The US went from being GOLD STANDARD ------to NIXON-ERA FIAT MONEY -------in time for second ROBBER BARON sacking and looting during CLINTON/BUSH/OBAMA. This is what allowed OBAMA- era $20 TRILLION in national debt during OBAMA era.
This is why today we have the discussion of ENDING FIAT MONEY ------below we see the same FAR-RIGHT WING GLOBAL BANKING 1% tied to ending GOLD STANDARD after the economic collapse of ROARING 20s ---now telling us not to return to GOLD STANDARD----they are global banking 1% neo-liberals at UNIVERSITY OF CHICAGO----and they support COMMODITIES-BASED economics------which is what all those LATIN AMERICAN nations several decades ago installed after their sovereign economy was brought to COLLAPSE by GLOBAL BANKING 1%.
'In a University of Chicago poll this year, not one of 40 top economists surveyed supported a return to gold'.
Since the US is captured by far-right global banking 1% both REPUBLICAN AND DEMOCRATIC PARTIES---and the FAKE 'LEFT' OUR REVOLUTION players-----there is no real discussions of returning to GOLD STANDARD---the RON PAUL LIBERTARIANS are the same neo-liberals as CLINTON/BUSH/OBAMA MOVING FORWARD commodities-based economics.
RON PAUL AS A LIBERTARIAN IS SIMPLY NEO-LIBERALS MORPHING INTO FAR-RIGHT WING HITLER/STALIN/MAO EXTREME WEALTH GLOBAL CORPORATE MARXISM.
Hmmmm, that's the same as the OUR REVOLUTION crowd of BERNIE SANDERS----that's right. They are all working for WORLD BANK/IMF taking the US to colonial commodities-based market.
WHY ARE COMMODITIES MARKETS BAD FOR SOVEREIGN NATIONS BROUGHT UNDER WORLD BANK/IMF CONTROL?
Because the economic reforms brought fill those nations with FOREIGN ECONOMIC ZONES-----with foreign global corporations as the only economy. Ergo, commodities market is controlled by only the global 1%------
Why Did the U.S. Abandon the Gold Standard?
BY The Week
October 5, 2012
Some have called for a return to the gold standard. How would it affect the economy?
What is the gold standard?It’s a monetary system that directly links a currency’s value to that of gold. A country on the gold standard cannot increase the amount of money in circulation without also increasing its gold reserves. Because the global gold supply grows only slowly, being on the gold standard would theoretically hold government overspending and inflation in check. No country currently backs its currency with gold, but many have in the past, including the U.S.; for half a century beginning in 1879, Americans could trade in $20.67 for an ounce of gold. The country effectively abandoned the gold standard in 1933, and completely severed the link between the dollar and gold in 1971. The U.S. now has a fiat money system, meaning the dollar’s value is not linked to any specific asset.
Why did the U.S. abandon the gold standard?
To help combat the Great Depression. Faced with mounting unemployment and spiraling deflation in the early 1930s, the U.S. government found it could do little to stimulate the economy. To deter people from cashing in deposits and depleting the gold supply, the U.S. and other governments had to keep interest rates high, but that made it too expensive for people and businesses to borrow. So in 1933, President Franklin D. Roosevelt cut the dollar’s ties with gold, allowing the government to pump money into the economy and lower interest rates. “Most economists now agree 90 percent of the reason why the U.S. got out of the Great Depression was the break with gold,” said Liaquat Ahamed, author of the book Lords of Finance. The U.S. continued to allow foreign governments to exchange dollars for gold until 1971, when President Richard Nixon abruptly ended the practice to stop dollar-flush foreigners from sapping U.S. gold reserves.
Why is gold in debate again?
Libertarian Rep. Ron Paul (R-Texas) made a return to “honest money” a key plank of his presidential run, and the idea took hold among Tea Party conservatives outraged over the Federal Reserve’s loose monetary policies since the financial crisis. They argue that the U.S. debt now exceeds $16 trillion because the government has become too cavalier about borrowing and printing money. When the Fed prints money, gold-standard advocates say, it cheapens the value of a dollar, promotes inflation, and effectively steals money from the citizenry. In a nod to those ideas, the Republican Party’s 2012 platform calls for the creation of a commission to investigate setting a fixed value for the dollar. The gold standard “forces the U.S. to live within its means,” said investment strategist Mark Luschini. “Think of it as a person with a debit card rather than a credit card. The debit card holder can only spend what he or she has in the bank.”
