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Alternatives to fiat money & the gold standard

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Rubén posted on Mon, Oct 20 2008 1:00 PM

It seems to me that going back to the gold standard would be impractical for a few countries. However, convincing arguments have been made that the fiat system has failed.

Is it feasible to back a country's currency with a commodity such as oil? I wonder if perhaps that could help out the stability of many OPEC economies.

Art transcends ideology.

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Answered (Verified) Chris replied on Tue, Oct 21 2008 12:24 PM
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IMHO, I think you have that backwards. Also, I recently signed up to this website to see if there's constructive ways to look for real answers to our financial and political problems. It seems most times 'Libertarians' and other outside the popular culture groups fight and argue (I mean discuss) among themselves and very little is accomplished. I would love to see a grass roots movement of limited government (constitutional) and honest money start to sweep our nation. I'm interested in joining a study group or forming one to start with educating people to alternatives.

Christopher M. Mahon

http://ambidextrouscivicdiscourse.blogspot.com/

 

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Answered (Not Verified) Julio replied on Tue, Oct 21 2008 11:27 AM
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FIAT MONEY HAS NOT FAILED. It is a very good system, its only loophole is that we have no control over its supply. The Fed does. If we keep supply tight enough, fiat is an awesome way of financing an economy.

Tying to a mineral, commodities or anything like that is unpractical in the long run. Imagine we take gold as money, then new discoveries are made and each human in the planent can get 10 pound of it. ITS WORTHLESS. Fiat money enables us to always be in control of our money. MOney is only to value things under one universal good.

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ricarpe replied on Tue, Oct 21 2008 11:38 AM

Julio:

FIAT MONEY HAS NOT FAILED. It is a very good system, its only loophole is that we have no control over its supply. The Fed does. If we keep supply tight enough, fiat is an awesome way of financing an economy.

Tying to a mineral, commodities or anything like that is unpractical in the long run. Imagine we take gold as money, then new discoveries are made and each human in the planent can get 10 pound of it. ITS WORTHLESS. Fiat money enables us to always be in control of our money. MOney is only to value things under one universal good.

You contradict yourself.  "... its only loophole is that we have no control over its supply. The Fed does."  Which is followed by "Fiat money enables us to always be in control of our money."  We are either in control or not.

As far as discovering a new source of gold that gives every human on the planet 10 pounds of it, to that I would counter with: Imagine if the Fed in conjunction with the Treasury Dept turned on the printing press and injected hundreds of billions of dollars (a fiat currency) into the financial system.  It becomes worth less, does it not?

"All men having power ought to be distrusted to a certain degree." -James Madison

"If government were efficient, it would cease to exist."

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Chris replied on Tue, Oct 21 2008 11:38 AM

Thomas Jefferson: I believe that banking institutions are more dangerous to our liberties than standing armies. Already they have raised up a money aristocracy that has set the government at defiance. The issuing power (of money) should be taken from the banks, and restored to the people to whom it belongs. — Lincoln Money Martyred

If the American people ever allow private banks to control the issue of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children will wake up homeless on the continent their fathers conquered.

We need to remove the power to print money out of government and banks hands.

Christopher M. Mahon

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Chris replied on Tue, Oct 21 2008 11:47 AM

I'm all for printing money, as long as I own the printing press and I'm all for Monarchies as long as I'm the King. It's good to be King!

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Juan replied on Tue, Oct 21 2008 11:49 AM
Julio:
Imagine we take gold as money,
We don't need to imagine it -- just check any history book.
...then new discoveries are made and each human in the planent can get 10 pound of it. ITS WORTHLESS.
No it is not. Besides the chance that huge amounts of gold will be discovered all of a sudden is pretty slim.

February 17 - 1600 - Giordano Bruno is burnt alive by the catholic church.
Aquinas : "much more reason is there for heretics, as soon as they are convicted of heresy, to be not only excommunicated but even put to death."

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Juan replied on Tue, Oct 21 2008 11:53 AM
ChrisM:
Thomas Jefferson: I believe that banking institutions are more dangerous to our liberties than standing armies
That's just one more thing that Jefferson got wrong. Bankers can only print pieces of papers. Soldiers on the other hand are people who kill other people when politicians tell them to.

