Will dollar pegged to gold again?

This is an article by Llewellyn H. Rockwell, Jr., cited by member of US House of Representatives, Ron Paul, when he introduced a bill to abolish Federal Reserve. Althogh this was written in 2002, this article has close connection to today's ongoing crisis. Please read and comment.

WHY GOLD?
By Llewellyn H. Rockwell, Jr.

As with all matters of investment, everything is clear in hindsight. Had you bought gold mutual funds earlier this year, they might have appreciated more than 100 percent. Gold has risen $60 since March 2001 to the latest spot price of $326.

Why wasn't it obvious? The Fed has been inflating the dollar as never before, driving interest rates down to absurdly low levels, even as the federal government has been pushing a mercantile trade policy, and New York City, the hub of the world economy, continues to be threatened by terrorism. The government is failing to prevent more successful attacks by not backing down from foreign policy disasters and by not allowing planes to arm themselves. These are all conditions that make gold particularly attractive.

Or perhaps it is not so obvious why this is true. It's been three decades since the dollar's tie to gold was completely severed, to the hosannas of mainstream economists. There is no stash of gold held by the Fed or the Treasury that backs our currency system. The government owns gold but not as a monetary asset. It owns it the same way it owns national parks and fighter planes. It's just another asset the government keeps to itself.

The dollar, and all our money, is nothing more and nothing less than what it looks like: a cut piece of linen paper with fancy printing on it. You can exchange it for other currency at a fixed rate and for any good or service at a flexible rate. But there is no established exchange rate between the dollar and gold, either at home or internationally.

The supply of money is not limited by the amount of gold. Gold is just another good for which the dollar can be exchanged, and in that sense is legally no different from a gallon of milk, a tank of gas, or an hour of babysitting services.

Why, then, do people turn to gold in times like these? What is gold used for? Yes, there are industrial uses and there are consumer uses in jewelry and the like. But recessions and inflations don't cause people to want to wear more jewelry or stock up on industrial metal. The investor demand ultimately reflects consumer demand for gold. But that still leaves us with the question of why the consumer demand exists in the first place. Why gold and not sugar or wheat or something else?

There is no getting away from it: investor markets have memories of the days when gold was money. In fact, in the whole history of civilization, gold has served as the basic money of all people wherever it's been available. Other precious metals have been valued and coined, but gold always emerged on top in the great competition for what constitutes the most valuable commodity of all.

There is nothing intrinsic about gold that makes it money. It has certain properties that lend itself to monetary use, like portability, divisibility, scarcity, durability, and uniformity. But these are just descriptors of certain qualities of the metal, not explanations as to why it became money. Gold became money for only one reason: because that's what the markets chose.

Why isn't gold money now? Because governments destroyed the gold standard. Why? Because they regarded it as too inflexible. To be sure, monetary inflexibility is the friend of free markets. Without the ability to create money out of nothing, governments tend to run tight financial ships. Banks are more careful about the lending when they can't rely on a lender of last resort with access to a money-creation machine like the Fed.

A fixed money stock means that overall prices are generally more stable. The problems of inflation and business cycles disappear entirely. Under the gold standard, in fact, increased market productivity causes prices to generally decline over time as the purchasing power of money increases.

In 1967, Alan Greenspan once wrote an article called Gold and Economic Freedom. He wrote that:

"An almost hysterical antagonism toward the gold standard is one issue which unites statists of all persuasions. They seem to sense--perhaps more clearly and subtly than many consistent defenders of laissez-faire--that gold and economic freedom are inseparable, that the gold standard is an instrument of laissez-faire and that each implies and requires the other. . . . This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights."

He was right. Gold and freedom go together. Gold money is both the result of freedom and its leading protector. When money is as good as gold, the government cannot manipulate the supply for its own purposes. Just as the rule of law puts limits on the despotic use of police power, a gold standard puts extreme limits on the government's ability to spend, borrow, and otherwise create crazy unworkable programs. It is forced to raise its revenue through taxation, not inflation, and generally keep its house in order.

Without the gold standard, government is free to work with the Fed to inflate the currency without limit. Even in our own times, we've seen governments do that and thereby spread mass misery.

Now, all governments are stupid but not all are so stupid as to pull stunts like this. Most of the time, governments are pleased to inflate their currencies so long as they don't have to pay the price in the form of mass bankruptcies, falling exchange rates, and inflation.

In the real world, of course, there is a lag time between cause and effect. The Fed has been inflating the currency at very high levels for longer than a year. The consequences of this disastrous policy are showing up only recently in the form of a falling dollar and higher gold prices. And so what does the Fed do? It is pulling back now. For the first time in nearly ten years, some measures of money (M2 and MZM) are showing a falling money stock, which is likely to prompt a second dip in the continuing recession.

Greenspan now finds himself on the horns of a very serious dilemma. If he continues to pull back on money, the economy could tip into a serious recession. This is especially a danger given rising protectionism, which mirrors the events of the early 1930s. On the other hand, a continuation of the loose policy he has pursued for a year endangers the value of the dollar overseas.

How much easier matters were when we didn't have to rely on the wisdom of exalted monetary central planners like Greenspan. Under the gold standard, the supply of money regulated itself. The government kept within limits. Banks were more cautious. Savings were high because credit was tight and saving was rewarded. This approach to economics is the foundation of a sustainable prosperity.

We don't have that system now for the country or the world, but individuals are showing their preferences once again. By driving up the price of gold, prompting gold producers to become profitable again, the people are expressing their lack of confidence in their leaders. They have decided to protect themselves and not trust the state. That is the hidden message behind the new luster of gold.

