Wednesday, April 30, 2008

The Search Begins!





Since it is readily apparent that Vox is going to keep the abomination that is ComiComment... I believe we now have to deal with a pressing matter.





Spacebunny has no avatar.





Now... I would greatly prefer her to have a pirate flag of some form... cause lets face it... Pirate chicks are hot. But if that's not an option... Then let me offer this suggestion:



Granted.. its unspeakably awesome... but I confess there may be something better. consider for example the design on this t-shirt.
One of you talented cats could whip something like that out in a heart beat. What do y'all think? Perhaps you could even work that design into a pirate flag! Let's get to work boys.

Why Yes...

Yes I DID buy 2 Titans PSLs for face value... thanks for asking!

Tuesday, April 29, 2008

ComiComment

If you can't think of anything nice to say...

...

yeah ok.

Anyway... so lets review... you have a comment system that is supposed to allow all sorts of cross referencing so you can easily find comments from commenters and specific subject matter. Great. Except of course... you can't see the comments.

I am reminded of everyone raving about how awesome their new Iphone was... even though it wouldn't actually make phone calls.

The biggest problems I have with it?

1) There is no obvious way to see if new comments have been posted.

2) Russian helicopter pilots think this system isn't very intuitive.

3) It interferes with the basic workings of Haloscan.

4) Its very very slow.

5) Its ugly.

6) It loses large sections of longer comments... just like haloscan did.

7) It requires registration.

8) Someone has the name "Nate" registered already.. and its not me.

9) There is no way to see all the given comments on a given post.

10) I can't really think of a 10th thing I hate about it... but I am putting it down here anyway... just because.

Thus Sayeth Nate... King of the Resistance Fighters! Lord of the Ludites!
Vox: It Sucks

I'm sure you can tell by the style of this blog... I'm not a big fan of change. I am more of a... "if not's not broke... don't fix it" kind of guy. The blog works. You can read what I write. You can comment in a simple and easy manner.

Vox's blog used to be the same way.

Now...

Now he's decided to beta-test some god-aweful java script commenting system...

I attempt to comment... I see there are comments... well... actually what I see are a bunch of blue lines cluttering up the blog and interfering with the posts. But being the genius that I am.. I click the "expand" link... which transforms those lines into comments but only some of them. Seems it likes to start with the oldest... but it only shows you so many of them... and you can reverse the order to see the newest ones... except it doesnt really show you the newest ones... instead of showing comments 5 hours old... it shows comments 4 hours old... if you want to see comments made a few seconds ago... you're screwed.

This is why God invented Test Blogs dude.

Go to blogger... start a new blog... name it something clever... like... testblog1.... and try out the new "hottness" there. Once you beat the suck out of it... then and only then... should you foist it on your readers.

I tried to comment using the system... but found it maddening.

I hope haloscan returns... and the sooner the better.


***UPDATE***

I am moved to wonder if the developers had any idea what they were getting into. I mean... is anyone suprised at all that the commenters over at VD's blog were merciless? Because ruthlessly tearing something or someone to shreds at the slightest sign of weakness is so unlike them.

Monday, April 28, 2008

Ruminations on Cruisers

So I've been impressed with how light the Vulcan feels... and I've been ruminating on it. Remembering back to the big cruisers I've ridden... I can't help but note how much lighter this bike feels. Something about mass centralization maybe? nah... not likely... Maybe its something simpler... so I started digging up the dry weight of various cruisers that I've ridden or are at least comparable.

VTX 1300 = 710 lbs

VTX 1800 = 770 lbs

Roadstar = 695 lbs

Suzuki C90 = 665 lbs

Harley-Davidson Fatboy = 669 lbs


Now... Cruisers are notoriously heavy bikes. Its like they design them that way deliberately... or more accurately... the manufacturers just don't care... because the consumer doesn't care. In Cruiserland all that matters is displacement. Let me give you an example. The 2007 Vulcan 900 has a 903cc engine. The Yamaha Vstar 1300 obviously has a 1300cc engine. It doesn't matter that the Kawi is faster... and even produces more power than the Yamaha. Cruiser buyers don't pay attention to actual speed or power. All they care about is displacement. To them bigger number = more powerful. Yes... they really are that stupid. So there is no point in shaving pounds. The market doesn't even care how much power is actually produced... they just care what number is stamped on the side.

Ok.. but why does my bike feel so much lighter?

