Alan Greenspan Advocated For A Gold Standard - In 2007

Saturday, January 22, 2011

Hold your breath. This must be the most overlooked video of former Federal Reserve Chairman Alan Greenspan and it's beginning to make news more than 3 years after its original recording.
Greenspan, creator of the biggest fiat money bubble in the world until his retirement in 2006, not only considers the question of the necessity of a central bank "very interesting" but says, yes, says, that fiat money creation must be limited by a gold standard (or a currency board).

VIDEO: Alan Greenspan advocates a gold standard to restrict the limitless money supply in a fiat money system and says the (central bank free) period of 1870 to 1914 is a good example.
It was Greenspan's policy for 19 years to douse every financial crisis by papering it over. His change of mind came 4 months after the subprime bubble finally burst in summer 2007. Nobody shaped monetary policy more than him in modern times and his money printing is only surpassed by his successor Ben Bernanke.
Greenspan created the longest economic peacetime expansion by fuelling several bubbles with unprecedented money supply growth since 1987.
For this reason his remarkable words do not carry much weight today. The USA would not be buried in debt had he pondered the gold standard while still being in office. At that time Greenspan rather erased all regulations like the Glass-Steagall Act that could have prevented the US debt crisis and its ensuing multi-trillion tally left for taxpayers.
It was Greenspan who famously wrote in 1966,
In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. 
and penned a draft for a gold standard in the Wall Street Journal in 1981
but conveniently forgot his original wisdom in his 19 years as Fed chairman.
Makes one wonder what drove Greenspan whose deregulatory stance enabled the credit mess that is bringing the world to its knees now. Ultimately his legacy will be that of an imploding USA and the complete devaluation of Federal Reserve Notes.
For more on the prudence of a gold standard, here's a list of 78 other common sense reasons for a gold standard.


Wikinvest Wire