Say Wha?

[Art Vandelay]

RE Gold Standard:- Wouldn't going back on the Gold Standard kinda wreck the US gov't? I mean, if it's harder for people to pay back debt under the Gold Standard...think about how much debt the US Government has. If the US Debt became denomianted in Gold wouldn't this make things worse for them than if it was denominated in their own currency(which, of course, they can print)?

The gold standard wouldn't replace US currency with actual gold, it would tie the value of all US dollars in existence to all the gold in Fort Knox. Basically it would mean $1 is good for a set quantity of gold and that quantity would change only at the discretion of the US government. The idea being that it'll tie the value of the US dollar to gold prices as well as the general state of the US economy, which would hopefully give it a bit of stability during a recession.

That said, it's a horrible fucking idea in practice.

[Distind]

RE Gold Standard:- Wouldn't going back on the Gold Standard kinda wreck the US gov't? I mean, if it's harder for people to pay back debt under the Gold Standard...think about how much debt the US Government has. If the US Debt became denomianted in Gold wouldn't this make things worse for them than if it was denominated in their own currency(which, of course, they can print)?

The gold standard wouldn't replace US currency with actual gold, it would tie the value of all US dollars in existence to all the gold in Fort Knox. Basically it would mean $1 is good for a set quantity of gold and that quantity would change only at the discretion of the US government. The idea being that it'll tie the value of the US dollar to gold prices as well as the general state of the US economy, which would hopefully give it a bit of stability during a recession.

That said, it's a horrible fucking idea in practice.

If I remember correctly it's not physically possible as there isn't enough known gold to back the current value of of the dollar. Even with the massively inflated prices lately. Unless of course we're going to massively devalue the dollar, or Ron Paul farts gold.

[myusername]

If I remember correctly it's not physically possible as there isn't enough known gold to back the current value of of the dollar. Even with the massively inflated prices lately. Unless of course we're going to massively devalue the dollar, or Ron Paul farts gold.

Ron Paul's supporters probably DO think he farts gold.

[Art Vandelay]

RE Gold Standard:- Wouldn't going back on the Gold Standard kinda wreck the US gov't? I mean, if it's harder for people to pay back debt under the Gold Standard...think about how much debt the US Government has. If the US Debt became denomianted in Gold wouldn't this make things worse for them than if it was denominated in their own currency(which, of course, they can print)?

The gold standard wouldn't replace US currency with actual gold, it would tie the value of all US dollars in existence to all the gold in Fort Knox. Basically it would mean $1 is good for a set quantity of gold and that quantity would change only at the discretion of the US government. The idea being that it'll tie the value of the US dollar to gold prices as well as the general state of the US economy, which would hopefully give it a bit of stability during a recession.

That said, it's a horrible fucking idea in practice.

If I remember correctly it's not physically possible as there isn't enough known gold to back the current value of of the dollar. Even with the massively inflated prices lately. Unless of course we're going to massively devalue the dollar, or Ron Paul farts gold.

Hence why it's a horrible fucking idea in practice.

[Distind]

Hence why it's a horrible fucking idea in practice.

I'm still lost on how gold is supposed to be better myself. Gold backed medium of exchange, or other medium of exchange. Both will be fucked at the same time, one hinders growth due to supply concerns. I'm reasonably sure the people who back it just have a hardon for shiny things.

[Art Vandelay]

Hence why it's a horrible fucking idea in practice.

I'm still lost on how gold is supposed to be better myself. Gold backed medium of exchange, or other medium of exchange. Both will be fucked at the same time, one hinders growth due to supply concerns. I'm reasonably sure the people who back it just have a hardon for shiny things.

I suppose some people think that gold is inherently valuable. It's why those Cash for Gold scams seem to work so well.

[myusername]

@ Distind: I *think* it's meant to be because Gold is a commodity "produced" by capitalists, and thus if you believe that "the market" solves everything, money should also be a commodity produced by the laws of supply and demand. On this view, the government printing money is essentially a form of "socialism" because the government is trying to control monetary supply from the centre, rather than leaving it up to the "market".

[DiscoBerry]

@ Distind: I *think* it's meant to be because Gold is a commodity "produced" by capitalists, and thus if you believe that "the market" solves everything, money should also be a commodity produced by the laws of supply and demand. On this view, the government printing money is essentially a form of "socialism" because the government is trying to control monetary supply from the centre, rather than leaving it up to the "market".

