Posted on 04/01/2009 11:47:40 AM PDT by nickcarraway
Russia has become the first major country to call for a partial restoration of the Gold Standard to uphold discipline in the world financial system.
Arkady Dvorkevich, the Kremlin's chief economic adviser, said Russia would favour the inclusion of gold bullion in the basket-weighting of a new world currency based on Special Drawing Rights issued by the International Monetary Fund.
Chinese and Russian leaders both plan to open debate on an SDR-based reserve currency as an alternative to the US dollar at the G20 summit in London this week, although the world may not yet be ready for such a radical proposal.
Mr Dvorkevich said it was "logical" that the new currency should include the rouble and the yuan, adding that "we could also think about more effective use of gold in this system".
The Gold Standard was the anchor of world finance in the 19th Century but began breaking down during the First World War as governments engaged in unprecedented spending. It collapsed in the 1930s when the British Empire, the US, and France all abandoned their parities.
It was revived as part of fixed dollar system until US inflation caused by the Vietnam War and "Great Society" social spending forced President Richard Nixon to close the gold window in 1971.
The world's fiat paper currencies have lacked any external anchor ever since. It is widely argued that the financial excesses and extreme debt leverage of the last quarter century would have been impossible - or less likely - under the discipline of gold.
Russia is a major gold producer with large untapped reserves of ore so it has a clear interest in promoting the idea.
(Excerpt) Read more at telegraph.co.uk ...
Sounds like the Russians and Paul are on the same page.
This USED to be the way the world worked. Until Nixon that is.
The sooner we do, the sooner the recovery can begin.
Going to the gold standard was one of the biggest factors that led to the Great Depression. It would tighten the money supply too quickly and too much.
Nixon was also a big spender. He went off the gold standard for the same reasons Johnson quit using silver in coins. FWIW, the Morgan silver dollars were about .77 ounces, and with the price of silver at $13, their silver value is around $10. A silver dime is worth around .94. That's silver content only, not including numismatic value. Roughly, that means if you chopped one zero off, money value would be equivalent to what it was in 1964.
Others here disagree, but barring stuff like televisions and computers where manufacturing has gotten so much more efficient that costs have dropped dramatically, about 90% of our monetary worth is due to inflation.
Did i wake up in Bizzaro world? *Russia* says the gold standard should be observed while an American President seizes the means of production, nationalizing the private industries?? Sweden is warning us against socialism? China is lecturing us on fiscal discipline? Canada won’t let Bill Ayers and George Galloway into their great nation, but they can both stroll into our white house at will?
I don’t know whether to laugh or cry, or check my coke for LSD.
I think somebody slipped coke in my LSD.
During the Spanish Civil War the left wing, so called, republicans allowed the Russians to load up all the gold in the Spanish Treasury into a ship and transport it to the USSR. The Spanish economy never even had a prayer of recovery until the end of the Gold Standard. I hope Spain’s new al-Quaida overlords are prepared for Change.
“Money supply” is meaningless, unless you want to confiscate priate savings by inflation to finance massive government spending. Nobody else ive ever read says the gold standard caused the depression, can you refer us to an author, etc?
It seems that if that was the case, then the depression should have been fixed in a jiffy when FDR took us off the gold standard and started following Keynes.
And thats a GREAT tagline. LMAO
iirc, the book is “The Lords of Finance”. I heard the writer in an interview on pbs recently.
Gee and Iran is invested in Venezuela’s gold mines.
So, the question is:
Are the conspiracy theorist correct in that there is no gold in Fort Knox and hasn’t been for decades?
http://moderate.wordpress.com/2008/01/30/gata-to-federal-reserve-wheres-the-gold-in-ft-knox/
Gold...what a novel concept.
Hmm, you think that if gold was such a good idea our founders would have put it into the Constitution...
Under a gold standard, prices would drop to account for a static money supply. It's exactly how the economy functioned in the late 19th century.
The Russians and OPEC want oil and other things to be paid for in something that will not inflate rapidly and become worthless. Same with the Chinese.
But a static money supply does not help economic growth, which is why we left the gold standard as I understand it.
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