Will there always be privately owned GOLD???

Another possible scenario is if money went completely paperless/digital, with requirements in place for those who want to continue doing commerce. If PM's became the de facto workaround that might be motivation to make them illegal. I'm not worried about mass confiscation, but I wouldn't feel warm and fuzzy about safety deposit boxes or ETF's either.

 

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So I guess I should start building my fortress now , stock up ammunition and rations . Join a survivalist group and go live in the mountains . I think
I'll go on living as I have . I will not let doomsday prophesies make me live in fear . If something catostophic happens , which is very unlikely I'll deal with it as it comes .
Rusty

 

Well that's not what I said, but it surely couldn't hurt. Millions of people die every year, not from the natural and manmade disasters which ultimately seal their fate, but their attitudes essentially the same as yours which kept them from implementing simple measures which would greatly improve their chances for survival. It's funny that you're not scared being completely unprepared for anything. That's not bravery, but denial. I'm quite content knowing that I'm prepared for many potential circumstances and don't know how I could sleep if I had no idea how to handle anything which comes down the pike. I do what I can to educate people how very simple steps can protect them, but inevitably there are many like you who prefer to be victims than even consider the likelihood of what's right in front of them. I guess that would be too scary.

 

I don't plan on moving out of the area I've lived in my entire life, or joining any groups with people in it that haven't earned my trust. If a catastrophe does happen, those who stocked up on supplies before the mad dash will be glad they did. I follow the Boy Scout Motto of Always Be Prepared. Personally I have invested in PM's, firearms/ammo, home, garden, survival supplies, body/mind/self, and relationships with honest people. I do this not out of fear, but out of risk mitigation and positional advantage. It doesn't impact my ability to live a happy life more than anyone who doesn't do these things.

 

I concur. I'm exactly the same way. But that preparation forces me to consider the scenario where I'm forced to leave. Surely lots of people within 40km of Fukushima didn't plan on ever leaving their homes, or those who lived in New Orleans, or Jews in 1930s Germany, etc. But sometimes circumstances beyond your control force you to do things you don't want to. So while I have made my home in a place I will not likely ever have to leave, even if the worst comes to pass for our country, I have nonetheless opened a bullion account in Zurich and stashed a few ounces. Just in case. It's cheap insurance.

And actually, I think that my ability to live a happy life is enhanced by my preparations more than anyone who doesn't do these things. No matter how much one buries his head in the sand, I have to believe he worries a little bit about his butt sticking out. I don't have to worry because I keep my head up and anticipate what I see coming.

 

He wasn't suggesting putting a fractioal amount of gold in the coinage he was talking about fractional reserves, having say $1 in actual physicl gold backing for every $100 in printed paper money. We had that form of fractional reserve up untill I believe 1968. There was 25 cents in gold backing for every federal reserve note. US citizens could not redeem the notes for gold but foreign governments could. In March of 68 that last remaining reserve was stripped away.

This is something that most people don't realize, gold backing for the dollar does not have to mean $1 in gold for every $1 in paper. Until 68 is was $0.25 and it did provide some stability to the dollar. Even at $0.01 it would provide more stability than $0.00.

 

Good post. Thanks for explaining that better!

 

Thank you …. Right on ... Rope

 

I agree. The same could be said of coins. The Mint could turn out coins with the same specifications as a morgan or peace dollar, but make it a $100 coin.

And people should keep in mind that having a gold-backed currency is completely different from making gold money unless it is freely convertible.

 

But they will still will have to have some gold, no more mindless printing.......

 

Maybe I an too cynical, but mostly I feel people want gold backing the monetary system so they can demand exchange in gold, rather than saying something about the strength of the money. Exactly how many current monetary systems back their functionional money unit with gold or silver? I know of none. And the question, how will it benefit the US in the world economy ?

Jim

 

I believe that under one or more of the regulations of the IMF or World Bank, member countries are rohibited from backing their currency with anything. However, central banks are permitted to own gold as part of their reserves.

 

If member banks of the central bank bring cash, can they exchange it for gold, or is it a "reserve" that is for accounting/stability use within the banking system only? I am very convinced the days of exchanging cash at a bank of any level and receiving any quantity of gold or silver in exchange will never reoccur in any country. IMO.

