Everyone is on the Gold Standard. It's not a choice any country or central bank can make. - 0 views

gold gold-currency wsj robert-mundell milton-friedman fiat-currencies

started by Gary Edwards on 20 Oct 10

#1 Gary Edwards on 20 Oct 10

Dear WSJ Moderator,

I tried to post a comment to the community forum for the article, "Currency Chaos; Where do we go from here?" My comments were rejected with the error message, "The language you used does not comply with community standards. Please re-enter."

I read through my post, as well as the community rules for posting, and i can't find anything objectionable or contrary to the rules for posting? What gives?

Would you please be so kind as to explain to me the problem with my language?

Thanks for the consideration,

~ge~

Comment:

The world is on the Gold standard. Always has been. The difference is that some people know this, and others don't. Politicians, bankers and world traders prey on those who don't know this. Signing on to a dollar denominated contractual obligation or interest rate is reckless playing the predators game. The idea of a fixed-exchange between the dollar and euro is okay. But the idea of fixing either the dollar or the euro to Gold is nonsense. Sorry Mr. Mundell, Milton was right. Fiat currencies must float against the value of Gold; just as commodities, services and goods must also float against Gold.

Gold is a way of thinking. It's also the viewpoint that changes everything, even though the opportunity for this Gold view comes to us courtesy of advancing Web technologies and the connective power of pocket devices capable of universal access and exchange. Having the Internet in your pocket is the power to think in terms of Gold instead of dollars. Or any other fiat currency for that matter.

Many will ask, "Why now?" Others will ask, "Why gold?"

Well, Gold is elemental and about as constant in value as anything mankind has ever known. Sure, a gold rush here and there can set off a frenzied bubble of effort. But when has the supply of gold ever diminished the demand? Besides, how would you measure that except through the use of other precious metals, vital commodities or volatile currencies. My guess is that the value of Gold would be stable beyond even the most advanced algorithms precisely because the alchemy of uncertainty that pervades the value of everything else exceeds that of Gold.

But why now?

The problem i think has always been that of real time information and a transparent marketplace where the value of any currency, commodity or trade exchange unit can be evaluated against Gold - in real time. I suggest that today the electronic mechanisms, networking and devices are in place to use Gold as a real-time currency, but most people choose to live in the past. Or they are in on some predatory obfuscation scam based on insider undervaluing or over valuing fiat currencies. The worst case being the skewering of unwitting contractual obligations that fail to delineate exchanges in Gold.

If we know the price of Gold at any given moment, why would anyone sign a futures contract based on dollars or the euro? Or any fiat currency for that matter? Why not sign the contract based on Gold, but agree to exchange in dollars per micro-ounce? We peg contractual interest rates to LiBOR, so why not peg to GoldPrice or Kitco? In the advanced electronic "all digital all the time" world we live in, this is easy. Any iPhone or Android could do it using a simple app that can convert a scanned or typed in fiat-amount (name the currency) to the real time fiat-exchange rate of Gold. Want to check your bank account or equity holdings? Simply convert any fiat currency to the price of Gold in that currency, and you know exactly where you stand in this world. Want to buy merchandise or contract for a service, or agree to provide a contractual service? Price it in Gold and the currencies will take care of themselves. The trick is in an easy to use app that has access to real-time Gold prices, and can express amount in easy to handle Gold denominations. For example, 1 florian = 1/100 th of an ounce of Gold. 1 tam = 1/1000 of an ounce of Gold.

Take this one step further. Imagine there are at least seven Gold-Bank and Reserves (GBR's) now operating on the Isle of Man. These "banks" hold real gold reserves to back member accounts. The reserves might be in a Canadian vault, or they might represent a future obligation and claim, but the members of the Gold Reserve are the owners of record. Let's imagine that a new member signs up for an account with $1 Million in fiat-dollars. The conversion to Gold is made for that new account @ the current "real-time" value of $1368.26 per oz. From this point on, it doesn't matter what currency is used for trades, exchanges and withdrawals. There are 1368.26 million ounces of Gold on account. Our conversion apps take care of the details.