Well... That's because it is that much lighter. My bike weighs in at 548lbs. That's very comparable to the CBR1000f I used to ride. In fact... the curb weight of each bike could well be similar because the tires and gas are heavier on the CBR.

Consider this... My Vulcan 1500 wieghs LESS than a Harley Sportster 883.

But what are the power numbers? If I'm being honest I have to say.. I don't know. It varies engine to engine. It varies over time.. plus after market accessories affect it.

Best guess? > 85 lbs of torque.... and > 70 hp To put that in perspective... those numbers are superior to any cruiser that weighs in less than 600 pounds... and better than most that weigh in less than 670. The biggest of the big... the Vulcan 2000... the VTX1800... they produce more power... maybe MUCH more power... but they also weigh in betteen 200 and 250 pounds more!

That puts it about the opposite of JAC's 1150gs... which would smoke the Vulcan. Because... contrary to what the Harley T-shirts say... Horsepower matters more than Torque.

The low seat and comparable low curb weight make the bike feel light. That's exactly what I wanted. The fact that it will smoke a VTX 1800 is just a bonus.

Friday, April 25, 2008

Ahem...


Sorry... I've been occupied.



A Vulcan 1500 of course. Bulletproof. The photo above is not the bike I got... but it is the same make and model... I'll post some pics of the new ride when the sun comes up. In the mean time... I have to go buy DrWho some pants with no ass them.

Hey... what do you think... fringe on the bar ends???

yeah... Prolly not.

Thursday, April 24, 2008

The Greatest Line in Any Movie... Ever





Stick with it. Trust me.





Tuesday, April 22, 2008

Derby Talk

Its that time of year again... Time to break out the julep glasses. But for now... lets set aside the bourbon talk... and get to the horses. I am not gonna break down the whole field... but there are some notables for one reason or another that I think you should be aware of.

The Likely Favorite

Big Brown: Undefeated. Big and Bad. Watch this video of this year's Florida Derby. Its not a wire to wire win... but it may as well be. Pay particular attention to the kick displayed down the stretch. It was a very fast pace y'all... but Big Brown still had another gear. Folks are going to knock this horse... he was hurt last year... he's only run three races... long lay off... blah blah blah. To them I say... Watch the race. Oh.. and one other thing on Florida... notice his gate. He started in gate 12. This is not a one race wonder. He won Saratoga by over 11 lengths. There are some questions.. but I believe once they're answered.. we all may be feeling silly for asking them. Big Brown is has sprinter parents... but when you look deeper in his bloodline you see some serious distance horses. We may well be seeing the birth of a rock star y'all.

Second Tier

Gayego: Ok... granted... his name sucks. But getting beyond that... he ran a great race in the Arkansas Derby... and he's won on very different tracks. That kind of consistancy is a big help in the madness that is the derby.

Tale of Ekati: Ran down War Pass (more on him in a bit) to win the Wood Memorial. You'll hear his name a lot. Its just my opinion... take it for what its worth... but I don't buy this horse. For one thing... the horse did not run that good a race. Anyway... I include him in this teir because of the hype he'll recieve on ESPN on saturday.

Pyro: I don't know... something isn't right here. Everything was shaping up for this derby to be a duel between Pyro and War Pass... Pyro was the probable favorite... then he stank it up in the Bluegrass Stakes... and by stank it up.. I mean he ran 10th the whole race and never displayed any desire to move up. It was just a half-assed race that raises a lot of questions about heart.

The Best Horse Not in the Race

War Pass: Man this sucks. I'd love to see this horse match up with Big Brown in the Derby... unfortunately it looks like we'll have to wait for the Belmont. He has all the talent in the world... He almost won the Wood on a broken foot... and it was that broken foot that let Tale of Ekati run him down. Real shame. It's likely that the same injury could be responsible for preventing a triple crown winner this year... since Big Brown may be battling a fresh War Pass... as well as the distance at Belmont. Of course... after you see Big Brown run... it may not matter.

The Dark Horse

Adriano: In horse racing there are a lot of great trainers that hardly ever bring horses to the Derby. Graham Motion (even if he is based in God Forsaken Mary Land) is one of them. When he decided to show up with Adriano... it perked up some ears. I suggest you pay attention to this horse... especially when you note that Edgar Prado will be riding him.

Predictions?

