Aug 4, 2011 7:13 am
With gold at record highs thanks to the re-emergence of what looks to be a debt crisis, would it make sense to revert to a bimetallic standard? First off, why silver and gold, over, say, rubies or diamonds?
Well, it begins with composition. These elements are on the periodic table. They are also relatively inert, and can be easily melted into purification. And they are both rare, although gold is more so than silver. The value of gold and silver works against inflation, since there is only so much of it in the earth's crust while paper money can be printed on demand.
Since the U.S. has abandoned a bimetallic standard, the world market has become much less stable. Wouldn't it be easier if we all started selling silver jewelry and exchanging our cash with the Treasury for gold and silver, the way it used to be?
There's no way of telling yet. Even if a double dip recession is in the immediate future, it will be a while before such a reversion takes place. All I know is that I'm going to start selling silver coins and flatware for cash. Now's the time to get a return on all the precious metals I already have.
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