Under a gold standard, the amount of credit that an economy can support is determined by the economy’s tangible assets, since every credit instrument is ultimately a claim on some tangible asset. […] The abandonment of the gold standard made it possible for the welfare statists to use the banking system as a means to an unlimited expansion of credit.
— Alan Greenspan, 1966
BALTIMORE – That old rascal!
Before joining the feds, former Fed chief Alan “Bubbles” Greenspan was a strong proponent of gold and the gold standard.
He wrote clearly and forcefully about how it was necessary to restrain the Deep State and protect individual freedom.
Then he went to Washington and faced a fork in the tongue.
In one direction, lay honesty and integrity. In the other, lay power and glory.
Faking It
Under the Bretton Woods monetary system, the U.S. promised foreign central banks that it would convert their dollars to gold at a fixed price of $35 an ounce.
This constrained the amount of dollars the U.S. could print to the amount of gold it had in its reserves.
A smart man, Greenspan quickly realized he could not advocate for this old, tried-and-true gold standard and run the Deep State’s new credit money system.
In 1987, he made his choice. He took over the top job at the Fed and faked it for the next 19 years.
Since 1978, we have had four different Fed chiefs. Some were smart. Some were honest. Only Paul Volcker was smart and honest.
Bernanke was honest… we believe. As near as we can tell, so is Janet Yellen. Both may mean well, but both are careful not to think out of the Deep State box.
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