Tinfoil Hats And Federal Reserve Law Enforcement Officers

The problem with being paranoid is you might be right and therefore not paranoid at all.  This really takes the fun out of things.

Case in point, “fiat currency”.  In a sane world you’d just have “money”.  Money makes sense.  Why?  Because hauling around a bushel of soybeans to trade for a case of PopTarts would suck.  I’m happy with the idea of a medium of exchange.  Unfortunately I’m not so happy with the concept of “fiat currency”.  “Fiat currency” is the technical term for little slips of paper (or numbers in accounts) that have no value whatsoever other than a governmental blessing.  The only reason I can use cash to buy cookies or cocaine is because the Government says “these slips of paper are totally awesome and nothing like that ream of paper you just bought at Office Max”.  There’s one other part of that belief.  If the people (en masse) start thinking currency is just paper… it’s game over.

Fiat currency is an impolite phrase.  Nobody likes it.  It’s something you’ll never hear uttered by most Americans.  It also sounds silly right up to the point when it doesn’t.  Like now.  The debt is $15,981,575,234,553.39 and during bailouts in the last few years “totally awesome pieces of paper” have been created in such number that the Government couldn’t even physically print them.  Not that they didn’t feel like it.  It’s simply not possible.  Even if you get a discount on cheap photocopy paper and have oh I don’t know… big bunch of factories that make money there is too much imaginary money to print it.  When dollars are wished into being so fast that physically representing them on paper is impossible I get nervous.  This makes me sound paranoid when I get together with the family for Thanksgiving.  It’s tough being a Curmudgeon.

Even as I write this I realize that at least one other tinfoil hat wearing American will see the flaw in the above paragraph.  You see I referred to the U.S. Mint as the Government’s big bunch of factories that make money.  Other people who think too much about fiat currency  (and therefore at least sound paranoid) will surely note that mint only makes coins…which are only good if you want to buy a soda at a vending machine.  All the paper money is represented by Federal Reserve Notes.  They’re made by the Federal Reserve.  Who cares right?

Well there’s this part about the Federal Reserve being somewhat independent of the U.S. Government.  Don’t trust me.  Here’s what Wikipedia says :

“…the Federal Reserve is independent within government in that ‘its monetary policy decisions do not have to be approved by the President or anyone else in the executive or legislative branches of government.'”

I can quote more authoritative sources than Wikipedia but if you’ve read this far you already knew it.  I don’t see why my savings should be denominated in slips of paper that can be invented (it’s not even necessary to print it) by people who answer to darned near nobody and can tell the President and both houses of congress to kiss their ass.  It’s as if you renamed “Big Donny’s Pizza” into “Federal Pizza” and started making imaginary pizzas…and I had to eat them.

Of course none of this is new.  We haven’t been on the gold standard for years and the Fed has invented money out of thin air since then.  This is why stuff that you’d buy for $1 in 1913 costs about $23 now.  (You can have fun with inflation… I just picked that as a random example.)  There’s no law that says you’ve got to print money until dollars are worth less every year for decades on end.  It just seems to be how things go.  I suppose the ability to “invent” money is as hard to resist as the power of Sauron.

Why mention all this?  Because I wanted to list a few things that:

  • Are true.
  • Don’t sound true (even though they are).
  • Sound really paranoid when you discuss it (even though they are true).
  • Freak me out.

There’s something else that is true and yet sounds nutty. The Federal Reserve, which is quasi-independent of the Government and can hand me a pinecone and tell me it’s a $50 dollar bill if they wish… have their own police force.  They are called Federal Reserve Law Enforcement Officers.  They’re a relatively new thing; they were created following September 11, 2001.  They have cool badges and guns and all the groovy stuff you’d expect.

You’ve got to be kidding me. A police force that doesn’t answer to the president or anyone else and employed by a system that can invent it’s own money.  Am I the only one that thinks this is a bad idea?  Also why should a bank to have it’s own police force rather than using something like Federal Marshals?  What’s next?  Should WalMart have it’s own Air Force?

So far nothing has become of it.  Still I think it’s a bad thing.  Does it make me hopelessly paranoid?

Also if you already knew about this… do you freak people out at Thanksgiving?  Just askin’.

About Adaptive Curmudgeon

I will neither confirm nor deny that I actually exist.
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8 Responses to Tinfoil Hats And Federal Reserve Law Enforcement Officers

  1. KA9VSZ says:

    I don’t freak them out- they do things like drink municipal water supply disinfectant in order to kill imaginary parasites that an internet doctor says they have. Besides, talking guvamint and monetary stuff is depressing. Wanna come to my place for some turkey?

  2. Homebrewer says:

    You yanks don’t have just another fiat currency, but the first and hopefully last world reserve national fiat currency. Greenspan already blew it up – but foreign central banks have to store the bloody things so the dams of USD foreign dollars haven’t flooded back home – yet. That’s changing – see China’s many bilateral trade agreements.

    Does QEternity seem a little bit out the Zimbabwean play-book of how to manage a currency? No surprise, because the US will eventually monetize all of the debt, and print their enormous deficits, until the end of the dollar.

    Still got that tin foil hat? I’m calling all out hyperinflation in the the US, probably the greatest hyperinflation the world has ever seen. Wheel-barrow carrying, wall paper covering, toilet paper substituting, 100 trillion dollar bread, hyperinflation. With crazy bank notes and everything.

  3. kx59 says:

    If I was to have that conversation with my democrat in-laws, their response would be “Nuh Uh, your making that up.”
    I wonder if the Federal Reserve Police Force were to “arrest” me, could I file kidnapping charges against them? I have this really sick feeling that the answer is “no”.

  4. MSgt B says:

    You got Quote of the Week off this one.

    I’m linking it.

    Keep it coming.

  5. Wolfman says:

    I used to freak out both my inlaws (dedicated long time dems and old hippies) and my family. Then a funny thing happened. About a year and a half ago, they started believing me. Not sure what caused it, but all of a sudden, they started seeing the frost on the fringes of hell and realized, hey, this mother really COULD freeze over. I think THAT scares me more than anything.

    And I second the opening line for qotd.

  6. Homebrewer says:

    “the Government couldn’t even physically print them. Not that they didn’t feel like it. It’s simply not possible.”

    This is where the fancy bank notes come in. Can’t get enough printers? Add a zero on the end of the bank notes and suddenly your printers are ten times faster, another zero 1 hundred times faster.

    Here’s an interesting example of not-physically-possible printing. Zimbabwe ended up with 100 trillion dollar notes. When you convert that into the original ZIM $ with all of the zero’s they removed at various stages, it turns out that the final notes where convertible for 10^24 original ZIM $s That’s more than a Avogadro’s number of ZIM dollars, the number of atoms in 12 grams of carbon.

    If you went into a bank and tried to exchange a 100 trillion dollar note for 10^24 original 1 dollar notes, it would require an area greater than the solar system to store them.

    As Greenspan says, the US will never ever default, because the can just print.

  7. Homebrewer says:

    Sorry, relevant part is at 50 seconds above.

  8. Joe in PNG says:

    I believe Brazil was just stamping zeros on old notes… and then would just start over with a new currency.

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