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Gold in a Deflationary Economy™

May 17, 1999

Final Part

Final Observations To Gold In A Deflationary Economy:
Onward And Upward

Clearly history is rife with periods of great change, and the global monetary system is certainly not exempt from that change. In fact, Change in the New World will be perhaps of the greatest imaginable, with global unification bringing into a world of international trade and capital flows even non-capitalist, centrally planned economies. The Global Village of the 21st century allows for all countries to participate in world trade and currency exchange, regardless of the form of government. Therefore, the 21st century will bring about a heretofore unimaginable increase in world trade with all types of governments without having to solve the problems typical of a cold war first! And, what this all means is that a stable currency unit amenable to the entire globe is now necessary. Clearly, gold will serve a major role-a role much bigger than those investors fixated on the U.S. stock market now ealize. Asset reallocation should be performed now-not to the complete disregard of other investment markets, but enough to create a diversified portfolio able to embrace and empower the vagaries of the 21st century.

But no matter what monetary system is in use, which era, or which country governs world trade, old is truly a timeless constant in many ways. After 18 years of bear market, it is time to accumulate gold for the long-term and for the transition to a new century, a new global economy, and a new era of monetary union and constant exchange rates. As I, as well as some others versed on the subject, have said, there really is no particular need to labor diligently to establish a unified fiat currency as Europe is attempting to do right now with the euro. Simply reestablish the link between all existing currencies to gold and that is a single currency, for under this gold-backed system anyone, anywhere holding any currency of any type under any type of government could walk up to the gold window and exchange that currency for gold at any time, and gold could still be allowed to fluctuate in the free market as well.

Works Cited

Friedman, Milton, Money Mischief: Episodes In Monetary History, Harcourt Brace & Company, 1994, pages 42-45.
Friedman, Milton, Money Mischief: Episodes In Monetary History, Harcourt Brace & Company, 1994, page 112.
Jastram, Roy, The Golden Constant, Ed. ISBN 0-471-02303-5, John Wiley & Sons, 1977, page 84.
Jastram, Roy, The Golden Constant, John Wiley & Sons, 1977, page 183.
Jastram, Roy, The Golden Constant, John Wiley & Sons, 1977, page 177.
Jastram, Roy, The Golden Constant, John Wiley & Sons, 1977, page 5.
Jastram, Roy, The Golden Constant, John Wiley & Sons, 1977.
Mundell, Robert, "The Case For The Euro-II," The Wall Street Journal, March 25, 1998, page A22.
Jastram, Roy, The Golden Constant, John Wiley & Sons, 1977, page 115.
Jastram, Roy, The Golden Constant, John Wiley & Sons, 1977, page 160.
Skousen, Mark, Economics Of A Pure Gold Standard, The Foundation For Economic Education, Inc., Irvington-on-Hudson, New York, 1977, page xiv.
Jastram, Roy, The Golden Constant, John Wiley & Sons, 1977, page 162.
Friedman, Milton, Money Mischief: Episodes In Monetary History, Harcourt Brace & Company, 1994, page 127.
Friedman, Milton, Money Mischief: Episodes In Monetary History, Harcourt Brace & Company, 1994, page 51.
Jastram, Roy, The Golden Constant, John Wiley & Sons, 1977, page 117.
Friedman, Milton, Money Mischief: Episodes In Monetary History, Harcourt Brace & Company, 1994, page 42.
Jastram, Roy, The Golden Constant, John Wiley & Sons, 1977, page 132.
Jastram, Roy, The Golden Constant, John Wiley & Sons, 1977, page 127.
Friedman, Milton, Money Mischief: Episodes In Monetary History, Harcourt Brace & Company, 1994, page 112.
Jastram, Roy, The Golden Constant, John Wiley & Sons, 1977, page 186.
Greenspan, Alan, "Can The U.S. Return To A Gold Standard," Wall Street Journal, September 1, 1981.