US congressman submits bill for return to gold standard
(www.moneymetals.com)
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Serious question: would gold have more or less value should we move back to the gold standard? Currently 1 troy oz of gold is trading at about $1600 but if the fed is toast then the fiat currency will be valueless. we will no longer be able to compare gold's value to fiat money. so what would a car that currently costs $20,000 (or 12.5 gold pieces) cost in gold after we move to the gold standard? More or less than 12.5 gold pieces? Logic would dictate that if we move to the gold standard gold would be more valuable and that car would require less gold to purchase. Any economy fags out there who can explain it like I'm vaccinated?
My bullshit math skills show that to stay level with with M2 money supply the price of gold would hit over 188,000 an ounce, and that's based on global reserves of gold. I think we made concessions getting off the gold standard so that we could build money supply to support our population, which probably made sense.I'm pretty drunk at the moment, but I digress. I personally don't think getting back to the gold standard makes much sense in our current state, but as someone who dabbles in gold panning, I'd be stoked.
Drunk or not: I'm running with your figure of $188,000 per ounce :)
Current dollar is worth 4 cents.
A forty dollar item would cost 4 bucks if a dollar was worth 100 cents.
So if a dollar becomes 100 cents value again prices will adjust.