Monday, November 26, 2007
Canadian Pennies[Note: Welcome, Crooks and Liars readers. Thanks to Bob Morris of Politics in the Zeros for the link love. --TBV Crew]
I'm old enough to remember the good old days of the American dollar. My first trip to Europe was a shopper's paradise, I discovered Sephora, that amazing French perfume superstore, and when I converted my dollars to francs, I was delighted to learn that all of my purchases were 75 percent off. In most of Italy, the conversion was more difficult, it was something like 10,000 lire to a dollar, and everything seemed really expensive with all of those zeroes...but when I got home, and opened my credit card bill, I had hardly spent anything at all. Currency is a hard concept for me to grasp, many currencies, including our American dollar, used to be backed up by gold, meaning that 1 dollar was equivalent to a certain amount of gold, and if you brought your dollars to the US Treasury, you could trade them in for that amount of gold. But with that gold, if you ordered a pepperoni pizza, you would not be able to pay for it, or maybe you would, if the driver were willing to accept your piece of gold in exchange for a pizza, but certainly no change would be given, and you would end up not being hungry anymore, but perhaps you would have paid more than the pizza was worth. But what is a pizza worth? Let's say that you have saved up many little pieces of gold, but there is a severe shortage of pepperoni pizza. If you're starving, you can't really eat the gold. Maybe the pizza man already has gold, and knows that he can't eat it, and maybe won't trade you a pizza for all of your gold. Maybe he wants your neighbor's hot tub, or your set of golf clubs, or your kid's bike, since gas is really expensive.
Since America has stopped making things, things like cars and steel, things of substance, and has instead become a place that relies on other countries to make things for us, we have become the guy with the gold, who is hungry, but only has this currency to trade for food, and things like oil to keep us warm, and our nation moving. What happens when that currency fails? Our currency is worth less today than it was when I was shopping in Paris 8 years ago. Today, my dollars wouldn't buy me a quiche in Paris.
I remember counting cash at the end of the night at some Friday's or Bennigan's where I was working in the 90's. I would end up with Canadian pennies and nickels that I couldn't put in the bank deposit at the end of the night, and since they were worth much less than an American penny or nickel, I would toss them into the trash bin. Today, the Canadian dollar is worth more than the American dollar, and if you haven't been paying attention to the mounting monetary crisis facing the nation, then basically you're screwed. If the decline of the dollar continues much longer, we will all be really hungry, and the dollar will not buy us anything to eat.
I wish I had saved all of those Canadian pennies.
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No subject for immortal verse
That we who lived by honest dreams
Defend the bad against the worse."
-- Cecil Day-Lewis from Where Are The War Poets?
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