Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: gold$10k who wrote (16014)	6/4/2014 1:31:32 AM
From: Hawkmoon	1 Recommendation Recommended By Hank Scorpio Respond to of 33421

Churchill's only mistake was going back to the pre-WWI price of gold which was too low and therefore constrained the money supply, which was indeed deflationary. And consequently readjusting the POG to match the amount of USD in the system would really only benefit those who hold gold.. Not really the economy.. What we NEED to do is manage debt to assets and income as a reasonable level. We can't run an economy by expanding debt to feed non-productive activities.. Debt is not a problem so long as it is at a level that can reasonably be paid back. Excessive debt leads to defaults, and/or financial austerity required to pay that debt back (paying back debt at the expense of consumption). That is ALSO deflationary because it results in the destruction of money (debt being the means by which money supply is increased). Economic policies, and therefore money supply, should be based upon the productive output. They way I look at Gold is that it might be a strong backing for money, but it's also a cage that limits the economic and productive potential of entrepreneurs and innovators.. (ie: human potential). There is only so much gold in the world, and it's unevenly distributed. Like Saudis finding oil and suddenly becoming fabulously wealthy (think Beverly Hillbillies), they may have the money, but they lack the solid social infrastructure of small and medium business formation and innovation. The same is true with those countries that suddenly discover huge quantities of gold. Economic potential should be based upon people's ability to obtain, and PAY BACK, debt used to finance business and personal activities. Hawk