Time to Return to the Gold Standard?

Discussion of the Gold portion of the Permanent Portfolio

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technovelist
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Re: Time to Return to the Gold Standard?

Post by technovelist » Sun May 05, 2019 8:02 pm

Kbg wrote:
Sun May 05, 2019 7:50 pm
Tn,

With respect, you are just flat wrong on several points concerning paper money. Financial crises were far more frequent in earlier times and usually more severe on average. Additionally, very few economic crises have anything to do with money per se. They are almost always caused by something more fundamental and real.

Be careful where you get your info on gold and money, inevitably (surprise) the stuff you were spouting sounds like it comes from people who sell gold...

Riddle me this: Why doesn’t anyone use the gold standard anymore? Conspiracy theories not allowed. Actual historical facts and contemporary statements required.
The reason that no government uses the gold standard is that it prevents them from stealing people's wealth by stealth.

That is not a conspiracy theory, but a fact.

However, I don't debate with people who use such tactics, so you are blocked.
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Re: Time to Return to the Gold Standard?

Post by Hal » Mon May 06, 2019 12:50 am

Kbg wrote:
Sun May 05, 2019 7:50 pm
Tn,

With respect, you are just flat wrong on several points concerning paper money. Financial crises were far more frequent in earlier times and usually more severe on average. Additionally, very few economic crises have anything to do with money per se. They are almost always caused by something more fundamental and real.

Be careful where you get your info on gold and money, inevitably (surprise) the stuff you were spouting sounds like it comes from people who sell gold...

Riddle me this: Why doesn’t anyone use the gold standard anymore? Conspiracy theories not allowed. Actual historical facts and contemporary statements required.
For the answer of a metallic standard vs fiat currency, have a read from pg 75 where the title is: "A greenbacker".

https://archive.org/details/coinsfinanc ... ial+school

The book was written back in the 1890's, so it was in the Gold Standard days.

<edit: title>
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Kbg
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Re: Time to Return to the Gold Standard?

Post by Kbg » Thu May 09, 2019 12:10 pm

technovelist wrote:
Sun May 05, 2019 8:02 pm
Kbg wrote:
Sun May 05, 2019 7:50 pm
Tn,

With respect, you are just flat wrong on several points concerning paper money. Financial crises were far more frequent in earlier times and usually more severe on average. Additionally, very few economic crises have anything to do with money per se. They are almost always caused by something more fundamental and real.

Be careful where you get your info on gold and money, inevitably (surprise) the stuff you were spouting sounds like it comes from people who sell gold...

Riddle me this: Why doesn’t anyone use the gold standard anymore? Conspiracy theories not allowed. Actual historical facts and contemporary statements required.
The reason that no government uses the gold standard is that it prevents them from stealing people's wealth by stealth.

That is not a conspiracy theory, but a fact.

However, I don't debate with people who use such tactics, so you are blocked.
Tn,

How is it stolen and to whom do the benefits and costs go from inflation?

Am I stealing from the bank that decided to give me a 30 year fixed rate loan? Am I benefiting from it now or still getting my clock cleaned?

But if you are going to assert inflation is always a detriment, pray tell why is a deflationary hard currency crisis a good thing and how am I benefitted by one more than low grade inflation.

Or do you prefer an ostrich approach to life?

I hold gold as a part of a diversified portfolio, but the vast amount of information you get fed from the gold coinage industry is pure crap and does not survive an unbiased analysis of which there are many both as a financial asset and an historical monetary basis instrument.

Fact: In the modern world money is money because an internationally recognized government says it is.

Test question: What do we quote the value of gold in? Last time I checked I haven’t been able to find a quote for 17.5 lbs of green colored paper with dead US presidents on it per 1oz of gold metal.

Second test question: If you are running a gold bullion selling/ storage business, why in the world would you accept a list of 1s and 0s over the internet and send actual real gold to someone? It seems the height of foley to me.
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Re: Time to Return to the Gold Standard?

Post by boglerdude » Thu May 09, 2019 10:08 pm

Goldbugs/libertarians dont do nuance. They are always good, and government's always bad.

But to steelman, I went to good schools and no one ever explained the inflation tax. Mostly the fault of my parents, but still

edit: Free market money might be ideal, if everyone were rational...
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Re: Time to Return to the Gold Standard?

Post by gaddyslapper007 » Mon May 13, 2019 3:28 pm

Kbg wrote:
Thu May 09, 2019 12:10 pm

Tn,

How is it stolen and to whom do the benefits and costs go from inflation? ANSWER: Inflation steals from savers.....it discourages saving as the dollar becomes worth less over time....therefore encouraging spending, investing & debt....therefore "benefiting" the economy and punishing savers.

