US debt default 'by end of month'?

[Jimbuna]

Will this merrygoround ever end?

US Treasury Secretary Jack Lew has warned the US may default on its debt by the end of the month if Congress does not raise its borrowing limit.

http://www.bbc.co.uk/news/world-us-canada-26021640

[Tchocky]

It's not hostage-taking when everyone can see you don't have a gun.

[Platapus]

It seems that it is only an issue when there is a Democrat as POTUS.

[Skybird]

http://www7.pic-upload.de/04.02.14/se7v7rjfzoo7.jpg (http://www.pic-upload.de/view-22161458/Antonio_Il_Volpe2_WEB.jpg.html)

[Tchocky]

It's not always a great idea to read someone with whom you agree completely, but over the years I've liked Jonathan Chaits writing on this.

http://nymag.com/daily/intelligencer/2014/01/republicans-make-saddest-hostage-threat-ever.html

[Rockstar]

Will this merrygoround ever end?

CZDH ZPYC ZQXV FFWG PDSZ YQKI WJNR QMVT ATPM VKOY UTSG DMER PDQQ FQXE JSWR AM


Enigma M4; plugboard QW,ER,TY; reflector C; rotor settings GAMMA 01-J, I 10-J, III 9-I, II 21-U; ring SUBZ.

Yes I am bored

[Oberon]

gg, nextmap

[STEED]

There is more chance jim running stark naked though Manchester than America defaulting.

[Skybird]

As long as politicians are allowed to have their hands on the money printer, it all will constantly become worse, because more delaying time can only be had at the cost of getting an even greater burst at the end. and that end will come one day. Delaying is not avoiding. Until then politicians, to save their skins, will do any lie and dirty trick and manipoulation and damage and crime they can in order to push the pay day beyond the end of their career time.

Politicians allowed to print money/introduce paper money/found central banks, are the killing knife stab in the back of any idea about a functional society, big or small. Keep politicians and money separate, at all cost. Shoot every politician trying to gain control of the money. Because if you let him get away with it, he destroys the fundaments of civilised society.

Every playing child counting its candies knows that it cannot consume itself rich, but can only become rich by saving them. Economic investments done on the basis of credits, are not producing wealth that could last, but they build illusions of "being rich". Only investments of previous savings can achieve lasting wealth that grows in the long run. Any other claim - is a cheat, a trick, a lie. Yes you can blow up m,onumental illusions and deceptive facades: and end up with Facxebook producing nothign, but nevertheless beeing hoeplessly overrated a thousand times. Imagine a world where the curerency would not be meaningless leaves of paper, but gold or silver: and Facebook would just be a minor company of very limited monetarian value. When judgement day comes and debt and paper currencies of today collapse, all those incredibly clever people holding shares of companies like this, will experience a very hard and brutal wake-up to reality. They will own shares of a company that produces nothing of value. And a share of nothing is - nothing.

That was illustrated and proven by wise minds already 50, 60, 70 years ago. The reaction of politicians: total ignorance of the unwelcomed news, and a total turning towards Keynes instead, the high priest of illusions supporting the dream of an everlasting party.

But last time I passed the kitchen door, the smell from undone washing-up and rotting mold already threw me to the floor and almost killed me.

Keynes, no matter how irresponsible and narcissistic he was, knew very well that his theory - if one dares to call this loose collection of confused ideas and absurd imaginations a theory: I do not, for sure - could not work. His reply to the question of how it all will end in his system, became legendary: "In the end we're all dead." And it were no biologic facts he referred to.

[Wolferz]

Pay no attention to the man behind the curtain.

The great and powerful Oz has spoken.

[Pisces]

Huh? The year barely started! Shouldn't budgets last longer?

[Armistead]

When you can print worthless money at will, no need for a default...not to be compared to collapse which will certainly eventually happen.

[STEED]

Print paper money today.

Tomorrow we go boom.

We get the same old BS here...Is this world wide? :hmmm:

[Tchocky]

I certainly refuse to be paid in paper money.

Everyone knows it's worthless.

I'm so clever.

[Jimbuna]

Gold and diamonds for me if you'd be so kind :smug:

[soopaman2]

Am I the only one who thinks the only way this crap will be fixed is by letting it collapse under the strain of its own gluttony?


