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 Replies: 18 / Views: 2,375 |
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Moderator
 Australia
16849 Posts |
For gold to be a stable monetary basis, supply and demand have to be in balance. But since about 1940, the amount of refined gold is only increasing linearly, while the population is growing exponentially. There just isn't enough gold to go around anymore.
To remonetize gold to the same extent it was pre-1940, the world needs to either find vast new deposits of gold, and keep on finding vast new deposits of gold, or do something about getting rid of the "surplus population".
Don't say "infinitely" when you mean "very"; otherwise, you'll have no word left when you want to talk about something really infinite. - C. S. Lewis
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Rest in Peace
United States
9104 Posts |
Quote:
wouldn't the treasury need to have on hand enough bullion to back up all the paper money we have issued? Sure. I have an ounce of gold. I issue $1 million in currency. Each note is worth one-millionth of an ounce of gold. |
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Pillar of the Community
Canada
3692 Posts |
I think that what could be done is, issue a semi-weekly price (Monday and Thursday) for gold with upwards or downwards trends indicators. Then allow new mint-issued fractionals (without denominations) to be legal tender in the amount publically noted every half a week. What's messing with our minds is the fact that most bullion coins have denominations on them. Allow its use in commerce but not as a forced measure with an engraved value on it. Still, I have no idea how to stop international merchants from just flying in and scooping up all that gold. The change must be done in tandem with paper money.
What messed up the system the USA had before was that paper notes were redeemable in lawful money for an extended period of time. When that window closed it made no sense anymore to back up the dollar with gold. It still doesn't because the world is too globalized.
Edited by Libertad
08/10/2011 10:12 am
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Pillar of the Community
United States
667 Posts |
I'm not much of a currency guy in fact it is so complicated that I newer took the time to understand it all. From what I understand our dollar is based on future earnings or something like that.
Now do we want a gold standard - I don't know.
They would probably have to devalue gold drastically and then come up with a set price like was done in the past. Then it would take the speculation / investing part out of the picture.
I believe the last time gold was use as a true gold standard the price was set and it was no longer subject to the commodity pricing we see now.
I just don't see gold working. However country's could be required to hold gold as a percentage of their currency that is in the market and it could be used between them to pay off debt between countries. Sorry you would not be able to cash in your dollars for gold.
I may not be close on my thinking but it is weird enough for some politician to think up. Then their goes your gold hoard.
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Rest in Peace
United States
9104 Posts |
Krands are legal tender for the London fix. Face value changes constantly.
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Valued Member
 United States
362 Posts |
Couldn't the government do what they did in 1933 and then in 1934 under the Gold Reserve Act? But, I guess with all our debt the government couldn't afford to "buy" up all the hoarded gold bullion even if it wanted to seeing as that would just dump MORE paper money into the market and cause all sorts of issues. But, I guess the picture to take is global given who integrated the whole world economy is at this time everyone would have to follow suit in some fashion.
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Rest in Peace
United States
4849 Posts |
Quote:
However country's could be required to hold gold as a percentage of their currency that is in the market and it could be used between them to pay off debt between countries. Sorry you would not be able to cash in your dollars for gold. that's the only way it could ever even potentially work in these days imho. The value of gold would go up drastically and it would have to be a partial backing of the dollar(maybe 10%) in order allow enough currency for a nation to work with these days. |
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Pillar of the Community
United States
667 Posts |
Now the only bad thing is that they would have to get the gold. You want to bet they would get it the old fashion way. Remember the Fed already proved gold ownership is a privilege and not a right in the US.
I doubt they would have to give that much in return for you agreeing to turn in your gold either.
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Pillar of the Community
United States
1285 Posts |
Instead of concerning one's self with things that one cannot control, read again what Sap posted about Supply and demand. Quote:
the amount of refined gold is only increasing linearly, while the population is growing exponentially. There just isn't enough gold to go around anymore One outcome of this current crisis is that the USD and Gold can and will move UP in long term (greater than 1 year). These short term blips caused by electronic trading are just clouding the supply demand dynamics. |
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New Member
United States
48 Posts |
I read recently that the entire value of all the gold ever mined was something like 9 trillion dollars at today's prices. In order to take us back to the gold standard, gold would need to be priced at over $60,000/oz to cover the amount of printed money and checks in circulation.
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Valued Member
United States
407 Posts |
It's easy, but you have to look at the other factor in the equation. Bread would have to be $100 a loaf. And I'm really not ready for a world in which bread is a a hundred bucks a loaf, milk is two hundred dollars a gallon, and a trip to Starbucks for a small latte' makes your pocket three hundred dollars lighter.
Steve
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Pillar of the Community
United States
830 Posts |
I agree Ceylon and Sap, and money supply is very important. You don't want too little any more than too much, it all about controlling the quantity.
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Pillar of the Community
United States
4008 Posts |
Quote:
And I'm really not ready for a world in which bread is a a hundred bucks a loaf, milk is two hundred dollars a gallon, and a trip to Starbucks for a small latte' makes your pocket three hundred dollars lighter. When bad things happen, they seldom care whether or not we are ready for them. Bad as your scenario is, now imagine a world in which you cannot buy bread or milk for ANY amount of dollars... but you CAN still trade for them using either your labor or gold and silver. While this may not be likely, it IS possible. |
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Valued Member
United States
407 Posts |
Although my post is partly in jest, I think there is a little bit more to a world I describe, and particularly the one YOU just described! It's easy to make the assumption that when such a time occurs that gold and silver will still be barterable commodities, because it's always been so. With the corruption of society to such a state, gold and silver may as easily no longer carry such a value.
Such conditions may appear at some time in the future, but I don't realistically see them occurring in my lifetime.
Soylent green.....is people!
Steve
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Pillar of the Community
United States
931 Posts |
1)Repeal the Legal Tender laws 2)Freeze the current supply of Federal Reserve Notes 3)Define the "real" dollar in terms of precious metal content 4)Establish gold as an auxiliary money reserve 5)Restore free coinage at the US Mint 6)Pay off the national debt with Federal Reserve Notes 7) Pledge the governments hoard of gold and silver as backing 8)Determine the weight of our gold and silver 8)Determine the number of all Federal Reserve Notes 9)Retire and exchange all FRN's 9)Convert all contracts made in FRN's to dollars 10)Issue Silver Certificates 11)Abolish the Federal Reserve System 12)introduce free banking(100% reserve) 13)Reduce the size and scope of government 14)Restore national independence
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Replies: 18 / Views: 2,375 |
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First Page
Posted 08/10/2011 02:06 am