Its to early. I want to see the workouts... but for now... I see no reason to think anyone in this field has anything for Big Brown. I don't even think a bad gate draw would be the end of the world. Right now... I think this horse is gonna run off and leave the field. I do not expect an exciting race. How good is Big Brown? Kent Desormeaux said he might be the best horse he's ever ridden. That should give you pause. Desormeaux won the Derby on Real Quiet and Fusaichi Pegasus. Be advised.

Monday, April 21, 2008

America Cannot Die Fast Enough


Proof Here


No further comment needed.
Compare and Contrast

I bring to your attention to current news articles:

Artical 1: Where in we find that the family of a now dead woman is blaming 911 dispatchers for not saving her.

Artical 2: Where in we find that a man with a gun didn't bother to wait for 911 dispatchers to not save him.. and instead saved himself.. and also went ahead and provided the police with enough clues to get the badguys arrested.

Now a few things are amusing about the first article... note that they are sueing the 911 dispatchers. That's because they can't sue the cop the chose to leave when no one answered the door.

Remember... 911 is the number you want to dial if you're looking for someone to make sure the cops show up and collect your body in a somewhat timely manner. They can't do anything to save you though.

Its high time you realized that you are responsible for saving yourself. The police can't save you, and even when they can they usually don't. Its an uncomfortable truth for a lot of people... particularly women.

Deal with it.

Friday, April 18, 2008

Thursday, April 17, 2008

Don't Blame the Ragheads for Gas Prices

So you're pissed off because those mean ol' Saudis won't pump more oil eh? Those jerks over there in that kitty liter box are just greedy bastards aren't they?

Ummm....

Take a look at this graph... It shows the price of oil as measured in gold... vs the price of gold as measured in dollars.




Ummm... see that flat line down at the bottom? That's how much oil costs in gold. We call that stable. This is the biggest proof you need to see that the price of oil has actually not gone up hardly at all in the last 63 years. What's happening is plain and simple; we've printed to much damned money... and now our dollars are worth a little more than toilet paper.

This graph is undeniable proof folks.

Its not the arabs. Its not the greedy sheiks. OPEC is not to blame. Your government is to blame. The Fed is to blame. Hell... you are to blame.

Now see.. If you've been listening to ol' Nate... this crisis won't effect you at all. You can go sell some of the gold you been hording... and use it to buy gas.

If you haven't... well...

I hope y'all don't think this is gonna magicly get better any time soon folks. The only way to fix it is to deflate the dollar... which means contract the money supply... which means cut off the credit that the US runs on. Sounds like fun doesn't it?

This would be a really good time to start praying for some awesome leap in technology to show up here in the US... because that's the only thing that is gonna save this economy.

Tuesday, April 15, 2008

Perspective




This should give you an idea how much we paid in taxes this year:



And you wonder why I hate the government.

Monday, April 14, 2008

Hoist the Colors

Or at least your glasses mates! For on this day... on this fine day in 1865 a Great American... A Great Southron... a Great Man struck a blow for freedom and liberty throughout the world.

Raise your tumblers... and drink to John Wilks-booth... who on April 14th... spoke the imortal words, "Sic Semper Tyranus!" and killed the Tyrant Abraham Lincoln... curse his name.

If you have a Battleflag... fly it.

If you have a flag of the CSA... fly it.

And if you have a tastey adult beverage... drink it.


A toast to the death of tyrants!


Deo Vindice

Thursday, April 10, 2008

Red Letter Day: Part II

*** If you haven't already... scroll down and read Part I below***


Custom may dictate a brief recap to get everyone caught back up.... nah... piss on it.

From the truck I hear some mumbling... I couldn't really hear the guy... So I walked towards him... being pretty friendly.

"I already told that woman... that water is too deep to be out here! Those boys are gonna fall in there!"

What the hell? Who is this guy and what is he blathering about?

"Ummm... those are my kids. I'm their dad. Are you seriously suggesting that I am going to stand by and watch my kids drown?"

"They'd be in that water and drown before you could pull 'em out! Do you know how deep that water is?"

Now I'm shaking my head...

"I appreciate your concern... but we're fine."

"You're not even watching them boys. They are behind you and they could fall in right now and you wouldn't know!"

Now I'm thinking... you dumb son-of-a-bitch.

"I'm not watching them because I'm talking to you. Why don't you go away and stop distracting me?"

"There is a sign right there that says No Fishing."

"Old man... that sign was put there by the home owners association. The rule doesn't apply to people who own property here or their guests."

