Money Doesn't Grow on Trees!

September 7, 2001

When we were kids, we wanted absolutely everything. Most of us came from families that may have been well off enough to pay the bills, buy a home and car, and even go to an occasional movie, or other amusement. However, children have no concept of wealth or economics. They cannot have everything their little hearts desire, because Mom and Dad can't afford to give them everything they want. The typical reply from my mean Mom or Dad was, "Don, money doesn't grow on trees…etc."

Lots of things grow on trees. Oranges, apricots, plums, apples, and various kinds of nuts and fruits. Trees give us shade, and lumber with which to build our homes. Trees take in carbon dioxide, and give off oxygen. We all need trees! It's too tragic that 175,000 acres of government trees are burning now. If they were privately owned, they wouldn't, but would be thinned, cared for, and nourished.

Well, (you know what's coming don't you?) in actuality, money does grow on trees! Trees are cut, pulverized, mixed with a solution made with water and other chemicals, heated, pressed, and presto! Paper comes out the other end of the machine. Uncle Sam, in his benevolence, keeps the tree farmers busy, just cutting, trucking, and selling. The paper making boys are kept busy too, making all that special paper from which those dollars are made. Uncle is very sophisticated, you see. He has mysterious little lines running through those bills, which are supposed to keep the counterfeiters at bay. And those glamorous engravings of those now dead presidents are on all the bills. Doesn't it just make you want to cry for joy and deep appreciation that Uncle Sam keeps turning out those fancy bills? Gee Dad, it's a twenty! Can't quite get seven pounds of butter with it now kid. It'll buy an ice cream cone in a few years. We should also appreciate the fact that Mr. Greenspan keeps watch over the privately owned Federal Reserve.

"Gosh, we are really lucky aren't we? Why Dad talks about making 75 cents an hour when he was a kid, and I am making ten dollars an hour doing the same thing! Uncle Sam really cares for his citizens, doesn't he? Grandad, before he died last fall, told me he made $3 a day. Look at how much better off I am, than was Dad and Grandad! And besides, the bills are counterfeit proof now, to keep those nasty crooks from printing them illegally. I feel like I'm in heaven with all the protections Uncle Sam provides me. Why my savings account is insured for $100,000, so the banks can't go broke again. Uncle Sam takes great care of the public lands, and allows me to pay just $5 to enter a local place that is so beautiful words cannot describe it. I'll bet everyone else in the world is envious of me." (from an unknown moron I invented)

America's living standards are about where they were when your Dad was born in the mid 1930's. He made 75 cents an hour in the fifties, but his gasoline cost twenty cents a gallon, he paid microscopic taxes, bought his home for $5,000, and went to the corner grocery store and bought a week's groceries for under ten bucks. He lived in a nice, large, safe, graffiti free city, and didn't have to commute from the suburbs. He didn't have alarms on his home and car, the air was clean, and the coins were made of silver. He could ride the trolley car to work and home for an unlimited ride pass, which cost a dollar a week, and he didn't have TV. He listened to the "radio" which had marvelous dramas, comedy, concerts, and the like, and made you use your imagination to picture the goings-on. TV was in its infancy then, but it was free, except for the commercials, and today, you pay $50 a month for your dish or cable, to get programming.

The "money" was also made of paper back then, just like it is now, only you could send your dollars in to the treasury and get real silver or gold for them. This is what is known as being "backed" by precious metals. Uncle Sam couldn't print dollars until there was gold and silver to "back" them. The pennies were made of real copper.