Is a gold standard feasible again? Of course. The dollar could be redefined in terms of gold. Interest rates would reflect the real supply and demand for credit. We could shut down the Fed and we would never need to worry again what the chairman of the Fed wanted. There was a time when Greenspan was nostalgic for such a system. Investors of the world have come to embrace this view even as Greenspan has completely abandoned it.

What keeps the gold standard from becoming a reality again is the love of big government and war. If we ever fall in love with freedom again, the gold standard will once more become a hot issue in public debate.
----
-

US Public Debt in National Debt Clock

This is a portrait of National Debt Clock, showing constantly updated US public debt and each American family shares of that debt(picture taken in April 19, 2008). This clock is located at Sixth Avenue (Avenue of the Americas) in Manhattan, New York City. Its Seymour Durst, who wanted to highlight US public debt, on 1989, sponsoring the idea to install the first clock on 42nd Street close to Times Square. In 2004, the clock was replaced by the new identical present clock. Seymour Durst who concerned with US public debt erected the first clock when US public debt was still around US$ 3 trillion. Now the clock that outlived Seymour Durst (died in 1995) is showing US$ public debt exceeds US$ 10 trillion, with each American family share US$ 86 thousand (It had run out its number). Seymour's son Douglas taking over responsibility for the clock through the Durst Organization.

First clock which could not run backward was dismantled on 2004 from 42nd Street and replaced by new clock which could run backwards on Durst Building, a block away from its original location (on at 1133 Avenue of the Americas (Sixth Avenue)). The clock was mounted on side wall of building facing W 44th street. This clock run out its digit on September 30, 2008, when the debt exceeded US$ 10 trillion. An overhaul to add two more digits was planned and expected to be completed in 2009.

Well, this clock has a role as symbol or metaphor, especially when the value is constantly increasing. Even if there are many arguments that even if US public debt is largest of the world, its ratio to GDP is 73%, Japan more than 100%, etc., etc., …. Living in land of debt is not so comfortable. Above is a real time US Public Debt on US National Debt Clock.org

-

Origin of the x symbol in algebra

In algebra, x is symbol for a number with unknown value, commonly denotes an unknown variable. Although other symbols are applicable, x remain the most common symbol. How is the origin of this symbol of x.

Muhammad ibn Musa Al-Khwarizmi, in his book Algebra, used the word شَيْءٌ (spelled sha-i-oon), meaning thing or something, for an unknown variable. This was taken to Old Spanish with pronunciation “šei,” which was written xei, and soon abbreviated to x. Spanish pronunciation of x changed since this, x is pronounced like ش in Arabic (the influence reached English too, x in first letter of a word is pronounced like ش, like in xylem, Xerox, xenon) . Other sources say that this x is an abbreviation of Latin causa, translated form Arabic شيء. This habit was the origin of using letters to represents quantities in algebra.

ABOLISH THE FEDERAL RESERVE: A Bill Introduced by Congressman Ron Paul

I have not found any ideas to write, so I post this speech of Ron Paul about his introduction of bill to abolish The Fed, please enjoy!

Congressman Ron Paul
U.S. House of Representatives
September 10, 2002

ABOLISH THE FEDERAL RESERVE

Mr. Speaker, I rise to introduce legislation to restore financial stability to America's economy by abolishing the Federal Reserve. I also ask unanimous consent to insert the attached article by Lew Rockwell, president of the Ludwig Von Mises Institute, which explains the benefits of abolishing the Fed and restoring the gold standard, into the record.

Since the creation of the Federal Reserve, middle and working-class Americans have been victimized by a boom-and-bust monetary policy. In addition, most Americans have suffered a steadily eroding purchasing power because of the Federal Reserve's inflationary policies. This represents a real, if hidden, tax imposed on the American people.

From the Great Depression, to the stagflation of the seventies, to the burst of the dotcom bubble last year, every economic downturn suffered by the country over the last 80 years can be traced to Federal Reserve policy. The Fed has followed a consistent policy of flooding the economy with easy money, leading to a misallocation of resources and an artificial "boom" followed by a recession or depression when the Fed-created bubble bursts.

With a stable currency, American exporters will no longer be held hostage to an erratic monetary policy. Stabilizing the currency will also give Americans new incentives to save as they will no longer have to fear inflation eroding their savings. Those members concerned about increasing America's exports or the low rate of savings should be enthusiastic supporters of this legislation.

Though the Federal Reserve policy harms the average American, it benefits those in a position to take advantage of the cycles in monetary policy. The main beneficiaries are those who receive access to artificially inflated money and/or credit before the inflationary effects of the policy impact the entire economy. Federal Reserve policies also benefit big spending politicians who use the inflated currency created by the Fed to hide the true costs of the welfare-warfare state. It is time for Congress to put the interests of the American people ahead of the special interests and their own appetite for big government.

Abolishing the Federal Reserve will allow Congress to reassert its constitutional authority over monetary policy. The United States Constitution grants to Congress the authority to coin money and regulate the value of the currency. The Constitution does not give Congress the authority to delegate control over monetary policy to a central bank. Furthermore, the Constitution certainly does not empower the federal government to erode the American standard of living via an inflationary monetary policy.

In fact, Congress' constitutional mandate regarding monetary policy should only permit currency backed by stable commodities such as silver and gold to be used as legal tender. Therefore, abolishing the Federal Reserve and returning to a constitutional system will enable America to return to the type of monetary system envisioned by our nation's founders: one where the value of money is consistent because it is tied to a commodity such as gold. Such a monetary system is the basis of a true free-market economy.