And with that... I decided I was getting too pissed and needed to remember that the boys were with me. So I walked away... and told the boys we were packing it up and heading in.

I assumed the matter was closed. I was mistaken.

About thirty peaceful seconds pass... and from behind me I hear...

"And I don't want to have to come over here and tell you again either!"

Chills shot down my spine... hair stood up... instinct took over... I spun around and started heading for the truck..

"Oh you're damned right you don't want to come tell me again! Who the hell are you old man? Just who in the hell are you? What is your name?"

"We're not talking about me we're talking..."

"Oh no... no sir... NOW we're talking about you. Tell me your name old man. Tell me just what makes you think you should go around shoving your ass into my business? Don't you realize that I'm the kind that'll come over here and fish every damned day just to piss you off?"

"No I'm not going to tell you my name..."

And now remember... Jeb and Eli are watching... Jeb walks up to the man's truck and says, "Excuse me sir... sir... what's your name?"

and then the crusty old bastard makes a near fatal mistake... he looks down at my son... and in a frustrate and hateful tone says, "I am NOT telling you my name."

Have you ever heard the phrase "Blood Rage"? I don't know if it is usually used to describe what I was experiencing... but I know of no other way to communicate the hatred and wrath that welled up in my heart.

I got right in the old man's face and said....

"You sorry old mother fucker... my son just addressed you with respect and you will speak to him with respect or I'll snatch you out of this truck and beat you till you never walk again."

"Well I don't have to listen to this..."

"No... You're damned right you don't have to... all you have to do is step on that accelerator and get your sorry old ass on down the road. Well... go on. Git! Git the hell outta here ya crotchety old bastard before I decide to find out exactly how deep this little pond is."

With that it occurred to me that my kids were probably listening...

"Jeb... Eli... come on boys... this worthless old son-of-a-bitch is complaining to much for us to get any decent fishing done here... let's head over to the state park and fish there."

With that... we gathered our stuff and walked back up to the house. On way back... Jeb asked why that man told us we couldn't fish there...

I told him...

I told him that some folks are just like snakes. Ya know a snake will bite you just cause its got nothing better to do. Like a wasp... they hurt ya just for sheer meanness. I told him that old man was just like a wasp. I told him that old man could've gone to McDonalds... he could've gone fishing himself... there were all kinds of things he could've been doing... but instead of doing them.. he chose to come be mean to us. I explained that we usually refer to those kind of people as yankees... or liberals. I pointed out that the old man refused to get out of his truck. I explained that the man was a coward. He was brave when he was safe in his truck... he'd talk big. But he wouldn't come out of his truck.. because he knew he was doing wrong and he was afraid I'd make him suffer the consequences.

Looking back... I know I was in the right... simply because the old prick wouldn't tell me who he was. Think about it. If he had any kind of right.... or any kind of authority.. he would've asserted it. He wouldn't have repeatedly appealed to the authority of a damned sign.

Later... my dad called me and explained who the man was. Turns out... he's a disabled World War II vet. How's that for the Greatest Generation? Yeah... So great that a World War II vet served as an excellent example of cowardice for my two boys. No doubt they'll remember exactly what a coward is now... and they'll recognize cowardly bravado instantly.

Oh... yeah... he's disabled. Well remember that threat about beating him till he couldn't walk?

Turns out he's got no legs... well... he's got legs... wooden ones... so if I really had decided to see how deep that pond was... at least his legs would've floated to the top.

Anyway... Its not every day that you catch your first fish... and its not every day you cuss a disabled world war II vet and threaten his life and wooden limbs.

I dunno how much I'll be around tomorrow... I have to take the boys fishing.
Red Letter Day

So today was an unusual day. Believe it or not... today... I caught my first fish. Seriously. My first fish.

Ever.

As I have stated on many occasions... I can't fish. I've fished hundreds of times. I've fished in stocked ponds. I've fished in super-double-secret-guaranteed-fishing-holes. I've fished right next to guys who were pulling out huge walleye... with the same technique.. and the same bait.

Nothing.

Ever.

Until today. See... today I decided it was time to teach Jeb to fish... and while I understand that it is traditionally an uncle's responsibility to teach his nephew to fish... Jeb and Eli are blessed with two no-account and shiftless uncles... neither of which can hold a job. It should also be stated... that their in-ability to hold a job is totally unrelated to any fishing habits they may have... since they have none.

