Meet The Man Who Quit Money

[Strawberries]

[DarthNinja]

Why do people need to know the intracicies of money to participate in teh system? They don't, it works all by itself. Also, if you don't want to hold fiat currency you can always trade it in for physical gold and silver, right?

[Amish Rake Fighter]

Of course money is debt. Money is value you've gained for your services that you have yet to spend. In a narter system, a guy who builds a house for a fisherman can't accept payment in fish. Obviously, the builder gets a reciprocal value (pinecones or whatever) that he can choose to spend at a later time. What does his ability to spend depend on? The fact that someone in the future will probably produce something that he will spend the money on. So, yes you are right that money is debt. I don't get how you extrapolate that it's designed to fail.

[Orca_Boy]

Because fully fiat currency isn't backed by value (like gold) which means that governments can print it out of thin air.

When governments print money out of thin air (inflate the money supply), it devalues existing money stocks.

When existing money stocks get devalued, the holders of money lose their purchasing power.

When holders of existing money stocks lose their purchasing power, price inflation occurs.

This eventually leads to the intrinsic value of the dollar going to zero.

Fully fiat currencies have an average life span of less than 30 years, Nixon closed the convertible gold window on the world's reserve currency 41 years ago.

[Orca_Boy]

The debt-based system grows exponentially, and with the US debt currently in the Trillions, it's just a matter of time before it collapses. We haven't been living in this system for thousands of years, more like since 1913 when the Fed Reserve was created and given the power to run the system above government.

Why would a free market result in living in caves exactly?

[Amish Rake Fighter]

There's definitely a difference between money viewed as a medium of exchange and money as a store of wealth. Of course as poopulation grows, money supply can't stay the same. Just about every currency has been subject to this. I don't know many people who let their assets sit in cash for decades. Most people I know have most welath tied up in real estate or stocks. Both these have properties that resist inflation. Most people who can learn a little should be able to grow their wealth faster than inflation. As a store of wealth, cash is awful. I guess those who held $1000 1950 will have about $100 of purchasing power. And if I hold $1000 cash until 2070, it'll probably have $100 purchasing power. The problem is, no one does this. So the value of money devaluing (as long as it's been at a slow, predictable rate like we've seen for almost a full 200 years) just isn't a problem that affects many people. I don't exactly see this long term problem as something that signifies or guarantees a failure or collapse of a monetary system.

A true collapse of a monetary system happens when the short term value of currency can't be predicted. The reason other countries have historically liked the USD as a reserve is because they trust the people who create it not to go too far with expanding it. Currencies like the mark, peso and ruble just don't have the same trust. Every currency collapse has followed a short term crisis of confidence in the central bank. This is the real way to judge whether a currency will end up in crisis.

So you and dank are right on a couple things. Money is debt and inflation is a problem of all fiat currencies in the long term. But Inflation happened under a gold standard. Short term inflation swings are much more likely to cause a crisis. There are good and bad central banks. Banks that act unpredictably cause inflation crises. Predicatable and stable central banks don't collapse currencies. I just don't buy that fiat currency is intrinsically destined to fail. Unless your 60 year purchasing power power issue is the definition of a collapse. I can absolutely see why anyone using this investment strategy would get fed up and consider a move into a cave.

[Jester@wraiths.ca]

I just think the story is misleading. Sure, he doesn't live off his own money, but every handout he takes, cost someone money. He has minimalized how dependant he is on money, but just because he doesn't use his own money doesn't mean he doesn't benefit from others using money. Dumpster diving is still taking advantage of the monetary system. He wouldn't have the dumpsters to dive in if the monetary system wasn't there. Checking his email at a government funded facility IS using the system. Yes, he uses the system far less than 99% of people, but he still uses it.

He's much more prepared for if the world's monetary system had a complete collapse, which though it's a different topic, probably will happen at some point as the system is a house of cards...