In conclusion, Mr. Speaker, I urge my colleagues to stand up for working Americans by putting an end to the manipulation of the money supply which erodes Americans' standard of living, enlarges big government, and enriches well-connected elites, by cosponsoring my legislation to abolish the Federal Reserve.

Gold: The Once and Future Money

Above is the title of book by Nathan Lewis, an senior economist in an Asset Management firm in New York. He actively writes for popular financial media, Financial Times and The Wall Street Journal.

His book has three chapters, first chapter give us details about money in every forms, second about history of money in US, and the third, explaining currency crisis across the world, including Asian crisis on last decade of 1990s. The interesting part of this book is his conclusion that there, even if it will need a period of years of even tens of years, will be an end of era of paper money. The world has no other choice other than return to hard currency. The future hard currency will based on gold, just like in past.

John Naisbitt – the one regarded as ‘god’ of modern economics – in his book, Mind Set, has predicted the future of paper money. According to him, the last monopoly abandoned by mankind is monopoly of paper money issued by a country. Society who do not believe paper money will purchase private currency, the one has intrinsic value by nature.

There many reasons to disagree with those two economist above, but please just think like this. If someone will give of buy from us, and he offers payment in money or barter in gold with same value, what is our wise choices? What our teacher teach us in economics class sure will tell us the right one.

Hyperinflation, something ever happen in fiat money only

In the term of economics, the term of “hyperinflation” is an out of control inflation. Price is ascending uncontrollably as a currency is losing its value rapidly. The current Zimbabwe economics crisis can be categorized as hyperinflation.

According to International Accounting Standard, these four factors can trigger hyperinflation in a country:

• People prefer wealth in non-monetary assets or in more stable foreign currency. Local currency is vastly spent to commodities to maintain its value.

• People regard monetary amount not on local currency but in relatively stable foreign currency. Price is rooted to foreign currency.

• Sales and purchases on credit take place at prices that compensate for the expected loss of purchasing power during the credit period, even if the period is short.

• Interest rates, wages and prices are linked to a price index and the cumulative inflation rate, in three years or more exceed 100%.

Since paper money (fiat currency) is far easier to be printed than minting hard currency from previous metals, sometimes central banks unwisely running printing machine over limits. Money is printed exceeding demand and supply of commodities and services, so there is massive and rapid increase in the amount of money, which is not supported by growth in the output of goods and services. Historically, there were episodes in countries experiencing hyperinflation in which there are returns to hard money, a money whose value is intact by nature (like gold silver, and other commodities). Older economies would revert to hard money or even barter when the money is excessively devalued. In this condition, gold has a stable value since a government printing money has less control of its supply.

There some unique thing happen in hyperinflation. Printed value in money reaches million or even billion. Also please look at above picture, a woman in German, in 1920s, feeding amount of paper money to her tiled stove, money is worthless than firewood. So burning money is cheaper than buying paper and it can last longer.

-

Socialism for the rich and capitalism for the poor

Regarding bailout of US financial system, a question has occurred everywhere. How could a promoter of capitalism take a policy that only occur in socialism. Why don’t US government leave all of the problem to market mechanism? If capitalism is analog to a religion, this policy is analog to apostasy.

Long before, there was a prediction that in advanced capitalist societies, there would be a policy to assure that more resources flow to the riches than the poors, and capitalist political economy toward large corporations will allow them to privatize profits and socialize losses. The summary is “Socialism for the rich and capitalism for the poor.” Andrew Young and Martin Luther King Jr. had stated this in many occasions of their speeches. Noam Chomsky criticized application of free market, he argued that this system imposes more risk to lower class. He cited that, “the free market is socialism for the rich—[free] markets for the poor and state protection for the rich.”

This is so ironic in my eyes. If US actually committed “apostasy” from capitalism, is this system strong enough to face challenges in near future? Many enterprises promoted free market across the world, but when this situation comes, they demand governments to grant protection.

Fahrenheit 9/11 Sequel: A new Work of Michael Moore

Michael Moore had stated that he planned to make a sequel to his successful Fahrenheit 9/11. Paramount Vantage and Overture Films will co-finance and co-produce this documentary that will do in 2009. The plan is it will be released in mid-2009.

Nick Meyer from Vantage Topper claims that this documentary will have global appeal. Most people expect that Moore will pick up anything what Fahrenheit 9/11 left off. The expected details are detailing the ongoing Iraq War, the falling approval rating of George W. Bush, and the economic crisis of 2008, or even more.

I had seen his two successful movies, Fahrenheit 9/11 and Sicko. I only can say that he is a great and talented filmmaker. His three documentary films is in the top five high grossing documentary film across time. It is not strange that people expect more in his new film. This film is titled Fahrenheit 9/11 ½. “Fifty-one percent of the American people lacked information (in this election) and we want to educate and enlighten them,” Moore said in Thursday’s edition of Variety. “They weren’t told the truth. We’re communicators and it’s up to us to start doing it now.”

Gresham Law and Ibnu Taimiyya in Economic Thought

Gresham Law is attributed to Sir Sir Thomas Gresham (1519 – 1579), an English financier in Tudor times. It simply stated “bad money drives out good.” This law is specifically applies if there two forms of money in market (especially commodity money), with establishment of force by a ruler, are forced to have face value in fixed ratio for marketplace transaction. This condition will drives out the good from people.

Gresham law defines good money and bad money. Good money is a money that has so little difference between its nominal and commodity value. Bad money is money that has substantial difference between its nominal and commodity value (fiat money is included in bad money). In the sense of Gresham law, fiat money is bad money because its commodity value is so little, almost zero. Fiat money relies entirely to government edicts for its legality. Since the amount of fiat currency is constantly increased through fractional reserve banking system, its value will tend to diminish across time.