So... in the face of these stacked odds... I grabbed our gear... and took the boys off to my parents place...which happens to face a nice little community pond. Now you've probably seen this pond a thousand times... it has ducks and signs around it that say "No Fishing, No Swimming, Ect...". Of course the home owners association put those signs there so every Tom, Dick, and Harry wouldn't come take all the fish from their stocked pond. It is in the by-laws that home owners and their guests are allowed to fish there. Remember that... it's important later.

Well... we were all down at the pond getting setup... when Nana started walking back to her house with Elkan.. and this crusty old man in a white pickup drives up and starts talking to her. I didn't really pay any attention... as I was busy teaching my 3 and 5 year olds the deadly nature of fishing hooks.. apparently the old man was concerned that we were going to leave the two boys unattended. Nana pointed out that I was their father and I would be with them... and he drove off.

From there... things went about as you'd expect. Many tangles... many many tangles... but Jeb and Eli eventually became pretty good casters all things considered. And... as Jeb says... the most important thing to know about fishing... you have to be able to wait.

It never really occurred to me that I could catch a fish... I was just casting... as far as I could.. and reeling the rappala back in... just like I had a million other times.. when it happened. I felt something. Then something else... then a bass jumped out of the water with my lure in its mouth.. ok well... it was sort of in its face... and gill... but still... I had the little bastard!

Jeb and Eli freaked out. They were jumping up and down on the bank... They were fired up dude... it was awesome.

And then another thing occurred to me... I've never taken a hook out a fish before... I've never handled a fish before... Here I am about to have to teach my boys important etiquette... protocol... and technique... and I am going to royally screw it up!

Ah...

But they don't KNOW I screwed it up!

HA! You can imagine... I did what you do... I made up some grand ritualistic sounding lore about always wetting your hands before handling the fish and tried to include things I'd heard others say... and I made up a great deal of it. But I'm getting ahead of myself...

So I pull the little bastard out of the water... I say little... I have no idea what little is. He was about a foot long and fatter than I had expected. He fought like hell too... jumping and such... it was a hoot. Anyway... I got him up... and I assume he'd been caught a lot because he was compliant as he could be once I got him out of the water. Didn't flop once. I had hell getting the barbed hooks out. I think in the future I'm going to cut the barbs off. That's a pain in the ass. I'd use them if I was trophy fishing or looking for supper... but for this purpose it was just overkill I think.

Anyway... I got him back in the water and he swam off fine... the boys were mystified. I was dumbstruck... and completely satisfied that the outing was an unmitigated success.

I let the boys cast a bit more... and just as I was about to tell them to pack it up... that white pick up truck showed up again.

And boys... this is where the story picks up.

More coming in Part II

Tuesday, April 08, 2008

The Myth of Inherent Value

One of the more loathsome arguments the Keynesians, and yes Resipsa... for the purposes of this post I am lumping you in there with them... as I recall on the Econ Quiz you swung that way a couple times, is the jackasstic claim that since gold has no inherent value, its really no different than paper... its just harder to manufacture.

Adding to this... Bill expands on his own previous record for Most Moronic Comment of the Decade by claiming that gold's biggest risk is currency debasement... He sites two examples over the course of 400 years... And of course... he ignores the debasement of EVERY PAPER CURRENCY ever printed. Seriously... Bill has actually claimed that we shouldn't go to the gold standard because some devious country might flood our country with gold.

The briarpatch should be coming to mind at this point.

Following the logic of these two... we shouldn't revert to the gold standard because one time 300 years ago the currency might have been debased... so instead we should cling to the current system... where-in we know beyond a shadow of a doubt that all currencies will be completely debased.. just like the sun rises in the east.

But lets get back to this "inherent value" idiocy. We call that a theoretical problem. Which is another way of saying "its not problem at all". The claim that the entire world might one day wake up and decide gold isn't valuable.. is plainly stupid. Gold has been used as currency for as long as currency has existed. It always has been currency.. it always will be currency. Hell... it was currency before humans had a word to describe the concept.

Now back to Bill's fears that some evil country might flood the US with gold... There are numerous reasons why this would fail spectacularly...

1) Gold has value and we could trade said gold all over the world for goods. There is a finite amount of gold in the world... the only way to debase its value is for a bunch of leprechauns to get a generous streak.

2) Flooding the country with gold is the same thing as flooding the country with savings.

