Return to the gold standard?

There is begining to be talk of a return to a gold backed currency model in political circles. The gold standard offers advantages but comes with risks too. Here is a basic run down of how it works and it's pros and cons.
Gold Standard

It seems that the process suffers from the same basic issue as our fiat currency models of today... Cheating.


Here is a look at the largest gold reserves in the world and value at market price at the time of writing.
Gold reserves

I honestly think the majority of the financial problems facing the world is because of fiat currency. I also think that returning to a gold standard is a good step in the right direction, but far more is necessary. The sad reality is that the Elite will never allow this to occur.

Do you really belive the USA has that much gold? They lie about everything else, why not this too?

reply to post by Fiberx


Is there any gold left?
Rumors abound of missing gold and more gold sold than actually exists..

I don't believe it is going to matter what we use to back a currency, or use as the currency itself. At any time, the people in charge can manipulate and alter the value of whatever we use to buy our basic goods.

Until we are willing to grow up and understand that a monetary system only divides the "have's and have-nots", it will not matter one bit. Whether it's gold, or the USD, you have no control of the value....but they do!

When we get past the paradigm we are currently stuck in, society will have no need for money as all our basic needs will be taken care of with no strings attatched. Then the greedy, manipulative people will have no way to hold a thumb over us.

Seems to me that would be the natural progression of any society, IMO.

Originally posted by backinblack
reply to post by Fiberx

 

Is there any gold left?
Rumors abound of missing gold and more gold sold than actually exists..

Yeah i want to know who sold all this gold

Originally posted by backinblack
reply to post by Fiberx

 

Is there any gold left?
Rumors abound of missing gold and more gold sold than actually exists..

History International has been playing that Fort Knox gold program alot lately. I watched it day before yesterday.

They swear it is in there. I would like to see it though. It might be painted lead.

Originally posted by sheepslayer247
I don't believe it is going to matter what we use to back a currency, or use as the currency itself. At any time, the people in charge can manipulate and alter the value of whatever we use to buy our basic goods.

Until we are willing to grow up and understand that a monetary system only divides the "have's and have-nots", it will not matter one bit. Whether it's gold, or the USD, you have no control of the value....but they do!

When we get past the paradigm we are currently stuck in, society will have no need for money as all our basic needs will be taken care of with no strings attatched. Then the greedy, manipulative people will have no way to hold a thumb over us.

Seems to me that would be the natural progression of any society, IMO.

the problem is you are lead to belive this is a true Capitalist market, its not! A true capitalist market would bring this country out of the depretion.

I dont see the world ever going back to a gold standard. Its simply not in the bankers or the poloticians best interest.

Return to a gold standard? my own thoughts:

Option 1 - Fiat currency provided by the banks (current system)
Option 2 - Fiat currency provided by the banks on a Gold Standard
Option 3 - Fiat currency owned and controled on behalf of the people
Option 4 - Fiat currency owned and controled on behalf of the people on a Gold Standard

Option 1 & 2 require heaviest taxation due interest to private third parties
Option 3 would be my personal choice
Option 4 is open to manipulation through the gold, which globally cannot be owned and controled on behalf of the people

All 4 Options have at least 1 major flaw that comes to mind - they ALL require them to be operated and regulated by people with honesty and integrity. How this is over come may be the harder question to answer.

Edit to add: S&F to the OP, I've been waiting for this thread, hope it gets well read and commented on.

reply to post by lokdog


We have to stop being defeatest. We DO have the power. We allow the system to function and we can force it to change. It requires cooperation but in the end, the masses do rule, if they are willing to.

I had a discussion about a tax model that I devised, with a gentleman who operates a currency trading firm. He is well monied and privilaged but still has values that "average" folks would identify with.

When I reach the part of the model that deals with taxation of the wealthy I said to him that I understood that it would be a tough sell to the top 1-2% of earners....

His reply?

"So? You don't need the permission of that 1%..."

Damn straight we don't, in fact they need us. It's a matter of will on the part of citizens, that's it.

