Return to Gold Standard

[Will E Worm]

Republicans Eye Return to Gold Standard

The gold standard has returned to mainstream U.S. politics for the first time in 30 years, with a “gold commission” set to become part of official Republican party policy.

Drafts of the party platform, which it will adopt at a convention in Tampa Bay, Florida, next week, call for an audit of Federal Reserve monetary policy and a commission to look at restoring the link between the dollar and gold.

The move shows how five years of easy monetary policy — and the efforts of congressman Ron Paul — have made the once-fringe idea of returning to gold-as-money a legitimate part of Republican debate.

Marsha Blackburn, a Republican congresswoman from Tennessee and co-chair of the platform committee, said the issues were not adopted merely to placate Paul and the delegates that he picked up during his campaign for the party’s nomination.

“These were adopted because they are things that Republicans agree on,” Blackburn told the Financial Times. “The House recently passed a bill on this, and this is something that we think needs to be done.”

The proposal is reminiscent of the Gold Commission created by former president Ronald Reagan in 1981, 10 years after Richard Nixon broke the link between gold and the dollar during the 1971 oil crisis. That commission ultimately supported the status quo.

“There is a growing recognition within the Republican party and in America more generally that we’re not going to be able to print our way to prosperity,” said Sean Fieler, chairman of the American Principles Project, a conservative group that has pushed for a return to the gold standard.

A commission would have no power except to make recommendations, but Fieler said it would provide a chance to educate politicians and the public about the merits of a return to gold. “We’re not going to go from a standing start to the gold standard,” he said.

The Republican platform in 1980 referred to “restoration of a dependable monetary standard," while the 1984 platform said that “the gold standard may be a useful mechanism”. More recent platforms did not mention it.

Any commission on a return to the gold standard would have to address a host of theoretical, empirical and practical issues.

Inflation has remained under control in recent years, despite claims that expansion of the Fed’s balance sheet would lead to runaway price rises, while gold has been highly volatile. The price of the metal is up by more than 500 per cent in dollar terms over the past decade.

A return to a fixed money supply would also remove the central bank’s ability to offset demand shocks by varying interest rates. That could mean a more volatile economy and higher average unemployment over time.

Article

Gold and silver backing America's currency once again. :goodpost:


Did you know in 1905 there was a gold certificate $20 note with George Washington in the center?

 

[Johan]

Yeah, this is great news !
Gold is going to :
- Creates jobs for the american citizens
- Raise salaries
- Make people healthier and allow them to live longer
- Protect nature
- Lower the price of oil
- Keep US boys from being klled in Iraq or Afghanistan
- Put an end to shootings
- Improve education
- Make sure the Dems will lose every future election, America will be 100% Rep. Forever
- Even aliens in their flying-saucers would be so scared they won't get closer than 1000 light-years from the US

:elaugh:

 

[Will E Worm]

Johan, you're looking for a Utopia that will never come.

At least this is a step in the right direction.

 

[Bearded_Menace]

Oh, so NOW they listen to Ron Paul eh? Should have been doing that 10 years ago.

 

[xfire]

Here you go, Asshat. You posted the wrong president.

 

[Will E Worm]

Here you go, Asshat. You posted the wrong president.

I just posted the trivia as trivia. Not to go along with the picture.

 

[xfire]

I just posted the trivia as trivia. Not to go along with the picture.

Ok, that makes sense. I like Reuben sandwiches.

 

[elwoodmartini]

Ron Paul just owns a ton of gold, so he just talking his own book. He's actually betting against an American recovery with a hedge like that. Stocks are a better bet on the recovery. Ron says stop "spending". We as a country should be taking advantage of the lowest rates in a very long time to shore up our nations balance sheet like corporations did. Sell some 30 year bonds.
I know the argument. The gov is just going to waste any money it gets. So why give them any.
My answer to that is the gov is made of humans and untill someone figures out a way to stop humans from doing the wrong thing, that's all we have. By the way there is Corruption in the church,police,schools,hedge funds,hmm what else.

 

[Rey C.]

One of the arguments that I've heard from people who favor a return to the gold standard is that it is better for a currency to be based on something with intrinsic value. But you can't eat gold. You can't drink gold. You can't live in gold. You can't wear it for clothing. In truth, gold has a market value with an elastic demand curve (price levels impact demand), not a true intrinsic (actual or essential) value with an inelastic demand curve (price levels do not impact demand as much). Think about it, no matter how much they cost, there will ALWAYS be a demand for food, clothing and shelter - not so with gold.

