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I'm an outspoken Ron Paul supporter, and recently had a friend ask me if he was elected, would he re-institute the gold standard. I told him that he probably would since that's what he's been fighting in congress for ever since he was first elected.

But that got me to thinking and I wondered how they could actually execute that. I've heard that there isn't enough gold at the current valuation to back up the presently circulating domestic money supply, much less treasuries. So would gold go up or the money supply deflate? Seems like both would have to happen. And could he do that by executive order? What are the possibilities of him re-instituting a bimetallic standard as well? Silver coins?

Thoughts?

I doubt he would use an executive order. He has said many times that executive orders are unconstitutional, and that the only thing he would anticipate using an executive order for would be to repeal all previous executive orders

Personally I don't think it could be done. Not by one president anyways, no matter who controls the congress, because you don't hear too many republicans who support it, and we know dems don't.

I don't know about the gold standard. It would be terrific for those who hold gold and silver for the US to have Paul bring us back to Constitutional standards. If all FRN's were to be covered by the gold in Ft. Knox.... an ozt of gold would be worth something well north of $40,000!

Issuing a new dollar minted by our US Treasury would be more likely. Ending the Fed is one of Paul's major goals. Maybe people would be allowed to trade-in their green sealed (green dot) FRN's for red-sealed (red dot) Treasury bills. It is a really smart thing to do. We would no longer be borrowing FRN's at interest and save tons of money. I can imagine trading in FRN's for Treasuries at a rate of 10:1. Or even 100:1. Once again, a bonanza for PM holders!

On other issues, Paul has stated we can't turn the clock back over night. Things will have to be done gradually so as not to cause panic in the streets.

Sheikh_yer_Bu'Tay wrote:On other issues, Paul has stated we can't turn the clock back over night. Things will have to be done gradually so as not to cause panic in the streets.

Yeah, it's good to see that he is emphasizing gradual transition this time around. I remember thinking that one of his big failures in 2008 was that everyone knew he wanted a return to the gold standard, but they thought the change would be immediate and radical. He offered no actual solution for making the transition for people who only held FRN's, nor any mechanism for determining how much gold or silver it would cost to purchase, say, a loaf of bread or a six-pack of beer. Sure, the free market would take over and equilibrium would eventually be reached, but the intervening upheval and uncertainty would be untenable for most folks, and they voted defensively. If there is such a thing

I see hoarding as being the biggest problem with a slow switch to a physically backed currency. I think every member here would be guilty of it.

To get around the hoarding issue in the least disruptive way possible, they could peg a 'new' dollar to 1/50th of an ounce of gold or 1 ounce of silver. Using this method, the hoarders would stay in limbo and could even be encouraged to turn in their PMs through a tax holiday on past 'gains'.

To further ease the transition, banks could slow things down by offering higher rates on fiat accounts, and could probably find plenty of suckers eager to snap up 10% CDs on their FRNs even if true inflation was running a little higher.

He is on record saying he would legalize competing currencies as a way to bring gold and silver back into commerce, rather trying to have a centralized gold standard (at least at first).

AGgressive Metal wrote:He is on record saying he would legalize competing currencies as a way to bring gold and silver back into commerce, rather trying to have a centralized gold standard (at least at first).

yep

Competing currencies? I haven't heard about that. I'm not as informed as I should be. How would competing currencies work?

tractorman wrote:Competing currencies? I haven't heard about that. I'm not as informed as I should be. How would competing currencies work?

Long story short....start up a new currency and slowly inflate the other one into oblivion...along with our national debt, social security obligations, etc. The key is to keep the old currency attractive enough for long enough to avoid riots or trade wars.

* I have a love/hate relationship with economic engineering. I love the intricate beauty of the banksters' financial engineering, while I detest the suffering and poverty they create as a result.

the US dips paper in green ink and gives it away at no interest. what could POSSIBLY go wrong?hold physical PMs or weaponry.

tractorman wrote:Competing currencies? I haven't heard about that. I'm not as informed as I should be. How would competing currencies work?

It doesn't "work" or "not work" per se, he would just legalize competition by repealing most elements of the current legal tender laws. In other words, people and corporations would be free to use gold, silver, private currencies, foreign currencies, etc if they wanted to. This would put pressure on the Fed to keep the value of the dollar constant, or else people would flee to the now legal alternatives.

Ron Paul is standing on the shoulders of giants, in this case Austrian economist Friedrich von Hayek's famous work "Choice in Currency - A Way to Stop Inflation."

You can read it here: http://www.iea.org.uk/publications/rese ... -inflation

AGgressive Metal wrote:Ron Paul is standing on the shoulders of giants, in this case Austrian economist Friedrich von Hayek's famous work "Choice in Currency - A Way to Stop Inflation."

You can read it here: http://www.iea.org.uk/publications/rese ... -inflation

The late von Hayek was that rare and somewhat frightening creature, a liberal that made sense fairly often.

Congressman Paul's notions about returning to gold backing seem to be the only sane way to pull out of BHO's economic powerdive. But I'd modify even that. Use gold for foreign trade, buying AND selling. Silver goes back to coinage, as paper is backed by silver directly. Resize the minor coinage in copper, but not one buck is printed without the (at present) 1/30 troy oz of silver to back it.

Yes, there are liable to be holes in that set of ideas that a M1 tank could be driven through. Alternatives?



AU/AG/CU//

0g 394.97g 3550.84g

SSGOP, you would love Ron Paul's lecture series on money, especially the one given by Dr Edwin Vieira Jr:

Sheikh_yer_Bu'Tay wrote:I don't know about the gold standard. It would be terrific for those who hold gold and silver for the US to have Paul bring us back to Constitutional standards. If all FRN's were to be covered by the gold in Ft. Knox.... an ozt of gold would be worth something well north of $40,000!

Issuing a new dollar minted by our US Treasury would be more likely. Ending the Fed is one of Paul's major goals. Maybe people would be allowed to trade-in their green sealed (green dot) FRN's for red-sealed (red dot) Treasury bills. It is a really smart thing to do. We would no longer be borrowing FRN's at interest and save tons of money. I can imagine trading in FRN's for Treasuries at a rate of 10:1. Or even 100:1. Once again, a bonanza for PM holders!

On other issues, Paul has stated we can't turn the clock back over night. Things will have to be done gradually so as not to cause panic in the streets.

yes it would be gradual. yes it can be done by executive order. divide the present amount of FRN's by the ounces of gold preported to be in Fort Knox and gold is at $52,000 per troy oz. Silver in the $900-$1000 range. If Ben prints more , those figures go up. Thats why i hold a % of my portfolio in PM. My kids mine and sort for silver in the coin i purchase from banks on a weekly basis. Love them boys!