Yes... I can see your need to create "heros" in your life. Most people who are followers, and not leaders, look to others for inspiration or cognitive and logical direction, due to their inability to self-generate individual thought.
And yes, I did read the article earlier. Apparently I just didn't associate it with "friendofanother" (whoever he/she is).
But if you recall, I stated some months ago that any attempt to use gold to artificially support the value of the Euro, are quite likely doomed to failure.
Currencies are strong because they reflect the economic and political policies of those nations that issue them. Europe is weak, both economically and politically. It is a confederation, held together only by mutual consent, and economic benefit. We tried that here in the US back before we wrote up the constitution. Under the Articles of Confederation, each individual state was independent, with a weak central control structure.
It failed.
Europe's political power still remains within the competing member nation states. It must become unified, with a European president, legislature, and law-making infrastructure, where all EU member people/nations become subservient to, or represented by, that authority.
Artificially pumping up the Euro by attacking the dollar with gold will accomplish nothing except to further undermine their economy. Contrary to FOA's ridiculous statement about American laziness and mental incapacity, our productivity is better than anyone other nation, and continues to grow (look at today's figures of a 4.5% increase in productivity).
A more productive economy can deal with currency fluctuations far better than a less productive one. And eventually, those currency differences correct themselves and trade once more on fundamentals.
It is flawed thinking, Doug. And that is probably why you have latched onto FOA's words so readily. There is no major need for "digital gold" in a world where financial transactions take place at the speed of light (or close to it). I sell dollars for yen in my account and that exchange is processed based upon the market value of both currencies at that particular time. Gold is not involved, the market determines the price instaneously. I don't have to ship the physical currency overseas or to another bank.. nothing.
So long as each banking institution respects the obligations between each other and with account holders, my value is preserved. This is the same whether currency is fiat, or backed with gold. Even with gold backed currency, my accounts (wealth) are only guaranteed by the goodwill and integrity of the banking institutions I hold that wealth with.
In the end, the strength of any financial system is only as strong as the willingness of its member parts to completely fulfill their respective obligations. Why else are defaults and bankruptcies so frowned upon?
As for Ole 49r, I'm probably the only man out here who has taken her to task for unabashedly using the SI forum to advertise her dubious gold mining venture with "Roy". She likes to beat up on Bill Murphy, but she certainly isn't willing to discuss the "merits" or "integrity" of her particular ventures.
Regards,
Ron |
