Originally posted by: hackshot. Since Cocy open the door, let me pose a question:
How would the Republicans (or RP for that matter) be able to magically turn the US back onto the gold standard?
I ask this because in my limited purview of economics, doing so would cause a massive squeeze on the amount of money the US has. In my mind, doing so at the current timeframe would drive global markets into a deep prolonged recession, even a depression until the US could finally put the amount of dollars in gold.
I would feel that it would take a massive undertaking that would have to be carried on behind closed doors for years, because any leaking of leaders prepping to return to the gold standard could cause a panic.
By all means enlighten me.
I was just reading this article today. I don't know the mechanics nor am I smart enough to know how it would work.
A return to a fixed money supply would also remove the central bank’s ability to offset demand shocks by varying interest rates. That could mean a more volatile economy and higher average unemployment over time.
This last paragraph is a snippet into one of my worries. The gold standard is a nice picture to paint for Tea party voters who have limited views of economics and those who live in the past.
As the global supply of gold dwindles (remember Gold is formed from supernovae in percentages of <0.1%) I wouldn't be surprised to see gold continue to fluctuate in large jumps and dips for sometime to come. This then in turn causes frequent economic slowdowns, but again the stock market isn't just one item there would be a lot of other issues at play as well.
A return to a fixed money supply would also remove the central bank’s ability to offset demand shocks by varying interest rates. That could mean a more volatile economy and higher average unemployment over time.
This last paragraph is a snippet into one of my worries. The gold standard is a nice picture to paint for Tea party voters who have limited views of economics and those who live in the past.
As the global supply of gold dwindles (remember Gold is formed from supernovae in percentages of <0.1%) I wouldn't be surprised to see gold continue to fluctuate in large jumps and dips for sometime to come. This then in turn causes frequent economic slowdowns, but again the stock market isn't just one item there would be a lot of other issues at play as well.
I like that you are asking good questions. That is the first step to hopefully finding some good answers.
Ron Paul has written books about this topic.......so if you want more complete details (not butchered, try this this.....it can also be found for free download on the net too).
The easiest method is to allow for competing currencies to simply exist (ie. competition). Currently the FED, not the Federal government, but a cartel of private bankers, set all the monetary policy decisions in this country.
A lot of people think they know what the FED is but are shocked to find out how they were created and who they actually serve.
The FED will not allow competing currencies to be formed and anyone who has tried has been outright arrested, shut down, or influenced, by heavy handed regulatory leveraging, right out of business.
Insert google search terms:
ron paul gold dollar
bit coin
etc.....just to name a few.
Competition is never a bad thing, ever, and letting people choose which currency to use is clearly the easiest and best idea.
If the Fed is right and causes stability, in unstable times, people will continue to use their US Dollars.
If the Fed are nothing but monetizing, fractional reserve, fiscal fiat, money bubble blowers......hell bent on using inflation as a hidden tax to perpetually fuck the American workers, who are trying (but failing) to retire (ever), then that will also be decided on by free volition.
Most of us know that a monopoly is a bad thing......but yet we accept it and fear not having a monopoly when other viable choices are clearly out there.
We fear having the ability to try new things in parallel with things that we are already doing. We fear choices, we fear new implementations. We act like we only have two choices and that there can never be anything inbetween.
The gold standard doesn't always imply a currency 100% backed by gold either. It can be a based on a percentage of gold far less than that too. Which rectifies the issue of there not being enough gold.
The entire purpose and premise of the gold standard is to create something tangible, real, that is harder to fabricate out of thin air.......or by ramming the zero key on a FEDERAL RESERVE keyboard.
The money we have today are based on nothing but promises......promises that are becoming harder to keep and are quickly escalating into the realm of insolvency.
This is what I say to the argument of Gold fluctuates too much.......as opposed to the dollar is being eroded too rapidly. It's all relative to what you are trying to measure it to.
Bench gold vs. gas and the fluctuation is nothing compared to gold vs. dollars........gas vs. dollars.
So I hate to say that this fear is largely unfounded......but I can't help but feel that way.
The reason the case has been made that the gold standard will allow for higher unemployment is a purely Keynesian argument.
If people hold onto their own wealth, by having money that can't be replicated out of thin air, then it can't be stolen away from them by simply printing more of that fiat money (or loosening liquidity as they like to word it).
The Fed loves having the ability to macro manage and control the economy, by opening up the flood gates of cash, with low interest rates, with minimal holding requirements, so that it can blow massive bubbles into specific sectors. After this bubble pops, which it always does, they can justify printing even more money to justify not wanting to see "dangerous" deflation.
