Can The Dollar Once Again Be Anchored By Gold? One Congressman Believes It Can

The Mises Institute ^ | 11/02/2022 | Thorstein Polleit

[FreshPrince]

“In a truly free market, people will choose the good they want to use as money.”

aka bartering

[Alter Kaker]

There’s not enough gold to make this work. The total value of all the gold in the world is about $11 trillion, or less than half the annual gross domestic product in just the United States.

[MeganC]

Eh, the Fed seizing or trying to seize all of our gold and silver so they can use it to back their funny money won’t be far behind.

[algore]

We don’t have the gold, so we cannot make the rules.

[Openurmind]

Absolutely!

[DannyTN]

Really stupid idea. When the dollar was backed by gold...

• We had severe deflationary depressions every 20 years.
• We had severe year to year fluctuation in the value of the dollar, sometimes even 20% swings in year to year inflation/deflation.
• Congress devalued the dollar whenever there was a major crisis.
• Congress was still able to borrow and they have no hesitation about promising that your children will repay their debts with gold.

Other things to consider...

• China is the major producer of gold. Linking the dollar to gold gives China control over our monetary policy.
• Speculators like George Soros can manipulate commodities like gold much easier than they can the dollar.

[lula]

When was the last time anyone actually laid eyes on the gold in the Treasury?

[PGR88]

There’s not enough gold to make this work.

If so, what's "enough?"

Or just maybe - there's too many printed dollars?

[PGR88]

EVERYTHING you said has occurred since the US went off the gold standard, but even worse.

[Alter Kaker]

Or just maybe - there's too many printed dollars?

Could be, but dramatically reducing the money supply would destroy the economy. Why would you want to do that?

[PGR88]

but dramatically reducing the money supply would destroy the economy.

So just keep printing, and inflating?

We are suffering through 9% inflation now. How much higher do you want it to "save" the economy?

Tell me, Mr. Central Planner, what the ideal amount of "money" is?

[Openurmind]

“Or just maybe - there’s too many printed dollars? “

Exactly right...

[Alter Kaker]

When was the last time anyone actually laid eyes on the gold in the Treasury?

What difference does it make? The US only owns $400 billion worth of gold, which is less than 2% of the US economy.

[Alter Kaker]

So just keep printing, and inflating?

I didn't say that. Inflation is bad, and we can solve it by reducing government spending and raising interest rates. What you're proposing, however, is crazy. You want to effectively get rid of money altogether. Bad idea!

Tell me, Mr. Central Planner, what the ideal amount of "money" is?

I'm not a central planner. Sorry to disappoint!

[discostu]

No. The simple fact is most money isn’t physical anymore. It’s 1s and 0s flying around the world. We really don’t know how much of it is out there, we can’t control it, and therefore you can’t back it with anything.

[Owen]

The problem with gold backing is what it has always been. It provides CEOs of gold mining firms control of the global economy. Nobody elected them.

Nobody elected Fed Governors, either, but their whimsy is rather more diluted than a handful of CEOs.

Besides which, gold’s value is entirely imaginary.

Might want to try something with actual value as the basis, like oil. When oil production falls, then the money supply will too, and the economy — but when oil production falls that was going to happen anyway.

[WKUHilltopper]

Eliminate the federal reserve.

[Openurmind]

“but dramatically reducing the money supply would destroy the economy.”

You are confusing “number” of dollars with “value” of the dollar. Two totally different concepts. Because of the stability of the purchasing power of gold One dollar used to purchase what 97 dollars does now.

[libertarian66]

Price per oz needs to go up 50-100x. Done.