What are the downsides?
A fixed link between the dollar and gold would make the Fed powerless to fight recessions or put the brakes on an overheating economy.
“If you like the euro and how it’s been working, you should love the gold standard,” said economist Barry Eichengreen. Beleaguered Greece, for instance, cannot print more money or lower its interest rates because it’s a member of a fixed-currency union, the euro zone. A gold standard would put the Fed in a similar predicament. Gold supplies are also unreliable: If miners went on strike or new gold discoveries suddenly stalled, economic growth could grind to a halt. If the output of goods and services grew faster than gold supplies, the Fed couldn’t put more money into circulation to keep up, driving down wages and stifling investment.
Could the gold standard come back?
It’s very unlikely. In a University of Chicago poll this year, not one of 40 top economists surveyed supported a return to gold.
The last gold standard commission, established by President Ronald Reagan, voted by a wide margin against bringing it back. The size and complexity of the U.S. economy would also make the conversion extremely difficult. Just to back the dollars now in circulation and on deposit—about $2.7 trillion—with the approximately 261 million ounces of gold held by the U.S. government, gold prices would have to rise as high as $10,000 an ounce, up from about $1,780, causing huge inflation. “It could do massive damage to the economy,” said John Makin, an economist at the American Enterprise Institute. So why the clamor for its return? Nostalgia, said economist Charles Wyplosz. “People long for a simpler age,” when the U.S. “was the dominant economy and there were no financial markets to speak of.” It’s like “getting back together with that old girlfriend,” said MarketWatch’s David Weidner. The current system may not be perfect, he says, but what people forget is that “the gold standard never works.”
All nations taken to FOREIGN ECONOMIC ZONE status these several decades fueled by continuous wars and civil unrest ended by having WORLD BANK/IMF declare those economies-----COMMODITIES-BASED as FOREIGN ECONOMIC ZONES replace local domestic economies.
This placed those once SOVEREIGN NATIONS into a colonial control-----global banking and global corporations as the only ECONOMIC STRUCTURE. The commodities coming from these nations were TRIBUTE STATE----NATURAL RESOURCES---exporting all minerals/metal ores-----much like AFRICA has been as a colonial entity.
COMMODITIES-BASED economies when on GOLD STANDARD limited economic development to what a sovereign government could spend in actual monetary wealth---AKA GOLD. Therefore, these GOLD STANDARD economies were STABLE and civil societies lasted for centuries.
COMMODITIES-BASED economics controlled by global banking 1% and WORLD BANK never last ---are not stable because that is how colonialism WORKS.
Below we see why global banking 1% WORLD BANK took Argentina/Chile/Peru to a commodities-based economy-----just as is MOVING FORWARD today in US FOREIGN ECONOMIC ZONES.
'Argentina is rich in energy, metals, and minerals'
AND------these economies became GLOBAL BIG AG GLOBAL BIG MEAT.
'Agricultural products dominate exports'
Argentina Is A Commodities-Based Economy
Feb. 7, 2018 9:13 AM ET
The South American country has a long history with a volatile economy.
Agricultural products dominate exports.
A big animal protein producer.
Argentina is rich in energy, metals, and minerals.
In a commodities boom, Argentina should thrive - ARGT could act as a commodities proxy.
This idea was discussed in more depth with members of my private investing community,Hecht Commodity Report.
The economy of Argentina is the second largest in South America behind Brazil. The capital city, Buenos Aires, has a particular European flare. The official language is Spanish, but it differs from the Spanish spoken in Spain. In many ways, it sounds more like Italian, another romance language. When walking down the street in Buenos Aires, it is common to hear people conversing in Italian, German, English, and French, making the city a cosmopolitan world capital.
