Should We Return To The Silver Standard? I Have An Idea!

I think the us could return to a metal standard. Unlike Mexico, US currency is much more popular world wide, and is a reserve currency. Precious metals on the other hand would become pegged in the US. US currency would become the precious metal of the rest of the world. The problem is that the US would lose the ability to control the "value" of it's currency. Save we had $5 silver 1/10 once coin. Silver instantly becomes $50 an ounce, because that's what we say it is. Now if silver is currently $28 on the world market when we do this, the world will sell us silver hand over foot, until it equalizes.

Gold was pegged at $35 a once for decades by us. Only when we went of the standard was it allowed to float.

Now, there is some bad that comes with this. If the rest of the world stays on a fiat system, our money will become more and more expensive as we would lose the ability to inflate our currency easily or debase it easily. It could be done, but we'd need to add precious metal to inflate it, and change coinage each time we'd want to debase it. We did it before(Think Seated Liberty coins with arrows).

The biggest problem we'd face is our currency becoming too expensive for the rest of the world. example, the euro is roughly worth $1.25. We decide to go on a silver standard pegged at $50 an ounce when silver is at $28(current situation) The US dollar would nearly double in value overnight. Europeans would have to pay twice as much for US exports than they do now. The Euro would be like .60 to the new US dollar. Our exports would suffer and would get worse as other fiat systems inflated. We'd be able to import things cheaply, but that would worsen the issue we have now actually producing products here. We wouldn't be able to sell to the world and it'd be way cheaper to import instead of producing here. Jobs would disappear.

We'd need other countries to come on the standard with us to have trading partners.

I knew he would know.

Correct nod