Hello Darlings,
First I have to say that I thoroughly enjoyed Quantum of Solace, it’s different in its own way, and obviously they are re-inventing the Bond Universe, but for just plain fun, and lots of popcorn (back to the gym for me) I do recommend it.
Afterwards, Kenneth updated me on what is going on in his life, it seems that with working with a certain company he is being forced to have to travel more to make sure that all parts of it are running in the same direction and it does look like they may have to do cut backs, Kenneth is recommending to hold off on the cut backs until after the Holidays, and see what they can gain through attrition (retirement) which can mean less layoffs than expected and he’s looking at last hired first to let go, unless it’s a specialization. He has a lot of headaches on this, but his feeling is that we won’t see the beginning of a turn around until this time next year. He’s planning to ride this out, make sure that as much as possible is in place with his company and then look at retirement, his finances are in good shape, but he’s thinking of freelancing, there seems to be a demand for that and he says he doesn’t have to remain in one place for a long time.
I’m inclined to agree with him. The news in Barron’s is mixed, the stock market doesn’t know where to go, and I do hope that Mr. Obama will put serious regulations on profit taking.
I am so glad that my head has finally stopped whirling around and around from all the election “hype”, now a President elect is in place. I sincerely hope he does the right thing, especially with the economy.
There is an opinion article in the (Nov. 17, 2008) Christian Science Monitor; the author postulates that it would be good for our economy for the United States to go back to the Gold Standard.
Personally Dahlings I feel that in the long term it would be a very wise move, one needs to look at the various economies of different nations over the last 100 years and see that when they went off the Gold Standard, it was rampant recession and inflation, with goods not being priced at their true value, if we were on the gold standard we would have a true value of what our goods are worth.
But there are some caveats to all of this:
There are over 100 countries that mine gold and sell it on the market.
The five biggest producers are
China
South Africa
United States
Australia
Russia
As you can see only the United States and Australia are the least volatile in gold production or mining.
China out stripped South Africa because labor is cheap there, for they, like some other countries hold life as being cheap.
Here in the United States the primary gold producing countries are Nevada, Alaska, Colorado and California. And we are the second largest holder of gold in the world, yes Dahlings, there is gold in Fort Knox. Approximately about $134 Billion dollars worth as of the gold value in April 2008.
But here is the crux of the problem how does one mine the gold without it becoming an eco-environmental danger. Open pit mine is safest to the laborers but is an environmental disaster. Closed mining is far more dangerous. One can only find so much in placer mining.
And the cost of mining, so what is the best way to get that gold out of the ground? Considering all the up to date mining techniques I think I’d leave that to those qualified.
But I know some of you are asking is the Gold Standard really the way to go?
Lawrence White wrote a paper on that and even answered any objections in his paper that was published in the CATO newsletter of which I will print the summary here and if you go to the CATO website you will be able to read his paper in full.
His paper was presented on Feb. 8, 2008
SUMMARY~~~~~
Is the Gold Standard Still the Gold Standard among Monetary Systems? By Lawrence H. White
Lawrence H. White is the F. A. Hayek Professor of Economic History at the University of Missouri St. Louis and an adjunct scholar of the Cato Institute. He is the author of Competition and Currency, Free Banking in Britain, and The Theory of Monetary Institutions.
No. 100
Critics have raised a number of theoretical and historical objections to the gold standard. Some have called the gold standard a crazy idea.
The gold standard is not a flawless monetary system.
Neither is the fiat money alternative.
In light of historical evidence about the comparative magnitude of these flaws, however, the gold standard is a policy option that deserves serious consideration.
In a study covering many decades in a large sample of countries, Federal Reserve Bank economists found that money growth and inflation are higher under fiat standards than under gold and silver standards.
Nor is the gold standard a source of harmful deflation.
Alan Greenspan has testified before Congress that a central bank, properly functioning will endeavor to, in many cases, replicate what a gold standard would itself generate.
This study addresses the leading criticisms of the gold standard, relating to the costs of gold, the costs of transition, the dangers of speculation, and the need for a lender of last resort.
One criticism is found to have some merit. The United States would not enjoy the benefits of being on an international gold standard if it were the first and only country whose currency was linked to gold.
A gold standard does not guarantee perfect steadiness in the growth of the money supply, but historical comparison shows that it has provided more moderate and steadier money growth in practice than the present-day alternative, politically empowering a central banking committee to determine growth in the stock of fiat money. From the perspective of limiting money growth appropriately, the gold standard is far from a crazy idea.
So Dahlings, what does this all lead to? Simple, if the new president-elect is wise, he should push for the Gold Standard with all nations, and that they should switch to this standard on the same day so that no one country is left dangling as the first.
Of course those countries with a greater gold production will have a certain amount of financial power, and that should be regulated as well.
People are taught to save, if they are wise, and savings is important but the money that you are saving is fiat money, only alleging being back by the governments guarantee that it will buy you a certain amount, but if you look at the value of the dollar against the Euro it has devalued and buys less. Why is that?
Because people speculate; with the gold standard it will reduce that speculation and you will have a guarantee that your dollar is a dollar. Fiat money is only credit dollars and can be rendered worthless if safe guards are not in place.
But do save, to do those emergency repairs that come up, it’s not a bad thing, but remember prices, because of this inflation will go up, so be prepared for that.
And study economic principals to aid you in your Diva life style.
Now this Diva having gone to the gym yesterday and did her aerobic walking this morning, is going to freshen up and meet her friend Irma for a bit of lunch in the City and a bit of shopping, my brother Tom has said that it’s best if we exchange gift certificates for the Grandchildren (my great nieces and nephews) and they can select what they want, an excellent idea and fortunately their parents told me what is their children’s favorite stores.
Must go, my Diva Darlings.
Until Annon, Kisses Darlings.
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