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View Full Version : Why is the gold standard "goofy"?




Karsten
11-14-2007, 02:00 PM
It seems that often whent the mainstream media talks about Ron Paul wanting to go back to the gold standard, they characterize is as goofy or fringe. What's so objectionable about the gold standard?

derdy
11-14-2007, 02:02 PM
It's goofy because then the government can't print money out of thin air and it also does away with the business cycle which we are currently in the midst of (the bust end of it)

Chester Copperpot
11-14-2007, 02:04 PM
Its considered old fashioned and passe... Its neither... Only gold and silver are money..


"Paper is not money, it is only the ghost of money" - Thomas Jefferson

derdy
11-14-2007, 02:14 PM
You also see paper money mentioned negatively throughout the Federalist Papers.

From Federalist Number 10 - James Madison

The influence of factious leaders may kindle a flame within their particular States, but will be unable to spread a general conflagration through the other States: a religious sect, may degenerate into a political faction in a part of the Confederacy; but the variety of sects dispersed over the entire face of it, must secure the national Councils against any danger from that source: a rage for paper money, for an abolition of debts, for an equal division of property, or for any other improper or wicked project, will be less apt to pervade the whole body of the Union, than a particular member of it; in the same proportion as such a malady is more likely to taint a particular county or district, than an entire State.



I'll post some more quotes when I get to work.

fsk
11-14-2007, 02:34 PM
I have a lot of good information on the Federal Reserve and the gold standard on my blog. I'm not reposting it here.

Essentially, the gold standard is a defender of individual property rights. Under a gold standard, individuals have their savings protected from inflation. Under a gold standard, you can't have a massive Federal Reserve subsidy to the financial industry. Under a gold standard, you can't have negative real interest rates.

The gold standard "failed" because it was attacked by government regulations. The idea that a gold standard doesn't work is pure propaganda.

seapilot
11-14-2007, 05:38 PM
Because they think you have to carry around gold coins instead of an AE gold card. It sounds like a foriegn idea because they never really thought about it and seems backward idea in the high tech digital money age of debit and credit cards, heck the banks would love to get rid of cash too (only supposedly criminals use cash).

Try taking out 10G of your money out of your savings account at the bank, you will have to do paperwork. Its ironic that all the credit cards are called, Platinum, Gold card etc plastic after the real deal. Gold is inflexible, costs a lot and is hard to get, reason govt hates it. It restricts govt from growing too big, dont believe me then look what happened when FDR made it illegal to own it and started printing money. Govt got fat on paper diet. Its hard to believe going back to the Gold Standard because it probably would restrict the money supply, but this would almost kill inflation. Gold is the antidote for inflation because it is real money. Has been always will be.

Those ones now that thinks its goofy wont think its goofy when hyperinflation kicks in, they will be begging for a stable currency. Unlike the currency now that is" good as the government," a new one would probably work based on gold, silver, copper etc.

hard@work
11-14-2007, 05:41 PM
A better question is why haven't we had an audit of Fort Knox in a generation?

:)

kylejack
11-14-2007, 05:42 PM
Because it assigns a fixed price to gold rather than letting it float. Ron Paul favors legalization of alternative currencies rather than the gold standard.

aravoth
11-14-2007, 06:05 PM
Nothing is wrong with the gold standard. Government regulated the living crap out of gold, they even stole it from the people during the gold seizure to help end the depression.

The establishment hates the idea becuase they are way too stupid to live within thier means. And they ware way to authoritarian to allow people the kind of security that comes with an inflation proof currency.

After all, if there was no inflation, there woudln't be loss of savings, and overtime, most social programs would become absolete. But, Government needs a peasent class, it's how they get votes. They rob wealth from the poor through inflation, not to mention forcing the poor to subsidize themselves through a variety of taxes, and then they come up with a solution to the problem they created. It's rediculous.

lurker
12-02-2007, 01:21 AM
There is a good explanation of the hostility to the gold standard. It is published in the book "Capitalism: The Unknown Ideal" by Ayn Rand (http://www.amazon.com/Capitalism-Ideal-Ayn-Rand/dp/0451147952/ref=pd_bbs_sr_1?ie=UTF8&s=books&qid=1196579431&sr=1-1).

You can read the relevant chapter here: http://www.constitution.org/mon/greenspan_gold.htm.

A few good excerpts:

But the opposition to the gold standard in any form — from a growing number of welfare-state advocates — was prompted by a much subtler insight: the realization that the gold standard is incompatible with chronic deficit spending (the hallmark of the welfare state). Stripped of its academic jargon, the welfare state is nothing more than a mechanism by which governments confiscate the wealth of the productive members of a society to support a wide variety of welfare schemes. A substantial part of the confiscation is effected by taxation. But the welfare statists were quick to recognize that if they wished to retain political power, the amount of taxation had to be limited and they had to resort to programs of massive deficit spending, i.e., they had to borrow money, by issuing government bonds, to finance welfare expenditures on a large scale.

......

In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value.

......

This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists' antagonism toward the gold standard.

......

jon_perez
12-02-2007, 01:56 AM
It seems that often whent the mainstream media talks about Ron Paul wanting to go back to the gold standard, they characterize is as goofy or fringe. Much of the arguments for using gold as money are actually quite sound. But then again, there are also many, many important reasons for the world having moved away from the gold standard. Presenting "conspiracies" as being the reason for such a move are a complete cop-out, imo.

