Talk:Gold standard

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I added the copyedit tag because some of the text is duplicated and some of the grammar is questionable. I haven't the time to fix it at the moment.

Selected on Template:March 18 selected anniversaries (may be in HTML comment)

I presume that "reasons why" in the article as it was were those given by the Nixon Administration - the opposing view is attributable to nearly everyone who commented on the Euro-dollar. Pick your source. I'll stand by the fact that there was no way there was enough gold in Fort Knox to redeem the notes in 1975, and no way to test for it, since US citizens couldn't own gold and Europeans couldn't redeem notes.24

Well duh........

U.S. currency was representative money and as such no one ever pretended that the United States had the gold reserves to redeem all the dollars in circulation if everyone decided to redeem their dollars at the same time.

ok, this is our "representative" versus "commodity" argument again. I think it arises because really there is some degree of commodity, credit, and fiat involved in *every* kind of money. In other words we should not write about "commodity money" but rather "commodity settling", and likewise "credit clearing", and "fiat backing" - any of which may be involved in a given currency.

The trouble was that in 1971 to 1974, everyone *did* decide to redeem their dollars at the same time because the dollar was seriously undervalued with respect to its nominal value in gold (and this was the result of Johnson administration deficit funding for Vietnam and the Great Society).

more than that - there was the counterfeiting and Eurodollar problems there in the background too - but all grist for the mill. Those were causes of a balance of trade problem.

As such the Bretton Woods system broke down.

yup. Except the also-broken Bank for International Settlements was never fixed, nor the IMF...

24, the fact that you don't seem to know what the gold standard (and for that matter what commodity money is) makes it very difficult for me to take anything you have to say regarding economics seriously.

and, the fact that you don't use "is" the way I do makes it hard for me to believe you understand how money itself works. I find it very hard to believe that I would understand the ultra-complex arguments around flags, brands and labels, and simultaneously not understand the simple silly ones around gold. but, it's always possible, certainly the article as it is has benefitted from your rewrite, and from my bringing up the issue of non-convertibility and insolvency. 24

Currently the first paragraph reads as follows:

The gold standard was a monetary system in which paper money was convertible on demand into gold. Under such a system money represents gold: coins are made of the corresponding amount of gold, and/or coins and notes represent an amount of gold held in a vault somewhere. Banknotes were issued fractionally backed by gold (i.e. gold reserves were a fixed proportion of the value of the notes in circulation). Rates of exchange between countries were fixed by their currency values in gold. Most financially important countries were on the gold standard from 1900 until its suspension during World War I because of the problems of transporting gold. It was reintroduced in 1925 but finally abandoned in 1931.

Several issues with this:

With regard to "Banknotes were issued fractionally backed by gold" etc. This is inappropriate. It is not part of the "Gold Standard" but part of the Fractional reserve banking system and therefore does not belong on this page.
Regarding "Rates of exchange between countries were fixed by their currency values in gold" This issue is handled further down the page. The repeat, in this sentence should be removed since it does not need double treatment when it covered properly further down.
With regard to "gold standard from 1900 until its suspension during World War I because of the problems of transporting gold" This is simply not true. Gold is transported even now, and often gold does not need to be transported, but simply becomes reallocated in the COMEX vaults et. al. More to the point, it is a silly thing to say on the face of it. If transporting live cattle, copper, aluminium, rice, corn, and wheat by ship is economically viable, then why not gold? If User:172 has reason for this comment, then I would be interested in reading about it.
With regard to "It was reintroduced in 1925 but finally abandoned in 1931." This is untrue on the face of it. There is no mention where "it" was reintroduced in 1925. In fact what was "introduced" was the Gold Exchange Standard in Britain and parts of Europe, not the gold standard per se, and I believe that was in 1926, not 1925.

Here is my suggested replacement for the currently rather muddled and inaccurate first paragraph:

When banknotes were issued fractionally backed by gold (i.e. gold reserves were a fixed proportion of the value of the notes in circulation) this was the Fractional reserve banking system, and should not be mistaken for a true Gold Standard.

