You keep stating that gold is a medieval concept. Article I Section 10 of the Constitution declared it illegal to use anything but gold and silveras legal tender. There is ample evidence that the founders never intended the use of anything but gold and silver for money. They learned that hard lesson during the Revolutionary war (Continentals were worth nothing by the end of the war).
The reason we went off the gold standard was to satisfy the interests of the Fed (which are privately owned banks by the way). They wanted to be able to water down the value of the dollar (it's worth 5% of what was worth in 1913) and to create a system where the government would use borrowed money to create more and more debt every year (now at 6 Trillion and climbing). From there it was a simple step towards creating a larger and larger central government that would be funded by an Income tax and inflation. This would have been impossible to do without detaching the dollar from any meaningful peg.
Lastly, no fiat currency has ever in history succeeded...not ever! It has been tried over and over again in history never works. It never works because the people in control of the government (whether its a monarchy, representative democracy or a "socialist nirvana") will always strive to print more and more of it until it becomes worthless. Our experiment is about 30 years old, how much longer will it last?
I guess I'm done...and please don't throw personal insults at me like youy did with a couple other posters here...
That is not true. I saw a clip of Franklin Delano Roosevelt on the History channel a few months ago. He said we were going off the Gold Standard so an American dollar would continue to be worth a dollar.
:-)
That doesn't seem to make any sense. Why would banks want to water down the value of the dollar? Don't banks pool lots of short-term deposits to make larger, long-term loans? If the dollars decline in value while they're out on loan, the banks get screwed. I would think banks would be strongly opposed to inflation.