The key here is that conversion information is in real time, the market for Gold is transparent, and the mechanism for accounting in Gold is trusted.

Take this defacto Gold standard and reserve system one step further. Hook PayPal into our seven Gold reserve banks on the Isle of Man. Provide a micro ounce language for Gold using known units like guilders, florians, lius and tams. Then turn the populace loose on the Web with iphone and android apps that speak Gold and can make real time electronic exchanges in the purchase of goods and services based on the convergence of QR scanning, PayPal exchange, and a GPS-Open ID with QR Biometric Chop identity authentication.

We're not there yet, but the gap between vision and reality is closing fast. The important thing to note is that money is trust. And nothing is more trustworthy than Gold. It's inflation proof. It's deflation proof. It's immune to currency fluctuations, but pity the fool who pegs their currency to it. It's politically untouchable. And, Gold is money if we "individually" decide to make it so. There is no need to consult with governments, nations, international banking consortia, or even those we trade and exchange with. Gold is money the moment you decide to think in terms of Gold. Fiat currency is simply how you choose to speak to others. Real time conversion/evaluation information and Gold Web apps make your Gold think practical.

Commodities, goods and services will always fluctuate. But if they are measured in Gold instead of other commodities or fiat currencies, the real value of contracts and exchanges can not be obscured, rigged or played. This only problem with Gold has been that of universal access to real time trading information, a transparent and trusted marketplace, and the lack of digital units, digital accounting mechanisms and digital-to-real reserves. Otherwise Gold is inevitable.

I wonder how much Gold the US Treasury and Federal Reserve has on hand? Today, at this very moment, it would take $1367.08 USA to purchase a 1 oz. Gold Reserve Note (100 florians) from an Isle of Man Gold-Bank. That's a bottom line i'll take into the voting booth next month.

An individual or corporation might deal with the world in dollars. But if they measure everything in terms of Gold, for sure, they won't get fooled again.

