All That Glimmers – NYTimes.com

Riposte to Ron Paul:

Gold can’t be smoked away. Yet, as money, it shares tobacco’s basic drawback: It would shackle the economy to how much gold we could get our hands on. Today the Fed can print dollars at will to meet the growing demand for money as the economy grows, or even to encourage growth. Under a gold standard, the economy couldn’t grow faster than the supply of gold.

via All That Glimmers – NYTimes.com.

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2 thoughts on “All That Glimmers – NYTimes.com

  1. adebayoj says:

    I agree with some of Ron Paul’s views about the way governments should be run especially in terms of foreign policy, but his domestic view of the government policy seems particularly lacking. Pegging the dollar to the gold standard would not only mean giant leaps backwards, the kind of message it would send to foreign investors would not be appropriate. In this day of hedge funds and sophisticated trading and hedging strategies by wall street and global commodity traders, pegging any currency to a particular currency especially minerals is a bad idea like the article point out. This is why is is particularly distressing that conservative talk show hosts like glen beck and others are calling for it. It shows that rather than acknowledge the sophisticated nature of modern markets, they would rather peg the dollar to gold in order to limit government spending and potentially damage the american economy.

    http://blogs.marketwatch.com/great-columnist/2011/11/07/occupy-the-federal-reserve-for-a-new-gold-standard/?mod=google_news_blog

  2. samstoddard says:

    I loved the article from Eduardo Porter. His take on gold and America’s monetary system was both fresh and insightful. However, I think that it had a taste of the very one sided extreme thinking that Ron Paul and many others have when approaching this very complex crisis with so many aspects tied to economics, banking, and finance.

    I always have a problem when all of the blame gets dumped unfairly on one person, organization, or source. Much like when many people want to point fingers at investment bankers and wall-street for the debt crisis that we are in. Wall Street and the banks share fault for the financial and economic problems we face, and the FED also may have some blame to step up too. This does not mean that it justifies the complete dismantle of the FED and to demand that the dollar be backed by gold. I think that at the same time we should be open to reform and improvement of the Federal Reserve. Congressmen Paul has some interesting out-of-the-box ideas, and I think that this kind of thinking is a step in the right direction, but we must be careful to not step too far.

    This is a great article that discusses some of the problems with the FED; e.g., the recent swelling of its authority, its structure, etc.

    http://voices.washingtonpost.com/ezra-klein/2009/07/the_problems_with_the_federal.html

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