Am I stealing from the bank that decided to give me a 30 year fixed rate loan? ANSWER: not if you agreed to it. Am I benefiting from it now or still getting my clock cleaned?....ANSWER: Is your loan interest amortization denominated in an inflationary based currency (ex. US dollar) and economy? If yes, you and lender both win. Is your loan interest amortization denominated in an deflationary based currency (ex. BTC) in a inflationary based economy? If yes, this would be terrible to borrowers and great for lenders & savers.

But if you are going to assert inflation is always a detriment, pray tell why is a deflationary hard currency crisis a good thing and how am I benefitted by one more than low grade inflation. ANSWER: Inflation is not always bad....its great holding debt in an inflationary currency and economy. A deflationary currency encourages / rewards saving, discourages debt / borrowing....the perfect currency to hold if you live in an inflationary based economy.


Fact: In the modern world money is money because an internationally recognized government says it is. Correct-ish, however there are alternatives outside of government issued money......ultimately people give money / currency value.

Test question: What do we quote the value of gold in? Last time I checked I haven’t been able to find a quote for 17.5 lbs of green colored paper with dead US presidents on it per 1oz of gold metal. ANSWER: US dollar. as it is the most widely used currency by people....due to its perceived stable value amongst people.

Second test question: If you are running a gold bullion selling/ storage business, why in the world would you accept a list of 1s and 0s over the internet and send actual real gold to someone? It seems the height of foley to me. ANSWER: Ease of acceptance. If US dollar denominated and you reside in US.... taxes and paying vendors make it more desirable…..i.e. paying other people.



Bottom line.... Accept that we live in an inflationary currency based economy. (US dollar) This will not change anytime soon....therefore exploit it's weaknesses and utilize its attributes for your own benefit.
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Re: Time to Return to the Gold Standard?

Post by Kbg » Tue May 14, 2019 9:10 am

gaddyslapper007 wrote:
Mon May 13, 2019 3:28 pm
Kbg wrote:
Thu May 09, 2019 12:10 pm

Tn,

How is it stolen and to whom do the benefits and costs go from inflation? ANSWER: Inflation steals from savers.....it discourages saving as the dollar becomes worth less over time....therefore encouraging spending, investing & debt....therefore "benefiting" the economy and punishing savers.

Am I stealing from the bank that decided to give me a 30 year fixed rate loan? ANSWER: not if you agreed to it. Am I benefiting from it now or still getting my clock cleaned?....ANSWER: Is your loan interest amortization denominated in an inflationary based currency (ex. US dollar) and economy? If yes, you and lender both win. Is your loan interest amortization denominated in an deflationary based currency (ex. BTC) in a inflationary based economy? If yes, this would be terrible to borrowers and great for lenders & savers.

But if you are going to assert inflation is always a detriment, pray tell why is a deflationary hard currency crisis a good thing and how am I benefitted by one more than low grade inflation. ANSWER: Inflation is not always bad....its great holding debt in an inflationary currency and economy. A deflationary currency encourages / rewards saving, discourages debt / borrowing....the perfect currency to hold if you live in an inflationary based economy.


Fact: In the modern world money is money because an internationally recognized government says it is. Correct-ish, however there are alternatives outside of government issued money......ultimately people give money / currency value.

Test question: What do we quote the value of gold in? Last time I checked I haven’t been able to find a quote for 17.5 lbs of green colored paper with dead US presidents on it per 1oz of gold metal. ANSWER: US dollar. as it is the most widely used currency by people....due to its perceived stable value amongst people.

Second test question: If you are running a gold bullion selling/ storage business, why in the world would you accept a list of 1s and 0s over the internet and send actual real gold to someone? It seems the height of foley to me. ANSWER: Ease of acceptance. If US dollar denominated and you reside in US.... taxes and paying vendors make it more desirable…..i.e. paying other people.



Bottom line.... Accept that we live in an inflationary currency based economy. (US dollar) This will not change anytime soon....therefore exploit it's weaknesses and utilize its attributes for your own benefit.


1. Wrong. That's why we have "real" interest rates. Without real interest rates no one in their right mind would save anything. And this does not change in a fixed monetary system.

2. Why did you duck answering the hardest question I put to you? Read up on on the 1930s and provide the answer. The burden for his one is on you if you are going to assert it, defend it.

3. Wow, seriously? John Maynard Keynes...Paradox of Thrift. OK, I'm going to answer the question you failed to just above. The paradox of thrift is an actual documented and studied phenomena and when it gets started it drives people into becoming ever more impoverished with an economy that continues to contract as money gets hoarded. You probably hate the welfare state as well. Guess what, this is exactly why we have a welfare state in the US now. (Let that one sink in for a bit...it's 100% true.) Rational people will do nothing BUT save as anything else is irrational. And ta da...that's why no responsible central bank or country implements a fixed base currency. Even Bitcoin's inventors recognized this and that's why it's "mined" so that it can grow. Simply put, you have two devils to chose from. Fixed base or fiat monetary systems. The later is generally recognized in the mainstream as the greater devil. Oh by the way, there is a ton of historical examples of metal based monetary system devaluation. All the government has to do is say: Our new gold money piece is now 25% lead vs. 2%.

