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@z1235 Why/how would a repeal of legal tender laws and capital gains taxes eliminate FDIC and the lender of last resort? It wouldn't. I'm saying if the goal is a free market in money, you need a free market in banking as well , as the two are obviously linked inextricably. Is your plan to eliminate legal tender laws and capital gains taxes but
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@Phi est aureum First, I wouldn't say that a gold bug spending his goldbug is no different than counterfeiting. Counterfeiting is illegitimate; acquiring gold prior to the collapse of a currency is not. Similarly, someone who mines gold is not on the same level as a counterfeiter. Although they do spend their gold into the market, they used capital
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@z1235 And what "inflation" are you talking about? The addition of new money to the money supply from two sources: (1) privately held gold in the US prior to revaluation, and (2) the influx of foreign gold. The fact that the dollar is worthless is not Rothbard's problem. It's a fact. I didn't say it was "Rothbard's problem
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[quote user="Graham Wright"]Suppose Murray Rothbard's plan to restore the link between the dollar and gold was carried out. What would be the effect on the markets? The dollar will be redefined as a weight in gold. The banks would be capitalized with Fed gold and allowed to print bank notes, and Federal Reserve Notes would be redeemable
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@Phi est aureum I'd say, given the numbers you use, then yes, there would be inflation. However, this is not a result of going to a gold standard, I don't think. If it were, then the assumption would be that adhering to a fiat currency – with legal tender laws and a monopoly on the creation of said currency granted to the federal reserve
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This is Rothbard's proposal for returning to the gold standard and free banking (slightly modified, I've included savings deposits in calculating the new par, whereas for some reason Rothbard did not, even though he agrees that they are demand liabilities). 1. Divide the quantity of gold in official reserves by the quantity of federal reserve
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[quote user="Leon Wolf"]Great analogy, thank you! One last question: What about an economy where everything is like in the US except for the FED leaving the interest rates alone? Would interest rates still go up if people saved less and go down if people saved more?[/quote] Without the Fed fixing interest rates, or any other similar government
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Just to clarify... 1) Abolition of property in land and application of all rents of land to public purposes. Translation: a violent criminal organization calling itself "the government" seizes all land 2) A heavy progressive or graduated income tax Translation: this violent criminal organization steals a large proportion of all incomes outright
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By way of analogy, suppose there's a waterslide, where the water collects in a pool at the bottom and gets pumped back up to the top, so that it flows in a loop. The pool is the bank, the rest of the circuit is the path of the money through the economy outside the bank. When the savings rate goes up, the circuit gets longer. Instead of a 100 foot
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I understand your point, but as a matter of strategy I don't think we should favor tax increases under any circumstances. The only reason anyone is discussing spending cuts in the mainstream is because of growing fear over the deficit. If the deficits shrinks thanks to tax increases, that will greatly reduce the interest in cutting spending.