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Politics : Dutch Central Bank Sale Announcement Imminent? -- Ignore unavailable to you. Want to Upgrade?

To: Mike M2 who wrote (3616)	2/21/1999 12:54:00 PM
From: Hawkmoon	Read Replies (1) \| Respond to of 81831

William, When I stated devalued, I meant that the dollar has not been devalued against any other currency. I was not implying that the dollar had not been devalued against a commodity like gold. The dollar has been effectively devalued against oil as well due to the increase in prices of petroleum since the 1960's. Again, what exactly would be the mechanics of reinstituting a gold standard?? Do we back each dollar by a corresponding amount of gold, payable upon demand as gold and silver certificates specified?? Due to the relative rarity of gold and silver, would not any economic growth worldwide place even higher premiums on the relatively limited availability of capital to back them up (Given the understanding that capital would only be available if there were the requisite reserves of gold)?? So wouldn't economic growth basically become dependent on the speed and efficiency with which gold could be mined from the earth in order to meet the demand for capital?? Seems to me that this analogy is similar to saying that the speed of capital and economic growth should be tied to the amount of diamonds that can be mined as they are far rarer than gold. An interesting twist implicit in tying capital to the availability of diamonds would be the issue of zirconia. Man-made diamonds are just a pretty and generally as durable as natural diamonds, with the only exception being that they are artificially produced by man. What if someone discovers the alchemist's dream of converting other elements to gold?? (not so far-out given the advances in nuclear technology). Hmmmm..... I would like to hear some comments from yourself and others about these analogies. Regards, Ron