The American politician is under the misconception that taxpayer money is free and infinite, and they rigged the system to keep us powerless, don't give me your crap about voting, you are just calling heads or tails on a quarter when you vote,....But it is still a quarter, and the entire quarter is warped. We got a rusty hunk of metal. What side of it looks shinier?

I for one welcome a Syria/Libya like thing here, despite the fact uncle sam would strafe protestors with planes just like Assad/Khadafi did, or even better use the media to discredit them, like the Occupy or tea party movements.

[Tchocky]

Yup, the US government is well known for its propensity to machine-gun protesters.


Sure it doesn't even make the news anymore, due to it being so common.

[MH]

Am I the only one who thinks the only way this crap will be fixed is by letting it collapse under the strain of its own gluttony?


The American politician is under the misconception that taxpayer money is free and infinite, and they rigged the system to keep us powerless, don't give me your crap about voting, you are just calling heads or tails on a quarter when you vote,....But it is still a quarter, and the entire quarter is warped. We got a rusty hunk of metal. What side of it looks shinier?

I for one welcome a Syria/Libya like thing here, despite the fact uncle sam would strafe protestors with planes just like Assad/Khadafi did, or even better use the media to discredit them, like the Occupy or tea party movements.

Spending beyond ability has also a lot to do with keeping the asses of the voters cozy becouse god forbid if they don't or do lol.

[soopaman2]

Spending beyond ability has also a lot to do with keeping the asses of the voters cozy becouse god forbid if they don't or do lol.


Pander to the masses!

Damn the torpedoes! Full speed ahead!

Worked for Admiral Farragut, but such tactics in economy is wreckless and irresponsible.

I am a tax and spend Liberal, and I find what is going on gross and revolting. That says alot.

[Skybird]

I certainly refuse to be paid in paper money.

Everyone knows it's worthless.

I'm so clever.
You clever guy should meditate a moment about what this idea of a "fractional reserve system" really means, and what it means related to the constant increase of the amount of money in circulation, and the constant devaluation of said money.

But maybe you will not accept to see that until the day the banks remain closed or the zeroes on your banknotes count by the dozens. Maybe then you will refuse to be payed in paper money.

If your worldview can stand that disillusionment then, of course.

LINK: Fractional Reserve Banking (http://austrianeconomics.wikia.com/wiki/Fractional_reserve_banking)


Technically, fractional reserve banking is embezzlement, but it is considered legal now. The bank is insolvent, because it cannot honor its commitments. But unless the customers demand too much money at once – or too many loans fail – it can continue running, without the customers ever noticing that their money was gone. If the bank's customers lose confidence in the chances of the bank's repayment, they can decide, en masse, to cash the deposits in. This loss of confidence, if it spreads from a few to a large number of bank depositors is called a bank run (http://en.wikipedia.org/wiki/bank_run). It is always fatal, because, by the very nature of FRB, the bank cannot honor all of its contracts.
Money created from credit only, that has no real-value representation, is worthless money. People today are under a spell and so think they are rich when owning paper money. That illusion only last until the first player at the table looses his trust and wants to see the cards.

All banks are bankrupt right now. All states are as well. The king is naked. That simple it is.

[MH]

But maybe you will not accept to see that until the day the banks remain closed or the zeroes on your banknotes count by the dozens. Maybe then you will refuse to be payed in paper money. Ohh well ... then ill be back reality.:o
Should i vote for it though?:haha:

With current population grows and the need of economical growth to sustain decent lifestyle is it possible to return to 19th century system.

[soopaman2]

http://en.wikipedia.org/wiki/Hyperinflation_in_Zimbabwe
100 billion dollar bill coming soon.


Why we gave the Federal reserve, a private entity power over the worlds currency is beyond me.... (yes commodities are still priced in dollars, but if we keep printing money it will be in Chinese RMB, due to loss of faith.

This came about after Nixon killed the gold standard.

The fed, and some a-hole *cough* Bernanke, Greenspan* (pardon) who is not held accountable to the american people by vote, or appointing by congress, the Fed is private. I do not understand why the last generation let them rape this country by allowing this change.

Thank you for allowing this, then trying to blame my generation for it.

You all got yours already I suppose....

[Wolferz]

When they finally get to the point of defaulting on the military payroll, that's when the fur will start to fly. Unfortunately the thieves will be long gone by that time.:-?

[soopaman2]

When they finally get to the point of defaulting on the military payroll, that's when the fur will start to fly. Unfortunately the thieves will be long gone by that time.:-?