4. You got me there...there is a .005% fringe I could barter or do some other alternative monetary system with. However, my friend, you still fail the Walmart test. My credit card does not. For everyday life, I chose the 99.995% usability path.

5. Good to know we agree on something. :-)

6. Ditto #5

(Sorry I have no idea why this is all bold)
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Re: Time to Return to the Gold Standard?

Post by gaddyslapper007 » Tue May 14, 2019 11:47 am

Kbg wrote:
Tue May 14, 2019 9:10 am

1. Wrong. That's why we have "real" interest rates. Without real interest rates no one in their right mind would save anything. And this does not change in a fixed monetary system.

2. Why did you duck answering the hardest question I put to you? Read up on on the 1930s and provide the answer. The burden for his one is on you if you are going to assert it, defend it.

3. Wow, seriously? John Maynard Keynes...Paradox of Thrift. OK, I'm going to answer the question you failed to just above. The paradox of thrift is an actual documented and studied phenomena and when it gets started it drives people into becoming ever more impoverished with an economy that continues to contract as money gets hoarded. You probably hate the welfare state as well. Guess what, this is exactly why we have a welfare state in the US now. (Let that one sink in for a bit...it's 100% true.) Rational people will do nothing BUT save as anything else is irrational. And ta da...that's why no responsible central bank or country implements a fixed base currency. Even Bitcoin's inventors recognized this and that's why it's "mined" so that it can grow. Simply put, you have two devils to chose from. Fixed base or fiat monetary systems. The later is generally recognized in the mainstream as the greater devil. Oh by the way, there is a ton of historical examples of metal based monetary system devaluation. All the government has to do is say: Our new gold money piece is now 25% lead vs. 2%.

4. You got me there...there is a .005% fringe I could barter or do some other alternative monetary system with. However, my friend, you still fail the Walmart test. My credit card does not. For everyday life, I chose the 99.995% usability path.

5. Good to know we agree on something. :-)

6. Ditto #5

(Sorry I have no idea why this is all bold)

1. Sorry I do not understand your answer...please provide your answer to your question if you would please.....trying to understand your point. Are you saying real interest rates negate my answer? (or are the solution)?

2. no defense here.....(FYI....I hate gold (physical / non divisible properties)....but hold it like you) My simplistic answer /understanding is it was not one (1) thing....but a culmination of several stacked irresponsible behaviors / practices of lenders / banks and government mingling.

3. We wont agree here...thats fine. I lean toward Austrian Economics. To me it seems VERY unreasonable, delusional to believe that a person or group of people (government) can "control" an economy within target boundaries based upon millions of individuals.... Yes Bitcoin is inflationary (for now) until the year ~2140.....at which point all coins will be mined. Its inflation schedule halves every 4 years until then. Once again.....bad actors were the causes of many currency collapses….that's the point! Corruption will find its way into anything if given human influence / control.

4. you don't get to dictate where I spend my money....you force me to go to Walmart? Why cant I shop at pawn shops / jewelers with gold (I wont by the way), or Whole Foods, starbucks, whoever else with BTC? FYI.....I choose ease of use as well....the point is....we are moving toward a muti-currency world whether you like it or not. The dollar has been losing its world reserve status well over a decade.
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Re: Time to Return to the Gold Standard?

Post by Kbg » Tue May 14, 2019 4:31 pm

1. I'm saying inflation does not of itself discourage savers unless a positive real rate of return is not achievable. No doubt negative real rates do happen from time to time and that does tend to discourage saving (or so we thought...but now we have negative yielding sovereign bonds.)

2. "Responsible" central banking in today's world generally means low inflation with jobs. Not too hot, not too cold.

3. Explain to me why gold fixes human corruption? I'm guessing about the same time humans figured out this invention called money another set were figuring out how to manipulate it.

4. I'm not dictating what you do in any way shape or form. I'm just pointing out physical gold is not usable at Walmart to purchase what is on their shelves because they won't take it. This is a metaphor that means physical gold is not legal tender in the U.S. and other than pawn shops and gold dealers you can't do anything with it as compared to what actually is money. For people living in the United States it is almost irrelevant that we are going to a multi-currency world. We've been living in one for several hundred years. If you live in the US you A) better have some US coins/bills or B) an electronic account that is in US dollars or will convert to them on your demand to US accepted 1s and 0s.

But I think you are missing my main point which is: Money in the modern world is what a government decides is money for the piece of turf on this earth they control. What gold fans refuse to recognize is that in reality it has always been this way and that gold can be debased by a government almost as easily as can paper money. Pretty much the only times this is not the case is when the government has lost control of its populace.

