gold backed dollar


Well-Known Member
Sep 27, 2010
After thinking about that question, my central reason for being pro gold backed dollar must be my loss of faith in the systems and methods of the Fed. Devaluation is just an outcome of a system that relies too heavily on human judgment. One act of poor judgment could spread the loss of faith beyond a few people like me. which is whats happening now...

The guideposts being used at the Fed are not well known or understood. The Fed has tons of data but decisions aren't based on a model, formula, or some other construct. They can't be. They admits it. Flexibility is an absolute must. It's all about making judgments. The Fed can't be confined to any model or formula. This makes for a faith-based system and a faith-based dollar.

The Fed pushes and pulls the economy by expanding/contracting money and credit. They are in the driver's seat. And the car (our economy) keeps swerving across the white line in waves that take us from shoulder to shoulder. We haven't fallen off the road and into the ditch, yet.

I'd rather put the economy back into the driver's seat. It seems that a dollar partially backed by gold would help put the economy back in charge of its destiny. The Fed would change or even be abolished. Good judgment about monetary situations would still be required, but sound money would provide a guidepost to the decision-making process about money and credit.

I believe a gold-backed dollar will be more stable. It will allay fears of foreign disinvestment, smooth out the economic swings, and trim the balance sheet by helping to eliminate debt.

The Fed cannot see that it is the cause -- and a subsequent reactionary to its own causes -- of boom/bust, deflation/inflation, recession/expansion, employment/unemployment, etc.

In summary, my rants aren't about the artifacts and outcomes of having/not having gold in a dollar. They are about changing the system to save us from a future that perpetuates cyclical extremes. A better system can result in artifacts and outcomes less stressful to the economy. That's the role for gold. I may not have it right. It's a tough subject to tackle.

There is this pesky problem called "peak gold". There is not enough gold, either mined or unmined, on earth to allow the United States to go back to a "gold standard", at least not at current government spending levels.

Countries like China and India and Australia and Japan and most European countries are buying gold and silver as fast they can, and countries like China and many South American countries are mining gold as fast as they can.

The U.S. Mint has been unable to keep up with the demand for their gold and silver American Eagles for the past 3-4 years. The mint can't get the gold and silver blanks they need to make the coins.

I have proposed a hybrid gold/silver/platinum standard for a few years now, but the new system will require massive federal funding cuts, simply because of the inventory problem I previously mentioned. It's the only hope we have of having a legitimate monetary system.

Get rid of the paper and ink promises, and bring back silver certificates, gold certificates, and gold and silver coins. All based on the actual value of the gold or silver coin, with the "paper" money serving as legal instruments of trade for the equivalent amount of silver or gold.

It's time to bring back the system that John F. Kennedy had just started shortly before his assassination. JFK wanted to abolish the Federal Reserve. He never got the chance. Coincidence?

The days of paper promises must be brought to an end. Thanks Woodrow.