Currency Backed By Commodities

[20MillionDinar]

"Australia’s currency is backed by all of the minerals and commodities that are within its borders and in its soil and geological makeup."

If that's true, then why can't Iraq's currency be backed by oil in the ground?

Edited February 8, 2012 by 20MillionDinar

[thegente]

LINK?

[lotsofdinar]

Australia's total reserves are over $40 billion dollars. They have about 1 trillion AUD in circulation. Their exchange rate is .9 AUD to $1.

Edited February 8, 2012 by lotsofdinar

[thegente]

Found your other article 20Million, thx! Why would anyone neg me for simply asking for a link to a statement? idiot

[keepmwlknfny]

"Australia’s currency is backed by all of the minerals and commodities that are within its borders and in its soil and geological makeup."

If that's true, then why can't Iraq's currency be backed by oil in the ground?

You have some more info on this?

[thegente]

Here's the link 20Mil is talking about here...thought I'd bring it over before a bunch of idiots start neggin everyone who asks for it:

[JayP]

Here's the link 20Mil is talking about here...thought I'd bring it over before a bunch of idiots start neggin everyone who asks for it:

Thank you for finding this thegente. For the record, I gave you a + to even that out. Unfortunately, there are some out there that think that it is a negative thing to want to see all the details, or evidence on anything, and that is very unfortunate. I think that asking for a link when someone provides information is a very good thing, and wish more people would do the same. Maybe that will take some of the ammo away from those that wish to provide false information to people when they are called out to provide proof of what they say.

[HopefulTxn]

"Australia’s currency is backed by all of the minerals and commodities that are within its borders and in its soil and geological makeup."

If that's true, then why can't Iraq's currency be backed by oil in the ground?

The problem is that people are taking the term 'commodity currency' and twisting into something that it does not mean. A commodity currency does not mean that the currency itself has it's value backed by any commodity, but that the economy of that nation is heavily reliant on exports of certain items.

If you take a look at the Reserve Bank of Australia's financials, they use reserve assets to back the value of their currency.

If you look at this LINK (xls file) it states that their 'notes on issue', which seems to be the amount of currency they have of AUD in circulation is about 54 billion.

Compare that with this LINK which shows that they have about $49.75 billion in reserve assets (money, gold and SDR's).

Given the numbers provided by the RBA, it would seem the AUD is anything but a 'commodity backed currency'.

[thegente]

Thank you for finding this thegente. For the record, I gave you a + to even that out. Unfortunately, there are some out there that think that it is a negative thing to want to see all the details, or evidence on anything, and that is very unfortunate. I think that asking for a link when someone provides information is a very good thing, and wish more people would do the same. Maybe that will take some of the ammo away from those that wish to provide false information to people when they are called out to provide proof of what they say.

Thx Jayp...it was probably a blind-faith head-in-the-sand Okie disciple anyways...haha

[20MillionDinar]

The problem is that people are taking the term 'commodity currency' and twisting into something that it does not mean. A commodity currency does not mean that the currency itself has it's value backed by any commodity, but that the economy of that nation is heavily reliant on exports of certain items.

If you take a look at the Reserve Bank of Australia's financials, they use reserve assets to back the value of their currency.

If you look at this LINK (xls file) it states that their 'notes on issue', which seems to be the amount of currency they have of AUD in circulation is about 54 billion.

Compare that with this LINK which shows that they have about $49.75 billion in reserve assets (money, gold and SDR's).

Given the numbers provided by the RBA, it would seem the AUD is anything but a 'commodity backed currency'.

A fiat currency is any currency that is backed by government law and guarantee, the government’s money. Virtually every currency in the world is now a fiat currency as opposed to a commodity backed currency. Australia of course is a fiat currency, but it has become much more than that since the onset of the financial crisis, the fiscal implosion in the USA and accelerating growth rates in the developing world and their demand for raw materials. The Australian dollar seems now to occupy a place in between an official fiat currency which is backed by the government but whose value and security is determined more by the value of commodities: a defacto commodity backed currency or representative money. As I considered this I found an article from the UK Telegraph which says much the same thing:

Today, no currency in the world is on the gold standard – all money is “fiat” money.

