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<p>[QUOTE=&quot;Gam3rBlake, post: 8201563, member: 115909&quot;]Well it would only be unstable if there was no convertibility.</p><p><br /></p><p>If the paper money can be converted into gold coinage then there should be no instability.</p><p><br /></p><p>Think about it would you rather carry around 5 heavy coins (gold is very heavy) or would you rather have a lightweight bill? If the bill can be converted into coins at any time they both should be accepted as equal. I mean I’m sure you’d rather have a $20 bill than 2,000 pennies even though the intrinsic value of the copper in all those&nbsp; pennies is worth more than the value of the cotton paper of the $20 bill.</p><p><br /></p><p>In fact at this time President Grant had been wanting Americans to bring their war bonds to the bank and redeem them for gold coin because he believed that if the US government had the ability and people knew that paper money was redeemable for specie it would make the US Dollar a currency on par in strength with the European nations such as the French franc and Italian lira and such.</p><p><br /></p><p><br /></p><p>[ATTACH=full]1437247[/ATTACH]</p><p>[ATTACH=full]1437249[/ATTACH]</p><p><br /></p><p>Although it’s true the Pound Sterling was the monetary hegemony at the time. There are even stories of AMERICANS traveling overseas and bring with them British pounds instead of American dollars.</p><p><br /></p><p>£1 = ~$5 at the time which is pretty crazy when you realize a $20 gold Double Eagle was only worth £4.[/QUOTE]</p><p><br /></p>

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