Is that second that really exposes Bill for the economic illiterate that he is. GNP... GDP... what ever the hell they are calling their variable magic number machine now... has no more bearing on the money supply than the tooth fairy. Credit must be directly related to savings. The amount of savings supporting an economy is exactly the same as the amount of credit that should be available.

That shouldn't be a hard concept. Banks can only lend money that they actually have on deposit. Dig?

GDP is irrelevant.

Gold has value because we say it does. Just like oil. Just like diamonds. Just like Ferraris. It has value for the same reason anything has value... there is a demand for it. What I'm saying is... there is no such thing as "inherent value". Ask the grub eaters in New Guinea about oil. They won't give you a grub for it. They can't use it. There is no demand. Therefore there is no value. Nothing creates its one demand.

The US economy is royally screwed. It is screwed because we screwed it. No other country was required. China didn't have to come here and flood us with gold. We simply did what ALL countries do... we printed more and more and more money... until you may as well wipe your ass with 1 dollar bills. Resipsa argues that we can either enact a fiscally responsible government (he's ignoring the fact that such a thing has never existed for more than a decade or two if at all), or... well...his or hints at switching to the Gold Standard but he doesn't say it because its to scary for him.

Res is that guy driving down the road billowing black smoke... leaking oil all over the road... every 2 blocks he stops to add more oil... but he refuses to take his car to a mechanic... because it may cost a lot to get it fixed.

The pain is coming people. It cannot be avoided. Paper money doesn't work. This isn't a theoretical problem. Its a reality problem. Reality is... every government... every damned government... every one of them... has printed their currency into worthlessness.

No system is perfect. The Gold Standard is not perfect. Its just a trillion times better than the jackassery we have today.

Monday, April 07, 2008

Greenspan on Greenspan

What follows is Alan Greenspans critique on the Fed and its activites of the 1920s. Its interesting to note that the man himself turned out to make the exact mistakes he lambasts others for. Few people realize what made Greenspan good early in his early years at the Fed. In his youth he aproximated an Austrian. As he notes in the essay, its the real assets a society has that determine its credit limits... Austrians would say savings, but that is ultimately splitting hairs. He ran it on a virtual gold standard. He tracked the price of gold, and while he didn't use it at the sole indicator, it was usually the determining factor on rate control. If the price of gold was going up... he'd raise rates... if it went down... he cut them. Under such terms its difficult to complain to much about the fed, without relying on the old truism, "if men run it, they'll screw it up eventually". Of course... he did screw it up... which is why its an old truism. Funny thing about truisms... if they aren't... they never get old. But I digress... On to the essay... wherein we learn that Alan Greenspan's most effective critic is himself.


Capitalism: The Unknown Ideal.

An almost hysterical antagonism toward the gold standard is one issue which unites statists of all persuasions. They seem to sense - perhaps more clearly and subtly than many consistent defenders of laissez-faire - that gold and economic freedom are inseparable, that the gold standard is an instrument of laissez-faire and that each implies and requires the other.In order to understand the source of their antagonism, it is necessary first to understand the specific role of gold in a free society.

Money is the common denominator of all economic transactions. It is that commodity which serves as a medium of exchange, is universally acceptable to all participants in an exchange economy as payment for their goods or services, and can, therefore, be used as a standard of market value and as a store of value, i.e., as a means of saving.

The existence of such a commodity is a precondition of a division of labor economy. If men did not have some commodity of objective value which was generally acceptable as money, they would have to resort to primitive barter or be forced to live on self-sufficient farms and forgo the inestimable advantages of specialization. If men had no means to store value, i.e., to save, neither long-range planning nor exchange would be possible.