~ge~

Gold, gold-reserve, gold-currency, robert-mundell, milton-friedman

<div class="cArrow"> </div><div class="cContentInner">Dear WSJ Moderator, I tried to post a comment to the community forum for the article, "Currency Chaos; Where do we go from here?" My comments were rejected with the error message, "The language you used does not comply with community standards. Please re-enter." I read through my post, as well as the community rules for posting, and i can't find anything objectionable or contrary to the rules for posting? What gives? Would you please be so kind as to explain to me the problem with my language? Thanks for the consideration, ~ge~ Comment: The world is on the Gold standard. Always has been. The difference is that some people know this, and others don't. Politicians, bankers and world traders prey on those who don't know this. Signing on to a dollar denominated contractual obligation or interest rate is reckless playing the predators game. The idea of a fixed-exchange between the dollar and euro is okay. But the idea of fixing either the dollar or the euro to Gold is nonsense. Sorry Mr. Mundell, Milton was right. Fiat currencies must float against the value of Gold; just as commodities, services and goods must also float against Gold. Gold is a way of thinking. It's also the viewpoint that changes everything, even though the opportunity for this Gold view comes to us courtesy of advancing Web technologies and the connective power of pocket devices capable of universal access and exchange. Having the Internet in your pocket is the power to think in terms of Gold instead of dollars. Or any other fiat currency for that matter. Many will ask, "Why now?" Others will ask, "Why gold?" Well, Gold is elemental and about as constant in value as anything mankind has ever known. Sure, a gold rush here and there can set off a frenzied bubble of effort. But when has the supply of gold ever diminished the demand? Besides, how would you measure that except through the use of other precious metals, vital commodities or volatile currencies. My guess is that the value of Gold would be stable beyond even the most advanced algorithms precisely because the alchemy of uncertainty that pervades the value of everything else exceeds that of Gold. But why now? The problem i think has always been that of real time information and a transparent marketplace where the value of any currency, commodity or trade exchange unit can be evaluated against Gold - in real time. I suggest that today the electronic mechanisms, networking and devices are in place to use Gold as a real-time currency, but most people choose to live in the past. Or they are in on some predatory obfuscation scam based on insider undervaluing or over valuing fiat currencies. The worst case being the skewering of unwitting contractual obligations that fail to delineate exchanges in Gold. If we know the price of Gold at any given moment, why would anyone sign a futures contract based on dollars or the euro? Or any fiat currency for that matter? Why not sign the contract based on Gold, but agree to exchange in dollars per micro-ounce? We peg contractual interest rates to LiBOR, so why not peg to GoldPrice or Kitco? In the advanced electronic "all digital all the time" world we live in, this is easy. Any iPhone or Android could do it using a simple app that can convert a scanned or typed in fiat-amount (name the currency) to the real time fiat-exchange rate of Gold. Want to check your bank account or equity holdings? Simply convert any fiat currency to the price of Gold in that currency, and you know exactly where you stand in this world. Want to buy merchandise or contract for a service, or agree to provide a contractual service? Price it in Gold and the currencies will take care of themselves. The trick is in an easy to use app that has access to real-time Gold prices, and can express amount in easy to handle Gold denominations. For example, 1 florian = 1/100 th of an ounce of Gold. 1 tam = 1/1000 of an ounce of Gold. Take this one step further. Imagine there are at least seven Gold-Bank and Reserves (GBR's) now operating on the Isle of Man. These "banks" hold real gold reserves to back member accounts. The reserves might be in a Canadian vault, or they might represent a future obligation and claim, but the members of the Gold Reserve are the owners of record. Let's imagine that a new member signs up for an account with $1 Million in fiat-dollars. The conversion to Gold is made for that new account @ the current "real-time" value of $1368.26 per oz. From this point on, it doesn't matter what currency is used for trades, exchanges and withdrawals. There are 1368.26 million ounces of Gold on account. Our conversion apps take care of the details. The key here is that conversion information is in real time, the market for Gold is transparent, and the mechanism for accounting in Gold is trusted. Take this defacto Gold standard and reserve system one step further. Hook PayPal into our seven Gold reserve banks on the Isle of Man. Provide a micro ounce language for Gold using known units like guilders, florians, lius and tams. Then turn the populace loose on the Web with iphone and android apps that speak Gold and can make real time electronic exchanges in the purchase of goods and services based on the convergence of QR scanning, PayPal exchange, and a GPS-Open ID with QR Biometric Chop identity authentication. We're not there yet, but the gap between vision and reality is closing fast. The important thing to note is that money is trust. And nothing is more trustworthy than Gold. It's inflation proof. It's deflation proof. It's immune to currency fluctuations, but pity the fool who pegs their currency to it. It's politically untouchable. And, Gold is money if we "individually" decide to make it so. There is no need to consult with governments, nations, international banking consortia, or even those we trade and exchange with. Gold is money the moment you decide to think in terms of Gold. Fiat currency is simply how you choose to speak to others. Real time conversion/evaluation information and Gold Web apps make your Gold think practical. Commodities, goods and services will always fluctuate. But if they are measured in Gold instead of other commodities or fiat currencies, the real value of contracts and exchanges can not be obscured, rigged or played. This only problem with Gold has been that of universal access to real time trading information, a transparent and trusted marketplace, and the lack of digital units, digital accounting mechanisms and digital-to-real reserves. Otherwise Gold is inevitable. I wonder how much Gold the US Treasury and Federal Reserve has on hand? Today, at this very moment, it would take $1367.08 USA to purchase a 1 oz. Gold Reserve Note (100 florians) from an Isle of Man Gold-Bank. That's a bottom line i'll take into the voting booth next month. An individual or corporation might deal with the world in dollars. But if they measure everything in terms of Gold, for sure, they won't get fooled again. ~ge~ Gold, gold-reserve, gold-currency, robert-mundell, milton-friedman</div>

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