Testing the Waters - All Comments

re: The Quantity of Gold

lake travis boat rental — Wed, 21 Jul 2010 18:01:01 GMT

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re: The Quantity of Gold

QHennigh — Sun, 22 Mar 2009 03:39:17 GMT

The ration of gold:people in 1910 was about 0.7 troy oz per person on Earth. Today, it is about 0.7 troy oz per person. The notion that there is not enough gold is rubbish, mostly propaganda by anti-gold types.

Gold mine output adds about 1.5-2% to the "above ground" quantity of gold every year. This is SUSTAINABLE growth. If we were to adopt the gold standard once again, it would generate sustainable growth throughout the world economy just like the governor on an engine.

Gold is the ultimate "democratic" money. If people have gold, they have power...the power to insulate themselves from inflation imposed by governments wishing to force fiat money upon them.

Many social democrats advocate a world currency. I am in favor of a world currency...based on the gold standard! Give power back to the people!

re: The Quantity of Gold

RayLopez — Sat, 21 Mar 2009 16:31:15 GMT

<i> Don't get to wrapped up in the details of this - they are abstractions to illustrate a point - but they show how the supply of money doesn't matter in the way that someone who objects that we wouldn't have enough gold thinks it does. </i>

In theory this is true--if the human population expands to 10 billion, as they say it will in 50 years--you can have a paper voucher that says "this voucher is worth 1000 atoms of gold"--and you can use the voucher to buy bubble gum. In practice, prices are sticky. This was Keynes great insight. Most people selling a house or asking for wages don't want to cut the asking price or take a pay cut--unless they are desparate. Do you indulge these people or force them, via a recession/depression, to change their ways? That is the central debate behind Keynesianism and Austrian/Chicago school economics.

re: The Quantity of Gold

Orobico — Thu, 19 Mar 2009 21:22:47 GMT

Couldn't electronic money backed by gold simply solve the problem of dividing a commodity in order to provide it to everyone?

re: The Quantity of Gold

sthomper — Sun, 15 Mar 2009 18:46:57 GMT

wouldnt there have to be enough physical metal to able satisfy redemption demands from paper receipts and money substitutes?

some people may be happy with never redeeming their gold - but if gold (and silver and possibly other metals) is used as money i would think it would be because a money user could redeem money substitutes for physical metal money.

re: The Quantity of Gold

Don Lloyd — Sun, 15 Mar 2009 05:03:20 GMT

The scarcity of money is primarily a limitation on the total amount of money that can be simultaneously held by individuals and other entities. Every dollar can only be held by one person at a time. OTOH, an exchange of a good or service for money merely changes the owner of the money involved. It doesn't change the total amount of money in existence and is not directly limited by the total quantity of money. Money is almost always a small portion of an individual's wealth and a lack of money will only prevent purchases that need actual money immediately for completion. If you have all of your liquid wealth in MMF's and no actual money, this will be a problem for buying something in a convenience store or paying a tow truck driver, but not for most possible purchases for which either MMF checks will be accepted or MMF checks can be converted to cash in a non-immediate, but still adequately timely basis.

Regards, Don Lloyd

re: The Quantity of Gold

No2statism — Sun, 15 Mar 2009 00:49:49 GMT

Excellent post=] It's good that you pointed out that platinum and other naturally occuring metals could always replace gold. a lot of people, even myself, at times, tend to forget that.