I don't even want to get started on military spending. (edit: that particular subject really chaps my hindquarters)

No we do not need another 30, billion dollar planes we will use in anger 2 times before retiring them.

[Wolferz]

I don't even want to get started on military spending. (edit: that particular subject really chaps my hindquarters)

No we do not need another 30, billion dollar planes we will use in anger 2 times before retiring them.

It must have been rough for you getting stuck in that Governor endorsed traffic jam.:03::haha:

[Skybird]

With current population grows and the need of economical growth to sustain decent lifestyle is it possible to return to 19th century system.
A hopelessly confused question. Not one of the several implications you make there, is true.

[TarJak]

When they finally get to the point of defaulting on the military payroll, that's when the fur will start to fly. Unfortunately the thieves will be long gone by that time.:-?Where would they be then?

[u crank]

I for one welcome a Syria/Libya like thing here, despite the fact uncle sam would strafe protestors with planes just like Assad/Khadafi did, or even better use the media to discredit them, like the Occupy or tea party movements.

The possibility of a successful violent overthrow of a government resulting in better conditions for that country's people is less than zero. In my opinion.

[August]

Will this merrygoround ever end?

Not as long as they hitting the debt limit.

Remember every time they have this problem it's because the government wants to put us deeper into debt than we've ever been before. :dead:

[August]

The possibility of a successful violent overthrow of a government resulting in better conditions for that country's people is less than zero. In my opinion.

I wouldn't say zero but the odds are certainly against it.

[Father Goose]

Will this merrygoround ever end?

Simple answer: No, not until the crash.
The US is going so far "off the cliff" that hyper-inflation won't even work. :timeout:

[Jimbuna]

Then I'm praying it doesn't happen before June 2015 http://img98.imageshack.us/img98/9425/praydl5rp5.gif

[Wolferz]

I need a new belt. This one has run out of holes.:-?

[Tchocky]

You clever guy should meditate a moment about what this idea of a "fractional reserve system" really means, and what it means related to the constant increase of the amount of money in circulation, and the constant devaluation of said money.

FRB allows the creation of credit beyond what is immediately available in direct funds. It works off the principle that not everyone wants all their money out of the door at the same time. Which has been verified and re-verified over a couple of hundred years. I know exactly what it means.


LINK: Fractional Reserve Banking (http://austrianeconomics.wikia.com/wiki/Fractional_reserve_banking)
Ah here, you wouldn't post creationism links in a geology thread.

For everyone else - https://en.wikipedia.org/wiki/Fractional_reserve_banking

Money created from credit only, that has no real-value representation, is worthless money. People today are under a spell and so think they are rich when owning paper money. That illusion only last until the first player at the table looses his trust and wants to see the cards. Any currency other than direct barter works on a basis of trust and shared value. That includes gold, silver, stones, old batteries, $/€. After all currency is nothing but delayed barter. It's all worthless unless there's common agreement that it demarcates value.
Money is only a transfer mechanism. It's not like the world would be a better place if everything was constantly backed by a random arbitrary metal as opposed to measured, verifiable economic action.

People are rich when they have paper money. Because it's easily converted into goods and services. They're not living in a dreamworld.

All banks are bankrupt right now. All states are as well. The king is naked. That simple it is.Yes, the global economy and financial system is just that simple.

A old guy is driving home. His wife calls him and she says "Be careful, there is a lunatic driving on the wrong side of the road, it's on the news."
He replies, "One, there's hundreds!"

http://www.theonion.com/articles/us-economy-grinds-to-halt-as-nation-realizes-money,2912/

[Skybird]

FRB allows the creation of credit beyond what is immediately available in direct funds. It works off the principle that not everyone wants all their money out of the door at the same time. Which has been verified and re-verified over a couple of hundred years. I know exactly what it means.
You just ignore that it leads to bancruptcy over and over again. As history has proven. No such system ever survived.

You just follow the popular mainstream idea of creating demand, credit-financed (how else), and all the other popular myths that have led us right to where we are.

When you have a perosn going to the bank and paying in 1000 bucks, and the bank is allowed to hold only one tenth of that in real reserves, and pay out the other 9/10 as new credit, then you create more money, new money, from nothing. Which devalues the money in circulation. Which essentially is inflation. Because the bank gives that money as a credit to a new debtor, who uses it to invest into something, do usual bank deals, and pays at least major parts of it to other banks - who again hand out most of that money to other debtors, becasue it must hold only one tenth of that sum as reserve.

