Bernanke Against Gold

Gary North is a blithering idiot.

That is a lot of hatefulness showing its head. It is a quick step from finding the "culprits", to electing the fascists, or the communists. This all sounds like something Putin would write for a campaign speech.

Sound like typical demented ramblings. Do you have any original thoughts or do they all come teletyped in from Gary North?


Amanda

 

Log in or Sign up to hide this ad.

Horsefeathers!

Obviously some people have a lot at stake and want to characterize as "hatefullness" thoroughly documented facts. If we knew what your particular biases were we could ascertain whether your opinions are the products of classical economics or of the modern versions of which Blythe Masters and JP Morgan are typical. I have noticed when big coin shows are held in parts of the country full of hedge funds and fiat money they generally don't do too well there. Example: "Coinfest".

 

Hello

Your naive vindictiveness fails the crucial logic test. We all benefit from Wall Street in an enormous fashion. In fact, most of us are directly invested.

Amanda

 

Take your politics of hatred to another forum.

Amanda

 

Obviously not old enough to recall McCarthy or the Korean War. edited - further comments like this will result in infractions being given

Amanda

 

Hopefully the moderators have noticed your vile and disgusting attacks and will follow through with their rules against slander.

 

Kettle...Black

 

You could be nicer about it. There are two Wall Streets. One raises capital for new businesses and business expansion, provides liquid markets for investors to buy and sell, and has greatly benefited the nation and the world. The other is a casino operated by creatures lurking in dark corners with black boxes that suck capital out of the system by methods only dimly understood by regulators and only one step ahead of the law. Whenever I hear or read someone talking about Wall St being good or bad without specifying which one, I know they either don't really understand the situation or are intentionally attempting to deceive.

 

There is one Wall Street. There are 2 Seventh Avenues, and two Times Squares, and ONE Harry at Hanovers.

 

The context is finance, not geography. But I assume you know this and therefore know your prior posts are wrong.

 

The Soviet Union analogy is always used by people that don't have an answer.
The gold standard worked when the price of gold was fixed at $35 per oz. There was inflation, but there were no wild price swings. If the price of gold is allowed to float, one minute your loaf of bread will be $2.00, in the next minute it might be $1.95. In another 5 minutes it might be $2.35.

 

People, stay away from politics that doesn't DIRECTLY concern the topic Bernarke and Gold. There are no Documented FACTS in any of these slanted posts, just documented opinions. If you wish to hope and believe, rather than discuss with an open mind on the subject, find a political forum. And play nice!

 

The price of gold was, in fact, at one time fixed by US law, so price fixing in the USSR is not relevant to my question.

Let me make my question simpler.

If the dollar is backed by gold, and the price of gold is not fixed, but allowed to fluctuate, does it not make sense, then, that the value of the dollar will continuously and constantly fluctuate, thereby making the price of consumer goods constantly fluctuate?

 

The dollar fluctuates now. What if we pegged it to oil prices and said $100 dollars equals 1 barrel. There would be stability for a time, but if supply and demand pushed up the world price, the US would have a shortage. If new discoveries increased supply above demand, everyone would send their oil to the US because we would be overpaying. The same would happen with gold, or any commodity backing the currency.

Whether you are talking about price fixing consumer prices, or oil, or interest rates, or currency conversion rates, or even gold history has shown that price fixing doesn't work. When the gold price was fixed by law in the US, that didn't work either. It will work for a time for sure. But imbalances build up in the system. The imbalances in the 1920s and early 30's led to the deflation during the Great Depression. The imbalances under Bretton Woods led to the serious dollar inflation of the 1970s. If the dollar is backed by gold, it will happen again.

Edit: Go back and reread C Jay's fine post #19 where he gives a good example of this and ends with the appropriate question - do you really want to go there?

 

Really, is having gold backed money any better than what we have now? Governments will have more than mere faith to manipulate in their favor. Banks will still control the flow of it, no matter how much of it somethink the public ownes, which is peanuts. And Wall Street will still be Wall Street. I don't see it changing a thing.
Guy

 

Absolutely, positively! I don't know why some people are on the jump on Bernanke train, it really doesn't mean diddley. It wouldn't matter one way or the other how he feels about gold. Do some people really think that if Bernanke supported the gold standard then we would go back to using gold coins in day to day business?

 

This paragraph is taken completely out of context. It completely misses the point of why the the banks had to do this in the first place. It leaves out the part where speculation caused by central bank created money caused first the stock market boom in the 1920s and then subsequent crash of the entire financial system as a result. People figured out quickly what "promises" made on paper really mean. This is why banksters, wall streeters and ordinary people were jumping out of windows to their death. This had not happened in the USA before and it was all at the hands of fiat money from the Fed.

The article where that paragraph came from also makes note of the long period of prosperity, economic stability and huge economic expansion of the economy prior to the creation of the Federal Reserve in 1914 while the nation was on the gold standard.

So a huge boom then subsequent bust was created by fiat money but it was fiat money that could, at the time, still be redeemed for gold because Federal Reserve Notes exchanged $ for $ with the rest of USD including gold $ certificates. As a result of this nonsense, banks were forced to take extreme measures during this time which is where the above paragraph comes from. This was settled simply by the government seizing all the people's gold and forcing them to only use fiat. So of course anyone who doesn't know this history, including those who "liked" the post I'm responding to, think the gold standard is bad. It's a case of seeing what you want to see.

And if anyone questions this, I will also point out this summary, including that of what he called the classic gold standard period, came from none other than Ben Bernanke himself before he was the head of the Federal Reserve. He sings a different tune now, but at the time he said this, he had no idea that he would be the head of the Fed one day.

 

Look what former FED chairman Alan Greenspan wrote many years ago: http://www.dailypaul.com/112046/alan-greenspan-1967-gold-economic-freedom

 

The paragraph could not be taken out of context, the context is this thread and the words are my own. What I stated is from what I have read and researched from numerous sources. It is my understanding that the gold standard was in place all through the 20's and 30's and as a result restricted the money supply. I believe the practical end came with the Benton Woods Accord in 1944. I do not have a hard source for the exact date and am open to whatever may have proceeded it. The creation of the Federal Reserve did not end the gold standard. Congress still creates the money, federal employees print it, the FED manages it.

Please link me to the article referred to in your first and second paragraph, I may inadvertently owe someone royalties.