What medium of exchange will be acceptable to all participants in an economy is not determined arbitrarily. First, the medium of exchange should be durable. In a primitive society of meager wealth, wheat might be sufficiently durable to serve as a medium, since all exchanges would occur only during and immediately after the harvest, leaving no value-surplus to store. But where store-of-value considerations are important, as they are in richer, more civilized societies, the medium of exchange must be a durable commodity, usually a metal. A metal is generally chosen because it is homogeneous and divisible: every unit is the same as every other and it can be blended or formed in any quantity. Precious jewels, for example, are neither homogeneous nor divisible. More important, the commodity chosen as a medium must be a luxury. Human desires for luxuries are unlimited and, therefore, luxury goods are always in demand and will always be acceptable. Wheat is a luxury in underfed civilizations, but not in a prosperous society. Cigarettes ordinarily would not serve as money, but they did in post-World War II Europe where they were considered a luxury. The term "luxury good" implies scarcity and high unit value. Having a high unit value, such a good is easily portable; for instance, an ounce of gold is worth a half-ton of pig iron.In the early stages of a developing money economy, several media of exchange might be used, since a wide variety of commodities would fulfill the foregoing conditions. However, one of the commodities will gradually displace all others, by being more widely acceptable. Preferences on what to hold as a store of value, will shift to the most widely acceptable commodity, which, in turn, will make it still more acceptable. The shift is progressive until that commodity becomes the sole medium of exchange. The use of a single medium is highly advantageous for the same reasons that a money economy is superior to a barter economy: it makes exchanges possible on an incalculably wider scale.

Whether the single medium is gold, silver, seashells, cattle, or tobacco is optional, depending on the context and development of a given economy. In fact, all have been employed, at various times, as media of exchange. Even in the present century, two major commodities, gold and silver, have been used as international media of exchange, with gold becoming the predominant one. Gold, having both artistic and functional uses and being relatively scarce, has significant advantages over all other media of exchange. Since the beginning of World War I, it has been virtually the sole international standard of exchange. If all goods and services were to be paid for in gold, large payments would be difficult to execute and this would tend to limit the extent of a society's divisions of labor and specialization. Thus a logical extension of the creation of a medium of exchange is the development of a banking system and credit instruments (bank notes and deposits) which act as a substitute for, but are convertible into, gold.

A free banking system based on gold is able to extend credit and thus to create bank notes (currency) and deposits, according to the production requirements of the economy. Individual owners of gold are induced, by payments of interest, to deposit their gold in a bank (against which they can draw checks). But since it is rarely the case that all depositors want to withdraw all their gold at the same time, the banker need keep only a fraction of his total deposits in gold as reserves. This enables the banker to loan out more than the amount of his gold deposits (which means that he holds claims to gold rather than gold as security of his deposits). But the amount of loans which he can afford to make is not arbitrary: he has to gauge it in relation to his reserves and to the status of his investments.

When banks loan money to finance productive and profitable endeavors, the loans are paid off rapidly and bank credit continues to be generally available. But when the business ventures financed by bank credit are less profitable and slow to pay off, bankers soon find that their loans outstanding are excessive relative to their gold reserves, and they begin to curtail new lending, usually by charging higher interest rates. This tends to restrict the financing of new ventures and requires the existing borrowers to improve their profitability before they can obtain credit for further expansion. Thus, under the gold standard, a free banking system stands as the protector of an economy's stability and balanced growth. When gold is accepted as the medium of exchange by most or all nations, an unhampered free international gold standard serves to foster a world-wide division of labor and the broadest international trade. Even though the units of exchange (the dollar, the pound, the franc, etc.) differ from country to country, when all are defined in terms of gold the economies of the different countries act as one-so long as there are no restraints on trade or on the movement of capital. Credit, interest rates, and prices tend to follow similar patterns in all countries. For example, if banks in one country extend credit too liberally, interest rates in that country will tend to fall, inducing depositors to shift their gold to higher-interest paying banks in other countries. This will immediately cause a shortage of bank reserves in the "easy money" country, inducing tighter credit standards and a return to competitively higher interest rates again.A fully free banking system and fully consistent gold standard have not as yet been achieved. But prior to World War I, the banking system in the United States (and in most of the world) was based on gold and even though governments intervened occasionally, banking was more free than controlled. Periodically, as a result of overly rapid credit expansion, banks became loaned up to the limit of their gold reserves, interest rates rose sharply, new credit was cut off, and the economy went into a sharp, but short-lived recession. (Compared with the depressions of 1920 and 1932, the pre-World War I business declines were mild indeed.) It was limited gold reserves that stopped the unbalanced expansions of business activity, before they could develop into the post-World Was I type of disaster. The readjustment periods were short and the economies quickly reestablished a sound basis to resume expansion.