If you do not see that as an essential and vital problem, then nothign will ever make you waking up: Somebody payed 1000 bucks toa bank as credit, and the bank uses that to increase the ammount of money in existence - WITHOUT THAT NEW ADDITIONALL MONEY REPRESENTING ANY NEWLY CREATED MATERIAL VALUE. And the ratio is intimidating:

After the first paying in (forgive my probably inapt English here, I am not familiar with precise business English and the German terminology probably would not help here) by a customer of 1000 bucks, the bank can hand out nine tenths of that money to other customers, as new credit, becasue it must hold only a fractional reserve. That would be new money worth 900 bucks. Comparing assets and liabilities, the ammount of money in circulation (digitally or paper, it does not matter), has grown by 900 bucks.

But it does not end here. The debtor of the bank who has taken those 900 bucks as a credit, uses it to mind his businesses and in the end the money ends on bankjg aco****s of other banks, emplyoees he payed, bills he payed, and so forth. Thsew banbks again can use this money to just keep one tenth in reserve, and hand out nine tneths again. From 900 bucks, the bank hands out 810 bucks, and only keeps 90 bucks in reserve. Adding together the increase in money from the first (900) and second (810) iteration of this game, the original, value-covered (lets assume that) 1000 bucks, have grown to a total of 2710 bucks. But only 1000 bucks of that sum is real value. The remaining 1710 bucks are - "uncovered", value-less. They are FIAT indeed.

Now go to the next iteration, and do your math.

I spare myself from commenting the rest that you posted, since it just represent the very ordinary mainstream ideology on banking and money theory that currently is exploding right into our faces. Maybe you currently are better off than others and still can live by these illusions. Maybe it are fears or hopes that drive your thinking. But the blow will catch you sooner or later, and there will be no rescue if the governments play it the hard way then. Not even gold and land property will help then, if there still are governments then who serve as monopolists in law making, money creating and and law enforcement, because they can legalise any looting and robbing, any prohibition and expropriation they see fit to help them protecting their powers, and their personnel's "careers". Governments, as initiators of paper money and central banks, are the origin of the crime that is going on. What they do today with paper money and money printers, is not any difrferent to medieval monarchs ruining their coin currency by thinning out the content of gold and silver the coins contained. Not only is th emehtod the same, it also is done with the same ruthless intention: to spend more than can be afforded, to steal from the unsuspecting populations, to redistribute wealth from the many to the few.

"You know exactly what it - FRS - means", you say? Sorry, no, I do not think you know what it really means, since you ignore all its destructive implications that some wiser men have warned of already 50, 70 years ago, and earlier. And the basis of these men'S thinking already has been laid out decades before them. What you know is the colour of sand when the head sticks deep in it. One should rememeber that none of the established economic schools was able to warn in time of the fiscal disaster becomign apparent in 2007, and that none of these schools forsaw and predicted correctly the general trend of the erosion of the currency and economy from the 1970s on - none except one, the so-called "Austrians". And not only did modern Austrians almsoit completgely rang thre alarm eblls before 2007, but earlkier Austrians preicted these developements already in the 1930s and 40s - and explained clear and straight why these developments would be unavoidable. that is more comoetence and healthy reason and insight into human psychology, than any of the recent years' and decades' Nobel prize winners in economics can show up with. The only Austrian ever given the Nobel, was Hayek - and to minimize that recognition at the same time, he had to share it with another guy, a socialist, who represented exactly the opposite in thinking and argument, than the Austrian school represents. It was schizophrenic, and an offence.

[Skybird]

Just one more thing, about bartering and trust. FIAT money is a bet on the future, because FIAT money represents no intrinsic value, but is a debt bond only - a debt bond that holds hopes for the future - that you find somebody willing to trade your paper ticket for some real asset. There yiuz are right, such a system is basing on trust.

Gold, on the other hand, has a long tradition of being seen as a value in itself. That has many reasons that almost all are of practical nature. Even if you do not form it into an official currency (=coins), it keeps that value, for example as bars, nuggets, or rings and necklaces. That'S what makes it very different from FIAT and paper money, and that is why political leaders hate it so much and makes them artificially manipulating the gold price to keep it low, to bölind the people that it is meaningless and paper money is so much more lucrative.

