That's a little bit of a leap in logic don't you think? Couldn't you just as easily say that the gold standard encourages countries to invade each other in an effort to increase their respective gold supplies?
I totally agree. Back when people wanted gold instead of paper money, governments were more civilized. When European countries went to Africa and America and Asia to colonize them, they weren't trying to start wars. They just had a "you give me your gold and I won't kill you" agreement with the locals.
Theory: If there is a gold standard, less countries go to war. Evidence: Lots of wars occurred while there was a gold standard. Hmmmmmmmmmmmm........
Gold has value whether you are on the Gold Standard or FIAT currency. Your scenario doesn't apply since it has nothing to do with being on the Gold Standard vs a FIAT currency. That's correlation not causation (actually it's not even correlation). Wars get started for lots of reasons.
The idea that we can live using the gold standard is so deeply unrealistic that I can't take a person seriously if they honestly believe in it.
Human's also used to have slavery and believed the earth was the center of the universe. All in the world as a whole is lot wealthier than ever. More people can read. More people can own cars etc.
What does that have to do with anything? Thadues claimed 'The idea that we can live using the gold standard is so deeply unrealistic' which is obviously false and stupid because we have. What does slavery have to do with anything.
Spain might have something to say about why it conquered the New World. Also, your point of gold having value without a gold standard is based on people perceiving it to hold value because it is shiny. The price of gold is many times more than its' industrial usefulness.
Gold is no longer the currency that drives the world economy. What gives any currency its value are the good/services that can be purchased with it. In that respect, gold is essentially nature's version of fiat currency. Your ability to buy anything with gold (or gold-standard currency) depends on others' faith that they too can buy something with it. Fiat essentially removes the gold middle-man, allowing the currency to be backed directly by an economy's productive output. Frankly, it was the next logical step to take for our currency.
Incorrect. FIAT currency isn't 'backed' by anything (if you want you can say it's backed by the government's word, but that's pretty weak). That's what allows a government the freedom to print as much as it desires.
People also lived in caves and as slaves. Your point is irrelevant. Of course people lived under the gold standard, but time and human history change and adapt.
It's the idea of having something to base your money off of. Right now the $ is based off of faith, really. It isn't backed up by anything and the government can just print more when it wishes. But in reality, there is no way we have enough gold in our reserves to convert back.
Did you even bother to look at the comment I was responding to? You obviously agree with me 100% that thadeus is wrong. THadeus: The idea that we can live using the gold standard is so deeply unrealistic You: Of course people lived under the gold standard
I would estimate that this is the primary issue keeping Paul's moderate supporters (like myself) away from hardcore support. If you want to learn a lot about Paul's economic stances in an easy read, check his book End The Fed. I own a copy, and this thread has reminded me to finish it.
Having studied a little into the Gold Standard as part of my econ history course, while the Gold Standard allows you long term price stability, it is wreaks havoc on short term volatility. Even back then, before information could travel very widely and quickly, gold discoveries would basically dictate that in 10 years time (because of how long it takes for the supply of gold to flood in) prices would go crazy, but would settle in the long term. This is very bad for businesses that basically have to second-guess what a new discovery of gold would do for prices. From my econ notes: While the US annual inflation between 1880-1914 was just 0.1%, and between 1946-2003 was 4.1%, the coefficient of variance for 1880-1914 was 17 which is pretty high, and for 1946-1990 it was 0.88.