As Friedrich Hayek once said, and won a Nobel Prize for, the fluctuation in prices we see today is from these booms and busts and not from the hard commodities that fake money is now being fixed to.
The Fed does this because it is profitable (for them to get paid to print and distribute more useless money) and it is also way of spraying a garden hose of other peoples money at centrally planned conduits that only "they" approve of.
This is why the rich keep getting richer, because it directly steals money away from the hard working and poor so that they can never save enough money and retire.
For the non-wealthy, the rate of inflation has exceeded our individual rates of savings.
When people hold their own money it can only be taxed away from them. It can't just be stolen out from under them, involuntarily, through massive monetization efforts.
Since the government and banks don't like that idea.......they also don't like real money. Post edited by Mockery at 8/24/2012 12:24:28 AM
Originally posted by: Mockery The easiest method is to allow for competing currencies to simply exist (ie. competition).
^this.
Originally posted by: hackshot. I ask this because in my limited purview of economics, doing so would cause a massive squeeze on the amount of money the US has. In my mind, doing so at the current timeframe would drive global markets into a deep prolonged recession, even a depression until the US could finally put the amount of dollars in gold.
prior to 1873, the US was on whats called, Bimetallism
In economics, bimetallism is a monetary standard in which the value of the monetary unit is defined as equivalent both[1] to a certain quantity of gold and to a certain quantity of silver; such a system establishes a fixed rate of exchange between the two metals. Some authors, such as Angela Redish[2] or Charles Kindleberger[3] have argued that bimetallism was, by construction, unstable. Changes in gold-silver exchange were, in their eyes, leading to massive changes in the money supply. Bimetallism was thus inherently flawed and the advent of the gold standard was inevitable. This view has been challenged by Friedman[4] and Flandreau[5] who wrote that the option to pay in gold or in silver had in fact a stabilizing effect.
and in 1874, the 4th Coinage Act of 1873 or, The Crime of '73 was passed and almost caused our nation to go into another civil war.
the very wealthy and powerful (its rumored European banking cartel) didnt like us lowly peons having any wealth so they got the bill to pass to only allow us to use gold as the standard. this didnt happen until 1900 and in 13 more years, the European Bankers took over.
Originally posted by: ~~Snake~~ Sam!!!! So is this judge crazy or what he is saying is Plausible?
no, why? because as i have already said, Obama will not be reelected. the pension tsunami is going to hit on the next presidency and the banks cannot have a peoples president that will be willing to bail out the people. they need slaves and they want to control everything so they will use Romney as the Austerity Measure President, sell off all American public services to private money (something i dont mind but, what i do mind is)- but because we will be so heavily in debt, instead of removing the taxes that we pay that go to said public services, they will continue to tax us for said services that are no longer provided so we the people can pay down the odious debt to Romney and Obama's banking friends.
I'm going to go against the grain here and say this:
Currency = liquidity.
Without a unified currency, you remove liquidity from the markets -very anti-capitalist imo. So once you start introducing different forms of currency, not only do you remove liquidity, but you also introduce what is known as a "coincidence of wants" that actually hinders trade and regresses back to a barter system that slows trade down tremendously.
Originally posted by: [-NM-] -SS- I'm going to go against the grain here and say this:
Currency = liquidity.
Without a unified currency, you remove liquidity from the markets -very anti-capitalist imo. So once you start introducing different forms of currency, not only do you remove liquidity, but you also introduce what is known as a "coincidence of wants" that actually hinders trade and regresses back to a barter system that slows trade down tremendously.
Well, yes and no. It was still fairly liquid when people started trading gold reciepts in place of the actual gold. I don't think you will find anyone has a problem with that. Keep a paper "currency", but it should all be backed by gold. Every red cent. This making money out of thin air can't keep working.
Originally posted by: [-NM-] -SS- I'm going to go against the grain here and say this:
Currency = liquidity.
Without a unified currency, you remove liquidity from the markets -very anti-capitalist imo. So once you start introducing different forms of currency, not only do you remove liquidity, but you also introduce what is known as a "coincidence of wants" that actually hinders trade and regresses back to a barter system that slows trade down tremendously.
Well, yes and no. It was still fairly liquid when people started trading gold reciepts in place of the actual gold. I don't think you will find anyone has a problem with that. Keep a paper "currency", but it should all be backed by gold. Every red cent. This making money out of thin air can't keep working.
