The full interview | digg story
CATO ran a related subject on the daily podcast recently, titled Is the Gold Standard Still the Gold Standard among Monetary Systems? Personally, I don't even know how you would justify a different standard. All the counter arguments have now been discredited.
...and the dollar continues to fall, while gold and silver continue to rise.
Downsize DC has been agitating for HR 2756, "Honest Money Act" for quite some time now.
However, they have finally added HR 4683, the "Free Competition in Currency Act" to a new action item entitled End the Inflation Tax.
...it should come as no surprise that the greatest boom and bust in American history happened immediately following the Fed's birth in 1913. Fed inflation put the inflationary "roar" in the "Roaring Twenties" followed by the biggest bust ever, the Great Depression.read more | digg story
All past inflations, booms, and busts were created through essentially the same process, including the recent stock market and housing bubbles. The Fed is simply the government's latest-and-greatest tool for legalized counterfeiting.
How You Can End This Con-game
Imagine what would happen if FRNs had to compete with gold, a form of money that can't be significantly inflated or deflated because of its scarcity and durability...
- People would begin to have gold accounts that they would use to buy and sell. The ownership of the gold would be transferred back and forth using checks, debit cards, paper certificates (currency), and a few coins, just like with FRNs.
- When you went shopping you would start to see two prices, one in FRNs and one in a certain weight of gold.
- If the Fed inflated the number of FRNs you would see the FRN prices rise while the gold price would stay roughly the same.
- You would begin to prefer to pay the gold price, so you would want to be paid in gold too.
- How could the Fed stop the flight to gold? Only one way. Stop inflating the number of FRNs.
Congressman Paul has hit upon the easiest way to end inflation, and the booms and busts that follow in its wake. Simply repeal the legal tender monopoly enjoyed by FRNs, and the coinage monopoly held by the United States government. Allow monetary competition. Not only would this help to end inflation and recessions, it would also limit the ability of politicians to hide the true cost of government through the inflation tax. But that's not all . . .
Forcing FRNs to compete with gold would also confer one other benefit. Over time the prices you pay will tend to fall as increases in economic efficiency (for example, technological improvements) lower the cost of production and increase the supply of goods and services. A stable money supply tends to become more valuable over time, unlike an inflationary currency that constantly loses value.
Both of these pieces of legislation would be a benefit to those of us seeking shelter from the continuing weakening of the dollar; which is probably why neither of them will see the light of day. Still, nothing happens without effort.
The text of Ron Paul's introduction of the Free Competition in Currency Act can be found here.