Wednesday, February 23, 2011

What's So Hot About The Gold Standard ?

America is broke, well if this is what poverty looks like I'd hate to be in another country.

Do we owe some bills? yes we do. Can it be turned around ? I think so. Does it depend on our gold holdings? I doubt it.

I came across an article in the WSJ and decided to consult Wikipedia. Wikipedia is not the most reliable source for accurate information, but it is a starting place.

Our gold reserves stored at Fort Knox at today's price of $1400 per ounce is valued at $365 Billion. We have 8134 tons on deposit.

So if we were to sell every ounce the Government owned we couldn't pay 3% of our national debt. Amazing. But wait.

According to Wikipedia there is only 157,000 tons of gold worldwide. The "value" of this works out to only $7 trillion. If we held every ounce of gold in the world, we could only pay of 50% of our national debt. Amazing. But wait.

China and India the next economic superpowers which will dwarf the American economy in a matter of a decade or two, must be rolling in the stuff. Right? Wrong.

The United States has 5 times as much gold bullion on deposit as China and India. Combined. Okay how about the Saudi's? Saudi Arabia isn't even in the top ten list of countries. The only OPEC country that cracked the top 15 is Venezuela at #13 in the world with a measly 366 tons of gold. Just over 1/25th of our reserves.

So just what makes the Yuan or the Rupee so valuable? These countries can barely feed themselves. How strong will their economies be if they have a crop failure? What's backing up the strength of these currencies? It sure ain't gold.

Here is the run down of the top 13 nation's gold reserves

USA 8134 tons
Ger 3402
Ita 2452
Fra 2435
Chi 1054
Swit 1054
Rus 784
Jap 765
Neth 613
Ind 558
Tai 424
Port 383
Ven 366

Gold has been a benchmark of a nation's wealth since about the dawn of man, but it isn't the only measure of a country's wealth. During Holland's golden age of prosperity in the 1600's, they got on the tulip bulb standard. They exchanged their gold and silver to speculate on the value of tulip bulbs. It was their "pound puppy" craze on steriods, if you will. When a famine hit Holland at the height of the tulip bulb investment craze, to survive the famine, the "rich" ate their portfolios. So much for tulip bulbs being a viable treasure.

Be it gold or diamonds or oil, a nation's true value lays with it's citizens. Their resourcefulness and creativity. No nation on Earth can touch us in normal times, when we apply ourselves. However today instead of being productive, we fart around with these Obama social justice bullshit ideas, which are meant to enslave us, not make us better. This is what is holding us back, not some international currency manipulation. We still hold the Big Stick, be it in gold or people, if we will just harness our strength.

Link to WSJ article


Steve

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.