It's the government man, they can say tomorrow that one ounce of gold is worth whatever the fuck they think it's worth.
Some fake company could say they found 1 billion metric tons of gold. What do you think will happen to the currency backed by gold? In other words, he who holds the most gold pretty much decides the value of the currency backed by said gold.
Originally posted by: Cocytus I'm not sure it's a perfect solution.
no, its not and, i am not all that hip with it either.
it all goes back to understanding how man places and/or has value in anything. just because someone says gold is awesome, does not make it so for everyone.
personal value items can vary from person to person. i have painting from my daughter that is freaking awesome. i highly value this painting but to you or anyone else, its just a painting.
gold, while it has numerous uses for man, is only as valuable as it is because other people believe it to be; because its hard to mine for or because its so rare. i do agree that it is a interesting metal in that it basically indestructible.
Originally posted by: Cocytus I'm not sure it's a perfect solution.
no, its not and, i am not all that hip with it either.
it all goes back to understanding how man places and/or has value in anything. just because someone says gold is awesome, does not make it so for everyone.
personal value items can vary from person to person. i have painting from my daughter that is freaking awesome. i highly value this painting but to you or anyone else, its just a painting.
gold, while it has numerous uses for man, is only as valuable as it is because other people believe it to be; because its hard to mine for or because its so rare. i do agree that it is a interesting metal in that it basically indestructible.
Bingo. Clean drinking water will go up in value in the near future. Or ammo if Obama gets elected again Post edited by ~~Snake~~ at 8/24/2012 3:12:37 PM
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"If guns kill people then spoons make us fat!"
the wierdo i before e, except after...wtf? TeamWarfare Vet
Originally posted by: [-NM-] -SS- I'm going to go against the grain here and say this:
Currency = liquidity.
Without a unified currency, you remove liquidity from the markets -very anti-capitalist imo. So once you start introducing different forms of currency, not only do you remove liquidity, but you also introduce what is known as a "coincidence of wants" that actually hinders trade and regresses back to a barter system that slows trade down tremendously.
Well, yes and no. It was still fairly liquid when people started trading gold reciepts in place of the actual gold. I don't think you will find anyone has a problem with that. Keep a paper "currency", but it should all be backed by gold. Every red cent. This making money out of thin air can't keep working.
It's the government man, they can say tomorrow that one ounce of gold is worth whatever the fuck they think it's worth.
Some fake company could say they found 1 billion metric tons of gold. What do you think will happen to the currency backed by gold? In other words, he who holds the most gold pretty much decides the value of the currency backed by said gold.
I'm not sure it's a perfect solution.
Gold nuttery is weird. That includes this forum. There's this cultish devotion, like gold is just something that magically has value, and appears in just the right quantities over time based on exactly how much is needed. It's like they think it's fairy dust. Do you guys understand how gold is and was mined in places like Peru, the combinations of mercury poisoning and silicosis? Or that wild inflation and deflation are not only perfectly possible with gold but have happened repeatedly?
We could re-elevate gold to its mythological status, and give governments another resource to fight over. It's not like there's a long history of warfare and slavery because governments wanted gold. Wait, that's exactly what happened in the New World.
So let's poison a few million more poor people, strip-mine some jungles, and remove a few mountaintops.
I didn't expect the Netherlands to be in the top 10.
Thanks. Let me rephrase that. I meant what countries have the most gold that could be mined? _______________________________________________________________
"If guns kill people then spoons make us fat!"
I didn't expect the Netherlands to be in the top 10.
Thanks. Let me rephrase that. I meant what countries have the most gold that could be mined?
Snake, what's your opinion on South Africa?
How so. It's got extremely high crime, racial tension and it's falling apart in farming since the govt took lands away from owners based on their skin color. _______________________________________________________________
"If guns kill people then spoons make us fat!"
the wierdo i before e, except after...wtf? TeamWarfare Vet
SS is right. South Africa has the most gold resources in the world. The United States, Russia, and China all have a lot of mines. Peru and all of its neighbors.
Here's a sad and entertaining article about gold-mining in Peru, with the US and French trying to outdo each other in corruption:
Originally posted by: the wierdo Sorry I misinterpreted your initial question.
SS is right. South Africa has the most gold resources in the world. The United States, Russia, and China all have a lot of mines. Peru and all of its neighbors.
Here's a sad and entertaining article about gold-mining in Peru, with the US and French trying to outdo each other in corruption:
I figured that was SS's point but didnt want to assume. T/hank you _______________________________________________________________
"If guns kill people then spoons make us fat!"
