The king is gone but he's not forgotten
This is the story of Johnny Rotten
It's better to burn out than it is to rust
The king is gone but he's not forgotten
Are the lyrics to the classic Neil Young song. Originally the King he was singing about was Elvis. I'd like to offer a little different twist to the cast of characters. The king in my scenario is America, the American people, our country and the bright shining beacon that once stood for hope, dreams and endless possibilities. Johnny Rotten will be played by none other than our spoiled brat frat boy.
The main character of my diary though, is Rust.
Curious as to why this is relevant?
Hey, Hey, My, My ... the USD may soon die.
Last week the US House passed bill H.R. 5512
The bill would require the U.S. Mint to switch from a zinc and copper penny, which costs 1.26 cents each to make, to a copper-plated steel penny, which would cost 0.7 cents to make, according to statistics from the Mint and Rep. Zack Space, D-Ohio, one of the measure's sponsors.
It also would require nickels, now made of copper and nickel and costing 7.7 cents to make, to be made primarily of steel, which would drop the cost to make the five-cent coin below its face value.
Some might ask what is joeshwingding ranting about pennies and nickels for? This is the kind of insignificant pocket change that is left at the counter of the local 7-11. "Insignificant?!" I bellow with a scornful rhetoric, "do you not understand?"
Jump in the wayback machine with me.
The 1943 Cent is made of 100% Steel, and is coated with a thin layer of zinc. The steel composition gives this coin it's silver looking surface. It is the ONLY US Penny that will "stick" to a magnet all others will not because they are made of copper and nickel.
When first introduced, these Strange cents were "shunned" by the general population they were often called "lead pennies", "lead cents", or "steelies". When these cents corroded, they looked like slugs, hence the nick name, "lead pennies."
Of course in 1943 we were in the middle of WWII, at that time the country was asked to make a sacrifice for the war effort. Copper was the primary metal for shell casings. So what does pocket change and shell casing have to do with anything? Ah, a bright question my inquisitive one.
Money has laws that make it money. No, I am not talking about its illegal to counterfeit, I am speaking about universal laws. These laws were discovered over the last five thousand years as the barter system became to cumbersome.
These laws are:
•Unit of Account- a unit in which goods and services can be related to one another.
•Medium of Exchange- money facilitates the exchange of goods and services and makes the economy efficient.
•Store of Value- joeshwingdings personal favorite. Money needs to retain its value. Money saved and spent later will still buy the same amount of goods and services at a later date. Said another way, it will not depreciate.
•Unit of deferred payment- Money that actually gains in value when saved and thus financing other capital projects that improve the well being of the economy by manufacturing goods and providing jobs.
Yeah, yeah Joeshwingding is there a point? Did you see anything about rusting?
Money has to meet all these laws or it is not money, it only poses as money. When money is made out of metal there is a cost associated to it and hence gives it its value. Society found metal suited this purpose because it could be minted in small enough sizes so as not to be cumbersome, still fit in a persons pocket making it portable and durable. An added benefit was certain metals didn't rust. Paper could be burned and destroyed with water. Shells could be crushed.
Those are the properties. Some people get hung up on how much money they have. Simply stated in quantity. I want to talk quality. What your money can by. Think about it, if you could go to the gas station and give the dude a fitski and fill up. Now that is purchasing power.
In 2001 the USD index was sitting at a high of 120. Today at the end of Johnny Rottens legacy the USD sits below 73. That means in the last 7 years the dollars you hold tight in your fist has lost 40% of its value. 40%! So much for Paulsons strong dollar policy.
Joeshwingding has written many diaries about inflation. Why? Because as obstinate as joeshwingding can be he wants to help you understand that it is the quality of money that is important. Yet, you still doubt joeshwingding? Lets take it to the web.
Dictionary.com defines inflation as "a persistent, substantial rise in the general level of prices related to an increase in the volume of money and resulting in the loss of value of currency".
American Heritage says inflation is "a persistent increase in the level of consumer prices or a persistent decline in the purchasing power of money, caused by an increase in available currency and credit beyond the proportion of available goods and services"
This is not the first time the US has seen this. Step into the wayback one more time. With a catchy little folk tune written about a period in American history and recorded by Blind Alfred Reid - The time was December 4, 1929 and the US was still reeling from the quite recent stock market crash.
"There once was a time when everything was cheap,
But now prices nearly puts a man to sleep.
When we pay our grocery bill,
We just feel like making our will --
I remember when dry goods were cheap as dirt,
We could take two bits and buy a dandy shirt.
Now we pay three bucks or more,
Maybe get a shirt that another man wore --
Tell me how can a poor man stand such times and live?"
Money is not suppose to rust. Rust is something that deteriorates. Corrosion that breaks down sturdy things. Friends of joeshwingding that live on the east coast and midwest know what rust can do to your car. Rust is unwanted, and you dont want it near your money.
Once money was made from gold and silver but the FED and US Government took that away from you because they could not spend beyond their limitations which was from taxes collected. Then it went to copper, and that was taken away from you in 1982 because copper became to valuable. Now nickel has become to expensive for US currency. The solution they now want to implement for joeshwingdings pocket change? To make currency that rusts. A forever degrading currency how appropriate for Johnny Rotten's legacy.