However, Australia has significant resources of gold, uranium, iron ore, coal and many other important and valuable commodities. They are in the ground, not in a central bank, but this is the nearest thing the world has to the old gold standard. That’s why the Australian currency is so strong.

**Iraq doesn't necessarily have to have their currency "backed by commodities" but it could be very similar to how the AUD is in regards to commodities, that's all I am saying. It wouldn't be unheard of due to the fact that the Australian Dollar, New Zealand Dollar, Brazilian Real, and Mexican Peso all seem to move in the same direction as commodities.

Also, going solely off of a central bank's financials could be misleading. Just look at what happened last year when the Federal Reserve had it's first real audit since its inception. There was an additional 16 trillion USD given to other countries and banks! Think about that for a minute...

Our entire country's debt is about 14 trillion and this has been growing for about a century. Look at the above number again, 16 TRILLION USD! What do you call that? I would say our Federal Reserve's financials are misleading. Look at how we measure our inflation: http://dinarvets.com..._0entry846109 (please read it)

This proves that our numbers are misleading! If you don't see it then I am sorry, I know you are a logical thinker, but sometimes it is a little too logical. Just my opinion... Sometimes it helps to learn to think outside the box.

Edited February 8, 2012 by 20MillionDinar

[MrFnHappy]

The problem is that people are taking the term 'commodity currency' and twisting into something that it does not mean. A commodity currency does not mean that the currency itself has it's value backed by any commodity, but that the economy of that nation is heavily reliant on exports of certain items.

If you take a look at the Reserve Bank of Australia's financials, they use reserve assets to back the value of their currency.

If you look at this LINK (xls file) it states that their 'notes on issue', which seems to be the amount of currency they have of AUD in circulation is about 54 billion.

Compare that with this LINK which shows that they have about $49.75 billion in reserve assets (money, gold and SDR's).

Given the numbers provided by the RBA, it would seem the AUD is anything but a 'commodity backed currency'.

Thanks for the links.

54,000,000,000 x .9 = 48,600,000,000.

So from the information you provided, the Aussies are backing their currency 100+%

Hmmm, perhaps the Aussies cook their books like Iraq does........

[SgtFuryUSCZ]

Thanks for the links.

54,000,000,000 x .9 = 48,600,000,000.

So from the information you provided, the Aussies are backing their currency 100+%

Hmmm, perhaps the Aussies cook their books like Iraq does........

***///

you're beautiful, man!

Edited February 9, 2012 by SgtFuryUSCZ

[HopefulTxn]

Also, going solely off of a central bank's financials could be misleading. Just look at what happened last year when the Federal Reserve had it's first real audit since its inception. There was an additional 16 trillion USD given to other countries and banks! Think about that for a minute...

Our entire country's debt is about 14 trillion and this has been growing for about a century. Look at the above number again, 16 TRILLION USD! What do you call that? I would say our Federal Reserve's financials are misleading. Look at how we measure our inflation: http://dinarvets.com..._0entry846109 (please read it)

This proves that our numbers are misleading! If you don't see it then I am sorry, I know you are a logical thinker, but sometimes it is a little too logical. Just my opinion... Sometimes it helps to learn to think outside the box.

$16 trillion, and what do I call that? I would have to call that a swing and a miss if you were trying to hit the mark of what that issue was about. Just a heads up, if you think the $16 trillion related in any way to USD in circulation, I would suggest you start from square one on your research because you completely missed the point of what the uproar was about or what it entailed.

Thinking outside of the box is not a bad thing, but what started this conversation was not an issue based on that, but rather debating the misrepresentation of information. Simply put, yes Australia creates revenue from exporting commodities, and partly due to the current price of gold (and other exports) Australia is enjoying a trade surplus which is beneficial to both their economy and the value of their currency against others around the world. The connection between the commodities and the currency value is there, but it is an indirect relationship and not a direct one which would be the case if the AUD was actually 'backed by' commodities.

[War Eagle]

I understand obama wants the federal reserve to back the dollar with dog poop!!!