Argentina is a nation rich in natural resources. Located in the southern hemisphere, Argentina is one of the world’s leading agricultural commodities producing countries. Along with Brazil and several other neighbors, Argentina’s crop and animal protein production mean that the crop season operates throughout the year. Additionally, mining and energy extraction are growing businesses in the country that is a significant exporter of its natural resources. In 1913, Argentina was the tenth wealthiest nation on a per capita basis because of its fertile land. Its growth at the beginning of the twentieth century attracted many Europeans to settle in the South American country. However, today it ranks around fifty-fifth of 185 countries according to the World Bank, and that is because of its volatile political and economic history. In many ways, Argentina is a commodities-based economy, and its economy tends to improve and worsen with raw material prices.
The South American country has a long history with a volatile economy
Massive levels of foreign debt interest payments, tax evasion, and capital flight plagued the economy of Argentina from 1975-1990. The country suffered from a bout of hyperinflation in 1989 and 1990. In 1991, Argentina pegged its currency to the U.S. dollar to achieve economic stability which lasted for around one-half decade. The country’s dependence on short-term capital and debt to maintain its overvalued fixed exchange rate caused erratic GDP growth from 1995 through 2001 when the economy suffered a collapse. In 2002, Argentina defaulted on its debt, its GDP declined by almost 20%, and unemployment reached 25%. After floating their currency, the peso depreciated by 70%. However, the economy began improving in 2003, around the same time commodities prices started moving higher. The size of the economy almost doubled from 2002 through 2011, growing by an average rate of 7.1% each year and by 9% from 2003 through 2007. The growth in the economy of the South American nation was parallel to the rise in raw material prices during the period.
Agricultural products dominate exports
Argentina ranks in the world’s top ten producers and exports of citrus fruits, grapes, honey, maize (CORN), sorghum, soybeans, squash, sunflower seeds, wheat, and yerba mate.
Soybeans and its products (soybean meal and oil) are significant exports for Argentina. Other exports include fruits and vegetables, cotton, tobacco, sugarcane, chili peppers, olives, and garlic. The demand for organic farming has caused Argentina to expand production to over 8 million acres of organic cultivation, second only to Australia which has increased its position in the export market as global demand continues to rise.
A big animal protein producer
While Argentina is also a big producer of cattle, the nation is also one of the leading beef-consuming countries in the world. However, rising world demand is likely to increase Argentina’s role in the export market in the future. A recent report from CoBank said that 80% of beef exports go to countries that could be impacted by ongoing trade pact negotiations. When it comes to NAFTA, the Trans-Pacific Partnership, and the U.S.-Korea Free Trade Agreement, the U.S. is currently either renegotiating or has dropped out of agreements entirely. Uncertainty about the future of trade given the Trump Administrations pivot to bilateral, rather than multilateral agreements could increase demand for beef from other producing nations.
The U.S. is the world’s leading beef producer. Demand is growing for the animal proteins around the globe. Increasing population and wealth have resulted in dietary changes that include more complex proteins like beef, poultry, and pork. While U.S. beef manufacturers look to China as a long-term opportunity for exports, U.S. tariffs on other Chinese goods could cause the world’s most populous nation to turn to other sources of supply for beef and other proteins. Brazil, Argentina, and Australia will look to increase their exports of beef in the future and Argentina has a reputation for some of the world’s highest quality beef.
Argentina is rich in energy, metals, and minerals
As a significant producer of agricultural products, Argentina’s role in the biofuel industry and its exports of ethanol has been rising. Its gas and oil extraction businesses are also increasing over recent years. The South American country is self-sufficient when it comes to oil and oil products, natural gas, as well as coal production and exports are rising. Pipelines, the second most extensive network in Latin America next to Mexico, send the energy commodities to areas in the industrial belt which is the center of the petrochemical industry.
Argentina is also rich in copper, lead, magnesium, sulfur, tungsten, uranium, zinc, silver, titanium, and gold and exports have been rising since the mid-1990s.
In a commodities boom, Argentina should thrive - ARGT could act as a commodities proxy
The economic future of Argentina is, in many ways, tied to the direction of commodities prices. In a commodities bull market, the economy of the South American country, along with Brazil, will likely experience a boom. Therefore, it is likely that the Argentine stock market will act as a commodities proxy in the future. ARGT is the Global X MSCI Argentina ETF product that replicates the performance of the MSCI All Argentina 25/50 index. The fund invests at least 80% of total assets in securities of the underlying index and ADRs and seeks to reflect the performance of Argentina’s broad equity index.
