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To: KeepItSimple who wrote (75154)	3/4/2001 12:02:39 AM
From: JRI	Read Replies (1) \| Respond to of 436258

KIS...whadda see happening early next week....do the big indices crack the seemingly close and significant support level on Monday (or early week)?

To: KeepItSimple who wrote (75154)	3/4/2001 12:39:25 AM
From: brightness00	Respond to of 436258

I agree 100% with your understanding of what money is, namely a service promised to be rendered at a future date. That's why monetary stability is extremely important. How do you achieve that kind of stability? IMHO, gold is a good benchmark. As I said before, gold is a good benchmark because: (1) the likelihood of sudden discovery of easy gold supply so enormous that would unhinge the system is extremely unlikely; hasn't happened in five thousand years, why should it now? the worst inflation under the gold regime was when the Conquistadors took the gold loot from central and south America, resulting in a "rampant" inflation of less than 2% per annum over a couple decades. That was the worst in thousands of years of gold regime, a heck lot better than the last 70 years we have had. (2) gold itself has very little practical use, unlike platinum, especially in the form of palladium alloy. Therefore the likelihood of sudden demand surge is also very unlikely, short of real inflation fears (and obviously war, which is fundamentally also an inflation fear) (3) gold production is relatively spread around the globe, so you won't have something like the OPEC or De Beer cartels. I am by no means fixated on gold. If any of the above-mentioned three conditions change, such as your hypothetical east canuckistan scenerio, I'd be all for findig an alternative benchmark. However, keep in mind, these three conditions have not changed in thousands of years of global economy; the chance of change now is extremely remote. BTW, I agree with you 100% that the rest of the world should effectively stop minting currency altogether. The US dollar, due to its underlying economic pre-eminence as you mentioned, should become the de facto currency of the world. The rest of the world should either dollarize or fix to the dollar/gold. A single currency system is far more efficient for commerce throughout the world. But in order to do so, the US dollar itself has to stabilize and become relatively free of political and bureaucratic mal-adjustment. The Brent Wood system would have survived if not for the US policy makers buying into the stimulation through devaluation nonsense. Jim