February 17 - 1600 - Giordano Bruno is burnt alive by the catholic church.
Aquinas : "much more reason is there for heretics, as soon as they are convicted of heresy, to be not only excommunicated but even put to death."

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Chris replied on Tue, Oct 21 2008 12:00 PM

And who do you think are behind those politicians and financing those wars?

Christopher M. Mahon

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Juan replied on Tue, Oct 21 2008 12:12 PM
In order to actually steal wealth you need violence - that's the core business of politicians and the military. Bankers are only a facade. I'm not saying they are not part of the system -- I'm saying that their power is granted to them by the government, that is, politicians and the thugs that protect them -- cops and the military.

February 17 - 1600 - Giordano Bruno is burnt alive by the catholic church.
Aquinas : "much more reason is there for heretics, as soon as they are convicted of heresy, to be not only excommunicated but even put to death."

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Answered (Verified) Chris replied on Tue, Oct 21 2008 12:24 PM
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IMHO, I think you have that backwards. Also, I recently signed up to this website to see if there's constructive ways to look for real answers to our financial and political problems. It seems most times 'Libertarians' and other outside the popular culture groups fight and argue (I mean discuss) among themselves and very little is accomplished. I would love to see a grass roots movement of limited government (constitutional) and honest money start to sweep our nation. I'm interested in joining a study group or forming one to start with educating people to alternatives.

Christopher M. Mahon

http://ambidextrouscivicdiscourse.blogspot.com/

 

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Rubén replied on Tue, Oct 21 2008 12:30 PM

I agree with you, CHrisM, let us make that grass roots movement global since I wish to help out but I do not happen to live in the US.

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Juan replied on Tue, Oct 21 2008 12:33 PM
ChrisM:
IMHO, I think you have that backwards.
No doubt my position is the opposite of yours - in that sense, I have it backwards. The things is, you fail to acknowledge the true nature of political power.
I'm interested in joining a study group or forming one to start with educating people to alternatives.
Maybe before educating other people you should try to better understand what's going on ?

February 17 - 1600 - Giordano Bruno is burnt alive by the catholic church.
Aquinas : "much more reason is there for heretics, as soon as they are convicted of heresy, to be not only excommunicated but even put to death."

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Chris replied on Tue, Oct 21 2008 12:44 PM

Juan, I thank you for your advice and appreciate your positions. Now, regarding a 'work group' does anyone know of anything that is currently up and running or have any experience on how to develop one? I think that the US citizens and others around the world are open to alternatives to current economic thought (planned societies) and it seems it is easier today to 'connect the dots' to show historically what has happened and why we're in the mess we are in. thanks.

Christopher M. Mahon

http://ambidextrouscivicdiscourse.blogspot.com/

 

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Now, everybody that still believes Hayek's idea that there is such a thing as price levels and that currency minters can control it should read this: http://mises.org/money/2s10.asp and http://mises.org/rothbard/genuine.asp (section 'The "Commodity Dollar": A Critique')

To put it shortly: stable money is impossible. And you can't fine-tune it to make one price go up or down unless you actually buy/provide that commodity in exchange. If you tune the money supply, everything will go up or down. However, it's rather unworkable in a free society, it only works in states which have no problem with spending your money "for the greater good".

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i would not advise the gold standard because that would immediatly mean the largest holders of gold would insto facto rule the world. (big banks hold trillions worth of gold in their vaults). also china has more gold than the united states.  the oil standard is an interesting idea but i think it could be improved by making it an energy standard.  this would creat incentaves to produce energy through much more efficient and clean ways. (hydroelectric/solar/wind/thermal/tidal)  this would over time decrease our dependance on oil. if money = energy people could in theory make their own generators from scrap materials and contribute to the grid for cash. this is just an idea i though of a while back.  also it would force people to think of new ways to store energy which would benefit the world in many ways.  

silver would be better than gold aswell. just ask lincoln and jfk.  

btw this is not really ron paul speaking (he wants the gold standard) or silver

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@RP: Yeah, you had us confused for a second there... not.

We don't need any "standard", we need a free market in the production of money. Consumers will choose the money that works for them, whether that be gold, silver, copper, whatever. Oil would not make a very good money.

Clayton -

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