Professor Bernanke rails against gold standard

[bluesc]

Federal Reserve Chairman Ben Bernanke headed back to the classroom Tuesday, and defended the Fed against its most outspoken critic, Ron Paul.

In a lecture otherwise about Fed history and the Great Depression, Bernanke devoted four slides to discussing "problems of the gold standard."

For years, Congressman (and now presidential candidate) Ron Paul has argued to abolish the Fed and revert back to a system where U.S. dollars can be redeemed for gold.

Read more: http://economy.money.cnn.com/2012/03...d-6/?iid=HP_LN

[jkr]

but is gold money?

[JorgeStevenson]

Wait...he really used the "there's not enough gold to go back to the gold standard" argument?

[AngryCanadian]

Ron Paul needs to Spank Ben Again!

http://blogs.marketwatch.com/electio...ssor-bernanke/

Under gold standard, a central bank has no flexibility to lower rates in recession and raise them during periods of inflation, Fed chief says

[thequietkid10]

Ron Paul needs to Spank Ben Again!

http://blogs.marketwatch.com/electio...ssor-bernanke/

Which of course begs to question...why does the fed need to do this?

[AngryCanadian]

Wait...he really used the "there's not enough gold to go back to the gold standard" argument?

Yes thats what he used.

[Bern]

The fact that he mentioned it shows that the Fed is getting very nervous about their political support. This is a good thing IMO. HR 1098 holla!

[xFiFtyOnE]

I'm not very good with monetary and economics and all that but wouldn't a simple solution to the "not enough gold for a gold standard" problem be to change the amount of dollars tied to an ounce of gold? Say instead of a $20 gold coin like back in the day, they made the same size coin but worth $1000 face value or more for example?

[jkr]

gold is useful at a nano scale...HOW is there not enough gold?

[rockerrockstar]

The biggest problem I can see with returning to the gold standard would be other countries trading their fiat money for our gold. Second is how would you have something like FDIC insurance on your bank account? Third we need laws to protect people from getting their gold taken by the government otherwise history could repeat.

The Government likes to go off of gold currency to help fund wars via printing money or electronically printing money. That is one reason Ron would have such a hard time getting them to change their ways. Another reason they would not want to do it is that there would be a power shit to countries that have gold. I also wonder if we have enough gold to support gold as a standard since the population of the world is so large now.