Jim

 

My understanding [which may be wrong] is that central banks can choose to hold gold the same way they might own US Treasuries or Yen or Euros as "backing" for the fiat currency they issue. They can trade any of these things among themselves for reasons that only the central banks probably understand. I believe that all of this "stuff" is the asset side of their balance sheet, and the fiat currency they issue is the liability side. So my use of the word "reserve" was probably wrong.

 

Sure taking precautions is a prudent thing to do . I own a couple firearms
own silver and some gold . Have a strong family and comunity presence .
It just sounded to me that many people were going overboard . If a catastrophe happens , how are you going to get to Zurich and what makes you think it will be better there . Taking precautions are fine as long as it doesn't interfere with your familys' happiness and long term finances .
Rusty

 

How can you even know what I'm prepared for or not , It seams you took my post as not joining survivalist groups , and fleeing the country as having my head in the sand . I can shoot a rifle or handgun as good as or better than 90% of the people in this country . I happen to live in an area where home invasions , burglaries , and an occasional murder happen every year . Prudent measures fine , measures where needed money to send your kids to school and your families well being are not . Also please tell me in any Western nation millions of people have died for lack of taking precautions .
Rusty

 

Gold/Silver backing not exchange, furthermore since when has the USA needed an example to do what’s needed, a leader by definition can’t follow. How will it help? Our dollar will become stronger, just as strong and flexible as you wish, depending on its backing at any given time.
Many bugs would have to be worked out, but in theory it could work.

 

Gold backing, even partially, inhibits the central bank's ability to print it without limit. E.g. we just learned that the Fed printed over $3 trillion in 2008. The benefit is no more bubble/crash cycles, a government forced to live within its means, the ability to plan more than a few years ahead, to make contracts and purchases with timespans over a decade, to save for retirement, etc.

You can currently deposit and withdraw gold out of any bank in China. I'm not sure about banks in India, but I know gold is used in trade in India as well. So right there is like half the world's population. But direct exchange of gold itself isn't even necessary if the currency is merely backed by gold, like it was prior to 1933, and partially prior to 1971 here in the U.S. You didn't need to actually trade in physical gold because the paper currency was a "warehouse receipt" for gold held in the Treasury.

I merely responded to your posts. If you meant to imply something else, you should have said so. I have no idea about your personal situation, I'm not talking about you, I'm talking about the need to prepare in general. You argued against it and I responded.

Here's some data compiled about worldwide deathtolls:
http://donsnotes.com/hist/disasters-war.html

By all means, do some more research on your own. Obviously, tens of thousands just died in Japan, among the most advanced and well-prepared societies on the planet. And the death toll may climb substantially depending on what happens with the nuclear meltdown.

One of the important things to note is that 100+ year events have, by definition, not happened in recent history, so don't only look back 20-30 years and expect to have counted all your risks. Hyperinflations, genocides, massive storms, civil wars, magnitude-9 earthquakes (like in Japan), etc., only happen very rarely. But when they do, people mostly die due to normalcy bias. They just aren't prepared. Doesn't matter if you're a poor peasant in Africa or the owner of a penthouse in NYC. Everyone is just as vulnerable to these kinds of risks.

 

Regarding 1, partial banking doesn't inhibit anything. If the currency can be backed by gold or US Treasuries or other assets, as is currently the case, there is no limit. A limit only comes about if there is a fixed ratio.

Regarding 2, my understanding [which may be incorrect], is that the bank will store the gold for people, but there is no fixed amount of gold backing the currency.

 

There isn't any good reason for the US to hold tons of gold in Fort Knox. It's insufficient to use as backing for the currency. Even at today's high value, it's worth about $200 billion. The sensible thing to do would be to sell it, and use the proceeds for something worthwhile, like shoring up Social Security.

Of course, that won't happen for a variety of reasons. It would infuriate people with an interest in high gold prices. It would infuriate the guys with gun-nut sideburns and big belt buckles, who will see it as a TrilateralIlluminatiFreemasonSorosCommie plot. It would have disproportionate negative psychological effects on normal people in general, to whom it will be portrayed as the prelude to the final bankruptcy of the government (selling our seed corn, etc.).

Just as there's no good reason for the government to be clinging to a mountain of useless yellow metal, there's no good reason for it to try to acquire more, by means fair or foul.