Posted on 11/02/2022 9:29:54 AM PDT by SeekAndFind
“Price per oz needs to go up 50-100x. Done.”
No, the purchasing power of the dollar needs to go up 100x because it is backed by Gold.
How much do you propose raising interest rates?
Since “raising interest rates” is conducted by a central bank (or most cases, government authority) YES, that is central planning.
Teturnin
IMO, returning to “the Gold Standard” would force this country that it doesn’t have gold on hand, OR that the ‘gold’ it does have is fake or concocted fantasy.
The horse/gold analogy.
In Roman times a good horse was equal exchange for one ounce of Gold.
In the 1800’s a good horse was equal exchange for one ounce of Gold.
Right now a good horse is equal exchange for one ounce of Gold.
The dollar “amounts” throughout time are irrelevant.
Since the largest gold producers are in China and Russia, both of which are planned economies, why do you want to give their governments control over the US economy? I don’t think you’ve thought this through.
you’re missing the point....
The Chinese and Russian governments, which control world gold production, thank you! If you’re going to peg the US currency to an arbitrary commodity, why not pick one we have to produce a lot of? Peg the dollar to corn for example!
Only if the price of gold is somewhere in the $100k an ounce range. Which would be OK by me.
Dramatically reducing the number of dollars and sharply increasing their value would significantly reduce the use of dollars in commerce. Without anything to replace the dollars, the total amount of commerce would drop. That’s called a depression. Not a good idea!
I’d like to see an audit of the Fed and and audit of our gold supply.
I see this whole article is an vehicle to tell us all how the Treasury and the Fed have been destroying our existence with their funny money manipulation.
This is a terrible idea. And the FED building 2% inflation per year into the system is also a terrible idea.
“Dramatically reducing the number of dollars and sharply increasing their value would significantly reduce the use of dollars in commerce.”
No, it would significantly reduce the “number of dollars needed” to conduct the same amount of commerce.
In 1966 my Dad bought a brand new high end Chevy Super Sport for $3,600. Same amount of materials were needed to be produced, same amount of labor was required to produce it as now.
Same commerce volume as now, just a different “dollar amount” exchanged because the purchasing power of the dollar was still backed by the Gold standard.
“Purchasing power” is the important thing, not how many dollars, but what each dollar can purchase.
I had some fool tell there wasn’t enough physical gold in the whole world to back up authorized US currency.
I asked if it sold for $100,000/oz would there be enough physical gold?
One could almost see the light in his eyes.
That's not really born out. A sharp contraction in supply / rise in value of a currency leads to hording, not use.
In 1966 my Dad bought a brand new high end Chevy Super Sport for $3,600. Same amount of materials were needed to be produced, same amount of labor was required to produce it as now.
You gotta be kidding me. Labor productivity has jumped *dramatically* since 1966 - in part due to major technological and supply chain improvements like the use of robots in manufacturing. And adjusted for inflation, the US economy is far larger than it was then - approximate 5 times bigger!
“And adjusted for inflation, the US economy is far larger than it was then - approximate 5 times bigger! “
Because the dollar is worthless.
Did you miss where I said “adjusted for inflation?” If the dollar is worthless please give me all your dollars.
Nine percent inflation? strike that, it is more than 15%.
There’s indeed not enough gold to make this work. At the current price of Gold.
Reinstituting a “gold standard” is just an artificial constraint on the money supply similar to such devices as the “debt ceiling” or “social security trust fund”. It was largely abandoned because it forced global governments to balance their trading accounts by shipping gold bullion around the world which was risky. The modern approach was to have floating exchange rates between sovereign nations so they can convert their fiat currencies to other currencies to pay their foreign obligations.
Since the Fed would set the value of gold and fractional reserve requirements to match the amount of dollars needed by the Treasury to pay its bills, it just adds another level of complexity just to appear more virtuous.
Currency issuers like the Federal government can create whatever funds they need to pay their obligations provided they don’t exceed the productive capacity of the real economy and drive up inflation. They call this Modern Monetary Theory but it’s not a theory, it’s actually how it is done.
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