Thursday, March 10, 2011

Is Utah Making The Right Choice?

Great. Now Everyone's a Gold Miner.

Here are some problems with this well meaning bill:
1. It limits the people to gold and silver, rather than the principals that make gold and silver work - namely that you do not have to borrow it for it to exist as a medium of exchange, just work for it. If the bill gets signed then the only way to have a debt free medium of exchange, is to mine some more gold. It would be better to use infrastructure than gold - same principals, much better outcome.
2. There is not enough gold to to run the economy.
3. As more gold flows to Utah, the price will trend up as demand goes up. Then, presumably more people will get into gold mining, to meet the growing demand and "cash in" on the next big gold rush - especially if the idea is enacted in other areas.
4. Banks will buy up the gold with their unlimited "checkbook money" causing the price to go even higher.
5. Banks will also buy up more of the mines they do not already own and eventually will price fix and create scarcity - like they did in Zimbabwe. Like they always do.
6. The people will STILL be dependant on the banks and MANY will slip deeper into poverty. Again, see Zimbabwe.
7. A GREAT opportunity will be missed, to shed this fanatic religiosity over gold and the "gold standard", that people don't really understand anyway, and to move to "wealth based money" using the same principals as gold, while allowing a rebuilding of America's infrastructure, jobs for anyone who wants one and a cleaner, more just society. Missed.
Gold is not the answer. Wealth based money is.