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Federal Reserve Chairman Ben Bernanke has repeatedly expressed concerns about the idea, sometimes even sparring with Paul in Congressional hearings. Research has shown the rigid constraints of the gold standard worsened the Great Depression, he said. Gold prices can also be volatile.
Plus, there's not enough gold in the world to support such a system, as Bernanke noted in a lecture earlier this year.
"To have a gold standard, you have to go to South Africa or someplace and dig up tons of gold and move it to New York and put it in the basement of the Federal Reserve Bank of New York and that's a lot of effort and work," he said.
It's an "awful big waste of resources," he added.
But just in case the idea does gain more traction, here are some rough calculations of what would happen to gold prices, courtesy of Julian Jessop, chief global economist for Capital Economics.
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Related: Professor Bernanke rails against gold standard
ReplyDeleteFederal Reserve Chairman Ben Bernanke has repeatedly expressed concerns about the idea, sometimes even sparring with Paul in Congressional hearings. Research has shown the rigid constraints of the gold standard worsened the Great Depression, he said. Gold prices can also be volatile.
Plus, there's not enough gold in the world to support such a system, as Bernanke noted in a lecture earlier this year.
"To have a gold standard, you have to go to South Africa or someplace and dig up tons of gold and move it to New York and put it in the basement of the Federal Reserve Bank of New York and that's a lot of effort and work," he said.
It's an "awful big waste of resources," he added.
Check today's gold prices
But just in case the idea does gain more traction, here are some rough calculations of what would happen to gold prices, courtesy of Julian Jessop, chief global economist for Capital Economics.