Deft9
09-13-2010, 10:55 PM
In the event of a hyper-inflation situation, I thought this might work. It's probably not anything that hasn't been thought of before though.
Gold backing is ideal, but not necessary. Once hyperinflation begins, if individual states can quickly secede from the Union and begin issuing their own currency they may be saved from the worst of the depression. States could offer to distribute their currency based on people's pre-hyperinflation bank statements. There will be a push by the Bankers to get the country to switch to their own global paper currency, the SDR. The important thing is that the state turn off the printing press at a certain point to maintain a stable money supply. The state government must resist the temptation to print more money when they are struggling. Fractional reserve banking must be abolished as well. All banks must keep 100% reserves. After an adjustment period, the new state currency should be pegged to gold.
Gold backing is ideal, but not necessary. Once hyperinflation begins, if individual states can quickly secede from the Union and begin issuing their own currency they may be saved from the worst of the depression. States could offer to distribute their currency based on people's pre-hyperinflation bank statements. There will be a push by the Bankers to get the country to switch to their own global paper currency, the SDR. The important thing is that the state turn off the printing press at a certain point to maintain a stable money supply. The state government must resist the temptation to print more money when they are struggling. Fractional reserve banking must be abolished as well. All banks must keep 100% reserves. After an adjustment period, the new state currency should be pegged to gold.