and Assoiate rate floats daily now.  I am not sure what implications this has for the way revaluations or "crossovers" work now.

Jason???

On crossovers, as posted earlier:
http://www.libertydollar.org/html/Crossover%2020%20base.asp

While a crossover event could be disruptive, you still were better off, as an ALD holder, when one happened.
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jasonpratt

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Re: Liberty Dollar Crossing Over in New Hampshire
« Reply #47 on: June 03, 2005, 03:02:34 pm »

A few thoughts about the Liberty Dollar and its crossover:

The unique feature of the Liberty Dollar over all other forms of silver and gold rounds available today is its "tie" to the US dollar, which facilitates its use in commerce. (The US silver Eagle has a $1 face value, so it also features a tie to the US dollar -- albeit one that is unusable in commerce.)

Those who say that the ALD should just "float" and become priced on the silver spot value do not understand what the Liberty Dollar is about. There are plenty of silver and gold rounds (ie Sunshine Rounds) that are marked "1 ounce silver" and will function perfectly for those who want that type of product. I have not seen many of those circulated.

One wrinkle of tying to the US dollar is that the dollar is inflating. At some point the tie to it must be "reset" if it is to maintain some level of parity. This requires changing the Liberty Dollar in one of two ways: (1) removing silver content or (2) changing the face value. Essentially these two are the same thing, said different ways.

So the solution cooked up by the Liberty Dollar people is to have a "crossover" event on midnight of the day after the 30-DAY MOVING AVERAGE for silver's spot price crosses $7.50 USD. At that point the face value of the Liberty Dollar (per ounce of silver) will double to $20 from its current $10. This means the Liberty Dollar one-ounce piece will circulate as a $20 FRN instead of a $10 FRN like it does now.

Admittedly this is a mindbending concept. But I have thought about it for probably more time over the last four years than just about anyone and I have concluded that it will work. Of course I could be wrong as this thing has never been done before. Part of the fun of this little experiment is that we are doing things never before done.

Those who think we are somehow robbing people, scamming them, running away with silver, etc. won't be bothered to do some casual research with Liberty Dollar users and find out that they have a long history of successful use of the currency, that the warehouse is audited monthly by a third party, and so forth, so I won't even bother to make the point that they should do that.

Those who feel this represents a type of inflation of the Liberty Dollar itself ("$10 ALD used to buy 1 ounce of silver, now it only buys 1/2 ounce!") should remember that in an inflation, the issuer of the money is the one who is profiting, while in the Liberty Dollar's crossover, the holders of the currency are the ones who profit. What can be wrong when the people using the currency are the ones who get rewarded for their use of it, while everyone else not using it is unaffected?

Jason
www.austinsilver.com
Board of Directors, NORFED, Inc.
« Last Edit: June 03, 2005, 04:22:26 pm by jasonpratt »
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