DBWI: The United States off the Gold standard?

What if the United States was taken off the gold standard? How would this effect the American and Global ecomonies?
 
And have a currency tied to nothing, yeah right. Greece has been able to print the Drachma as much as they want, and its gotten so bad there they've degraded to a system of barter.
 

RousseauX

Donor
The problem with the gold standard is simply that it doesn't work particularly well with an expanding economy. Since the value of the US currency was fixed to gold at $35/ounce decades ago it means that the actual amount of gold in the world isn't enough to cover the volume of international trade on a yearly basis (since that would be in effect conducted in gold and the value of everything traded besides gold will be far higher). This retards trade and what's more essentially mandates monetary contraction to even temporary trade deficits. Which basically means that recessions become a scarily common phenomena, and is an intended consequence of the gold standard in the first place since it causes internal devaluation which will theoretically bring the trade deficit back to balance. In practice though it's not socially acceptable and results in lots of pissed off people demanding an independent monetary policy in order to get people back to employment.\

Of course it also depends on exactly what we are talking about here, are we talking about the Bretton Wood system or the gold standard beforehand?
 
The Gold Standard debates here in GB were the beginning of the process that culminated in the Revolution, so whatever you do, be careful how you do it! :D
 
a silver standard would be optimal - there's simply not enough gold around.

going off a standard is no option. no one wants the dollar to become a lira. if people saw the government born down all their private savings there would be an uprising. people are nit that stupid to stand for a currency backed by promisses and paper.:(
 
a silver standard would be optimal - there's simply not enough gold around.

going off a standard is no option. no one wants the dollar to become a lira. if people saw the government born down all their private savings there would be an uprising. people are nit that stupid to stand for a currency backed by promisses and paper.:(

The People's Pound has been doing just fine since 1946, thank you very much. Mind you, until then it was backed up by land, and the massive reparations we got from the Volksrepublic helped a great deal.

It's a long-standing legend that Benn floated a 'coal standard' to some of his closest allies in the 80s after the Bordeaux Collapse and the ensuing recession. Thankfully, cooler heads prevailed!
 
a silver standard would be optimal - there's simply not enough gold around.

going off a standard is no option. no one wants the dollar to become a lira. if people saw the government born down all their private savings there would be an uprising. people are nit that stupid to stand for a currency backed by promisses and paper.:(

Gold & silver, another judgement of value which have less intrinsic value than authority backed by an army, laws, & at least a minority of the society.

And have a currency tied to nothing, yeah right. Greece has been able to print the Drachma as much as they want, and its gotten so bad there they've degraded to a system of barter.

Clearly countries on the Gold Standard never screw up, don't mix different subjects here. There is no fail-safe against poor governance.
 
What if the United States was taken off the gold standard? How would this effect the American and Global ecomonies?

IC: What Gold Standard? They've been shifting the goal-post since the late 80's every few months or so, to the point that the markets have more or less learnt to compensate and anticipate each change in rates.

OOC: I think there's quite a few people forgetting their OOC tag here....
 

RousseauX

Donor
a silver standard would be optimal - there's simply not enough gold around.
It makes no real difference since governments simply declare what the value of their currency relative to precious metal is under the gold standard, the problem is that since the world economy and trade grows, what will cover the volume of trade today will not do so in 10 years. Unless the government can constantly revalue their currency relative to gold/silver, but if that's the case, will you might as well as have fiat currency.
 

RousseauX

Donor
It's a long-standing legend that Benn floated a 'coal standard' to some of his closest allies in the 80s after the Bordeaux Collapse and the ensuing recession. Thankfully, cooler heads prevailed!
An oil standard would frankly make more sense.
 
An oil standard would frankly make more sense.

Aye, but while the Kirovites in the Union of Secular Palestinian Republics control more oil than the British Bloc, I don't see us signing up for that.

A bit of central planning is all you need to keep a paper currency going - you yanks should try it sometime!
 
Aye, but while the Kirovites in the Union of Secular Palestinian Republics control more oil than the British Bloc, I don't see us signing up for that.

A bit of central planning is all you need to keep a paper currency going - you yanks should try it sometime!

I used to be in favor of abandoning the gold standard. My support for that has rapidly eroded in the past few years though. The various financial scandals worry me. With nothing of substance to connect a currency to, money can be made from nothing.

A shining example are the collapse of the complex derivatives markets. Large amounts of so-called wealth created from what exactly? Even those who created these derivatives are unable to explain how this wealth was created.

Another example, nearer and dearer to people here. The virtual money scandals of Second Life and World of Hackcraft. Virtual money was earned through the looting, production, and sale of imaginary items. These game currencies became the same as real life currencies to some players. People bought and sold real life items using this imaginary currency. Trading markets were even set up. And then what happened? KA-BOOM! Cold hard reality set in.
 
It would probably greatly strengthen the economy. Of course, I can't see it happening until President Paul leaves office.

Former President Ron Paul may have been all for the gold standard, but President Les Paul (Jr.) is toying with the idea of a silver standard. To be fair, the gold standard worked when Ron was in office, but that was over 20 years ago, after the war. All the changes that Nader did after Paul left office really made it so gold wasn't a viable option any more.

OOC: Now this thread is even more confusing!
 
An oil standard would frankly make more sense.

UGH! And give OPEC partial control over your nation's monetary policy?

But on the other hand we Canadians also get a slice of that monetary policy.

Besides, oil is way too volatile in both demand and supply for a good store of value.
 
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