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To: varmintman
That would create a new stone age in North America. We'd be rubbing sticks together to make fire.

Why?

8 posted on 02/29/2012 7:08:52 AM PST by BfloGuy (The final outcome of the credit expansion is general impoverishment.)
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To: BfloGuy

Mainly because the supply of gold in the universe is limited and cannot expand to meet the needs of expanding economies but, in particular, the combination of a gold standard and fractional reserve banking was toxic all during the 1700s and 1800s after the initial infusion of new world gold into Europe petered out. There were cycles of expansion of fractionally gold-backed dollars and then collapse as bankers called everything back with higher rates and what came back was homes, farms, and capital assets; there wasn’t any new gold being produced to come back to pay interest on loans based on any sort of a 10% reserve.


13 posted on 02/29/2012 7:39:58 AM PST by varmintman
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