Then who controls the gold supply in the Libertarian Free Market paradise? 

[myusername]

@ Distind: I *think* it's meant to be because Gold is a commodity "produced" by capitalists, and thus if you believe that "the market" solves everything, money should also be a commodity produced by the laws of supply and demand. On this view, the government printing money is essentially a form of "socialism" because the government is trying to control monetary supply from the centre, rather than leaving it up to the "market".

Then who controls the gold supply in the Libertarian Free Market paradise?

No-one. That's basically their point. That no-one should control the gold supply (except the laws of supply and demand). Because controlling the money supply is interference in the "free market".

Also I think that Austrians think that printing money interferes with the "natural rate of interest" and causes economic crisis (gov't tried to push Interest Rates lower against the market). Thus the way to fix economic crises is to abolish the Fed & other centralbanks.

(Forgive me if I'm wrong, I make no claim to be an expert on economics, but I think that's right).

[DiscoBerry]

@ Distind: I *think* it's meant to be because Gold is a commodity "produced" by capitalists, and thus if you believe that "the market" solves everything, money should also be a commodity produced by the laws of supply and demand. On this view, the government printing money is essentially a form of "socialism" because the government is trying to control monetary supply from the centre, rather than leaving it up to the "market".

Then who controls the gold supply in the Libertarian Free Market paradise?

No-one. That's basically their point. That no-one should control the gold supply (except the laws of supply and demand). Because controlling the money supply is interference in the "free market".

Also I think that Austrians think that printing money interferes with the "natural rate of interest" and causes economic crisis (gov't tried to push Interest Rates lower against the market). Thus the way to fix economic crises is to abolish the Fed & other centralbanks.

(Forgive me if I'm wrong, I make no claim to be an expert on economics, but I think that's right).

I get that but if the GOv't isn't hoarding the gold and counting it, how much gold do you peg to each individual dollar?

[Distind]

I get that but if the GOv't isn't hoarding the gold and counting it, how much gold do you peg to each individual dollar?

Typically the material contained within the coin itself. The coinage business is a reason there was a rather huge fight over if gold or silver should be used. Paper currency is kinda the enemy of gold backed currencies, as it is mutable, as it's not always going to be redeemable for the same quantity of material if it's redeemable at all. So obviously we should all be carrying around large amounts of precious metals.

But since that doesn't work so well bank notes were developed, typically produced by the institution which held someone's stash of precious metals and could be redeemed for them at that bank. Which eventually became accepted as a government practice as well. Which might have worked well when digging shit out of the earth was a cutting edge profession. Not so much in an information age.

[Cataclysm]

Relevant:

<a href="http://www.youtube.com/watch?v=ELEwjVRxxGE" target="_blank">http://www.youtube.com/watch?v=ELEwjVRxxGE</a>

[Lt. Fred]

@ Distind: I *think* it's meant to be because Gold is a commodity "produced" by capitalists, and thus if you believe that "the market" solves everything, money should also be a commodity produced by the laws of supply and demand. On this view, the government printing money is essentially a form of "socialism" because the government is trying to control monetary supply from the centre, rather than leaving it up to the "market".

In fact, in practice the Gold Standard adheres far more to this definition off soshalysm. The value of a floating dollar largely reflects the market, consumer confidence, ect. A Gold Standard reflects what the government wants the value to be.

I see it as the single greatest self-contradiction in Austrian Bullshitnomics.

Edit to add: Of course, the other problem is that you always get deflation (cause of the shortfall of money chasing economic growth). Deflation is pretty much the worst thing that can happen.

[RavynousHunter]

I've heard people claim its because backing money with gold (or even making it OUT of fucking gold, hard to tell, at times) would somehow magically make our money non-fiat money.  Of course, this is bullshit, because all money, no matter what its made out of or what backs it, is fiat money: its value is only what a person believes its worth.  For example, I likely view a single dollar as far more important than Bill Gates does, ergo, it has more intrinsic worth to me than it does him.

If these retards would stop and think for a moment, they'd realize that the only "libertarian" way of trade would be a return to the barter system, where people trade only for what they need and/or want, anything could effectively be currency, and establishing standards would be a nightmare for anything beyond a local scope.

Basically, they don't really understand why humans invented currency in the first place.

[ironbite]

...fuck it lets got to caps and be done with it.