RE:RE:RE:ES LIKES QH
roberto146 wrote: Gold backing means nothing without convertibility. Convertibility means you could end up with no gold and a ton of your own currency, unless everyone goes on gold backing. Then it's necessary to 'fix', i.e. price control the price of gold relative to all currencies in the world. Immediately you price control anything, the price becomes obsolete. That's what caused the States to suspend convertibility in 1971, after gold was fixed at 35, then 42 dollars for years. They lost 2/3 of their gold, and would soon have lost it all. In the late '80s there was a brief aborted attemp by the US to put a damper on the price of gold by having pre-announced sales. The gold sold instantly, and the program was abandoned.
If a currency claims to be 'gold backed', unless gold can be redeemed for that currency, it may as well be backed by bitcoin, or potatoes ... or nothing.
I don't think the intention is necessarily to have a gold backed currency that can be interchangeable with gold itself per say.
The gold backing could simply mean that the currency is not randomly printed. It is anchored in a hard asset. The effect being that the currency itself retains more intrinsic value than one that is backed by nothing.
And that means something.