Ron Paul - The Fed Has Lost Control- Why That's Good for Gold & SilverSubmitted by Smaulgld.com on Sat, 08/17/2013 - 13:17
The traditional thinking is that QE helps gold and silver and that stopping QE would strengthen the dollar and further weaken gold and silver.
This post concludes the opposite:
“The United States can pay any debt it has because it can always print money to do that.” Former Federal Reserve Chairman Alan Greenspan responding to a question as to whether United States Treasuries were safe to invest in.
From a (kinda) Gold Standard to Petro Dollars to the Printing Press
Since the end of World War II the United States dollar has traditionally been a strong currency in relation to other currencies. The Bretton Woods Agreement of 1944 established, among other things, that the United States dollar would be the world’s reserve currency. According to this agreement the dollar could be exchanged by other countries’ central banks into gold upon request. This “gold standard” coupled with the United States’ preeminent military and economic position, gave the world confidence that the dollar was as good as gold.
By the late 1960′s after a decade of massive U.S. spending relating to: the space race (resulting in landing a man on the moon in 1969); the cold war with Russian; the Vietnam War and; new and expanding social welfare programs associated with Lyndon Johnson’s Great Society it became clear that the United States was spending far in excess of any gold reserves it might have to back the dollar.
France’s President Charles DeGaulle recognized the potential and actual monetary abuse by the United States under the Bretton Woods agreement: