Time not right to put US on gold standard
- Published: Apr 18, 2018, 6 AM
Keith Weiner, the founder of Gold Standard Institute USA and founder and CEO of Money Metals, says putting the U.S. on a new gold standard with the dollar valued according to a specific weight in gold is nothing more than an exercise in “price-fixing.”
Weiner published an open letter on the Gold Standard Institute website directed at Rep. Alex X. Mooney, R-W.Va., who introduced H.R. 5404 seeking a new gold standard.
“Every attempt to fix prices has ended in disaster. Roman Emperor Diocletian set price caps in A.D. 301, which disrupted commerce. The Swiss National Bank lost 13 percent of Swiss GDP [gross domestic product] in the instant its currency peg failed in 2015,” writes Weiner.
He added: “The dollar is falling, because the U.S. government is sinking into debt it cannot repay. One dollar was once worth over 1,500 milligrams of gold, but it’s now down to 23.25mg. The Fed might fix the price temporarily, while the government’s gold holds out, but it cannot prop it up indefinitely.
“In a working gold standard, people deposit gold and get a piece of paper promising to return it. Paper is credit. And credit is built up, by countless decisions made by people in the market.
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“Our challenge today is that no dollars are gold receipts. Every dollar began life as an irredeemable promise. They cannot retroactively be declared to be gold receipts. It won’t work to try to impose a monolithic price policy, in lieu of the credit structure of debtors and creditors that evolves in the market.”
Weiner‘s complete letter can be found here.
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