Re: +21000 on the Dow
Posted: Thu 27 Apr 2017, 19:07:43
vtsnowedin wrote:You and I would never know how much gold was actually in the vaults or if it was real or gold plated lead bricks.
I don't think you can peg a currency to one rare substance. It has to be a composite of all the useful things in the GDP of a country. A dollar is worth exactly what you can buy from a willing seller for a dollar. $49 / barrel oil. $30K automobiles, A root canal and crown for $800, $3.50/lb hamburger. etc.etc.
Sorry, but completely wrong IMO.
First, there are audits. Aside from the conspiracy theory rhetoric, why shouldn't objective periodic audits, done by multiple groups if needed, not count/verify the gold bars? (You can weigh the bars. You can use density testing. The idea that you couldn't tell doesn't wash. I prefer to use gold bullion coins to avoid the cost and delay of requiring assay, for example, but they could make US Eagles from the bars if bars concern you.
Since when is the piece of paper or the electronic blip that is a dollar representative of much of ANYTHING, much less of "all the useful things of the GDP of a country?" Is Australia's dollar more representative of natural resources than the US dollar? I don't think so.
As long as the public can have confidence in a currency and will ACCEPT it in exchange for goods and services, it will serve just fine. With currency in the US being something like 99%+ electronic blips instead of paper (per a quick Google search), we could use Beanie Babies as currency IF you could get the public to have consistent long term confidence in them.
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The objection to using Gold as a currency from liberals I've heard is that an economy MUST have inflation to work. Liberals supporting the government depreciating everyone's money as a matter of course -- why am I not surprised? At least that has more logic to it than a currency must be object X instead of object Y.