Let gold coin (whatever in the form of gold dinar, Krugerrand (South Africa) or the American Gold Eagle (United States)) is good money and fiat currencies are bad money. In practice (assume gold coin is a legal tender like paper money), customer will prefer to pay using fiat currencies and keep the gold money for themselves because gold is more precious than paper money. Gold will gradually vanish from circulation because selfish people are stockpiling them. That is why it defines that “bad money drives out good.” Human has a selfish part in them by nature.

This had been stated long been before Gresham era by Ibnu Taimiyya, a sunni muslim scholar. Here he said:

If the ruler cancels the use of a certain coin and mints another kind of money for the people, he will spoil the riches (amwal) which they possess, by decreasing their value as the old coins will now become merely a commodity. He will do injustice to them by depriving them of the higher values originally owned by them. Moreover, if the intrinsic value of coins are different it will become a source of profit for the wicked to collect the small (bad) coins and exchange them (for good money) and then they will take them to another country and shift the small (bad) money of that country (to this country). So (the value of) people's goods will be damaged.

This applied in condition of two forms of money are legal tender. So, in today era, when gold is not a legal tender by law, a person must make a choice. When government continue to use fiat currency, do anything to save ourselves is not a selfish action.

-

Why do Bretton Woods System II (if any) have a possibility of failure?

Fiat money was a currency evolved from nothingness, completely not backed by gold. It can be in the form of paper money, accounting entry in banks, or even merely bit data in computer. It surely is worthless, but there are laws which impose a value to this worthless being. So, even if fiat money is worthless, it become legal tender in trade, payment, etc. because there laws in many countries backing. (fiat is come from Latin word that meaning let it be done).

This money became universally and gradually accepted post Bretton Woods System. If nothingness is forced to become a reality being, when the time comes, then it will break into pieces. We are not The Almighty God.

Last month, in pre-G-20 Summit in Washington, President of French, Nicolas Sarkozy proposed the necessity to re-establish Bretton Woods System, say Bretton Woods II that re-enacting gold standard. If the first failed, the incoming second surely will fail too if it repeats the mistakes committed by the first. These rules must be fulfilled if there is a will not to repeat a failure:

• Stockpiling money and commodities is forbidden. This ensures justice among mankind.
• There shall no legalities to make interest from money. This practice has been destroying the world.
• Gold may not be shaped in to unnecessary things like glass, plate, or any feasting equipments.
• Wealth must always circulate among mankind. Wealth must not only circulate among wealthy people.

Gold Price Post Bretton Woods System

Here I have data of gold price after Nixon unilaterally abandoned gold standard I 1971. In fact gold price began to rise in market since 1968. More and more US government spending abroad to fund military expenditures and investment had drove out dollars outside USA. So many countries demanded Uncle Sam ‘promise to pay’ (according to Bretton Woods agreement about convertibility US$ to gold), French did asked this and did acquired a large amount of gold.

First, I tried to fit this data to a curve using curve fitting method (using numerical analysis). But I stopped in the middle of process because it was too complicated. Fitting it to three degree polynomial equation needed us to solve linear equation with four variables. The integer is too large, made me chose to stop.

Well, coarsely we can see now that the chart is similar to three degree polynomial equation (cubic). This does not mean that gold value is increasing, it is just fiat currency has been losing its value. Post Bretton Woods, dollars value is getting worthless. And may be next year the value will be falling uncontrollably.

Robustness of Money in Facing Crisis

There are two factors to measure the strength of money. First, its strength through time and second, its strength facing storm of economic crisis. These two if the key to measure robustness of money. If a currency fails to pass the test using these two factors, that money is weak, does not have strength at all.

Money has three functions (according to lecture from our teachers), as medium of exchange to avoid inefficiency of barter system, as divisible, fungible, and countable unit of account, and the last, as store of value. Today’s fiat money fail to fulfill the last function of money as store of value because this fiat money (whose value is not backed by gold) can not to be reliably saved, stored, and retrieved — and be predictably useful when it is so retrieved. Today’s nominal values is different with nominal values at 10 years ago and forward.

So today’s money surely does not have strength at all. Almost like robustness of rotten and weakly maintained wooden building facing storm and earthquake. Coarse observation can be viewed from price of gold per troy ounce since abandonment of gold standard post Bretton Woods System. In 1971, gold price was US$ 41.25 in market (officially US$ 35), today gold price is around US$ 800. The value of US dollars has much decreased, and still continuing.

Nixon Shock (Cancellation of Bretton Woods System by USA)

In 1971, unilaterally, President of United States Richard Nixon canceled Bretton Woods System, i.e. stopped direct convertibility of US dollars to gold. This was mean that gold reserves of USA was not sufficient for backing up US dollars. Starting from this year, gold price rose dramatically. When in the last year of Bretton Woods system, gold price was US$ 41.25 in market (officially US$ 35), today gold price is around US$ 800.

Well, Nixon did this with multiple reasons. One of them to be blamed other than not sufficiently enough of gold reserves is much spending for Vietnam War (this war was running balance of payment deficit and so is trade). This war drove out US dollars abroad to fund nation's military expenditures and private investments. The excessive amount printed dollars made other nations demand fulfillment of USA promise to pay, demanding gold in exchange of US dollars (because Bretton Woods Agreement said so). So, Nixon started the process of abandonment of Bretton Woods System and after his reign, in 1976, all of nations floated their currency. They can not say no to Uncle Sam.

