date, wage increases have largely been absorbed by employers, but, if costs are moving up, prices ultimately have to follow suit. Under a gold standard, the amount of credit that an economy can support is determined by the economy's tangible assets, since every credit instrument is ultimately a claim on some tangible asset. Greenspan of course went to become the front-man for the interminably corrupted Central Bank system, which is utilized as a wealth-confiscation and control mechanism for the elitists who control western Governments (Mayer Rotschild: let me issue and control a nations currency and I care not who. I think thats like wearing the wrong size shoes and saying the shoes are uncomfortable!
So a free banking system under essay eli whitney the gold standard must be just what the economy needs, if Greenspan had it right. Finally, buried at the very end of the interview was perhaps the most interesting statement by Greenspan : the former Fed Chair's implicit admission that Ron Paul was right all along:. Great Britain fared even worse, and rather than absorb the full consequences of her previous folly, she abandoned the gold standard completely in 1931, tearing asunder what remained of the fabric of confidence and inducing a world-wide series of bank failures. If you impose inflation on stagnation, you get stagflation. yet everything changed a few decades later when Greenspan was put in charge of the Federal Reserve in the late 1980s, instead of applying the above wisdom, for example by limiting the bank's interference in the private sector and letting market forces determine winners and. But the fact is that there are now more claims outstanding than real assets. In order to understand the source of their antagonism, it is necessary first to understand the specific role of gold in a free society. As productivity growth slows down, the whole economic system slows down. Credit instruments and fiat currency depend on the credit worthiness of a counterparty. I view gold as the primary global currency. As we said then, in retrospect it is no wonder " why the 1 hates the gold standard " and added that the chart above, " should also clarify just why to the "1 including their protectors in the "developed market" central banking system, their. A metal is generally chosen because it is homogeneous and divisible: every unit is the same as every other and it can be blended or formed in any quantity.
When gold is accepted as the medium of exchange by most or all nations, an unhampered free international gold standard serves to foster a world-wide division of labor and the broadest international trade. Rather it is a cry of pain, where people are saying: Do something. The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves. But since it is rarely the case that all depositors want to withdraw all their gold at the same time, the banker need keep only a fraction of his total deposits in gold as reserves. First, the medium of exchange should be durable. What medium of exchange will be acceptable to all participants in an economy is not determined arbitrarily.