Economics Questions

Re: There isn't enough gold in the world for us to go back to the gold standard...

pairunoyd — Thu, 29 Jan 2009 20:32:13 GMT

How can there be too little gold? Gold would simply have a higher price. It might take 1/1000000th of an ounce of gold to buy a house? Hows is that a problem? If there's gold in the bank, you can be issued a receipt for that gold. Receipts can be issued that represents all matter of fractions of gold. You could put an ounce of gold in there and issue a trillion receipts.

Re: There isn't enough gold in the world for us to go back to the gold standard...

AndrewKemendo — Thu, 29 Jan 2009 18:23:24 GMT

I just blogged about this fallacy yesterday:

http://andrewkemendo.blogspot.com/2009/01/gold-and-growth.html

Re: There isn't enough gold in the world for us to go back to the gold standard...

FreedomIsYellow — Thu, 29 Jan 2009 17:12:13 GMT

who would coin this gold or silver?

Private mints? Private banks? If there is demand for such a thing then there is room for entrepreneurs.

would it mean a complete abolishment of paper money, even in terms of transferrable certificates?

Not necessarily. It may well be convenient to have paper notes or digital money just as today, although provided by banks or institutions and backed by a commodity or combination of comodities. Who is to say? We can't imagine the innovations produced by the market because we as individuals don't have the imaginations of 6.5+ billion people.

Historically speaking, private mints have existed in countries, until demolished by government.

Re: There isn't enough gold in the world for us to go back to the gold standard...

Doubtus — Thu, 29 Jan 2009 16:56:33 GMT

who would coin this gold or silver? would it mean a complete abolishment of paper money, even in terms of transferrable certificates?

Re: There isn't enough gold in the world for us to go back to the gold standard...

FreedomIsYellow — Thu, 29 Jan 2009 16:13:39 GMT

can't the same thing be done to gold? the govt could just revalue gold or the exchange ratio and print as many dollars as they want...? right??"

Yes. Which is why most of us advocate not a "Gold Standard" per se - but a free market in money. Rather than having x amount of dollars representing x amount of gold, getting government OUT of the money business which it monopolises is the idea. Let the market choose the medium of exchange. Traditionally, markets have chosen gold (and silver) - probably due to the balance of scarcity, portability, longevity and subjective beauty, but other commodities might feature too.

Re: There isn't enough gold in the world for us to go back to the gold standard...

Doubtus — Thu, 29 Jan 2009 04:52:12 GMT

hello, sorry for bumping this old ass thread, wanted to clear things up.

one of the reasons why the gold std is advocated around here is because fiat money can just be printed as willed by the govt and inflated in its value.

can't the same thing be done to gold? the govt could just revalue gold or the exchange ratio and print as many dollars as they want...? right??

someone set me straight.

also, what is wrong with other metal, silver??? wasn't silver more used historically as a medium of exchange than gold?

Re: There isn't enough gold in the world for us to go back to the gold standard...

Lyle D. Riggs — Thu, 27 Nov 2008 05:12:36 GMT

The real issue about money is not whether it should be gold or not, but that it should be a commodity selected by the market that facilitates the transfer of goods and services with a lower transaction cost than direct (barter) exchange. Lots of different commodities have served as money through out history. The most recent and most common commodity historically has been gold. So, that is why today's economist most often speak of using gold. Take any of the arguments in favor of gold as money and any other commodity could be substituted as could the word specie, provided the market, i.e., not government, selects it and controls it. The argument is that specie money is better for an economy because the money supply cannot be arbitrarily inflated like fiat, paper money controlled by the government can.

While I do not think the argument that there is not enough gold is valid, it really does not matter because what it really desired is specie money not controlled by the government.

Re: There isn't enough gold in the world for us to go back to the gold standard...

Jon Irenicus — Thu, 27 Nov 2008 04:29:42 GMT

I mean no government management. Gold was was and is to this day selected in spite of government dictates.

Re: There isn't enough gold in the world for us to go back to the gold standard...

NewCreature — Thu, 27 Nov 2008 03:53:02 GMT

Jon Irenicus:

If consumers choose it, then yes, it is. Currently such a choice is strongly hindered by the government.

While I agree that the government is wholly in the hindering business, in an economy where currency exchanged would be a mere representation of the actual valuable asset, in this case gold, I don't understand where the consumer has say in the equation, unless of course you are talking about the possibility of competing currencies that are not government managed.

Can you clarify a bit?

NewCreature
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Re: There isn't enough gold in the world for us to go back to the gold standard...

Jon Irenicus — Thu, 27 Nov 2008 03:32:36 GMT

The reason I ask is that many on this list seem to be in favor of returning to the gold standard. In this modern age, is gold really the best thing on which to base our currency?

If consumers choose it, then yes, it is. Currently such a choice is strongly hindered by the government.

Re: There isn't enough gold in the world for us to go back to the gold standard...

duffmann808 — Thu, 27 Nov 2008 02:57:17 GMT

McDuffie for Congress:
I have heard this nonsense argument against the gold standard before. Apparently, the idea is that our economy is too large in terms of dollars to be backed by gold. How should I best address it this?

-If we were to go to a gold standard, we would need to get as much gold as money as we currently had in circulation. People who argue against a gold backed standard are afraid of change. They seem to prefer "hope" which as far as I am concerned means they dont "do".....which fits in perfectly with them not wanting anything to have to be done.

Re: There isn't enough gold in the world for us to go back to the gold standard...

liberty student — Thu, 27 Nov 2008 02:42:01 GMT

NewCreature:
I can see from your rating that you post A LOT. I hope all your comments aren't as useless as the last three. I simply asked a few on topic questions hoping to get some intelligent responses.

Some of them are even more useless. Would you like a refund?

Serious, your questions have been answered dozens of times already. Did you use the search, or do you expect people to repost the same things over and over again?

Re: There isn't enough gold in the world for us to go back to the gold standard...

NewCreature — Thu, 27 Nov 2008 02:37:26 GMT

liberty student:
Yes. It is the best. Ok?

I can see from your rating that you post A LOT. I hope all your comments aren't as useless as the last three. I simply asked a few on topic questions hoping to get some intelligent responses.

NewCreature
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Re: There isn't enough gold in the world for us to go back to the gold standard...

Marko — Thu, 27 Nov 2008 02:12:02 GMT

NewCreature:

I read somewhere that gold has indeed been made from lead in a nuclear reactor.

I think I heard the same somewhere. But the gold they got was highly radioactive or something.

Maybe it is just an urban legend. It has the wibe of it.

Re: There isn't enough gold in the world for us to go back to the gold standard...

liberty student — Thu, 27 Nov 2008 02:11:06 GMT

NewCreature:
The reason I ask is that many on this list seem to be in favor of returning to the gold standard. In this modern age, is gold really the best thing on which to base our currency?

Yes. It is the best. Ok?