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The world champion of the money printing world, Zimbabwe, is now operating on a quasi gold standard with a largely free enterprise economy. There may be lessons to be learned by other countries from Zimbabwe's experience.
Many countries are struggling with excessive debt, i.e. debt that cannot be repaid out of income. When debt becomes excessive, it can be eliminated by bankruptcy or by an inflationary destruction of the purchasing power of the local currency. Sometimes a combination of these two options is possible.
In February 2009 Zimbabwe was the only country in the world without debt. Nobody owed anyone anything. Following the abandonment of the Zimbabwe Dollar as the local currency all local debts were wiped out and the country started with a clean slate.
It is now a country without a functioning Central Bank and without a local currency that can be produced at will at the behest of politicians. Since February 2009 there has been no lender of last resort in Zimbabwe, causing banks to be ultra cautious in their lending policies. The US Dollar is the de facto currency in use although the Euro, GB Pound and South African Rand are accepted in local transactions.
A gold standard system provides money .............
http://www.gold-eagle.com/editorials...eld112309.html
Many countries are struggling with excessive debt, i.e. debt that cannot be repaid out of income. When debt becomes excessive, it can be eliminated by bankruptcy or by an inflationary destruction of the purchasing power of the local currency. Sometimes a combination of these two options is possible.
In February 2009 Zimbabwe was the only country in the world without debt. Nobody owed anyone anything. Following the abandonment of the Zimbabwe Dollar as the local currency all local debts were wiped out and the country started with a clean slate.
It is now a country without a functioning Central Bank and without a local currency that can be produced at will at the behest of politicians. Since February 2009 there has been no lender of last resort in Zimbabwe, causing banks to be ultra cautious in their lending policies. The US Dollar is the de facto currency in use although the Euro, GB Pound and South African Rand are accepted in local transactions.
A gold standard system provides money .............
http://www.gold-eagle.com/editorials...eld112309.html