- Date: Fri Sep 18 1998 03:10
farfel (@ALL....thanks again for all your continued...) ID#341227: - ...kind words and support in my recent absence.
Thanks.
F*
- Date: Fri Sep 18 1998 02:49
farfel (ADDENDUM to previous GOLD STANDARD post....) ID#341227:
Copyright © 1998 farfel/Kitco Inc. All rights reserved - Although a gold standard is viable, nevertheless, the metal is an unwieldy reserve in terms of storage and distribution. In that sense, it is not entirely consonant with our modern, computerized world ( at least, our modern Y2K-FREE world...if computers begin crashing en masse soon, then public perception of our modern world will certainly change quite dramatically. In such a scenario, gold may NOT seem like such a relic from the past ) .
That is why I have advocated some kind of hybrid global currency reserve...part gold standard, part paper ( cyber ) standard. It's exact nature would be determined by the Community of Nations at a major confab in the future.
Essentially, I believe that gold backing would preclude excessive monetary expansion ( running the money printing presses ad infinitum ) ; however, today, gold backing at the lower end of the percentage scale makes more sense. No matter what percentage, there must be some kind of fixed, inexorable global constraint upon the tendencies of governments to print money whenever they desire it.
Thanks.
F*
- Date: Fri Sep 18 1998 02:34
farfel (Gold Standard is Viable...) ID#341227:
Copyright © 1998 farfel/Kitco Inc. All rights reserved - The notion that gold cannot be a currency standard in the world is put forward by US Dollar-centrist idealogues ( and, ergo, anti-gold propagandists ) .
In their specious arguments, they declare that the major superpowers do not have enough gold reserves to provide sufficient wealth to their respective citizens.
The arguments are supported on the foundation of US Dollar hegemony. In other words, what is gold worth in US Dollars?
However, if the US Dollar is repudiated as the global currency reserve and replaced by multi-regional currency standards, then gold's value in US Dollars alone will become meaningless. What will gold's value be in terms of Euros? What will gold's value be in terms of a new Asian Currency Standard? What will gold's value be in terms of a new, reinvented Ruble?
Even if the US Dollar were to retain its hegemony as the global currency reserve ( unlikely ) , then another substantive defect in the anti-gold standard rationale deals with the fiction that a gold standard necessitates 100% gold backing of currencies. As evident in a country such as Switzerland, a currency can be backed by less than 50% gold reserves and still be, in effect, a gold standard currency. In fact, one can choose any random percentage of gold backing ( from 5% to 100% ) -- as long as gold is either purchased or sold at a fixed rate in accordance with certain fixed rates of monetary contraction or expansion, then the percentage of gold backing can be whatever the Community of Nations agrees it should be on an arbitrary basis.
Thanks.
F*
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