Quadaffi Killed Trying to Establish an African Currency?

The BIS does not settle members transactions using gold. Gold makes up only a small fraction of international reserves.

As oppose to now where the requirement is that taxes are paid by a non gold backed currency. The only difference is the non productive hoarding of a shiny metal by governments.

Governments don't use gold backed currencies because it puts them at a disadvantage to fiat ones.

originally posted by: dragonridr

Well using logic there is about 14.7 trillion US debt. Came up with a total of 120,049,020,000 ounces at the current price of gold . There is currently 147.3 million ounces of gold in Fort Knox meaning there is no chance this could ever happen.

Why does the amount of gold needed to establish a currency have to match the US debt? The US debt was created by the private Federal Reserve corporation by charging interest on currency they created out of thin air. If the US wanted to pay it, we could just print a fiat 20 trillion dollar bill and tell them to keep the change. It would then fall on the private Federal Reserve corporation and their stockholders to make good on what they created.

And if gold is money, then the currency supply wouldn't be limited to whatever gold is in Fort Knox. Like many people, I have coins, bullion, jewelry, and scrap; all of which could be used as money. Plus, more gold is being mined and recovered from scrap all the time. We've barely scratched the surface of the Earth. We have no idea how much we may find under the oceans, Antarctica, the Sahara, etc.

But at least you came up with a number, over 120 billion ounces. So, according to your reasoning, if we could acquire 120 billion ounces, there would be enough gold to use as currency.

originally posted by: PhoneyBaloney
Gaddafi wanted a unified Africa and a gold backed currency for this union to use, he thought he could obtain this by complying with western countries needs in north africa like the UK and France.

Gaddafi, the ex-Libyan dictator, wanted an Africa which he led. It was therefore a fantasy. If he wanted a gold-backed currency called the "gold dinar" (as per the OP), it was in direct conflict with the rest of Africa who had already decided (in the early 1990s) to converge towards a pan-African currency, known as the Afro.

The OPs assertion is therefore wrong.

originally posted by: AugustusMasonicus

originally posted by: VictorVonDoom
Then the original question remains. You say there is not enough gold for any country to use as currency, how much gold would be enough?

If possible, please state your answer in kilos or some other universally recognized unit of mass.

For an economy the size of the United States it would be upward of $15trillion using the current spot price.

Why would it have to be $15 trillion at current spot price for the US? If it would be less for a smaller economy like Haiti, then a gold backed economy would still be feasible, right? Would it be worth having a smaller economy to be rid of the debt slavery imposed by the Federal Reserve Bank's fiat currency system, or is a smoothly humming economy more important than freedom?

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Let's cut to the chase, here. When you said there wasn't enough gold to back any currency, that wasn't a statement of fact, that was a statement of faith. Like believing in a Supreme Being, there's no way you can prove it, but you're going to believe it no matter what.

Not that I have a problem with that. I am the last person to denigrate anyone's faith. But I know a man as intelligent as yourself can recognize the difference between fact and faith.

originally posted by: VictorVonDoom

originally posted by: dragonridr

Well using logic there is about 14.7 trillion US debt. Came up with a total of 120,049,020,000 ounces at the current price of gold . There is currently 147.3 million ounces of gold in Fort Knox meaning there is no chance this could ever happen.

Why does the amount of gold needed to establish a currency have to match the US debt? The US debt was created by the private Federal Reserve corporation by charging interest on currency they created out of thin air. If the US wanted to pay it, we could just print a fiat 20 trillion dollar bill and tell them to keep the change. It would then fall on the private Federal Reserve corporation and their stockholders to make good on what they created.

And if gold is money, then the currency supply wouldn't be limited to whatever gold is in Fort Knox. Like many people, I have coins, bullion, jewelry, and scrap; all of which could be used as money. Plus, more gold is being mined and recovered from scrap all the time. We've barely scratched the surface of the Earth. We have no idea how much we may find under the oceans, Antarctica, the Sahara, etc.

But at least you came up with a number, over 120 billion ounces. So, according to your reasoning, if we could acquire 120 billion ounces, there would be enough gold to use as currency.

US debt is issues by the treasury, not the Federal Reserve. The obligation is on the US government.

The US government could of course convert debt to dollars but there would be consequences or requirements for doing so.

Gold standard is not same as saying gold is money. If the the US wanted to go back on a gold standard it would need to own reserves sufficient to back the dollar (probably not as high as 14trillion worth but still way more than it currently has).

All of which ignores that gold backed currency is fundamentally a bad idea.

originally posted by: VictorVonDoom
If it would be less for a smaller economy like Haiti, then a gold backed economy would still be feasible, right?

Nope. Because they would still need to obtain an amount equal to or greater than the currency in circulation, the outstanding debt and any monetary savings. Tell me how Haiti is going to do that.

Let's cut to the chase, here.

Let's. You have a very flawed concept of rudimentary macroeconomics and are trotting out tropes about why a gold-backed currency is feasible when it has been demonstrated via all historical examples that it is not and that the system is not sustainable in a world economy.

Perhaps in some sort of closed loop where outside trading is denied but then your country will languish as the rest of the world progresses without you.

a reply to: VictorVonDoom

Well to answer your question if you use gild to back currency it has to back all the currency in circulation. If you removed this debt without having something to back it you cause a world wide crash of the economy. You instantly cause hundreds of countries to crash.

Now more gold being mined is counter productive. If gold becomes common it has no value. So arguing that we may find its abundant defeats the purpose again it would cause market crashes. The other thing about gold backed currencies its easy to cause a crises. People forget about black friday and the crash caused by gold.

Gould and Fisk saw an opportunity to corner the gold market and thus profit directly off Uncle Sam. Gould bought up gold starting in summer 1869 and refused to sell any of it, driving up prices. This hording was scheduled because he knew the government was going to release more currency to cover debts. Right before the US released this gold on the market he sold all he had.

This caused a $20 Double Eagle gold pieces to trade at $162 each; by the end of the day the premiums were almost nil, meaning the price of one coin fell $142. The $4 million in coins that the government put on the market thus caused $28,400,000 in lost investments, or about $490 million today. This caused investors to go broke because they tied there wealth to gold.