Full Version: The Gold Standard Is Coming
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Gold won’t be a sizzling issue this fall. The economy, entitlements and, possibly, war in the Middle East will dominate headlines. But the yellow metal will be a hot topic in the next 24 months. The commission is going to take on an importance that will astound today’s political punditry, besotted as they are with stale Keynesian quackeries about money, taxes and spending.

Why? Events economic and political. The ever deepening financial crisis around the world will force the new Romney-Ryan Administration to consider–and quickly, too–dramatic measures to deal with the disaster.
So what is it? I don't have time to look right now! Blush

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What Was The Gold Standard?

An extensive essay on the gold standard on The Encyclopedia of Economics and Liberty defines the gold standard as "a commitment by participating countries to fix the prices of their domestic currencies in terms of a specified amount of gold. National money and other forms of money (bank deposits and notes) were freely converted into gold at the fixed price."

A county under the gold standard would set a price for gold, say $100 an ounce and would buy and sell gold at that price. This effectively sets a value for the currency; in our fictional example $1 would be worth 1/100th of an ounce of gold. Other precious metals could be used to set a monetary standard; silver standards were common in the 1800s.

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