Claude, a sure way to get the whole financial world into the main tail spin will be to bring gold to $15,000 to $30,000 an ounce, business will abandon all other activities and move to extract gold from the ocean (I made the calculation once, $15,000/ounce is profitable). But more importantly, the "transition" will be encountered by a wave of inflation never seen before. Once the transition is complete, you'd think that you cured inflation for ever, but no, since the gold supply per capita, as you say is .72 onces, the gold per capita will have to decrease since the world population increases, furthermore, that same gold will have to support an increasing standard of living of populations growing much faster than the world's head count. That is what I meant by "putting the world economy in a straight jacket". Pure fantasy and romanticism, befitting A. Rand, maybe, but not an enlighten world that is seeking to bring a higher standard of living to an increased proportion of the world population.
Zeev |