I suggest User:172 cease attempting to revert this page to eliminate these changes. -- Octothorn 20:09, 17 Aug 2003 (UTC)

Quit trying to get away with pushing an agenda. So far you've been able to do it because the articles dealing with economics have always gotten a low degree of interest around here. Articulate the distinctions between the prewar "classical gold standard" and the postwar "gold exchange standard" in this article, if you want. Please review the NPOV guidelines so that you'd realize that it is inappropriate to try to sneak in your advocacy piece and veiled theses. The Gold Exchange Standard was a gold standard, just not a restoration of the classical prewar system per se. I added a good deal to the article since, and it should clarify what set the classical gold standard and the Gold Exchange Standard apart. 172 07:29, 18 Aug 2003 (UTC)

Volunteer to make it less UK-US centered? --Ann O'nyme 21:15, 31 Aug 2003 (UTC)

Sure, go for it. I would've done it much earlier had I had time. 172's been fairly inactive for the past few weeks. Next week, however, I'll make my presence known once again. 172 22:26, 31 Aug 2003 (UTC)

The History section has a rather large chronological jump from the Sumerians directly to the year 1824. Volunteer for some history in between, particularly with regards to the large Spanish movements of gold and silver from the New World to the Old and what effect that had? Tempshill 06:25, 23 Oct 2003 (UTC)

Move here for discussion

Nixon's move to cease allowing foreign Governments to redeem dollars for precious metal was the final act in a 150-year-long 'transfer' of the citizen's gold and silver to the Federal Government's vault. This allowed the U.S. Government to have much more freedom in determining the rate of printing and volume in circulation of its fiat currency.

Need source

Tantalum is also suggested as an alternative money supply standard, since even in an economy based on molecular engineering it would remain extremely difficult to forge - and remain quite easy to hide.

Roadrunner 00:48, 30 Apr 2004 (UTC)

A proposal was floated to stabilize exchange rates between France, Great Britain and the United Kingdom based on a system of drawing rights, but this too collapsed. I have changed Kingdom to read States as I assume that was what was originally intended. --Spencer BOOTH 07:17, 15 Jul 2004 (UTC)

The picture at the top is far too large and doesn't really add much to the article. Could someone reduce it to a smaller png and put it in a more appropriate place? Lisiate 00:09, 28 Jul 2004 (UTC)

"a questionable assumption in light of the spending binge of George W. Bush" removed from the Washington concensus secion. It just seemed too POV. I am, however, not sure how to word it better. -Vina 20:30, 3 Aug 2004 (UTC)

cited source of the contention - namely the International Monetary Fund. That Bush has run up massive deficits, that those deficits are structural and that they are destabilizing the international currency system are matters beyond dispute, and are not disputed by anyone not employed by the RNC or its subsidiaries. So sorry, facts are stubborn things here. Stirling Newberry 23:23, 3 Aug 2004 (UTC)

ahem, try debt vs. GDP (or debt as % of GDP). Plenty of sources. The US debt currently is lower than it is in the early 1990's. The rate of increase is high, that is not disputed, but neither is it higher than the rate of increase in the late 1980's and early 1990's. So sorry, facts are stubborn things here. -Vina 23:31, 3 Aug 2004 (UTC)

Did some more research on the IMF site. Included a summary in that section. Note that they are concerned about trends exhibited since 1999, and that they are also concerned about household spending. Hopefully this is more acceptable to you? -Vina 00:25, 4 Aug 2004 (UTC)

I will not be editing this page any more as I do not believe in getting to edit wars. In closing, I will mentioned that I still think what you wish to add is POV, not extremely, but still POV. -Vina 05:11, 4 Aug 2004 (UTC)

I'm reporting what the IMF has said about the need for a stable anchor currency and current US fiscal policy. "Tax increases will be needed to maintain the stability of the US dollar". It's also what comes straight out of the Fleming-Mundell model, namely that running a consistent budget deficit will continue to negatively impact the balance of trade, and therefore devalue the dollar. Find a model that says otherwise, and report on what it says. Stirling Newberry 08:31, 4 Aug 2004 (UTC)

Sigh, I never objected to the model, merely the personal attack. In all my research, I've only seen the comment on Jan 7, 04 about Bush, and that was 1 paper published by 1 analyst. In no other statement does the IMF come across so harshly, not even when it criticised the tax cuts 2 years ago did it comment that harshly (incidentally, the IMF now acknowledges the role the tax cuts did in bringing the world out of recession.) The papers that you refer to, those released July 30th, and accessible from the IMF front page, do not mention Bush by name (At least, what I (did not) find via an Acrobat Reader search.) Statements like the foreign debt being an "unprecedented" 40% of GDP is without base (the unprecedented part, not the 40% part) as Japan has one above 100%, and many euro nations are hovering around 70%. I have not seen the IMF follow up on the Collyns paper all that much. They have valid concerns, and writing about them is perfectly fine with me. it's the personal attack part that I feel is POV. -Vina 16:39, 4 Aug 2004 (UTC)

