On Sep 25, 2008, at 12:30 PM, John Thornton wrote:
> Sandy Harris wrote:
>> Chris Doss <lookoverhere1 at yahoo.com> wrote:
>>
>>
>>> Can somebody explain to me how this theory/ideology works?
>>> I know the idea is that currency should be tied to something
>>> physical and tangible -- but why? And why gold of all things?
>>>
>>
>> It prevents governments from just printing and spending money,
>> the real cause of inflation. The US dollar was originally about
>> an ounce of silver. Last I looked, silver was over $10/ounce.
>
> The "real" cause of inflation?
There has never in history been any great inflation, of short or long
duration, that didn't involve a great expansion in the supply of legal
tender and (except in the 16th and 19th century Gold Rushes) it was
always governments that did the expanding.
>
> It prevents Govts. from spending anything?
False--under a gold standard govt. expenditures can be financed by
taxes and by arms-length borrowing.
>
> Chris, I think this is the answer you're looking for straight from a
> gold bug.
Shane Mage
"Money is not, by nature, gold; but gold, by nature, is money" (Karl Marx)