On Fri, 22 Jun 2012, Alex Hutton <
highspeeddub@gmail.com> wrote:
> A free market does not require that people behave as perfectly
> rational actors who always act in their own best interest.
on the ability to trust the other party or parties involved. That ability is
granted by legislation and government enforcement mechanisms. Such regulation
is essential for anyone who wants to charge high prices for their goods and
services. Otherwise you just have the "market for lemons" because most buyers
expect to get low quality goods and won't pay for quality when they don't
expect to get it.
> The point is, people who act contrary to their best interests will
> face consequences that are contrary to their best interests. And if
> they choose to improve their actions they will improve the
> consequences of their actions.
Alternatively "conservative" Americans can just keep voting Republican and
allow things to keep getting worse.
There was an interesting interview on youtube with an insane Tea Party woman
who was campaigning against health care reform. It turned out that her
husband had no health care...
> Rohan McLeod wrote :
> > -the consequence of globalisation is to move jobs to places with low
> > labor costs and raise unemployment elsewhere.
> > -the consequence of inadequately regulated stock-markets are
> > non-productive booms and busts
> > there is a longer 'rant' here:
> Those two points are largely due to fractional reserve lending,
> central banking and fiat currency. All of which are forms of
> intervention in the market by governments.
http://en.wikipedia.org/wiki/Gold_reserve
The US has a stockpile of 8,133.5 tonnes of gold worth about $495B.
http://en.wikipedia.org/wiki/Circulation_(currency)
The US has $850.7B in circulation, so they would need to almost double their
gold stockpile to have a gold backed currency. The other countries in the
list seem to have a worse ratio of gold stockpile to circulating currency.
Apparently about 1/5 of the gold mined in the entire history of the human race
is in government stockpiles. If all current currency reserves were backed by
gold then the stockpiles would total 69720 tonnes or 42% of all gold ever
mined.
Then with a fixed gold price the mining companies wouldn't be able to vary
their output according to supply and demand and the gold production would
entirely cease when mining costs increased above the fixed price of gold.
Of course there is also the issue that the vast majority of the financial
world doesn't deal with even paper money. Cash is the small-change of the
financial system. Stockmarket booms and busts would not be affected by a gold
standard because they don't deal in hard currency anyway.
The gold standard only worked for a pre-industrial world. But it's also good
for distracting people who know that the current US system isn't working and
who otherwise might create political pressure for some problems to be solved.