Thaksin based idea, a Mini-Asian-IMF, gets funding boost

[Reashot Xigwin]

Economic is man made. Why do I need to believe Keynes. I believe Peter Schiff, can I?
Do u know Quantitative Easing? Do you think its fair when US got crisis, they can bail them out with money printing and exporting inflation while we can't?
US dollar was reserve currency in the first place because it was pegged with gold.
I don't understand why you are happy that some other country can cheat by printing wealth.

Because if you learn economic you would know that inequality is inseparable since the dawn of civilization. Anyway it as you say unfair, but QE are needed to stimulate the economy. Look the talk of returning to gold standard is insane do you realize the amount of gold needed for North America alone if so? (an even more insane amount)

 

[Nike]

Economic is man made. Why do I need to believe Keynes. I believe Peter Schiff, can I?
Do u know Quantitative Easing? Do you think its fair when US got crisis, they can bail them out with money printing and exporting inflation while we can't?
US dollar was reserve currency in the first place because it was pegged with gold.
I don't understand why you are happy that some other country can cheat by printing wealth.

Your idea has been used for centuries, quite ancient and the world has experienced so many and much wider financial crisis affected by the fluctuation of the number of gold reserves and production. And do you think the number of gold in this world is enough to backing all of the transactions happened across the globe?

It is not i am support the American with their dollar, but i am support the financial regime in which hold the balance of our financial system and keep them in order.

 

[somsak]

Why on earth is gold enough or not enough a problem at all?

You still use US dollar as currency. I say again I am not against the US dollar.
Instead, I would say that the world should only use US dollar, if US dollar is physical gold convertible.

Gold standard was there until 1970s, and it works fine. Is 1970s an ancient time? If 1970 work, how can you prove that it does not work now?

Do I think that the number of gold is enough? YES, I do.

Because if you learn economic you would know that inequality is inseparable since the dawn of civilization. Anyway it as you say unfair, but QE are needed to stimulate the economy. Look the talk of returning to gold standard is insane do you realize the amount of gold needed for North America alone if so? (an even more insane amount)

What inequality is inseperable?
How can you believe everything you are told in school?
Is what the teacher said in school is absolute truth or matters in the universe?

Its not insane. The price of gold would sky rocket in dollar terms, therefore the real Kilogram of gold you need is not that much. But it is not actually the price of gold that skyrocket, it was the price of US dollar that sink into deep ocean.

No matter how many gold there is, there will be an equilibrium where the price of gold and the infinisimal divide of weight of gold can be use as price of thing.

You need to imagine the world quote everything as the weight.

 

[Nike]

Why on earth is gold enough or not enough a problem at all?

You still use US dollar as currency. I say again I am not against the US dollar.
Instead, I would say that the world should only use US dollar, if US dollar is physical gold convertible.

Gold standard was there until 1970s, and it works fine. Is 1970s an ancient time? If 1970 work, how can you prove that it does not work now?

Do I think that the number of gold is enough? YES, I do.

so you even doesn't know what is bretton wood system is and how they fixated the dollar against the value of gold and what made the collapse of gold standard system and how many countries in this world is falling one after another because the uncertainty of gold/silver standard resulting in economic catastrophe happened since the ancient times and forcing many of them to taking such desperate measure to increasing their gold coffin such as war ?

 

[somsak]

so you even doesn't know what is bretton wood system is and how they fixated the dollar against the value of gold and what made the collapse of gold standard system and how many countries in this world is falling one after another because the uncertainty of gold/silver standard resulting in economic catastrophe happened since the ancient times and forcing many of them to taking such desperate measure to increasing their gold coffin such as war ?

Ok. what economic catastrophe? Can you give an example?

 

[Nike]

The Great depression

The Great depression

 

[alaungphaya]

so you even doesn't know what is bretton wood system is and how they fixated the dollar against the value of gold and what made the collapse of gold standard system and how many countries in this world is falling one after another because the uncertainty of gold/silver standard resulting in economic catastrophe happened since the ancient times and forcing many of them to taking such desperate measure to increasing their gold coffin such as war ?

