Wednesday, June 22, 2011

"Father" of the Euro Calls for Gold Backing of the Euro

Too bad Robert Mundell didn't think of that when he laid the groundwork for the euro. To me this looks like a retreat of the globalists. They know the euro (and the dollar) are in trouble and fear a total collapse of the current monetary structure. They want to keep the dollar and euro afloat in some way by tying these currencies in with gold..

Here's a portion of a recent Q&A with Mundell. Notice how he doesn't want to make gold convertible at the street level, only at the central bank level, which will allow globalists to continue to control, intervene and manipulate:

Bloomberg's Pimm Fox: You’ve written about the role of gold in the world economy, Professor Mundell. Do you think that we’re going to see any kind of return to the gold standard?

Mundell: [T]here could be a kind of Bretton Woods type of gold standard where the price of gold was fixed for central banks and they could use gold as an asset to trade central banks.

The great advantage of that was that gold is nobody’s liability and it can’t be printed. So it has a strength and confidence that people trust. So If you had not just the United States but the United States and the euro tied together to each other and to gold, gold might be the intermediary and then with the other important currencies like the yen and Chinese yuan and British pound all tied together as a kind of new SDR that could be one way the world could move forward on a better monetary system.
The blog post this quote comes from is the Ralph Benko blog at Forbes. Benko thinks Mundell is God. Get a load of this:

Mundell is the world’s most distinguished living economist.
Puhleeze. That honor belongs to either Thomas Sowell, Israel Kirzner, Hans Hermann Hoppe or Robert Higgs. I don't even have Mundell on the list. What I find most interesting about Benko's comments about Mundell is this:
[Mundell] has acted as a privy counselor to the Chinese government (which in appreciation has named a university for him).   Mundell’s guidance, of course, is one of the reasons why mainland China has had 30+ years of uninterrupted double-digit economic growth.
Benko obviously doesn't realize it, but China is about to suffer the mother of all crashes, of the stock market and economy. The primary reason for the crash is the poorly constructed monetary system that, in all honesty, looks like it was put together by Richard Nixon and G. William Miller. If this, along with the euro is evidence of Mundell's best work, the only thing that should be named after Mundell are the fires of Ghenna.


  1. I point to Jesus Huerta de Soto (Money, Bank Credit, and Economic Cycles) and George Reisman (Capitalism) as the greatest living economists.

    Looks like we are moving ever closer to Keynes' Bancor.

  2. Also, Robert Wenzel, of course!

  3. As always, gold for some reason is never good enough for us peons but great for central banks to hold.

  4. "Mundell is the world’s most distinguished living economist.
    Puhleeze. That honor belongs to either Thomas Sowell, Israel Kirzner, Hans Hermann Hoppe or Robert Higgs."

    Bob Murhpy please.

  5. I read somewhere the Euro was 15% backed by the gold of the member nations.

  6. Its true that the Gold Standard will not come back,but without any convertibility currency confidence will lost.Currency to currency backing is meaningless since convertible currency must have a numeraire for unit of account.So, gold or any precious metal or a basket of commodities would be the final unit of account for convertibility and the stability.