If it has lost control well who knows what will be "money" and gold/silver is probably a good first guess to posture for if you are so inclined.
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Re: Time to Return to the Gold Standard?

Post by boglerdude » Tue May 14, 2019 8:49 pm

It might be simpler to forget gold/bitcoin, and first wonder what would happen if the Fed disabled their (digital) printing press
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Re: Time to Return to the Gold Standard?

Post by gaddyslapper007 » Wed May 15, 2019 8:30 am

boglerdude wrote:
Tue May 14, 2019 8:49 pm
It might be simpler to forget gold/bitcoin, and first wonder what would happen if the Fed disabled their (digital) printing press
Good idea... thought experiment!.....Rules
1. so gold / bitcoin never existed before as currency nor will they.
2. US government made mandatory tax payments be collected in US dollars or else people (government employees) with guns come to take your freedom. <-- this greatly encourages people to adopt a government currency as their freedom is at stake....so it therefore has a perceived value!
3. Once US dollar has established adoption / acceptance ~100years?? or so the Fed shuts down.
4. Now we have fixed money supply. What does the economy do going forward? Short term (1-10 years) 2. Mid term: (10-50 years) 3. Long Term (50+ years)


My thoughts....Short term economy S**t's itself as dollars are now harder to get and our economy is addicted to debt. The contraction of "money" supply lost would be unfathomable. (as most money in circulation is lent into existence) - Mid term - day-to day life has settled...prices have reset to accommodate current economy / market conditions. Long term - Removing any other human / government interference the free market goes through its natural cycles. good or bad. <-- this is where ethical / humane values /beliefs difference in opinions come into play...not an easy subject / solution....
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Re: Time to Return to the Gold Standard?

Post by Kbg » Wed May 15, 2019 8:37 am

boglerdude wrote:
Tue May 14, 2019 8:49 pm
It might be simpler to forget gold/bitcoin, and first wonder what would happen if the Fed disabled their (digital) printing press
Indeed. I've mentioned this elsewhere but I think it would be interesting to fast forward 50-100 years to see what becomes standard monetary theory. The former theory is not fitting reality very well post GFC and I think will eventually be overturned
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Re: Time to Return to the Gold Standard?

Post by gaddyslapper007 » Wed May 15, 2019 8:55 am

Kbg wrote:
Tue May 14, 2019 4:31 pm
1. I'm saying inflation does not of itself discourage savers unless a positive real rate of return is not achievable. No doubt negative real rates do happen from time to time and that does tend to discourage saving (or so we thought...but now we have negative yielding sovereign bonds.)

2. "Responsible" central banking in today's world generally means low inflation with jobs. Not too hot, not too cold.

3. Explain to me why gold fixes human corruption? I'm guessing about the same time humans figured out this invention called money another set were figuring out how to manipulate it.

4. I'm not dictating what you do in any way shape or form. I'm just pointing out physical gold is not usable at Walmart to purchase what is on their shelves because they won't take it. This is a metaphor that means physical gold is not legal tender in the U.S. and other than pawn shops and gold dealers you can't do anything with it as compared to what actually is money. For people living in the United States it is almost irrelevant that we are going to a multi-currency world. We've been living in one for several hundred years. If you live in the US you A) better have some US coins/bills or B) an electronic account that is in US dollars or will convert to them on your demand to US accepted 1s and 0s.

But I think you are missing my main point which is: Money in the modern world is what a government decides is money for the piece of turf on this earth they control. What gold fans refuse to recognize is that in reality it has always been this way and that gold can be debased by a government almost as easily as can paper money. Pretty much the only times this is not the case is when the government has lost control of its populace.

If it has lost control well who knows what will be "money" and gold/silver is probably a good first guess to posture for if you are so inclined.

1. Gotcha!...understand what your saying now.
2. Agree....this assumes "Responsible" is a constant (which history has shown to not be the case due to bad actors at some point). But agree.
3. It does not...and I won't try to say it will. The only thing Gold has is scarcity and hard to replicate (counterfeit)...that's about it.
4. I understand your point / agree.....I would rather personally rather have currency that is unmanipulatlable. I'm a PP'r…..I love diversity! I will hold Dollars, Gold and BTC. I can go anywhere in the world and someone will accept one these.
5. Agree...Per my above post. Government prints paper, government demands taxes be paid in said paper, threatens people to pay taxes or go to prison, <-- Voila! Paper now has value amongst the people! My point.....like it or not, BTC has been existence for 10 years and gets stronger more adopted by the day...."people" have a desire /want a money outside of government oversight, control and manipulation...it that's easy. Whether or not BTC ultimately delivers that is the questions.....time will tell. And straight up....I will move to another country if the US outlaws BTC. That would be pure infringement upon freedom of speech, property, etc.....(<--note, has nothing do with money...principles of no longer being a free(ish) country.)
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