Posted on 03/18/2020 9:01:22 AM PDT by A_perfect_lady
I know very little of these things. I'm an English teacher, and a mathematical cripple. But it seems to me our economy could shrink to a point where tying our money back to gold might be possible. I'm asking Freepers because most of you know more about this than I do. So... what do folks here think?
But the Gold is gone!
Prudent central bankers are probably more useful. (Good luck).
We do have our awesome American Silver Eagles, but I feel we need more variety.
I am probably a stronger advocate of sound money than anyone here besides Travis, but that is a guaranteed way to lock things up in a liquidity crisis.
You cannot continue deficit spending when on a gold standard.
Politicians from both parties love deficit spending.
Therefore instituting a gold standard will never happen.
There is not enough gold to go back on the gold standard. You might be able to go back on it fractionally.
You have to understand how money is created now under our present completely fiat, Federal Reserve system.
Once you see how money and debt are so easily created, you can see how it greatly corrupts government and society. After all, money and the cost of money is the most important commodity of all. The signals it sends dictates nearly every decision you make.
I, for one, am a very strong supporter of a precious metals standard.
When I have discussed this, I’ve ben told “ok take your salary, assets, etc. and chop off a zero on the right (divide by 10! ** )”. As long as I buying power did not change it wouldn’t matter much to me. I am sure there would be a psychological effect on many.
** Now I don’t know who “they” arrived at the ‘divide by 10’ number. I do agree there would be a huge contraction in the money supply. ( I guess its possible it could be more then 10!)
I advocate sound money. The problem is that the Fed often tries to serve two masters: maintain the value of the currency and stimulate growth. I would prefer that they just stick stable currency, and let the fiscal side handle the growth. That is, low taxation, low borrowing, low debt. BUT, politicians being politicians, they are hard wired not to do these things. Hence the problem.
Possibly that “drag” from a hard asset standard is necessary!
Agree about the prudent central bankers, the real problem are politicians playing with the money supply. Cheap money (Credit available at low interest rates ) brings in the votes. I remember reading an article by Friedman where he suggested computers set the money supply, make it independent of politicians & the judgment of people.
I would listen to anything Milton Friedman had to say. There could be a “virtual gold standard” where the computer would monitor the prices on a basket of commodities and adjust the interest rates accordingly. Takes the politics out of it, though, I am sure there would be pitfalls.
You can’t eat it. You can’t drink it. It won’t keep you warm, or cool, or shelter you from the elements. So in times of great distress it is not all that useful.
I Think its possible we might find that out
QE is impossible with a backed currency. Seeing how addicted the government is to QE, I don’t see how this could happen.
Well to back every dollar with gold the estimates are the price of gold would have to be 20,000....
You can’t eat it. You can’t drink it. It won’t keep you warm, or cool, or shelter you from the elements. So in times of great distress it is not all that useful.
But you can eat and drink paper money?
Thanks. I didn’t know.
Typical nonsense. It's only difficult for bureaucrats to expand the supply. New gold is continually mined. If there's "not enough," it becomes more valuable and miners work harder to produce more. The whole thing is self regulating.
We CAN'T have that!
ML/NJ
I’m ignorant as can be here but it seems to me if you own some gold currency you might want to have a look at it because the government is telling you right there what it’s really worth.
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