The gold standard

[J_Lannon]

I have been doing some research, and reading alot of economists articles about going back to the "gold standard". What do you guys think? Y'all think it would work in todays global economy?

[Dogg Fish]

It absolutely couldn't work, though some would argue that it is a good idea because it would restrain the government from offering up zillions of dollars every time they feel like bailiing out a company. The gold standard means that every dollar in circulation (not just paper dollars but also electronic bank balances) has to be backed by that same valuation of gold. Since we don't have that constraint, the government just, in effect, prints money (or, equivalently, creates bank balances) whenever they feel like spending more than they're getting in taxes from us. Congress would never go for a gold standard, even the Republicans.

[sprtsracer]

It absolutely couldn't work, though some would argue that it is a good idea because it would restrain the government from offering up zillions of dollars every time they feel like bailiing out a company. The gold standard means that every dollar in circulation (not just paper dollars but also electronic bank balances) has to be backed by that same valuation of gold. Since we don't have that constraint, the government just, in effect, prints money (or, equivalently, creates bank balances) whenever they feel like spending more than they're getting in taxes from us. Congress would never go for a gold standard, even the Republicans.

The Price of gold FLUCTUATES...AND THE HISTORY IS NOT GOOD!!!

[inshoreangler95]

It absolutely couldn't work, though some would argue that it is a good idea because it would restrain the government from offering up zillions of dollars every time they feel like bailiing out a company. The gold standard means that every dollar in circulation (not just paper dollars but also electronic bank balances) has to be backed by that same valuation of gold. Since we don't have that constraint, the government just, in effect, prints money (or, equivalently, creates bank balances) whenever they feel like spending more than they're getting in taxes from us. Congress would never go for a gold standard, even the Republicans.

Very well put Dogg Fish! I couldnt agree more!