The other argument I've heard from those who favor a return to the gold standard is that the gold standard would smooth out economic cycles. But those people tend to forget that we were under the gold standard when the Great Depression started, and many of the recessions that preceded the Great Depression were actually quite severe, with longer periods of high unemployment. By its very nature, it's more difficult to reflate an economy if under a gold standard. And if deflation takes hold, that's seen as a harder problem to cure than inflation. So even though there are some positives to the gold standard, it is not a magic bullet by any stretch. It's like when people talk about a flat tax or eliminating the Fed. Theories are nice, but implementation is usually a different matter.


For anyone curious about economic conditions in the U.S. during various periods, here is a good resource: Historical Statistics of the United States

 

[Bearded_Menace]

One of the arguments that I've heard from people who favor a return to the gold standard is that it is better for a currency to be based on something with intrinsic value. But you can't eat gold. You can't drink gold. You can't live in gold. You can't wear it for clothing. In truth, gold has a market value with an elastic demand curve (price levels impact demand), not a true intrinsic (actual or essential) value with an inelastic demand curve (price levels do not impact demand as much). Think about it, no matter how much they cost, there will ALWAYS be a demand for food, clothing and shelter - not so with gold.

The other argument I've heard from those who favor a return to the gold standard is that the gold standard would smooth out economic cycles. But those people tend to forget that we were under the gold standard when the Great Depression started, and many of the recessions that preceded the Great Depression were actually quite severe, with longer periods of high unemployment. By its very nature, it's more difficult to reflate an economy if under a gold standard. And if deflation takes hold, that's seen as a harder problem to cure than inflation. So even though there are some positives to the gold standard, it is not a magic bullet by any stretch. It's like when people talk about a flat tax or eliminating the Fed. Theories are nice, but implementation is usually a different matter.


For anyone curious about economic conditions in the U.S. during various periods, here is a good resource: Historical Statistics of the United States

Some very good points made here. I, for one, did let the fact that we were on a gold standard through out many depressions slip my mind.

 

[Supafly]

On the upside, the gold standard would possibly make the US money system more solid.

On the downside... to cover all the extra cash created, you would have to invade some extra countries and this would mean you would have to some extra billion dollars in doing so.

 

[D-rock]

Ummm...why do people pretty much ignore the fact that any return is so far from practically being possible anymore as to be laughable? It's not going to happen and most of the politicians and influential elite clamoring for it know it can't and won't happen. It's something they say because dumb people that don't know any better will like them for it, and can't tell they are blowing smoke up their asses.

 

[Master Roshi]

a return to the gold standard is impossible though I would not mind seeing it happen because having a paper currency that is backed by a hard asset does force a country to be fiscally responsible but IMO its just not possible to do in today's economic environment, what is viable is what JFK tried to do before he was killed and that is get some honest US treasury representatives to take over the private federal reserve and nationalize it, by doing this the US can print its own currency (not federal reserve notes but US notes) and not incur an ever surmounting national debt to an off-shore Rothschild/Rockefeller/Morgan Mega Banking Dynasty

 

[Rey C.]

a return to the gold standard is impossible though I would not mind seeing it happen because having a paper currency that is backed by a hard asset does force a country to be fiscally responsible but IMO its just not possible to do in today's economic environment, what is viable is what JFK tried to do before he was killed and that is get some honest US treasury representatives to take over the private federal reserve and nationalize it, by doing this the US can print its own currency (not federal reserve notes but US notes) and not incur an ever surmounting national debt to an off-shore Rothschild/Rockefeller/Morgan Mega Banking Dynasty

An honest banker? You've got a better chance of asking Santa for a naked porn star under the Christmas tree and having her appear on Xmas morning.

 

[Master Roshi]

An honest banker? You've got a better chance of asking Santa for a naked porn star under the Christmas tree and having her appear on Xmas morning.

lol very true Rey C, very true

 

[Straight Shooter]

This is the difference between conservatives and liberals. I'm a progressive meaning I want to make progress, I want to move forward. While Will is over here talking about going back to the 20th century. While we're at it why don't we bring back the horse and buggy? why don't we go back to shitting in the woods? why don't we bring back the telegraph? etc