WSJ today has ad saying Fort Knox is empty

[jonahtrainer]

He didn't say anything remotely close to the nonsense you twisted his post into. He has a point, the same point I've been trying to get an answer too. The US economy has an inherent value, as does the entire world's. It's far surpassed the value of some arbitrary and speculative commodity. How exactly do you plan to implement a gold standard? You could buy out all the world's gold with a fraction of solely the US dollars in circulation, let alone all those currencies of other countries.

JordanQ72 is a known troll. Do not feed the trolls.

Because of technology banks, central banks and consequently the 'gold standard' are obsolete.

 

[JordanQ72]

As people ranging from libertarians to anarcho capitalists, I've never understand how you can support a gold standard.

Do you guys understand what it means to 'fix' the dollar to some valuation in gold? It means a complete manipulation of the gold markets by the governments. That never made any sense to mean, as an argument put forth as a good idea by people dead set in as much free market notions as possible.

Let gold be gold, let a government's currency be currency, and the two float as the free markets see fit.

 

[JordanQ72]

JordanQ72 is a known troll. Do not feed the trolls.

Oh, is that the only reply you have to me sweetie? When someone asks some pointed questions just call them a troll? Great

You know, if your theories were resting on such solid foundations, an explanation shouldn't be at all complicated.

 

[jonahtrainer]

Oh, is that the only reply you have to me sweetie? When someone asks some pointed questions just call them a troll? Great

You know, if your theories were resting on such solid foundations, an explanation shouldn't be at all complicated.

We've been here before many times and you are simply trolling again.

Do you guys understand what it means to 'fix' the dollar to some valuation in gold? It means a complete manipulation of the gold markets by the governments.

You obviously do not have the most basic understanding of how the monetary terms developed. Rothbard's Case for 100% Gold Dollar explains how the term 'dollar' was used to denote a weight, purity and metal (371.25 grains of .999 pure silver). So likewise Franc, Pound, etc. There is no government manipulation at all. It is like saying there is government manipulation for defining a football field as 300 yards.

 

[pdavis]

As people ranging from libertarians to anarcho capitalists, I've never understand how you can support a gold standard.

Do you guys understand what it means to 'fix' the dollar to some valuation in gold? It means a complete manipulation of the gold markets by the governments. That never made any sense to mean, as an argument put forth as a good idea by people dead set in as much free market notions as possible.

Let gold be gold, let a government's currency be currency, and the two float as the free markets see fit.

We are not calling for fixing the price of gold, we are calling for the dollar to be defined as a weight of gold. The price (value measured by what must be given or done or undergone to obtain something) of gold would still be determined by the market place. For example, if the price of a personal computer is 3 oz. of gold, then the price of gold is 1/3 of a personal computer.

 

[JordanQ72]

We are not calling for fixing the price of gold, we are calling for the dollar to be defined as a weight of gold.

Well that's just semantics, you want the government to engage in price fixing. Say a government wants gold to be $100 to an ounce. To maintain something like that, requires a manipulation of the gold markets. For every new ounce of gold found, the government would issue $100 dollars. This is direct market manipulation in my opinion. You can have a gold standard with fiat money in that case, the FED just conducts open market operations in response to market movements in gold to allow people to buy and sell dollars for a constant amount of gold.

 

[pdavis]

Well that's just semantics, you want the government to engage in price fixing. Say a government wants gold to be $100 to an ounce. To maintain something like that, requires a manipulation of the gold markets. For every new ounce of gold found, the government would issue $100 dollars. This is direct market manipulation in my opinion. You can have a gold standard with fiat money in that case, the FED just conducts open market operations in response to market movements in gold to allow people to buy and sell dollars for a constant amount of gold.

No, I am not calling for the government to engage in price fixing, again I am calling for the dollar to be defined as a weight of gold just as an inch is defined as 1/12 of a foot. If anything it is you who wants price fixing by allowing the government through a central bank to "conduct (direct the course of; manage or control) open market operations in response to market movements in gold to allow people to buy and sell dollars for a constant (a quantity that does not vary; a fixed value) amount of gold.

 

[JordanQ72]

I am calling for the dollar to be defined as a weight of gold

I see, so you're actually asking that something slightly different be done than was even used when this country was on a gold standard. Back when America was on a gold standard, gold and dollars would have a fixed exchange rate that the government would work on maintaining. Yes, it translated into a certain weight of gold being exchanged, because there is no other way to measure gold, but the government conducted itself to maintain this ratio. This ratio didn't somehow maintain itself through varying reserves and findings of gold.

 

[Fox McCloud]

Bill Still is right when saying gold is not the answer. This is where I disagree with Ron Paul in going to gold standard and commodity based currency. The creator of the Money Masters Bill Still's proposal of government issued fiat from the U.S. Treasury is the answer to the mess of fractional reserve banking.

So, you don't believe the statistics? The statistics that have shown that all fiat currencies fail? Sorry buddy...but I've dealt with fiat currency all my life, and I don't like it one bit....not only that, it's dirty and nasty (and could carry disease on it)....that is, if it's paper.

gold/silver is stable (relatively), and if used in coins is a natural anti-bacterial.

 

[ams5995]

Colonial Script was fiat - it worked as did Greenbacks as did Tallysticks!

Fiat is the same as GOLD! They are both what people perceive money to be.

The evil is private fed having a monopoly on the currency.

I am against fractional reserve banking and the fed having a monopoly on our currency.

I am for hard assets and competing currencies - even if that means a currency that is fiat or platinum (or any other element)! May the best currency win, may we be free to chose what we want to pay with.

 

[ams5995]

please explain if possible

He has no credibility.

Bradley, can you please explain why he has no credibility? I myself found Money Master enlightening as well as factual. Is there some kind of rebuttal to him or the movie? I sure don't want to go around promoting a position on the Federal Reserve if there is no credibility behind it.

