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jlf1961 -> RE: You got to be kidding me! (10/29/2008 4:18:38 PM)
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Unfortunately, when the US went off the gold standard, it was made illegal for citizens to own more than a set amount of raw gold, no more than $1200 worth, and the gold coins has to be collectors items.
As for the misunderstanding that paper currency is illegitimate is a false assumption. Under the constitution of the United States, all American currency is to be redeemable in either gold of silver of the full value of the paper currency presented.
Now, if you would like to hear the kicker of all this, in 1955 gold was $35 a troy ounce, and that means that you could redeem a dollar for 1/35th of that amount, or about .03 ounces of gold.
Now the current gold price per troy ounce, is $755.30 as of 1809hours central time, today.
That is an increase in value of %2158 which would mean that inflation would be ZERO, but then not many countries would be able to import goods produced in the United States.
Those countries being the UK, Japan, Australia and South Africa.
In the past, countries have used various precious metals and gems to back currency, at one time, some countries in africa used diamonds. Russia could back its currency with emeralds if it wanted and pretty much reverse inflation there.
The problem with using a current money market to set the value of currency is clearly evident in the modern world.
My personal opinion is that the world should go back on the gold standard, basing currency values on gold in the national reserves, which would set the current value of the dollar at 3 pounds sterling to the dollar.
This would mean that as gold prices went up, the dollar would have to be held in check by either printing more or increasing the value by a percentage point equal to the rise in gold prices.
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