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Very Hot Topic (More than 25 Replies) The Return to the Gold Standard (Read 538 times)
BobK71
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Re: The Return to the Gold Standard
Reply #60 - Sep 12th, 2018 at 8:58am
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Jeff wrote on Sep 11th, 2018 at 10:39am:
Has any government ever deflated the supply of it's fiat money?


During the classical gold and silver standard period, interest rates were raised after a financial crash, in order to 'defend the gold/silver standard.'  This generally deflated the money supply and made the public's suffering even worse.  The Great Depression was the first time when a pure form of this play was prevented from happening by public pressure.  Even though the power of the public generally increased in the West over the 20th century, we still see a good part of this play today: after the 2008 crisis, what accommodating policy there was (QE, Stimulus package, TARP, etc.) was still carefully calibrated to be the minimum necessary to prevent a full rebellion against the state-bank system from lost savings, jobs and business after 2008.
  
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Jeff
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Re: The Return to the Gold Standard
Reply #61 - Sep 12th, 2018 at 9:08am
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BobK71 wrote on Sep 12th, 2018 at 8:58am:
During the classical gold and silver standard period, interest rates were raised after a financial crash, in order to 'defend the gold/silver standard.'  This generally deflated the money supply...
I understand rising interest rates during an economic correction to be a natural process of free markets, just as it's natural for interest rates to fall during times of economic expansion.

I wasn't aware that the government had any power to set interest rates during the time when gold/silver was being used as money...

How did they do it?

Anyway, that's not to the point of my question, which asked if any government has ever deflated the supply of it's fiat money.
  
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Andrew_Armao
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Re: The Return to the Gold Standard
Reply #62 - Sep 15th, 2018 at 4:18am
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BobK71 wrote on Sep 12th, 2018 at 8:58am:
During the classical gold and silver standard period, interest rates were raised after a financial crash, in order to 'defend the gold/silver standard.'  This generally deflated the money supply and made the public's suffering even worse.  The Great Depression was the first time when a pure form of this play was prevented from happening by public pressure.  Even though the power of the public generally increased in the West over the 20th century, we still see a good part of this play today: after the 2008 crisis, what accommodating policy there was (QE, Stimulus package, TARP, etc.) was still carefully calibrated to be the minimum necessary to prevent a full rebellion against the state-bank system from lost savings, jobs and business after 2008.


The great depression happened after they lowered tariffs from a blanket 25% across the board. There has traditionally been a little give for gold/silver value, but if you've been alive for the last 200 years, you'd be ticked. The whole Vietnam war may have been just a sham to empty the treasury so we HAD to go off the gold standard. Complete corruption.
  

Andrew J Armao
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SkyChief
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Re: The Return to the Gold Standard
Reply #63 - Sep 18th, 2018 at 12:04pm
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W. Virginia Rep. Alex Mooney proposes an amendment [H.R. 6790] to the Internal Revenue Code of 1986 to clarify that gain or loss on the sale or exchange of certain coins or bullion is exempt from recognition.

IOW, gold and silver American Eagles are considered legal tender, and should NOT be subject to taxes.

I fully agree.   Smiley

https://www.congress.gov/bill/115th-congress/house-bill/6790
  
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Jeff
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Re: The Return to the Gold Standard
Reply #64 - Sep 18th, 2018 at 4:27pm
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SkyChief wrote on Sep 18th, 2018 at 12:04pm:
W. Virginia Rep. Alex Mooney proposes an amendment [H.R. 6790] to the Internal Revenue Code of 1986 to clarify that gain or loss on the sale or exchange of certain coins or bullion is exempt from recognition.

IOW, gold and silver American Eagles are considered legal tender, and should NOT be subject to taxes.

I fully agree.   Smiley

https://www.congress.gov/bill/115th-congress/house-bill/6790
Yeah right, Gold Eagles are legal tender.

I'll swap you a twenty dollar FRN for your Gold Eagle... Good on you Chief!
  
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Jeff
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Re: The Return to the Gold Standard
Reply #65 - Sep 18th, 2018 at 4:30pm
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Oops, I should have asked if he's going to profit from not being taxed on his profits in bullion?

Does his bill have co-sponsors?

All of them should probably be investigated.

I bet there's a good corruption story behind it...

Edit: It just now occurred to me, tons and tons of bullion have been exchanging hands lately... (Not my hands Cry) and now some Congresscritter comes up with the idea of exempting profits on bullion trading and speculation from taxes?

  
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SkyChief
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Re: The Return to the Gold Standard
Reply #66 - Sep 18th, 2018 at 4:47pm
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Jeff wrote on Sep 18th, 2018 at 4:30pm:
Oops, I should have asked if he's going to profit from not being taxed on his profits in bullion?

Nobody will "profit" if American gold and silver Eagles become tax exempt. It just means that the people who use them for trade won't be penalized with an added tax.


Jeff wrote on Sep 18th, 2018 at 4:30pm:
Does his bill have co-sponsors?
All of them should probably be investigated.

I bet there's a good corruption story behind it...

There really isn't any corruption behind it. Mooney is just trying to eliminate a stupid tax.

He has lots of libertarian support. 
  
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Jeff
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Re: The Return to the Gold Standard
Reply #67 - Sep 18th, 2018 at 4:56pm
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SkyChief wrote on Sep 18th, 2018 at 4:47pm:
Nobody will "profit" if American gold and silver Eagles become tax exempt.
Somebody who buys pantloads of them now, and pantloads of gold bullion too, is likely to profit hugely in the near future... (Disclaimer, I'm always wrong, and the guys with smart consultants and high powered lawyers and mega-firm consultants on hand usually do better speculating on gold, especially if they have lobbyists and bought Congresscritters.)

Edit: Embarrassed I forgot. Billions in tax exempt profits amount to many more billions in your pocket.
  
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Jeff
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Re: The Return to the Gold Standard
Reply #68 - Sep 18th, 2018 at 5:01pm
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SkyChief wrote on Sep 18th, 2018 at 4:47pm:
There really isn't any corruption behind it. Mooney is just trying to eliminate a stupid tax.

He has lots of libertarian support. 
Yes, I expect the "taxes are theft" people would be stupid enough to accept a completely unjustified exemption from paying taxes on profits you made by investing in gold.

Please explain why the tax is stupid. Thanks.
  
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SkyChief
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Re: The Return to the Gold Standard
Reply #69 - Sep 19th, 2018 at 11:48am
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Jeff wrote on Sep 18th, 2018 at 5:01pm:
Yes, I expect the "taxes are theft" people would be stupid enough to accept a completely unjustified exemption from paying taxes on profits you made by investing in gold.

Please explain why the tax is stupid. Thanks.
All taxes are stupid. 

But this one is uniquely stupid because Gold and Silver American Eagles are coined by the U.S. Mint. They are Constitutional money.

Taxing coins minted by the US mint makes as much sense as taxing US postage stamps thinking that someday they might become collectible.
  
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