jim4silver
Silver Member
- Apr 15, 2008
- 3,662
- 495
If a dollar devaluation were ever to happen again (it happened when Roosevelt created a 40% devaluation of dollar via the gold executive order), wouldn't it be good to be holding PMs? I am not going to post a bunch of arguments as to why this could happen. I don't know if it will or not. But it is interesting to think about.
I am posting a link to an article that talks about this issue and a speech someone gave in 2002 that talked about ways to prevent deflation. In that speech this person mentions "tools" to curb deflation- several of the things we are actually doing today, such as low interest rates, fed buying, etc. The speaker goes on to mention one last "tool" which is dollar devaluation. He mentions the Roosevelt executive order with gold as an example of the good results of a devaluation. According to the article in the link, it is the only tool this speaker mentions that we have not yet done over the course of the past few years.
The speaker was Bernanke in 2002.
US Dollar To Be Devalued ? Ben Bernanke Already Told US His Plans | alternative economics
PS I am not saying I believe now they would "confiscate" PMs again like in the Roosevelt example. Back then gold was money and artificially valued at under 21 per ounce. After the gold executive order of Roosevelt, they artificially valued gold at 35 per ounce. This and new dollar printing allowed roughly a 40% devaluation of the dollar at the time. They paid 20 bucks for just under an ounce of gold during the "confiscation" period, then they used that gold to later pay other countries we owed with gold valued at 35 per ounce. That is my understanding of what happened.
Nowadays gold is not money in a legal sense. There would be no advantage to them "confiscating" gold again, especially considering most people don't own much.
Jim
I am posting a link to an article that talks about this issue and a speech someone gave in 2002 that talked about ways to prevent deflation. In that speech this person mentions "tools" to curb deflation- several of the things we are actually doing today, such as low interest rates, fed buying, etc. The speaker goes on to mention one last "tool" which is dollar devaluation. He mentions the Roosevelt executive order with gold as an example of the good results of a devaluation. According to the article in the link, it is the only tool this speaker mentions that we have not yet done over the course of the past few years.
The speaker was Bernanke in 2002.
US Dollar To Be Devalued ? Ben Bernanke Already Told US His Plans | alternative economics
PS I am not saying I believe now they would "confiscate" PMs again like in the Roosevelt example. Back then gold was money and artificially valued at under 21 per ounce. After the gold executive order of Roosevelt, they artificially valued gold at 35 per ounce. This and new dollar printing allowed roughly a 40% devaluation of the dollar at the time. They paid 20 bucks for just under an ounce of gold during the "confiscation" period, then they used that gold to later pay other countries we owed with gold valued at 35 per ounce. That is my understanding of what happened.
Nowadays gold is not money in a legal sense. There would be no advantage to them "confiscating" gold again, especially considering most people don't own much.
Jim
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