At the end of 2015 and in early 2016, many commodities prices fell to multiyear lows and put in significant bottoms. Since then, they have appreciated as many sectors of the commodities market have experienced a bullish resurgence.
It was NIXON-era FIAT MONEY policy that took a strong US domestic food commodity economy to being that same GLOBAL BIG AG GLOBAL BIG MEAT as LATIN AMERICAN---CHILE for example.
LEAVING THE GOLD STANDARD AND TYING TO FIAT MONEY-----AND MAKING EVERYTHING A GLOBAL COMMODITY---AS OUR UTILITIES----ENERGY----AS OUR FOOD-----THEN OUR HEALTH AND EDUCATION ----IS WHY THE US IS RANKED A FAILED NATION----THIRD WORLD.
From GOLD STANDARD----to FIAT MONEY--------now global banking 1% want to officially install COMMODITIES-BASED economy.
So, is a COMMODITIES-BASED Economy really HYPER--INFLATION----PROOF? Of course not.
Why a commodities market after a FIAT market which replaced the GOLD STANDARD? Because the US is being stripped of all its natural resources-----which is where sovereign nations taken by HYPER-INFLATION end ------
a TRIBUTE STATE colonialism ------courtesy global 1% OLD WORLD KINGS.
WORLD BANK/IMF is global banking 1% OLD WORLD KINGS wanting to keep extreme wealth extreme power-------and CLINTON/BUSH/OBAMA ---now TRUMP are global banking 1% OLD WORLD KINGS PLAYERS. Staging the US for economic collapse since 2008 Bernanke US FED-----meets US TREASURY -----is simply doing to the US what was done overseas when FOREIGN ECONOMIC ZONES took sovereign national economies and handed them to GLOBAL BANKING 1% ---OLD WORLD KINGS. So, Latin American economies handed to SPANISH OLD WORLD KINGS------Asian economies handed to CHINESE OLD WORLD KINGS.
So, the goal of CLINTON/BUSH/OBAMA is taking the US from FIAT MONEY------used to stage ROBBER BARON sacking and looting----to COMMODITIES-BASED -----NOT GOLD STANDARD because the goal is COLONIALISM-----stripping our US of natural resources and replacing our US domestic economy with GLOBAL FOREIGN CORPORATIONS.
'Steve H. Hanke is a Professor of Applied Economics and Co-Director of The Johns Hopkins Institute for Applied Economics, Global Health, and the Study of Business Enterprise. He is a columnist at Forbes Magazine, a well-known currency reformer, and a currency and commodity trader'.
Below we see the same global banking NEO-LIBERAL ECONOMISTS telling us our currencies are TROUBLED-----ergo, they have the answer. Just do to US what was done overseas in Latin America---in Asia ---filling the economies with global multi-national corporations operating under FOREIGN ECONOMIC ZONE trade policies.
In other words----KILL ALL THAT IS SOVEREIGN US GOVERNANCE, ECONOMY, AND 300 YEARS OF US CONSTITUTIONAL HISTORY.
'Professor Steve Hanke Explains Hyperinflation
Steve H. HankeJeff Deist
Steve Hanke, professor of economics at Johns Hopkins and head of Cato's Troubled Currencies Projects, is an Austrian—but he's an Austrian who looks at markets first and foremost. He also thinks QE was the right thing for the Fed to do in 2008, Austrians are all wrong to focus on the Fed's balance sheet instead of the M4 "broad money" supply, and US debt is a more distant worry than the risk posed by Trump's tariffs'.
The article below does a very good job in explaining why the US should be RETURNING to GOLD STANDARD and why COMMODITIES-BASED structures are not what global banking 1% says they are-----Notice HANKE is tied to CATO INSTITUTION-----which is think tank thinking like pre-Christian CATO/NERO/SENECA.
'it is inferior to a gold standard system. That’s why gold standard systems were found around the world, and worked beautifully'
HANKE of CATO saying commodities-based economies are not effected by HYPER-INFLATION------well, that is about as FAKE as these positive stances on very, very, very bad WORLD BANK policies.