Even in the eyes of lay people like me, this was analogical to curing cancer with painkiller. Sure the pain would fade, but the pain would occasionally appear again and the necessity of painkiller was increasing, and eventually when the time of painkiller was not work came, a disaster emerged. I feel that economic crisis of 2008 is only beginning. Long day of grim world is awaiting us.

Prediction of Gold Price from Citigroup

Last month, from The Telegraph, Citigroup released its prediction to gold price. Originally, this is just internal notes from Citigroup to its clients, stated that there is a possibility that gold price will reach US$ 2,000 per troy oz in two years forward. The possibility is on the end of 2009. This prediction was not denied, even explicitly stated by Citigroup’s Chief Technical Strategist, Tom Fitzpatrick.

According to Fitzpatrick, central banks have flooded monetary system with liquidity. Now, trillion dollars of money is spreading like dust, seeking places to drop down. After this, the amount of money and earthquake of inflation will emerge, something never occurred in the past. Still from Fitzpatrick, this money flood printed by central banks will result on peaking inflation or depression spiral, even riot or war in extreme. Whatever extreme that will emerge, gold price is increasing. Sadly, former Chairman of Federal Reserve on 1979-1987, Paul Volcker, has similar analysis. Volcker is newly appointed Chairman of Economic Recovery Advisory Board by President Elect Barrack Obama. He said that something revealed in 2008 economy crisis is financial system failure he never experienced during his life before.

It seem that the world is getting more and more grim from this day forward, so save yourselves and your loved ones dude!

iPod Nano, the highest-selling MP3 player in history

When I hear the word, Microsoft, the next word I have in my head is Windows Operating System, also piracy over Windows that even reach 80% and more in developing countries. A few years ago, when I hear Apple Inc. or saw its partly bitten apple logo, my mind almost immediately caught a word, Mac OS, an operating system. But these days almost long gone, today when I hear, read, or write Apple Inc., what I have in mind is iPod, a portable media player released by Apple Inc. since October 23, 2001.

Well, I am not a music maniac, but that does not mean that I am not interested. Over 150 million units was sold worldwide as of March 2008. On 2005, The first generation of iPod Nano was introduced. Unlike the previous iPod Classic, Nano does not employ any hard disk, it uses flash memory instead. Its capacity of flash memory up to 16 GB. And on the second and third generation, Nanos support voice recording with third-party recording attachments. And since 3^rd generation, it has supported Windows Vista.

Those are the features I observe so far. In media a saw many news featured incidents involving iPod Nano. Similar to old cell phone that was heated during recharging process and even exploded, there are news featuring iPod Nano sparked up during recharging. In Hartsfield-Jackson Atlanta International Airport, an iPod set the pant of its owner on fire. There are still many incidents else. So, be careful with your iPod.

When A Lawmaker was Starting to Doubt About Their Money

This video is in Youtube. It seem that this hearing season was take place on November 2008. This cut is about a question from member of US House of Representative, Ron Paul (pictured), to Chairman of US Federal Reserve, Ben Bernanke. This following points are summaries of Ron Paul question:

• It has been much fund and energy spent to save fiat currency, and it seem that these efforts and thing being saved do not work.

• There is a possibility that they fail to notice that their financial system is failing, US$ is dying. The root of the problem was in 1971 after dismissal of Bretton Wood System. Perhaps the world has noticed this thing and begin talk about new international reserve currency, although they has not determined the form, replacing US$ as international currency.

• Ron Paul ask Ben Bernanke, whether in meeting of central bankers, in which USA included in them, has considered gold as new international currency.

Perhaps (in my opinion) central banks across the world had been anticipating the failure of US$, if not, why are they still keeping gold in their reserves, including The Fed. Yes, all of central banks do keep gold. So if there is failures of US$, they have something to depend upon.

Of course Bernanke, deny Ron Paul opinion. Logically, even if he agreed with Paul, he would not express it publicly. In my eyes, in this session, his body language betray his words. There are many interest to defend US$. Logically, it is also foolish for us if in long term, we save a fixed value of money in any fiat currencies, even if they has “strong” values (strong is not the word, I guess). For me it is better save than sorry.

Tips On Unplugging USB Flash Disk

Today, perhaps USB Flash Disk is the most popular data traveler. It had long replaced floppy disk as rewritable recording medium, today almost no PC have floppy drive. This USB Flash Disk has more advantages than floppy disk. It has larger capacity (there are up to 4 Giga Bytes, and increasing) and more resistant to damage because of its solid state. We also can use it to install operating system such as Windows XP, Windows 7, and even Linux to PCs and laptops.
.
It is recommended when we unplug Flash Disk from USB slot, click first Safely Remove Hardware. This is to make sure that there are not processes of writing, reading, or erasing files to Flash Disk. If these activities is interrupted by unplugging Flash Disk, there is a possibility of damage. In my experience, most damages occurred from failure to complete these process. Note that Safely Remove Hardware can not be executed when the process of writing, reading, or erasing files to Flash Disk still running. The hint that process still in run is indicated by blinking LED of Flash Disk. So don’t ever try to remove USB Flash Disk when the LED is still blinking. We can remove it directly anytime if we are sure that there are not any processes of writing, reading, or erasing files, but consider the risk.
.
Generally, USB Flash Disk will defect across time. Slowing process of writing, reading, or erasing files is the most visible indication. Please remind that its function is as data traveler, to transfer data. It is not recommended to keep data in data traveler in long time. 

Improving PC’s Performance Using TuneUp Utilities 2007

Old PC have many disadvantages. New softwares tend to demand faster processor speed and higher RAM, also need more free space on Hard Disk. Sometimes, when the minimum requirements demanded is fulfilled, PC is still slow, especially when we perform multitasking. (I experienced this during editing audio files)

Please look at TuneUp Utilities 2007, there is a tool to optimize computer configuration, other function please look it yourselves. By default, there are many functions in Windows OS that unnecessary. If we disable these functions, PC’s performance will improve and run faster.