In 2008, chnacellor Merkel saw the need to tell the Germnan people the biuggest lie I am aware of in the modern German post-war history. She said that the state would guarantee for the safety of all private savings people held at banks. A lie it was, because everybody doing some math knew that there is not enough money in all europe to pay out all German private savings if the creditors (that is what you are when you do not rent a bank safe, but pay money into your bankiung account) would storm the banks and demand their money back. That is what is called a bank rush, and since a bnbak rush aims at paper money and not gold you have stored in a poriuvate safe at the bank, again you are right: the sysytem only worksd as long as peoploe trust it.

But people trust it only because they do not understand it.

Because in a fractional reserve system, all banks are bankrupt from the beginning on. They cannot pay back the money customers (creditors) have given them, because over 98% of the money numbers cirulcating in the world, are uncovered sums of money that are not ciovered by any real asset and value. That is the result of the devastating increase of money in circulation as I described above. It is not money represetnign value. It is paper notes representing debts. And this snowball system, this giant fraud and biggest embezzlement in the history of mankind, must collapse when trust is gone.

To you iot seems to be a problem of lacking trust in a criminal construction. That is putting reality from its feet on its head. To me, the problem lies in the criminal construction itself. Politicians wanted it this way, they wanted to be able to increase money as they needed it to pay for wars, and to spend for their ongoing voter bribery, the last thing any polticians wants is spending discipline. A gold-standard (or any comparable currency expect virtual currencies, which are just paper money without paper) refuses to give politicians that unlimited amount of money, and the price indexing of the market also is much more difficult for the govenrment to manipulate it with a gold standard money of limited quantitative availability, than with paper money. With paper money, you can manipulate prices and the way you want with the money printer, or shaving off money form the market. With gold standards, you can do that not that easily, and the prices react much healthier and sensible to economic ups and downs. In other words: in paper money's world: you can hide reality behind the prices, with a gold stanard, you have to face reality. The first comes handy when cheating your voters.

The criminal nature of the setting is the problem - not the lack of trust in it. Of course, both democrats and socialists, which in the end is one and the same, do not want to admit that. It strips them off their power basis and leaves them unable to finance their ideologic utopias by which they blind the masses.

But never ever has reality bend to ideologic demands, never has nature's laws been twisted due to belief or hear-say. The bill will be presented, and nobody will avoid to pay for it.

I think that is only just, and is Karma: the unescapable causal link between cause and consequence.

[MH]

Any currency other than direct barter works on a basis of trust and shared value. That includes gold, silver, stones, old batteries, $/€. After all currency is nothing but delayed barter. It's all worthless unless there's common agreement that it demarcates value.
Money is only a transfer mechanism. It's not like the world would be a better place if everything was constantly backed by a random arbitrary metal as opposed to measured, verifiable economic action.

People are rich when they have paper money. Because it's easily converted into goods and services. They're not living in a dreamworld.
]

:salute:

[Skybird]

^The old socialist megalomania that competent central planners can forsee and plan human action and motivation, and thus can plan demand and make people meeting that planned demand with their personal desires, and all that planned economy bollocks.

And one thing Tchocky has gotten wrong again: "random arbitrary metal as opposed to measured, verifiable economic action". Gold is not random arbitrary metal, but a metal that the people agreed in voluntary market evaluations to accept as something of value. Gold became what it is seen as by bartering between free people who negotiated the conditions of their next deals vis-a-vis! That value it was attributed with due to certain practical characteristics (you can form rings and necklaces of it, it has unique physical characteristics, it is easy to be formed into coins and bars of any size and thus: value), and its ratio between market saturation and nevertheless limited physical availability. Many if not all value units for currencies base on old weights, if you follow the lingual roots. Mankind experimented (bartered) for millenia until gold and silver started to become dominant items used as currency that started to become dominant over other classes of items used before. Also, gold and silver became that because they were not ordered or planned by all-knowing clever state authorities to be that, but because they were - AND ARE!!! - ordinary trading goods whose value is normally negotiated between market participants. At least that is how it should be, but goivernments do their best to mess up the gold market price fixings, obviously. Gold is any modern government's most bitter enemy.