Sigh again - someone else proposed the tax packages? They were submitted to congress by Bush, who in fact wanted larger revenue reductions in 2003 than were finally passed. Again, "attacks" and what people wanted to be said are all well and good, but the documentable facts at hand are: 1. The tax policy is driven by the current US executive 2. Every economic model I have seen - including the ones from OMB and CBO - indicate structural deficits and continued devaluation of the US dollar. If you feel someone else is responsible for the tax reductions, I am sure we'd all be fascinated to know who that is. If you have a model which indicates that the IMF is wrong - and they've been wrong before - then by all means present it. I simply haven't found one. Stirling Newberry 00:44, 5 Aug 2004 (UTC)

Why were the sections "Post-War International Gold Standard (1946-1971)" and "The Washington Consensus" removed? They were acting as summaries of main articles. 172 01:01, 5 Aug 2004 (UTC)

Space considerations, and because as the author of the history section, it was better and more consistent to refer to the more extensive Bretton Woods article, so that issues could be resolved once, rather than multiple times. I've removed the Washington Consensus section because it is clear there are issues that need to be resolved which are not germane to the question of a gold standard per se. Stirling Newberry 01:15, 5 Aug 2004 (UTC)

And as the author of the more extensive Bretton Woods article, I think that there ought to be condensed summaries of that article available in entries on broader, encompassing topics. Some readers like detail while other types of readers want the most important facts in a condensed format. Space considerations are not a major concern; there are plenty of articles on important, broad, and complex subjects that take up well over 32K. 172 01:29, 5 Aug 2004 (UTC)

Just to add to the above, I'm not saying that a summary of the Washington Consensus article belongs here. However, at least a few concluding remarks on the Washington Consensus that are germane to the question of the gold standard will be helpful. 172 01:40, 5 Aug 2004 (UTC)

With regard to the following paragraph in the text:

"After the collapse of the empire in the West, and the decline of the mines in Europe which were largely played out, the Byzantine empire continued to mint successor coins to the solidus, called the nomisma or bezant. They were forced to mix more and more base metals with gold, until by the turn of the millennium the coins in circulation were only 25% gold by weight, a tremendous drop from the 95% pure old Roman coins. Increasingly trade was conducted in a coin struck in the Arabic world using gold from Africa: the dinar."

In the first sentence, whiile the Bezant was the successor coin to the Solidus, they became two names for the same coin [1]. The Greeks of the Byzantine Empire now called the old circulating Solidus by the name of the new Byzantine issues of the old coin, the Bezant [2].

The second sentence beginnning with the words "They were forced..." is inappropriate. "They" - the Byzantine Empire - were not forced to degrade the purity of the coin. If they were, someone ought to provide the text with some indication of what it was that "forced" them, otherwise the use of the word "forced" should be removed.

The reason for the degradation of the coin is simple, and nobody was forced do do so - "they" just wanted to be able to mint more coins for themselves using the same amount of gold. This is the same reason any government has ever had for degrading the purity of gold coins, a form of embezzlement - they get something for nothing.

More importantly, however, that sentence is inaccurate. The Bezant was not degraded as quickly as indicated. It circulated from the early fourth century, continuing until Emperor Michael IV (1034 - 1041) began to degrade it's purity. Prior to that tiime the Bezant circulated at it's full weight and purity. The Bezant was therefore stable for a period of about 700 years [2].

The final sentence is also inaccurate. The Dinar was modelled on the Bezant and the earlier Solidus [1][2]. Essentially it was the same coin, just minted by the Arab Empire. Consequently both the Dinar and Bezant circulated alongside one another. The text should also draw attention to the fact that the Dinar circulated for about 450 years unchanged, from the late 7th century to the mid-12th century, during which time the Saracen Arab civilisation flourished until it callapsed in religious turmoil.

The Solidus the Bezant and then the Dinar were all gold coins of the same gold content (4.4 grams at 22 carats) which at times circulated alongside one another. In this way a gold standard based on a single form of gold coin was maintained for a thousand years, surviving three empires.

