Gold Price Vs Inflation

consequence of flat currency (oil vs cash & oil vs gold)?

If the government continues to “print money” without gold/silver/asset backup, it is called “Flat currency”. If 1 dollar bought 1 gram of gold, and government prints 99 dollars , then the value of gold is 100 dollars. It appears that gold has gone from 1 dollar to 100 dollar,but in reality more dollar is chasing same amount of gold (inflation)

Actually the term is “Fiat Currency” from the Latin “Fiat” meaning “Let there be”. It is currency by government decree, without any obligation to have it backed by tangible wealth, such as the gold you mentioned.

Religious texts, historians social commentators and economists all condem, or have condemned, the practice of debasing currency. The result is financial loss and a transferrence of debt from the government to it’s people, whether they want it or not. This ends up destroying the productive base of an economy, ignites inflation, weakens the fiat currency further, increases unemployment and damages the balance of trade.

The USD, or any other currency for that matter (the Swiss Franc being the one partial exception that I know of) are all Fiat currencies. The USD, and most other currencies all started with a backing of either mono-metallic standard (gold or silver), or bi-metallic standard (gold and silver), and thus it is stated as a promise to exchange bank notes for gold or silver at the Reserve bank of the respective nation.

Governmnets then seek to debase and spend into circulation as many legal tender paper banknotes as they wish, and this is one form of currency debasement. It is accompanied by the quiet removal of the promise to redeem the note for precious metal on demand. The promises on earlier notes are cancelled, and these notes are removed from circulation. Australia did this in 1932.

This esentially means that governments have effectively stolen most of the actual wealth of our own people, and we are left to use their paper money in our daily affairs.

You noted the fixed ratio of 9:1 Oil :Gold (Tr.Oz). This also works for items such as clothing, bread and other food staples, and essential strategic materials such as building materials: the ratio to gold varies little over time once the item is commonplace.

The USD, and other fiat currencies are held up by little more than trust.

Hope this helps!

Peter Schiff: Gold, Inflation, the Fed, and Monetary Policy

GoFit 75cm Professional Stability Ball $44.99 INCLUDES HEAVY-DUTY CORE STABILITY BALL CORE PERFORMANCE DVD PUMP BALL PLUGS & EXERCISE POSTER;75 CMDARK GRAYUPC : 687339202765Shipping Dimensions : 11.70in X 7.50in X 7.40inEstimated Shipping Weight : 5.8…