Skip to comments.CNBC Analyst Rips Ron Paul: He 'Doesn't Even Have a Basic Understanding of Fundamental Economics'
Posted on 06/14/2010 3:04:17 PM PDT by Rufus2007
This one was one that you just couldn't let go - that libertarian champion and former Republican presidential candidate Rep. Ron Paul, Texas, doesn't have a basic understanding of economics.
That was the claim made by CNBC senior analyst and commentator Ron Insana on the June 14 broadcast of "Closing Bell." At issue was a June 14 Washington Post article by Robert O'Hara and Dan Keating that suggested there was a conflict of interest in Paul's investments and his policy stances, as in he is a proponent of the gold standard and other uses for the precious medal.
"Rep. Ron Paul is captivated by gold," O'Hara and Keating wrote. "Over the past two decades, he has written books about the virtues of gold-backed currency. He has made uncounted speeches about the precious metal. He even took a leadership post on the House subcommittee that oversees the nation's monetary policy, mints and gold medals."
(Excerpt) Read more at newsbusters.org ...
Mister I am so pure (earmark hog) Paul is a bomb thrower.
Ron Paul understands economics better than Mr. Poor does the English language.
I’m in favor of gold-backed currency, if we had any more gold to begin with.
Jeff Poor, proponent of Kenyansian Economics.
Clintoon sold it to the Chicoms, replaced it with plated tungsten bars. So I read, anyway... nahhhh!
You have put your finger on the basic problem.
There is not enough gold in existence to act as money. The total economic activity in the world is so great, prices in gold would have to be tiny, and as the world output increased deflation would be a constant issue.
How about silver? I think we used silver to back up our currency before. I believe I still have a couple of “Silver Certificates” somewhere.
Ron Paul is as much a "bomb thrower" as you are "intelligent".
That Jeff Poor guy is a moron
Prices that fell with the rate of economic growth, what a disaster . . . NOT. How can anything be worse than a central bank that sets the interest rate at essentially zero, robs savers, and collapses capitalism itself through massive subsidies to debt that fuel massive overcapacity? How can any thinking person support such a system?
This is coming from the same guy - Poor - that asserts that to get out of recession and debt, we must spend our way out....at the same time, acknowledging that our debt is unsustainable....let the idiot apply this to his own home finances and get back with us the day he files bankruptcy. In short, Poor is an idiot and should keep his mouth shut!
“How can any thinking person support such a system?”
That system is adored by many on FR, and any alternatives are factually denounced as goofy.
... but many have seen the error in their thinking after a generation of bubbles, busts, and promises such as “this time it’s different”, “we have conquered inflation”, “we have conquered the business cycle”, etc, etc.
The silver tsunami is in for a rude awakening.
I would feel safer with my economics being handled by Ron Paul than people who believe in the WTO, NAFTA, CAFTA, and all the other trade deals that have totally failed.
The biggest problem people have with Ron Paul is that he is against the UN, WTO, NAFTA, and all those failed globalist unions and “trade agreements”. Paul is also the biggest threat to the Globalists because he not only understands that the Liberal Globalist Free Trade deals are not really free trade.
Most people that have so called “problems” with Paul are his anti-Globalist stances
Hey I have no love lost for Dr Paul but Insana ‘s qualifications were evidently enough to run a hedge fund into the ground using “sound and basic economic principles”
Even if there were just one pound of gold in the world and no more left in the ground, that pound of gold could still serve as a counterpart for any amount of money. The normal daily trading doesn't need gold to be physically moved around, since either computer bits or at most paper being moved around.
The hypothetical 'last pound of gold' would simply cost the total of the paper money available at any time and could be cached back to paper money of equivalent in goods and services. Since economy, despite short terms ups and downs, does grow over time (more people and better technology yield accelerated product output), that fixed amount of gold would keep getting worth ever increasing quantity of goods and services.
As for paper/electronic money, since people prefer figuring things in small integers, the total quantity of paper money would have to grow in general sync with the growth in goods and services. Since supply and demand will adjust pricing of goods and services, targeting the fixed average price of goods and services is a perfectly good feedback mechanism maintaining the supply of paper/electronic money equivalent to the value of economy. The only thing which would keep getting costlier over time would be that hypothetical fixed quantity of gold. The role of that gold is simply to keep the government money presses honest, since government wouldn't hold all the gold in their vaults.
Unlike the hypothetical example, in practice, we don't have known, fixed quantity of gold but rather a slowly increasing quantity and which is only known approximately. Hence the actual rate of rise in the price of gold in the real world under the gold standard would be lower than the growth rate of the economy. The market itself can regulate that sort of pricing perfectly well, without any bureaucrats getting involved.
As to the Mr. "Insane" ripping Ron Paul, the "Insane" would gouge his mothers eyes if that would get the ratings of his show up. He didn't provide any tangible argument to back up his hyperbolic pronouncements. After all, he is not a real expert on anything other than playing insane ranter on TV.
Not that it makes much difference, but the Constitution is quite explicit about what money is: gold and silver.
Article I Section 8 states, “The Congress shall have power ... To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures; To provide for the Punishment of counterfeiting the Securities and current Coin of the United States.” The standard of weights and measures applies to the precious metals content and alloy of US Coin. It’s no coincidence that, immediately after adoption of the Constitution, Congress commissioned Alexander Hamilton to report on the standards of foreign coinage and to define the dollar. His report defined the Dollar in terms of silver.
It is absurd to interpret these enumerated powers as authorization to establish a fiat currency. How on earth could Congress regulate the value of a fiat currency versus foreign Coins of precious metal or foreign fiat currencies? Sure, the US Treasury has tried to do this over and over again, but they have never been successful for more than a few years. Note also that Section 8 empowers Congress to coin Money, not to print Money.
Section 8 also states, “No State shall ... coin Money; emit Bills of Credit; make any thing but gold and silver Coin a Tender in Payment of Debts.” States routinely ignore this prohibition. Legal tender law in the US stipulates that payments to settle debts and judgments be made in Federal Reserve Notes, and all courts rule as though legal tender legislation trumps the Constitution.
This is just more evidence that the Constitution is a dead letter. The legal tender cases date back to the Civil War era.
I bet life is wonderful when the most complex thing one is able to contemplate is better dope.
No wonder you're so happy.
As long as CNBC ridicules goldbugs — Ron Paul in this case — we can’t be anywhere near a top.
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The gold is not used as money, The gold is used to settle sovereign accounts. Money will continue to be ledger entries or electronic blips but trade is balanced by moving gold
There is always enough gold. The value of the finite amount is reflected in the valuation of the currency.
Wouldn’t it be prudent to find that out before coming out in favor of a gold-backed currency?