Pah, that\’s nothing!

Dead recluse had $7 million worth of gold bars in house

Given the way QE\’s going the wife\’s wedding ring will be worth that in a few months.

2 thoughts on “Pah, that\’s nothing!”

  1. So Much For Subtlety

    The US dollar has already lost something like 95% of its value since World War One.

    They seem determined to make it worth a lot less if not worthless.

    I tend to think debasing the currency goes with Union power. Certainly the French managed to maintain the same gold standard, more or less, from the French Revolution down to WW1. And then every reformed Franc was turned to toilet paper in a decade or so. Obama is beholden to the public sector unions and hence he seems to be following Europe’s ruinous path. But I might be wrong.

    Either way, the Clever Clogs who claim they are so much smarter than the rest of us that they can run a decent fiat currency system have been shown to be not as clever as they seem to think. The only currency that has held its value has been the Swiss Frank and even that is relative.

    In the medium and long term, there really does appear to be no alternative to the gold standard at least if you think maintaining the value of the currency of the Realm is important.

    So it is a joke, but an increasingly unfunny one.

  2. Nobody can run a fiat/currency system any more than they can run a gold/specie system. Currency quantity in circulation – the metric formerly known as M3 – appears to be declining still – or at least not rising as fast as population. The constraint on GDP growth still appears to be money supply.

    While I can understand why people might think maintaining the value of the currency is important ( for reasons of intertemporal substitution ) it’s not critical.

    What I don’t understand is – if we had an omniscient central bank that maintained the supply increase in money perfectly, we’d still have “inflation”, even though according to the Big Book of Fiat, we should not. Why is this?

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