But the process of cure was misdiagnosed as the disease: if shortage of bank reserves was causing a business decline-argued economic interventionists-why not find a way of supplying increased reserves to the banks so they never need be short! If banks can continue to loan money indefinitely-it was claimed-there need never be any slumps in business. And so the Federal Reserve System was organized in 1913. It consisted of twelve regional Federal Reserve banks nominally owned by private bankers, but in fact government sponsored, controlled, and supported. Credit extended by these banks is in practice (though not legally) backed by the taxing power of the federal government. Technically, we remained on the gold standard; individuals were still free to own gold, and gold continued to be used as bank reserves. But now, in addition to gold, credit extended by the Federal Reserve banks ("paper reserves") could serve as legal tender to pay depositors.

When business in the United States underwent a mild contraction in 1927, the Federal Reserve created more paper reserves in the hope of forestalling any possible bank reserve shortage. More disastrous, however, was the Federal Reserve's attempt to assist Great Britain who had been losing gold to us because the Bank of England refused to allow interest rates to rise when market forces dictated (it was politically unpalatable). The reasoning of the authorities involved was as follows: if the Federal Reserve pumped excessive paper reserves into American banks, interest rates in the United States would fall to a level comparable with those in Great Britain; this would act to stop Britain's gold loss and avoid the political embarrassment of having to raise interest rates. The "Fed" succeeded; it stopped the gold loss, but it nearly destroyed the economies of the world, in the process. The excess credit which the Fed pumped into the economy spilled over into the stock market-triggering a fantastic speculative boom. Belatedly, Federal Reserve officials attempted to sop up the excess reserves and finally succeeded in braking the boom. But it was too late: by 1929 the speculative imbalances had become so overwhelming that the attempt precipitated a sharp retrenching and a consequent demoralizing of business confidence. As a result, the American economy collapsed. Great Britain fared even worse, and rather than absorb the full consequences of her previous folly, she abandoned the gold standard completely in 1931, tearing asunder what remained of the fabric of confidence and inducing a world-wide series of bank failures. The world economies plunged into the Great Depression of the 1930's.With a logic reminiscent of a generation earlier, statists argued that the gold standard was largely to blame for the credit debacle which led to the Great Depression. If the gold standard had not existed, they argued, Britain's abandonment of gold payments in 1931 would not have caused the failure of banks all over the world. (The irony was that since 1913, we had been, not on a gold standard, but on what may be termed "a mixed gold standard"; yet it is gold that took the blame.) But the opposition to the gold standard in any form-from a growing number of welfare-state advocates-was prompted by a much subtler insight: the realization that the gold standard is incompatible with chronic deficit spending (the hallmark of the welfare state). Stripped of its academic jargon, the welfare state is nothing more than a mechanism by which governments confiscate the wealth of the productive members of a society to support a wide variety of welfare schemes. A substantial part of the confiscation is effected by taxation. But the welfare statists were quick to recognize that if they wished to retain political power, the amount of taxation had to be limited and they had to resort to programs of massive deficit spending, i.e., they had to borrow money, by issuing government bonds, to finance welfare expenditures on a large scale.

Under a gold standard, the amount of credit that an economy can support is determined by the economy's tangible assets, since every credit instrument is ultimately a claim on some tangible asset. But government bonds are not backed by tangible wealth, only by the government's promise to pay out of future tax revenues, and cannot easily be absorbed by the financial markets. A large volume of new government bonds can be sold to the public only at progressively higher interest rates. Thus, government deficit spending under a gold standard is severely limited. The abandonment of the gold standard made it possible for the welfare statists to use the banking system as a means to an unlimited expansion of credit. They have created paper reserves in the form of government bonds which-through a complex series of steps-the banks accept in place of tangible assets and treat as if they were an actual deposit, i.e., as the equivalent of what was formerly a deposit of gold. The holder of a government bond or of a bank deposit created by paper reserves believes that he has a valid claim on a real asset. But the fact is that there are now more claims outstanding than real assets. The law of supply and demand is not to be conned. As the supply of money (of claims) increases relative to the supply of tangible assets in the economy, prices must eventually rise. Thus the earnings saved by the productive members of the society lose value in terms of goods. When the economy's books are finally balanced, one finds that this loss in value represents the goods purchased by the government for welfare or other purposes with the money proceeds of the government bonds financed by bank credit expansion.

In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. If there were, the government would have to make its holding illegal, as was done in the case of gold. If everyone decided, for example, to convert all his bank deposits to silver or copper or any other good, and thereafter declined to accept checks as payment for goods, bank deposits would lose their purchasing power and government-created bank credit would be worthless as a claim on goods. The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves.

This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists' antagonism toward the gold standard.