References:

[1]"Trade Coins" http://www.cyberussr.com/hcunn/gold-co.html, by Hugo S. Cunningham -- Valid as at 2004-09-06T11:00:20+10:00

[2]"Gold Wars", by Ferdinand Lips, 2001, Pages 3-6.

[3]"Roman Imperial Coinage" http://www.roman-britain.org/coinage.htm -- Valid as at 2004-09-06T11:00:20+10:00

Octothorn 01:06, 6 Sep 2004 (UTC)

Even your own references contradict you - the solidus was debased repeatedly over time, and was, in itself, an attempt to debase the aureus. Stirling Newberry 20:11, 27 Dec 2004 (UTC)

Um... Where? And, how in the world would one coin be used to debase another? Coins don't debase coins, people debase coins. The Aureus was already very much reduced in size by the time the soludus was produced. The solidus replaced the aureus. Perhaps you are confusing "replaced" with "debased". Octothorn 07:33, 6 Jan 2005 (UTC)

The following paragraph near the beginnning of the text appears to be silly, and wording should be reconsidered:

"Typically under a gold standard, the physical transport of gold becomes cumbersome for popular use, and so promissory notes? (which may be either issued privately or by government) to pay in gold at a later date, circulate. These note are convertible into physical gold on demand. Also known as demand notes?, (see paper money)."

The idea that "physical transport of gold becomes cumbersome for popular use" is amusing. An 8 gram gold coin (nominal value of $5) carries US$100 worth of gold. Notes larger than $100 are seldom used. While a $100 note may not be quite as "cumbersome" as such a coin, the coin is certainly more durable. One may also suggest that if a single 8 gram coin representing $100 is "cumbersome for popular use", then the quarter, currently in "popular use", must then be over 400 times more cumbersome than a gold coin.

Originally large volumes of gold were required to make large purchases. While carrying 100 dollars worth of gold is not a problem, the volume of gold required for the annual wheat import of Rome would run a great deal more. The cost in silver of a chest of opium weighed thirty times as much as the chest itself. And in the present, larger bills are less common because of checks, credit cards and other instruments. That is to say, because even paper money is too cumbersome for popular use. Stirling Newberry 20:11, 27 Dec 2004 (UTC)

Surely you haven't forgotten that checks are claims on bank deposits, not money. If a cheque is written it does not add to the money supply, it's just a note to the bank to move money from one place to another.

Also, credit is credit, not money. Credit is a debt instrument. If I charge something to my credit card it does not increase the money supply.

Neither cheques nor credit can circulate as currency - they are not divisible, and they rely on the presence of sufficient bank deposits or the capacity to make payment in currency.

The text suggests that gold is more cumbersome than cash, but that is not true. Notes, originally issued as claims on a quantity of gold, are now so devalued that they are about as cumbersome as gold. Suggestions that gold is more cumbersome than fed reserve notes are not relevent or constructive to the issue, and the comment as it stands lacks NPOV ansd should be removed. Octothorn 07:58, 6 Jan 2005 (UTC)

The subject of notes should still be raised, since the page carries an image of one. What follows is a possible replacement:

The use of gold coins in large transactions is time consuming and prone to error. Centuries ago the market found a solution to this problem. Goldsmiths would issue notes of claim on gold coins deposited with them. Those coins were not spent, but were held in reserve to cover the notes that were issued. Each transaction involving a large amount of gold was easier with a note. Many consecutive transactions using one note could proceed smoothly. Coins would not need to be counted or transported until the note was redeemed, and each note could be exchanged for goods over and over.

This has also been true in more recent times, as with the 1922 U.S. Gold Certificate shown on this page. This $100 note was a claim on about five ounces of gold coins, or $2000 worth of gold in the year 2004. Notes similar to that pictured were issued to the depositor as a claim on gold coins.

The benefit of using something like the replacement above is that it outlines the need for notes in large transactions and the function of gold certificates. It also links the text to the image, giving the reader some perspective on what the note is worth.

Octothorn 04:29, 6 Sep 2004 (UTC)

graf was replaced with a graf on the general advantages of paper money within the context of a specie based monetary system Stirling Newberry 20:11, 27 Dec 2004 (UTC)

[edit] Needs more pictures

For a featured article, especially now highlighted on the main page, this article needs more pictures. I added one of gold ingots held by the Bank of Sweden, but I'm sure others could be found. Curiously, I could not find one image of a gold coin on Wikipedia. Perhaps you may have better luck than I, or find other relevant images.--Pharos 20:22, 21 Jan 2005 (UTC)

Britain was almost immediately forced to gradually end its gold standard

Immediate and gradual at the same time? Ubermonkey 21:16, 21 Jan 2005 (UTC)

[edit] too long..