Now to the topic..

I the basic view I am getting is that commodity backed currency is great for stability of currency values and of inflation. It is however prone to inflexibility during crisis. I will need to look deeper to understand that risk enough to have a full opinion on the method.

It does seem to me that stable values of currencies would be a big plus in our global trading system.

The biggest issue I see is the unwillingness of many nations to participate, either because they lack significant gold reserves or because the mess that is our current system is a honey pot of exploitation for them (ie. China who has artificially suppressed their currency for decades to exploit export/import imbalances).

reply to post by camaro68ss


Correct, this is not a true capitolist market. If it were, it would bring us out of the deppresion but it would do nothing that delay the eventual downturn that all monetary markets must go through. Unfortunatly, capitolism will never be sustainable in any long term fashion.

reply to post by Fiberx


There are plenty of issues with going to a metal based currency. The worst one is the currency can only expand as fast as the metal is mined, less any industrial use of that metal. This would prohibit the building of any national savings of any kind. It would truly be a case where you could only accululate excess money by taking it from someone else. In order to increase the amount of currency, the government would have to buy metals, driving up their price and thus causing an echo of inflation throughout the sytem. So basically, even if there is enough gold to cover the world's currency needs, I seriously doubt there is enough to allow adequate economic growth over time.

If you allow banks to create money to solve this problem, then what is the point of it in the first place? I don't think there is any getting around this particular issue.

Originally posted by sheepslayer247
I don't believe it is going to matter what we use to back a currency, or use as the currency itself. At any time, the people in charge can manipulate and alter the value of whatever we use to buy our basic goods.

Until we are willing to grow up and understand that a monetary system only divides the "have's and have-nots", it will not matter one bit. Whether it's gold, or the USD, you have no control of the value....but they do!

When we get past the paradigm we are currently stuck in, society will have no need for money as all our basic needs will be taken care of with no strings attatched. Then the greedy, manipulative people will have no way to hold a thumb over us.

Seems to me that would be the natural progression of any society, IMO.

Great post. I think you are 100% correct. I just hope I see it my lifetime and that we don't have to undergo a great catalysm in order to get there.

reply to post by sligtlyskeptical


The growth of the money supply is definately a major issue, however we are in the process of learning to exploit new supplies of material in space.

Additionally, we don't have to be limited to gold. We could use a range of commodities. The US operated a bimetal system during the classic period mentioned in the article I posted, adding silver to the mix.

We could back currency with anything that has real demand, theoretically.

reply to post by Fiberx


There's just not enough gold to effectively use a gold standard. You might as well have a blue diamond-backed currency, or a Rick Astley-based currency.

A gold-based currency has the same problem as a fiat-based currency. Gold's value is not inherent - it's determined by what someone else is willing to say it's worth. At least with a fiat currency, that value is centrally controlled, preventing the currency from being very "wobbly" (not completely stable, there's no way to do that, just not as wobbly as a variable resource)

Most of the politicians who are talking about a gold standard are either heavily invested in gold mining (such as Ron Paul) or are clueless Friedmanites who don't know how economies work (Like, uh, Ron Paul)

reply to post by TheWalkingFox


Same question different thread.......

Do you have anything positive to add to this thread? That is, as opposed to critical analysis of others contributions, what sensible options do You have to contribute that do not require a dream like state or a magic wand ?

Originally posted by camaro68ss
Do you really belive the USA has that much gold? They lie about everything else, why not this too?

We always understate and under report our holdings so that certain fools can't get their greedy hands on it.

Ok, for a site of conspiracy theorists, i'm surprised no one has yet mentioned (or at least I don't think so, just skimmed) that a gold standard is a part of the private bankers plans - they already own most of the gold!! By destroying our wealth and then moving to a gold standard, they increase their power even more, especially if it's a world currency!! Do not fall for the gold standard as a solution to our currency crisis. Debt-free money issued by the real government is the solution, don't let anyone convince you otherwise.