Any ideas as to what would/should happen to the gold held by the FRB if the Fed was ever abolished?
Say we went back to a gold backed currency.
I have read arguments using this as a reason why we shouldn’t go back to a gold standard. Not sure why though.
This is purely a hypothetical, since the government would never voluntarily disband their printing press.
But IF it happened.
The dissolving FED and/or government would have to redeem each and every one of those outstanding Federal Reserve Notes. They would do so with all that gold. The question is, what price would the FED set as par for redeeming each note. I can assure you that it is the holder of the FRNs and not the government that will get screwed in that transaction.
by frb do you mean federal reserve bank???
i dont know if the federal reserve bank of frb has any gold. have you checked??
i have read that there is about 265 million ounces at fort knox or there about.
if the federal reserve does have some gold i expect it would go to pay some thing priced in gold once gold became money…an electric bill or landscaper or demolition crew.
Sell it.
“I have read arguments using this as a reason why we shouldn’t go back to a gold standard.”
i dont think selling (for a non existent paper currency) it is what would take place…unless you are equating selling gold with exchanging the gold for some good or service.
It would become convertible for Federal Reserve Notes, ending the expropriation of the holders of these notes.
“Say we went back to a gold backed currency.”
i believe this post was referring to the end of the federal reserve so there wouldnt be federal reserve notes.
by frb do you mean federal reserve bank???
i dont know if the federal reserve bank of frb has any gold. have you checked??
For whose profit?
The dollars are still and would still be physically in existence. The proposal is that people would be able to turn in their existing dollars for tiny amounts of Gold (that’s all it would amount to given the expansive money supply) which would then be circulated and eventually deposited in exchange for REAL money notes on the market.
The owners obviously.
Meaning the FRB governors, or the holders of U.S. Dollars?
If I knew that the government would obey my every command, I’d just have them abolish legal tender laws and then privatize (really, not formally) the Fed. Its gold would of course go to the purchaser. This is not only a good idea, but indeed the only way possible to escape form inflation. Redeeming dollars for gold, ala Mises/Rothbard, as I’ve argued elsewhere, runs counter to the Money Value Theorem, and would never work.
has inflation occurred without a central bank??
well, you might find this interesting.
has inflation occurred without a central bank??
Moreover, the inflation of the money supply produced by fractional
reserve banking decreases the roll over risk in the future as an increase in
available funds in the future can be expected.“”
and then privatize (really, not formally) the Fed. Its gold would of course go to the purchaser. This is not only a good idea, but indeed the only way possible to escape form inflation.
is form a typo? or are you referring to something called form inflation?
are you saying that inflation has only been a result of a central bank while your interesting link says iflation of the money supply solely from fractional reserve banking?
Any ideas as to what would/should happen to the gold held by the FRB if the Fed was ever abolished?“”
by frb do you mean federal reserve bank???
i dont know if the federal reserve bank of frb has any gold. have you checked??
i have read that there is about 265 million ounces at fort knox or there about.
Bernanke said that they have been selling gold. They probably won’t have any left before long.
Inflation can occur without a central bank, but only a central bank can inflate to such a catastrophic extent as the Federal Reserve and other worldwide central banks. Inflation can occur in free banking, but banks are constrained to a severe extent in their ability to inflate. Inflation can occur via coin debasement, but obviously in a fiat money system that is a moot point.
Only a 100% reserve banking system with commodity currency and a prohibition on debasement would be inflation resistant.
But anything would be better than central banking.
has inflation occurred without a central bank??
Moreover, the inflation of the money supply produced by fractional
reserve banking decreases the roll over risk in the future as an increase in
available funds in the future can be expected.“”
and then privatize (really, not formally) the Fed. Its gold would of course go to the purchaser. This is not only a good idea, but indeed the only way possible to escape form inflation.
is form a typo? or are you referring to something called form inflation?
are you saying that inflation has only been a result of a central bank while your interesting link says iflation of the money supply solely from fractional reserve banking?