We are all aware of the tendency of some of the more irresponsible media to try to engage in sensationalism. The problem is that some of the more overzealous, philosophically-purist RP supporters end up giving the "mainstream media" an excuse to latch onto some of the more exotic beliefs that can be associated with our man, Paul.

Far be it for me to dilute what RP's message is all about (well actually, "peace and freedom" sums it up for me :) ) but perhaps some are falling into the danger of making Paul out to be more fringe and radical than he actually is?

I have been listening to Paul for interview after interview after interview and I am completely puzzled as to why people would try to come up with a world-view that says mainstream media and the mythical "powers-that-be" are trying or would be trying to suppress Paul in any way.

Ron Paul's views threaten no one. They are good for America and they are good for the world. They are good for the "rich" and they are good for the "poor". I am sick of the divisive view that tries to paint an us-vs-them mentality as an explanation for why Paul does not seem to be "hitting mainstream".

If you/we want Paul to be more "acceptable/visible to the mainstream" then Paul's supporters should STOP DERIDING THE MAINSTREAM (as blind or bought or stupid or brainwashed or whatever...)!

Indy Vidual
12-02-2007, 01:59 AM
It seems that often whent the mainstream media talks about Ron Paul wanting to go back to the gold standard, they characterize is as goofy or fringe. What's so objectionable about the gold standard?

It's a big threat to the crooked system.

fsk
12-02-2007, 11:10 AM
If the mainstream media really were honest, they would be touting his candidacy at every opportunity, rather than barely mentioning him.

Bradley in DC
12-02-2007, 11:18 AM
Ron Paul's views threaten no one. They are good for America and they are good for the world. They are good for the "rich" and they are good for the "poor".

There is a great and justified hostility from some quarters who benefit from the ability of artificial credit creation (the government and large money center banks which get the new credit first--witness Cramer's famous outburst on CNBC). Most especially jingoists who know they couldn't start and maintain unpopular wars without monetizing the debt.

Greenspan explained part of it well here, "Gold And Economic Freedom (http://www.constitution.org/mon/greenspan_gold.htm)"; (see Capitalism, the Unknown Ideal by Ayn Rand).

Please answer my question, jon_perez. (http://www.ronpaulforums.com/showthread.php?p=512663#poststop)

fsk
12-02-2007, 01:37 PM
There are a *LOT* of people who benefit from the Federal Reserve's corrupt monetary policy. There are a *LOT* of people who benefit from "big government". They would have a hard time looting the USA if Ron Paul were President.

jon_perez
12-02-2007, 02:16 PM
There are a *LOT* of people who benefit from the Federal Reserve's corrupt monetary policy. There are a *LOT* of people who benefit from "big government". They would have a hard time looting the USA if Ron Paul were President.As long as we are clear that it is _your_ world view that the Fed was designed to "loot the USA" and not Ron Paul's. Unless of course, you can point to a quote where Ron Paul categorically states something to that effect.

Paul, after all, has never been one to beat around the bush. But all I can gather is that he is saying that "love of big government" is what goes hand-in-hand with a fiat money system. This quite different from accusations that the Fed is "designed to steal the people's wealth" which is more of an Aaron Russo assertion.

Once again, I hope you have the decency to not deliberately misconstrue or wrongly characterize these statements as "aggressively defending the Fed".

Bradley in DC
12-02-2007, 02:24 PM
As long as we are clear that it is _your_ world view that the Fed was designed to "loot the USA" and not Ron Paul's. Unless of course, you can point to a quote where Ron Paul categorically states something to that effect.

Paul, after all, has never been one to beat around the bush. But all I can gather is that he is saying that "love of big government" is what goes hand-in-hand with a fiat money system. This quite different from accusations that the Fed is "designed to steal the people's wealth" which is more of an Aaron Russo assertion.

Once again, I hope you have the decency to not deliberately misconstrue or wrongly characterize these statements as "aggressively defending the Fed".

It is of course Dr. Paul's view that the Fed was designed to pilfer the value of our money for favored special interests. The best, most colorful analogy would Dr. Paul's "purple pockets (http://www.house.gov/paul/press/press98/pr011598.htm)" speech (granted, that was about the IMF, but the principles explained in the speech carry over). [In the spirit of full disclosure, I shamelessly stole the phrase (http://www.getusout.org/artman/publish/printer_34.shtml) from Gary North's tenure.]

fsk
12-02-2007, 02:40 PM
You are free to believe that the Federal Reserve was *NOT* designed to loot the USA. You are also free to believe that the Earth is flat.

If you go around espousing flat-earth theory around a bunch of scientists, don't be surprised if they accuse you of trolling.

jon_perez
12-02-2007, 02:59 PM
It is of course Dr. Paul's view that the Fed was designed to pilfer the value of our money for favored special interests. The best, most colorful analogy would Dr. Paul's "purple pockets (http://www.house.gov/paul/press/press98/pr011598.htm)" speech (granted, that was about the IMF, but the principles explained in the speech carry over). [In the spirit of full disclosure, I shamelessly stole the phrase (http://www.getusout.org/artman/publish/printer_34.shtml) from Gary North's tenure.]See.... now you're putting your words in Ron Paul's mouth! Tsk. Nowhere in that speech is the Fed ever mentioned.

I don't doubt that Paul does not like the Fed, but have you stopped to consider that all this reckless extrapolation of what he actually believes is not doing him any favors?