Interesting, but too long and often redundant. The proponats' and oponents' viewpoints are presented over and over again, this needs to be made more compact.

[edit] "doubloon"

There is no such thing as a doubloon in Spanish. It should read "doblón".

[edit] Early coinage section not relevant?

IMHO The section on "early coinage" does not belong in this article. Shouldn't it be in an article on the history of coins?

Could somebody more knowledgable than I do it?

[edit] 1879: Austria

Austro-Hungarian krone claims it was in 1892. I agree with it. Austria-Hungary has the single currency. -- Vít Zvánovec 09:05, 29 September 2005 (UTC)

[edit] Reverting to my edit

I made edits to this page, though which were all reverted by User:Stirling Newbury. I've reverted them again to my version, with an explanation here of the edits:

links such as London Conference and Washington Consensus link to the wrong conference, and the Washington Consensus has nothing to do with the Washington Agreement, hence my deletion of the link. Furthermore, the Wikipedia:Manual of Style (links) suggests its better not to have links to every year, century, etc, unless one is talking about a specific date.
The plural of crisis really is crises..
Not sure why SN deleted the dubious after Austria. See talk above.
Greenback has written one article about his support of the gold standard, when the dollar was still convertible into gold almost forty years ago. To suggest that he supports a return to the gold standard is a claim made on many gold standard blogs, but I believe more evidence is needed for that claim.
Barro wrote an article where he said "The choice among different monetary constitutions -- such as the gold standard, a commodity-reserve standard, or a fiat standard with fixed rules for setting the quantity of money...may be less important than the decision to adopt some monetary constitution. On the other hand, the gold standard actually prevailed for a substantial period (even if from an "historical accident," rather than a constitutional choice process), whereas the world has yet to see a fiat currency system that has obvious "stability" properties." As this was in 1979, it is clear that he makes a reservation about the fiat currencies, as they hadn't been in place for long (the dollar without gold convertibility only for 8 years). I do not believe this implies that he supports the gold standard.
" several other nations accumulated gold in preparation for the Economic and Monetary Union" implies that Eurozone countries overall increased their stock of gold. They did not, as the data explains.
"Gold standard advocates have a strong following among commodity traders and hedge funds with a bearish orientation." - this implies that speculators such as commodity traders and hedge funds want a return to the gold standard. This is the last thing they want! It will kill their business. There is a reason that the IMM was set up just after the collapse of the Bretton Woods system - it meant volatility in FX markets, so more business and profits for them. Bearish traders do invest in gold, as they hope the price goes up in times of panic.
"fiscal meltdown" - what does this mean, that budget deficits explode..??
"many hedge financial theories" - no idea what this is supposed to mean.
"Mainstream conservative economists such as Barro and Greenspan have admitted a preference for some tangibly backed monetary standard, and have stated that a gold standard is among the possible range of choices." As this was either 40 years ago (and not since then), or not very strongly (see above), it seems this line is only here to try to increase credibility for the gold standard.
Saying the use of gold as a reserve has increased suggests that the amount of gold has increased. It hasn't. Also, most countries (and the IMF) value their gold at cost price, so gold didn't even replace other reserves when the gold price rose.

Let me know what points you disagree with, and we can have a discussion. DocendoDiscimus 09:01, 31 October 2005 (UTC)

[edit] Ambiguous?

From the article: "Coins were struck in smaller and smaller amounts..." Should this be "smaller and smaller quantities" or "smaller and smaller denominations"?

[edit] Valuation of Gold available vs Money supply in the world...

The section that reads:

"Finally the quantity of gold available for reserves, even if all of it were confiscated and used as the unit of account, would put the value of gold upwards of 5000 dollars an ounce on a purchasing parity basis."

I can't find anything to verify the value of $5000 USD if all currency were converted into Gold. I understand that Purchasing Parity is different from Money Supply, but the comment doesn't address the concept that during said conversion a great deal of overextended moneys upply would instantly contract, but it's almost impossible to determine to what degree or the effect, so the only reasonable comparison we can make is to M3. All research I've seen along these lines, using *just* the United States M3 money supply puts the value up around $32,000 USD and growing along with M3. As can be easily determined, converting the entire worldwide money supply into a system where Gold Troy Ounces are the unit standard, this value would be several multiples higher. There is plenty of credible research showing (though naturally arguable) that a value of $5000 USD is easily approachable in the current financial situation within the next few years. Charlie Wiederhold 11:03, 15 January 2006 (UTC)

Secondly, this comment is very POV and I feel needs to be adjusted. I'm commenting here as to why:

"If the current holders of gold imagine that this is the price that they will be paid for giving up their gold, they are quite likely to be disappointed."

There is no way to verify or predict this scenario. There is no timeline given. If people expected $5000 USD *today*, of course they would be disappointed. Wait 50 years though and inflation alone under the current system will easily outpace this nominal USD value. On a purchasing power basis, it's quite simple to show that One Troy Ounce is easily over $5000 2006 USD compared to when the Dollar and Gold were linked. Some basis of comparison is required in order for any comments like this to have any meaning. This is why *any* commentary on fiat vs tangible assets is tricky and easily manipulated one way or another. Charlie Wiederhold 11:03, 15 January 2006 (UTC)

[edit] "Zero Sum Gold Standard" largely nonsense

The following section from the article contains many major problems contributing to a particular POV that is neither accurate nor intellectually honest:

In the international gold standard imbalances in international trade were rectified by requiring nations to pay accounts in gold. A country in deficit would have to pay its debts in gold thus depleting gold reserves and would therefore have to reduce its money supply. This would cause prices to deflate, reducing economic activity and, consequently, demand would fall. The resulting fall in demand would reduce imports; thus theoretically the deficit would be rectified when the nation was again importing less than it exported. This led to a constant pressure to close economies in the face of currency drains in what critics called "beggar thy neighbor" policies. Such zero-sum gold standard systems showed periodic imbalances which had to be corrected by rapid falls in output.

In practice however this could seriously destabilize the economy of countries which ran a trade deficit, because people tended to make a run on the bank to retrieve their money before gold reserves were exported, thus causing banks to collapse and wiping out savings. Bank runs and failures were a common feature of life during the period when the gold standard was the established economic system. It also created a counter-cyclical effect, as governments taxed trade, they accumulated gold and silver coin, which reduced the monetary base for the private economy. This paradox lead to "money droughts" and inflation, as governments taxed, often to pay for wars, and paid in coin, while the velocity of money decreased in the private economy as individuals hedged against the uncertain political situation by hoarding gold. Each attempt to introduce paper money was met, sooner or later, with either over-printing of money and the resulting collapse of the "fiat" money, including paper francs, continentals printed by the pre-Constitutional US Congress and various "bubbles". Or it would create the demand by the government to be paid only in specie, which devalued the existing paper money.

The following POV issues with this text are aparrent;

It is true that imbalances in international trade were paid in gold, however under a 100% gold standard, the gold paid matched the notes held, so there was no reduction in the 100% reserve. The author of the paragraph seems to believe that the gold was shipped out from banks while the notes that it was backing were still in circulation. This is not the case, and is fraud under a 100% reserve. The money supply would be reduced, it is true, but the comment in the following paragraph suggesting that this would cause a bank run is entirely false under a 100% gold standard.
Trade deficits were not as significant as the author percieves. Suppose that the trade deficit was caused by the sudden need to import mining equipment from other countries. The best example of this is in a gold rush. Think about the california gold rush. Mining equipment was "imported" but gold was "exported" one might suggest that the outflow of gold was the correction of a trade deficit, but the point is that the gold outflows are a part of the trade.
Payment in gold would appear to cause "deflation" of all goods other than gold. However, the real case is that gold was increasing in value against other goods. This is normal behaviour for a commodity, and it occurs when there is greater demand than supply. The natural response to this is to reduce consumption and to increase supply, as with any other commodity. Gold mining operations in the country paying international debts would naturally increase (increase of gold supply) as would production of goods that would otherwise be imported (decreasing demand for gold for export). This really is basic economics, but the author prefers to call it "beggar thy neighbor" - leading to the final point...
"Beggar thy neighbor" was a term coined to describe the action of the Smoot-Hawley Tariff Act, NOT the action of the gold standard on international trade - the author has used it as the COMPLETE OPPOSITE of the way it was intended. The gold standard was symbol of free and open trade between nations, and the tariff act was the commencement of stifling business and the closing of trade borders. Check this reference - http://www.state.gov/r/pa/ho/time/id/17606.htm

The section "Zero Sum Gold Standard" should either be edited to NPOV, or preferrably removed entirely.

Octothorn 05:18, 16 February 2006 (UTC)

[edit] Jefferson president in 1796?

"...in 1796 President Jefferson suspended the minting of silver coins." Jefferson did not become president until the year 1800. In "silver standard," it reads as 1806, so I've changed it, assuming that article is accurate.

[edit] Trading With The Enemy Act?

"As part of this process, many nations, including the US, banned private ownership of gold using the Trading With the Enemy Act..."

First, the phrasing here is a bit confusing; after all, US laws are irrelevant to other nations. But more importantly: the Trading With The Enemy Act was passed in 1917, and only allowed the Fed to prevent trading with the enemy. US citizens were banned private ownership of gold by FDR's Presidential Order 6102 in 1933, as cited at the bottom of the document.

The paragraph previous to the above quoted sentence talks about the UK returning to the gold standard in 1925. So it seems in the narrative we're already past 1917. And the subsequent paragraph adresses the London Conference in 1933. Surely this section meant Presidential Order 6102, and not The Trading With The Enemy Act?

I don't feel I'm familiar enough with the history to actually change the text. But let me propose an edited paragraph here, at least to get the ball rolling. Ahem:

As part of this process, many nations banned private ownership of gold. For example, in 1933 President Roosevelt signed Presidential Order 6102, which barred American citizens from owning gold. Any citizen "hoarding" gold could face up to ten years in jail, and/or a fine up to $10,000. Jewelry, private coin collections, and the like were exempt from this ban; in any case the ban seems not to have been enforced too zealously. In 1975 these restrictions on American citizens were abolished.

—Larry Hastings 06:07, 24 April 2006 (UTC)

[edit] French Link Missing

On the left there are numerous links to pages explaining the same concept in another language, but the French page is missing. The French translation is "Étalon-or" and there is already such a titled page: http://fr.wikipedia.org/wiki/%C3%89talon-or I don't know how to add it to the list, can anybody do that?

This was apparently done, at some point. - Centrx 23:02, 21 May 2006 (UTC)

[edit] Misspelling: nobel

The reference to nobel is mis-spelt, it should be noble. —The preceding unsigned comment was added by Lawrence Chard (talk • contribs) 21:03, 18 June 2006 (UTC)

Thank you. I have corrected it. Note that anyone can edit Wikipedia, so in the future you are free to make a change like this yourself. —Centrx→talk 03:00, 20 June 2006 (UTC)

[edit] Needs Citation

"Nevertheless, countries under the gold standard underwent debt crises and depressions throughout the history of its use."

Please provide citations with specifics. Currently, the words in this statement are ambiguous enough to make the statement lose meaning. What exactly is a "debt crisis"? How is the term "depression" used exactly? Did it have a negative effect on the private sector, or just the government (which is its intended effect)?

Currently, this just looks like a cheap shot against the gold standard. If this is an honest critique, it needs to be expanded with the mentioned details and citations and put into it's own critique section, or it needs to be removed. --DrDimension 22:25, 24 July 2006 (UTC)

[edit] Greenspan

Is there any evidence that Greenspan supports a gold standard, other than his writings way back in the 60's during his Ayn Rand days? If not, he ought not be counted a current supporter of the gold standard. The comments quoted later in the article do not indicate that he favors a return. Instead, he merely says he thinks it has certain advantages.Kitteneatkitten 03:01, 10 August 2006 (UTC)

Greenspan said in Congressional testimony on 7/22/98: "I am one of the rare people who have still some nostalgic view about the old gold standard, as you know, but I must tell you, I am in a very small minority among my colleagues on that issue."

This seems to imply (which is probably about as close as the Chairman gets) that his position has not changed.

Source: http://www.usagold.com/gildedopinion/greenspan-gold.html —The preceding unsigned comment was added by 70.137.164.61 (talk • contribs).

Some nostalgia is not good enough to state that he "supports a return to the gold standard". Particularly so, since he's free to speak his mind today. That really ought to be stricken, as a quote from 1966 and some nostalgia in 1998 are hardly the stuff of present advocacy.

His most recently scholarly writings, listed below, do not even mention the word "gold".

"Risk and Uncertainty in Monetary Policy" Alan Greenspan. The American Economic Review. May 2004. Vol. 94, Iss. 2; p. 33
"Reflections on Monetary Policy 25 Years after October 1979: Chairman's Remarks" Greenspan, Alan, Federal Reserve Bank of St. Louis Review, vol. 87, no. 2, Part 2 March-April 2005, pp. 137-38
"The Evolving U.S. Payments Imbalance and Its Impact on Europe and the Rest of the World" Alan Greenspan. Cato Journal. Washington: Spring 2004. Vol. 24, Iss. 1/2; p. 1 (11 pages)
"Central Bank Perspectives on Stabilization Policy: Articles from the Bank's 2002 Economic Policy Symposium "Rethinking Stabilization Policy." Greenspan, Alan Federal Reserve Bank of Kansas City Economic Review, vol. 87, no. 4, 4th Quarter 2002, pp. 5-14 Derex 22:55, 29 September 2006 (UTC)

[edit] Gold Ban

This paragraph is seriously disorganized, and I plan to straighten it out. However, there is one factual error where the present version says "many countries prohibited private ownership of gold." I am not aware of any country doing this besides the US, even countries going off the gold standard (of which there were many). I have put a "citation needed" on the statement and will wait a week to see whether anyone provides a credible cite. If not, I plan to delete the statement.--Joe 21:59, 22 August 2006 (UTC)

[edit] 3RR Violations/Edit War

For some reason, [User:Stirling Newberry] is insisting on turning an article regarding an economic subject into an article that details crimes on part of the Nazi Germany Government. I'm sorry, but I see no relationship between the theft of Gold and the Bank of International Settlement and it's relationship to the economic policies of a gold standard, as one has nothing to do with another. Stirling has refused to compromise with me, due to my status as an "IP editor." I have reported him for a 3RR violation, and I will no longer revert as I am at my 3 reverts, but I was wondering if my fellow editors could step in and take a look at this. Thank you 87.19.140.175 20:38, 3 September 2006 (UTC)

[edit] Addressing fallacy of "innate value"

This article avoids the fallacy of "innate value" for gold, which, as any other commodity, only has whatever "value" people assign to it. However, I have seen "innatism" to be fairly common among advocates of a gold standars. Should this article address innatism and arguments against it from various economic schools, such as the Austrian school (hardcore anti-innatist) and whatever schools might be out there that embrase innatism?Dogface 11:04, 11 September 2006 (UTC)

[edit] Gold Restrictions

Central Bank Gold Reserves: An Historical Perspective Since 1945 by Timothy Green (World Gold Council, 1999) says, on Page 13, of the 1931 departure from the Gold Standard by Britain:

The suspension of the gold standard by Britain did not mean that people were forbidden to hold gold bar or coin, merely that the Bank of England did not have to sell gold at a fixed, statutory price. The London gold market worked normally. Banks and individuals could still buy and sell gold, import it and export it, but at the price of the day.

The cited publication may be viewed by clicking the footnote at the end of the second paragraph of this section of the article. The comment concerning the French order to turn in gold also comes from this publication.

The foreign-exchange controls that Britain relaxed in 1971 were not enacted in the 1930s. If you wish to hold that Britain, Japan, or any other country took steps besides suspension of convertibility and export controls (e.g., Germany), please provide citations to support your entries.

Again, confiscations of gold from minorities persecuted by the Nazis did not have perceptible effects on the foreign-exchange position of the German government, nor did any such considerations give gold any sort of priority among the comprehensive confiscations of property perpetrated at that time. If you wish to hold otherwise, please provide citation support. Joe 01:59, 15 September 2006 (UTC)

[edit] I believe this to be a typo, but don't know the currect date

"in 1324 the US government suspended payment in gold and silver" I don't think there was a US government in 1324 146.7.211.82 00:46, 16 November 2006 (UTC)

I reverted this to 1861, however I wasn't able to confirm it from a reputable source, so it may still be incorrect. --69.255.141.119 01:10, 19 November 2006 (UTC)

[edit] Minor Edit for Clarity

As it is my past experience that a significant portion of the US population does not know what "specie" is, I felt it best to link the term to its definition.Filksinger 07:32, 19 November 2006 (UTC)

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