Jan 26, 2012, 05:45pm
Does A Commodity Basket Standard Measure Up To Gold
Economics & Finance I write about monetary and tax policy for the 21st century.
I taunted you last week to try to come up with a better system than a gold standard system, for attaining our goal of stable value. Not so easy, is it?
One idea that has been bouncing around for many years is the “commodity basket” idea. I don’t think today’s commodity basket advocates consider it original, but I wonder if they know just how long it has been around.
The economist William Stanley Jevons wrote a book about it in 1875, called Money and the Mechanism of Exchange. In the book, Jevons himself writes about the history of the idea:
Among valuable books, which have been forgotten, is to be mentioned that by Joseph Lowe on "The Present State of England in regard to Agriculture, Trade, and Finance," published in 1822. … In Chapter IX. Lowe treats, in a very enlightened manner, of the fluctuations in the value of money, and proceeds to propound a scheme, probably invented by him, for giving a steady value to money contracts. He proposes that persons should be appointed to collect authentic information concerning the prices at which the staple articles of household consumption were sold.
People have held the idea for centuries that gold is a standard of stable value. Probably every culture has used some other commodity at some point, whether it be wheat, copper, cocoa beans and so forth. Warehouse receipts for tobacco were used as money in colonial Virginia. However, all of these systems were later abandoned for ones based on gold. This happened in Europe, in Asia, in Africa, and, to some extent, even in the pre-Columbian Americas.
We should respect this outcome generated from centuries of experience, not some coffeehouse debate.
However, people naturally want to see what evidence there is of gold’s stability. As I have mentioned, this is quite difficult, since if there were some definitive benchmark of value that was superior to gold, against which gold could be measured, we would use that as a standard of value instead of gold.
Most of the commodity basket fans seem to mistake the value and the so-called purchasing power of gold, assuming they are one and the same. Last week we discussed how these ideas are very different. This is obvious if you think about it. The purchasing power of $100 in Manhattan is much less than the same $100 in Ecuador. However, on the same day, the value of $100 is the same in both places. The $100 didn’t change.
If you compare gold to a basket of commodities, going back to about 1500 in Britain, we find that the “price of commodities” in gold is remarkably stable. However, commodities prices go up and down in the short term, related to the “supply and demand for commodities” as Ludwig Von Mises would say. In other words, if the weather is bad, we would expect prices to rise, when measured in a currency of stable value, and when there is a surplus of commodities perhaps due to a bountiful harvest, we would expect prices to fall.
If we just considered gold to be perfectly stable in value – a rather overambitious assumption – we would expect to see something much like the actual historical record, of commodities prices going up and down somewhat. Most of the variation is closely related to wars, for reasons you can imagine.
The commodities basket fans often assume that their commodity basket is a perfectly unchanging measure of value (or “purchasing power” since they commingle the two). Thus, any deviation of price is assumed to be a variation in gold’s value/purchasing power. Once you begin with this flawed assumption, you end up with two conclusions: first, that gold’s value/purchasing power seems quite unstable, and second, that a commodity basket is superior, because we have assumed beforehand that it is a representation of stable “purchasing power.”
This is barely more than a self-contained tautology.
One of the reasons that a commodities basket is used is, quite simply, because that is what we have data for. Today’s “consumer price index” is really a product of the 1940s. There were a few precursors back to 1920, but before then, the only long-term data we have is commodity price data. Thus we have another assumption, that this rather limited selection of agricultural commodity prices (energy and metals were less prominent then) somehow represents the “purchasing power” of a currency.
What commodity prices?
Every commodity that is not an atomic element has different grades and types. Brent, Tapis Light, West Texas intermediate, or Saudi Heavy? And where do we measure these prices? Especially in the days when overland travel was done by horse-drawn cart, the price of wheat in New York could be radically different than the price of wheat in Ohio, due to differing weather conditions and so forth. Goods are often subject to tariffs and so forth. Even today, the price of wheat in Kansas can be quite different than the price in Kiev, the world’s other “breadbasket.”
In other words, you could have the same basket, with the same weightings, and the “value” would be different in New York, London, Beijing and so forth. This is true today, and especially in 1845.