After we got TuneUp Utilities installed, run the program and choose tab Optimize & Improve, and then click on TuneUp System Optimizer. A new window will appear, click on System Optimization. On Visual Effects drop down menu, choose on Maximum Performance while on Use the computer drop down menu choose whether your computer has internet connection, does not have internet connection, file server, or web server. After you have chosen, click on Next button.

TuneUp will scan your computer and automatically choose necessary tasks. Click on Visual Effects or System Configuration to see the necessary tasks. Click on Next button to finish these tasks, TuneUp will complete required task.

It is insufficient if we only rely on this TuneUp or other similar products. Learning to improve PC performance continuously always become better option. More importantly, we should perform regular maintenance on PC, even if it is newly released Personal Computer. Without maintenance, any computer will slow down in long term.

Which One is The Best Investment, Deposit, Gold, or Real Sector

Well, I don’t plan to write in this blog exclusively about audio software and mp3. This world is so wide and it is boring if we stuck ourselves in particular theme. Today I plan to rewrite an article by Muhaimin Iqbal, founder of Gerai Dinar, it was written in Indonesian, and here I try to translate it to English (If you understand Indonesian, check his blog). Be patient, this will be, more or less, like an economic lecture in High School.

He stated that the best investment is in real sector, with properly managed efforts. Real money is real object whose value is determined by that object itself, not by law imposed to object. Sadly, throughout the world today, money is fiat money. The money’s value is almost zero but law impose a value to money. If that law suddenly changes or becomes outdated, the amount of money we have will become worthless.

If we have money, it better to invest it in real object whose value will not decreasing across time such us property, gold, precious metals, or even livestock like cattle. If we deposit money in bank, sure there is interest with numerous rates, the money will decrease in value because of inflation.

Here Muhaimin Iqbal gave us a simulation. In 2001, money 38.5 million in Indonesian Rupiah is equal to 100 gold dinars. Please remember, 1 gold dinar is 4.25 gram gold 22 carats.

• If we deposit that money in bank, with interest rate averagely 6% per year, today in 2008 that money is about IDR 58 million. We have extra money about IDR 20.5 million.

• Suppose we change that IDR 38.5 million into dinar, in 2001 we would have 100 gold dinars (in 2001 gold dinar is equal to IDR 385,000), and we keep this. In 2008 1 gold dinar is equal to approximately IDR 1,3000,000.00, so that 100 gold dinars today is equal to IDR 130 million, just by keep it. Far more than any deposit in various bank. This is in Indonesia, in other countries, please re-simulate it again.

• Last month, Iqbal visited his friends who run a mahogany plantation in Gunung Ringgit Jember East Java. Here he simulated that if that IDR 38.5 million was invented to plant mahoganies, today in 2008 we will have IDR 1.35 billion. So it is right, if you have skill, better to invest in real thing than save it in bank account.

Today we face 2008 economic crisis, and governments across the globe is still doing nothing. It is likely we should make efforts by ourselves. May be we can say that that things about investment above is easy in words. Yes, that is absolutely right, everything is easy in words, just when will you begin to make efforts? Off course there are many reasons to disagree with those, and conversely, thousand reasons is available if we make it.

-

Trimming Audio Files Using Audacity 1.2.6

I feel that trimming audio files using Audacity is much more easy than any other audio editor. Everything are done using mouse. Just select the section of the file intended to be cut. Selection portion also can be zoomed in and out to make selection more accurately (look at the picture).

Exporting selection into files have three options, as WAV, MP3, or OGG. The only problem here is Audacity 1.2.6 in default do not has any MP3 file encoder. We must download lame_enc.dll separately, an freely available LAME library to handle MP3 file encoding. Just go to search engines and search it, or just go here. After we obtain the encoder, when we export selection to MP3 file, we are asked to locate lame_enc.dll, just once. After we accomplished this task, we have no problem in exporting to MP3 files.

Michael Moore's Statement about File Sharing and Piracy

I got this statement from the famous filmmaker who specialize himself in directing documentary films, Michael Moore. He is one of my favorite filmmakers. In this video, he stated his opinion about file sharing and piracy. It is unusual for opinion from a filmmaker, but I just say his stance is great.

Here he quote, “I don’t agree with copyrights laws and I don’t have a problem with people downloading the movie and sharing it with people, …” Then he said, as long as people do not try to make a profit from his labor, it is OK for people to share it. Just like when you lend a DVD you bought to a friend. He also said that it is his belief that information, arts, and ideas should be shared.

Well I found some of his movies in YouTube, Sicko, not just a trailer but the complete movie. I haven’t checked yet but it is said that The anti-Moore site MooreWatch posted a link to a BitTorrent file containing a version of the movie, Fahrenheit 9/11, taped at a cinema. May be there are files in Rapidshare too.

One thing I see is the more popular a movie, book, etc., the more it will be pirated. Well I see there are thousands of complete series manga scanned and distributed via web, just days after published. There are non public domain books too. Almost all of MP3s in web is product of piracy. May be publishers should try to make advantages from this problem, how to make piracy as free advertisement. Is it possible? Just try it first.

Beethoven’s Eroica: The Once Named Bonaparte

It is Symphony No. 3 in E flat major (Op. 55), best known as Eroica, an Italian word for ‘heroic.’ This musical work is noted as a mark of the end of classical era and beginning of Romanticism.

