X-Post: Greenspan supports Gold Standard on Fox Business
 

Got this from TOAFK in Politards:

http://www.youtube.com/watch?v=caIgP3Mnb6g
(terrible video, but if you turn up the volume it's ok)

He's gone back to his roots:

Gold and Economic Freedom, Alan Greenspan.

He finally sounds like Ron Paul and an Austrian again. Too bad it took decades. [img]/images/graemlins/tongue.gif[/img]

Re: X-Post: Greenspan supports Gold Standard on Fox Business
 

A transcript, by the way:

Host: So then why do we need a central bank?

AG: Well, the question is a very interesting one. We have at this particular stage a fiat money which is essentially money printed by a government and it's usually the central bank which is authorized to do so. Some mechanism has got to be in place that restricts the amount of money which is produced, either a gold standard or currency board or something of that nature, because unless you do that all of history suggests that inflation will take hold with very delterious effects on economic activity.

Later, after some yakking about Ayn Rand:

AG: . . . there are numbers of us, myself included, who strongly believe that we did very well in the 1870 to 1914 period with an international gold standard.

Re: X-Post: Greenspan supports Gold Standard on Fox Business
 

[ QUOTE ]
A transcript, by the way:

Host: So then why do we need a central bank?

AG: Well, the question is a very interesting one. We have at this particular stage a fiat money which is essentially money printed by a government and it's usually the central bank which is authorized to do so. Some mechanism has got to be in place that restricts the amount of money which is produced, either a gold standard or currency board or something of that nature, because unless you do that all of history suggests that inflation will take hold with very delterious effects on economic activity.

Later, after some yakking about Ayn Rand:

AG: . . . there are numbers of us, myself included, who strongly believe that we did very well in the 1870 to 1914 period with an international gold standard.

[/ QUOTE ]

His first answer is just answering why we need a central bank... not whether it is good or bad.

His second quote just talks about how the gold standard performed until 1914... which says nothing about how it performed/would have performed fromthen on.

I haven't watched the clips but if you misunderstood these statements it's likely you misunderstood the whole video as well.

Re: X-Post: Greenspan supports Gold Standard on Fox Business
 

lol @ Boro

Re: X-Post: Greenspan supports Gold Standard on Fox Business
 

[ QUOTE ]
[ QUOTE ]
A transcript, by the way:

Host: So then why do we need a central bank?

AG: Well, the question is a very interesting one. We have at this particular stage a fiat money which is essentially money printed by a government and it's usually the central bank which is authorized to do so. Some mechanism has got to be in place that restricts the amount of money which is produced, either a gold standard or currency board or something of that nature, because unless you do that all of history suggests that inflation will take hold with very delterious effects on economic activity.

Later, after some yakking about Ayn Rand:

AG: . . . there are numbers of us, myself included, who strongly believe that we did very well in the 1870 to 1914 period with an international gold standard.

[/ QUOTE ]

His first answer is just answering why we need a central bank... not whether it is good or bad.

His second quote just talks about how the gold standard performed until 1914... which says nothing about how it performed/would have performed fromthen on.

I haven't watched the clips but if you misunderstood these statements it's likely you misunderstood the whole video as well.

[/ QUOTE ]

You're the one misunderstanding. He says you need EITHER a gold standard OR a currency board or "something of that nature" to check the printing of fiat money (the latter won't actually work at all, but that's neither here nor there), and then goes on to say that the country did quite well under the gold standard for decades. It was oblique, but that's definitely support for a gold standard. It isn't support for a gold standard OVER of a central bank/currency board, but it is definitely support for a gold standard as a POSSIBLE alternative, should society decide to abolish the central bank. He touches on that tangentially during the babbling about Ayn Rand and democracy, but it wasn't particularly clear, which is why I didn't bother to transcribe it. You'll have to watch the whole video to judge for yourself.

Re: X-Post: Greenspan supports Gold Standard on Fox Business
 

You're definitely not understanding his quote and it's actually hilarious that you seem to be trying really hard to do so.

Let me simplify:

(1)

Q: Why do you play poker

A: To make money

Now, let's simplify it a little less with another example:

(2)

Q: Why do you play poker?

A: In order for one to make money he must either get paid to do a job, be a salesman, or play poker (the unspoken ending to this is "I chose to play poker").

DUCY? Gold Standard and currency board are just options of things necessary to control the inflation issues inherent to a system where the government prints money.

Now, substituting:

(1)

Q: Why do we need a central bank?

A: Because the gov't prints the money which leads to blah blah blah

(2)

Q: Why do we need central bank?

A: To control the inherent blah blah of a system where the gov't prints money we need something like a currency board or a gold standard (the unspoken end of this sentence is "we chose a central bank")

Now, I must be really bored at work to have typed all this out. I think it's also because I found it funny.

Re: X-Post: Greenspan supports Gold Standard on Fox Business
 

Sorry, I had that typed up for a really long time and never clicked submit because I actually had to do something at work.

[ QUOTE ]
It was oblique, but that's definitely support for a gold standard

[/ QUOTE ]

No.

How about this?

Q: Why do we need planes?

A: Well we need a mode of transportation for goods and services therefore we need something like wagons or trains or planes.

... There are a number of us, myself included, who thing wagons served this purpose very well in the 17th century.

This does not imply that wagons > trains and planes.

Re: X-Post: Greenspan supports Gold Standard on Fox Business
 

[ QUOTE ]
blah blah blah

This does not imply that wagons > trains and planes.

[/ QUOTE ]

Which was never claimed. And explicitly NOT claimed. Do you see why?

Talk about hilariously struggling to understand something simple.

Unreal.

Q: Why do we need a central bank?

A: Well, you need either a gold standar OR a currency board OR something of that nature to constrain government from over-inflating a fiat money supply. Also, an international gold standard worked very well in the past.

I.e. he clearly says you need either something like a central bank or a gold standard, and clearly says that the gold standard worked fine. Like I said, I never said that he supported the gold standard INSTEAD of, or OVER a central bank.

You are really reaching.

Re: X-Post: Greenspan supports Gold Standard on Fox Business
 

Sorry that should not have been a > sign. too late to edit

=

Re: X-Post: Greenspan supports Gold Standard on Fox Business
 

[ QUOTE ]
A transcript, by the way:

Host: So then why do we need a central bank?

AG: Well, the question is a very interesting one. We have at this particular stage a fiat money which is essentially money printed by a government and it's usually the central bank which is authorized to do so. Some mechanism has got to be in place that restricts the amount of money which is produced, either a gold standard or currency board or something of that nature, because unless you do that all of history suggests that inflation will take hold with very delterious effects on economic activity.

Later, after some yakking about Ayn Rand:

AG: . . . there are numbers of us, myself included, who strongly believe that we did very well in the 1870 to 1914 period with an international gold standard.

[/ QUOTE ]

Nice quote! Greenspan is now working for Bill Gross who has a number of commodity indexed funds he had been promoting. I think a bet on inflation is a good one. There will never be a gold standard and a monetary policy board will always sucuumb to the pressures created by credit squeezes. Milton Friedman had it right, monetary growth should be stable, low and predictable without any attempts to fine tune the economy. He is considered old fashioned. Do you see why?