Would this commodity basket change over time? Who would make the decisions? Would other countries use the same basket, or a different one? Would their baskets change too? What would this do to the exchange rates between their currencies? Would that be good for business?
I could go on with many other criticisms, but I will leave that for you for now. It is a good mental exercise. I will add one thing, though: this confusion between “value” and “purchasing power,” especially as related to agricultural commodities, has in the past often had a certain agenda. The agenda is not to create a currency of stable value, but rather to create a framework of currency manipulation.
In the not-so-distant past, the majority of Americans, like the majority in other countries, were farmers. Naturally, any time that commodities prices declined, farmers’ businesses became more difficult. Many farmers were in debt.
One solution was to devalue the currency. The nominal price of agricultural commodities would tend to rise, thus bringing them back to a profitable nominal level, and allowing farmers to discharge their debt obligations. However, using the word “devaluation” has never been popular. Even today’s Keynesians avoid it. You could instead argue that the devaluation was necessary to “correct the rise in the purchasing power of gold.” This might seem somewhat silly, but these sorts of arguments were popular in the 1890s, when the U.S. threatened to devalue the dollar in response to a huge glut of commodities related to the expansion of railroads.
The Keynesians today have a somewhat more abstract, but similar, way of doing things. During a recession, prices tend to fall. When the situation is really bad, as it was in 1930-33, prices can fall a lot. Debtors face bankruptcy. The Keynesians are ready to counteract this natural decline in prices with what amounts to currency devaluation, thus preserving “price stability.” Ben Bernanke makes these sorts of arguments today.
The commodity basket idea has some good elements, but in the end, it is inferior to a gold standard system. That’s why gold standard systems were found around the world, and worked beautifully, while commodity basket pegs remained an intellectual exercise in forgotten books. The gold standard system worked so well, that there wasn’t really any problem that needed to be fixed with the introduction of another system. Many such arguments are really rather subtle justifications for money manipulation in the face of recession.
We will end this week's discussion of economic public policy by stating the OBVIOUS--------these few decades of CLINTON/BUSH/OBAMA---now TRUMP global neo-liberal economic policies have been filled with NOTHING BUT LYING, CHEATING, AND STEALING------so, why would we believe the same people telling us a WORLD BANK/IMF COMMODITIES BASED standard is better and that this standard protects against HYPER-INFLATION found every time global banking 1% SACKS AND LOOTS a sovereign nation and brings those nations into WORLD WARS-----as is MOVING FORWARD WW3?
The answer is this----WE DON'T BELIEVE HANKE -------
Which is the big reason I am currently being 'HIT' and made PORN with illegal surveillance inside my apartment-----well, there is that black market MONEY being made by NOSY NEIGHBORS AND THE GANG----working on PUBLIC SURVEILLANCE controlled by HOMELAND SECURITY----tied to global hedge fund JOHNS HOPKINS and global private military corporations owned by global banking 1% OLD WORLD KINGS ----KNIGHTS OF MALTA---TRIBE OF JUDAH.
Stop MOVING FORWARD ------and prepare for what will be economic chaos worse than ROARING 20s with no intent to rebuilding an FDR capitalist economy---rather a DARK AGES 3000BC Hindi-Brahmin extreme wealth extreme poverty-----with HYPER-INFLATION leading the way.
Professor Steve Hanke Explains Hyperinflation
| Steve H. Hanke, Jeff Deist
08/24/2018Steve H. HankeJeff Deist
Steve Hanke, professor of economics at Johns Hopkins and head of Cato's Troubled Currencies Projects, is an Austrian—but he's an Austrian who looks at markets first and foremost. He also thinks QE was the right thing for the Fed to do in 2008, Austrians are all wrong to focus on the Fed's balance sheet instead of the M4 "broad money" supply, and US debt is a more distant worry than the risk posed by Trump's tariffs.
An expert on currencies and inflation, Professor Hanke joins the show to explain what's happening in places like Venezuela and Turkey. How and why do currencies fail, and how can hyperinflation be prevented without bailouts by the IMF? What can stop the vicious cycle of printing money to pay bills when no tax base exists? And what do recent past examples in Bulgaria, Russia, and Yugoslavia teach us?