Quote from marketsurfer:
why do you think this, mr.thrifty?
thanks,
surf
If you take the number of U.S. Dollars in circulation (M1) and calculate the number of dollars for each oz of gold backing it, I believe you'll get a number like $4763 dollars per oz. This assumes the 9,000 tons of gold the Fed is supposed to have are actually in their possession, and not "leased" out to someone who may not pay them back (as in the case of LTCM).
M1 = $1,372,000,000,000
oz Au = 9,000 tons x 32,000 oz/ton
God forbid you should include the almost $10,000,000,000,000 of debt on the books
and God really forbid you include the $55,000,000,000,000 of unfunded SS and Medicare promises
So basically, my $2000 number is a "lowball", based on real inflation (not CPI) since 1979 using a reasonable gold price of $500 at the time. Obviously, with the dollar being debased at an alarming rate, its a moving target.
My personal opinion is that when the debt number hits $10 trillion next year (which would take 100 years of $100 billion per yr surplus to repay), our creditors will realize that its completely unpayable, and refuse to lend us more, forcing a "revaluation" of the US dollar with gold backing once again, and ending the printing press/helicopter money game.
In the words of Thomas Jefferson, who watched the Continental Dollars devalue to worthlessness, "Paper is poverty, it is only the ghost of money, and not money itself." The Constitution only allowed gold and silver to be used as money for good reason, and I think we will soon learn that same lesson again.
