Ney on Romney

[drew]

What the crap are talking about?

Personal attacks more than anything rational from the looks of things.

 

[billt]

Billt I am curious about what you know about the gold standard and why you think it would be bad for our country.

Far from it being "lunacy" to return to the gold standard it could help restore us to prosperity and limit government power by making it impossible for them to print (digitally or otherwise) new money. Not to mention that the constitution prohibits the government from issuing paper money.

The problem with Ron Paul, along with all of his "Gold Standard" lunacy, is that his base of loyal 10%'ers hear this, and right away start regurgitating it on every blog and forum they wash up on, trying to sell it as economic salvation, when in reality it would spell economic disaster. However, much like the "occupy crowd", most do not have a clue of what they are talking about.

If the U.S. and a substantial number of other industrial economies adopted a gold standard, the U.S. would lose the ability to tune its economic policies to fit domestic conditions.

For example, in early 1995 the dollar weakened against the Yen. Under a gold standard, such a decline in the dollar would not have been allowed. Instead the Federal Reserve would have raised interest rates considerably in order to keep the value of the dollar fixed at its gold equivalent, and a recession would probably have followed. Under a gold standard, the burden of adjustment is always placed on the weak currency country.

Countries seeing downward market pressure on the values of their currencies are forced to contract their economies and raise unemployment. The gold standard imposes no equivalent adjustment burden on countries seeing upward market pressure on currency values. Because of that, a gold standard regime will see a higher average unemployment rate than an alternative managed regime. A gold standard played a major part in keeping governments from fighting the Great Depression, and was a major factor turning the recession of 1929-1931 into the Great Depression of 1931-1941.

The purpose of a gold standard is to produce stable money. I don't know of any major negative economic event in all of history that was caused by money that was too stable. However, the gold standard did keep governments from fighting the Great Depression via currency devaluation, an economic band-aid that governments have reached for over thousands of years.

Today economists like to think they invented currency devaluation. And, like I said, when Germany, Britain and Japan (and many other parts of their empires like Argentina, India, Korea etc.) devalued, this created a competitive disadvantage for countries that remained on the gold standard, notably the U.S. and France.

Countries that were not on the gold standard in 1929--or that quickly abandoned the gold standard by and large escaped the Great Depression. Countries that abandoned the gold standard in 1930 and 1931 suffered from the Great Depression, but escaped its worst ravages. Countries that held to the gold standard through 1933 (like the United States) or 1936 (like France) suffered the worst from the Great Depression.

Commitment to the gold standard prevented Federal Reserve action to expand the money supply in 1930 and 1931 and forced President Hoover into destructive attempts at budget-balancing in order to avoid a gold standard-generated run on the dollar. Also, commitment to the gold standard left countries vulnerable to "runs" on their currencies--Mexico in January of 1995 writ very, very large. Such a run, and even the fear that there might be a future run, boosted unemployment and amplified business cycles during the gold standard era.

In today’s world economy, a gold standard sounds a lot more wonderful than it actually is. When you look at past history, and compare it directly to today’s monetary systems in place all over the world, a gold standard simply is no solution to current economic problems. Thinking that going back to a gold standard in this country would solve this nations economic crisis, is just about as naive as thinking taxing the top 1% even more will alleviate this countries debt problems. But you cannot communicate this to Ron Paul's 10% base that broadcast from their mothers basement, by simply regurgitating his nonsense without any additional thinking on their part. Mostly due to the fact they don't have a clue, and follow him like blind Lemmings.

 

[locobob]

Not to mention that the constitution prohibits the government from issuing paper money.
But who on this forum really cares about that silly ol thing anyways?

Um no.... it prohibits the states from issuing paper money. Think maybe you should read up on some Supreme Court decisions from the late 19th century.

 

[locobob]

Personally I see nothing to like about Romney. He's a silver spoon corporate raider with Massachusetts social values - he won't have much interest in gun rights once the voting is over.

 

[mkwerx]

There's no appreciable difference between the liberal Mitt Romney, and the liberal Barack Obama. Both are left of center - only one lies about being a conservative, while the other is openly liberal. Both are anti-gun while trying to pander to "hunters" that "I'm one of you too, I bought a shotgun when I was xx" - both are all for government run health care - Romney being the first to actually GET it. Think Romney will be for repealing Obamacare? Nah - he'll push for it's expansion as Romneycare 2.0 or Romneycare - National Edition.

It won't make one damn difference which one gets the white house - the REAL battle ground is the Senate and the House of Representatives - the LAW MAKERS are the ones that actually set the rules and have real effect on us. THEY pass the budgets, THEY make the laws, THEY confirm or deny Presidential appointees (unless you're Obama, and you just appoint people while the lawmakers are on "recess" so you can shove your people into power without oversight.) With Obama in the white house - he can't do crap without the current Republican controlled congress going along with it. With Romney in office, there won't be the same resistance, because partisan politics will win out - and the GOP won't stand in Romney's way and make him look bad, because they will want a two-term (R) in office, instead of a (D). So if Romney pushes for gun control, socialized health care, national ID, and all the other liberal agenda garbage - the GOP will roll over and let him, and we'll be truly hosed.

And so I will cast my vote with my conscience, because I will NOT vote for a liberal, no matter what letter comes in front of his name. It's like voting for which STD to contract - syphilis or gonorrhea - either way you get the shaft. Voting for either Romney or Obama is throwing away my vote, and I won't do either.

