
After a Century of the Fed, It's Time to Return to Constitutional Money (2014) - miles
https://www.forbes.com/sites/georgeleef/2014/02/11/after-a-century-of-the-fed-its-time-to-return-to-constitutional-money/
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aplummer
What a bizarrely naive article to completely fail to appreciate the many
historical economic benefits from central bank market interventions and
investments that wouldn’t be possible with the gold standard...

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ur-whale
Krugman, leave that body !

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smitty1e
The thing that grieves me is the pretense that monetary policy occurs in some
apolitical realm.

The spirit of the 1787 Constitution is that people wielding vast power stand
for election.

The Supreme Court does not.

If the argument is that the Federal Reserve resembles SCOTUS, fine.

But an outfit tantamount in power to a fourth branch of government ought not
to have been rushed through legislatively at the end of 1913.

Reform, make transparent, and amend the Constitution to legitimize this
entity, say I.

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Fjolsvith
> Reform, make transparent, and amend the Constitution to legitimize this
> entity, say I.

Dismantle this entity, say I.

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smitty1e
I'm not rejecting that completely, but there needs to be some healthy
dialogue.

By which I do NOT mean our cancel culture hogwash where anyone disagreeing
with the globalist orthodoxy is an -ist -ite -ism of the worst sort.

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dvasdekis
Folks who believe that tying the value of money to the gold standard would
ensure stability should instead look at how the price of shares has changed
against the price of gold historically.[1] If we priced shares in gold terms,
historic sharemarket swings would be even more volatile than what we see at
present.

Instead of considering the USD price of something as the 'value' of an asset,
a better stance is to say that all assets can only be priced against each
other. E.g. shares have decreased in value relative to cash and gold this
quarter, but are potentially stable against real estate. From this lens, an
individual interested in capital preservation should instead own a bit of
everything, instead of a pile of cash/gold.

Lastly, for people who want to maintain the gold standard for their personal
cash stores, they can enter into futures contracts at extremely low overhead,
which will link their cash stores to the price of gold ongoing. If you're keen
on gold, why not?

1: [https://www.businessinsider.com.au/sp-500-priced-in-
gold-201...](https://www.businessinsider.com.au/sp-500-priced-in-
gold-2015-7?nojs=1) (I wish I had an updated version)

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cpr
You do understand that gold values have been wildly manipulated for decades by
the central banks, right?

They've been depressing them in the past decade with futures shenanigans, all
the while buying up gold like mad. (Those are of course related.)

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Fjolsvith
“The Fed will finance a special purpose vehicle (SPV) for each acronym to
conduct these operations. The Treasury, using the Exchange Stabilization Fund,
will make an equity investment in each SPV and be in a “first loss” position.
What does this mean? In essence, the Treasury, not the Fed, is buying all
these securities and backstopping of loans; the Fed is acting as banker and
providing financing. The Fed hired BlackRock Inc. to purchase these securities
and handle the administration of the SPVs on behalf of the owner, the
Treasury.

In other words, the federal government is nationalizing large swaths of the
financial markets. The Fed is providing the money to do it. BlackRock will be
doing the trades.

This scheme essentially merges the Fed and Treasury into one organization. So,
meet your new Fed chairman, Donald J. Trump.”

[https://www.bloomberg.com/opinion/articles/2020-03-27/federa...](https://www.bloomberg.com/opinion/articles/2020-03-27/federal-
reserve-s-financial-cure-risks-being-worse-than-disease)

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blackrock
Hold on to your butts!

By the time this coronavirus crisis is over, the stock market is going to
accelerate into overdrive.

Infinite QE, will push stock prices higher and higher.

Trump is going to give $4 Trillion dollars away, to corporate America. That’s
with a T. These are going to be in loans, that can be forgiven.

Housing will likely double in 10 years. If you thought a $700,000 house is
expensive now, then in 10 years, this will look like a bargain. That same junk
house will go for a cool $1.4 million.

Everything will cost more. Groceries, gasoline, cars. But your salary will
remain the same.

I hope you can afford a 60 year mortgage, because that is what you’ll need to
get.

Welcome to the next stage in America. The rich oligarchs got their way, and
will now begin to enslave your children.

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JamesBarney
I'd immediately quit my job and get into the house building game. I don't
really know what I'm doing but if labor costs halve relative to the price of a
home, I'd be rolling in it.

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thulecitizen
It will be so fun if we turn real life into the game of Monopoly. Oh wait...

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JamesBarney
The point is the cost of everything can't double while labor costs stay the
same because labor makes up so much of the cost of the all the goods we
consume.

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chrisco255
Let's just use ETH or BTC and call it a day. A gold standard would be nice,
but even if we got on it, how long before governments withdrew from it again?
Only a matter of time. I think it's time for a separation of money and state.

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mardifoufs
Actually this crisis is exactly why we don't need that separation. We need a
government that can actually respond to crisis.

And even if we truly needed a new monetary system, crypto is just not the
answer. Crypto has always and will always be useless as a currency and even as
a store of value. Blockchains sound amazing to some but they are useless in
the real world. It's been 12 years, every single use case, speculation aside,
has been tried and failed miserably. The ship has sailed

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phyalow
I agree with your points, however its worth pointing out the dollar is also a
bad store of value too!

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gumby
But a good signalling and liquidity mechanism, and the very nature you decry
(poor store of value) is an incentive to invest in productive assets.

