On the Twitter he’s claiming that gold coins can be debased as easily as printing paper. Now, he’s not talking about gold receipts, but gold coins.
EDIT: A proper analogy would be that gold coins can be easily minted from raw gold as FRNs can be printed from cotton. Or, that gold coins can be clipped as FRNs can be clipped (but that’s not what the Fed/Treasury does with FRNs).
He also said:
3 required roles of a currency: 1. Means of Payment; 2. Unit of Account; 3. Store of Value. Gold today isnt a currency as it is NOT 1. & 2. (source)
The state of Utah legallized gold and silver coins as currency. And lots of people use gold as a unit of account.
Surely they can be easily debased. Just mix gold with something else with rising percentage of the latter and force people to accept your coins. That’s why we want free market in money supply, so competition forces business to behave nicely.
It is conceivably possible to debase gold coins, therefore we shouldn’t bother trying them, and should just use imaginary numbers on a computer…?
Nirvana fallacy much? Beside, who wants someone to have a monopoly on currency, after all? If Roubini thinks that the numbers on the bank’s computer are more reliable than gold coins, by all means let him carry on using them after the legal tender laws are repealed, and the central banks’ charters revoked.
Is this about what can conceivably be done naturally, or what the government arbitrarily allows to be done under the present political system? I think it’s the latter that really needs to be changed. I don’t see why you couldn’t make payments and keep accounts in units of gold if you wanted to, I just see government policy discouraging it in favour of their fiat.