And all this is what makes it totally and completely different from state-planned oh so clever designed paper currencies. Here, with paper money, it is the centralised planner setting a fixed value index.Money should have this or that value, period. A price index it is not, because different to gold, paper money is no trading good like any other, it has no trading value in itself, like gold. Only collectors may be interested to get a piece of paper money, like others collect postal stamps.

It also is a myth that the state must "control" the amolunt of ciruclating money, in order to stablize prices. What the state and its super-clever paölnners do here, is legitimising their own useless existence. What they indeed do is prevenmting a natural price fixing by the market, so that traders and businessman can no longe rbase their planning and cvalculations on realistic cost-effect- and value-per-item calculations. Polticians say that soembody must control the ammount of ojey, and this someone shold be the central bank (that politicians have installed in their destruction of value money and its replacement with politically wanted paper money). Truth is, how much money is circuclating is completely unimportant. The more money units are circulating, the more invaluable the currency is: and the prices go up to compensate for that. Collect and delete some of the circulating currency, and their is less money: it become more valuable, and thus the prices go down. Only where politicians want to prevent prices from freely fluctuating, in order to deceive people about any conclusions about the economic state that observing freely fluctuating prices allow, only then you have a "need" to "control" the amount of money in circulation. It is an underhanded and malicious betrayal of the public, of course, serving the hiding of the state'S crimes, and legitimising the criminal acting and fraudster by the clever state planners who know it all so very well.

The state grabs and wants more power and control all the time. Free markets is what state planner shate, because, like Tchocky, they think that things can onyl function when clever planners plan them. We can easily see that the stae today offers service for much higher prices which for the most are offering much lesser service, than rivalling services. School's a good example. The answer, from the POV of the state: forbid private schools for the most. Forbid anything that forces the state services to face competition . Just steal form the population and pump that loot into state services. So much less can be had for so much more tax money! :yeah:

In private business, the problem of monopolism is a fact. I know that, and it must be controlled and tackled. I agree it is not easy, and that it is the one big hurdle that decides whether alternative social orders can work or not. But the state is not the answer, because the state is by far the very greatest and biggest monopolist of all. And he abuses this monopoly all the time, for blackmailing protection money, for enslaving people for state services and state duties, for submitting people to endlessly increase their investments into state-run industries, namely public administration and social wellfare in the widest meaning, for taking away and reducing porivate repnsibility as well as private liberty, for reducing the protection of private property and partial (and growing) de factor expropriation.


In Germany, between 1960 and 2000 the spendings for social welfare have been multiplied by a factor of 19 (yes, nineteen). One third of the state budget was and is spent in the social sector, tendency climbing due to the over-aging of population. But who benefits from that money? It is not the needing ones, like simple math can show: roughly 5-10% of the total population can indeed be counted as people needing help. When comparing the number of people in need versus the total sum of money allocated for the social sector, everybody in need should get around 300,000 per year! Obviously it is not like that, most get some hundred per month, a low 5 digit sum of money per year. So the question is where is all the money going? The answer: it get stuck and disappears in the system, it is the loans and wages for all the employed people in the "helping" and social jobs, it is the reserve building for their pensions, and so on. For every head counting as a needing one, there are ten people who today base their living on managing and running the administrating processes that pay the needing one his some hundred bucks per month. If the needing ones suddenly would be not i n need anymore - we would have a major economic collapse and a breakdown on the labour market immediately!

Clever plans by clever planners. :yeah: Planned economies work. Thats why German engineers in the West designed cars "made in germany" by hundreds and thousands of models that were asked for all over the world, and German engineers in the GDR designed two cars only that were "made in Germany": the Trabant, and the Wartburg. :know:

When state officials and defenders of strong centralised states say they plan to plan a better future, all I can say is:

"Run away guys, run as fast as you can"

[MH]

^The old socialist megalomania that competent central planners can forsee and plan human action and motivation, and thus can plan demand and make people meeting that planned demand with their personal desires, and all that planned economy bollocks.
:zzz:



. Mankind experimented for millenia until gold and silver started to become dominant items used as currency. Also, gold and sioilve rbecame that because they were not ordered or planned by allknowing clever state authorities to be that, but becasue they were - AND ARE!!! - ordinary trading goods whose value is normally negotiated between market participants.

Same thing with paper money.
Just evolutional development , an adaptation to modern economy.
You may keep investing in precious metal if you wish....thats what it is all about....putting faith in something while others become millionaires of facebook.