From Greenspan’s famous 1966 essay, “Gold and Economic Freedom”
1) “Gold, having both artistic and functional uses and being relatively scarce, has significant advantages over all other media of exchange. Since the beginning of World War I, it has been virtually the sole international standard of exchange. If all goods and services were to be paid for in gold, large payments would be difficult to execute and this would tend to limit the extent of a society’s divisions of labor and specialization. Thus a logical extension of the creation of a medium of exchange is the development of a banking system and credit instruments (bank notes and deposits) which act as a substitute for, but are convertible into, gold.”
2) “Thus, under the gold standard, a free banking system stands as the protector of an economy’s stability and balanced growth. When gold is accepted as the medium of exchange by most or all nations, an unhampered free international gold standard serves to foster a world-wide division of labor and the broadest international trade. Even though the units of exchange (the dollar, the pound, the franc, etc.) differ from country to country, when all are defined in terms of gold the economies of the different countries act as one …”
3) “But prior to World War I, the banking system in the United States (and in most of the world) was based on gold and even though governments intervened occasionally, banking was more free than controlled. Periodically, as a result of overly rapid credit expansion, banks became loaned up to the limit of their gold reserves, interest rates rose sharply, new credit was cut off, and the economy went into a sharp, but short-lived recession. … It was limited gold reserves that stopped the unbalanced expansions of business activity, before they could develop into the post-World War I type of disaster.”
4) “In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value.”
From a 1978 hearing before Congress
5) “Central banks, of necessity, determine what the money supply is. If you are on a gold standard or other mechanism in which the central banks do not have discretion, then the system works automatically. … I am one of the rare people who have still some nostalgic view about the old gold standard, as you know, but I must tell you, I am in a very small minority among my colleagues on that issue.”
From his October 2014 interview at the Council on Foreign Relations
6) “Gold is a currency. It is still, by all evidence, a premier currency, where no fiat currency, including the dollar, can match it.”
From his September 2014 essay, “Golden Rule: Why Beijing Is Buying”
7) “The broader issue — a return to the gold standard in any form — is nowhere on anybody’s horizon. It has few supporters in today’s virtually universal embrace of fiat currencies and floating exchange rates. Yet gold has special properties that no other currency, with the possible exception of silver, can claim. For more than two millennia, gold has had virtually unquestioned acceptance as payment. It has never required the credit guarantee of a third party. No questions are raised when gold or direct claims to gold are offered in payment of an obligation; it was the only form of payment, for example, that exporters to Germany would accept as World War II was drawing to a close. Today, the acceptance of fiat money — currency not backed by an asset of intrinsic value — rests on the credit guarantee of sovereign nations endowed with effective taxing power, a guarantee that in crisis conditions has not always matched the universal acceptability of gold.”
8) “If the dollar or any other fiat currency were universally acceptable at all times, central banks would see no need to hold any gold. The fact that they do indicates that such currencies are not a universal substitute. Of the 30 advanced countries that report to the International Monetary Fund, only four hold no gold as part of their reserve balances.”
Greenspan’s comments on the universality and intrinsic value of gold should have you thinking about owning gold to store and protect your wealth. Call American Bullion today at 1-800-326-9598 to speak with one of our precious metals brokers and find out how simple it is to purchase physical gold.
About American Bullion
American Bullion, Inc. specializes in converting your IRA, old 401k, or other qualified retirement plan to a self-directed IRA capable of holding physical gold coins and bars, known as a Gold IRA or Precious Metals IRA. We’ve pioneered a system to handle all the details for you, tax-free and hassle-free. Want to buy gold and silver and store it yourself, outside of your retirement account? Simple – we’ve insured and shipped millions of dollars’ worth of gold, silver, platinum, and palladium to thousands of homes just like yours. As a U.S. Mint nationally listed dealer, we strive to be the best Gold IRA company in the industry and guarantee every transaction is fast, simple, and secure. See our American Bullion Reviews page for testimonials from our many satisfied clients.