 

[slimmer13]

Instead the Federal Reserve would have raised interest rates considerably

Commitment to the gold standard prevented Federal Reserve action to expand the money supply in 1930 and 1931

Prevent action from the fed? Oh no sounds horrible
Good thing Dr Paul wants to get rid of them too. Unfortunatly thats the main reason he wont get the nomination, his opposition to the bankers death grip on the country.

So whats your explanation on why the fed is good for this country?

 

[dmancornell]

If the U.S. and a substantial number of other industrial economies adopted a gold standard, the U.S. would lose the ability to tune its economic policies to fit domestic conditions.

Implying the US economy should be centrally planned to begin with. You sound like Obama. Or Romney. Can't tell the difference.

For example, in early 1995 the dollar weakened against the Yen. Under a gold standard, such a decline in the dollar would not have been allowed. Instead the Federal Reserve would have raised interest rates considerably in order to keep the value of the dollar fixed at its gold equivalent, and a recession would probably have followed. Under a gold standard, the burden of adjustment is always placed on the weak currency country.

So Clinton had Greenspan delay the recession a few years to get re-elected in '96, at the cost of a deeper recession down the road. How exactly is that a good thing?

Countries seeing downward market pressure on the values of their currencies are forced to contract their economies and raise unemployment. The gold standard imposes no equivalent adjustment burden on countries seeing upward market pressure on currency values. Because of that, a gold standard regime will see a higher average unemployment rate than an alternative managed regime. A gold standard played a major part in keeping governments from fighting the Great Depression, and was a major factor turning the recession of 1929-1931 into the Great Depression of 1931-1941.

The purpose of a gold standard is to produce stable money. I don't know of any major negative economic event in all of history that was caused by money that was too stable. However, the gold standard did keep governments from fighting the Great Depression via currency devaluation, an economic band-aid that governments have reached for over thousands of years.

Wrong, the purpose of the gold standard is to instill fiscal discipline, the stability is a bonus effect. The cost is the removal of any quick economic fixes, or your so-called bandaids, which usually don't work anyways. More on that later. I'll acknowledge a gold standard economy *might* see higher unemployment in a contraction, since unemployment occurs when real wages exceed productivity. But so what? Unemployment fixes itself through creative destruction. Unemployment only persists when institutional interference prevents the market from fixing itself.

On the other hand, allowing the government to manipulate interest rates and create money and credit out of thin air is vastly more hazardous because government has no discipline. Moreover, electoral pressure creates moral hazard, because politicians want to look good in the short term, without any consideration for the long term damage. Looking at the effect the government has had on the economy in the past 40 years, the gold standard does more good than harm.

Today economists like to think they invented currency devaluation. And, like I said, when Germany, Britain and Japan (and many other parts of their empires like Argentina, India, Korea etc.) devalued, this created a competitive disadvantage for countries that remained on the gold standard, notably the U.S. and France.

Countries that were not on the gold standard in 1929--or that quickly abandoned the gold standard by and large escaped the Great Depression. Countries that abandoned the gold standard in 1930 and 1931 suffered from the Great Depression, but escaped its worst ravages. Countries that held to the gold standard through 1933 (like the United States) or 1936 (like France) suffered the worst from the Great Depression.

BS. The Depression persisted in the US because of uncertainty caused by FDR's anti-business policies. His Keynesian policies (i.e. the liquidity injection which you count on to lower unemployment) did little to restore the economy. More on that: Great Myths of the Great Depression [Mackinac Center]

Commitment to the gold standard prevented Federal Reserve action to expand the money supply in 1930 and 1931 and forced President Hoover into destructive attempts at budget-balancing in order to avoid a gold standard-generated run on the dollar. Also, commitment to the gold standard left countries vulnerable to "runs" on their currencies--Mexico in January of 1995 writ very, very large. Such a run, and even the fear that there might be a future run, boosted unemployment and amplified business cycles during the gold standard era.

The Great Depression was caused by the Federal Reserve's expansion of the money supply in the 20's causing a massive bubble in asset prices. By 1929 no amount of government action could have prevented the crash. Are you implying the lack of a gold standard would have prevented the run on banks and hoarding of gold? Please.

In today's world economy, a gold standard sounds a lot more wonderful than it actually is. When you look at past history, and compare it directly to today's monetary systems in place all over the world, a gold standard simply is no solution to current economic problems. Thinking that going back to a gold standard in this country would solve this nations economic crisis, is just about as naive as thinking taxing the top 1% even more will alleviate this countries debt problems. But you cannot communicate this to Ron Paul's 10% base that broadcast from their mothers basement, by simply regurgitating his nonsense without any additional thinking on their part. Mostly due to the fact they don't have a clue, and follow him like blind Lemmings.

Once again, the gold standard is to instill discipline. Economic problems can fix themselves without the politically driven interference from government entities.

What's really amusing about the arrogance of the anti-gold standard people is the fact that Nixon abandoned the post WW2 gold standard because the US government could not simultaneously fund both LBJ's pigheaded social experiments and the Vietnam War. So despite the fact that the final abandonment of the gold standard was a direct result of government profligacy, you still somehow stick to the claims that the gold standard is somehow for economic growth, or stability, or whatever. What a joke.