Close X Cookies are necessary for the proper functioning of By continuing your navigation on our website, you are accepting the use of cookies.
To learn more about cookies ...

What if They Returned to the Gold Standard?

IMG Auteur
Published : December 12th, 2008
584 words - Reading time : 1 - 2 minutes
( 0 vote, 0/5 )
Print article
  Article Comments Comment this article Rating All Articles  
Our Newsletter...





What if the Government went back on a Gold Standard?


Do do that, they would need to use their gold to pay off all their debt. 


That would give a price of gold if the U.S. Government backed the dollar with gold.


We only need to know two numbers, and do a simple problem of division.


First number:  The national debt.


The government tells us this is:


That's 10.6 trillion dollars.


Second number:  The U.S. Gold stock.


The government tells us this is:
261,498,899 ounces of gold


That's 261 million ounces of gold.


So  $10,656,119,227,403 divided by 261,498,899 = $40,750/oz. of gold.


In theory, if the U.S. government had the restraint to stop issuing any kind of new debt, and if there was a runaway hyperinflation, the government could credibly stop any sort of runaway gold price by offering gold at a price of $40,750/oz. 


That's the price that could cap the gold market if the U.S. government sold all their gold to all their bond holders.  At that point, all new taxes would have to be levied in gold, not dollars.


It's important to realize that any effort by the government to sell gold below that price will ultimately fail, and will eventually cause the gold price to go even higher than that price, as that would only deplete their limited stock of gold at inappropriate price levels.


The main point is that T-Bills, which are perceived as the safest haven around, are not safe.  They are only backed up by gold at a rate of $40,750 per oz.  With gold trading today at around $800/oz., the U.S. gold backs less than 2% of the value of the issued bonds, or stated another way, $800 is 2% of the price of $40,750.  Gold, at today's prices, is clearly a far superior safe haven. 


And silver, which is in short supply, due to relentless industrial demand that has consumed nearly all world silver supplies, is even safer.


Clearly, the government cannot offer gold at $40,750 per oz. today.  There would be no buyers.  But, over time, the gold price may rise to such levels, and beyond, as a generation of people slowly wake up to the monetary fraud of the last 29 to 95 years, depending on whether you count from 1980 or 1913.


I am not an advocate of a return to a gold standard, where gold backs up paper money.  I'm in favor of a return to using silver and gold coins and bars as money, as measured by weight, and traded at their intrinsic value according to the price in an open and free market place.



 Jason  Hommel

I have 2 major resources on mining stocks to offer to you.

First, look at  It is a FREE comprehensive database of mining stocks.  Anyone can update or enter data, it's like  Miningpedia has replaced the "silver stock report" in that it is doing the legwork on individual stock analysis that I used to do manually.  This frees me up to do what I like best, which is to write commentary.  My commentary retains the name, "Silver Stock Report", but for individual stocks, please see

Second, I offer a "look at my portfolio" for $50/month; where I share a peek at which stocks I own, once a month.  You can log in at any time, repeatedly, and also see all my prior months


Please visit Silver Stock Report for specific stock picks.







<< Previous article
Rate : Average :0 (0 vote)
>> Next article
Jason Hommel of has written over 100 articles on why people should buy gold, and especially silver bullion and silver stocks. His free silver stock report covers more companies than any other. Jason received a B.A. in Psychology from the University of Colorado at Boulder. An adept biblical scholar, he has also written 100's of articles on theology. Aged 34, he lives in Penn Valley, CA. In response to requests for stock tips, Jason, while not giving out investment advice, offers a "look at his portfolio", which shows his top investments by rank, updated monthly.
WebsiteSubscribe to his services
Latest comment posted for this article
Be the first to comment
Add your comment
Top articles
World PM Newsflow
Mining Company News
Tribune Res.(Ag-Au)TBR.AX
Notice of Annual General Meeting/Proxy Form
AU$ 4.05-1.22%Trend Power :
Corporate news
Black HillsBKH
3:41 am Black Hills Corp raises its FY15 EPS guidance
US$ 43.33-1.23%Trend Power :
Corporate news
Goodrich Petroleum(Ngas-Oil)GDP
Goodrich Petroleum Announces Private Exchange Transactions for Convertible Senior Notes
US$ 0.82+1.23%Trend Power :
Corporate news
Carmanah Tech CorpCMH.TO
Carmanah Releases Preliminary Financial Results for Q3 2015
CA$ 6.01+2.04%Trend Power :
Corporate news
Black HillsBKH
Black Hills Corp. Raises 2015 Earnings Guidance and Announces Analyst Day Presentation Topics
US$ 43.33-1.23%Trend Power :
Corporate news
Impact Silver(Ag-Au-Cu)IPT.V
IMPACT Silver Provides Update on New Capire Mineral Resource Study
CA$ 0.18+16.13%Trend Power :
Corporate news
Bankers Petroleum(Oil)BNK.TO
Edited Transcript of BNK.TO earnings conference call or presentation 7-Oct-15 12:30pm GMT
CA$ 2.44-6.87%Trend Power :
Corporate news
Cheniere Energy(Oil)LNG
LNG Bust Could Last For Years
US$ 53.04-0.47%Trend Power :
Corporate news
Callon PetroleumCPE
4:18 pm Callon Petroleum announces that the borrowing base under its senior secured revolving credit facility was increased by 20% to $300 mln
US$ 8.86-3.90%Trend Power :
Corporate news
Callon PetroleumCPE
Callon Petroleum Company Announces 20% Increase in Borrowing Base
US$ 8.86-3.90%Trend Power :
Corporate news
Comments closed