Beethoven arranged this symphony in four movements: Allegro con brio, Marcia funebre: Adagio assai, Scherzo: Allegro vivace, and Finale: Allegro molto. Complete performance is about 45 minutes. The symphony is scored for 2 flutes, 2 oboes, 2 clarinets in B flat, 2 bassoons, 3 horns in E flat and C, 2 trumpets in E flat and C, timpani and strings.

Originally, Beethoven dedicated this work to Napoleon Bonaparte, First Consul of French, and even name this symphony with The Consul’s name (Bonaparte). He is surely admire the ideals of French Revolution and The Consul. It is Napoleon Bonaparte The Consul whom he admired, so when Napoleon was proclaimed Emperor of The French, he become disgusted and even tore the name Bonaparte from his completed work with a knife violently. He then changed the title into Sinfonia eroica, composta per festeggiare il sovvenire d'un grand'uomo (“heroic symphony, composed to celebrate the memory of a great man”).

Eroica now is public domain, widely available. Wikipedia even has fully played complete movement in OGG format. There are many sites that has downloadable files of Eroica in many formats such as MP3, OGG, WMA, etc. One of the ways to find it faster, type “Beethoven’s eroica” in music tab in search engines such as Altavista, Yahoo, etc.

Audacity: Free (open source) Audio Editor and Recorder

I just found a freeware stuff, Audacity, capable on multi Operating System, to edit and record audio software. This software is very useful to edit recorded audio files. Audacity® is a freewre, open source software for recording and editing sounds. So we can freely redistribute it and hopefully any of you are able to improve it. It is available for Mac OS X, Microsoft Windows, GNU/Linux, and other operating systems. If you have other comparison, please contact me.

This Audacity is Free, Cross-Platform Sound Editor. Its latest release is 1.3.6 (Beta). It still a work in progress and have not yet come with complete documentation or translations into multiple languages. This Audacity is recommended for advanced users.

See New Features in 1.3 for more information about the 1.3.x Beta series. For all users, Audacity 1.2.6 is a stable release, complete and fully documented. You can have Audacity 1.2.6 and 1.3.6 installed on the same machine.

Please check and download this release here forAudacity 1.2.6 and Audacity 1.3.6 (Beta). Other download is found here

Editing Audio Files Using JetAudio

There are features of audio editing in JetAudio (espescially JetAudio 7.XX). they are not much complete like professional audio editor, but still these features make JetAudio unique, compared to other audio players. They are only audio cutting, ripping, converting, and recording, so far I explored.

Something I notice about these features are they need bigger RAM and faster processor speed. In CPU with Pentium III processor or equivalent, there is possibility that produced files are imperfect. During converting, ripping, or cutting using JetAudio, CPU is forced to work until 100%. If this work is still not sufficient, produced files will be defective.

Generally Windows XP operating system can breathe normally in PC with Pentium III processor and 256 MB RAM. For office program and other common application, there are no problems. Even for image processing, even if a little hard to breathe, it still able to run safely, just need longer time. But audio editing using JetAudio will make error on output files. These JetAudio features need at least Pentium IV processor with 512 MB RAM, or equivalent. Less than that, may be the outcomes are still OK, but there are not guarantees for other occasions.

Quran Recitation by Syaikh Abdul Rahman Al-Sudais an-Najdi

I just found mp3 files of complete recitation of Quran by Syaikh Abdul Rahman Al-Sudais, the leading imam in Masjidil Haram, Makkah Saudi Arabia. He is praised for his precise, controlled, and particularly emotional recitation of the Qur'an in accordance with Tajweed, the rules of beautiful recitation.

These are recoding of his beautiful recitation of Quran from Al-Fatiha to Al-Nas:

001 002 003 004 005 006 007 008 009 010 011 012 013 014 015 016 017 018 019 020

021 022 023 024 025 026 027 028 029 030 031 032 033 034 035 036 037 038 039 040

041 042 043 044 045 046 047 048 049 050 051 052 053 054 055 056 057 058 059 060

061 062 063 064 065 066 067 068 069 070 071 072 073 074 075 076 077 078 079 080

081 082 083 084 085 086 087 088 089 090 091 092 093 094 095 096 097 098 099 100

101 102 103 104 105 106 107 108 109 110 111 112 113 114

His complete recorded recitation is found in this site, the site owner surely does have big space. Of course his complete recitation is so big in size. They are in mp3 format, almost up to one CD in size. It is no problem if you have high speed internet connection, you can download them in considerably short time. But if you can not download it, CDs of complete recitation of Quran in MP3 format in widely available in Muslim countries or Islamic Centers. Because of there is not copyright, (it is recorded during praying, especially in Ramadan Taraweeh), this recording is available in very inexpensive CDs, free to recopy and redistribute.
.

MP3 Player

It is like just yesterday, here in my country, that MP3 player is so popular, yet it is vanishing. The first MP3 player I saw is like in this picture. Generally it has space of 128 MB. It has metal chasing so if it is connected to PC trough USB, there will be sensation of a little electric shock to anyone who dare to touch.

This is very complete in its generation. Able to play audio files, FM radio, record audio in WAV, and of course hold digital data like general data traveler. For simple use, this player is very useful. I usually use it as FM radio receiver, I mean I do not really like to hear music during busy time using earphone. Sometimes I record speech of a lecturer during seminar or studium generale. Too bad its batteries is unrechargeable, and only able to stand for several days. I see this type of player begin to vanish, after its price getting lower. There are new types almost every month.

Converting Cassettes to MP3

When I saw old cassettes, sure it bring many memories. The old songs and old tapes I hardly ever see again. Now everything are digital and digitally created. I can not remember when did I see a person carrying walkman or playing cassettes on tape player.