 

[paulgirl]

Any amount of gold would be enough.

In the process of moving to a gold standard, the price of gold would be fixed relative to the dollar at a level much higher than the current price -- perhaps $30,000 per ounce, based on the current money supply and the government's stated reserves (which are probably wrong).

This concept has been written about extensively. Edward Griffin talks about this in "The Creature from Jekyll Island". You also might want to check out Ron Paul's book, "The Case for Gold".

I have read some of these arguments, and they just don't make sense from an economic perspective. By fixing the gold price relative to the "dollars" in our economy, you are trading one fiat currency for another. Gold is only worth what it is inherently worth, and it will never be worth 30k (of the current money supply). If you look at the price of gold relative to what it buys, i.e. how much food, oil, etc., the average over time is about the same. It is for sure somewhat undervalued today; it might be worth double, or about $1600 or $1800. It can't be worth $30k. Gold has a certain inherent worth over time, thus if you save money in gold then you can expect to get about the same return for that gold in 50 years. For individuals, in one way, that is good because you don't need to rely on interest because interest offsets inflation. In another way, that is bad because you cannot capitalize on the time value of money -- earning interest on your interest.

Because the world's population is much bigger than it ever has been, the output of the world's economy is many, many times what can be expressed in gold. All of the world's gold, silver, platinum, palladium, copper and any other valuable metal you can think of would only be a fraction of the total economy. People are what makes something valuable -- people's work to get/ make something (miners, farmers, manufacturers, etc.) and people's need or desire to get that thing. Because the population and their outputs and desires have far exceeded the fixed amount of gold above and under the ground, to go backwards and fix that gold to people's outputs and desires would be creating a fiat currency.

I agree we are in a pickle with the way our currency has been managed. But a "gold standard' in the traditional sense cannot and will not work.

 

[jonahtrainer]

By fixing the gold price relative to the "dollars" in our economy, you are trading one fiat currency for another. Gold is only worth what it is inherently worth, and it will never be worth 30k (of the current money supply). If you look at the price of gold relative to what it buys, i.e. how much food, oil, etc., the average over time is about the same. It is for sure somewhat undervalued today; it might be worth double, or about $1600 or $1800. It can't be worth $30k.

Gold is not fiat currency. Gold is money. Fiat currency are money substitutes. Why can't gold trade at 1/30,000 ounce per dollar? The time will come, as it always does, when gold will not be for sale for dollars at any price. The nature of fiat currency money substitutes is that they always become worth nothing. But at all times and in all circumstances gold remains money and is valued. Gold can never become worth nothing.

The current MZM has about $46,000 per ounce of gold. The exchange rate between US$ and gold will change depending on the supply and demand of the commodity, gold, and the synthetic commodity, the US$.

The 28% rate gain on bullion reduces the demand for gold. The legal tender laws increase the demand for US$. The Fed prints dollars out of thin air increasing the supply. Central banks around the world shy away from accumulating US$ thus reducing demand. All of these factors play a role.

To be safe RunToGold.com.

 

[NoMoreApathy]

As people ranging from libertarians to anarcho capitalists, I've never understand how you can support a gold standard.

Do you guys understand what it means to 'fix' the dollar to some valuation in gold? It means a complete manipulation of the gold markets by the governments. That never made any sense to mean, as an argument put forth as a good idea by people dead set in as much free market notions as possible.

Let gold be gold, let a government's currency be currency, and the two float as the free markets see fit.

Who's holding the reserves? Private banks?

 

[AceNZ]

Well that's just semantics, you want the government to engage in price fixing. Say a government wants gold to be $100 to an ounce. To maintain something like that, requires a manipulation of the gold markets. For every new ounce of gold found, the government would issue $100 dollars. This is direct market manipulation in my opinion.

In your example, the government only has to issue $100 for every ounce of gold presented to it, not for every ounce in existence. Only the gold in its possession is used to back the currency.

However, this type of "market manipulation" is limited to the amount of gold that a potential manipulator can obtain. Compare that to fiat money, where the government can print an arbitrary amount of money and insert it into circulation. Which approach is more open to manipulation?

I have read some of these arguments, and they just don't make sense from an economic perspective. By fixing the gold price relative to the "dollars" in our economy, you are trading one fiat currency for another.

That's not correct. What makes a currency "fiat" is that there's nothing backing it up. With fiat money, the government can print as much of it as they want. With a gold-backed money, in order to put new money into circulation, a certain amount of gold has to exist first.

Gold is only worth what it is inherently worth, and it will never be worth 30k (of the current money supply). If you look at the price of gold relative to what it buys, i.e. how much food, oil, etc., the average over time is about the same. It is for sure somewhat undervalued today; it might be worth double, or about $1600 or $1800. It can't be worth $30k.

Why can't it be worth $30k? If gold backed the currency, the demand for it would increase. The price of gold went up by about 20 times from the early 70's to 1980 -- we're only talking about going up another 30 times.

However, having said that, you're looking at this backwards. It's not that gold is worth a certain amount of money. Rather, it's that the dollar is worth a certain amount of gold. When gold is used as money, its value is decoupled from its value as a commodity.

Because the world's population is much bigger than it ever has been, the output of the world's economy is many, many times what can be expressed in gold.

Only if gold is priced as a commodity. When used as money, that's not correct.

The current MZM has about $46,000 per ounce of gold. The exchange rate between US$ and gold will change depending on the supply and demand of the commodity, gold, and the synthetic commodity, the US$.

Agreed. Current (stated) US gold reserves are about 8100 tons. The money supply as measured by M3 is about 11 trillion dollars. Dividing one by the other would make the value of the dollar about 1/46500th of an ounce of gold.