If anyone missed this article last week, I think it will make everyone quite happy.
Its astounding how many right-headed people are there in the world. If they could just be concentrated in one geographical location, we could have anarchy.
Actually, the rural poor in Asian countries, including mine, are much more receptive to gold than we city folk are.
They don’t have banks in their areas, and the few that open up are dishonest. City folk like us are bound to go by cheque or cash drawn from the bank, because we can trust people in our concentrated regions more.
The rural folk prefer gold because they know that some jeweller will always want that gold - it has non-monetary uses.
And there is that difference between debtors and creditors. Since city folk are mostly debtors/spenders because they have a good fixed income, cash is preferred, because cash depreciates in our hand and puts us in a more favourable position while paying it back. Since rural folk don’t know what the next rainy season will bring and have to save up for it, they’ll keep gold, knowing full well that many will want their gold once festival season and wedding season start up.
Not quite of topic..but i was looking for an essay/vid explaining an almost step by step process in return to the gold standard, in moderntimes preferably.
Iam looking to answer these questions…
Wouldn’t we need to have a reduction in M1 to reconcile to the gold reserves? Wouldn’t that require significant deflation? And doesn’t the reserve requirement, which is completely separate from the currency standard, have much more impact on actual inflation?
Justin D,
This video deals with those questions (second half):
Thanks