Home Forums Hunting & Shooting Hunter's Campfire The Gold Standard, Yes or No?

Exactly.

I think some have figured about $80,000 an ounce would cover it. Iirc.

Folks had cash, but were reluctant to spend it. The proof of this is that records from that time period show high rates of savings by Americans. This can be caused by a high rate of deflation, such that people see prices falling, so put off non-essential purchases till prices fall further, closer to what they believe is the price bottom, not wanting to feel ripped off after having paid X price for a product, and a month later discovering that prices had fallen significantly since their purchase. A seller might well interpret this as a shortage of cash in the system, but that would be false.

And that is the problem with deflation, and why it kills economic growth.

Economies run on private debt. Deflation creates an incentive to save, but no incentive to lend or invest. With no lending there's no new businesses, no economic growth, and worse, existing businesses can not function without sufficient working capital and properly functioning capital markets.

And that is the problem with deflation, and why it kills economic growth.

Economies run on private debt. Deflation creates an incentive to save, but no incentive to lend or invest. With no lending there's no new businesses, no economic growth, and worse, existing businesses can not function without sufficient working capital and properly functioning capital markets.

And if silver would return to it's historic value of 16 to 1 ratio with gold, metals could replace fiat as real money

And that is the problem with deflation, and why it kills economic growth.

Economies run on private debt. Deflation creates an incentive to save, but no incentive to lend or invest. With no lending there's no new businesses, no economic growth, and worse, existing businesses can not function without sufficient working capital and properly functioning capital markets.

They days of 16 to 1 are over.

It's unlikely silver will ever return to that price level, and you can thank your cell phone for that. In ages past the most significant industrial use of silver was film production. Now thanks to digital photography that demand is gone. As a result, we annually produce 4 to 5 times as much silver as we consume.

They days of 16 to 1 are over.

That ratio is natural only in the absence of legal tender laws supporting fiat currency. Repeal them, allow folks to contract for either payment in gold or silver instead of fiat paper, and you will see a return to that ratio quickly.

0% interest creates an incentive to spend and not save..... so there is that... it also forces the traditional savers into the Wall street casino.... bubble and bust, cleans out the little guy

Solar panels consume huge amounts of silver

Do you know how the 16 to 1 ratio came about? it was that value throughout history until modern "economic " theory started monkeying with things.
The fact that it is consumed as a commodity means it will less available and the ratio could go to say... 10 to 1?

Hawkeye..... you explain things much better than I do. This is correct.
Precious metals are currently traded as a commodity and are subject to extreme manipulation in the commodity markets by such techniques as naked short selling etc....
The S.E.C. looks the other way because they condone such practices because metals as real money threaten their fiat Ponzi scheme

To be clear, as a matter of policy, I'm not in favor of 0% interest rates, or the even more destructive effects of negative rates. Unfortunately, too many country's used the BS excuse provided by the followers of Keynes to overspend (think Japan) and create a debt bubble so huge they had to resort to zero rates to prevent the detonation a debt bomb. This lead to the "Yen Carry Trade", when traders would borrow money at zero rates in Japanese Yen and use it to purchase U.S Treasuries at say, 4%. This increase in demand for our Treasuries pushed yields down, and hence, gives us lower rates weather we like it or not.

As some of you may recall, after his appointment as Fed Chair, Jerome Powell attempted to RAISE our interest rates to something more "sensible" for a proper growing economy. However, money markets are not local markets, but global markets, so there was no way he could do this in the global low rate environment without crashing the U.S. economy.

The irony of this, is this global low rate environment's the reason all you old retired anti-globalist still get your social security checks.

Interest payments on the debt have dropped from a high around 16% back to their historical 7-8% level, despite our current high debt levels, as a result of low global interest rates. This free's up cash for your social security and medicare payments that would not otherwise be available. Without further increases in our nations debt.

The gold standard would prevent politicians from abusing our money....

No it wouldn't.

Politics is the practice of getting what you want with other people's money. The gold standard would not change that. If sure didn't hinder FDR, nor did it hinder our politicians post WWII, nor for that matter, did it prevent the Romans: