posted on Jan, 24 2012 @ 11:22 AM
reply to post by Observor
Like I said. Not going to pretend to know the gold rates in India. It just seems like a geological location where you would find a lot of it. That's
There is simply not enough gold to back international and domestic commerce in the world at current exchange rate of gold to different currencies. So
it is not possible to back all the existing currencies with 100% gold even if all the gold held, both publicly and privately, were to be concentrated
in the hands of the governments. So what would be the motivation and justification for such a move?
Primarily an FU from a powerful nation to the rest of the world. See although you could not produce gold for all currency, you could revalue it. You
take your gold, you take your population (specifically, your ratios of poor, rich, and middle class), and you divvy it up accordingly.
This is an economic weapon of both mass destruction and last resort. An action that essentially cuts you off from the global economy. Because what you
are doing is vastly deflating worth value to established a fixed exchange rate. Billionaires become millionaires, millionaires become even less, and
the poor have but a few cents. It's a reset button. Erase all the world, and only have that fixed exchange rate based off the parameters of your
gold, and your population's wealth.
Why would you do it? Well, if the world was going under economically and you wanted a way to get out of it, you could do this to cut yourself off from
the world's economic problems. Of course, you could only do this under absolute, north Korean styled, isolationism.
Thing is, it is just as I said. Only to be done in dire cases of complete economic collapse at a global scale.
And to those ends, you could just as easily link the currency to your gdp. cash would be backed by labor and gold. In this case, you end up creating
either a national socialist society, or a labor barter system, or both.