Again, the argument against fiat is that it is too easily abused by governments and vested interests, and that throughout history its value has gone to ZERO. Have we cleared up that point up yet? ***
It won't be abused if people stop permitting the gov't to patronize them by trying to buy their votes with pork barrel projects and parochial interest.
That is why the Federal Reserve and its Chairman are not an agency of the gov't, although the Chairman is appointed by the President and approved by the Senate.
As I stated before, the drawbacks we both acknowledge, like minimal economic expenditure of mining resources and a 1-3% fluctuation in mining supply each year is far and away a small price to pay for stable, honest money, backed by assets,
What costs more?? Mining for a shiny metal, or printing specialized cloth paper with water marks printed on it? Not who's talking about Chicken feed? And you're not even killing that many trees in the process (just cotton plants which die each year anyway.. ;0)
And how do you find enough gold to finance the MASSIVE economic expansion that technology is bringing forward?? There are things we cna't afford to do, and things we can't afford NOT to do. Technology is paying massive dividends on the investments in that field. Investments that would not have been as rapid or occurred at all under a restrictive gold standard forbiding deficit spending or borrowing more than exists.
*** Well, I wouldn't necessarily decide silver not be used. It could be silver but I suggest gold because it has, on the whole, more desirable properties, and has been used more widely and successfully as the monetary basis of choice. Again, the argument against fiat is that it is too easily abused by governments and vested interests, and that throughout history its value has gone to ZERO. Have we cleared up that point up yet? ***
Nice job of advancing to the rear... Two Points... RON!!
But you still haven't answered how you can have confidence in a partial gold standard where the reserves of metals doesn't fully back the outstanding money supply. I mean isn't the who idea that you can exchange gold for dollars 1 to 1.. ??
That's not possible in a partial reserve system and thus your currency is, at its essence, as fraudulent and inflated as any Fiat system.
My point is either you have a currency totally backed by gold...
....or don't even bother. It would be exchanging one confidence game for another in hopes that you wouldn't have a mass withdrawal of gold at the same with the result being a financial game of "hot potato" or "musical chairs" where you hope not to be the last one stuch with the worthless paper.
Regards,
Ron
Technology is bringing innovation and productivity gains at a tremendous rate. It would be an economy that emerging growth nations would be able to enjoy as well were their financial systems not so corrupt and opaque (at least more than ours currently is...:0).
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