It is said that recoding in tape is analog and in computer is digital. I hardly understand the meaning, but sure I had successfully transferred recording in tapes into mp3 files. It is easy and unworthy to be bragged about.

This is the process to transfer or convert or rerecord audio in cassettes or tapes into digital files such us MP3, WMA, WAV, etc.:

First, we have to find a tape or cassette player, any type, which has earphone output. I hope you do not have difficulties finding it in this era. Make sure it can play well.
Second, we need an audio cable (most of audio cables are stereo, so are the slots in player and soundcard of PC) to connect earphone output in player and line-in input in PC soundcard. Make sure the slot and cable’s connector fit perfectly, there are many types of cable’s connectors and slots.

Third, with PC on, try play the player, don’t forget to adjust volume of line-in. If everything is OK, there will be any sound from cassettes in PC speaker. Adjust volume of line-in to the best position.

Forth, we must have audio recording application installed in PC. Try use JetAudio or other programs to record this. Don’t forget to select line-in as source of recording and set other parameters in recording such as bit rate, file output types, etc. If we play cassettes continuously, we will need audio trimmer programs to cut each song individually. There are plenty freewares to trim audios in internet we can download, such us in download.com and tucows.com.

What is MP3?

Do you ever try to compress MP3 using zip/rar when the data traveler can not hold them all? Please do not.

MP3 is compression format, designed to greatly reduce amount of data required by audio, yet still have quality like faithful production to the most of human ear. This MP3 was invented by European engineers who work on EUREKA 147 DAB digital radio research program. This format was standardized by ISO/IEC in 1991.

Today this is the most popular audio format of the world. The recording process will discard portions of data audio considered not important to human ear. So, generally, producing audios with quality almost like faithful production, but the size is greatly reduced. So we should not be foolish by compressing MP3 when we feel that data travelers can not carry them. This MP3 is a compressed one.

MP3 is enjoying popularity not only from end users and software, but also portable media player like mp3 player, dvd or cd player, etc. I barely remember when did I ever saw people bring walkman. Now there are only mp3 player which is also fading replaced by ipod.

Free CD to MP3 Converter 2.5

I just found a freeware program to convert CD Audio to MP3, WAV, WMA, etc (this is a cd ripper) This program supports ID3 tag editing and is able to save filenames based on track, also supporting normalization of audio files. There is also microphone input to record MP3, an later converting it to other formats like WAV, OGG, WMA, etc. This cd ripper worn on Windows 95/98/Me/NT/2000/XP/2003 Server/Vista. You can download it here at download.com.

Something we must now is that converting audio CDs for our own is not considered piracy. Unless we remake and distribute them of course. So feel free if you want to convert your CDs.

Speeding up PC Windows

If you have old PC or wishing for better performance, these tricks on registry will make our PC faster.

Accelerating shutdown process
Start > Run > type regedit > ENTER
Go to entry “HKEY_USERS \ .DEFAULT \ Control Panel \ Desktop”.
See entry “AutoEndTasks” (if there is not, right click on mouse and choose “New | DWORD Value”, give name “AutoEndTasks”), double click on it and type value “1” on “Value data”. Click OK.

Accelerating Start Menu
Start > Run > type regedit > ENTER
“HKEY_CURRENT_USER \ Control Panel \ Desktop”.
Choose entry “MenuShowDelay” and type value “0” on Value data. Click OK.

Stopping automatic defragmentation
Go to “HKEY_LOCAL_MACHINE\SOFTWARE\Microsoft\Windows\CurrentVersion\Explorer\MyComputer\cleanuppath”
Please delete entry default.

Ending program faster before shutdown
Go to “HKEY_LOCAL_MACHINE\SYSTEM\ControlSet001\Control”.
On entry “WaitToKillServiceTimeOut”, plase lower the value to 100 (in milisecond)
Go to entry “HKEY_CURRENT_USER\Control Panel\Desktop”. Make sure entry “AutoEndTask” have value “1”.

Clearing DLL from RAM
Go to “HKEY_LOCAL_MACHINE\SOFTWARE\Microsoft\Windows\CurrentVersion\Explorer”
Choose New > Dword Value. Type name “AlwaysUnloadDll” on that entry. Double click and type value “1” on “Value Data”.
If these steps is done, please go to start-up editor by typing “msconfig” on Run. Uncheck all of unnecessary start-up on Startup TAB. We do not need some of these startup if we do not run some specific applications.

Bugs in Winamp 5.XX

I recall that Winamp 5.XX has some bugs, may be they are not bugs, but I consider them bugs because they are not present in previous Winamp and causing discomfort.

First, after Winamp 5.03, Winamp can not play audio files in wav formats. So I have no other choice other than converting may wave files to mp3 or other formats. Converting audios using my old PC surely consume much times.

Second, when we double click file in playlist editor to play files, there often pop-up a window to open file. Previously this just result in playing file. Of course we must close it repeatedly.

In my old PC (Pentium III, RAM 256) this Winamp need more memory of RAM than Window Media Player and skin of Winamp Modern slow its performance. But I still use it anyway.

JetAudio 5

This JetAudio, I say, is one of my favorite audio software. I don’t say that this is the best audio player, but surely there are many features that only I found here. Like many other players, it is able to play almost all off audio and video formats. The exception is JetAudio offers more features other than just playing audios or videos.

Feature I explore most is recording. It’s so convenient to record speeches in many formats and bit rate. In main window, the features other than playing files are CD Ripping, Conversion, Recording, Burn, and Broadcasting.

I admit that playing with this JetAudio is less convenient than Winamp. But the point is this application has features that Winamp doesn’t.