Quote:
Originally Posted by charles brough
But I sense you are not real predicting we will re-establish the gold standard, are you?
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Hi Charles,
I read two articles the other day on stabilisation of the global financial system through a gold standard. For most of human civilisation over thousands of years there has been some form of gold standard in operation, where the central bank/treasury sets the transfer prices of goods and services to a common standard. Up until the early 1970's there was a gold standard in operation where the global currencies were linked to the US dollar through its relationship with the price of gold (around $35).
The main driver for a gold standard is that, of the 680 or so trillion of outstanding derivatives, a high proportion (2/3 or so) are related to currency values and interest rates, a good earner considering that these factors remain largely under the control of the reserve banks (a good earner if you don't actually work for a living).
While Allan Greenspan may have been trying to protect the US economy from economic fallout, his own 'stairway to heaven' (If there's a bustle in your hedgerow, don't be alarmed now
) was a major contributor to the global problems we now face.
So a gold standard would help protect the global financial system by stopping the speculators from sucking the grease out of the bearings before the engine seizes (again).
I wrote the following 10 years ago (5th Oct 1998). Surely there must be a way to get a win/win situation (between the people and business not between the governments and the business i.e. the current status quo), and not by continuing the exact same poor policies that lead us into this mess in the first place.
'The plea of BeiBionn'
You can have your magic beans Jack,
your children are hungry and we need the cow back.
The lack of just terms and equitable or fair pacts,
expose all crooked beanstalks to concerted attacks.
Unless obsessive cycles are stopped in their tracks,
our towns will again be as flat as tacks.
You have been too trusting Jack,
your childrens futures remain black,
while current problems compound through lack.
Struggle earnestly against the pack,
repudiate rights to depreciatingly retract,
as giants fortress lie ripe for sack.
For only fair shares of the golden goose Jack,
will save beanstalks and giants from the axe.