I will comment in full about all the issues later but Bretton-Woods did not lead to financial crises. It was quite the opposite. The stability of the BW system was a key ingredient in the post-war prosperity period particularly in the US, Germany and Japan. That the US could not sustain it is what led to Nixon liberalising everything including the exchange rate system. This has led to the use of exchange rates as a tool of trade war and the rise of derivatives. Such a liberalised financial system leads to the use of short term capital flows and the reliance there upon - that is why economic crises have increased since the 'Nixon shock' including the '97 crisis and the recent '08 crisis. The solution seems to be greater oversight by governments on capital flows and strong fiscal and monetary policies as set out by the IMF. All fine but the point is that the end of BW has increased economic cyclicality - there's no arguing against that.

so you even doesn't know what is bretton wood system is and how they fixated the dollar against the value of gold and what made the collapse of gold standard system and how many countries in this world is falling one after another because the uncertainty of gold/silver standard resulting in economic catastrophe happened since the ancient times and forcing many of them to taking such desperate measure to increasing their gold coffin such as war ?

I think you're confusing Bretton Woods with the Gold Standard.

But there is no return to the BW system. Pegging the dollar to gold is unworkable but not because of the lack of gold.

The Great depression

The Great depression

The GD was a good 20 years before BW.

 

[somsak]

I will comment in full about all the issues later but Bretton-Woods did not lead to financial crises. It was quite the opposite. The stability of the BW system was a key ingredient in the post-war prosperity period particularly in the US, Germany and Japan. That the US could not sustain it is what led to Nixon liberalising everything including the exchange rate system. This has led to the use of exchange rates as a tool of trade war and the rise of derivatives. Such a liberalised financial system leads to the use of short term capital flows and the reliance there upon - that is why economic crises have increased since the 'Nixon shock' including the '97 crisis and the recent '08 crisis. The solution seems to be greater oversight by governments on capital flows and strong fiscal and monetary policies as set out by the IMF. All fine but the point is that the end of BW has increased economic cyclicality - there's no arguing against that.



I think you're confusing Bretton Woods with the Gold Standard.

But there is no return to the BW system. Pegging the dollar to gold is unworkable but not because of the lack of gold.



The GD was a good 20 years before BW.

You seems to know economy and finance very well, bro. Can you enlighten me why pegging th dollar to gold is unworkable? I think it is workable. Current dollar may not be, because it is highly inflated. However, there must be a way to do it, since it is just adjusting the price level.

Im one who confusing Bretton Wood with Gold standard. Can you please explain?

The Great depression

The Great depression

Can you bring some prove/ or at least some insight, that Great Depression is a "direct" consequence of gold standard?
---------------------------------------------------------------------
I see some people here start to do branding on me.
Some people brand me gold bug, anti US, and communist.

I would say. Yes I'm gold bug. Since Peter Schiff, my teacher, is also branded a gold bug.
(I'm not rich to have real physical gold, only live month by month) But I buy the idea of gold currency.
I would say. No I'm not Anti US. Who has the most gold in this world? Who won WW2 and gain the most gold? Can any one prove me that US had sold too many gold? Since US is the world no.1, gold hoarder in my understanding, how can I pro gold be anti US?
I would say. Who call me communist know nothing about economic and communist model of economic.

 

[Reashot Xigwin]

What inequality is inseperable?
How can you believe everything you are told in school?
Is what the teacher said in school is absolute truth or matters in the universe?

Its not insane. The price of gold would sky rocket in dollar terms, therefore the real Kilogram of gold you need is not that much. But it is not actually the price of gold that skyrocket, it was the price of US dollar that sink into deep ocean.

No matter how many gold there is, there will be an equilibrium where the price of gold and the infinisimal divide of weight of gold can be use as price of thing.

You need to imagine the world quote everything as the weight.

There's not enough Gold on the earth for starter.

 

[Aepsilons]

Sir @LeveragedBuyout can you enlighten some folks here on the dollar to gold dynamic ?

Advanced Thanks, Sir.

 

[somsak]

There's not enough Gold on the earth for starter.

No there are enough. If golds are rare, the price of things with respect to gold will fall. If golds are abundant, the price of thing with respect to gold will rise. We can always divide the weight of gold to infinitsimal small.

Sir @LeveragedBuyout can you enlighten some folks here on the dollar to gold dynamic ?

Advanced Thanks, Sir.

We did that already. And @LeveragedBuyout had shown us the graph that US was worst off after closing gold windows.

 

[Nike]

I will comment in full about all the issues later but Bretton-Woods did not lead to financial crises. It was quite the opposite. The stability of the BW system was a key ingredient in the post-war prosperity period particularly in the US, Germany and Japan. That the US could not sustain it is what led to Nixon liberalising everything including the exchange rate system. This has led to the use of exchange rates as a tool of trade war and the rise of derivatives. Such a liberalised financial system leads to the use of short term capital flows and the reliance there upon - that is why economic crises have increased since the 'Nixon shock' including the '97 crisis and the recent '08 crisis. The solution seems to be greater oversight by governments on capital flows and strong fiscal and monetary policies as set out by the IMF. All fine but the point is that the end of BW has increased economic cyclicality - there's no arguing against that.



