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What will have to happen with the world financial situation

BearBear Posts: 18,954 ✭✭
Unless the leaders of the world wish to take their Nations to the very pit of disaster,

one of several possibilities exist.

1. A meeting of world leaders to meet. First they must all agree that they all face the same problem
to various but serious degrees. Second their must be a recognition that NAFTA AND ITS KINDRED AGREEMENTS
have not worked and are in fact causing economic hardship to the Nations involved. They have fattened corporate profits
but have not benefited the workers or the economies of the Nations involved.



2. The balance of payments must be addressed and brought more in to the line of reason.

3. To restore faith in currencies , all nations must agree to back their money with a specified percentage of gold.
This new money will be referred to as gold notes, even though citizens may not be able to redeem the gold. On the
other hand, that might not really be such a bad idea.


4. Nations may have to Nationalized the sale of all new gold to government agencies and jewelers and industrial users, in order to begin the
process of setting a new world price for new mined gold. This should increase the value of old gold to be purchased the by Government as control
of buying and selling mechanisms are taken over by the world governments.

5. This is really the biggest problem of all. Unless the enormous world debt can be reduced to managable proportions all may be lost.
This may mean a balancing off of Nation to Nation debt, or a reduction of the repayment of such debt.I do not really have an answer for this problem
as the greatest portion of Americas debt is owed to our own people thru programs that benefit people and whose programs the people seem to like.



The next method is thru a world war. Though it would destroy most of the world, the winners, assuming there are any winners will renounce all debt
and take over what they will from whatever is left to take.
There once was a place called
Camelotimage

Comments

  • Steve27Steve27 Posts: 13,266 ✭✭✭
    The NA in NAFTA stands for North American so I don't think leaders of the other parts of the world would care. As for other similar agreements, the only one I can think of would be the European Union, and as bad it is right now I don't think they want to give up free trade between those countries.

    As for gold backed money, forget it, we would go right into a depression, because the world economy could only expand based on the amount of gold which could be mined. (It happened to the US in the 1880s.)
    "It's far easier to fight for principles, than to live up to them." Adlai Stevenson
  • derrybderryb Posts: 36,073 ✭✭✭✭✭
    or, just let markets operate without government/central bank interference. of course that would put a lot of useless people out of work.

    Once all of the wealth has been transferred, things will settle back down.

    The decline from democracy to tyranny is both a natural and inevitable one.

  • streeterstreeter Posts: 4,312 ✭✭✭✭✭
    It might be wise at this point to prepare oneself economically for a world war.

    Eight times in the last 20 years we have come to the defense of muslim people however certain elements are at WAR WITH US.

    I like people who like me. They don't like me.

    We are being drawn into these conflicts with the same mentality that soldiers went to rescue the wounded soldier in the movie Platoon. It is in our mentality to help. Pilots went to help stews in the cabins of the airliners on 9-11. That left the airliner in jeopardy. We paid dearly.

    Politicians are not governing this country correctly. We keep hoping--we keep being dissappointed.

    We are being drained of our worth by being extorted for energy.

    There is no point in being in denial about the global conflicts and where they are heading or about our declining liquidity in this country. The country is still strong but is being weakened both internally and externally.

    Brace yourselves for the next FIVE years or longer.
    Have a nice day
  • roadrunnerroadrunner Posts: 28,303 ✭✭✭✭✭
    I don't think it's a given that mining less gold and slowly falling prices mean you can't have real growth. We had it in the 1880's during one of the fastest growing boom periods in our history. Immigrants flocked to our shores to participate in that real growth that was built on a gold standard. From 1800-1906 the price levels in the US started and ended the same.
    That period can be expanded to 1800-1933 as well.

    Between 1862 and 1865, the price level rose about 60% because of excessive issuance of greenbacks. Over the next thirty years, the price level decline by almost 50% due a to a desire to return to the gold standard by 1879. Doing so required either retiring the greenbacks (done initially) or freezing the stock of greenbacks (done later) and allowing the economy to grow into them. Once the gold standard was resumed, the price level continued to fall as the growth in gold was slower than the growth of the economy. Eventually, the price level was about where it was prior to the Civil War. Fortunately, this 30 year run of falling prices was associated with on average rapid real growth, rising real wages, and increasing financial intermediation as noted here. ....from reference below.

    Falling prices and less gold don't always mean low growth

    roadrunner
    Barbarous Relic No More, LSCC -GoldSeek--shadow stats--SafeHaven--321gold
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