Today Uncle Sam can write all the checks he wants, and start all the programs he wants. He pays for them with the money that grows on trees. Uncle Sam now can hire all the people he wants to hire, and tell them to crack down on you if you misbehave. "Isn't it nice that Uncle Sam doesn't have to have that old gold and silver in his vaults to back the dollars? With the backing removed, he can help far more people! Some silly people, say that unbacked paper money is out of control, and becoming worthless, but that's a lie! How could a bill with a picture of Abraham Lincoln on it, become worthless? Silly! Just because prices have gone up a bit doesn't mean the money is going to become worthless. Just ask anyone, and they'll tell you! Robbers steal dollars, not gold. If gold is so neat, why don't the crooks steal the gold you have in your safe? Bah! It's worthless, and an ancient money that no one wants any more. Why, if gold and silver are so wonderful, why can't you go to the corner bank and buy some? Why doesn't the majority buy it? After all, that's democracy, and the majority is always right. You should just calm down, and sell that silly gold and silver, because it will never go up. I don't believe the price is far lower than it should be. It is right where it should be, just like other things such as milk, butter, and gasoline. I know, the cars cost 50 times what they did in Dad's time, but look at what they give you today. Air conditioning, power steering, power brakes, and automatic transmissions. Dad was pre-historic, and Granddad was even worse" (Same guy)

I am a simple kind of guy, and like to write in a simplistic way. No charts or graphs here, although I do love them. Just "down home" philosophy for me. When I say that "money grows on trees," stop and think what there is a shortage of, and what is scarce. All the gold ever mined in history, could be contained in a cube about 25 feet high, wide and deep. That's it. Are trees scarce? No, and as a matter of fact, there are far more trees in America, than when Columbus landed. Americans love trees. We have plenty of trees in the world, but not much gold.

The price of anything is determined by its supply and demand. Not many people wanted Hudsons and Nashes, (no wonder) so they went by the wayside. Everyone wants gold and silver jewelry, and that's why they are so expensive in currencies. The ounce of gold in a Krugerrand or American Eagle, if worked, could be made into a piece of fine jewelry worth thousands of dollars, or into a wire 22 miles long. Or it could sit in your safe place of storage and glitter and gleam and be stable money that won't burn or decay. Pieces of paper with ink on them in a mattress or bank just keep going down. When something has already lost 95-98% of its purchasing power in the last several decades, one would have to be a real optimist to think it could ever go up again. Go down slower? Maybe, but that is doubtful. Too many are being recklessly printed. The more of anything there is, the less they will be worth. Be it rare art, stamps, and books, or antiques of any kind, and now including Nashes and Hudsons. Things in limited supply have to go up in currencies.

Buy old wines and never open them. Buy antique furniture, especially walnut. Buy anything that is in short supply. I just got back from the Old Thresher's Reunion in Mt. Pleasant, Iowa. If you love machinery, as I do, you should try to get there on Labor Day Weekend next year. At Mt. Pleasant, you will find literally thousands of items of machinery that are no longer made, but due to their antiquity, are extremely valuable. They are all running and restored to perfection. From steam powered tractors, engines, locomotives, and even a carousel, to gasoline tractors, autos, engines, and every conceivable form of machinery you can imagine. There's an operating trolley line and narrow gauge railroad as well as a lot of things of interest to the little lady. Wonderful! These things are valuable because there are few of them. The point is that you should buy things that you love, but buy. Buy that antique dresser, gun, or car. Buy, buy, buy, but above all, get out of dollars. Close those savings accounts, and certificates of deposit. Get yourself something tangible that isn't made of paper. Get gold and silver, and take advantage of the outrageous manipulation that has been going on for a couple of years now. Take advantage of beneficial situations.

For those of you who read my screed, last week I wrote about "Sherman." Sherman was taken to Mt. Pleasant, and a few other places, and back. He got 15mpg at a steady 85mph, and performed flawlessly for 2900 miles. He won't be sold, but is a keeper. I'd much rather have Sherman than the $1200 he cost. Then this guy knocked on my door yesterday and wanted to sell three Krugerrands. I took pieces of paper with ink on them and exchanged them for those Krugs. Got out of paper and into a tangible. It can't happen often enough.

Nearly 40 percent of all gold ever mined was recovered from South African rocks.

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