Comments by "" (@badluck5647) on "CNBC Television"
channel.
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@Apache1970 You clearly have less than a basic understanding of economics.
Again, there isn't gold on earth to be a substitute for the US dollar. Using the gold standard would permanently limit the money supply, which would result in people holding onto their wealth instead of investing it.
China and Turkey are buying gold to get around their own countries' capital controls. Their citizens would love to dump the crappy local currency for dollars, but their governments have made the exchange at the market rate illegal. Instead, they have to settle for gold as a more stable holder of value than their own domestic currency.
While the US dollar does have an inflation issue, it is still the most stable currency, which is a global market where double-digit inflation is the standard.
It is good news that BRICS continues to grow, but it doesn't mean that these governments are reliable financial markets. Brazilians don't want South Africa's rand, and South Africans don't want Brazil's real, so they will continue to use the dollar. (It would be stupid to assume they would use volatile gold, too.) The only market big enough to replace the US would be China, but China refuses to let go of capital controls and the nation's lack of rule of law makes the yuan an attractive currency reserve.
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