I think you're confusing Bretton Woods with the Gold Standard.

But there is no return to the BW system. Pegging the dollar to gold is unworkable but not because of the lack of gold.



The GD was a good 20 years before BW.

I am not confusing one after another my friend, maybe because i am not stating and explaining properly.....


Great depression was caused by Gold Standard system, in which the weaknesses of gold standard has exacerbated world economics after the Great war and most lead the world and middle income power at the times to the great depression.

• The unequal distribution of gold deposits makes the gold standard more advantageous for those countries that produce gold.The gold standard acts as a limit on economic growth. "As an economy's productive capacity grows, then so should its money supply. Because a gold standard requires that money be backed in the metal, then the scarcity of the metal constrains the ability of the economy to produce more capital and grow.
• Mainstream economist believe that economic recessions can be largely mitigated by increasing the money supply during economic downturns. A gold standard means that the money supply would be determined by the gold supply and hence monetary policy could no longer be used to stabilize the economy. The gold standard is often blamed for prolonging the Great Depression, as under the gold standard, central banks could not expand credit at a fast enough rate to offset deflationary forces.
• Although the gold standard brings long-run price stability, it is historically associated with high short-run price volatility.
• Deflation punishes debtors. Real debt burdens therefore rise, causing borrowers to cut spending to service their debts or to default. Lenders become wealthier, but may choose to save some of the additional wealth, reducing GDP
• The money supply would essentially be determined by the rate of gold production. When gold stocks increase more rapidly than the economy, there is inflation and the reverse is also true. The consensus view is that the gold standard contributed to the severity and length of the Great Depression.
• Hamilton contended that the gold standard is susceptible to speculative attacks when a government's financial position appears weak. Conversely, this threat discourages governments from engaging in risky policy
  
• A gold standard provides practical constraints against the measures that central banks might otherwise use to respond to economic crises. Creation of new money reduces interest rates and thereby increases demand for new lower cost debt, raising the demand for money.

 

[somsak]

I am not confusing one after another my friend, maybe because i am not stating and explaining properly.....


Great depression was caused by Gold Standard system, in which the weaknesses of gold standard has exacerbated world economics after the Great war and most lead the world and middle income power at the times to the great depression.

• The unequal distribution of gold deposits makes the gold standard more advantageous for those countries that produce gold.The gold standard acts as a limit on economic growth. "As an economy's productive capacity grows, then so should its money supply. Because a gold standard requires that money be backed in the metal, then the scarcity of the metal constrains the ability of the economy to produce more capital and grow.
• Mainstream economist believe that economic recessions can be largely mitigated by increasing the money supply during economic downturns. A gold standard means that the money supply would be determined by the gold supply and hence monetary policy could no longer be used to stabilize the economy. The gold standard is often blamed for prolonging the Great Depression, as under the gold standard, central banks could not expand credit at a fast enough rate to offset deflationary forces.
• Although the gold standard brings long-run price stability, it is historically associated with high short-run price volatility.
• Deflation punishes debtors. Real debt burdens therefore rise, causing borrowers to cut spending to service their debts or to default. Lenders become wealthier, but may choose to save some of the additional wealth, reducing GDP
• The money supply would essentially be determined by the rate of gold production. When gold stocks increase more rapidly than the economy, there is inflation and the reverse is also true. The consensus view is that the gold standard contributed to the severity and length of the Great Depression.
• Hamilton contended that the gold standard is susceptible to speculative attacks when a government's financial position appears weak. Conversely, this threat discourages governments from engaging in risky policy
  
• A gold standard provides practical constraints against the measures that central banks might otherwise use to respond to economic crises. Creation of new money reduces interest rates and thereby increases demand for new lower cost debt, raising the demand for money.

Na...

You should say the historical time line that shows exactly the cause of the decease is gold standard, and the symthom of the decease is great depression.

 

[alaungphaya]

You seems to know economy and finance very well, bro. Can you enlighten me why pegging th dollar to gold is unworkable? I think it is workable. Current dollar may not be, because it is highly inflated. However, there must be a way to do it, since it is just adjusting the price level.

Im one who confusing Bretton Wood with Gold standard. Can you please explain?


Can you bring some prove/ or at least some insight, that Great Depression is a "direct" consequence of gold standard?
---------------------------------------------------------------------
I see some people here start to do branding on me.
Some people brand me gold bug, anti US, and communist.

I would say. Yes I'm gold bug. Since Peter Schiff, my teacher, is also branded a gold bug.
I would say. No I'm not Anti US. Who has the most gold in this world? Who won WW2 and gain the most gold? Can any one prove me that US had sold too many gold? Since US is the world no.1, gold hoarder in my understanding, how can I pro gold be anti US?
I would say. Who call me communist know nothing about economic and communist model of economic.

The Gold Standard was in use in the 19th and early 20th century where nations backed the value of their currencies to the amount of gold they held in reserve. The big player then was Great Britain and the Sterling (incidentally, previous to this, most countries used silver as a form of exchange or backed their currency against silver but this was abandoned because South America held the largest deposits of silver and therefore was thought to be a threat to 'Northern' hegemony) This smoothed trade but constrained fiscal and monetary policy. This was a major problem after WW1 when European economies could not service their debts and dropped the original Gold Standard off and on until the Great Depression when it was dropped for good.

BW was a system where currencies were pegged to the dollar which was then convertible to gold at a fixed rate. Similar but not equivalent to the gold standard, more like the dollar standard. The difference is that rates could be negotiated with the US and were therefore adjustable. So you had exchange rate stability and some monetary policy independence.

This was not sustainable because the US could not run trade and BOP deficits if IT was the currency pegged to gold i.e. they couldn't honour their (gold conversion) commitments particularly as they were fighting the Vietnam war. So Nixon broke it all.

For me, there are 3 main reasons:-

- political. I doubt the same political conditions exist now that did in 1945. Would countries willingly sign up for a new Bretton Woods? Why would the EU do that now that they have the Euro? They have already delegated monetary control for stability in their region. Why would China sign up to this? Having a dollar reserve would run counter to their objective of having the Yuan become the world's reserve currency.

- can you imagine the number of derivatives that would have to be unwound if BW came back? It would be complete chaos. The big investment banks would not allow it and they have a lot of political capital.

- why would the US sign up to this? They are already the worlds' unofficial reserve currency and they can run whatever monetary or fiscal policy they like by setting their own interest rates and printing money (QE) whenever they need it. There is no incentive for them to join.

 

[somsak]

The Gold Standard was in use in the 19th and early 20th century where nations backed the value of their currencies to the amount of gold they held in reserve. The big player then was Great Britain and the Sterling (incidentally, previous to this, most countries used silver as a form of exchange or backed their currency against silver but this was abandoned because South America held the largest deposits of silver and therefore was thought to be a threat to 'Northern' hegemony) This smoothed trade but constrained fiscal and monetary policy. This was a major problem after WW1 when European economies could not service their debts and dropped the original Gold Standard off and on until the Great Depression when it was dropped for good.

BW was a system where currencies were pegged to the dollar which was then convertible to gold at a fixed rate. Similar but not equivalent to the gold standard, more like the dollar standard. The difference is that rates could be negotiated with the US and were therefore adjustable. So you had exchange rate stability and some monetary policy independence.

This was not sustainable because the US could not run trade and BOP deficits if IT was the currency pegged to gold i.e. they couldn't honour their (gold conversion) commitments particularly as they were fighting the Vietnam war. So Nixon broke it all.

For me, there are 3 main reasons:-

- political. I doubt the same political conditions exist now that did in 1945. Would countries willingly sign up for a new Bretton Woods? Why would the EU do that now that they have the Euro? They have already delegated monetary control for stability in their region. Why would China sign up to this? Having a dollar reserve would run counter to their objective of having the Yuan become the world's reserve currency.

- can you imagine the number of derivatives that would have to be unwound if BW came back? It would be complete chaos. The big investment banks would not allow it and they have a lot of political capital.

- why would the US sign up to this? They are already the worlds' unofficial reserve currency and they can run whatever monetary or fiscal policy they like by setting their own interest rates and printing money (QE) whenever they need it. There is no incentive for them to join.

Bro. You are Expert!
i total agree with you.

- Do you see? You basically say Nixon broke BW because US want to use more than it has. The gold standard/ BW was correct! No one could use more than she/he has except that she/he can borrow. Printing money is cheating.

- Do you see? Currently all big players are basically want to be able to print. I argued against many Chinese PDF forumer here as well, that Yuan printable is not acceptable. It is Yuan convertible to gold that is acceptable.

I totally agree with you. Bro. Currently it is not the technical that prevent gold from return to BW system, but it was because of politics.