Fiat Money, the Gold Standard, and the Deficit

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3 comments

  • is a 2 currency theory possible? domestic only blue collar pay in hi-value currency based on gold,precious metals,oil,energy. and “linked” white collar international greenback fiat (based on all goods,services,commodities as before) for business,corperation, wall street. an example of use: a binding business contract between workers,government,and businesses. a worker would be paid in fiat, that would be converted to new currency at the bank. the fiat would be held as collateral (for a set time) and once the payment in new currency to the worker is cleared the fiat money would be returned to the business. new currency would be increased in value yearly in a slow computation till full value is reached (to slow demand inflation.)and there are other details also to be worked out. i have asked other websites about this theory since i have not found anything similar on the net? so i do not know if it is good,bad, or impossible to implement? thank you for allowing my economic theory comments.

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  • Sorry, you lost me:
    1) why would we want to limit the size of our economy to the quantity of a physical element extracted from the ground? (and in our possession)?

    2) how does the gold standard stop the Gov’t from spending? They can just take a larger share of GDP for gov’t purposes…

    If we want to control gov’t spending, we shouldn’t try to have arbitrary economic limits do what the ballot box should. And politicians would push the gold standard to the brink (and beyond, to the harm of many) before they change their spending ways.